Sitting of 28 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 5 July.

Oral Answers to Questions
  WALES
  The Secretary of State was asked—

  Health Service
  Mr. Ted Rowlands: If he will make a statement on progress on the reform of the health service in Wales following the most recent meeting of the joint ministerial committee on health. [126693]
  The Secretary of State for Wales (Mr. Paul Murphy): The purpose of the joint ministerial committee on health was to provide an opportunity for all parts of the United Kingdom to share ideas and best practices.
  I know that everyone has found the exchange of experiences a useful tool for putting together plans for the future.
  Following the three meetings held so far, I understand that Jane Hutt, the Assembly Health and Social Services Secretary, will be making a statement to the National Assembly for Wales in July on progress in improving the NHS in Wales and her plans for further action.
  Mr. Rowlands: Following the joint ministerial meetings, can my right hon. Friend say what has emerged as the most immediate, urgent reform required in the NHS in Wales? May I suggest that one fundamental reform would be a formula to ensure that the large amount of new money that we are putting into our health service is distributed to the areas of greatest deprivation in health terms? While I very much appreciate and warmly welcome the most recent announcements of additional support for the national health service in North Glamorgan, I am sure that my right hon. Friend will agree
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  that they represent only the beginning of the fundamental requirement to produce a 21st-century national health service in North Glamorgan.
  Mr. Murphy: Yes. I take the point that my hon. Friend makes. The joint ministerial committee dealt with the relationship between social services and the health service. In that respect, we can learn from Northern Ireland. We looked at the question of preventive medicine and, in respect of Scotland and Wales, what we can offer by way of telemedicine. There will be other important announcements in July. So far as the specific issue of deprivation is concerned, again I take my hon. Friend's point and remind the House that my hon. Friend, other right hon. and hon. Members and I met Jane Hutt this week to discuss the very points that he raised. Like my hon. Friend, I represent a valleys constituency and I understand the importance of tackling the deprivation which undoubtedly exists in Glamorgan and Gwent. I know that the Assembly has already put a great deal of resources into our valleys.
  Mr. Dafydd Wigley: Has the joint committee considered the financing of health in Wales via the Barnett formula and the tendency of that formula to move towards convergence, so that if a service such as health requires more money in Wales because of socio-economic and industrial conditions, it may need money to come from outside what otherwise would have been the health block? Given the need for those additional resources, more resources for ysbyty Glan Clwyd and the £30 million required to deal with asbestos, can my right hon. Friend give an assurance that the July comprehensive spending review will include a consideration for maximising health money for Wales?
  Mr. Murphy: As the right hon. Gentleman knows, my right hon. Friend the Chancellor of the Exchequer dealt with the question of health spending when he explained to the House the considerable increases in the health budget for Wales resulting from the earlier spending review. It means that Wales will receive an extra £1.3 billion over the next few years. I hope that the money will go to the areas of greatest need. The joint ministerial committee has not discussed the Barnett formula. Of course the right hon. Gentleman knows as well as I do that the Assembly Finance Secretary and others discuss these matters regularly.
  Mr. Huw Edwards: In his discussions with other health Ministers, will my right hon. Friend discuss consultants' contracts? Does he recognise the concerns of my constituents who find that if they are on a waiting list they are sometimes advised that if they went privately, the procedure would be carried out much more quickly? Does he agree that what might have been necessary for Aneurin Bevan in 1948 is not suitable for the health service of the 21st century? We should not have restrictive practices which continue to allow consultants to have their mouths stuffed with gold.
  Mr. Murphy: I understand exactly what my hon. Friend says and I assure him that these matters are being discussed. I hope that a number of them will be addressed in the national plan for health which will be announced later this year. At about the same time, the National

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  Assembly for Wales will be making its own deliberations and announcements regarding the matters to which my hon. Friend referred.

  Transport
  Mr. Humfrey Malins: What recent discussions he has had with the First Secretary with regard to transport in Wales. [126694]
  The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): My right hon. Friend meets the First Secretary on a weekly basis, and transport issues are discussed regularly. I also discuss transport issues in my regular bilateral meeting with the Assembly Environment, Transport and Planning Secretary.
  Mr. Malins: Under the present Government, the people of Wales and the rest of the United Kingdom have faced huge rises in the price of petrol—so much so that the price of a litre of petrol will soon reach £1. Do the Government realise the devastating effect that that is having on people who depend on the rural economy in Wales, with many people being forced off the roads by the Government's petrol pricing policy? Will the Minister please make representations to the Chancellor on that point?
  Mr. Hanson: I welcome the hon. Gentleman to Welsh questions. I know of his Welsh antecedents, and of his keen interest in Welsh matters. He will be aware that the previous Conservative Government introduced the fuel duty escalator, and that it was this Government who ended it. It was announced in this year's Budget that, beyond the automatic increase in line with inflation, there would be no increase in fuel duties. It is important to remember that revenues from any increases that do take place in fuel duties will now go straight into a ring-fenced fund for improving public transport, and that Wales will get a share of that.
  Mr. Richard Livsey: With regard to public transport and especially to rail services, some of us had the opportunity yesterday to meet Railtrack representatives. That followed our meeting last week with representatives from Prism Rail, and it is clear from our discussions about an all-Wales rail franchise that investment depends on the effectiveness of the shadow Strategic Rail Authority in lobbying on behalf of the rail system in Wales. The fact that the shadow SRA has only one representative from Wales blunts the competitive edge when it comes to negotiating for investment in the Welsh rail system. What does the Minister intend to do about that?
  Mr. Hanson: The hon. Gentleman will be aware that the matter has been discussed extensively. It is true that there is one Welsh representative among the 15 members of the shadow SRA, but that is on a par with the representation for Scotland. In terms of proportional population, it adequately represents Welsh interests. The Welsh Assembly was consulted on the appointment, and welcomed it.
  Mr. Nigel Evans: No Labour Member standing on the subject of petrol prices, Madam Speaker? It seems that none of them really care. In rural areas of
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  Wales the car is not a luxury, yet the Government use taxation on petrol as a tool of rationing. In 1997, petrol cost 61.7p a litre: today, it costs 84.2p, and even more in some parts of Wales.
  A report from the AA published yesterday shows that an increasing number of people are paying more in petrol taxes than in income taxes. I assume that that would include Prime Minister's chum Lord Levy but, for people on the breadline, petrol prices have hit crisis point. What discussions has the Minister had with the Chancellor of the Exchequer to explain to him the appalling effects on the economy of Wales of his stealth-tax policy?
  Mr. Hanson: I would only ask, "Who introduced the fuel duty escalator?" It certainly was not this Government. We have reviewed the fuel duty escalator and have given a commitment that, beyond the automatic increase in line with inflation, there will be no increase in fuel duties. Moreover, money for public transport will be provided by the Government. That is in stark contrast to what happened under the Conservative Government. We discuss matters with my right hon. Friend the Chancellor on a regular basis, and I am pleased to say that there is more money for public transport in Wales as a result.
  Mr. Evans: There is no consolation in that response for the hard-caned motorist in Wales. On top of the exorbitant petrol prices that they have to pay, motorists who use either of the two Severn bridges face the prospect of VAT being imposed, which would take the toll to about £5. That would hit tourism and the Welsh economy hard, so what representations is the Minister making to the Chancellor of the Exchequer and the Department of the Environment, Transport and the Regions to secure some protection against the wholesale fleecing of the motorist by the Government and the European Commission?
  Mr. Hanson: I think we have adequately covered the fact that the previous Conservative Government introduced the fuel duty escalator, so I shall move on from that. The hon. Gentleman should know that the proposal to impose VAT on charges at toll bridges is at present subject to proceedings in the European Court. No decision is expected until 12 September 2000. The Government are looking at the matter and will discuss it in due course, when a decision is pending.

  NHS Waiting Lists
  Mr. Nick St. Aubyn: What discussions he has had with the First Secretary with regard to the number of patients waiting over 18 months for an operation on the NHS. [126695]
  The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): Both my right hon. Friend the Secretary of State and I regularly meet the First Secretary and the Assembly Health and Social Services Secretary to discuss a range of issues, including health issues and waiting lists.
  Mr. St. Aubyn: I am surprised that the Minister did not refer to this morning's press release from the National Assembly for Wales, which reveals that the number of patients in Wales waiting more than 18 months for an

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  operation has trebled to nearly 5,000 since this Government came to power. Is that not yet another example of how this Government tax more and deliver less?
  Mr. Hanson: If the hon. Gentleman had looked at the figures carefully, he would have seen that in Wales, more than 1,100 more patients are treated every week under Labour than was the case under the Conservative party when it had its chance to run the health service in Wales. When the right hon. Member for Richmond, Yorks (Mr. Hague) was Secretary of State for Wales, the annual increase in health expenditure in Wales was 1 per cent. a year. This year, under the Labour Government, there will be a 5.6 per cent. increase in health spending in Wales. I think that that answers the hon. Gentleman's point.
  Mr. Llew Smith: Is the Minister aware that the south Wales valleys, including my area of Blaenau Gwent, have some of the worst health problems in the United Kingdom when it comes to heart disease, respiratory disease and cancers? Will he comment on the announcement by the Welsh Assembly that it will be another two years before it publishes its formula to tackle health deprivation? Does he accept that the first three years of the life of the Assembly will be totally irrelevant in dealing with the massive health problems in my community?
  Mr. Hanson: There is keen concern in the National Assembly and in the Government about the health disparities in valley communities. I know that the National Assembly has commissioned work to see how this can be tackled. It is undertaking a considerable amount of investigation for which there is financial support, and it is looking at primary health care. Indeed, my right hon. Friend the Secretary of State met this week the National Assembly's Health and Social Services Secretary, Jane Hutt, to discuss this issue. I am sure that my hon. Friend will welcome the fact that some of the extra £1.3 billion that the Government are putting into the national health service will, in the next couple of years, find its way to meeting the needs of the important communities that he represents.

  Hunting
  Mr. Simon Thomas: What discussions he has had with the First Secretary on the implications for Welsh farming of the proposed Bill on hunting. [126696]
  The Secretary of State for Wales (Mr. Paul Murphy): I meet the First Secretary on a weekly basis and we discuss a wide range of issues including the proposed Bill on hunting and its implications for Wales.
  Mr. Thomas: Does the Secretary of State agree that one of his key tasks, post-devolution, is to act as a conduit between the National Assembly for Wales and the Cabinet? In the light of yesterday's vote by the National Assembly in favour of having an option in the proposed Bill for Wales to decide on hunting at Assembly level, what representations will the right hon. Gentleman be making in Cabinet to include such a proviso in the Bill?
  Mr. Murphy: None.
  Mr. Alun Michael: Does the Secretary of State agree that it would be right for Members of this House, when we take a decision, to listen to the views of Assembly Members, as I have listened to the Assembly Member representing Cardiff, South and Penarth? Does he also agree, however, that we should be clear that this issue is a responsibility of this House, and that devolution means partnership between the two bodies, rather than the separation that the hon. Member for Ceredigion (Mr. Thomas) obviously wants?
  Mr. Murphy: I agree with my right hon. Friend. I think that the principle of whether we ban fox hunting with hounds should be a matter for this House of Commons alone. However, I accept that there may be implications in the detail of that legislation, with regard to pest control, for example, which may well be dealt with by the National Assembly. Those issues would have to be taken into account during the passage of the Bill in its parliamentary proceedings. However, I repeat that I agree with my right hon. Friend that the principle should be a matter for this House.
  Miss Anne McIntosh: Does the Secretary of State not accept that hunting and farming are inextricably linked? What assessment has he made of any potential ban on hunting on the Welsh countryside, on Welsh farming and, in particular, on those employed by the hunts in Wales?
  Mr. Murphy: The hon. Lady knows that the Burns commission looked at this issue in some detail. It could not come to a firm conclusion one way or the other about the effects on the rural economy. The National Assembly and the Government are doing everything in their power to ensure that the rural economy is improved.
  In Wales, at least nine very rural constituencies and many other mixed rural and urban constituencies are represented by Labour Members of Parliament. We, too, are conscious of the importance of the rural economy in our constituencies—it is not only the Conservative party which is interested in these matters.
  Mr. Lembit Öpik: As the Minister knows, I support the proposals of the middle way group of MPs for the regulation of fox control, an activity regarded as essential by many mid-Wales farmers. I suspect that the Secretary of State and many of his colleagues have a different view, but will he agree that we must listen to opposing views to see whether there might be a more consensual approach to the issue than may have seemed the case in the past?
  Mr. Paul Murphy: The hon. Gentleman knows that he and I disagree on the issue of fox hunting, but he also knows that one of the purposes of the Bill to be introduced is for hon. Members to have the opportunity to debate the different options available.

  National Parks
  Mr. Michael Fabricant: If he will discuss with the First Secretary policy on tourism in relation to national parks. [126697]
  The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): During his weekly meetings with the First Secretary, my right hon. Friend discusses a variety of areas, including tourism and the countryside. I also discuss these issues in my regular meetings with the Assembly Secretary with responsibility for planning, the environment and national parks.
  Mr. Fabricant: The Minister will know how beautiful the Brecon Beacons and Snowdonia are; many visitors visit them every week of the year. However, he will also be aware of the plight of farming in Wales, where hill farmers' incomes have dropped by more than 40 per cent. in just three years. What steps is he taking to ensure co-existence between tourism and agriculture in our national parks?
  Mr. Hanson: I am aware that the hon. Gentleman recently climbed Snowdon. I am sure that when he got to the top he could not see a Conservative seat for miles. Farming and tourism go hand in hand, and it is important that we have sustainability. The Government have put in additional resources following the recent agriculture summit that I attended on behalf of Wales. There will be a range of measures that the Government can take. It is important that we maintain stable tourism prospects. Tourism brings up to 100,000 jobs directly and indirectly into Wales and brings extra money into Wales. Farming and tourism go side by side and are both important to Wales.
  Mr. Elfyn Llwyd: Given that one of the remits of the national park authority, for example, in Snowdonia is sustainable development, may I suggest to the Minister that we should look for a more productive approach to tourism and that the authorities should have a remit to encourage sustainable tourism, together with a budget so to do? Much of the work is now done by voluntary groups such as Betws-y-Coed and District Tourism Association. They do very hard work and it is well worth while, but it is all voluntary. Should not the work be done on a more definite footing?
  Mr. Hanson: The hon. Gentleman may be aware that the National Assembly recently launched a new tourism strategy for Wales entitled "Achieving our Potential". The three national parks played a full part in the consultation process. They were particularly keen to look at sustainable development, and I fully support the idea of bringing extra tourists to Wales in a way that sustains the beauty that attracts them in the first place.

  Unemployment
  Mr. Chris Ruane: What discussions he has had with the First Secretary about the number of unemployed people in Wales in May 1997 and May 2000. [126698]
  The Parliamentary Under-Secretary of State for Wales (Mr. David Hanson): My right hon. Friend regularly meets the First Secretary to discuss a wide range of issues, including employment in Wales. In addition, I hold quarterly liaison meetings with the Assembly Secretary for Education and Training.
  This Government's continued record of commitment to getting people off benefits and back into work is highlighted by the fact that the number of claimants on jobseeker's allowance for April has been significantly reduced to 59,170, compared with 80,322 when the Conservative Government left office in May 1997.
  Mr. Ruane: I thank my right hon. Friend—I mean my hon. Friend, although he should be right hon.—for that answer. In my constituency, unemployment has fallen by 29 per cent. Youth unemployment has fallen by 69 per cent., despite the fact that I lost 800 workers when Kwik Save closed down. However, I am still concerned about the number of economically inactive people in Wales. What discussions has my hon. Friend had with the First Secretary on reducing the number of economically inactive people in our work force?
  Mr. Hanson: I am pleased that unemployment has fallen by such a significant amount in my hon. Friend's constituency, thanks in no small part to the new deal and the efforts of the Government. The Government are working in conjunction with the Assembly on lifelong learning, social inclusion and active employment action—all things which I hope will help bring the economically inactive back into the workplace so that we can obtain the maximum benefit from objective 1 and ensure that unemployment falls still further.
  Mr. Robert Walter: The House will be somewhat disappointed that the Minister did not give credit to the bright economic legacy left in Wales by my right hon. Friend the Member for Richmond, Yorks (Mr. Hague). That was the reason for the fall in unemployment in the past three years. But what of the future? Objective 1 status will make a contribution to lowering unemployment, but when will we see the money behind that? This week, the European Commission gave its agreement to objective 1 status for Wales. Can the Minister tell the House whether he and the Secretary of State have convinced the Treasury to give full match funding in addition to existing plans for the Welsh block grant? A simple yes or no will suffice.
  Mr. Hanson: The bright legacy left to this Government was the legacy of no Tory MPs in Wales.
  As the hon. Gentleman is aware, there is a process and it has been discussed. It has been explained to him on many occasions. Indeed, my right hon. Friend the Secretary of State and I have told him at every possible opportunity that the matter will be sorted out with the comprehensive spending review in July—it will be addressed at that stage.
  I remind the hon. Gentleman that the bright economic legacy to which he referred resulted in 80,000 people unemployed in Wales; there are now 59,000 people unemployed in Wales—it must be brighter under Labour.

  Aerospace Industry
  Mr. Barry Jones: If he will make a statement on the prospects for the aerospace industry in Wales, with particular reference to Raytheon Systems and BAE Systems in Deeside. [126699]
  The Secretary of State for Wales (Mr. Paul Murphy): I am in frequent contact with the First Secretary on a range of issues and we discuss many aspects of industry in Wales. This has included the BAE facility at Broughton. I have also visited both companies with my right hon. Friend the Member for Alyn and Deeside (Mr. Jones).
  I was pleased to hear that orders for more than 50 A3XX Airbus planes have been received. I also welcome the announcement by my right hon. Friend the Secretary of State for Defence that the UK will be placing an order for 25 A400M aircraft and that the Ministry of Defence intends to buy more of the advanced medium range air-to-air missiles, produced by Raytheon, to equip Eurofighter when it comes into service.
  Mr. Jones: I am grateful to my right hon. Friend. He might agree that the Airbus factory is a jewel in the crown of Welsh manufacturing. I have to tell him, however, of the growing anger and perplexity at the grudging attitude in Cardiff with regard to the company's application for a £25 million grant. Does he agree that nowhere else in Europe would he find a national assembly that was not prepared to follow the national Government's vote of confidence by granting such moneys—certainly not in a German lander or a French département. Does he also agree that Lord Rogers's glass seagull perch cost in excess of the grant for which we are asking? We should very much like my right hon. Friend to intervene to ensure that the grant is paid, to show us that we are on the Cardiff agenda.
  Mr. Murphy: I know that my right hon. Friend battles hard for his constituents and for that important facility. He is right to point out, of course, that the UK Government gave £530 million in launch investment by way of loan to BAE. I shall ensure that his points are relayed to the First Secretary.
  Mr. Owen Paterson: How will the moves by British Aerospace to link up with Boeing affect the Welsh aerospace industry?
  Mr. Murphy: Obviously, my right hon. Friend the Secretary of State for Trade and Industry takes a keen interest in that matter. As the hon. Gentleman is a member of the Select Committee on Welsh Affairs, he will be aware of the importance of the industry and of that facility to all the people in the north-east and, indeed, to his own constituents. I know that he supports the UK Government in doing all that we can to ensure that the facility is enlarged.

  Economy (Deeside)
  Mr. Ben Chapman: What recent discussions he has had with the First Secretary about the Deeside economy of Wales. [126701]
  The Secretary of State for Wales (Mr. Paul Murphy): I have regular discussions with the First Secretary on matters relating to the economy of Wales and have visited Deeside on a number of occasions.
  The Government's decision to give £530 million launch investment to BAE is good news for the UK and, I know, for my hon. Friend's constituents.
  Mr. Chapman: Does my right hon. Friend agree that the Deeside economy is unitary? To that extent, my constituents who work at BAE also welcome the A3XX and hope that regional selective assistance will be awarded. Does my right hon. Friend also agree that the environment too is unitary and that there is concern in my constituency about the Castle Cement kiln? Can he say what account has been taken of the views of my constituents in any decisions on planning permission for that kiln?
  Mr. Paul Murphy: Yes I can. Obviously this is a matter for the National Assembly for Wales. It has called in the planning application, and a planning inquiry into the application will take place on 11 October.

  Hunting
  Mr. James Clappison: What recent representations he has received about hunting with dogs in Wales. [126702]
  The Secretary of State for Wales (Mr. Paul Murphy): I have received no representations about hunting with dogs in Wales. Together with my Whitehall colleagues, I am taking a keen interest in developments on these issues and I of course am sensitive to the reactions of the Welsh rural community to this matter.
  Mr. Clappison: The Secretary of State spoke earlier about the details of the Burns report. What thought has he given to the conclusions of the Burns report as to how difficult it would be to control fox numbers in the upland areas of Wales in the absence of hunting with dogs as it is carried on in Wales? What message does he have for farmers who are worried about their stock, and who face a difficult enough time already?
  Mr. Murphy: Conservative Members know that there will be debate on that matter in the House of Commons in a week or so. The hon. Gentleman will be able to express his views then. On the question of pest control in Wales, the hon. Gentleman knows that, in Wales particularly, the farmers themselves flush out foxes with dogs, and he is also fully aware that other methods that are used in Wales could control pests, including foxes. It is not just hunting with hounds that can control foxes. I am sure that the hon. Gentleman also knows that the great bulk of Members of Parliament in Wales—and, for that

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  matter, as far as we know, Members of the National Assembly—do not believe that hunting with foxes—[HON. MEMBERS: "Foxes?]—is a good idea.

  The Prime Minister was asked—

  Engagements
  Ql. [126723] Mr. James Clappison: If he will list his official engagements for Wednesday 28 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 will have further such meetings later today.
  Mr. Clappison: Does the Prime Minister have a view as to why crime is now rising for the first time in six years? Could it have anything to do with the fact that police numbers are going down?
  The Prime Minister: Of course, crime doubled under the Government of which the hon. Gentleman was so proud. It is correct that in the last few years of the previous Government, and in the first few years of this Government, police numbers have been falling. However, as a result of the extra money that we are able to put in, which the hon. Gentleman's party would cut, by the end of the year police numbers will be rising again.
  Dr. Ian Gibson: The recent announcement of two new medical schools, one in Norwich at the university of East Anglia, and the Peninsula medical school in Cornwall and Devon, should be hailed as a great success for our national health service. At the same time, the prospect of the human genome research in rolling out an understanding of the genetics of cancer means that we shall move things forward on that scientific front. Will my right hon. Friend play a major role in the development of our national cancer plan, and will he ensure that we consider, as the Select Committee on Science and Technology is doing, a national cancer institute, and perhaps 12 Royal Marsdens? Certainly, the postcode lottery for treatment with drugs and therapies must disappear.
  The Prime Minister: The recent scientific discovery in relation to the human genome is immensely important not just for science but for this country, as we have played a leading part in developing it. I am delighted to say that the establishment of the new medical school at the university of East Anglia, which I know that my hon. Friend campaigned for and supported, will mean that we shall get the first brand-new medical schools in this country for 25 years. We are also increasing the number of medical school places by at least 1,000—the biggest increase in a generation—and, as a result of the additional spending in the national health service, we shall be able to make the investment not merely in bricks and mortar, and in nurses and doctors, but in medical schools as well.
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  What the country should know is that all that spending would be cut by the Conservatives, because of their risky tax policy.
  Mr. William Hague: After three years of the mounting stealth taxes with which the Government have clobbered the hard-working people of this country, will the Prime Minister now tell the House what the price of a litre of petrol was when he took office, and what it has increased to today?
  The Prime Minister: First, I think that people remember the 22 tax rises under the Conservative Government, including the doubling of VAT after they said that they would not do that. As for petrol, yes it is true that petrol prices have gone up, and it is true that, in the first two years of the present Government, they went up substantially as a result of increases in fuel duty. However, it is right to point out that of the rise in the last year—a rise of about 18p a litre—only 2p has been due to fuel duty. Sixteen pence—in other words, the vast bulk of it—has been due to the rise in oil prices, and that is affecting not just this country but countries right round the world.
  Mr. Hague: Millions of people are paying the right hon. Gentleman's stealth taxes every day, and he is so out of touch that he does not know how much they are paying. The price of fuel has gone up 44 per cent. at the pump since he took office, and 34 per cent. of that is due to increases in taxation. It has gone up from 59p a litre to 85p a litre. When the Chancellor said in his Budget speech that he was indexing pensions and petrol by inflation, did the Prime Minister realise then what no pensioner could have known—that the inflation figure that he used for petrol was three times higher than the figure he used for pensions?
  The Prime Minister: No. As I said in the House last week, the formula used for pension rises is exactly the same as the formula that has been used for the past 12 years. Yes, it is true that this year it has meant a small pension rise. Last year it meant a larger rise, as it will next year. The formula is the same as that used by the Conservative Government of which the right hon. Gentleman was a member.
  Mr. Hague: Since the Prime Minister took office, pensions have been indexed by 8 per cent. and petrol by 34 per cent., so trying to make out that somehow that has been of advantage to pensioners is an utterly laughable proposition. Will he now confirm that when the Chancellor said that pensions would go up by inflation, he meant 1.1 per cent., and when he said that petrol would do the same, he meant 3.4 per cent., because he changed the method of calculating the petrol increase from that used by the previous Government? Will the right hon. Gentleman now confirm that when Ministers told the House on 6 April that they had not changed the methodology, they were not telling us the correct story?
  The Prime Minister: That is wrong, for the reason that I have just given. Precisely the same formula is used for pensions as was used under the previous Government. As a result of the fuel duty escalator in the first two years of this Government, fuel duties went up, as was the case

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  under the previous Government, of which the right hon. Gentleman was a member. There is a choice, it is true. We decided that we had to erase the deficit that we inherited—£28 billion in borrowing and a doubled national debt. As a result, we have interest rates that average 6 per cent.—under the previous Government, they averaged 10 per cent.—and we can now make the extra investment in schools and hospitals. Is the right hon. Gentleman saying that he would not have taken those measures on petrol, and would therefore have cut the money spent on schools and hospitals?
  Mr. Hague: If the right hon. Gentleman wants me to give him a Budget, he can hand over as First Lord of the Treasury any day. I am asking him a question to which he has not given an adequate answer, as everyone who is watching knows. It turns out to be the case that the switch to a forecast figure for petrol duties was introduced by this Chancellor. It is no good the Prime Minister talking about the escalator, because petrol duties have gone up twice as much in the past three years as in the previous three years. When he abandoned the escalator, he got into a lift instead. For people who have saved up for their cars, people in rural areas who need a car, and people who are old or disabled and need a car to get about, is it not bad enough that he fleeces them at every opportunity, without using every opportunity to cover it up as well?
  The Prime Minister: Of course, the fuel duty escalator was introduced by the previous Government. It is correct that we kept it. Petrol prices have gone up significantly, and of course that is difficult for people in rural areas and those who go long distances by car. However, it is worth pointing out that, although it is correct to say that it may cost more than £50 to fill up the average 1600 cc motor car in England, it is also correct to say that it costs more than £40 to do so in France and Germany, and that France has motorway tolls and vastly higher income taxes. I accept that we had to put petrol duty up, but there was a choice: either we could cut the deficit and make the investment in public services, or we could decide not to take those measures. I do not believe that we would have 1 million extra jobs in the economy or interest rates at 6 per cent. if we had not taken those measures. If the right hon. Gentleman is telling us that he would cut fuel duty, that means that he would also cut the money that we are putting into schools, hospitals and transport.
  Mr. Hague: This Government cannot even tell the truth about the duty on a litre of petrol. They are so busy with trivia such as banning musical chairs, bailing out the dome, telling the royal family to move house and counting the number of fat people on television, that they have forgotten what really matters to people in this country. Is the time not coming when the people who cannot now afford to run a car will take their revenge on the people who cannot manage to run a Government?
  The Prime Minister: Let us see who managed the economy best. The party now in government has created 1 million extra jobs, got interest rates of 6 per cent., managed to halve the deficit that we inherited—in fact, get rid of it—and taken a million children out of poverty.
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  Was it our party or the right hon. Gentleman's party which, in government, doubled the national debt, had interest rates—[Interruption.]
  Madam Speaker: Order. Stop it.
  The Prime Minister: It is the comparison that Conservative Members do not like.
  Which party had interest rates averaging 10 or 11 per cent., took unemployment figures over 3 million, had manufacturing output cut by 7 per cent., devalued the national health service and our schools, and doubled crime and poverty? [HON. MEMBERS: "Go on."] Yes, I could go on for a long time, as there is a sad story to tell. There will be a choice, and on the day that there is, people will compare the record of this Government with that of the Government of which the right hon. Gentleman was a member—and they will know that the Tories are worse and more extreme than ever.
  Mr. Anthony D. Wright: I am sure that the Prime Minister will join me in welcoming the 18 per cent. drop in unemployment in my Great Yarmouth constituency. The statistic for the young unemployed is even more impressive, with a drop of more than 50 per cent. in the past three years. Despite that good news, however, Yarmouth's unemployment rate is one of the highest in the country. Indeed, it is three times the East Anglian average. Will the Prime Minister outline to my constituents what the Government intend to do to build on the good news that we have had over the past three years and ensure that sustainable jobs are created in areas such as Great Yarmouth?
  The Prime Minister: Of course I am delighted that 1,000 people have started on the new deal programme in my hon. Friend's constituency, and nearly 500 of them have gained jobs. [Interruption.] For those Conservative Members who are shouting, I shall repeat that they would abolish the new deal. People who have got jobs under this Government know that they would have those jobs taken away by a Conservative Government. Moreover, my hon. Friend's constituents, whose mortgage rates have come down from the appalling levels of the early 1990s under the Conservatives, know that under the Conservative boom and bust policy, they would go back up again.
  Mr. Charles Kennedy: Can the Prime Minister confirm that health action zone funding will be maintained in 2000–01 at the levels originally set and announced by the Government?
  The Prime Minister: The health plans will be set out by myself; I am covering the July plan in a few weeks' time. We shall set out the details of our spending proposals. Health action zones are immensely important and do a very good job in many local areas, and obviously we want to continue them.
  Mr. Kennedy: I think that the whole House would want to continue them—[Interruption.] I was just trying to be inclusive. If the position is as optimistic as the Prime Minister says, why, in a letter that came into the public

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  domain today, did the Minister of State, Department of Health, the hon. Member for Barrow and Furness (Mr. Hutton) state:
  I appreciate the programme funding—
  for 2000–01—
  is less than previously indicated?
  The accompanying notes from civil servants state:
  We … will, in effect, be announcing cuts to anticipated Health Action Zone Budgets this year.
  They go on to say in ministerial advice:
  This will not be received as good news and we do not recommend a press notice.
  Why do the Government continue to announce funding that does not exist? Will the Prime Minister not admit that this is another attempt at the triumph of spin over substance?
  The Prime Minister: That is absurd. The Government have announced new money for the national health service, and it is already going into the service. When we came to office, health authorities had huge deficits, which, as a result of the new money, are largely being cleared. There are already 7,500 new nurses, and there are thousands more to come. There are also extra doctors, accident and emergency departments are being renovated, and extra spending has been announced not only for this year but for future years.
  As for the right hon. Gentleman's point about health action zones, I shall look into that for him, but I think that he will find that, when taken with the money given to health authorities in those areas, the funding has gone up, not down. I shall set it all out for him in a letter.

  Ministerial Visits
  Mr. David Taylor: When he next plans to visit North-West Leicestershire.
  The Prime Minister: I have no immediate plans to do so.
  Mr. Taylor: As one of a north-west Leicestershire family who ran the post office in my home village for most of the 20th century, may I ask my right hon. Friend how likely it is that the extra income from community banking, electronic commerce and online government will compensate local offices for the losses that will result from automated credit transfer? When he does visit us, will he reassure rural and urban communities that the local post office network really is safe in his hands?
  The Prime Minister: The proposals to be announced by the Secretary of State for Trade and Industry later today will do that, and I think that they will be widely welcomed. It is important that we set out a plan for post offices that will allow them to modernise and develop, which is essential, and ensure that in every way possible, we protect rural post offices for the local communities that they serve.
  I say to my hon. Friend that in this exercise we have had to work closely with people in both rural and urban post offices to devise a plan that accords not only with people's desire to keep their local post offices, but with
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  reality. Every year, 500,000 more people get their benefits paid into their bank accounts. We have to take account of that in any plans for post offices, and we will. When my right hon. Friend sets out his plans later, the House will see that they will ensure that post offices have a future. That will be yet another dividing line with the Conservatives, because their tax policy would not allow them to fund the programme that we will be funding.

  Engagements
  Dr. Phyllis Starkey: May I tell my right hon. Friend that in October 1999, the waiting time for a cataract operation at Milton Keynes general hospital in my constituency was 12 months, whereas now, thanks to additional Government funding for an extra ophthalmic surgeon, the waiting time has been reduced to between four and six months? That is much better, although there is still room for improvement. Does that not demonstrate that the best way to reduce waiting lists in the NHS is to use public money directly to recruit extra doctors and nurses, and not, as the Conservative party proposes, to waste £1 billion on tax relief for private health insurance, half of which would be for those who can already well afford to pay for private insurance?
  The Prime Minister: I am delighted that the waiting times for cataract operations are coming down in my hon. Friend's area, although as she rightly said, there is still a considerable way to go. Of course, the Conservatives want to drive everyone needing non-urgent treatment, such as a cataract operation, out of the NHS altogether. We still have not had an answer from them as to how their £1 billion plan for private medical insurance would be funded, if it is not to be funded from cuts in the NHS.
  Mr. David Lidington: When the Prime Minister next enjoys a weekend in the Buckinghamshire countryside, will he commit himself to preserving that countryside for my other constituents by overturning the unwanted and excessive housing targets that his deputy now wants to impose?
  The Prime Minister: First, let me point out that the targets put forward by the Deputy Prime Minister are lower than those for many of the years of the previous Conservative Government, of which the hon. Gentleman was a proud supporter. [Interruption.] That is entirely true. Secondly, we did not accept the original plans, and we have increased the amount of building that must take place on brownfield, rather than greenfield, sites.
  In addition, obviously we are trying to make sure that we do not end up with no houses being built in the south-east at all, since that would put extraordinary pressure on the people already living here. A balance must be struck, and most people believe that the Deputy Prime Minister, in accepting figures well below those in the plans put forward by the independent body, has steered a wise course and reached a sensible compromise.
  Ms Margaret Moran: Is my right hon. Friend aware of the recent opening by Vauxhall Luton of a £5 million research and development engineering technology centre, and the investment of £189 million in United Kingdom plant? Will he join me

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  in congratulating all the workers of Vauxhall Luton on the work that they have put in to secure that investment? Does he not agree that that is a significant boost to UK manufacturing industry, which stands in sharp contrast to the actions of the Conservatives, under whose regime 26 million manufacturing jobs were lost—[Interruption.] Manufacturing output dropped by 28 per cent., and they constantly talked down UK manufacturing industry?
  The Prime Minister: I think that it was actually 2.6 million jobs that went under the previous Government. [Interruption.] Conservative Members seem to be rather proud of that record. There is good news not just from Vauxhall but from Leyland Trucks, too. Manufacturing has been through a difficult period indeed, but the single most important thing for the whole of our industry is to maintain stability in inflation and in the interest rates in the economy. All the manufacturers whom I speak to—even those who are worried about the high level of sterling recently and about manufacturing—accept that the last thing they need is a return to the policies of the late 1980s and early 1990s, when interest rates were at 15 per cent. for a year, and a million or more manufacturing jobs went in a couple of years.
  Mrs. Teresa Gorman: Will the Prime Minister confirm the story in The Guardian today that his press secretary, the fabled Alastair Campbell, has instructed every Department to produce at least two good news stories every week for two months during the summer recess, to cheer up the Labour party's image? Is it not time that that gentleman was taken off the public payroll and put back in on the payroll at Millbank, where he belongs?
  The Prime Minister: I agree with the hon. Lady; it was an entirely redundant message since there is lots of good news that we can tell people about—for example, the record literacy and numeracy results in primary schools, the additional spending in 11,000 schools up and down the country, the 250,000 jobs got through the new deal, the extra money for pensioners, the extra money for children and child benefit, the extra money for schools and the extra money coming for the police after the comprehensive spending review. I agree that he need not have sent that out; we can do it ourselves.
  Maria Eagle: Will my right hon. Friend welcome, as I will, the close of business in the House today, by which time, if all goes well, the Fur Farming (Prohibition) Bill will have completed its passage? Will he join me in ensuring, to the extent that he can, that those in the other place do not interfere too much with the Bill, so that the Government can fulfil yet another pre-election promise?
  The Prime Minister: Certainly, to the extent that I can, I will.
  Mr. Paul Tyler: Does the Prime Minister accept that No. 10 Downing street is an historic building of considerable public interest? Does he not think that, as he is the head of a so-called modern
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  Government, it is about time he got out? Is it Government policy to ask the present occupant of Clarence house to vacate it—and when will all this end?
  The Prime Minister: I think that we should all stay put.
  Mr. Vernon Coaker: Will my right hon. Friend take this opportunity to encourage local authorities such as Tory-controlled Gedling borough council to use the new powers that the Government have given them to tackle anti-social behaviour in their communities? People are fed up with the yobs. They are fed up with bad neighbours. They want something done about it. We have given local authorities the powers. Is it not about time that they used them?
  The Prime Minister: I entirely agree with my hon. Friend. A breach of such an order is a criminal offence with a maximum penalty of five years in prison. Although the use of those orders is now on the increase, far more could be done. There is nothing worse than if a family has to live in an inner-city estate or in a town next to families that perhaps are engaged in criminal activity, drug dealing and all the rest of it. They make their lives absolute hell, and those anti-social behaviour orders are there to be used. I urge all local authorities to use them, particularly the Conservative ones that are slow to do so. They are there for the protection of the public, and the more we use them, the better.
  Mrs. Ann Winterton: Will the Prime Minister have a word with the Department of Health about its disingenuous policy of, on the one hand, stating that it opposes euthanasia, while, on the other hand, it allows passive euthanasia by the withdrawal of medical treatment, including food and fluids, from those who are not dying, thereby making even more vulnerable the frail, the elderly and the disabled?
  The Prime Minister: I do not believe that that is the policy of the Department of Health at all.
  Mr. Jim Fitzpatrick: Yesterday, the right hon. Member for Bridgwater (Mr. King) and Sir William McAlpine performed the topping-out ceremony at EXCEL, London's new international conference and exhibition centre in docklands in my constituency, barely a year after the Deputy Prime Minister performed a ceremony at the beginning of building. EXCEL opening in November will be a key element in the regeneration structures for east London. However, one of the more eagerly awaited pieces of transport infrastructure is the channel tunnel rail link coming into Stratford. Can the Prime Minister reiterate the Government's commitment to the building of phase two of CTRL, which is important not just to London and the Thames gateway area, but to the whole of the UK, to provide fast rail access to Europe?
  The Prime Minister: I can certainly confirm the commitments that we have made. Of course, that is an infrastructure project that will bring not just better infrastructure but jobs to the area. I know that my hon. Friend has been working hard with other hon. Members

  905
  in regenerating that particular part of London. As a result, literally thousands more jobs are being created. That is good for local business and local people.
  Mr. Elfyn Llwyd: Will the Prime Minister confirm Lord Wakeham's assertion, as reported in The Independent today, that he came under considerable Government pressure to fudge his report on the House of Lords?
  The Prime Minister: No, I will not confirm that at all. I thought that it was a good report, but it was Lord Wakeham's report.
  Mr. Michael Clapham: My right hon. Friend will be aware that the Health and Safety Commission recently announced its future health and safety strategy, including 10-year targets. Those targets are to reduce ill health in the work place, to reduce fatalities and to reduce the number of major injuries. Does he agree that those targets need teeth, that the Government should look towards legislation that will support sanctions against people who breach health and safety legislation, and that named directors of companies should be responsible for health and safety policy?
  The Prime Minister: I agree with my hon. Friend that that is a serious issue, which is why, a short time ago, the
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  Deputy Prime Minister set out a new strategy that sets targets for improvement over a period of 10 years. The cost to the economy of health and safety failures is some £18 billion a year. Fatal accidents cost 400 people a year their lives, and 25,000 have to give up work due to accidents, never to return, so I entirely agree with my hon. Friend that it is a very important issue. We will work with employers, trade unions and others to improve the situation.
  Mr. Andrew George: Bearing in mind the fact that 11 men have lost their lives in the fishing industry in my constituency in the past three and a half years, leaving 23 children without fathers, does the Prime Minister understand just how disappointed the industry was when the Minister of Agriculture cut fishing safety grants in May last year? People were encouraged when the Deputy Prime Minister promised to reinstate them a year ago, but there has been no action since then. Will the Prime Minister intervene to ensure that fishing safety grants are improved, so as to improve fishing safety throughout the UK?
  The Prime Minister: First, I express my sympathy to the families of the hon. Gentleman's constituents who lost their lives. Secondly, on the forward-spending plans of the Government, I am afraid that he will have to wait for the comprehensive spending review.

Post Office Network
3.30 pm
The Secretary of State for Trade and Industry (Mr. Stephen Byers): With permission, Madam Speaker, I wish to make a statement on the post office network. Post offices are a vital part of the fabric of our country. They serve 28 million people every week, performing a vital role in local communities, whether they be rural or urban.
However, the Post Office also faces challenges. Its traditional work needs to respond to the changing requirements of customers, to changes in society and to the opportunities arising from new technology. Last October, my right hon. Friend the Prime Minister asked the performance and innovation unit to draw up a strategy for the future of the post office network. The PIU's report is being published today. Copies are being placed in the Library of the House and will be available from the Vote Office. The Government accept all the report's 24 recommendations. Working with the Post Office and the National Federation of Sub-Postmasters, we will implement the measures proposed in full. We will back them with financial support—we will be setting aside ring-fenced funding as part of the spending review to be announced in July.
The Post Office is the largest retail network in Europe. More than nine out of 10 people live within a mile of a post office. However, for too long the post office network has been a neglected national resource. Now is the time to harness its full potential and to develop it in totally new areas.
The PIU report identifies three such areas where developments should take place, made possible only by the investment by this Government of £500 million in modern online computer systems for every one of the 18,500 post offices throughout the country. The three developments are, first, to establish a universal bank; secondly, to provide internet access and exploit e-commerce; and thirdly, an enhanced role in government services.
First, the Government are aware that our decision to move to a system of automated credit transfer between 2003 and 2005 has caused concern. However, people were already voting with their feet and choosing to have their benefits paid into their bank accounts. Today, I can guarantee that, even after the move to ACT, pensions and benefits can still be paid in cash in full at a post office if that is the choice of the individual pensioner or benefit recipient.
The universal bank outlined in the PIU report would provide the means of achieving that objective. It would ensure that all benefit recipients and pensioners, now and in the future, could continue to use post offices to receive their cash. It would be a post office-based solution, as called for by the National Federation of Sub-Postmasters.
Today in Britain, about 3.5 million adults have no bank account. The universal bank would bring those people into the banking mainstream by providing basic banking services. Customers of the universal bank would be able to get out cash at any post office and use cash machines to take out money. They would be able to set up direct debits to pay bills, enabling them to benefit from discounts on gas, electricity, telephone and other bills. That would be a real bonus to people on low incomes who, at the moment, are the unbanked.
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Secondly, we want to provide internet access and to exploit e-commerce through the post office network by installing internet terminals in front of the counter and ensuring that post office staff are trained to provide assistance. Post offices also have an opportunity to market themselves as a convenient local place for people to collect goods that they have ordered over the internet.
Thirdly, we want an enhanced role in government services for the post office network. Post offices have traditionally been places where people can do a range of government business, from renewing a car tax disc to getting a fishing licence. That role will be further strengthened with the PIU's recommendation that post offices become one-stop shops—general government practitioners—for advice and information on government services. We shall support pilot projects on this and on internet access.
This vision of the 21st century for the Post Office applies to the entire network. However, the PIU report also identified the particular needs of the network in urban areas and in rural communities. The rural post office network has been slowly contracting over the past 20 years; the Government are committed to ensuring that it is maintained. The importance of rural post offices cannot be underestimated. Often, they are the last remaining local shop, providing a vital service and also acting as a focal point for the local community.
The maintenance of such services is, above all, a tribute to the invaluable role of sub-postmasters and mistresses, who often provide to their communities much more than is required or expected of them. The Government have already made provision through the Postal Services Bill to provide financial assistance to post offices, where necessary. In order to protect rural post offices, the Government will place a formal requirement on the Post Office to maintain the rural network, and also to prevent any avoidable closures of rural post offices. Our commitment is clear: to maintain the rural network and prevent any avoidable closures in that network.
An unavoidable closure would be when no one was prepared to take over from a departing sub-postmaster, or where an associated retail business was no longer commercially viable. Otherwise, the network will be maintained. The PIU report recommended that the requirement to maintain the rural network should apply in the first instance for a period of six years. We accept that recommendation. During this period, the Postal Services Commission, together with the Consumer Council for Postal Services, will monitor the network, and the commission will report annually to me on the rural network.
At present, the Post Office defines a rural post office as one which covers 6,300 inhabitants. Currently, 7,500 post offices are covered by that definition. However, the Countryside Agency defines a rural post office as one serving a settlement of 10,000 or fewer people. Around 10,000 post offices would come within that definition. I am pleased to inform the House that, for the purpose of the policy of protection from avoidable closures, we shall apply the wider definition and thereby cover nearly 10,000 post offices.
It is not just in rural areas that post offices play an important community role. We want to maintain convenient access and improve the quality of post offices in our towns and cities, as well as in the countryside.

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Under pressure from changes in the pattern of retailing, the quality of many post offices and associated retail business has declined in urban areas over the years. We believe that the best way to address that is for the Post Office, working closely with the National Federation of Sub-Postmasters, to build bigger and more extensive offices, reversing years of underinvestment. As the PIU recommended, we will encourage them to do so.
Post offices in deprived neighbourhoods and estates have a particularly important role, often providing the basis for the only local shop. Our aim is to ensure that people in these areas, where there are few other facilities, continue to have access to high quality post offices, preferably co-located with good shops. To support that, we will set up a new fund to improve the quality of post offices in deprived urban areas, thereby better serving the needs of the local community. Uses of the fund would include installing security measures and modernising premises.
These proposals provide a significant package for guaranteeing access to post offices and enabling them to provide new services which meet the changing needs of customers. By providing financial support for these initiatives, the Government are backing a viable, sustainable future for the post office network. However, the Post Office itself needs to respond to the challenges. The PIU report shows that much more needs to be done: to maximise the commercial potential of the network; to improve efficiency; and to raise the quality of post offices.
The vision set out in the PIU report, which we support, is closely in line with that of the general secretary of the National Federation of Sub-Postmasters, with whom we have been in close dialogue. The package announced today complements the measures in the Postal Services Bill. Post offices and their customers, in all areas, will benefit from the wide range of opportunities offered by a modern online computer system in every post office and proposals to establish the universal bank, internet learning and access points and general government practitioners.
Customers in all urban areas should benefit from bigger and more expensive post offices offering a wider range of services. Those in rural areas will also benefit from the requirement to maintain the rural network. Those in inner cities and estates will benefit from measures to ensure that post offices provide good local shops which serve the community.
This announcement will ensure that people throughout the country—in rural communities and in our cities and towns—have convenient access to a post office providing quality services. It will offer the opportunities that the Post Office needs to face the future with confidence, and to build a network that can thrive rather than just survive in the 21st century. I commend the statement to the House.
Mrs. Angela Browning: I welcome the fact that the Secretary of State is making a statement on the sub-post office network. It would have been so much better if he had found some solutions to the problem that he caused when he scrapped a scheme last year simply by circulating a letter on a "Dear colleague" basis. We know that his announcement means that £400 million of income will be removed from the sub-post office network from the year 2003.
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As a result of the uncertainty that the Government have created among sub-post offices, over the past year there has been an escalation in sub-post office closures to about 500. That uncertainty has been demonstrated by the sub-postmasters themselves, who attended a rally on 12 April and presented one of the biggest petitions ever to a Government, when 3 million signatures were handed in at No. 10 Downing street.
We have devoted two Opposition days to debating this matter. The Secretary of State's statement is light on detail and particularly light on fact and financial detail. I hope that, when he comes to answer specific questions, he will not duck the issue but will say how much money is on the table as part of the package that he has announced. Can he guarantee that what he has read out will make up the £400 million shortfall that the Post Office will suffer from 2003?
On the universal bank, will the Secretary of State please explain—I have asked this before, and we really need to hear the detail now—where the charges will fall? Supposedly, 3.5 million new account holders will be members of the new bank. Do the charges fall on the customer, on the Post Office, on the bank or on the taxpayer? Who will bear the transaction costs of money from existing bank account holders who may still want to draw their money from their post office? He and the Government have given guarantees in the past that those people will not have to bear the transaction costs. Who will bear them?
The Secretary of State paid much attention to the rural post office network. Some of the most fragile post offices are in rural areas. What minimum number of sub-post offices will he guarantee to keep open in the network?
The right hon. Gentleman mentioned information technology. Conservative Members welcome the opportunities that IT offers the sub-post office network, because it was our policy to put computers into sub-post offices in the first place. Given the increase in e-commerce and, we hope. the rapid escalation of home deliveries—but to a population in which so many people are now out during the day—is it his intention to allow the sub-post office network to handle parcels from private sector parcels companies other than Parcelforce, as that would certainly increase the sub-post office income?
What additional government services has the Secretary of State already discussed in relation to this one-stop shop that he talks about? The Government are pledged to deliver electronic government by 2005–50 per cent. is supposed to be ready by 2003—so Departments must be well advanced in knowing what services they will deliver electronically. Rather than just giving generalities, will he tell us exactly what Government services the sub-post office network will be allowed to tender for, so that people can plan for their financial future and know where their income is coming from?
We have heard a lot from the Secretary of State about subsidies. Exactly what does he mean by the Government using subsidies? The National Federation of Sub-Postmasters, with which he says he has been in contact, has said in terms that it is looking not for subsidy but for genuine alternative forms of income. If he intends to subsidise individual post offices, what analysis has he made of the distortion that such a subsidy would create for either the next nearest sub-post office or, for that matter, for the village shop, which may not be a sub-post

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office but may sell products in competition with it? Is he not at all concerned about the small business aspect of creating artificial competitive distortions in the market?
I know that sums are not the Secretary of State's strong point, but he will have to address the figures eventually. The Post Office had to bear a £571 million write-down as a result of his policy change in this financial year's annual report. Will the sums that he is talking about, albeit in general terms, be another write-down in next year's accounts for the Post Office itself, or is this some new money that he has got from the Chancellor, which the taxpayer will have to provide through the Treasury?
Mr. Dennis Skinner: Is she for it or against it?
Mr. Byers: Now we know why 3,000 post offices were closed while the Conservatives were in government. Are they for it or against it? Who knows from the hon. Lady's contribution?
The hon. Lady asked some specific questions. The wonderful benefit payments card has been held up as the way forward. When we came to office, it had already overrun by three years, was over budget and was set to be obsolete by 2007. The Conservatives may deny it, but that was the reality. The hon. Lady knows it, and the right hon. Member for Hitchin and Harpenden (Mr. Lilley) knows it too, because he was the architect of the chaos that surrounded the benefit payment card.
The hon. Lady is right to say that there is difficulty with delivering goods over the internet because fewer people are at home during the day. That is because 970,000 more people are in work as a result of our policies.
The hon. Lady talks about the views of sub-postmasters. We shall wait to hear what they say about this afternoon's announcement. I am confident that, as members of a reasonable organisation, they will warmly welcome my statement and the PIU report because they provide a real vision for the future of the Post Office.
The hon. Lady raises the important issue of transaction costs. We know that, at the moment, a transaction cost is paid by commercial agreement between the federation, the Post Office and the banks if they are acting as an agency. That will not change when a universal bank is introduced, but those bodies will enter into commercial negotiation.
Mr. Nick Gibb: What about the 17p?
Mr. Byers: The hon. Gentleman talks about 17p. In fact, for a pension the figure is 13p at the moment. He should get the facts right if he can. The figure will be part of the transactions entered into, and it is appropriate that that should be so.
We have made provision in the spending review to underpin the report's recommendations, and that will be made clear in July when we announce those proceedings.
The Conservatives' difficulties on the Post Office were very clear from the hon. Lady's response. Their policy was to privatise and break up the Post Office. We have given it commercial freedom and we will support modernisation and the development of new areas of
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business. The message for the Post Office and rural and urban communities that care about it is clear: neglect, decline and closures under the Conservatives; vision, investment and a future under Labour.
Mr. Frank Field: I warmly welcome my right hon. Friend's statement. Does he agree that the image that the media continuously put over of most vulnerable post offices being in the countryside is not totally accurate? Will he tell the House of his Department's analysis of measuring vulnerability by size of income that sub-post offices receive from social security transactions? On that analysis, do not the sub-post offices in his and my constituencies rank about 70th in the vulnerability league stakes? Will he therefore give an undertaking to those of us who represent inner-city areas that, when he gets down to the detailed implementation of his welcome announcement, he will pay particular attention to ensuring that inner-city post offices survive, as should rural post offices?
Mr. Byers: My right hon. Friend raises a very important point. In today's announcement, we draw particular attention to the important role that post offices play in deprived urban areas such as his constituency and mine, not just as a post office but as part of probably the only commercial retail outlet serving some of our most depressed estates. He is right to point out that they are the most vulnerable on the question of benefit transactions. We will be providing financial support to underpin post offices in those areas.
Many of my right hon. Friend's constituents and mine will be among the 3.5 million people who are unbanked and therefore cannot take advantage of direct debits and the cuts in bills for electricity, gas, the telephone and so on that that brings. The universal bank will, for the first time, allow those 3.5 million people to enjoy those benefits. The ability to enjoy the advantages of reduced basic utility bills, which many in this House take for granted, will make a huge difference to families and people on low incomes. Extending such benefits will be beneficial to individuals, communities and the Post Office as well.
Dr. Vincent Cable: I welcome the elements in the statement which give a firmer commitment to both public subsidy and the preservation of the network, and identify useful new sources of income generation. A similarly comprehensive approach adopted 20 years ago at the beginning of Conservative rule might have prevented the closure of many of the 4,000 branches which have closed.
How much of the lost £400 million income in 2003 will now be replaced by a combination of subsidy and new sources of income? I appreciate that the Secretary of State cannot identify the subsidy sum before the public expenditure review, but what will be the gap in the cash flow as a result of those two combined elements?
Secondly, can the right hon. Gentleman be more specific about his commitment to the preservation of the network? He said that there will be a guarantee for 10,000 sub-post offices. What will be the status of the other 8,000, many of which are loss-making? In particular, what is the status of those in urban areas, which have just been referred to? The right hon. Gentleman will have discovered in Tottenham last week that there is a lot of

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sensitivity about the closure of sub-post offices. Clearly, many of those will be modernised, but of those that are not, how many are likely to shut, and what provisions are there for preventing the closure of sub-post offices in inner-city areas?
Thirdly, will the right hon. Gentleman say more about what is meant by a jointly owned universal bank? What is the relative shareholding of the Government and the private banks? What will happen if a Barclays cash machine is installed in a sub-post office as part of the joint project? Will customers pay Barclays charges, which, as he knows, the bank is determined to impose in defiance of the anti-cartel provision of the Competition Act 1998?
Finally, I welcome the internet provision, particularly taking advantage of the logistics opportunities of the Post Office. But how will internet be provided in the many remote areas where there are no ISDN lines? How will the internet be universally available for the post office network?
Mr. Byers: The hon. Gentleman is right to say that, had our comprehensive approach been adopted some 20 years ago, the network would be in a far stronger condition than it is at present.
The hon. Gentleman raises a number of important questions. On the savings that will come from the movement towards ACT, clearly there will be an element of financial support to the network, which will be announced as part of the comprehensive spending review. We are confident that, coupled with the new areas in which the post office network will be able to develop—we mentioned three in particular on the basis of the PIU report—if there is any shortfall in the sums coming into the network, it can be made up by the new activities into which the post offices will be able to enter.
The hon. Gentleman made the point that some 10,000 post offices will be covered by the commitment that we have given to maintain the rural network. We calculate that probably 2,000 more will come within the category of urban deprived. The other areas will benefit from the new developments to which I have referred. There will be greater commercial opportunities for those post offices. In total, the package that we have put forward today has something to offer all 18,500 post offices presently in the network.
The Post Office and the major banks are discussing the detail of the universal bank. The Treasury, on behalf of the Government, has said today that high street banks that participate in the universal bank and make financial contributions towards its establishment would meet their financial exclusion obligations. That will make a big contribution to ensuring that the universal bank is a success.
I have asked the Post Office to present, by 1 September this year, a business plan giving details of how the universal bank will work in practice. In terms of internet access, once again I have asked the Post Office to present a report to me by the end of this year.
Several hon. Members rose—
Madam Speaker: Order. More than 40 hon. Members are seeking to catch my eye. I shall not be able to call anywhere near that number. I ask for brisk questions and answers from now on.
Mr. Martin O'Neill: I congratulate my right hon. Friend on the report. Some of us were worried when the Horizon project was substantially altered. Today's statement has dealt with most of our anxieties, and those who run post offices in rural and disadvantaged areas will have some hope. The package of support, the encouragement of diversification and the announcement about the universal bank are heartening.
I want to make a point about the record of Post Office Counters in negotiating with external bodies about franchised services. We all know about the loss of Powercard in the past couple of years, and the great disadvantages that that created for many of our constituents. I hope that my right hon. Friend, commercial freedom notwithstanding, will keep an eye on the rather macho approach that Post Office Counters sometimes takes in negotiations. I hope that we will not lose the opportunity of gaining access to important services through the Post Office because of the simplistic approach that Post Office Counters sometimes adopts.
Mr. Byers: My hon. Friend raises an important point. There is no doubt that, as we map out a programme of genuine change for the post office network, we need Post Office Counters managers who will be able to take advantage of the new opportunities. Some new management has already been put in place, and we are beginning to experience benefits from that.
The Powercard problem was a Scottish matter, but it shows the way in which mistakes can adversely affect post offices, communities and individuals. They should not be repeated in future. We will therefore ask the Post Office, with Post Office Counters, to prepare business plans and make detailed proposals so that the Government can ensure that we are discharging our responsibilities to the post office network and the communities that it serves. If we can move together in a genuine partnership, we shall be in a strong position to meet the challenges that lie ahead.
Mr. Peter Lilley: I am sorry that the Secretary of State chose to repeat a falsehood for which the Minister of State has already apologised to me.
Madam Speaker: Order. Perhaps the right hon. Gentleman will withdraw the word "falsehood" and select another word that is acceptable in parliamentary terms.
Mr. Lilley: I am sorry that the Secretary of State chose to repeat a statement for which the Minister of State has already apologised to me and the House. That statement conflicts with that made by his predecessor.
Let us now concentrate on the key issue. Will the Secretary of State tell the House whether sub-post offices will receive the same amount or less per transaction than they currently receive from the Post Office? Will the same number of transactions or fewer transactions be made? If sub-post offices receive the same revenues, from where will the savings come that the Secretary of State anticipates? If they receive less revenue, will not post office closures accelerate in future?
Mr. Byers: The right hon. Gentleman will know from experience the way in which the transaction costs are negotiated. He also knows that the Government are not

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involved in the details of the transaction costs of those commercial negotiations. There is no reason for post offices and sub-postmasters to receive less than they currently receive in transaction costs. Nothing in today's statement will lead them to receive less. It is a matter of commercial negotiation.
The right hon. Gentleman asked whether the number of transactions will diminish. That depends on whether the Post Office can persuade people to choose to have their benefits or pensions paid in cash at post offices. The individual will have that choice; that is perfectly appropriate. The right hon. Gentleman knows that the current order book system has massive potential for fraud. We calculate that approximately £100 million a year will be saved by preventing fraud through the introduction of the universal bank system. I hope that the right hon. Gentleman will be prepared to support that saving.
Mr. Gerald Kaufman: I note that my right hon. Friend's statement today would have been impossible if the Tory Government's plan to privatise the Post Office had gone ahead and I also note that the welcome given to the statement by the hon. Member for Twickenham (Dr. Cable) contrasts starkly with the lies spread in Liberal Democrat "Focus" documents about the Government forcing pensioners to collect their pensions from banks.
Will my right hon. Friend accept from me, as a representative of an inner-city constituency, that my constituents will welcome the increased facilities that will be available to people on low incomes and benefits and will be grateful for the fact that the support structure in inner cities for local sub-post offices will continue?
Mr. Byers: My right hon. Friend makes an important point. The post offices in inner-city areas provide a valuable resource to many constituents who need the support that a local post office can offer. I am pleased that the announcement that we have been able to make today can both address the understandable concerns of the rural network and, at the same time, discharge our responsibility for those people who live in our cities and towns. The announcement is a balanced response to a good analysis of the state of the network, and will offer new opportunities and a totally new vision for the Post Office for the 21st century.
Mr. Archy Kirkwood: As an officer of the all-party group, the importance of the core income of sub-postmasters was drilled into me at the recent lobby. Does the Secretary of State accept that the Government are likely to save annually between £400 million and £600 million? That core income must be replaced, somehow, after 2005. Like my hon. Friend the Member for Twickenham (Dr. Cable), I am prepared to give the statement a qualified welcome, but I was anxious about the answer given to the right hon. Member for Hitchin and Harpenden (Mr. Lilley) in which the Secretary of State said that the issue was nothing to do with him but with the Post Office. Does not he accept that if he does not drive Government business in the direction of the sub-post office network, it will wither on the vine whether he likes it or not?
Mr. Byers: The core income that sub-postmasters receive has been in decline for several years because
916
people have voluntarily chosen to move to ACT. The announcement today will enable us to ensure a greater diversity, so that new sources of income will reach the post office network. The hon. Gentleman knows that it is not for the Secretary of State to negotiate the transaction costs, because that is a commercial matter. I do not negotiate the pay of those working for the CWU or the pay of sub-postmasters and mistresses, because that would be inappropriate. What we can do is to ensure that the post office network is attractive and that people will wish to visit it for their transactions. The statement I have made today will achieve that.
On the specific point of government business, I am able to announce today that whenever government services are to be provided, the Post Office will be entitled to tender for that work. That has not been the case in the past, but from now on the Post Office will automatically be on the list, and that will make a big contribution.
Mr. Martin Salter: My right hon. Friend's statement is welcome news for many of the communities left high and dry by the decision of Barclays bank earlier this year to close 172 branches on one day, leaving 84 towns and villages bankless. The statement has the potential to provide a financial lifeline to communities facing financial exclusion. The all-party group on community banking, which it is my privilege to chair, has long argued for creative solutions to financial exclusion, using the existing post office network. In what way will the new and welcome universal bank differ from the Girobank, which was privatised by the Tories? If the Tories ever get their hands on power again, what guarantees will we have that the universal bank will not suffer a similar fate?
Mr. Byers: My hon. Friend has been a great champion of providing financial services to many communities, and he has done valuable work on exposing the actions of some high street banks. He is also right to point out that the strategy adopted by many banks gives the Post Office a golden opportunity to provide financial services to many individuals who are now denied them as a result of that strategy. The role of the universal bank will be quite different from that of Girobank, which has now been linked with Alliance and Leicester. Essentially, the universal bank will be geared to the 3.5 million people who are unbanked. Those who do not want to use it as a banking facility can simply access their benefits or their pensions at their local post office, but those who want to use it for a wider range of financial services will be able to do so. It will be a matter of choice and we believe that that is the appropriate approach.
Mr. Oliver Letwin: The statement does indeed sound good, but the Secretary of State will be aware that sub-postmasters and others have come to realise that there is sometimes a difference between how Government statements sound and their real meaning. How much will it cost to install the new technology that will be required for the new services at sub-post offices? Who will pay those costs?
Mr. Byers: The hon. Gentleman is right to point out the importance of working closely with the National Federation of Sub-Postmasters, which is what we have been doing. That is why I hope that it will feel able to welcome the announcement this afternoon.

917
The hon. Gentleman asked about the costs of installing the new facilities. It will cost over £500 million to provide the modern online computer facilities that will be in every post office by the spring of next year. As he will know from last week's Post Office accounts, some of that money will come from the Post Office and some from the Government. In terms of the additional facilities over and above the online computer facilities, as I made clear in the statement and in reply to hon. Members, I am asking the Post Office to present me with a business plan for the universal bank by 1 September, and for the other proposals by the end of this calendar year, so that we can see exactly how much will be required to deliver those new opportunities to the post office network.
Dr. Gavin Strang: I congratulate my right hon. Friend on rising to the challenge of creating a financial environment in which we can have a thriving and prosperous network of post offices. Is he aware that my constituents will particularly welcome the fact that he recognises that post offices in some of the less affluent urban areas are even more vulnerable than those in rural areas on the move to automated credit transfer? Those same constituents will attach huge importance to the potential of the universal bank which he has announced today. While recognising that the small print and the details of the agreement with the commercial banks will be produced later, is my right hon. Friend satisfied that he will reach an agreement with the private banks that will enable the universal bank to achieve its full potential to sustain the network? For example, will an individual who already has an account with a private bank be able to open an account with the universal bank?
Mr. Byers: My right hon. Friend is right to say that there are many aspects of today's announcement will be of real benefit to his constituents and to many other people living in inner-city areas. Much of the work conducted by the performance and innovation unit revealed that many of the 3.5 million people who do not have a bank account felt that a bank account was not appropriate for them for two main reasons: first, they felt that they were talked down to and they felt uncomfortable about going into a bank; and secondly, they did not want to get into debt as a result of having an overdraft facility. The reason why they liked the idea of a universal bank was that they trusted the Post Office and felt comfortable with it. They felt that they could trust the way in which the Post Office dealt with their affairs. People who already have bank accounts will be perfectly entitled to join the universal bank and they will be offered the whole range of financial services that the banking sector provides. Once again, that will be a matter of choice, but I am confident that the universal bank will open up a new direction in terms of offering financial services to many people who are presently excluded from many of the benefits that most of us take for granted.
Mr. Dafydd Wigley: The Secretary of State said that there would be a new fund to help post offices in deprived urban areas. Will he confirm that there will be a mechanism to give the same help to post offices in deprived rural areas? Does the ring-fenced money to
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which he referred apply equally to both urban and rural areas? Will he clarify conclusion 10 on page 89 of the report, which states that that ring-fenced fund will apply in England, but that similar arrangements in Scotland, Wales and Northern Ireland will be matters for the respective devolved Administrations? Will he confirm that any ring-fenced money will be additional for those areas, as it will be for England?
Mr. Byers: As to the position with regard to the devolved Administrations, I know that my right hon. Friend the Secretary of State for Wales is making an announcement this afternoon about how he intends to deal with these matters in Wales.
The ring-fenced funding has been negotiated in the context of the comprehensive spending review, and it will apply to Wales as well as England. The right hon. Member for Caernarfon (Mr. Wigley) is right to point out that targeted financial support must be supplied to deprived rural areas as well as to deprived urban areas, but that support will take different forms. The power to put subsidy into rural areas is contained in the new Postal Services Bill, but the fund for deprived urban areas is exclusively for those areas, and will be ring-fenced accordingly.
Dr. Lynne Jones: Proprietors of sub-post offices in my constituency are very worried about the declining value of their businesses. They tell me that they want not subsidy but proper recognition for the valuable service that they provide, much of which is on behalf of the Government. The measures announced today will go some way towards alleviating their concerns, but there is likely to be some delay in their implementation, and the report states that the universal bank concept needs more work.
In the meantime, business is being lost, and not only because people are choosing to move away from post offices. Sub-postmasters and mistresses in my constituency tell me that their customers say that staff at the Department of Social Security are misleading people into believing that their benefits must be paid into their bank accounts, even though they would prefer to have them paid at the post office.
I notice that the Minister of State with responsibility for pensions, my right hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker), is present, and I hope that he will talk to colleagues about how the Department can encourage its clients to opt for the universal bank. I hope, too, that the Department will recognise that there are security advantages to allowing people to collect benefits from a post office rather than from any branch of their bank.
Mr. Byers: My hon. Friend was right to say that postmasters and postmistresses do not want a subsidy. They want to make their businesses commercially viable by moving into new areas and diversifying into new facilities. The announcement that we have been able to make today will go a long way towards assisting them.
Today's announcement will also introduce to the network a new confidence that has been lacking over recent years. We have been able to lift the cloud of uncertainty that has hung over the post office network. People can now plan ahead with confidence, as they will know the direction the Government intend to take with the network.

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With regard to what my hon. Friend said about the Benefits Agency, we will make sure that benefit recipients and pensioners are made fully aware of the options and the genuine choice available to them. The big change on ACT does not begin until 2003, so there is a period in which we can make sure that the various initiatives are in place and functioning effectively. That is the challenge of the next few months, but I hope that today's statement will mean that many sub-postmasters and mistresses in my hon. Friend's constituency feel that they can plan ahead with confidence, in the knowledge that the network has a viable future.
Mr. Patrick McLoughlin: Since the House last debated post offices, I have been informed that the post office in Kirk Langley in my constituency is to close. Ten days ago, I was informed that the sub-postmistress at Brassington, who had her home converted to run the post office, has received a communication from the Post Office about reducing her wage substantially. What comfort will the Secretary of State's statement today bring to the proprietors of those two post offices?
Mr. Byers: If the Kirk Langley and Brassington post offices serve rural communities, they may well be covered by the proposals that I have introduced in connection with the protection and maintenance of the rural network. I cannot guarantee that, as I have not seen the details of the cases to which the hon. Gentleman refers, but people who read the statement will accept that there is much in it that will give reassurance to the rural network in the future.
The problems being experienced by Kirk Langley and Brassington have nothing to do with our proposals to move to ACT from 2003 onwards. They are already having difficulties. That is one of the reasons why we wanted to make the statement today—to instil some confidence in the system. I hope that in the future the
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problems experienced in Kirk Langley and Brassington will be overcome, but I regret that it may be too late for those two particular post offices.
Mr. Alan W. Williams: I welcome the my right hon. Friend's statement, particularly the proposals for a universal bank for sub-postmasters and sub-postmistresses to carry out a Government general practitioner role. In that context, could they also have a role as welfare benefits advisers? Sub-postmasters are in touch with the poorer sections of the community. With regard to the elderly, sub-postmasters probably know more about care allowance, attendance allowance and the minimum income guarantee than, say, Thora Hird, and such a step could be very cost-effective. Could post office employees be paid to alert the Department of Social Security to benefit fraud?
Mr. Byers: When the role of a Government general practitioner is brought forward and we can see the detail, we will be looking at the areas mentioned by my hon. Friend with great interest. We will want to know to what extent sub-postmasters and postmistresses can be trained to give good quality advice about the welfare benefits system and a whole range of other issues. They are in an ideal position to act as the interface between the Government and individuals in many communities up and down the country. Post offices provide a network that can form the backbone of communication between the Government and citizens. They have not been used in that way in the past.
The report that we have today and the Government's response to it will ensure that the Post Office network can grow in the future and move in different directions, in a way that I believe will provide greater satisfaction to many sub-postmasters and postmistresses who want to develop a Government service role.
Several hon. Members rose—
Madam Speaker: Order. We shall obviously be coming back to this subject. We must now move on.

Points of Order
4.22 pm
Mr. Peter Lilley: On a point of order, Madam Speaker. First, I apologise for having used an improper word, but is there any precedent for a Secretary of State failing to apologise for repeating a statement for which his own deputy has previously apologised to the House?
Madam Speaker: I fear that that is barely a point of order for me. I can well understand that there are some problems and difficulties with exchanges across the Floor of the House from time to time, and 1 refer hon. Members, as I did yesterday, to the wise words of "Erskine May" about good temper and moderation in our language. I hope that Front Benchers will have heard what the right hon. Gentleman said, and will take his point to heart.
Mr. Humfrey Matins: On a point of order, Madam Speaker. I am not sure whether this is a point of order, but I hope that it is. The whole House will have heard the Secretary of State say in his statement that the importance of the Post Office cannot be underestimated. It is clear that the right hon. Gentleman must have meant "overestimated". He may want to correct that, because Hansard is bound to record what he said—namely, that its importance cannot be underestimated.
Madam Speaker: The hon. Gentleman is being very helpful to us all, as well as to Hansard.

House of Commons (Reserved Matters)
4.23 pm
Mr. Frank Field: I beg to move,
That leave be given to bring in a Bill to prescribe which Members of the House of Commons may participate only in proceedings on reserved matters under the Scotland and Northern Ireland Acts 1998 or may be appointed only to a ministerial office having responsibility for such matters.
I also hope to overestimate the importance of this Bill. It is the next stage in the devolution path on which the Government have set forth. Early on in this Parliament, the Government enacted their key election manifesto pledges of devolving power to Scotland and Northern Ireland and, in a more limited respect, to Wales. Nobody who participated in that debate could believe that it was a one-off measure—that somehow we would be so clever, in a Parliament's early stages, to see through all the moves that would be necessary to ensure the success of such a programme. Indeed, those with more insight and wisdom than I prophesied as we began the debate that we were moving from a unitary to a federal state. The Bill that I seek leave to introduce today is another small, important step on that journey.
The Bill seeks the authority of the House to create two powers. The first is to make Members from Northern Ireland and Scotland unable to vote in this House on matters that have been devolved to their Parliaments. In a second respect, the Bill seeks to limit the power of Members for seats in Scotland and Northern Ireland to hold United Kingdom Ministries, where the relevant powers have been devolved to their regional Parliaments.
The Bill also has, as hon. Members would expect, a clear timetable. We were elected to this Parliament on a mandate to put through devolution without changing our own powers. The Bill does not seek to change those powers, but it sets out a timetable by which we might legislate in the next Parliament so that the legislation would become effective in the Parliament after that.
A major purpose of the Bill is to initiate a debate. Already, it is beginning to have some effect. So hon. Members will not be surprised if I address myself to what are called the main objections that have already arisen from some people who are concerned about the next stage of devolution: people whose nerve appears to be cracking in following the path on which we are safely set.
First, I am told quite correctly that when I was a Minister I did not vote against the devolution proposals. Some of the older Members here will know that, in government, the choice that one has is to be part of the payroll vote or to resign. I chose to resign on a different issue, but I hope that many of my colleagues on this side of the House appreciate the opportunity that they have now, as opposed to then, when we were compelled to vote on a three-line Whip. I am not sure what the Whips are planning for this afternoon, but in theory there will be a free vote. Hon. Members may thus be able to express their views more accurately than they did when we discussed the matter earlier in this Parliament.
Another objection is why I am raising this issue now. It is not an issue which is present in everyday politics. As Members of Parliament, we have a crucial duty both to attend to the immediate issues that affect our constituents and to consider those issues that are beginning to appear on the radar screen, and to try to deal with them so that

923
we do not sour the nature of our politics. Who would have thought that, already, the issue of fox hunting would be raised within the framework of whether Members of Parliament for Scottish seats, whose own Parliament will decide the issue for Scotland, should be able to vote in this House on fox hunting in England and Wales? The legal position is clear for all to see: Scottish Members have every legal right to vote when we come to consider fox hunting for England and Wales. Whether they would be wise to exercise that vote is another matter.
Another objection to the Bill is that it creates two tiers of Members of Parliament, but the clear fact is that we already have at least two tiers of Members. The Bill leaves the powers of this Parliament untouched. I suppose that our constituents will yawn slightly on hearing Members of Parliament say that the Bill creates two tiers of Members of Parliament. I hope that they will forgive us for being so egocentric. For they might say, not that we already have two tiers of Members of Parliament, but that we have created from the Act already on the statute book two tiers of voters. Between national Parliaments and the UK Parliament, we shall see increasingly what we see locally: people vote one way for their local council and a different way for their national MP. That will occur increasingly in voting patterns in Scotland and Northern Ireland and for this place.
The final argument that has been made shocks me. It is: "Why are you so foolish as to introduce this measure? May there not come a time when we will need the votes of Scottish Members to put through a programme affecting English Members that a Labour Government would not be able to carry without those Scottish Members?" The test is simple. Do we give our loyalty primarily to our party? All of us have some, or great, loyalty to our party. Or is our loyalty primarily to the democratic system that we have inherited and that we have a duty to hand on?
Devolution is a Labour issue. I am pleased to see so many Opposition Members in the Chamber, but when we were discussing devolution, they opposed every word, every clause, every line and every page of the legislation. As we know, there is great rejoicing in heaven over the sinner who repents. There is clearly a party breaking out up there at the repentance of the Opposition.
Before anyone tries to prevent us from continuing the debate on the Bill, may I issue one warning? The Tory wasps are beginning to swarm around our hive, which contains the devolution honey. Are we going to let the wasps have it, or shall we take the measure safely towards its logical conclusion? The logical conclusion is that we should debate it today and continue the debate thereafter.
At this stage, the aim of introducing the Bill is, of course, not to try to get it on the statute book; it is that we shall be able—in our own ways—to influence our parties and the programme that they propose for our re-election to the next Parliament. I emphasise that the Bill would not change the powers of Members in this Parliament; it will prevent a feeling of unfairness among voters in England and Wales who, as time goes on, will feel that, however great our devolution programme has been, it remains incomplete. Who better to complete that programme than those Labour Members who had the courage to initiate it?
4.33 pm
Mr. David Curry: I beg to oppose the Bill. The proposal of the right hon. Member for Birkenhead (Mr. Field) is beguiling, even seductive. There is an implacable logic to his analysis.
The right hon. Gentleman is right to imply that, in their haste to head off, contain and discipline Scottish and Welsh nationalism, the Government have left unaddressed the question of the position of England. Given the existence of a Scottish Parliament, he is right that the position of Scottish MPs in the House is anomalous and, to some people, perhaps even provocative. He is right to accept that, just because a majority is, in general, tolerant and at ease with itself and its identity, its own rights should not be left unattended.
However, he is wrong in his prescription. He is wrong because his proposals would create two Parliaments within the one body—Parliaments with different majorities, different ambitions and competing and contested legitimacies. The proposal would create an English Parliament—a haphazard, accidental creation within the body of the UK Parliament.
There may be a case for an English Parliament, although I am not sure that I share the Arthurian reveries of some of the people who regularly gather to display the flag of St. George at the approach to this place. If there is to be an English Parliament, it must be a deliberately created one—apart and separate from this House; it must have an undisputed legitimacy so that this place is uncompromised as the forum for debating the British interest. The Parliament itself must be the creation of deliberate policy, not of procedural accident.
Create an English Parliament if you want one, Madam Speaker, and, if you like, put it in Winchester. Even better, put it in York. If you like, dare I say it, put it in Liverpool. But do not demean, denature and destroy this place by imposing on it an institutional schizophrenia. However much we pretend otherwise, we would also be creating an English Government—a sort of bastard Government not born in its own right.
Let us imagine a situation which the right hon. Gentleman has mentioned, where the withdrawal of Scottish MPs left a majority on English matters in the House different from that of the UK Government. One would then, necessarily, end up with a Government elected on a manifesto significant parts of which they could not deliver, and a competing Administration, unable to deliver their manifesto because they would not command the business of the House, and would therefore depend on the opportunistic hijacking of Government proposals.
The most persuasive claim made in support of our system of elections is that it delivers firm government. The proposal in the Bill to graft an English Parliament on to a UK Parliament with competing aims, programmes and majorities would spell incoherence at best and, literally, incompetence at worst. If we want an English Government, let us have a genuinely federal system, with four national Parliaments and Administrations, together with a UK-wide Parliament for non-devolved matters—not the disfigurement of this Parliament and the deliberate disabling of its Government.
I am English—according to my French wife, very English. I feel comfortable in my skin; I do not feel threatened, and although I might grumble about such

925
things as per capita spending in Scotland when compared with that in England, I do not feel abused by the differential. I do think that we should beware of the dangers of the aggressive assertion of the English interest expressed as a political mechanism.
We English are not a minority in these islands; we do not have an identity to prove or a history to rescue. When a federation exists in which there is a massive disequilibrium between the size and weight of one of its components and the others, there is a particular responsibility on the dominant partner to behave with restraint.
I do not believe that the Union is at risk from Scottish nationalism if that nationalism is left to sustain its own momentum and renew its own energy, if it can; but give it the adrenalin of an assertive English nationalism against which to identify itself, and I do fear that we shall be providing the weapon for an assault on the integrity of the Union.
The politicisation of English nationalism will risk making the disequilibrium at the heart of our federation of UK nations, which devolution, however clumsily and self-interestedly, has sought to address, unsustainable. We do need to reflect on the nature of the Anglo-Scottish relationship, about which, to be honest, I am not even remotely sentimental. We have already, through devolution, created structures that need to negotiate with one another to co-exist—resulting in the plethora of concordats that lie at the heart of the relationship between the different parts of the United Kingdom. If we exclude Scottish MPs from our deliberations on purely English affairs—assuming that those can be isolated and defined, which I doubt—we go one stage further in putting intergovernmental relations at the heart of British governance. We shall appropriate the idea that the UK is made up of foreign countries. Worse, we could let loose forces which, if ruthlessly exploited, could makes us strangers to ourselves.
Question put, pursuant to Standing Order No. 23 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of public business):—
The House divided: Ayes 131, Noes 190.

Division No. 242]

[4.39 pm

AYES

Ainsworth, Peter (E Surrey)

Clappison, James

Amess, David

Clark, Dr Michael (Rayleigh)

Arbuthnot, Rt Hon James

Clifton-Brown, Geoffrey

Baldry, Tony

Collins, Tim

Beggs, Roy

Cormack, Sir Patrick

Bercow, John

Cran, James

Beresford, Sir Paul

Dalyell, Tarn

Blunt, Crispin

Davies, Rt Hon Denzil (Uanelli)

Body, Sir Richard

Davies, Quentin (Grantham)

Boswell, Tim

Davis, Rt Hon David (Haltemprice)

Bottomley, Peter (Worthing W)

Day, Stephen

Brady, Graham

Donaldson, Jeffrey

Brazier, Julian

Dorrell, Rt Hon Stephen

Brooke, Rt Hon Peter

Duncan Smith, lain

Browning, Mrs Angela

Emery, Rt Hon Sir Peter

Bruce, Ian (S Dorset)

Evans, Nigel

Bums, Simon

Fabricant, Michael

Butterfill, John

Fallon, Michael

Chope, Christopher

Field, Rt Hon Frank

926

Forth, Rt Hon Eric

May, Mrs Theresa

Fraser, Christopher

Moss, Malcolm

Gale, Roger

Norman, Archie

Gamier, Edward

O'Brien, Stephen (Eddisbury)

Gibb, Nick

Ottaway, Richard

Gill, Christopher

Page, Richard

Godman, Dr Norman A

Paice, James

Gorman, Mrs Teresa

Paterson, Owen

Gray, James

Pickles, Eric

Green, Damian

Portillo, Rt Hon Michael

Greenway, John

Prior, David

Grieve, Dominic

Randall, John

Gummer, Rt Hon John

Robathan, Andrew

Hague, Rt Hon William

Robertson, Laurence

Hamilton, Rt Hon Sir Archie

Roe, Mrs Marion (Broxboume)

Hammond, Philip

Rowe, Andrew (Faversham)

Hawkins, Nick

Ruffley, David

Hayes, John

St Aubyn, Nick

Heald, Oliver

Sayeed, Jonathan

Heathcoat-Amory, Rt Hon David

Shepherd, Richard

Horam, John

Smyth, Rev Martin (Belfast S)

Howard, Rt Hon Michael

Soames, Nicholas

Howarth, Gerald (Aldershot)

Spicer, Sir Michael

Hunter, Andrew

Spring, Richard

Jack, Rt Hon Michael

Stanley, Rt Hon Sir John

Jenkin, Bernard

Steen, Anthony

Key, Robert

Swayne, Desmond

King, Rt Hon Tom (Bridgwater)

Syms, Robert

Kirkbride, Miss Julie

Taylor, Ian (EsherS Walton)

Lait, Mrs Jacqui

Taylor, John M (Solihull)

Lansley, Andrew

Taylor, Sir Teddy

Leigh, Edward

Thompson, William

Letwin, Oliver

Tredinnick, David

Lewis, Dr Julian (New Forest E)

Tyrie, Andrew

Lidington, David

Viggers, Peter

Lilley, Rt Hon Peter

Walter, Robert

Uoyd, Rt Hon Sir Peter (Fareham)

Whitney, Sir Raymond

Loughton, Tim

Whittingdale, John

Luff, Peter

Widdecombe, Rt Hon Miss Ann

Lyell, Rt Hon Sir Nicholas

Willetts, David

Mclntosh, Miss Anne

Williams, Rt Hon Alan

MacKay, Rt Hon Andrew

(Swansea W)

Maclean, Rt Hon David

Wilshire, David

McLoughlin, Patrick

Wright, Tony (Cannock)

Madel, Sir David

Young, Rt Hon Sir George

Malins, Humfrey

Maples, John

Tellers for the Ayes Mr. Peter Atkinson and Mr. Michael Connarty.

Marshall-Andrews, Robert

Maude, Rt Hon Francis

NOES

Abbott, Ms Diane

Butter, Mrs Christine

Adams, Mrs Irene (Paisley N)

Cable, Dr Vincent

Ainger, Nick

Campbell, Rt Hon Menzies

Alexander, Douglas

(NEFife)

Anderson, Donald (Swansea E)

Campbell, Ronnie (Blyth V)

Ashton, Joe

Campbell-Savours, Dale

Atkins, Charlotte

Casale, Roger

Austin, John

Chapman, Ben (Wirral S)

Baker, Norman

Chidgey, David

Banks, Tony

Church, Ms Judith

Barron, Kevin

Clark, Rt Hon Dr David (S Shields)

Beard, Nigel

Clark, Paul (Gillingham)

Begg, Miss Anne

Clarke, Eric (Midlothian)

Bell, Stuart (Middlesbrough)

Clarke, Rt Hon Tom (Coatbridge)

Bermingham, Gerald

Clarke, Tony (Northampton S)

Best, Harold

Coaker, Vemon

Blizzard, Bob

Cohen, Harry

Borrow, David

Cook, Frank (Stockton N)

Bradley, Peter (The Wrekin)

Corbett, Robin

Brand, Dr Peter

Corston, Jean

Breed, Colin

Cotter, Brian

Brown, Russell (Dumfries)

Cousins, Jim

Browne, Desmond

Crausby, David

Buck, Ms Karen

Cryer, John (Homchurch)

Burstow, Paul

Curry, Rt Hon David

927

Davey, Edward (Kingston)

Jones, Helen (Warrington N)

Davidson, Ian

Jones, Jon Owen (Cardiff C)

Dobson, Rt Hon Frank

Jones, Martyn (Clwyd S)

Donohoe, Brian H

Kaufman, Rt Hon Gerald

Eagle, Maria (L'pool Garston)

Keen, Ann (Brentford & Isleworth)

Edwards, Huw

Keetch, Paul

Ellman, Mrs Louise

Kemp, Fraser

Ennis, Jeff

Kennedy, Rt Hon Charles

Feam, Ronnie

(Ross Skye & Inverness W)

Fitzpatrick, Jim

Khabra, Piara S

Foster, Michael J (Worcester)

Kitfoyle, Peter

Gardiner, Barry

Kingham, Ms Tess

George, Andrew (St Ives)

Lammy, David

George, Bruce (Walsall S)

Lawrence, Mrs Jackie

Gerrard, Neil

Laxton, Bob

Gilroy, Mrs Linda

Lepper, David

Godsiff, Roger

Leslie, Christopher

Goggins, Paul

Levitt, Tom

Gordon, Mrs Eileen

Lewis, Ivan (Bury S)

Griffiths, Nigel (Edinburgh S)

Livsey, Richard

Grogan, John

Llwyd, Elfyn

Gunnell, John

Love, Andrew

Hall, Patrick (Bedford)

Macdonald, Calum

Heath, David (Somerton & Frome)

McFall, John

Henderson, Doug (Newcastle N)

Mclsaac, Shona

Hepburn, Stephen

Maclennan, Rt Hon Robert

Heppell, John

Mactaggart, Fiona

Hinchliffe, David

McWalter, Tony

Hood, Jimmy

Marek, Dr John

Hope, Phil

Marsden, Gordon (Blackpool S)

Hopkins, Kelvin

Marshall, David (Shettleston)

Hoyle, Lindsay

Martlew, Eric

Hughes, Simon (Southwark N)

Maxton, John

Hurst, Alan

Merron, Gillian

Illsley, Eric

Michael, Rt Hon Alun

Jackson, Ms Glenda (Hampstead)

Michie, Bill (Shefld Heeley)

Jackson, Helen (Hillsborough)

Mitchell, Austin

Jenkins, Brian

Moffatt, Laura

Jones, Rt Hon Barry (Alyn)

Moore, Michael

928

Morgan, Ms Julie (Cardiff N)

Smith, Sir Robert (WAb'd'ns)

Mudie, George

Soley, Clive

Murphy, Jim (Eastwood)

Squire, Ms Rachel

Oaten, Mark

Steinberg, Gerry

O'Brien, Bill (Normanton)

Stevenson, George

Olner, Bill

Stewart, David (Inverness E)

Opik, Lembit

Stewart, Ian (Ecdes)

Pickthall, Colin

Stoate, Dr Howard

Pike, Peter L

Stunell, Andrew

Plaskitt, James

Tapsell, Sir Peter

Pollard, Kerry

Taylor, David (NW Leics)

Pound Stephen

Tay|or. Matthew (Truro)

Powell, Sir Raymond

Thomas, Gareth R (Harrow W)

Prentice, Ms Bridget (Lewisham E)

Tumer, Dr George (NW Norfolk)

Quinn Lawrie

Tumer, Neil (Wigan)

Raynsford, Nick

Twigg, Derek (Halton)

Reed, Andrew (Loughborough)

Tyler, Paul

Rendel, David

Tynan, Bill

Robinson, Geoffrey (Cov'try NW)

Watts, David

Ross, Ernie (Dunolee W)

Webb, Steve

White, Brian

Ruane, Chris

Whtehead, Dr Alan

Williams, Alan W (E Carmarthen)

Ruddock, Joan

Williams, Mrs Betty (Conwy)

Russell, Ms Christine (Chester)

Willis, Phil

Salter, Martin

Wilson, Brian

Savidge, Malcolm

Winnick, David

Sawford, Phil

Winterton, Ms Rosie (Doncaster C)

Sedgemore, Brian

wood, Mike

Sheerman, Barry

Woodward, Shaun

Shipley, Ms Debra

Wright, Anthony D (Gt Yarmouth)

Skinner, Dennis

Smith, Angela (Basildon)

Tellers for the Noes: Mrs. Eleanor Laing and Mr. Tom Brake.

Smith, Miss Geraldine

(Morecambe & Lunesdale)

Question accordingly negatived.

Orders of the Day

  Limited Liability Partnerships Bill
  [Lords]
  As amended in the Standing Committee, considered.

New Clause 2

  RETURNS TO REGISTRAR
  '.—(1) Each limited liability partnership shall make an annual return to the registrar setting out—

  (a) all claims made against the partnership for work performed by it;

  (b) a statement by the relevant regulator that the partnership has complied with the relevant regulatory framework in its field of business; and

  (c) the average rate of pay for the partnership's employees in the top and bottom quartiles (in terms of remuneration).

  ()(2) Any returns or reports made by limited liability partnerships to the registrar shall be made available for public inspection.'.—[Mr. Mitchell.]

  Brought up, and read the First time.
  4.52 pm
  Mr. Austin Mitchell: I beg to move, That the clause be read a Second time.
  Mr. Deputy Speaker (Mr. Michael Lord): With this it will be convenient to discuss the following: New clause 4—Report of regulatory infractions and censures—
  '.—Limited liability partnerships trading outside the United Kingdom shall report to the registrar all infractions of regulatory rules and all censures by regulators in other jurisdictions.'.
  New clause 7—Disclosure of emoluments—
  '.—Any limited liability partnership in which the amount of profit before member remuneration and profit share exceeds £200,000 shall publish details of director emoluments comparable in detail to those required of companies by Schedule 6 to the Companies Act 1985.'.
  New clause 8—Statement of assets, etc.—
  '.Each limited liability partnership shall, when filing annual accounts with the registrar, submit a statement showing—

  (a) the value of the net assets of each partner; and

  (b) whether any partner is at that time involved in litigation.'.

  Amendment No. 19, in clause 6, page 3, line 35, at end insert—
  '(2A) A statement of the scope of authority to act of each member shall be lodged with the registrar, displayed in all partnership offices and made available to clients.'.
  Amendment No. 24, in clause 9, page 5, line 7, after "days", insert—
  'giving full details of the address, financial and property interests and other trading activities of new designated members, and, in the case of those ceasing to be designated members, the reasons why they are leaving'.
  Mr. Mitchell: Let me make it clear, as I did on Second Reading, that I do not like the Bill in any way. Essentially, it gives a dodgy, dirty deal to fat-cat accountancy practices, and that should not be the responsibility of the Labour party and a Labour Government. I find the speed with which the deal is being done even more reprehensible, when we are not making any special
  930
  concessions to trade unions or friends of the party. Indeed, many of our party's friends in local government, education and the union movement are being treated as the enemy within, while we are giving a dirty deal to accountancy houses.
  The big accountancy houses have been pushing for this Bill, and have gone to extreme lengths to get it. The process was begun by the Conservative Government, and while it is perfectly right for a Labour Government to pursue that process, it is not right to introduce the Bill at this speed and this early in the legislative programme without countervailing concessions.
  As a prelude to the long list of amendments that I shall move, I say to the House that I am resentful of the way in which my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cousins) and I have been treated. We wanted to be on the Standing Committee, but we were not, and it would have been appropriate to have argued all this out in Committee rather than on the Floor of the House, when another, welcome Bill follows and we are under great pressure to shut up. I do not think that things should be done like that. The Hansard Society is to have a committee on the scrutiny of legislation, and I shall write a case study in which the Bill is an example of how not to scrutinise legislation. Instead of giving you my paranoia, Mr. Deputy Speaker, I shall deal with the new clause.
  The general principle behind all the new clauses and amendments that I have tabled is consumer protection and ensuring that more information can be made available to the consumers of audit and insolvency services and all the other services that accountancy houses provide, because the Bill will protect accountants from the consequences of their own failure. If they carry out a bad audit—which often comes to light only when a firm fails—because they are so busy selling other services to the firm that they neglect or dilute the audit, they should be accountable in full for the consequences. If an insolvency is protracted, which does not serve the interests of the creditors because the insolvency practitioner owes no duty of care to them, they should also be accountable in full.
  We are making a concession to the big accountancy houses without introducing any effective, independent regulation of accountancy and insolvency firms. We promised in our business manifesto that we would have full, independent regulation. We are not fulfilling that commitment; via so-called independent regulation, we are, classically, merely adding yet another layer to the existing chaos of regulation. There are eight regulators for 1,800 practitioners in insolvency. That is absolutely ludicrous, yet we are adding another layer above those eight. We are not providing independent regulation.
  Mr. Michael Fabricant: I was listening to the hon. Gentleman's argument with great interest, but I left the Chamber briefly to find out how he voted on Second Reading. Of course he did not vote because there was no Division. I wonder whether he is against the principle of the Bill. I shall ask him a hypothetical question: if there had been a Division, would he have voted against the Bill?
  Mr. Mitchell: Probably I would have voted against the Bill on Second Reading, but there was no Division.
  How would I have pursued the Bill's aims? As I said in my introductory remarks, during which the hon. Gentleman left to find out information that was obvious

  931
  to everyone else, it was right to pursue the Bill's aims because the Conservative Government—our predecessors—had started to develop such legislation. I am a Fabian in such matters. Festina lente is the slogan.
  Let us make progress with the Bill while introducing corresponding concessions to protect consumer interests and a corresponding framework of legislation to ensure that those accountancy firms that opt to become limited liability partnerships are accountable. That is the essence of my argument. Protection for consumers means providing a duty of care, which I shall attempt to do under later amendments, and reversing the Caparo judgment.
  The basic principle behind all the amendments and new clauses that I have tabled, especially in this group, is that there should be maximum publication and recording of the available information because partnerships are inherently secretive organisations. There can be many variations of partnership and individual agreements.
  Mr. John Burnett: What makes a partnership more secretive than a sole trader?
  Mr. Mitchell: I am not comparing partnerships with sole traders. We are talking about bigger organisations than sole traders. The accountancy houses were allowed to set up as limited companies under the Companies Act 1989, but only one accountancy house did so. Why? First, there are tax disadvantages in becoming a limited company. Secondly, there are publicity disadvantages; they have to disclose more information. They do not want to disclose. They are secretive, powerful organisations.
  I want more disclosure. I want more light; it is as simple as that. The consumer has a right to know. People who might be affected by the business or insolvency of limited liability partnerships have a right to know what their strengths and weaknesses are, so they should be subject to exactly the same disclosures as a public limited company, as was provided for in the Companies Act.
  5 pm
  Another consideration behind the amendments, particularly this group of amendments, is the need to avoid fraud and tax fiddles. It is possible for all kinds of dodgy organisations to register as limited liability partnerships. The words "dodgy organisations" bring to mind Yorkshire Water, now the Kelda Group. It is attempting to perpetrate what must be a deceit upon its shareholders: a process of so-called mutualisation to pass on assets that do not yield much profit to the shareholders. It will then offer itself as a management company to run the assets for a fee.
  That must be a monstrous deceit of the consumer. One of my later amendments seeks to preclude it all together, saying that publicly regulated utilities should not have such a facility. I mention that in passing because the main problem is the use of those organisations to reduce the tax burden and to perpetrate fraud and tax fiddles. The transfer to limited liability status gives rise to that.
  I am glad that the Minister, in his many answers to my many questions, communicated that fact. I have also written to the Chancellor of the Exchequer about the matter. Rightly, the tax regulation differences between partnerships and limited companies is now being reviewed. They should be aligned as closely as possible.
  932
  Why are we pushing for the legislation to be implemented before that review has been completed? People need to know what the tax benefits or disadvantages may be. In my view, there could be disadvantages—or there should be—in transferring, so I do not want the legislation to be implemented before the tax review has ended.
  Mr. Fabricant: The hon. Gentleman is presenting a powerful argument as to why he opposes the principle of the Bill. I understand where he is coming from, but I am a little confused in one respect. He said in answer to my earlier question that, had there been a Division, he probably would have voted against Second Reading. He makes it clear that he is against the principle of the Bill. Why, then, did he not call for a Division on Second Reading, so that he could vote?
  Mr. Deputy Speaker: Order. I urge the hon. Member for Great Grimsby (Mr. Mitchell) not to be seduced into a Second Reading debate.
  Mr. Mitchell: Thank you for warning me, Mr. Deputy Speaker. I was not going to follow the hon. Member for Lichfield (Mr. Fabricant) down the path of his ignorance of parliamentary procedure and the role of amendments on Report—the stage of the Bill's proceedings in which I am participating.
  Mr. Fabricant: On a point of order, Mr. Deputy Speaker. I wonder whether you could explain something to me and for the benefit of the House: am I not right that someone can call for a Division if he is a Member of the House?
  Mr. Deputy Speaker: That has nothing to do with the matter that is before the House.
  Mr. Mitchell: Thank you, Mr. Deputy Speaker. The hon. Member for Lichfield should not raise silly, querulous points during my speech. He would have done better to use his position on the Committee to raise some serious points there, instead of fighting to extend the vested interests and privileges of the big accountancy houses. That was the essence of what he was doing on the Standing Committee, which had only one Division, and in which Opposition Members promoted those vested interests. It is a little nitpicking, to say the least, of him to raise those points with me, having failed to fulfil his own responsibilities on the Standing Committee. However, I do not intend to follow that argument.
  I was saying that the measure should not be implemented until the review of the tax status of partnerships and companies is completed; only then should it come into effect. I wish to raise many points and to warn off the hon. Member for Lichfield, who has interjected three times in an attempt to prolong my speech and who does not seem able to count, either. I point out that this argument is, in essence, about the consumer and about the soul of the Labour party and the Labour Government.
  Conservative Members had their opportunity in Standing Committee and earlier to represent the views of the vested interests, and they did that very articulately. Indeed, Liberal Members, who are now engaged in hasty consultation at the last minute, also did that. It was a shame on Second Reading to hear the Liberal spokesman

  933
  speaking for professional vested interests when the only effective opposition in the House of Lords came from Liberal Democrats and particularly from Lord Phillips of Sudbury who appears on the Jimmy Young show.
  Mr. Deputy Speaker: Order. The hon. Gentleman is again distracting the House from the new clause that he is supposed to be moving. Will he please address his remarks to new clause 2 and to the other new clauses and amendments that we are legitimately discussing?
  Mr. Mitchell: I am grateful to you, Mr. Deputy Speaker, for bringing me back to the path of virtue.
  Mr. Burnett: Will the hon. Gentleman give way?
  Mr. Mitchell: I will not give way on this point, because I think I can anticipate the hon. Gentleman's objection. It will lead me down a path along which I do not want to go.
  On new clause 2, Ministers said that limited liability partnerships would be treated as companies. In fact—and this is the purpose of the new clause—they have been treated more leniently. When a company prepares its accounts, it must indicate its contingent liabilities under accounting standard SS18, which accounts for contingencies. It is right that companies should do that, because anyone to whom a company owes money or supplies services will want to know its liabilities. To decide on the financial standing of a company, people need to know its contingent liabilities. That protects creditors and suppliers and it provides information to the public.
  It is important to bring LLPs into line with companies, because partnerships have few assets. All the assets of a company are in its name, and creditors can try to get hold of them if it becomes insolvent. That is not so with a partnership, which tends to have few assets and the case has to be pursued against the negligent partner. I hope to come to the issue of how people will decide who is the negligent partner and how he will be designated, because such information should be available. However, creditors find that much less is up for grabs in a partnership than it is in a company. The two entities should be aligned with each other. Initially, we were told that they would be, but that has not occurred. New clause 2 would achieve that aim.
  New clause 4 is about compliance with foreign rules. That is important. In the United States, the Securities and Exchange Commission—which is the most effective independent regulator in the world and the type of body that we should have in this country—is making a concerted attempt to force differentiation in the big accountancy houses between the audit arm and the service arm. If the audit arm sells services to its audit clients, that dilutes the effectiveness of the audit by making the firm more compliant to the wishes of the directors selling the services. That creates an undesirable vested interest if we are to have effective and independent audits. That shows the importance of complying with foreign rules. Such an attempt is being made in the United States, and it will come to fruition. Already, the SEC, which is not satisfied with professional self-regulation as it exists in the United States, has produced a scathing report on PricewaterhouseCoopers.
  934
  The interesting finding from the SEC inquiry was the amount of negligence that exists. In two years, there were 8,000 violations of basic principles of accountancy and audit, particularly partners and employees of PricewaterhouseCoopers holding shares in companies that were being audited by PricewaterhouseCoopers. Eight thousand violations! The report stated that there were
  serious structural and cultural problems
  in PricewaterhouseCoopers' compliance in these matters. In other words, the firm did not give a damn. It was negligent, there was a culture of laxness in the organisation, and it violated the rules of the industry. That report was an eye-opener to—
  Mr. Deputy Speaker: Order. May I gently remind the hon. Gentleman that he has tabled new clause 3, which deals with the United States, the Securities and Exchange Commission and so on? I am happy for him to pursue his argument now, as long as he does not repeat it when he comes to new clause 3.
  Mr. Mitchell: The matter is better dealt with now, Mr. Deputy Speaker. I shall mention it only briefly later.
  That inquiry has extended to other firms, and there is a concerted attempt to prise the audit arms apart. We should be inquiring in the same way. In my view, the big accountancy houses are far too friendly with Government. I saw in The Observer on Sunday that since the election, PricewaterhouseCoopers, Ernst and Young, and Pannell Kerr Foster had all donated staff to the Treasury to draw up tax legislation. We do not have panels of criminals coming in to advise the Home Office on the criminal law or police methods, but in the case that I mentioned, the interested parties are being brought in to advise Government.
  Mr. Stuart Bell: On a point of order, Mr. Deputy Speaker. Although my hon. Friend is perfectly right to put his case, is he entitled to say that the largest and most reputable accountancy firms in our country are criminals?
  Mr. Mitchell: If my hon. Friend had listened—
  Mr. Deputy Speaker: Order. The hon. Gentleman's remarks are not a matter for the Chair. They are a matter for the hon. Gentleman.
  Mr. Mitchell: If my hon. Friend had listened, he would know that I said that we did not get criminals in to advise the Home Office, and that it was ill advised to get interested parties in to advise the Treasury on tax law. The analogy is there. I am aware of my hon. Friend's interest in those accountancy houses. The point is valid, because the question will always be asked whether we are soft-pedalling on the need to regulate those bodies because of the services provided to Government.
  Mr. Stephen O'Brien: I have been listening with care to what the hon. Gentleman has been saying. It seems to be a rant against a particular firm, which does not necessarily do the House any credit. Would the hon. Gentleman be prepared to repeat what he has been saying outside the House, without the cloak of parliamentary privilege?
  Mr. Mitchell: What a ridiculous question. If the hon. Gentleman had said that he had listened with interest,

  935
  I would have been overjoyed. If he is listening with a police notebook in his hand, the point is fatuous in the extreme. I have quoted the SEC's report on one particular company and the facts about the firms advising the Treasury. That is all that I have done. That is repeatable inside or outside the House. It is a matter of public record. I am sorry that we have to come down to such silly, nit-picking points in objection to the argument that large blocks of power need to be controlled and regulated, which is the responsibility of government.
  5.15 pm
  Mr. Burnett: I understand what the hon. Gentleman is saying. Does he believe that the Government should impose on the Institute of Chartered Accountants in England and Wales more stringent rules with which it can govern the affairs of its members?
  Mr. Mitchell: I do not believe in professional self-regulation. Chaps regulating chaps is almost a British myth. The Institute of Chartered Accountants in England and Wales is a puny body when compared with the enormous power of the big five accountancy houses, whose fees run into a total of £4.5 billion a year. These are enormous concentrations of power. A small professional body cannot effectively regulate them, and so-called independent regulation, which we are proposing, will not regulate them properly either.
  I shall move on to new clause 7, despite the interruptions from vested interests on the Opposition Benches. The Bill introduces some highly desirable changes, but accountancy houses enjoy a state guaranteed monopoly on insolvency and auditing. It is therefore right to regulate. I am glad that my hon. Friend the Minister gave the commitment that legislation will include a requirement for financial disclosure equivalent to that which is required of companies. The new clause deals with the disclosure of emoluments. The Minister told us—it is in the Bill—that limited liability partnerships will provide information in the notes to accounts about the aggregate amounts withdrawn or applied on behalf of members during the financial year. There is also the requirement to disclose the earnings of the highest paid member in cases where profit exceeds £200,000.
  The figure of £200,000 comes from schedule 6 to the Companies Act 1985. That Act requires that information that is published should include emoluments, gains made by directors on the sale of share options and amounts paid to directors under long-tern incentive schemes. I hope that the Minister will tell us that the same categories will be covered in the requirements on limited liability partnerships, and that his estimate of £200,000 is based on the categories to which I have referred. Will LLPs be required to publish these details?
  We all know that there is considerable disquiet about fat cats. The public need to know how much they are being paid. It is possible for limited liability partnerships to own limited companies. We would therefore have the ludicrous situation in which the limited company would have greater obligations to disclosure than the LLP parent of that company, which is exempt from much of that disclosure. That seems to be wrong.
  I know that Opposition Members are not keen on disclosure of public information, but it is the public's right to know, especially when incomes have been accrued in pursuance of a publicly granted state-conferred monopoly in audit and insolvency.
  936
  New clause 8 is about more disclosure of the assets of each partner. Concessions are conferred on accountancy and other firms that are trading as LLPs. In the event of insolvency, the creditors can call on the assets of an LLP, which as I have said will not be substantial. It is more the assets of the negligent partner that are important. I return to the point which I broached earlier, which is how the public know which partner is responsible for the negligence. Who is the negligent partner against whom actions must be pursued? Knowledge of that might dissuade some clients from having dealings with that partner.
  Customers should have access to that information. If existing claims against a partner are such that a further claim would take all his assets, the public need to know. How will they learn who is the negligent partner and whether other allegations of negligence have been made against individual partners of a limited liability partnership? People need to know who they are dealing with and what their status is.
  We are talking about public provision of information to safeguard creditors, including information about individual partners' assets, against which claims can be made. We are limiting liability, so we need to know what the assets are. In the case of a company, shareholders' liability is limited to the extent of the paid-up shares, and the balance sheet lists the assets and liabilities for anyone to see; but the balance sheets published by LLPs will not give the creditors full and fair information. All I want is parity between the information published by LLPs and by limited companies. That seems fair.
  Amendment No. 19 deals with registration and is designed to let us know what authority each member has to act.
  Amendment No. 24 is again a matter of necessary public information for creditors and potential creditors about the financial standing of the LLP.
  I hope that my hon. Friend the Minister will respond to some of my points and clarify whether my arguments are valid.
  Mr. Fabricant: The hon. Member for Great Grimsby (Mr. Mitchell) delivered quite a rant and proved his inability to count: I intervened twice, not three times. Some of his arguments, if not persuasive, raise interesting questions that the Minister should address.
  It is a good idea in principle for the liability of large partnerships to be limited. In this modern age, partnerships can comprise 50, 100 or even 200 or 300 people—and in some instances, several thousand—and it is not practical to expect them all to have joint and several liability, but I tend to agree with the hon. Gentleman that, if the state is providing some protection, it should demand a quid pro quo and expect certain information from the partnership.
  I do not go as far as the hon. Gentleman. Judging from their faces, not many Government Members would go that far. It is interesting to note the divisions on the Government side. The Government feel—and I agree with them—that there should be some protection in the form of limited liability, possibly echoing some of the protections that are available to companies under the Companies Acts. Should not limited liability partnerships also have to meet some of the obligations of disclosure in annual returns that are imposed on companies under the

  937
  Companies Acts? I would welcome an unemotional and non-ranting answer to that question—the Minister is known for his unemotional and accurate responses.
  Mr. Jim Cousins: I share much of the frustration and irritation expressed by my hon. Friend the Member for Great Grimsby (Mr. Mitchell) at the circumstances in which we find ourselves. Apparently, the Bill is technical and rather obscure—of interest only to a few people who have a particular interest in some obscure points of law and commercial practice. Yet it advances an important innovation in British commercial law, which could well be taken up by many presently unlimited liability partnerships.
  The hon. Member for Lichfield (Mr. Fabricant) said that the Bill was targeted at the needs of large partnerships. He and the Government must recognise that a number of partnerships that are not large may seek the protection and advantage of limitation of liability. That ought to give the House cause for a little caution.
  We find ourselves discussing this quite complex Bill, which advances an important new principle, between the excitement of a statement on the Post Office, which is important, and the even greater excitement of debate on the Fur Farming (Prohibition) Bill. That is not the ideal circumstance in which to be discussing such a matter. It inevitably imposes a good deal of pressure—I do not suggest in any way that it is external pressure—on those taking part in the debate.
  Mr. Fabricant: Of course the hon. Gentleman is right that small as well as large partnerships may seek the protection that the Bill will offer when enacted. However, given that there is similar legislation in other parts of the world, does he fear that jobs might be lost if larger partnerships centred outside the United Kingdom, in countries that offer partners protection?
  Mr. Cousins: Of course I shall come to that point, although I hope not to be tempted too wide of the new clauses and amendments.
  The hon. Gentleman asked my hon. Friend the Member for Great Grimsby whether, in principle, he accepted the idea of limitation of liability in partnerships. Were I to be asked that question, my answer would be yes; I have no difficulty with the limitation of liability in partnerships.
  The Partnership Act 1890 has always been considered one of the most ideal pieces of legislation. It has endured for more than a century without any tampering with or amending of its essential form or principles. It has stood the test of time; it has the clear concept of joint and several liability.
  However, the Act was framed when all partnerships were extremely small, the people were individually known to each other, and the reputation, efficiency and performance of the partners could be measured and tested by potential and actual partners. Any problems could be addressed immediately, simply and directly. We have moved on: we now have partnerships that consist not merely of thousands of partners but sometimes of tens of thousands of partners, in which such disciplines cannot apply.
  938
  5.30 pm
  It may be right to offer the protection of limited liability to such partnerships, but—this point has already been discussed—the limitation of liability being offered here is not confined to such circumstances. Small partnerships can also take advantage of it. Therefore, we are considerably modifying the structure of the principle advanced in the 1890 legislation, and we should be properly cautious about that.
  I am prepared to consider the principle of limitation of liability in partnerships, but we must consider whether this is the right moment to introduce such legislation. We still have the unfinished business of the Caparo judgment, to which my hon. Friend the Member for Great Grimsby rightly drew attention. Auditors appear to owe no significant legally meaningful duty of care to the shareholders in the enterprises that they serve.
  Accountancy was done no favours by the Caparo judgment. It opened a hole in accountability and responsibility, which we are still puzzling how properly to fill. The present proposal to create an independent regulator for accountancy, but not a statutory one, in a way seeks to undo the damage that was done in the Caparo judgment.
  One of my anxieties about the Bill is that until we can see the real strength of the framework being offered under independent regulation—the proposals that are now being worked up in front of us in the area of accountancy—it is difficult to know whether the Bill is appropriate and soundly formed. There must be a legitimate anxiety about that.
  Furthermore, there have been a number of legal actions. Out of respect to my hon. Friend the Member for Middlesbrough (Mr. Bell), I shall not start a cascade of prominent names and cause him some agitation lest important people in our commercial world be denounced. However, my hon. Friend must recognise that those people are suing each other. Such matters may all be settled out of court. One would not attempt to speculate about that, but it is entirely possible. However, if matters do come to court, the rehearsal of the evidence will provide some important information which can guide us in legislatures and help us deal with some of the issues that arise in partnerships if we begin to limit liability.
  Mr. Stephen O'Brien: I do not dispute what the hon. Gentleman says about accountants suing each other, but to put it in perspective, much of what is happening is probably driven by the insurance cover that those partnerships have, whereby they are required to pursue their interests. The insurers drive them to that. Part of the point of the Bill is that limited liability partnerships will, to some degree, obviate the need for that depth of insurance and the expense of it, which is ultimately passed on to clients and consumers.
  Mr. Cousins: That raises more issues than it tidies up. It may be true that insurance is one of the drivers behind large accountancy firms suing each other over responsibility for the disappearance of what, it must be recognised, are hugely significant sums of money. The loss of that money has damaged thousands of individuals, voluntary organisations—in the case of BCCI, a large number of voluntary organisations—and enterprises. We are not talking about something that is of no significance; it is of profound significance.

  939
  The hon. Gentleman says that partnership firms are suing each other because of the insurance driver, and that such legal actions would not otherwise take place. That worries me. What are we doing in this legislation, offering an alternative source of cover to insurance cover that can now be purchased perfectly properly, and which is the basis of those legal actions? What will this legislation cause to be hidden that would otherwise be exposed?
  Mr. Fabricant: I am following the hon. Gentleman's argument with considerable interest, but surely there is nothing in the Bill that prevents any client of an organisation that is perceived not to have acted properly from suing the limited liability partnership?
  Mr. Cousins: I have already referred to the great difficulty there. The pressure for the legislation began in the accountancy partnerships, and although I entirely accept that far more than accountancy partnerships may seek to take advantage of it, in the accountancy world we come up against the great problems that my hon. Friend the Member for Great Grimsby and I have mentioned—the Caparo judgment and its rather unfortunate inheritance.
  Against the background of the Caparo judgment, any legal action against an accountancy partnership faces the difficulty of having to overcome the consequences of that legal decision. That point does not apply to other kinds of partnership that might seek to take account of the legislation. I fully acknowledge that. However, the House knows that the driving influence in the introduction of the legislation came from those accountancy firms. That is a relevant point.
  Mr. Burnett rose—
  Mr. Cousins: I do not want to take up too much time. I know that there is a custom whereby people who want to talk at length always say that they do not want to detain the House, but on this occasion I really do not want to detain the House, so I shall be careful about taking interventions.
  The hon. Member for Lichfield (Mr. Fabricant) drew attention to the fact that there are legal jurisdictions close to Britain—the one that is always mentioned is Jersey—in which limited liability has already been carried into law. The Conservative Government's motive for wanting legislation in this form was the fear that people would relocate to such regimes to take advantage of limited liability.
  All that has been overtaken by other events, in particular concerns about offshore legal and tax regimes, which provide unfair competitive advantage. That is a difficult and complex issue, into which I do not wish to stray this afternoon, but all will recognise that the Government have offered leadership to Europe in striking a deal on the withholding tax only a fortnight ago, and setting up a regime based on the exchange of information, which is a real, genuine and significant breakthrough in tackling such offshore regimes. Therefore, it might again be wise to see how all that develops before we advance as an argument for this legislation the fact that there may be competitive, more attractive jurisdictions elsewhere in which people might seek to locate. That is an argument for a little caution and delay.
  940
  All the new clauses concern disclosure and the importance of making information available, which will allow outsiders to form proper judgments about the good conduct and good management of any regime which has the advantage of limited liability.
  New clauses 2 and 8 advance the principle of openness in the specific context of financial information. The creation of limited liability partnership regimes gives rise to a potential tax problem. The Government acknowledge that in their correct intention to remove both the possibility of improper tax avoidance and the use of a variety of legal vehicles to take advantage of tax planning possibilities and thus improperly avoid taxation. I expected an intervention at that point, but no one wishes to intervene, so I shall move on.
  We are considering an important point. It would be extremely helpful if my hon. Friend the Minister could clarify the Government's discussions about the tax regime that accompanies the Bill, and the way in which that regime will work. The House would then be well informed.
  New clause 7 attempts to deal with one of the issues that features in the Government's agenda for company law reform. Sadly, we shall not legislate on that agenda until after the next general election. Again, there is a question of timing. I know that my hon. Friend the Minister intends the full force of current company legislation to be exercised over limited liability partnerships. We cannot speculate on any future changes—the House is not the right forum or platform for indulging in such speculation—but we are all considering the matter, and it would be helpful if my hon. Friend could tell us that the Government intended to reflect future changes in company law in the liabilities for disclosure affecting limited liability partnerships.
  As my hon. Friend the Member for Great Grimsby rightly said, new clause 4 attempts to deal with what goes on in other jurisdictional regimes. My hon. Friend rightly mentioned the work of the Securities and Exchange Commission in the United States, and its attempts to provide for a proper relationship between general accountancy work and the specific work of audit. It ensures that those two functions are not confused, and that no market abuse occurs when people use their economic power in one context to achieve economic advantages by sweeping up all the audit work. The Securities and Exchange Commission properly tries to deal with fair competition and market abuse.
  There is no point in Opposition Members saying that the Securities and Exchange Commission will not affect us here; it has already affected us. We are considering global partnerships that engage in economic activities all over the world, which are caught by the actions of the Securities and Exchange Commission. It is fair to ask how we will tackle those issues. It would be unfortunate to be led down a road of competing jurisdictional regimes with barriers between them, and all sorts of intergovernmental disputes over the propriety of one action by a regulator in one country when compared with the different framework of rules in another country. We must try to avoid that.
  5.45 pm
  The Government have referred a general bundle of issues to the Office of Fair Trading. It has been asked to consider the way in which professional partnerships work,

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  and the way in which demonstrable problems will be tackled. It would not be proper for my hon. Friend the Minister to direct the OFT's work; it would be wrong, and I do not ask him to do that. However, it would be proper for him at least to direct the OFT's attention to the matter so that it could perhaps ascertain methods of avoiding the possibility of conflict between jurisdictions, and of attempting to introduce in our regimes governing market abuse and fair competition some of the benefits that the Securities and Exchange Commission brings to regimes in the United States.
  I have mentioned important underlying issues, which all give grounds for caution; they are reflected in the new clauses. I accept that Back-Bench amendments are not always framed well. However, I have outlined the purpose of new clauses 2, 8, 7 and 4. I hope that I have explained the reasons for them, and that my hon. Friend the Minister will be able to assist us in dealing with them.
  Mr. Burnett: I declare at the outset that I am a solicitor and that I no longer practise. I used to specialise in taxation and, to some extent, partnership matters.
  Any trade or profession can become a limited liability partnership provided that at least two persons—that includes companies—come together to form one. As has been said, the usual rules for joint and several liability are not applicable to limited liability partnerships. Nevertheless, it is worth putting it on record that an individual member of an LLP is liable in tort for his or her actions, if they are negligent or held to be negligent. The firm and all its assets are fully liable.
  Disclosure should be at the heart of the Bill. I refer the House to my words on 23 May 2000 on Second Reading. I said:
  Finally, a fundamental principle of the Bill should be that the price for the limitation of liability is full disclosure of the financial affairs of a business and that such information should be readily available to the public.—[Official Report, 23 May 2000; Vol. 350, c. 907.]
  I have not changed my mind. It would be in the interests of those who did not serve on the Committee, or who have not studied the matter as deeply as others, and for the convenience of the House, if the Minister set out clearly the disclosure obligations in the Bill.
  The Parliamentary Under-Secretary of State for Trade and Industry (Dr. Kim Howells): I am well aware of the concern of my hon. Friends the Members for Great Grimsby (Mr. Mitchell) and for Newcastle upon Tyne, Central (Mr. Cousins) about accountancy and its regulation in this country. They have made it clear that they believe that limited liability partnerships are a concession to the professions, especially the accountancy profession.
  By tabling the new clauses, my hon. Friends are trying to use the Bill as a means of regulating the accountancy profession. As I said on Second Reading, I admire their tenacity and their concern for the reform of accountancy regulation. However, it is not the Bill's function to regulate professional activity. When regulation is believed to be necessary, the activity, not the LLP as an entity, will be regulated.
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  Time and deliberation were mentioned on several occasions. This Government and the previous Government have consulted on the detail of the Bill for at least four years. A long and intensive debate has therefore taken place about the proposals.
  On the issue raised by my hon. Friend the Member for Newcastle upon Tyne, Central about the investigation of the professions by the Office of Fair Trading, I share the views of my hon. Friends that the issue of auditor independence—in particular, the extent to which an audit firm should be able to provide a non-audited service to audit clients—is important. That applies not only in the US, where the SEC has made proposals to deal with the issue, but in this country.
  The OFT is conducting a review of the professions that will focus on, among others, accountants and solicitors. I am sure that the review will address the balance between competition and regulation in relation to the accountancy profession. That work provides an excellent opportunity to examine the concerns that my hon. Friends have raised about the ability of auditors to provide non-audit services. The comments of my hon. Friend the Member for Newcastle upon Tyne, Central encourage me to ensure that those conducting the review are fully aware of those concerns, and I undertake to do so.
  It has always been the intention that an LLP will have applied to it, through secondary legislation, requirements similar to those that are applied to a company. The amendments, if they were accepted, would add a heavy additional burden to LLPs in comparison with those of a company. I am strongly of the opinion that that is not the right approach.
  New clause 2 would add a substantial extra burden on an LLP in comparison to a company, and it would be manifestly unfair to require such extra requirements on an LLP. There are no Companies Act requirements for a company to set out any claims made against it for work done, nor does it need to have a statement from its regulator stating that it has complied with the relevant regulatory framework. In addition, I do not see what would be gained by giving details of employee pay, which should be a matter between the employee and the LLP.
  Under section 709 of the Companies Act 1985, any person may inspect the records kept by the registrar, and that section will be applied to LLPs. New clause 4 would impose a burden on LLPs trading outside the UK that goes beyond the requirements imposed upon a company or a partnership. It is not the role of the registrar of companies to list infractions of regulatory rules, either in the UK or in other jurisdictions. It is a matter of policy for the regulatory body concerned to decide whether infractions should be reported. I shall try to return to that issue, because my hon. Friends raised some interesting points.
  New clause 7 would require an LLP to publish details similar to the details of director emoluments that are required by schedule 6 of the Companies Act 1985. That issue was addressed by the Trade and Industry Committee, which agreed that there was no reason why the Department should revisit the issue of the disclosure of the highest paid members' drawings. I do not believe that making available any further details of members' drawings would add anything. All LLPs will need to provide information on the aggregate amounts withdrawn or applied on behalf of members during the financial year

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  in the notes to the balance sheet. That is in addition to the requirement to disclose the earnings of the highest paid member in firms where profit—before member remuneration and profit shares—exceeds £200,000. The disclosure of that information will allow potential creditors to take a view on how the LLP is being managed and whether members are making excessive withdrawals.
  New clause 8 would require the annual accounts of the LLP to include a statement that would show the value of the assets of each partner and whether that partner was involved in any litigation. I share my hon. Friends' aspirations for greater transparency and this central issue is being examined by the independent company law review, which will make—I trust—some insightful and radical proposals.
  As an LLP is a separate legal entity, we envisage that third parties will contract with the LLP rather than the member. For that reason, it is important that potential clients of the LLP are aware of the assets of the LLP and it is why we have applied the financial disclosure requirements for companies to LLPs. I do not believe that the disclosure of the net assets of members will add to creditor protection. Nor do I believe that providing information on whether a member is involved in litigation is right, because providing such information could be detrimental both to the individual and the LLP. The member should be seen as an individual separate from the LLP. I strongly believe that the new clause would be unfair and would go against our stated policy of having comparable treatment for LLPs and companies.
  I see no reason why a statement of the authority to act of each member needs to be lodged with the registrar of companies and to be made available to clients, as suggested in amendment No. 19. It goes beyond what is required of directors of a company or of partners in a partnership. The Bill states in clause 6 that every member of the LLP is an agent of the LLP. A potential client will be able to find out who the members and designated members are, and details of the financial background of the LLP and any charges on the LLP will be available from Companies House. I am happy to inform my hon. Friends that we require designated members to give details of their addresses when they are appointed as designated members. That follows the requirements for the appointment of directors.
  On the question of taxation, which my hon. Friends raised, I said on Second Reading that even though we believe that it is right to tax LLPs as partnerships, we are aware that, in some cases, the primary or only attraction of LLP status might be the tax treatment. As a result, we are considering the issue carefully with the Inland Revenue. Depending on our conclusions, legislation may be brought forward in the Finance Bill in 2001. We would, however, consult widely before legislating.
  I emphasised that our intention was not to undermine the commercial certainty of the taxation treatment of LLPs for those businesses for which LLP status was intended, and I recognise that that might happen. I know that my hon. Friends are concerned about that point—both about the possible deterrent factor it might have, and about the uncertainties that would exist for those who take the plunge to become LLPs. I share the concerns that they have raised about companies that wish to become LLPs and about the need for greater clarity about the taxation
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  implications of such a transformation. Indeed, the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) raised similar points in Committee.
  I am of the view, therefore, that it is appropriate to await the outcome of the review before commencing the LLP legislation, so that anyone wishing to become an LLP may be certain of what tax treatment it can expect. I do not expect that, in practice, that will cause delay, because our expectation was that LLPs would not be available before early 2001. Clearly, were there to be legislation in next year's Finance Bill, we would need in any case to be certain of our intentions by that stage.
  My hon. Friend the Member for Great Grimsby raised concerns about the prospect of water companies using LLPs as a means of running not-for-profit mutualised companies. That is a novel idea that has suddenly emerged on the scene since several water companies decided that they cannot make profits out of supplying water. My hon. Friend expressed concern about the intention of the owners of one particular company—Yorkshire Water—to split it in two and sell its physical assets to a non-profit-making mutual company. In that context, a statutory undertaking under the Water Industry Act 1991 must be a company limited by shares and could not be a limited liability partnership. It is perhaps also worth noting that anyone wishing to become an LLP must be carrying on a lawful business with a view to making profit. An LLP is therefore not available as an option for non-profit-making organisations.
  6 pm
  The hon. Members for Lichfield (Mr. Fabricant) and for Torridge and West Devon (Mr. Burnett) raised the general question of disclosure, and my hon. Friends the Members for Newcastle upon Tyne, Central and for Great Grimsby made a number of valuable and interesting proposals in respect of disclosure requirements for limited liability partnerships. It is, however, difficult to accept those proposals simply in relation to LLPs without considering corresponding application to companies.
  It is our aim, as far as is possible, to keep the disclosure requirements for LLPs in line with those for companies and—I hope that this addresses the point raised by my hon. Friend the Member for Newcastle upon Tyne, Central—to ensure that changes in circumstances and what those changes might generate in terms of demands for disclosure are allowed for within the remit and the report of the independent company law review.
  As I said earlier, the provision of information by companies is one of the key themes of the company law review that the Government set up two years ago. The review has already published proposals which would change quite radically some of the disclosure requirements. This therefore provides the best opportunity for many years for my hon. Friends' ideas to be considered.
  It is our intention that changes which are made to companies following the company law review should then be applied to LLPs to the maximum extent possible. Given those reassurances, I very much hope that my hon. Friends will withdraw their amendments.
  Mr. Mitchell: I am grateful to my hon. Friend the Minister and I shall try to save what is left of my career by gibbering that gratitude to him for a little while. He has

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  given us some substantial assurances. First, I particularly like the assurance that the Kelda Group—formerly Yorkshire Water—will not be able to get away with what I thought was a possible subterfuge by registering as an LLP. I am grateful for that assurance, although it was not made in relation to this group of amendments.
  Secondly, I am grateful for my hon. Friend's substantial assurance that the Bill will not come into effect until the tax review is completed. That is important as it will enable people thinking of setting limited liability partnerships to know from the recommendations of that review what the tax regime will be. That is a substantial advance in our argument.
  My hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cousins) and I have been entertaining the House with our nice guy, nasty guy double act—
  Mr. Cousins: On a point of order, Mr. Deputy Speaker. I think that my hon. Friend meant to imply that I was the nice guy.
  Mr. Deputy Speaker: That is not a matter for the Chair.
  Mr. Mitchell: Of course my hon. Friend is the nice guy.
  Thirdly, my hon. Friend the Minister's assurances on disclosure and bringing partnership law and safeguards into line with those that apply to limited companies through the company law review has given us the incentive to make submissions along the lines of the arguments that we have put before the House. We shall consider doing that in respect of both sets of provisions. That is another substantial point.
  Fourthly, my hon. Friend assured us that the Office of Fair Trading review will be looking at these matters and I am sure that it will take into account fair competition considerations in respect of the sale of other services.
  We are grateful to my hon. Friend the Minister for those substantial advances and we feel that we have achieved something in very difficult circumstances. Although Opposition Members tried to heckle us—in particular, they tried to heckle me rather than my statesmanlike hon. Friend—we were only doing the job of scrutiny that the Opposition singularly failed to do. Instead, they simply pressed for further concessions for the vested interests.
  We have been doing a job of scrutiny under a handicap. As the Bill originated in the House of Lords, it will not be returning there for further amendment. I am grateful for the four substantial concessions that my hon. Friend has given us and I realise they are all that we shall get at this stage. I do not think that it should have been done in this way, but as it has we are grateful to my hon. Friend for the concessions that he has made. As I am a realist, I shall withdraw the motion and give notice that my hon. Friend and I shall not be moving any of the other amendments in our names. I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.
  Mr. Deputy Speaker: As the hon. Member for Great Grimsby has said that he does not intend to move his later amendments, we now move on to amendment No. 1, in the name of the official Opposition.

Clause 5

  RELATIONSHIP OF MEMBERS ETC.
  Mr. Nick Gibb: I beg to move amendment No. 1, in page 3, leave out lines 22 and 23 and insert—
  (b) subject to paragraph (a), by the rules and principles which would apply if the law relating to partnerships applied to them.'.
  Neither of these are relevant interests, but I remind the House that I am a chartered accountant, so I ask hon. Members to go easy on the language that they use against chartered accountants and others. Also, I do not currently practice, but I contribute six or seven articles a year to Accountancy Age.
  Having sat through the debate on the new clauses tabled by the hon. Members for Great Grimsby (Mr. Mitchell) and for Newcastle upon Tyne, Central (Mr. Cousins), I feel as though I am intruding on private grief. If the Labour party can tear itself apart on a relatively technical measure like this one, one can only wonder what machinations, discussions and divisions are taking place behind the scenes on issues of wider concern, such as Labour's failure to deliver on the national health service, education and crime.
  Mr. Cousins: I assure the hon. Gentleman that we have had a most comradely exchange with the most comradely outcome. I should like to put that on record.
  Mr. Gibb: I am grateful to the hon. Gentleman for that intervention. I am sure that it was comradely, but none the less Labour Members were split.
  This is an important Bill which has had several layers of scrutiny. As the Minister said, it began life under the Conservative Government, but when it eventually began its passage through the other place, despite scrutiny and a report by the Select Committee on Trade and Industry, it still contained a number of problems.
  The hon. Member for Great Grimsby was wrong to say that the Opposition did not give the Bill considerable scrutiny. My noble Friend Baroness Buscombe and I discussed our concerns in great detail with the Minister, Lord McIntosh, and owing to pressure in the other place by my noble Friend and a reasonable approach taken by the Minister, many of our concerns were dealt with by Government amendments. Indeed, had the Government taken such an approach on some of their more controversial legislation, they would not be in their current position in regard to credibility with the public.
  There are nevertheless some remaining concerns which we raised in Committee and which the Government have not dealt with adequately. Our first concern is that of the so-called default provisions. Clause 1(5) of the Bill states: except as far as otherwise provided by this Act or any other
  enactment, the law relating to partnership does not apply to a limited liability partnership.
  The reason for that provision is, according to the Government, that as an LLP is a legal person in its own right and is therefore a body corporate; in general,

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  partnership law should not apply; and company law should apply instead. However, the very essence of an LLP remains that of a partnership.
  It was in order to retain the partnership ethos that professional firms have sought this form of incorporation rather than becoming companies proper. An LLP will still have what is in effect a partnership agreement regulating all the internal relations of a partnership; but particularly for smaller, less well advised partnerships which seek to become LLPs, it could well be that the internal partnership agreement will not have clauses that deal with every eventuality to be faced by a partnership in business.
  In the past, this would not have mattered. The Partnership Act 1890—and the century of case law since—have filled in the gaps regarding almost every conceivable eventuality. Future case law, based on precedent and the principles established in earlier cases, would deal with future eventualities. Those matters may include the right of partners to examine the books and records, the right to take part in the management of the partnership, and questions regarding the expulsion of members.
  Those issues may be dealt with adequately in the partnership agreement, but they may not be. Short agreements for smaller partnerships drafted when it was understood that general partnership law would apply may well not include many important provisions.
  The amendment would provide that the law with regard to the internal arrangements of an LLP should default to general partnership law. Its wording has simply been lifted from an earlier draft of the Bill. The removal of the provision from the final Bill has aroused widespread concern.
  That concern was such that the Government entered into a separate consultation exercise on the specific question of the default provisions. The views of many consultees were summed up in the Government's response document. One paragraph voiced the general concern, stating that
  in the absence of an adequate agreement between the members of a Limited Liability Partnership, the relationship between members would be uncertain; there was a strong desire that partnership law should govern the rights and duties of the members of the Limited Liability Partnership … partnership law is well understood by partnerships and practitioners, with the principles established over many years.
  That was also the view of the Law Society, which stated:
  The Society was concerned with clause 1(5) which disapplies partnership law from limited liability partnerships unless otherwise provided in the Bill. The Society has always considered there to be the need for some default provisions that would operate in the absence of agreement to the contrary within an LLP and which would cover certain basic matters relating to the mutual rights and duties of the members of an LLP.
  The Law Society accepted that the Government had amended the Bill to insert one or two of the partnership law provisions in the regulations. However, it is inevitable that some areas will not be covered by the exhaustive and specific list that the Government have included in the regulations and, as always with this Government, it is small business that will suffer. Big, well advised partnerships will be fine, but yet again the Government are creating a complex regulatory regime that puts a premium on being well advised.
  The hon. Member for Great Grimsby complained about advisers' incomes, but the pressure for greater regulation is created by him and those who share his philosophy.
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  Someone has to read, understand and remember the regulations for which the hon. Gentleman continually presses. That will lead to greater demand for expert advice, and therefore higher salaries for those prepared to do that work.
  The amendment would reduce the premium for expert advice by making the regime simpler.
  Mr. Gerald Bermingham: My sole reservation about LLPs has to do with negligence on the part of professional firms. For example, the negligence policy of a firm of accountants that becomes an LLP may not deal with any negligence created. That has been the case in certain recent takeovers. In the old days, one could at least sue the partners to make up the shortfall on the negligence cover, but that does not seem to be the case now.
  Mr. Gibb: The hon. Gentleman raises a point that goes to the heart of the Bill. The aggrieved person can still sue the partner or partners involved in preparing the negligent work. However, why should the law for people in the accountancy or legal professions be different from that covering people in the medical profession, such as nurses? They work for the health service but are not subject to losing all the assets that they have built up over a lifetime.
  It is not a matter of fat cats. There are 120,000 chartered accountants in this country. Most of them could never be described as fat cats, and they live under the constant threat that they will lose their lifetime assets because of the negligence of another partner. The Bill goes a long way towards solving that problem, and it is welcome for that reason.
  Mr. Bermingham: There is a world of difference between a partnership in a garage business and one involving accountants, estate agents, solicitors or surveyors. The difference is simple: the first provides a service, whereas the professionals provide advice. If the advice is wrong, the damages can be massive. If the service is wrong, the damages are much smaller.
  6.15 pm
  Mr. Deputy Speaker: Order. I think that hon. Members are straying into Second Reading points. The hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) should address his remarks to the amendment.
  Mr. Gibb: I am grateful to you, Mr. Deputy Speaker, but I do not believe that the distinction offered by the hon. Member for St. Helens, South (Mr. Bermingham) is valid. Advice and services are very similar, in the sense that one either provides a service or advises someone else about it. That similarity crosses all professional boundaries and is not confined to law and accountancy.
  The amendment would reduce the Bill's complexity. Even at this late stage, I hope that the Minister will relent and accept, if not its wording, then at least its principles.
  Mr. Burnett: I shall not go over material discussed on Second Reading and in Committee, but I was a senior partner in a large firm for more than 20 years and I know how important it is—for the clients and customers of a partnership, as well as for the members of that partnership—to ensure that the partnership ethos is

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  preserved. It is important that a duty of good faith should exist between the partners, as that is in the interests of clients and customers.
  I strongly support the amendment. The Partnership Act 1890 is a good Act, as was said earlier. It provides certainty and simplicity, and will provide some continuity. Simplicity is extremely important, especially for small businesses that cannot afford the advice. They will not necessarily know of the existence of regulations passed by the House.
  I hope, even at this late stage, that the Government will remember the interests of small firms and think again on this matter. The fall-back position should be provided by the 1890 Act: it has stood the test of time and is supported by a large body of case law.
  Mr. John M. Taylor: Is not one of the limitations of the 1890 Act the fact that it presupposes that ownership, profit sharing and decision making are all in step with each other? In a modern partnership, is it not possible that distinctions may need to be made between who owns, who makes decisions, and who makes profits?
  Mr. Burnett: As usual, the hon. Member for Solihull (Mr. Taylor) is correct and makes a good point. However, he knows that it is open to the parties who create a partnership under the 1890 Act to vary the profit-sharing and ownership proportions. They can do so with remarkable simplicity. Although they will have to consider the tax implications of such an action, it is the Act's simplicity that is so important.
  It is vital that small businesses do not have to fall back on the more tortuous and complicated Companies Act 1985. I understand that there must be intricate provisions under that Act relating to disclosure, and that the Insolvency Act 1986 also has a part to play. Even so, for the reasons that I have given, the 1890 Act is an excellent piece of legislation and should not be rashly discarded in the way that the Government propose.
  Dr. Howells: I acknowledge the very proper concern expressed in the amendments in the name of the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb), and the support given by the hon. Member for Torridge and West Devon (Mr. Burnett). I will try to give the amendments the respect that they deserve, because there is no question but that this is an important point. However, I will explain why I will be resisting the amendments—much to the disappointment, I know, of the hon. Member for Bognor Regis and Littlehampton.
  Throughout the Bill's passage, there has been a great deal of debate about partnership law and its application, or non-application, to limited liability partnerships. A general application of partnership law to LLPs, very similar to what is proposed in amendment No. 1, was contained in the draft Bill published in September 1998. Subsequently, we took the decision to remove it. Nothing has yet led us to conclude that we were wrong to do so, and we remain opposed to any attempt to reintroduce it. Let me explain why.
  As the hon. Gentleman informed us, the main point is that an LLP is a body corporate, while a partnership is not. That is a fundamental difference. So because a
  950
  limited liability partnership will be a legal entity separate from its members, its clients will be able to enter into contracts with the LLP itself, not the members. An LLP will also be able to hold property. In addition, because of its separate legal status, an LLP will continue until it is formally wound up, no matter what changes occur in its membership.
  A partnership, however, exists only because the partners are carrying on business together, and it has no separate life of its own. Contracts are between third parties and the partners themselves, and changes in partners will cause the partnership to dissolve, although the partners can make specific arrangements to prevent that from happening.
  Many of the provisions of the Partnership Act 1890 would be inappropriate for an LLP. Sections 1 to 4 deal with the nature of the partnership. They are of no relevance to limited liability partnerships, because the nature of an LLP is set out in the Bill. Sections 5 to 18 deal with the relations of partners to persons dealing with them. Again, they are of no relevance to limited liability partnerships because clause 6 deals with this for LLPs. Sections 19 to 31 deal with the relations of partners to one another. Only eight of those sections are appropriate to LLPs. The others deal with partnership property, for example, which is inappropriate for an LLP because property can, and is likely to, be held by the LLP, not the members. They deal also with retirement, which is dealt with in clause 4.
  Sections 32 to 44 of the 1890 Act deal with the dissolution of a partnership and its consequences. These sections would be inappropriate for an LLP, because it will be a separate body corporate, and winding up will be dealt with by application of insolvency legislation, as the hon. Gentleman hinted. Finally, sections 45 to 50 are supplemental.
  So of the 50 sections of the 1890 Act, only eight are relevant or appropriate to LLPs. We intend to apply appropriately modified versions of these eight sections to LLPs by way of regulation to govern the relationship between members where there is no agreement. Yet the amendment suggests that all 50 sections are relevant, when clearly they are not.
  The amendment would also apply the general law relating to partnerships. Again, that has been developed with regard to partnerships, not bodies corporate. In particular, over the years the general law has developed the duties owed between partners. We believe that application of these duties to an LLP would be problematic. The existence of the limited liability partnership as a separate legal entity means that members will owe duties to the LLP itself. That is not the case in a partnership. Thus a general application of partnership law could leave members of an LLP facing concurrent duties—duties owed to the LLP, and duties owed to each other. There would be no indication of which duty took priority were there to be a conflict.
  The hon. Gentleman helpfully set out in Committee the extent to which the Government have fuelled the debate.

  951
  Initially, in response to consultee concerns, we established a small working group of officials and representatives from the profession to consider the options. Discussion ranged over all the points that I have raised, and the conclusion was that the preferred solution was to apply default provisions dealing with the eight relevant sections of the 1890 Act that I have mentioned instead of a blanket application of partnership law.
  We went out to consultation on this in February. I am sure that the hon. Gentleman remembers that full well—we said it often enough. The response was in favour of the approach that the Government have adopted. The consultation paper also dealt with the question of whether we should impose a duty of good faith as between members. As I explained in some detail in Committee, we eventually decided against such a duty, although nothing in the legislation would prevent members of a limited liability partnership including such a duty in their membership agreement if they so wished.
  Finally, perhaps I might comment on the two main arguments made by those in favour of a general application of partnership law. First, they argue that partnership law is well understood and that the Partnership Act 1890 is a model of simple and elegant legislation. However, as I have said, partnership law is not just the 1890 Act, but an extensive body of general law. This is not simple, even for experts. There are a number of complicated and sometimes vexed issues, which is why the Law Commission is currently reviewing partnership law.
  Next, it is argued that it is difficult to see how the expressed intention to create an entity that combines partnership ethos with limited liability can be achieved without applying partnership law. However, the LLP legislation remains silent on the relationship between members, so as to ensure that there is freedom for members in each LLP to develop provisions appropriate to their specific circumstances. It is that flexibility which those partnerships that are planning to convert to a limited liability partnership are keen to see preserved in the new entity, and we believe that that is what will preserve the partnership ethos.
  I remain unconvinced that amendment No. 1 is necessary or suitable. I very much hope that the hon. Gentleman will see fit to withdraw it.
  Mr. Gibb: That was a useful exchange of arguments that we first rehearsed in Committee. I cannot claim to have heard the four concessions from the Minister which the hon. Member for Great Grimsby (Mr. Mitchell) imaginatively construed from the Minister's first response. I had hoped that the Minister might, at the last moment, give small businesses some concessions, so he will not be surprised to hear that I am disappointed, although not surprised, at his response. On that note, I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Mr. Deputy Speaker: As the hon. Member for Great Grimsby (Mr. Mitchell) does not intend to move several of his amendments, we now proceed to amendment No. 7.

Clause 15

  APPLICATION OE COMPANY LAW ETC
  Mr. John Burnett: I beg to move amendment No. 7, in page 10, line 15, after "to", insert—
  'bodies corporate recognised by the Law Society under section 9 of the Administration of Justice Act 1985,'.
  Mr. Deputy Speaker: With this it will be convenient to discuss the following amendments: No. 8, in page 10, line 17, after "to", insert—
  'bodies corporate recognised by the Law Society under section 9 of the Administration of Justice Act 1985,'.
  No. 4, in page 10, line 22, at end insert—
  '(2) For the purposes of this section any law relating to bodies corporate recognised by the Law Society under section 9 of the Administration of Justice Act 1985 shall be deemed to be a law relating to companies or other corporations'.
  Mr. Burnett: We discussed in Committee a new clause that contained proposals fairly similar to those in amendments Nos. 7, 8 and 4. Unfortunately, due to a technical hitch, I am now told that solicitors might not be able to set up as LLPs—at least, not as soon as other professions. The Minister was helpful in Committee, and was anxious that solicitors were not discriminated against.
  There is a large body of legislation that makes reference to solicitors which will need amending in the light of this Bill. The Law Society was led to believe that this could be achieved by making regulations under clause 15, and that is what I have sought to do. However, I understand that the Law Society has been told that the Minister's Department believes that it may lack the power to make these regulations.
  This has led to some confusion, and the Government clearly still intend solicitors to take advantage of this new business entity. Indeed, the Minister assured me in Committee that solicitors would not be penalised or discriminated against in any way. I hope that the Minister can put my concerns at rest.
  6.30 pm
  However, there is still concern in the Law Society about how the Government will ensure that solicitors are not discriminated against. The Minister suggested in Committee that it might require primary legislation, but what chance is there of a dedicated solicitors Bill before this Bill comes into force in 2001? I understand that another option might be to use orders under the regulatory reform Bill, but that Bill is still in draft. When can we be certain that it will receive Royal Assent in any event? It may be that the necessary changes can be made by using existing powers within the body of legislation affecting solicitors and their practices, such as the Solicitors Act 1974 and the Administration of Justice Act 1985. However, the Law Society is doubtful whether that can be achieved, and I believe that the Department of Trade and Industry also has concerns.
  It is surely the neatest solution to use clause 15 to make the necessary changes, in accordance with the three amendments that we are discussing. Even though the DTI recently voiced doubts, the Law Society still believes that the powers in the Bill are adequate, although I understand

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  that we are waiting for parliamentary counsel to confirm that. I hope that the Minister will let us have his views on that point. The amendment would simply make the power more explicit.
  I know that the Minister is extremely concerned about this problem. He assured me in Committee that no discrimination or prejudice would be suffered by the solicitors' profession as a result of the introduction of this legislation. In other words, all trades and professions should be treated equally and must equally be able to become LLPs in 2001. Many thousands of individuals who make a great contribution to the United Kingdom economy wait to hear from the Minister his response to the group of amendments.
  Dr. Howells: I rise with appropriate gravity, knowing that thousands of solicitors out there are hanging on my every word. I restate my determination that solicitors will not be discriminated against when it comes to their ability to form LLPs. I am sure that the hon. Gentleman will be pleased to hear of the progress that we have made on this issue since we discussed it in Committee. I said then that my Department was working with the Law Society and the Lord Chancellor's Department to examine the detail of the legislation governing solicitors and consider whether primary legislation was unavoidable and, if so, to determine what specific changes needed to be made.
  On the basis of the analysis carried out by the Law Society and the Lord Chancellor's Department to date, we believe that the vires contained in the Bill are wide enough to make the amendments that have been so far identified by regulation to ensure that solicitors may make use of LLPs. Assuming that no further amendments are considered necessary that differ in kind to those already identified, the amendments will be included in the regulations to be made under the Limited Liability Partnerships Bill when it receives Royal Assent. I see no advantage in the amendments tabled by the hon. Member for Torridge and West Devon (Mr. Burnett), and I invite him not to press them.
  Mr. Burnett: I am much comforted by the Minister's words. I am grateful to him for the attention that he has given to this important matter. I note his comment that his Department, the Lord Chancellor's Department and the Law Society believe that the vires are wide enough in the Bill as drafted, and in the regulation provisions in clause 15. On that basis, I am happy to beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Mr. Gibb: I beg to move amendment No. 2, in page 10, line 22, at end insert
  '(2) Section 458 of the Companies Act 1985 (punishment for fraudulent trading) shall apply to limited liability partnerships.'.
  Mr. Deputy Speaker (Mr. Michael J. Martin): With this it will be convenient to discuss the following amendments: No. 3, in page 10, line 22, at end insert—
  '(2) No regulations made under subsection (1) above shall enable indictable criminal offences punishable by imprisonment to be made applicable to limited liability partnerships, other than those which are contained in the Companies Act 1985 and Insolvency Act 1986 as at 1st June 2000.'.
  954
  No. 11, in clause 17, page 10, leave out lines 31 and 32.
  No. 6, in schedule, page 15, line 15, leave out—
  incorporated as a limited liability partnership with that name,'
  and insert—
  'a limited liability partnership partnership,'.
  Mr. Gibb: During a debate earlier this afternoon, we heard from the hon. Members for Great Grimsby (Mr. Mitchell) and for Newcastle upon Tyne, Central (Mr. Cousins) about the vast salaries that some lawyers and accountants are able to command, but I should tell them that they are responsible for those high salaries. The growing body of rules and regulations emanating from this place that have to be obeyed by people in the real world is the cause of those high salaries. The left-wing interventionist philosophy of the hon. Gentlemen and their party creates the pressure for the vast majority of regulations.
  When I started work as a tax adviser in 1986 at KPMG, or Peat Marwick Mitchell and Co., as it was then, the tax legislation was contained in one volume of "Butterworths", and it was not a particularly thick volume. Now there are three volumes, each bigger than the 1986 one and printed on thinner paper. The tax practice grew hugely during that period as the volume of tax legislation increased, and the same has happened to company law and no doubt a whole host of other areas of law. I know that most of the increase took place under the Conservative Government, but the pressure for regulation tended to come from the left-wing philosophy in our political regime, although much of the tax legislation was introduced in order to close loopholes.
  The consequence is that the demand for people who have read, learned, remembered and understood our legislation is increasing. Although the supply of people prepared to do that kind of work has increased to a degree, the work is painstaking and not terribly exciting. So demand has outstripped supply and the people with experience and ability are now commanding high salaries. The responsibility lies not with the City firms—with KPMG or PricewaterhouseCoopers, which the hon. Member for Great Grimsby kept going on about—but with us in this place.
  We pushed through vast volumes of new rules and tried to make it even easier for ourselves by pushing large chunks into secondary legislation, which often are not debated. When they are debated, it is done upstairs in Committee without the possibility of tabling amendments. We are becoming a conveyor belt, mass-producing legislation that we expect people to obey. We deem them to have knowledge of all the laws that we pass. Then some Members of Parliament have the audacity to complain that society is devoting too many resources to reading and applying that legislation.
  The Bill is a classic example of how a simple 19-clause Bill can spawn a volume of regulations. Four clauses of the Bill simply empower the Government to create new swathes of regulations contained in a volume the size of the copy that I have here. Clause 16 is a classic Henry VIII clause, and it even provides power to make regulations that themselves can amend primary legislation. There will be no First or Second reading, no tedious Committee stage, Report or Third Reading. The primary legislation will simply be amended by a statutory instrument rubber-stamped by a Committee upstairs.

  955
  Throughout the Committee proceedings, when the Opposition have raised concerns—the hon. Member for Torridge and West Devon (Mr. Burnett) shares our concern—about the quantity of secondary legislation, the answer from the Minister was that it was better to use secondary legislation because it was easier to amend. That is the point. We must make it harder, not easier to amend and create new regulations. Some £10 billion of additional regulatory burdens have been piled on to industry in just the past three years. Small business in particular is drowning under the deluge of paperwork. We are becoming a nation of inspectors and regulators instead of shopkeepers and entrepreneurs.
  The House of Lords Select Committee on Delegated Powers and Deregulation carried out its duties well when it examined the Bill. It alerted Parliament to the fact that clause 16 is a Henry VIII provision, and we ought to take notice of that, not simply ignore it, as the Government did in Committee. The Select Committee was set up to highlight Henry VIII provisions.
  The report also highlighted the Committee's concerns about the use of secondary legislation to create new serious criminal offences. In paragraph 8, the Committee says:
  The draft regulations create offences punishable on summary conviction by a fine but the power is wide enough to allow the regulations to provide for imprisonment or for trial on indictment. If, as seems likely, the intention is to provide only for summary trial and a fine, the Committee is of the opinion that it would be better for this limitation to appear in the Bill.
  In other words, the Committee assumed that the power was intended to create only minor offences. Its members felt that that was acceptable, but they were alarmed that the way in which the clause was drafted could enable the creation of more serious offences. They thus recommended that the Government should change the clause so as to reduce the power and to confine it only to minor criminal offences.
  The Government refused to do so, however. They insisted on the need to incorporate all the existing criminal penalties under the Companies Acts and under insolvency legislation in the LLP regime. That may be fair enough, but it should be done through primary legislation, not by statutory instrument. The amendments would do precisely that; they would incorporate in primary legislation the serious criminal provisions that the Government want to include.
  In Committee, something more sinister was revealed: clause 17 is not merely about incorporating in the LLP legislation the criminal provisions under existing company and insolvency law; it is also about enabling new criminal offences to be created by secondary legislation. The Minister said that
  it is important to preserve the flexibility to create offences in future and to decide how they should be punished … There may be new crimes for which we shall have to formulate new punishments.—[Official Report, Standing Committee F, 15 June 2000; c. 63.]
  There we have it: new crimes and punishments created by secondary legislation. That is wrong. The Minister knows that it is wrong. The House of Lords Committee on Delegated Powers and Deregulation knows that it is wrong. That Committee was set up in 1992 with a specific
  956
  responsibility: to point out to Parliament when such matters are wrong. The Minister should take note of the Committee's views and accept our amendments.
  Mr. Stuart Bell: I declare an interest as a barrister at law, as an adviser to Ernst and Young and as a contributor to Accountancy Age.
  Amendment No. 6 is technical; it may seem minor, but it is important for those firms affected by the provisions and by those with whom they do business. It will mean that the British branch of an oversea limited liability partnership will be able to continue to use a name that concludes with the words "limited liability partnership", "LLP" or their Welsh language equivalents. As drafted, the Bill would make it an offence for people to describe themselves as a limited liability partnership or LLP unless they were incorporated in this country.
  The pace of change in the global village is such that, sometimes, the drafting of legislation has difficulty keeping up. That is the case for the Bill. Its present wording would cause problems for all those LLPs that are registered in another jurisdiction, but have a place of business in the UK. It is to the credit of the Government, of Ministers and of the Department of Trade and Industry that they realised that such problems would be caused. I hope that they will look benevolently on my amendment.
  It is thought that, for example, there are at least 30 United States law firms with LLP status that have an office in London. Their LLP status shows why the Bill is welcome; it allows British firms to compete on the same basis. The presence of such firms in London demonstrates the dynamism of the international market for legal services.
  It must be right, however, that all those doing business with firms whose partners have limited liability should be aware of that fact. The thrust of the policy behind the Bill is that a firm's status should be disclosed, together with the fact that its liability is limited. Under clause 14, the Secretary of State will have power to regulate overseas LLPs. Furthermore, the DTI has suggested that, in due course, it will hold consultations on appropriate provisions.
  It would be quite inconsistent with such powers and with such an intention to forbid the use of the LLP title from the outset. Fortunately, the solution is simple; it is to be found in the amendment. The amendment ensures that an oversea LLP will not be prohibited from describing itself as such. A definition of "oversea limited liability partnership" is to be found in clause 14(3): it is
  a body incorporate or otherwise established outside Great Britain and having such connection with Great Britain, and such other features, as regulations may prescribe.
  The practical effect of that is that regulations will determine precisely which LLPs will be entitled to the benefit of the amendment. I know that those firms with limited liability that have a place of business in the United Kingdom are also subject to regulations under clause 14.
  6.45 pm
  The amendment reflects the on-the-ground reality of international law practice and recognises the realities of the globalised economy. I am grateful to the Minister and to his Department for acknowledging that. The amendment also serves the public interest by communicating to the public

  957
  the status of business organisations. In those circumstances, I hope that the Minister and the whole House will welcome the amendment and further its passage onto the statute book.
  Mr. Burnett: I speak to amendments Nos. 2, 3 and 11, tabled by the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) and his hon. Friends. As the hon. Gentleman was kind enough to point out during his speech, Liberal Democrat Members deprecate the use of regulation to introduce so many of the provisions under the Bill; such power is utterly unsatisfactory. Most pernicious of all are new regulations that could deny individuals their liberty. They should not be incorporated in law except through primary legislation. That must be clear to all Members of the House.
  Dr. Howells: I shall deal with amendments Nos. 2, 3 and 11, before dealing separately with amendment No. 6, proposed by my hon. Friend the Member for Middlesbrough (Mr. Bell).
  In Committee, the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) expressed concern: first, that we were intending to apply to members of an LLP existing criminal offences that apply to company directors and are punishable by imprisonment; and, secondly, that those offences were to be imposed by secondary legislation. He expressed further concern that the power in clause 17 was wide enough to allow the creation in regulations of new offences that may also be punishable by imprisonment.
  If I understand the hon. Gentleman correctly, amendment No. 2 is intended to probe why we have not included in the Bill all the offences punishable by imprisonment. Any alternative interpretation does not seem feasible. It is our intention to include section 458 of the Companies Act 1985 in regulations alongside other offences, and I cannot imagine that there is anything so special about that section that it should appear in the Bill when other sections—such as section 450, which makes it an imprisonable offence to destroy, mutilate, falsify, or alter documents—remain in regulations. Nor can I imagine that the intention is to place section 458 in the Bill as the only provision punishable by imprisonment. How would we justify providing that, in some circumstances, members of an LLP would face a lesser penalty than directors of a company for the same offence?
  Why, then, have we not put imprisonable offences in the Bill? Because we do not consider it appropriate. As I have made clear, our intention is that the members of an LLP should face the same penalties as members of a company; that seems a reasonable policy objective. The offences arise from various provisions throughout the companies and insolvency legislation. We see no reason to place those provisions in the Bill while others are confined to regulations. In considering the legislation, Parliament concluded that the level of penalty was appropriate to a body corporate with limited liability and to its directors. We see nothing about the limited liability partnership to suggest that application of those penalties to members of an LLP is inconsistent with Parliament's intentions.
  I shall now discuss amendment No. 3. I realise that the intention is to restrict our powers to imprison members of a LLP to those offences that are contained at present in
  958
  the Companies Act 1985 and the Insolvency Act 1986. The hon. Member for Bognor Regis and Littlehampton would prefer it if, every time that the Government wanted to legislate to make an offence punishable by imprisonment, they could do so only by introducing primary legislation. That is a reasonable case to make.
  I shall now discuss amendment No. 11. It is clause 17 which provides that regulations may, in particular, make provisions for dealing with non-compliance with any of the regulations, including the creation of criminal offences. However, amendment No. 11 would remove that provision in its entirety.
  The House of Lords Select Committee on Delegated Powers, which the hon. Gentleman mentioned, drew the attention of the other place to the powers to create offences by regulations, and invited it to consider whether the Bill should be amended to provide that such offence should be punishable, on summary conviction, by a fine.
  We explained in our response that it was our intention to apply to limited liability partnerships the same offences applying to companies. We noted that the creation of new offences would be subject to affirmative resolution, and our intention to apply existing offences for companies in the first set of regulations would mean that these would also be subject to affirmative resolution.
  While we have no intentions at this stage to apply to LLPs anything other than the offences applying to companies, the power is wide enough to create new offences, as I think that our response indicated quite clearly. We believe this to be a prudent provision for the future, and consistent with similar provisions in existing legislation.
  I cannot agree that amendments Nos. 2, 3 or 11 are either appropriate or necessary. In addition, if we look at their practical effect, we can see that they would be highly problematic. Amendment No. 3 is to clause 15, and to regulations made under subsection (1) of that clause, yet it is the power in clause 14 which provides for the Government to make regulations on the insolvency and winding up of limited liability partnerships or oversea LLPs. Were we to accept these amendments, we would be prevented from making any provision for non-compliance with regulations on the insolvency and winding up of LLPs. That cannot be right.
  I shall now discuss amendment No. 6. I am very grateful to my hon. Friend the Member for Middlesbrough for raising this point. Our attention has been drawn very recently to the inconsistency between the drafting of this paragraph, and our statement to the Select Committee on Trade and Industry in June 1999. We told that Committee that company legislation which requires that oversea companies prominently display the company's name and the country in which it is incorporated will also be applied to oversea-registered LLPs by regulation, and that this includes the requirement to display that information on letterheads and on all notices and other publications of the LLP. That remains our intention.
  The question then arises as to why we need additionally to prevent the use of the phrase "limited liability partnership" at the end of the title of an oversea-registered LLP. That would cause particular difficulties for existing oversea LLPs, many of whom will be required by the legislation of the jurisdiction in which they are registered, to include those words.

  959
  We have concluded that it is unnecessary both to restrict the use of the words "limited liability partnership" in the title of oversea LLPs and to require that they display their place of registration on all their publications. The latter should prove wholly sufficient to notify clients that they are dealing with an oversea entity.
  Therefore, while I ask the hon. Member for Bognor Regis and Littlehampton to withdraw amendment No. 2 and not to press amendments Nos. 3 and 11, I will agree to amendment No. 6, tabled by my hon. Friend the Member for Middlesbrough—a rare event indeed in the progress of the Bill.
  Mr. Gibb: I will accede to the Minister's request that I ask the leave of the House to withdraw amendment No. 2 and refrain from pressing amendments Nos. 3 and 11, but he was slightly disingenuous when he knew very well the purpose of the amendments. It was not intended to restrict the use of prison in dealing with people who commit serious company law or insolvency law offences. The purpose of the amendments is to point out the very real concerns, raised by the House of Lords Select Committee on Delegated Powers, that it is not proper—it is not right—for new serious criminal offences punishable by prison to be introduced into our legal system by means of secondary legislation.
  The salient question is not whether the affirmative or negative resolution procedure is used, but whether the new crimes are created by secondary legislation, which cannot be right. Such a measure should go through the full procedures of the House—First Reading, Second Reading, Committee stage, Report stage and Third Reading—and then pass on into the Lords, so that there is a full chance of the whole nation being aware of the creation of those new criminal offences.
  The provisions are very wrong. It is a sad day when our House is rubber-stamping and mass-producing this kind of criminal legislation through secondary legislation. I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.

Schedule

  NAMES AND REGISTERED OFFICES
  Amendment made: No. 6, in page 15, line 15, leave out—
  'incorporated as a limited liability partnership with that name,'
  and insert—
  'a limited liability partnership or oversea limited liability partnership,'.—[Mr. Stuart Bell.]
  Order for Third Reading read.
  6.55 pm
  Dr. Howells: I beg to move, That the Bill be now read the Third time.
  The Bill will introduce, for the first time in nearly a century, a new vehicle for carrying on a business. It is the result of three years of consultation and debate with a wide variety of interested and learned individuals. Detailed legislative proposals have been in the public domain since September 1998, and these were scrutinised shortly afterwards by our own Select Committee on Trade and Industry. Since then, the Bill has received close and thorough scrutiny in the other place and by Members of this House.
  960
  The Bill before you today, Mr. Deputy Speaker, is in very good shape, and I take the opportunity to thank all those, on both sides of the House, who participated in the many lively and interesting debates that we have had on the detail to ensure that this is the case.
  6.56 pm
  Mr. Gibb: We have now reached the final stage of the Bill's long journey to the statute book. It is one of the few Bills that the Government have managed to get through both Houses without its becoming logjammed in the congestion that they have created in the other place, so this is quite a novel occasion.
  The Bill started life under the Conservative Government, in response to some genuine concerns on the part of the accountancy and legal professions, which were finding it increasingly difficult to retain some of their best people because those people were refusing to accept the risks of becoming a partner.
  Listening to some of the members of the Labour party and their deep-rooted prejudices and hostility to accountants has been quite a revelation. There are 114,000 chartered accountants in this country, who work hard for a living, like anyone else. Some are paid well; others are not. But why should that particular line of work expose participants to the risk of losing a lifetime's savings as a result of the negligence of a fellow partner? That approach does not apply to doctors or nurses in the national health service—no one could say that the work of a chartered accountant is more important than that of a doctor or a nurse—or to teachers, or even to bankers in the City of London, so why should it apply to accountants and solicitors?
  The Bill simply addresses that historical anomaly and, if anything, it is likely to ease the upward pressure on salaries as firms of solicitors and accountants find it easier to recruit and to retain key staff.
  Mr. Fabricant: Is it not also the case that people using those services will also find that their fees are reduced, as was pointed out earlier in our debates this evening, because there will be less need for firms to take out indemnity insurance, which can be so costly nowadays?
  Mr. Gibb: My hon. Friend makes a very valid point, and I hope that the hon. Members for Great Grimsby (Mr. Mitchell) and for Newcastle upon Tyne, Central (Mr. Cousins), who tabled several amendments, will take it on board.
  The Bill was one of the first to undergo the new procedure of being examined by a Select Committee before beginning its passage through Parliament. The Select Committee report was of a very high quality and certainly resulted in the removal from the Bill of a raft of the more unacceptable and unworkable provisions. However, it is disappointing that the Committee has not been given the opportunity to examine in more detail the whole volume of draft regulations which were re-published in almost final form in May 2000. Given that the meat of the Bill is contained in those regulations, I believe that the experiment of having a Bill scrutinised by a Select Committee has not been completed, given that it has not yet looked at those regulations. The Committee requested to look at those regulations. I hope that before

  961
  those regulations are laid before Parliament, a report will be prepared on the volume of draft regulations that the Government have published.
  The new draft Bill that followed the Select Committee report went through a further consultation process. However, the final Bill, which started life in another place, gave rise to a number of concerns. My noble Friend Baroness Buscombe highlighted on Second Reading our concern over the disapplication of partnership law and the absence of a default to that law on issues on which the partnership agreement is silent. The Government have dealt with that matter in part, although not satisfactorily.
  The Government took on board and dealt satisfactorily with our concern about the absence of provisions to deal with a member wishing to retire from a limited liability partnership. We were also concerned about an ambiguity in the Bill: whether members of an LLP could be construed as employees. That would have significant tax and employment law consequences for that member. Again, Lord McIntosh took on board Opposition concerns and amended the Bill to make it clear that members of an LLP were not to be employees.
  We were concerned about the taxation provisions in the Bill and whether converting from a partnership to an LLP would trigger a capital gains and a stamp duty charge. We secured assurances and amendments on that matter in another place. Other issues, such as insolvency and acquisition accounting were also raised and dealt with. Indeed, if Ministers were as responsive to Opposition concerns in this House as they seem to have been, on occasion, in another place, they might not now be developing a reputation for being out of touch and arrogant.
  Having said that, the Opposition are pleased that we have ensured that this legislation, which is important for commerce, will go on to the statute book in a better form than it would otherwise have done. We remain concerned about the absence of a general default clause and alarmed at the extensive regulatory powers contained in the Bill, in particular clause 16—the Henry VIII clause—and the power to create new serious crimes and punishments by secondary legislation, which is contained in clause 17.
  Those important reservations aside, the Bill is welcome. As my hon. Friend the Member for Lichfield (Mr. Fabricant) just intimated, it will do much to ease concerns among professional firms and we can only hope that that may lead to industry facing smaller increases, or even reductions, in professional fees.
  7.2 pm
  Mr. Burnett: We support the Bill, although some other improvements should have been made. I am encouraged by what the Minister said about its applicability to solicitors.
  We discussed clause 7 at length in Committee—the provisions that relate to ex-members. The Minister criticised that clause in Committee, at least by implication, because he considered it inflexible. On report, I tabled amendment No. 5, but it was not selected. I hope that the Minister will think again about that matter. The amendment would have made it clear that clause 7(2) was intended to have a similar effect to section 31 of the Partnership Act 1890, which the Minister conceded was
  962
  important and prayed in aid for flexibility. Such an amendment would preserve flexibility with regard to the arrangements for the internal management of a limited liability partnership, which is important.
  There are to be further consultations and regulations in respect of taxation. I draw the Minister's attention to the roll-over relief provisions that impact unsatisfactorily on LLPs. Roll-over relief has been an aspect of capital gains tax since the inception of that tax in 1965, I believe. At present, gains on the sale of an asset used in a trade can be rolled over into partnership property—that is, an existing 1890 Act partnership. There are special rules if the property is a wasting asset. Where that roll-over has taken place, the gain is not recaptured if that 1890 partnership comes to an end, provided that the assets are not disposed of. One pays the tax, including the tax on the rolled-over gain, when the asset is sold. If one partner leaves and sells his interest, the gain crystallises at that point and only in relation to that proportion of the asset that is sold. If an 1890 partnership ceases trading and the asset is owned in the same proportions as it was owned in the partnership when it was functioning, the rolled-over gain does not crystallise—it does not do so until the asset is sold.
  I hope that the Minister will confirm that that capital gains tax treatment should apply to LLPs as it does to existing partnerships. It is important because there will be no cash to pay the tax until the asset is sold and that will affect small businesses in particular. We talked about that in our debates on report. Small businesses do not have the benefit of high-powered and expensive lawyers and accountants to advise them—we must remember that any trade or profession can become an LLP. First, the small business will not have the cash to pay the capital gains tax. Secondly, small businesses require simplicity. If they cease trading as an LLP, they do not know that rolled-over gains will necessarily have to be payable in those circumstances.
  Roll-over relief is important for small businesses—it is important for all businesses—and that is reflected in the fact that the relief for assets used in a trade which has not altered since the inception of capital gains tax in 1965. It is important because it encourages investment, which will encourage jobs. I hope that the Minister will think again about those two matters: clause 7 and the roll-over relief.
  Finally, we support the Bill and we wish it a swift Royal Assent so that it can become the law of the land in short order. No body of individuals, no profession and no individual trade should be excluded or prejudiced because they cannot become an LLP at the same time as all the other organisations, trades or professions.
  7.7 pm
  Mr. Mitchell: I had not intended to take part in this debate, but the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) provoked me to do so by arguing that Labour Members were attacking accountants. We were not attacking accountants; we were primarily attacking the power of the big five accountancy houses, which inflict damage on the rest of the profession by their failures, by the sort of cases that come up against them and by stealing business from smaller accountants. We should protect the smaller accountants. We should use the power of Government and Parliament as a countervailing power against the over-weaning dominance of the big accountancy houses, which are now such a power in the land.

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  In the United States, the Securities and Exchange Commission is attacking such power assiduously. The difference between the two countries is that the Bill is another milestone on the rise to power of such companies. In that situation, it is right to insist on concessions in return for the privilege of limited liability partnership that is being given—concessions on consumer protection, protection for stakeholders and more effective regulation. In this country, those concessions come later, and I hope that they will do so.
  The Bill does not show the House at its best. All the speeches, apart from those of my hon. Friends the Minister for Competition and Consumer Affairs and the Member for Newcastle upon Tyne, Central (Mr. Cousins) and myself, were a defence of professional privilege and attitudes, even those of the Liberal Democrats—that party should be speaking for the people, but its members concentrated on the purpose and privileges of solicitors and the professions, not on countervailing their power. That does not show scrutiny at its best.
  In conclusion, to recoin an old Irish joke, like the man in Little Grimsby who asked the way to Great Grimsby and was told, "I wouldn't start from here," I would not start from here. Unfortunately, we are doing so. It is right now that we should ensure the proper regulation of the powerful accountancy houses and of the profession. It is right now to enhance the power of stakeholders in response to the privileges that are being conferred on the accountancy profession. It is also right to argue that audit work should be split from the sale of other services. That is the next agenda on reform, and I hope that we go on to undertake it. In conclusion, I thank my hon. Friend the Minister for a sterling performance: he has listened, responded and treated all the arguments with respect, intelligence and courtesy, and I congratulate him on that.
  7.10 pm
  Mr. Fabricant: I support the Bill and, as the Minister knows, I served on the Committee that considered it. The Bill had its genesis in the last Parliament, and it is right and proper that the present Government should continue with the measure.
  The hon. Member for Great Grimsby (Mr. Mitchell) gave a long catalogue of complaints against the larger accountancy firms. Even if he were right, I can see no reason why that should inhibit the Bill's passage, as the Bill relates to a very different issue. Certain concerns were raised by my hon. Friend the Member for Bognor Regis and Littlehampton (Mr. Gibb). I am especially concerned that, in this Bill, as in other Government Bills, there is yet again, a blank cheque in relation to secondary legislation. Something that is important and ought to be included in the Bill is going to be left to delegated legislation.
  On this occasion, the issue is the level of offences and the penalties that will accrue to them. That is particularly strange, as I pointed out in Committee, because clause 9(6) deals with the level of offence. It states:
  A person guilty of an offence under subsection (4) is liable on summary conviction to a fine not exceeding level 5 on the standard scale.
  The Government are therefore able to state what the level of offence should be. It is inconsistent and wrong that they choose not to do so with other offences which are named, quite rightly, in the Bill.
  964
  Government Members have expressed concern about the principle of the Bill, which is the removal of joint and several liability of partners. However, as the Liberal spokesman, the hon. Member for Torridge and West Devon (Mr. Burnett), pointed out, along with my hon. Friend the Member for Bognor Regis and Littlehampton, nothing under the law on civil torts prevents a prosecution against a particular partner for duties that are not carried out in accordance with the law. That is right and proper, and that facility will not be removed by the Bill's enactment.
  The Bill is needed. The movement since 1890 towards a global economy means that a partnership alone is not enough in this day and age. The hon. Member for Great Grimsby highlighted the growth of the larger accountancy firms. I agree that that has happened in the United States of America, which has protection similar to that proposed in the Bill. We need that protection here in the United Kingdom. As I said in Committee and earlier today, there must be equity between the protection afforded in overseas countries and that offered in the UK.
  With those reservations, I join my hon. Friend the Member for Bognor Regis and Littlehampton in wishing the Bill a fair passage. Despite our reservations about it, it will be good for business and, more important, good for British jobs.
  7.14 pm
  Mr. Stuart Bell: I shall briefly commend the Bill and add to the comments of the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb). It is perfectly right to say that the Bill owes its origins to Lord Freeman, who was Minister at the time. It was quickly taken up by the Labour party in opposition, and in our manifesto we said that we would introduce a Bill on limited liability partnerships. We also made a commitment to independent regulation, to which I shall return in a moment.
  I commend the hon. Members for Bognor Regis and Littlehampton and for Torridge and West Devon (Mr. Burnett) and Opposition Back Benchers. I have forgotten which queen said that when she went to her grave and they opened her heart, they would see Calais written upon it. [Horn. MEMBERS: "Mary Stuart."' I thought it was, but I did not dare say so on the spur of the moment, in case I would stand corrected later. I commend my hon. Friends the Members for Great Grimsby (Mr. Mitchell) and for Newcastle upon Tyne, Central (Mr. Cousins), as I have a feeling that, when the LLP graves of the accountants and solicitors are opened up, they will see "Great Grimsby" and "Newcastle, Central" engraved inside. Anyone wishing to know what my hon. Friend the Member for Great Grimsby will do for an encore on independent regulation was given a reasonable impression tonight.
  Finally, I commend with the utmost sincerity my hon. Friend the Minister and his staff at the Department of Trade and Industry, who have lived with the substance of the Bill for four years—one year in opposition and three in government. The Bill has followed the new parliamentary procedures introduced by the new Labour Government, has gone through a Select Committee and pre-legislation Committees and, after three years, has emerged as better legislation. This is a great day for parliamentary procedure, the Ministry, the Government and the House of Commons. I commend the Bill to the House and, as the hon. Member for Lichfield (Mr. Fabricant) said, I wish it a safe passage.
  7.16 pm
  Mr. Stephen O'Brien: As I did at the beginning of Second Reading and in Committee, I declare an interest as a fellow of the Institute of Chartered Secretaries and Administrators and as a parliamentary adviser to that body. I have been a non-practising solicitor since 1988.
  I welcome the Bill and I pay particular tribute to the way in which it was handled in the other place before it came here. I pay special tribute to my colleague Baroness Buscombe who made a number of points that helpfully illuminated ways in which the Bill could be improved and in which the Houses of Parliament could introduce legislation that would be welcome and, we hoped, would improve company competitiveness and international location, so that companies that need to compete can make sure that they reside appropriately in this country.
  I made a number of points on Second Reading and in Committee, many of them born out of my personal business experience, in so far as I have dealt with—indeed, I have established—an LLP in overseas territories and was responsible for it. I therefore have some experience which I have tried to bring to the attention of the House. I certainly wish to support fully all the points made by my hon. Friend the Member for Bognor Regis and Littlehampton (Mr. Gibb) and to back his careful, well-judged scrutiny of the Bill, especially the default provisions and, indeed, the Henry VIII clause.
  It is disappointing, however, that the Government's approach to retaining that clause in the Bill has left a residual doubt about whether there will be proper scrutiny of potentially serious provisions that could be added later and which would have a direct effect on the competitiveness and effectiveness of this form of corporate entity. Above all, there is a need to take account of what the hon. Member for Great Grimsby (Mr. Mitchell) said and to ensure that there is total transparency and disclosure, which is the price to be paid for conferring limited liability on what were unlimited corporate entities.
  I fully acknowledge that the Government have acknowledged the matters that I have raised, but it is disappointing that they have not acted on a couple of important points that highlight the concerns of those with experience of these issues. I shall re-emphasise a couple of those points, and I crave the indulgence of the House to place them on the record. First, the Bill has focused, quite understandably, on large professional partnerships, and I fear that implications about the way in which the new corporate entity will be used have been missed.
  Again, from my experience, I think that it is clear that the LLP will be a very attractive vehicle for overseas partnering and joint ventures in this country. Certainly that is the way in which a similar measure was applied in California and other states in America. It carries certain tax advantages and also rightly reflects the business relationship in manufacturing companies, with which I am familiar.
  Despite raising those issues in earlier debates, I have not heard a reply from the Minister, and I note that he has been well supported by a raft of advisers here—they are sitting in the box—and in Committee. I asked whether advice had been fully taken on the experience of those
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  overseas territories in which there are joint ventures for manufacturing companies, and it would have been helpful to have heard a reply.
  Dr. Howells: I assure the hon. Gentleman that we took advice. I understand the point that he makes, and I hope that a wide range of LLPs will be formed.
  Mr. O'Brien: That is somewhat reassuring, and I thank the Minister for letting me know that that advice has been taken. It would be helpful to share it a little more fully later.
  Such entities will be attractive to property companies, which, as we know, have particular risks and liabilities. The contractual and relationship issues in business are often represented by those concerned with property valuations and the title to ownership, and LLPs will hold a significant attraction to property ventures. There is a demand in property companies to examine—again, reflecting experience abroad—whether it would be appropriate and sensible for their competitiveness to create a mechanism by which a particular partner in such a property LLP could opt out of being bound. At the moment, all LLP members will be entitled to buy because of the way in which LLPs are structured. That is a matter of serious debate because of the nature of accountability and transparency, but is also goes to the heart of the way in which property risk is assessed and represented. Although I mentioned that in Committee, I wanted to place it on the record again now.
  The Minister generously suggested that I had made some constructive points during the consideration of the Bill. I am not flattered, because I realise that that is part of the hon. Gentleman's customary generosity. But I am concerned that the points that I made on clause 8 were not taken up. The concern is that there has been an attempt to retain the partnership ethic, by which all members take responsibility, under the requirements of clause 8, unless at least two designated members have been appointed.
  Although I can understand the mindset that has driven that provision, I am concerned especially about those LLPs that will not have the appropriate expertise, such as firms that are not accountants or solicitors, which, again, have driven the thinking on the provision. Given the importance of the compliance and governance needed to deliver the very transparency and accountability that is at the heart of the Bill, it would have been appropriate to examine more closely the possibility of having a partnership secretary, company secretary, or a designated person.
  There is a distinction to be drawn between members, who clearly carry the overall business responsibility and accountability, and those who are required to deliver compliance and governance. As the Minister has said, nothing precludes an LLP appointing such a person as an employee. However, it would have been better to state that in the Bill, if for no other reason than that similar provisions exist under the Companies Acts for company secretaries in plcs. That confers the necessary status and authority in the corporate entity to command the necessary respect around the board table—or, in this case, around the LLP members table—where advice, high technical competence or a degree of conscience are required of the corporate entity to ensure governance. That is the case not least because things are not always

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  rosy in partnerships; there will be disputes and factions. At times, it is helpful if such a person sits at the high table with the status and professional expertise to take the necessary action. It is disappointing that that point has not been taken more seriously.
  That said, I have thought carefully about the Bill and whether I should have tabled amendments in Committee and on Report. I chose not to do so because the Bill is part of a wider issue; a major consultation exercise is being undertaken on company law reform. That consultation has run somewhat parallel to the Bill, but the latter preceded it because of the way in which the legislation has come about. In that context, I hope and request that the Minister and his officials in the Department will carefully consider the points that I made about clause 8; they are even more important in the context of that company law reform.
  We should take advantage of all that has been learned about governance during the past 10 years, not least from the Cadbury report and the ensuing developments. We should at last put the genuine expectations about what is required of companies on a much more sound footing, and perhaps frame them in statute. We should ensure that they have the requisite person in place to ensure good governance. I shall defer pressing that point until we debate company law reform. I thank the Minister for the courtesy with which he has treated the points that I have made. I, too, agree that the process has been worth while.
  Question put and agreed to.
  Bill accordingly read the Third time, and passed, with amendments.

Fur Farming (Prohibition) Bill
Not amended in the Standing Committee, considered.
Clause 2

  FORFEITURE ORDERS
  7.26 pm
  Mr. Malcolm Moss: I beg to move amendment No. 2, in page 2, line 2, leave out 'or other disposal'.
  Mr. Deputy Speaker (Mr. Michael J. Martin): With this it will be convenient to discuss the following amendments: No. 3, in clause 3, page 2, line 22, leave out `or other disposal'.
  No. 4, in page 2, line 26, leave out 'or other disposal'.
  Mr. Moss: These amendments, which my hon. Friend the Member for Cotswold (Mr. Clifton-Brown) and I have tabled, relate to clauses 2 and 3. Clause 2 deals with forfeiture orders that a court may make if a person has been convicted of an offence of keeping an animal for fur under clause 1. Clause 2(3) states:
  a forfeiture order is an order for the forfeiture and destruction or other disposal—
  those are the key words—
  of the animals.
  A similar provision is contained in clause 3(3)(b) and (c), where the words "or other disposal" are used.
  The purpose of the amendments is to discover what disposal will be possible, other than the destruction of the animals subject to the forfeiture order. After all, by definition, those provisions will not come into play until fur farming becomes a criminal offence, so there can be no question that the animals will continue to be farmed. Although the Bill refers to animals raised for fur, we know that its thrust is against the 13 mink farms that currently exist in this country. Mink are the only animals likely to come within the ambit of the Bill. Mink are not likely to be regarded as ideal pets for anyone.
  We want the Minister to explain why an alternative provision exists, other than for the destruction of those animals. Mink are not only unsuitable to be kept as pets, but they are extremely damaging and dangerous animals in the wild, and significant costs have been involved—
  Maria Eagle: Has the hon. Gentleman had an opportunity to read the Hansard reports of the Standing Committee that considered a similar Bill in the previous Session? If he has, he will have found that his questions are answered there.
  Mr. James Gray: So what?
  Mr. Moss: We want the Minister to tell us why the Bill still contains those words, despite comments made recently in Committee. We recognise that the Bill relates primarily to mink. We know that they cannot be kept as pets and that they create huge damage if they are released or escape into the environment. The only sensible action to take under a forfeiture order will be to destroy those animals.
  7.30 pm
  Mr. Andrew Hunter: I speak in support of the amendments, and I immediately assure the hon. Member for Liverpool, Garston (Maria Eagle) that not only have I read the Official Report of our Committee proceedings this year, but I can vaguely recall the Committee proceedings of the previous year.
  I support the amendments, because we have still not received an adequate answer to a point that we have raised time and again. The hon. Lady and the Minister might recall that when I moved a similar amendment last year to a similar Bill, I advanced the argument that my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss) has just made. In reality, we all know that there is no alternative to destruction for the overwhelming majority of animals currently farmed for their fur. Because of that, we are entitled to ask why the Bill contains the words "or other disposal".
  On previous occasions, hon. Members who support the Bill, and the cause of which it is an expression, have sometimes intervened with the telling word "chinchilla". I would not claim to be an expert on the habitat and the natural habits of the chinchilla, but it has been offered to us as the reason for the three words "or other disposal" appearing in the Bill. It has been explained that in some circumstances chinchilla can become domestic pets.
  That proposition is particularly intriguing. Perhaps chinchilla are capable of becoming domestic pets, but what is the welfare ground for objecting to their being farmed? It would seem that an animal that can adapt itself to domestic circumstances can also adapt to being farmed, if that takes place with the due regulations for its welfare in place. The defence of the words "or other disposal" opens another weakness in the Bill. What are the welfare grounds for the criminalisation of the farming of a particular species of fur-bearing animal?
  There is another dimension to the amendments and to the inclusion of the words "or other disposal" that puzzles me. As the House will know, the words stem from a forfeiture order made under clause 2(1), which states that a
  court may make a forfeiture order in respect of any animals of that description.
  That provision applies to animals that are farmed primarily for their fur, and it refers to those that
  are kept by that person when the order is made or which come into his keeping during the relevant period.
  I am concerned by a court's ability to make a decision as to whether the forfeiture order should be for destruction or for "other disposal". What mechanisms are being created or exist whereby the court will have the information that, let us say, 3,000 chinchilla are kept on a farm in England or Wales and are nurtured for their fur? How can a court know with any degree of certainty whether those 3,000 chinchilla can be forfeited for a purpose other than destruction, and if so, what proportion of them does that apply to? That argument may seem reductio ad absurdum, but much in the Bill is capable of such an interpretation. Lawyers will have a field day when, as is inevitable, the Bill becomes law.
  The amendments point to a weakness in clauses 2 and 3. The court will not be able to make a sound or reasonable judgment under the existing mechanisms as to whether another form of disposal is possible. That brings
  970
  us back to a point made by my hon. Friend the Member for North-East Cambridgeshire. We know perfectly well that when a forfeiture order is made, the animals will be destroyed. It follows logically that the Bill should contain provision only for destruction and that the words "or other disposal", which appear in clause 2(3) and 3(3)(b) and (c), should be omitted. That would make the Bill tidier, and it would be common sense.
  Mr. Gray: I wish to add a few words in support of the amendments tabled by my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss), to which my hon. Friend the Member for Basingstoke (Mr. Hunter) so ably spoke. I did not have the good fortune to serve on the Standing Committee considering this Bill, or on that considering the private Member's Bill promoted by the hon. Member for Liverpool, Garston (Maria Eagle). Despite the fact that I have read the Hansard reports of both Standing Committees with care, I was not quite as up to date with the arguments as she thought I should have been.
  The hon. Lady made an odd intervention that seemed to suggest that if this or any other Bill has been discussed anywhere in Parliament, it is in some way improper to discuss it again on Report.
  Maria Eagle: I was not suggesting that it was improper to discuss anything that is in order on Report. I merely pointed out that hon. Members had already been given an answer.
  Mr. Douglas Hogg: It was not a satisfactory answer.
  Mr. Gray: As my right hon. and learned Friend says, it was not a satisfactory answer. However, the Minister will have an opportunity to remind us of the answer, and we shall have the opportunity to scrutinise his remarks. The hon. Lady intervened on my hon. Friend the Member for North-East Cambridgeshire and suggested that his speech was a waste of time because his question was answered during consideration of an obscure private Member's Bill a year or so ago. That is a fundamental misunderstanding of the way in which the House operates.
  Mr. Deputy Speaker: Order. I hope that the hon. Gentleman will not labour that point, because I called him to speak to the amendment.
  Mr. Gray: I am happy to do that, Mr. Deputy Speaker.
  The provisions are important because they appear to have a sinister undertone. If the Bill brings about the end of fur farming, we must be clear what will happen to the 100,000 mink that are farmed in this nation. If we are not, a Bill that purports to be about animal welfare may turn into one that creates a nightmare for those animals. The House must be clear what will happen if we put mink farmers out of business. What will happen to the mink on their farms? The Bill uses the phrase "or other disposal" and that leaves open the possibility that the animals will be disposed of inappropriately.
  I am not convinced that the Bill applies only to mink, although they will form by far the largest category of animals affected. On Second Reading, I asked whether a flock of sheep farmed exclusively to produce sheepskins

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  would be covered by the Bill. The Minister may correct me later, but my understanding is that the conclusion was that it would be illegal to keep a flock of sheep purely for the purpose of producing sheepskin rugs. Indeed, under the Bill it would be equally illegal to keep rabbits solely for their fur.
  Given the state of market for mutton, if not for lamb, I understand why it might be possible for a farmer to decide that a flock of sheep should be kept specifically for the purpose of selling their skins. We do not want to get into an argument about the precise price of mutton, but that must be theoretically possible. If I were a farmer with a flock of sheep on the uplands that I knew would be worthless on the livestock market and I saw the Bill going through Parliament, I might declare today that my flock were being kept purely for their fur. The compensation that we hope will be available under the Bill may turn out to be a great deal more generous than the price that the unfortunate farmer would earn for his flock of sheep in the market.
  Mr. Hogg: I am listening to my hon. Friend's argument, and I have heard something of the kind before. He faces one problem, of course: the word used in subsection (1)(a) is "fur". Whatever else is true of sheep, they do not produce fur. Does my hon. Friend agree, nevertheless, that that argument demonstrates the nonsense? It probably would be lawful to breed sheep exclusively for wool, but not lawful to breed mink exclusively for fur?
  Mr. Gray: My right hon. and learned Friend makes a good point, but he slips up at the end. It is legal to breed sheep exclusively for the purpose of their wool, which is shorn, and the animal remains alive. If sheep are bred exclusively for the purpose of producing sheepskins, the animals have to be slaughtered in order for the sheepskins to be obtained.
  Mr. Hogg: The last thing I want to do is to fall out with my hon. Friend, because basically we are in the same camp. However, the word in the Bill is "fur". Whatever else is the case, sheep do not produce fur. They may produce skins and they may produce wool, but fur they do not produce.
  Mr. Gray: That is an interesting point of definition, which is at odds with what the Minister made clear on Second Reading, when he said specifically that in the unlikely event of a flock of sheep being bred for sheepskins, which would require their slaughter, that would come under the terms of the Bill. However, my right hon. and learned Friend may well be right. He speaks as a barrister and charges hundreds of thousands of pounds an hour for just such advice. He may be right that the word "fur" cannot be construed as applying to sheep.
  Mr. Hunter: Pursuing my hon. Friend's recollection of the Minister's reply on Second Reading, I suppose that that could also apply to ostrich farming. The bottom has fallen out of the ostrich meat market. Now the birds are farmed for their feathers and, for tourist reasons, for their eggs. If the Minister's answer on Second Reading was correct, the Bill has ominous implications.
  Mr. Gray: My hon. Friend makes a useful point. When the Minister responds, perhaps he will tell us what the Bill
  972
  intends. If it applies purely to mink, he must say so. If there is the possibility that ostrich, deer, sheep or rabbits may come under the terms of the Bill, the precise means of disposal of the animals becomes a matter of key interest to those of us who are fundamentally concerned with animal welfare.
  We need to know precisely what will happen to the animals. There are 130,000 mink and they are breeding all the time. People tend to forget that the animals breed like mink, and presumably the population will increase. Other kinds of animals, such as ostriches and sheep, may come within the purview of the Bill, and it is only reasonable that before we send it on its way from this place, we should know with great precision and clarity the means by which the animals are to be disposed of. It is worrying that that should be left to an open expression such as "or other disposal".
  For the purpose of the amendments, it is reasonable to assume that we are dealing primarily with mink, although I look forward to the Minister commenting on other animals. Let us focus on what will happen to the mink. We must be clear whether the compensation terms that are the subject of the second group of amendments are dependent on the mink being slaughtered, or on a forfeiture order being issued against the farmer.
  The winding down of the mink farms over a number of years, which seems to be the intention behind the Bill, may be sensible, but the mechanism by which that will happen has not been spelled out in the Bill or in the explanatory notes to it. The Minister may want to explain how that winding-down process will happen.
  If we are to presume that the end of mink farming will mean the slaughter of the 130,000 existing mink in the UK, it is important that we should know precisely what the means of slaughter will be. Various ways of killing mink are used. The most common are gassing by carbon monoxide or carbon dioxide. Hon. Members will know that many people commit suicide by carbon monoxide gassing, directing fumes from the exhaust through the car windows. It is said to be a painless way of committing suicide. Carbon dioxide, I believe, is less attractive, but none the less can be used in some circumstances. Another method is by lethal injection, which may occur in some mink farms, although it is difficult to imagine catching the mink in order to administer a lethal injection.
  7.45 pm
  The reason for those methods of killing is that the perfection of the pelt is important. The only value of the animal is the pelt. If mink were slaughtered by the conventional means used for other animals, the pelts would be damaged. It is important that those of us who care about animal welfare should know whether the farmers will be required to carry out the slaughtering themselves. At present, most slaughtering of mink takes place on the farm, because the transportation of the mink to a slaughterhouse is considered to be a great deal more harmful to them than being slaughtered on the farm. The first question, then, is whether the slaughter will be carried out on the farm.
  Secondly, will the farmers be allowed to sell the pelts produced from that slaughtering? I assume so. If that is the case, presumably the slaughtering must occur by means of CO2 CO or lethal injection. Will the Minister tell us which method of slaughtering he thinks will be

  973
  most appropriate? Will he consider not just adult animals, but the newly born? Will the newly born be killed by the same means? Will MAFF vets be present to supervise the process? What will happen to the carcases? Will there be proper disposal?
  What will happen to the pelts? Will they be sold to British fur dealers, or will that be considered immoral? It is the Minister who changed the thrust of the Bill from animal welfare to morality. If the pelts are not sold to British fur dealers, perhaps there is the strange prospect that they will be sold to foreign fur dealers. Once fur farming is abandoned in this country, foreign fur dealers will make all the money out of it.
  The Minister must be specific about what he expects to happen in the process of killing and disposing of the animals. He must also be specific about whether the agreed compensation will be paid if farmers carry out the slaughter voluntarily, or only if they are required to do so under the forfeiture orders. In the latter case, presumably, the farmers will do nothing until the forfeiture orders are served on them. That will not necessarily produce the most orderly or humane way of carrying out the slaughter.
  We need answers to various questions about how the animals will be killed, the means by which they will be disposed of, and what will happen to the pelts thereafter. Those are the large questions about the slaughtering process which we believe, unwelcome though it is, will be the result of the Bill. If not, the words "or other disposal" become relevant.
  What else could be the fate of those 130,000 mink? We are not sure whether they will be killed by CO2 by carbon monoxide poisoning, by having their little throats slit or by being chucked into a ditch. We are not sure what will happen to them. We must be clear about that. If the Minister makes use of the expression "or other disposal", what does he have in mind?
  When Lord Burns considers what will happen to foxhounds if, unfortunately, there were a ban on fox hunting in this country, he suggests that the redundant foxhounds could be re-homed, as he calls it. I am not sure whether that is a word. Is the Minister considering the possible re-homing of mink? I hope not. Perhaps he will require the farmers to keep the mink until they grow old and die, in which case what does he propose to do about all the breeding that the mink will do in the meantime? Maybe he is considering releasing them into the wild. That is a solution that has been put forward by a number of his friends—his past leads me to think that they are his friends—in the more extreme animal welfare lobby. They have released mink into the wild with catastrophic consequences. We see on rivers throughout the country what happens when that happens.
  The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Elliot Morley): Will the hon. Gentleman give way?
  Mr. Gray: As I have named the Minister, perhaps unfairly, I shall give way to him.
  Mr. Morley: I hope that the hon. Gentleman will withdraw. I have spoken out on many occasions against
  974
  illegal activities, including the deliberate release of mink into the wild. That has been my long-standing position, and I have been robust about it.
  Mr. Gray: If that is what the Minister understood by my remarks, I withdraw. I would not for a moment suggest that he condoned such illegal activities. I know that he has been robust in saying that they must not happen. I also know that he has a long and distinguished record and career in the animal welfare and rights lobby. My precise words were that his friends in the animal rights lobby do the things that I have described. I was not suggesting that he did. If that was his interpretation of my remarks, I apologise. I know perfectly well that he would not take such action.
  Perhaps the Minister would not suggest that mink should be released into the wild, but there are certainly those on the more extreme wing of the animal rights movement who would. If that were to happen, I think that hon. Members on both sides of the House, and those on both sides of the argument, know how catastrophic the results would be for native wildlife. I hope that the more extreme voices will not be heard.
  Perhaps mink could be sold alive. There are those, perhaps the farmers themselves, who would say, "There are perfectly good fur farmers 20 miles away across the channel in Calais. I shall transport my 100,000 live mink in cages to Calais." Will that be allowed? We no longer allow the export of live calves. Are we to allow the live export of mink? I do not think that we should. The carrying around of mink in cages on lorries is probably less humane than slaughtering them on the farm. That is the view that has been taken by slaughterhouses. I do not think that mink should be exported, and certainly not to Calais. Even less should they be exported to Russia, where much mink farming continues. Similarly, they should not be exported to Canada.
  The words "or other disposal" presumably allow the possibility of live export of mink. I suspect that the Minister should ensure that the wording of the clause is made much more precise so that we know exactly what is intended to happen to mink. On Third Reading, I shall talk about the more general principle, but I am not convinced that there is a moral argument in favour of banning fur farming. There may be an animal welfare argument in favour of it, but I suspect that that can better be answered by laying down regulations for the better protection of the animals in their cages, as we did for pigs, for example, than by the enactment of the Bill.
  If the Bill is to become law and if we are to see the 130,000 mink now alive disposed of, it is extremely important that we and others who care about animal welfare should know precisely what the Government have in mind for their disposal. Are they to be carried overseas in ships or aeroplanes? Are they to be slaughtered by humane means or by less than humane means on the farm? Are they to be transported to slaughterhouses to be disposed of? What is to happen to the pelts and the carcases?
  These are issues that may be dismissed by those who are interested only in the so-called moral issues, but they are important to farmers and to those of us who truly care about animal welfare. That is why these amendments are more probing than anything else. What does "or other disposal" mean? What lies behind the phrase? What is in

  975
  the Minister's mind? What other means of disposal could there be? Are those other means of disposal acceptable to a humane society? I suspect that they may not be.
  I suspect that the Bill would be a great deal better drafted, clearer, and better from the point of view of the welfare of the unfortunate mink, if the words "or other disposal" were struck out in the three places where they currently appear.
  Mr. Owen Paterson: Returning to this subject is rather like the end of term. Several Members now in their places considered the earlier private Member's Bill, served on the Committee considering this Bill, and have also considered it at other stages. It has been rather like a dialogue of the deaf, and now we are all reassembled. My hon. Friends and I are making same old points, which, sadly, have not sunk in with the Government draftsmen, and the Bill is as bad as it ever was.
  I shall begin by considering what will be caught by the forfeiture order, and perhaps clarify the matter for my hon. Friend the Member for North Wiltshire (Mr. Gray) and for my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg). I suggest that we consider the problems with which magistrates will be faced if the Bill becomes an Act. The starting point is the definition of fur when deciding where the forfeiture order comes from.
  Clause 1(1) states:
  A person is guilty of an offence if he keeps animals solely or primarily … for slaughter … for the value of their fur.
  I would go to the definition in the Official Journal of the European Communities.
  Mr. Deputy Speaker: Order. The hon. Gentleman cannot discuss that matter under the amendments, which relate just to the words "or other disposal". They are narrow amendments.
  Mr. Paterson: I am trying to define which animals will be caught by the requirement in clause 2(3), Mr. Deputy Speaker.
  Mr. Deputy Speaker: Order. We are discussing an amendment, not a clause. As I have said, the amendment is narrow. Perhaps the hon. Gentleman will have a glance at the amendment and then speak to it.
  Mr. Paterson: Thank you, Mr. Deputy Speaker.
  The amendments are clear in that they remove the words "or other disposal" from one place in clause 2 and two in clause 3. Surely it is important to define which animals will be caught by the Bill. There is some misunderstanding about what counts as fur. We must consider the problem of a magistrate who has to interpret this measure once it becomes law. When faced with a possible prosecution, how will the magistrate define which animals will be caught by the Act?
  Is it sensible to let the clause stand as it is, and provide for either destruction or other means of disposal? Or, as we suggest in the amendment, should destruction be the only solution? I can refer to a lengthier definition, possibly on Third Reading. The definition of "raw fur skins" means not only the skins of mink and rabbit but
  976
  those of various types of lamb. Following your instruction, Mr. Deputy Speaker, I shall go into these matters at greater length later in our consideration of the Bill.
  There is no problem in disposing of some sorts of lamb by other means. I do not see a problem in selling astrakhans, broadtails or caracals. We can go into that later. A hole in the Bill is that it would be possible to raise a bovine animal for the value of its hide if it had fur on it. The Minister shakes his head. I accept that we have had these disputes in previous discussions. However, as the Bill is drafted, it would be possible to raise a bovine animal such as the belted Galloway, which would possibly have a very valuable hide. That would come under the definition in chapter 43 of the Official Journal of the European Communities. Again, the Minister shakes his head. However, he is wrong. It is an unlikely event, but such an animal could be covered by the Bill.
  In any event, I would let the clause stand for the disposal of bovine animals or ovine animals—sheep or goats. I do not see a problem in moving them on. However, we cannot allow mink or smaller farmed animals to be disposed of elsewhere. There is great skill in looking after mink. As we know, there is a huge raft of legislation that binds current farmers. We know that there are only 11 of them. They do their job with great diligence and skill, and there have been very few escapes, apart from unnecessary releases caused by animal activists. It is incumbent upon the farmers to ensure that the animals do not escape. If anyone else is involved, an escape is possible. I have seen horrendous damage done by escaped mink in the borders of Wales where I live. The water rat population has been virtually eliminated and ground nesting birds have been destroyed. This has probably been done by mink which at some stage have escaped from fur farms.
  I have great confidence that the 11 fur farmers who remain are highly competent and skilled at their job and well qualified to organise the destruction of the mink. My hon. Friend the Member for North Wiltshire discussed various methods of destruction. As I understand it, every mink farmer in this country gases the mink. The process is extremely swift, and dramatically more humane than what we put cattle through, transporting them long distances under the Government's over-30-months scheme, for example. The mink is transferred from its cage to a small box a few feet away and rendered unconscious within seconds. I think that it dies in under a minute. It is a very swift process.
  8 pm
  Mr. Gray: For the sake of accuracy, may I say that I think that three methods are permitted under the law: carbon dioxide, carbon monoxide and lethal injection, although I am not sure that any of the farmers use that last method?
  Mr. Paterson: My hon. Friend is correct, as always. Those methods are permitted, but all the fur farmers to whom I have talked have said that a carbon dioxide gas box is their preferred method. They are experts and the job is done properly and humanely. The mink hardly know what is happening to them. The farmers have all the facilities for skinning the carcases, retaining the pelts and disposing of the offal and the bodies.

  977
  It is most important that those people should be responsible for the disposal of the mink, as transporting them elsewhere and letting less skilled people get involved, however well-meaning they may be, would not be right, because they would not have the necessary experience or equipment.
  It is vital for the smaller animals—mink and fox, in particular, although no foxes are farmed here at present—to be destroyed on the spot by those who have looked after them in the preceding years. No one else is qualified, and any other solution could lead to escapes, which can have devastating consequences for the environment, as we have seen.
  Mr. Geoffrey Clifton-Brown: I want to raise two points that I raised in Committee—people feeling so desperate that they release the animals into the wild, and the sale of animals into Europe where there is no protection and from where the pelts could be reimported into this country. That would be an act of folly involving a great deal of taxpayers' money.
  I want to remind the House of what the Bill provides for, as that will set the scene and explain why the people to whom the provisions apply may be in a pretty desperate state. They will have committed an offence, as provided in clause 1(1) and (2); they will have been fined by the court; the court will have issued a forfeiture order, as provided in clause 3; and an appeal may have taken place. The poor mink farmer will have had considerable legal procedures deployed against him by the time that the destruction of the animals is ordered. We need to be sure when we pass legislation that it is crystal clear and nothing is left to chance. The words "or other disposal", which the amendments would delete, leave matters to chance.
  When the courts have acted as I have described and the fanner has been fined up to £20,000, as provided in clause 1, he will then, under clause 3, have lost all his rights to the animals, which I assume means that he will get no compensation, yet he will be faced with the costs of disposal. I am very concerned that, under such circumstances, a desperate farmer or his friends may simply say, "Well, we've gone through all this, so let's just let them out."
  When some animal rights activists released some mink, the effects on the local wildlife were absolutely devastating. Mink are some of the most vicious animals in this country. I may be one of the few people in the House who has been close to them, and I can tell hon. Members that they are absolutely vicious. When they are cornered, they take no hostages and can do very considerable damage to a human being.
  Mr. Gray: I have enjoyed listening to my hon. Friend, but I must take issue with him. I can imagine no circumstances under which mink farmers, who are responsible and sensible people, would release their mink into the wild. He is wide of the mark in suggesting that. The people who would do that are the animal rights activists, who have no conscience and no control.
  Mr. Clifton-Brown: I hear what my hon. Friend says, but a mink farmer who has lost all his rights to
  978
  compensation, has been fined and issued with a forfeiture order, and will be involved in considerable expense, may well be tempted to let the animals out rather than foot the bill for their destruction.
  I was describing the effects on wildlife and the danger to human life that would follow.
  Mr. Hunter: I want, with a constituency point, to encourage my hon. Friend to pursue that line. Mink released in the south of Hampshire have made their way north to the Basingstoke canal in the vicinity of the village of Greywell, and the devastation being caused to wildlife there is quite horrific. I was especially disturbed when a well-known animal welfare supporter in the area wrote to my local paper extolling the virtues of mink living in the wild. Some people's attitude on the issue is incomprehensible.
  Mr. Clifton-Brown: I totally agree. Any animal lover who wants to see mink living uncontrolled in the wild really does not understand them. They are absolutely vicious creatures and will kill other wild animals and pose a distinct threat to any human being who gets near them.
  I take the point of my hon. Friend the Member for North Wiltshire (Mr. Gray), but if there is the remotest chance of the Bill encouraging the release of mink, we should be extremely careful about it. I accept that the Bill's main purpose is to ensure that the farming of mink ceases, so the danger will also cease over a period.
  My other fear is that the words "or other disposal" could allow the animals to be sold into Europe, where mink farms exist perfectly legally. The Minister said:
  I might add that there is nothing to stop farmers winding down their businesses immediately if they so choose. Disposing of their stock will not preclude them from the compensation scheme.
  He was talking about a time before the forfeiture order is issued. I assume that once the order is issued, farmers will not be entitled to any compensation, but perhaps he will clarify that when he winds up.
  The important part of the Minister's comments is:
  It would certainly be legal to sell breeding animals—abroad, for example—in the winding-down period, although farmers would not be able to claim compensation for the livestock because they would have received money for it.
  Of course that is right.
  After the winding-down period, of course, it would be illegal to have those animals.—[Official Report, Standing Committee E, 6 June 2000; c. 82.]
  Although it would be illegal to have the animals, farmers would have them—otherwise, the court would not have issued a forfeiture order. The court would have to consider how best to sell the animals and might well decide that it would be perfectly legal to export them to be kept in Europe. It would be totally unacceptable if we used taxpayers' money to compensate for the cessation of such businesses only to find that they were carried on in Europe and that the pelts, either raw or in clothing, were exported to this country.
  Mr. Hogg: In fact, the animals would not need to be exported so far. Under the "other disposal" provision, the animals could be exported to elsewhere in the United Kingdom to which the provisions of the Bill do not apply, such as Northern Ireland.
  Mr. Clifton-Brown: I am grateful to my right hon. and learned Friend for raising that point, too. Such action is a distinct possibility as the Bill covers only England and Wales.

  979
  When I raised the point in Committee, the Minister replied that it would be up to the Scottish Parliament to make provision in Scotland and the Northern Ireland Assembly to make provision in Northern Ireland. There is a distinct danger that unless we get this legislation right tonight, farmers who wish to remain in business will relocate their operations in those provinces. I cannot see any reason why they would not be compensated for going out of business, but could then set up another organisation in Scotland or Northern Ireland for the same animals. A little nonsense is creeping into the Bill and the Minister must say what steps he will take to stop the exploitation of such lacunae.
  Mr. Gray: I am sorry to interrupt my hon. Friend's flow for a second time and shall try not to do so again. He has brought to mind a peculiar thing. Hon. Members who represent Scottish constituencies will vote to close mink farms in England, yet, as my hon. Friend describes, it is perfectly possible for the same mink to be exported to their Scottish constituencies, where fur farming will continue unless the Scottish Parliament decides otherwise. Is not that absurd?
  Mr. Clifton-Brown: I am sure, Mr. Deputy Speaker, that you would rule me out of order if I followed my hon. Friend down that path, but devolution creates all sorts of problems and anomalies. I have described the possible lacunae. Somebody could move their operations, perhaps under another guise, to Scotland or Northern Ireland, and perhaps not claim compensation for the animals because they retained, sold or were deemed to have sold the animals, and nevertheless claim compensation for clearing land, loss of business, good will, loss of earnings and all the things that we shall discuss in the next debate on compensation provisions.
  Amendment No. 2 is interesting. The Minister will have to tell us very clearly what he has in mind in including the words "or other disposal". There will be circumstances that none of my hon. Friends or myself has thought of in which animals could be disposed of. I have no doubt that people in desperate circumstances will think of all sorts of ways. They may take advice from expensive learned friends, such as my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg), and find ways to exploit the Bill. Therefore, it is ever more important that we save them the trouble of doing so and make the Bill clear.
  Mr. Paterson: On my hon. Friend's comment that the chances are that farmers will move elsewhere, the only known case is in Austria, where Mr. Pfeiffer moved from lower Austria 30 miles over the border to the Czech Republic.
  Mr. Clifton-Brown: I am grateful to my hon. Friend for that information. It is interesting, if not directly related to the amendments.
  The point at issue is that we are depriving people of their livelihood and therefore need a Bill that is utterly fair and clear. Unless it is, there will rapidly be a challenge in the European Court of Human Rights. That is all the more likely if, having drawn attention to the point, the Minister is not crystal clear in his answer. I have no doubt that when the European Court considers whether such a case should be brought before it, it will look carefully at the
  980
  account of this debate, how the matter was raised, precisely what was said, and the Minister's reply. I look forward with interest to the Minister's reply, and to his response to the amendments on compensation.
  8.15 pm
  Mr. Hogg: I begin with an apology for arriving late. I was attending the puppy show of the Blankney foxhounds. I wanted to do so in order to show my support for fox hunting. When I saw the puppies and reflected that, if a Bill on fox hunting is ever passed, they will not live their natural lives, I felt absolute outrage.
  It is entirely right that the House should press the Minister on exactly what is meant in the Bill. My approach is a somewhat narrow one. I begin by asking myself what we are discussing—it is the forfeiture and disposal order. That relates exclusively to the order that will be made by a court on conviction. Therefore, the question that we need to address is what meaning the court will attach to the phrase "other disposal"? The fact that mink farmers might or might not release their animals into the wild is nothing to do with the clause. The only question is what it means for the court.
  The principal forfeiture and destruction order is fairly clear. It is the ability to order the death of the animals. That is not very obviously in the interests of animal welfare. Indeed, hundreds of thousands of mink will no doubt be put down as a result of the Bill if it is enacted. I do not understand how that can be justified in animal welfare terms, but I shall address that matter on Third Reading.
  What does the phrase "other disposal" mean? Clause 1(1) determines that the offence is keeping animals for certain specified purposes. It follows that, if a person is keeping an animal of the kind in question other than for those specified purposes, he or she is not committing an offence. Therefore, the phrase "other disposal" is put there to enable the court to make an order disposing of the animals by entrusting them to a person or groups of persons who can hold them otherwise than in breach of clause 1.
  I suppose that what is being contemplated is that a court might wish to make an order directing that the animals be held by a zoo, or that somebody might apply for the animals to be entrusted to them to hold them as pets, and in those circumstances an offence would not be committed. Or, as my hon. Friend the Member for Cotswold (Mr. Clifton-Brown) said, they might be exported to some country outside the United Kingdom. Those are theoretical options.
  We are entitled to say to the Minister that we want to know what is envisaged by the phrase "other disposal". There is a theoretical justification for giving courts such latitude. It may well be that it is sensible to give the animals to a zoo, but it would be helpful for us to be told what is contemplated by the phrase "other disposal". At the moment, other than exporting the animals, giving them away as pets, entrusting them to a zoo or using them for animal experimentation—another possibility on which I should like to hear the Minister—it is difficult to see what is the scope of the phrase, so let us have some guidance.
  Mr. Clifton-Brown: My right hon. and learned Friend has thought of another possibility—that the animals might

  981
  be given away as pets. Given what I have said about their viciousness, would not a court be acting somewhat irresponsibly if it were to consider that, because mink are wholly unsuitable for that purpose?
  Mr. Hogg: I agree with my hon. Friend, but the Bill does not preclude that happening. The Bill is thoroughly bad and I shall say so on Third Reading, but if we are to have it, it is difficult to see why anything other than a destruction order is available to the court. The phrase "other disposal" admits of too much uncertainty and does not give sufficient clarity to the courts. I hope that the amendments will be accepted and that the phrase will be removed. I doubt that it has an effective purpose and I suspect that it produces a lack of clarity, which we would regret.
  My hon. Friend the Member for Basingstoke (Mr. Hunter) referred to the dangers of the escape of such animals into the wild. As anyone who knows anything about the countryside knows full well, that is a serious point. If the court makes an order for "other disposal"—not a destruction order but another disposal order—that increases the prospect of the animals escaping into the wild. If, for example, the court makes an order enabling a third party to keep the animals otherwise than for the purposes in clause 1, which is perfectly lawful, who is to say that the animals will be safely contained in their new home? They might escape. Or if, as my hon. Friend the Member for Cotswold said, the order is for export elsewhere, the animals might do a bunk on route, so we will find ourselves faced with escaped animals.
  If I am honest, I am bound to say that this is an odious little Bill. It is political correctness run mad, and I hope that the other place kicks it out. Despite its being an odious little Bill, we must give it serious consideration because it is before the House, but the points made by my hon. Friends on the amendment are sound.
  Mr. Clifton-Brown: Would my right hon. and learned Friend, who is much more qualified than I am in this respect, care to comment on the last point that I made in my speech—that we need to pass clear legislation in the House, otherwise the challenge in the European Court of Human Rights will be all the greater?
  Mr. Hogg: My hon. Friend has a point, but I am rather surprised that the Bill is compatible with the European convention on human rights. I observe that there is a declaration of compatibility, but the Parliamentary Secretary will know full well that article 1 of the first protocol—
  Mr. Deputy Speaker: Order. We are considering the amendments to the Bill, not the Bill in its entirety. The right hon. and learned Gentleman is now dealing with the merits of the Bill.
  Mr. Hogg: I was responding to the question asked by my hon. Friend the Member for Cotswold.
  Mr. Deputy Speaker: I should have stopped the hon. Member for Cotswold (Mr. Clifton-Brown) then.
  Mr. Hogg: I should not have given way to my hon. Friend, but it was an enticing question.
  982
  I can understand the theoretical purpose for the other disposal order. There may be a theoretical cause for it. The Minister must amplify the theoretical cause with illustrations. Giving the animals to a zoo, transporting them abroad or allowing people to hold them as pets in circumstances not in breach of clause 1(1) are theoretical possibilities, but they are pretty bad ones. In truth, the only appropriate order is a destruction order. If I have the good fortune to catch your eye, Mr. Deputy Speaker, I shall speak on the matter on Third Reading, but I am bound to say that this is a pretty awful Bill.
  Mr. Morley: The debate was not entirely illuminating. The provisions are simple, and the answers to some of the questions are straightforward. The intention is to give the courts the discretion to deal with the disposal of animals, depending on the circumstances of each case.
  Most hon. Members have focused on mink, and they are right that humane destruction would be the most appropriate way of dealing with mink in the circumstances that we have considered. In answer to the hon. Member for North Shropshire (Mr. Paterson), any destruction would be carried out in accordance with current regulations, which already govern the humane destruction of mink. There will be no change to that.
  The hon. Member for North Wiltshire (Mr. Gray) was a little confused. We are considering the time when the Bill is in force, and people who deliberately break the law by keeping animals to farm their fur. We are not discussing existing fur farmers, who have a period in which to wind down their business, and will carry on in the usual way under current regulations, which safeguard the welfare of mink.
  The only realistic option for mink is probably humane destruction, but other species may be caught by the provisions, and other options may exist for them. It is therefore appropriate to give the courts some discretion to deal with each case on its merits. They will be advised by Ministry officials from the state veterinary service or the Farming and Rural Conservation Agency about the most suitable option. Some organisations or groups might wish to take the animals.
  Hon. Members asked about chinchilla, which could possibly be farmed for fur. Chinchilla can make suitable pets. Their case would depend on the number of animals and the availability of disposal. It is appropriate that the courts should be able to exercise their discretion so that the individual merits of each case are considered.
  I remind Conservative Members that one of the problems with the Dangerous Dogs Act 1989, which the previous Administration introduced, was that it was too narrow. That Act gave the courts no discretion, or any way of taking individual circumstances into account. Destruction of the animal was the only option available under the Dangerous Dogs Act. We all know the problems that that caused, and why the legislation had to be amended to include the sort of discretion for which the Bill provides. Under the Bill, courts can consider each case on its merits and determine the most appropriate course of action.

  983
  It would not be appropriate to export mink that were seized under a forfeiture order. Humane destruction is clearly the most appropriate option in such circumstances.
  Mr. Hogg: The Under-Secretary used the words, "would not be appropriate". Does he claim that such action would be unlawful?
  Mr. Morley: As the right hon. and learned Gentleman knows, that is a matter for the courts. However, I cannot envisage circumstances in which the courts would deem the export of live mink to be appropriate disposal. That does not seem rational, and I do not believe that the courts would consider that option.
  Mr. Clifton-Brown: The Under-Secretary was courteous in Committee, and he has been courteous now. I cited Committee Hansard, because the Under-Secretary said that it was perfectly legal to sell the breeding animals in the winding-down period. No regulations would prevent their export to Europe in that time. Why, therefore, should it not be legal for the court to make a forfeiture order and have the animals exported?
  Mr. Morley: There is a clear difference. It is theoretically legal to export to Europe now—I cannot envisage circumstances in which fur farmers would want to do that—because until the Bill is enacted, there is a winding-down period for existing fur farmers. In that period, the farmers will continue with a lawful business, and in such a business there are no restraints on trade. If fur farmers chose to sell animals abroad in that winding-down period, they would be free to do that. When the Bill becomes law, the keeping of animals for fur will be illegal and it would be illogical to allow the animals to be exported. It would undermine the whole point and thrust of the legislation.
  8.30 pm
  Mr. Gray: Let us imagine a fur farm in Northumberland with a forfeiture order against it and, across the border in Scotland, the Scottish Parliament have decided not to make the practice illegal. Surely it would be sensible for the English court to decide that the animals should be exported 10 miles up the road to Scotland where they could still be legally farmed.
  Mr. Morley: No, it would not be sensible, not least because the Scottish Parliament is introducing parallel legislation to deal with the matter. I understand some of the points made by the hon. Member for North-East Cambridgeshire (Mr. Moss), and one or two were sensible. However, some of the points made in the debate drifted into realms of hypothetical fantasy. I want to reassure the hon. Gentleman that, because of the fair points that have been made about the nature of mink, the only option for the court would be humane destruction. However, we should give the court some flexibility to deal with each case on individual merits.
  Mr. Moss: The Minister has mentioned only one other species so far—the chinchilla. It was also the only other species he came up with in Committee.
  Mr. Morley: Hamsters.
  Mr. Moss: The Minister is right—he also mentioned hamsters in Committee, but I have not come across
  984
  anyone raising hamsters for their fur and nor am 1 likely to do so. I am surprised that the Minister has dragged out the hamster illustration again. Let us be honest about the Bill and admit that it is aimed directly at mink farming.
  Mr. Hogg: My hon. Friend seeks other examples, but he will know that the Prime Minister has created many peers who wear robes trimmed with ermine. I suggest that one other animal likely to be affected by the Bill—
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order.
  Mr. Hogg: The animal used for ermine—
  Mr. Deputy Speaker: Order. The right hon. and learned Gentleman will sit down when I am on my feet and will not ignore the Chair. He has already been spoken to by the Chair for roaming outside the scope of the amendment, and his latest attempt is a gross abuse.
  Mr. Moss: We rule out the hamster illustration, so the only other example cited by the Minister is the chinchilla. As far as I know, there are no fur farms for ermine in this country. The Bill is aimed directly at mink and, with the Minister's assurance that his advisers will always recommend destruction of the mink in the right circumstances, I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.

Clause 5

  COMPENSATION FOR EXISTING BUSINESSES
  Mr. Moss: I beg to move amendment No. 5, in page 3, line 14, leave out from "authority" to "by" in line 15 and insert "shall".
  Mr. Deputy Speaker: With this it will be convenient to discuss the following amendments: No. 6, in page 3, line 20, leave out from beginning to "in" and insert "The scheme shall".
  No. 7, in page 3, line 20, after "particular", insert—
  'set up an independent advisory body in accordance with Schedule (Independent Advisory Body) to advise the appropriate authority on all aspects of the scheme.
  (2A) The independent advisory body shall in particular—'.
  No. 8, in page 3, line 29, after "claims", insert—
  '(2B) In determining its recommendations on compensation to the appropriate authority the independent advisory body shall include provision for

  (a) the payment of reasonable professional fees for advice for persons making claims,

  (b) the payment of interest to be calculated on a compound basis on the total of agreed final settlement payments, or as may be determined by arbitration, payable from the date of the settlement or of any other time limit imposed for compensation payments, whichever is the earlier,

  (c) the payment on account where requested by the claimant of 60 per cent. of the amount of compensation agreed between the claimant and the appropriate authority, or in any other case of the amount of compensation that the appropriate authority estimates the claimant is entitled to under the scheme, within three months of the submission

  985
  of the scheme, or on the expiry of any time limit imposed for the payment of compensation, whichever is earlier,

  (d) consideration to be given for a payment to be made in appropriate cases to meet the costs of clearing the land in question of buildings or other fixed equipment utilised by the business,

  (e) the payment of expenses incurred by the claimant as a result of the coming into force of section I including forced sales, premature termination of contracts, and any other reasonable disturbance costs.'.

  No. 10, in page 3, line 39, at end insert—
  '(4A) The agreement of the appropriate authority to refer a dispute as to a person's entitlement to arbitration under subsection (4) shall not be unreasonably withheld.'.
  No. 11, in clause 7, page 4, line 9, leave out from "force" to end of line 10 and insert—
  'on the day on which this Act is passed.'.
  New schedule 1—Independent Advisory Body—

  1. The independent advisory body shall be made up of no less than three and no more than seven members.

  2. The members shall possess such professional qualifications as the appropriate authority shall specify in order to provide an independent and comprehensive assessment of all those criteria necessary to arrive at an independent and fair market valuation of the businesses affected by the coming into force of section 1.

  3. The independent advisory body shall be set up no later than the day after the day on which this Act is passed.

  4. The independent advisory body shall be free to seek guidance on valuations from professional and political associations involved with fur farming in any country of the European Union.

  5. The independent advisory body shall be recompensed for reasonable expenses incurred in the course of its duties.

  6. The independent advisory body shall report back to the appropriate authority no later than 6 months prior to the date on which Sections 1 to 4 shall come into force.'.

  Mr. Moss: Amendments Nos. 5, 6, 7, 8 and 10 relate to clause 5, which deals with compensation, and amendment No. 11 relates to clause 7. Clause 5 is, after clause 1 which creates the offence, the most critical clause in the Bill because it addresses the issue of compensation. The private Member's Bill showed little sign of any real compensation, but this Bill has beefed it up. We welcome the fact that the Government have moved to address the issue of compensation more meaningfully.
  As the Minister has said on many occasions, clause 5 is an enabling clause. Amendment No. 5 would change the word "may" to "shall" because we want to be sure that the Government are totally committed to introducing a compensation scheme. They have promised it and they have given assurances, but it is not in the Bill in a strong enough way to give us the reassurance that we seek on behalf of the 11 fur farmers who are looking for sensible, fair and proper compensation.
  Amendment No. 6 follows on from amendment No. 5. It would insert the words, "The scheme shall". It would require the appropriate authority—which of course is the Minister—to set up a scheme.
  Mr. Hogg: I am trying to relate my hon. Friend's amendments to the clause. My understanding of the practical effect of the amendment is that it would require compensation in Wales, as the Bill already requires a scheme in England, but not in Wales. Am I right?
  Mr. Moss: That certainly was not the intention of the amendment and I am puzzled by my right hon. and learned Friend's interpretation. According to the present wording of the Bill in subsection (1),
  The appropriate authority may (and in the case of the Minister of Agriculture, Fisheries and Food, shall) by order make a scheme for the making of payments by that authority.
  Mr. David Heath: My interpretation of the amendment is exactly the same as that of the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg). The appropriate authority can mean only two bodies: either the National Assembly for Wales or the Ministry of Agriculture, Fisheries and Food. The Ministry of Agriculture, Fisheries and Food is required to introduce a scheme in England, so the amendments can affect only the position in Wales.
  Mr. Moss: I am slightly puzzled by that conclusion. The amendment is an attempt to impose on the Minister, who is the appropriate authority in England, and the appropriate Welsh Minister, a requirement to introduce the scheme. Amendment No. 6 provides that that scheme shall—not may—fulfil certain functions.
  Amendment No. 7 would require the setting up of an independent advisory body in accordance with new schedule 1 to advise the appropriate authority on all aspects of the scheme. It then places further requirements on that independent advisory body.
  Amendments Nos. 6 and 7 are crucial in that they would establish a group of independent experts to investigate and assess the compensation requirements of fur farmers who were caught by the legislation. It would make the independent aspect of the compensation scheme completely transparent and would honour the commitment that the Minister repeatedly gave in Committee.
  During our third sitting, the Minister promised:
  Independent valuations will be conducted not by Ministry staff, but by independent valuers who will talk with farmers about capital and income streams before reporting back to the Ministry. Those professionals can be sent out to farms as quickly as possible, and almost immediately after Royal Assent.—[Official Report, Standing Committee E, 6 June 2000; c. 83.]
  We have taken the Minister's words at face value. Indeed, we interpreted them as a commitment or even a promise. The new schedule, which we will come to later, sets out the role and composition of the advisory body. It refers to issues identical to those raised by the Minister—namely, the need to use professionals, and when the advisers should go out to talk to the fur farmers about compensation. We are talking about that taking place as soon as the Bill receives Royal Assent.
  Under the Government's proposals, the scheme to be set up by the appropriate authority will have responsibility for implementing clause 5(2). We believe that the Bill therefore gives great control to the Minister and the Ministry. Clause 5(2)(a) requires the authority to specify
  the descriptions of losses and businesses to receive payment … and the basis of valuation for determining losses.
  Clause 5(2)(b) requires it to specify
  the amounts of the payments to be made and the basis on which they are to be calculated.
  Clause 5(2)(c) requires the authority to
  provide for the procedure to be followed in respect of claims.

  987
  Amendment No. 7 would give that role to the independent advisory body. It tasks that body with advising the Minister
  on all aspects of the scheme,
  and the emphasis is on the words "all aspects". Any independent assessment of a compensation scheme should start from the premise of fairness and proper value. Appointing independent assessors would rescue the Minister from any accusations of organising a stitch-up or of having preconceived notions of valuation that are circumscribed by Treasury-driven financial limits.
  The phrase "all aspects" means that all the facets, components, considerations and calculations that must be taken into account when arriving at a fair and accurate valuation shall be part of the assessment. To achieve that, the independent body must be made up of people with a range of professional skills—a point that the Minister has already conceded in Committee.
  The independent advisory body must be free to start from basics. There should be a clean sheet of paper, with no preconceived notions as to what is ruled in or out. A lengthy discussion took place in Committee about the financial guidelines set out in the explanatory notes to the Bill. Paragraph 26 of those notes is headed "Financial Effects of the Bill", and states:
  It is estimated that the cost of compensation under the Bill for the … 13 mink farms could, in respect of assets, be up to £400,000 and perhaps four times that amount if income were to be compensated.
  We pressed the Minister about the upper limit of £1.6 million. Time and again, we asked if it was a predetermined upper limit that effectively set a ceiling on the negotiations on the value of fur farming business. The Minister was helpful in confirming that the figure was not carved in stone:
  We will consider carefully whether the figure might have to be varied … We feel that our figure is broadly right, but if some adjustment is required, we shall consider it carefully following the valuations.
  Finally, he said:
  The valuers certainly will not be instructed to draw up a scheme within the maximum of £1.6 million.—[Official Report, Standing Committee E, 6 June 2000; c. 83-5.]
  We feel that the best way to secure that clearly stated commitment from the Minister is to give powers for determining the compensation scheme to an independent body, with no strings attached.
  Another vexed issue was whether income would be considered in a compensation scheme. That question was put to the Minister in Committee by my hon. Friend the Member for Cotswold (Mr. Clifton-Brown). The Minister replied:
  I can assure the hon. Gentleman that the provision of compensation for income will certainly be considered in the compensation scheme. The Bill makes provision for that.
  A little later, the Minister stated:
  I have already said that there will be an independent valuation of the businesses, including their income.—[Official Report, Standing Committee E, 6 June 2000; c. 62–5.]
  That clear steer from the Minister would help any independent valuers tasked with working up a scheme. It would be an integral part of their deliberations to consider the importance of income under clause 5(2)(a), which requires them to
  specify … the basis of valuation for determining losses.
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  Amendment No. 8 would give a specific responsibility to the independent advisory body to take certain stated considerations into account in determining its recommendations on compensation to the Minister. Such considerations can be summarised as follows—provision for reasonable professional fees, the payment of interest on outstanding settlement payments, a payment on account of 60 per cent. of the agreed amount of compensation, a payment for the cost of clearing land of buildings and fixed equipment, and payment of reasonable expenses in winding up the fur farming businesses.
  8.45 pm
  Let us look first at proposed subsection (2B)(a), which deals with the payment of legal fees for the advice that fur farmers will need. A similar amendment was tabled when the private Member's Bill promoted by the hon. Member for Liverpool, Garston (Maria Eagle) was considered in Committee. It was rejected because it was too loosely worded, referring as it did to "advisers" in the plural. Those in favour of the Bill argued that that placed no limit on the number of people whom fur farmers could consult, thus creating the need for a blank cheque. Amendment No. 8 is specific, in that it refers to the payment of reasonable professional fees for advice—in the singular. That would, we hope, rule out payments to a long list of advisers.
  To my knowledge, no other Government have introduced legislation to ban an entire sector of farming. That places even greater emphasis on the unbiased and independent advice that the fur farming community will require.
  It has been standard practice for many years that claimants under the land compensation code are entitled to have their professional advisers' reasonable fees paid for by the acquiring authority. The Bill will impose a compulsory ban on fur farming, which we argue is similar to a compulsory purchase order under the land compensation code. The effect would be pretty much the same in each case—the state uses compulsory purchase powers to confiscate an individual's property.
  Fur farming is a very specialised form of farming. We believe that it is essential for the farmers involved to have access to good professional advice, in the consultation period and during negotiations, on the level of compensation to which they feel that they are entitled. The amendment would help to ensure not only that such professional advice was available but that the fees for it would be allowable in reaching a figure for compensation.
  Proposed subsection (2B)(d) in amendment No. 8 would provide for the cost of land clearance to be included in any appropriate compensation scheme. In Committee, the Government gave an assurance that, as a general principle, they would consider the cost of demolition in relation to a claim in particular cases. However, they were adamant that such consideration would be given only on a case-by-case basis and on a case's individual merits, rather than blanket coverage. We accept that, and believe that the amendment conforms to that requirement.
  Because the Government are proposing a unique measure, and because fur farming is so specialised, there is very little professional opinion available on what effect the ban will have on the future use of these specialised buildings and the equipment that is associated with

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  fur farming businesses. An example was given in Committee—a farmer in Northumberland had turned some of his sheds over to the growing of strawberries. Other people commented that he had gone out of business, for whatever reason. There are limited other uses to which the buildings can be put. It is important that the cost of demolishing and clearing the land be included in any scheme.
  We know that land clearance, especially if someone wants to return the site to a greenfield site that can be farmed in more conventional ways, can be extremely expensive. Figures have been quoted of about £100,000 for a substantial farm of, say, 600 breeding females. Pro rata, that would come out at £17,000 per hundred breeding females. Those are substantial sums in anyone's book, and we feel that it would not be unreasonable that they should be included in the calculations in the compensation scheme.
  Proposed subsection (2B)(e) would provide for compensation to cover costs associated with the winding up of a fur farming business. As a general rule, claimants in any scheme of compensation should mitigate their losses wherever possible, but there will inevitably be costs associated with winding up businesses as a result of the coming into force of the offence in clause 1. There may have to be forced sales of capital equipment, land and the property that goes with it. If a farmer was leasing land, there might be costs for early termination of the lease. There is always a cost when people wish to terminate a lease in advance of the appropriate date. Contracts may have been entered into with subcontractors to do work on the farm; they, too, may require compensation.
  Proposed subsection (2B)(b) in amendment No. 8 would allow for interest to be claimed on any outstanding compensation and to be payable in the period from the date of the final settlement to that of payment. We hope that whatever scheme the Minister puts in place as a result of the advice that he receives from the independent advisory body will be regarded by all parties as fair and honourable, and that it will not take a great deal of time to reach agreements on the level of compensation. However, in the real world, things rarely go so smoothly.
  Negotiation and settlement of claims could take considerably longer than a few months. If negotiations turn out to be lengthy because there are disputes about the scale and the amount of compensation, that may involve the matter going to arbitration, as we know from other parts of the Bill. It may well go to the Lands Tribunal, under clause 5(5). If it does, settlement could take years rather than months. In those circumstances, it would be appropriate for compound interest to be payable on the amount that is finally agreed. The advice to the Government from their working party on compulsory acquisition was that such interest was payable.
  Proposed subsection (2B)(c) relates to what we call payment on account. It would allow for interim compensation payments to be paid when the final payment was unreasonably delayed. Since 1973, claimants under the land compensation code have been entitled to request advance payment of 90 per cent. of either the agreed compensation or, more usually, the acquiring authority's initial estimate of their entitlement.
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  As I have said, it can take months or years to reach a final settlement in practice, especially if the Lands Tribunal route is entered into.
  The amendment sets a lower figure than the 90 per cent. under the code; 60 per cent. is fair and reasonable. That would extend to the fur farming industry rights similar to those applicable to land compensation. It would be unreasonable of the Government to reject that proposal. It is in their interest to accept the amendment, because it is likely to enable fur farmers sooner to establish other businesses and sources of income.
  Amendment No. 10 provides
  That the agreement of the appropriate authority to refer a dispute as to a person's entitlement to arbitration under subsection (4) shall not be unreasonably withheld.
  In Committee, the Minister agreed that the Lands Tribunal was a poor long stop for settling disputes. Indeed, the process is notoriously slow and expensive and invariably extremely unfriendly towards claimants.
  The inclusion of an arbitration procedure under the Bill is welcome. In the absence of agreement, we would support the selection of an arbitrator by the president of the Royal Institution of Chartered Surveyors. However, under the measure, there is a risk that the Minister could refuse to go to arbitration; or he could wait until the full nine months had elapsed before making his offer and force the claimant to settle at that late hour or face the unattractive option of taking the case to the Lands Tribunal. That would give the Minister unfair leverage in the negotiations. We should like him to accept our amendment, because it would give an assurance to all involved that he would not withhold unreasonable agreement to arbitration if the parties had not reached an earlier settlement.
  Amendment No. 11 relates to clause 7. In Committee, the Minister said:
  I take the point that some fur farmers may want to get out of the business as quickly as possible; I understand that point … I want the scheme—
  for compensation—
  to be introduced as quickly as possible in order to assist people.—[Official Report, Standing Committee E, 6 June 2000; c. 81-2.]
  He said that it would take a couple of months to get a draft consultation scheme up and running. There would be a two-month consultation period followed by about a month of internal discussions. In the light of those comments and given the desire of the farmers to get the scheme under way as soon as possible, there is no reason why clause 7(3) should delay the implementation of the compensation clause until two months after the Bill receives Royal Assent.
  New schedule 1 relates to the independent advisory body. The body should comprise no fewer than three and no more than seven members. The numbers are fairly arbitrary; we want a workable number of people—more than seven would be unwieldy and three is probably the minimum. Our proposal offers the Minister plenty of scope to act as he sees fit.
  Paragraph 2 would require members of the body to possess such professional qualifications as the Minister deems appropriate to the job in hand. The RICS should be involved—because of the auctioneers and valuers. An accountant should be included. Someone from the legal side—a solicitor or banister—should be involved;

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  also perhaps a National Farmers Union representative, and perhaps an expert in fur farming from the European Union. After all, there is a huge fur farming industry in the other member countries of the European Union, and some of those have already considered compensation schemes, so their expertise might be helpful.
  9 pm
  Paragraph 3 of the new schedule requires that
  The independent advisory body shall be set up no later than the day after the day on which this Act is passed.
  The Minister has suggested that he wants to get this scheme up and running on the day the Bill receives Royal Assent; we would give him an extra day. If the scheme can be set up before Royal Assent, for earlier consultation, we would welcome that.
  In paragraph 4 of the new schedule we have suggested that the independent advisory body should be free to have discussions with people involved in fur farming in the rest of the European Union. Although members of the advisory body may not seek that guidance and advice or help, we feel that there should be such a provision because the scale of the fur farming operation elsewhere in the European Union is immense compared with our own. We have 11 farmers; I believe that there are about 8,000 fur farmers in the rest of the EU, so we would argue that the expertise in that business is far greater than in this country, and it would be very helpful if the independent advisory body were allowed, within its articles of association, if I may call them that, to consult in that way.
  Finally, paragraph 6 of the new schedule says that
  The … advisory body shall report back
  to the Minister
  no later than 6 months prior to the date on which Sections 1 to 4 shall come into force.
  Clause 7 speaks of
  no day before 1st January 2003.
  We would say that this advice from the advisory body needs to be on the Minister's desk six months before whatever date he has decided the Bill will come into force. That, on the face of the Bill, is not before 1 January; so if that were to be the date in question, we would be talking about six months before then—the middle of 2002.
  I have explained the long list of amendments dealing with compensation. As I said in my opening remarks, the provisions relating to compensation are the most critical part of the Bill as it stands. Only a small number of people are involved, but their businesses are extremely important to them. They are, in the present context, in the main lucrative businesses, and it is important that the processes that deal with compensation should be independent and transparent, and that there should be recourse to all the professional help that is available in order to arrive at fair, proper and adequate compensation.
  Mr. Hogg: This is a terribly important group of amendments. I support not the exact wording of the amendments that my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss) has spoken to, for reasons that I shall explain, but their underlying purpose.
  First, let me say where my hon. Friend and I are not at one, because I think that my understanding of the group of amendments is slightly different from his. My
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  understanding of the Bill as it is currently formulated is that the Minister of Agriculture, Fisheries and Food is obliged to bring forward a scheme for England but in the case of Wales it is a matter of discretion. Therefore the effect of amendment No. 5 impacts only on the Welsh dimension; it makes it mandatory for Wales to bring forward a scheme. In principle, that of course is right, although I would have to accept the principles of devolution. It may well be right for the Welsh Assembly to determine whether there should be a compensation scheme within Wales. None the less, in principle, I feel sure that there should be a compensation scheme.
  The Bill, as it is formulated, places a duty on the Minister to produce a scheme. The Bill is defective in that there is no requirement—I emphasise that word—as to what should be in the scheme. There is a permissive power to include within it a range of heads of compensation, which are set out in clause 5(2)(a)(b) and (c). They may be included, but do not have to be.
  The advantage of the approach of my hon. Friend the Member for North-East Cambridgeshire is that it provides for an independent body to make a recommendation, which has to provide for various forms of compensation. Why is it important that there should be an independent body of the sort recommended by my hon. Friend? In part, the argument is as he has stated it, namely, that we need transparency and independence, because—I now speak with some experience of the matter, if you will forgive my saying so, Mr. Deputy Speaker—all Government Departments are mean. They have to be mean because they are acting within a budget. One can be certain that if the Minister is the sole person or body to set up the compensation scheme, as the Bill provides, it will be done extremely meanly because of the budgetary constraints under which the Department is operating.
  Furthermore, a challenge can be made under the Bill only within the framework of the scheme that the Minister has produced. The Minister is not only responsible for the scheme, he is the payer. A successful challenge would have to be within the scope of the scheme that the Minister has produced and that constrains the right of appeal in a way that is wrong.
  Another argument is that the European convention on human rights will be in operation from 2 October. One of the consequences of article 1 of the first protocol, and of other articles, is the obligation to pay compensation. Governments may well be moving towards compensation requirements because of that convention and its impact on the compensation duties of Departments.
  I point out to the Minister that, as my hon. Friend said, if there is a duty under the European convention to pay compensation, it is pretty certain that the European Court of Human Rights will require that the criteria for compensation should be set out and determined either by statute on the face of the Bill or by some independent body. Otherwise, to return to the argument that I was making a few moments ago, the payer will set up the scheme and will limit the ability of the claimant to challenge it. I very much doubt whether that will be held to be consistent with the convention. Therefore, my hon. Friend is trying to give the Government some reinforcement, although I do not suppose that the Minister will welcome it.
  I deplore the measure. It is an odious little Bill. That said, however, we must deal with it as it is. In its present form I suspect that it is not compatible with the European

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  convention because the compensation provisions do not appear in it in an explicit form and there is no independent body to set out the criteria. Therefore, there is a real danger of a declaration of incompatibility down the track, or an application to Strasbourg.
  My hon. Friend the Member for North-East Cambridgeshire is giving the Parliamentary Secretary an opportunity to reinforce the Bill. I told my hon. Friend that I welcomed the purpose of his amendment, but one or two adjustments need to be made if its principle is to be accepted. Neither the scheme in the Bill nor the scheme in my hon. Friend's amendment make a requirement—I underline that word—to pay compensation for loss of profit. It may be addressed in the scheme proposed by the Minister, but it does not have to be.
  Why on earth are we not providing for loss of profit to be a mandatory element in the compensation scheme? My hon. Friend's approach, if adopted, would need adjustment in another place to make the provision of a loss-of-profit element mandatory. I also wish to draw attention to the fact that compensation is simply for the value of the animals. The animals themselves have a value, which is different from the loss of profit, although they overlap. The Parliamentary Secretary looks pensive, but I assure him that that is the case. There are two elements: the value of the beast and the damage to the business. When people go out and buy a lot of beasts, they incur costs in acquiring them. Those beasts have a value. Down the track, however, there is a continuing profit for the business. Obviously there is an overlap, but those heads of loss are different.
  The Bill or my Friend's scheme, when adjusted, should make provision for mandatory compensation to be paid for the loss of the beasts themselves. My hon. Friend has enabled the House to raise the question of compensation. I welcome his approach, which would impose yet more mandatory duties on the Government. I also welcome it because my hon. Friend suggests that the scheme should include various heads of loss that are not currently included. Personally, I think that he has not gone quite far enough and that the matter should be examined further in another place. However, I have no doubt that he has moved in the correct direction and I support the purpose of his amendment even though, if he will forgive me, I have one or two misgivings about some of its language.
  Mr. Hunter: I shall be brief, as the points relevant to the amendments have been expressed clearly by my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss) and my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg).
  I wish to pick up one aspect of what my right hon. and learned Friend has just said about the European dimension, which is so relevant to the compensation issue. The Minister will correct me if I am wrong or mistaken, but I have received briefing material which states that the European Commission has advised member states not to proceed with legislation on a national basis prior to the introduction of a directive which is currently being worked on. I have been given a facsimile of a document that purports to be to that effect.
  No doubt the Minister will be able to advise me whether that is right or wrong. He will acknowledge that the European Union is beginning to move on that front,
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  that growing attention is being paid to the issue of fur farming and that, in the course of time, movement is likely. In advancing down the way of national legislation on compensation, I am concerned that, while one or two cases of compensation are perhaps fully sorted out and others are in the pipeline, an entirely different regime will be imposed by the European Union.
  I should like the Minister to contemplate that scenario, which is not impossible, and could arise and present enormous difficulties. That possible scenario makes it all the more advantageous and desirable that an advisory body, composed of independent advisers, is created.
  9.15 pm
  I do not wish to go over at length the points that my hon. Friends have made, but I emphasise to the Minister that, apart from clause 1, which establishes the offence, this is clearly the most critical clause. The Government have moved forward from the position in last year's private Member's Bill. I am grateful for that and readily acknowledge it, but it is imperative that the amendment to substitute "shall" for "may" be included in the Bill.
  I have listened carefully to the Minister on numerous occasions on the subject. I think that that total commitment is still not there. The provision is not strong enough. Reassurances are needed. The amendments go significantly towards filling that gap. I hope that the Minister will seriously take them on board.
  Mr. Paterson: This is the most important subject of the Bill. It is the first time I know of that a Government have wilfully closed a legitimate business activity which is flourishing in the rest of Europe. For example, fur farming accounts for perhaps 4 per cent. of Danish gross domestic product. I pick up on the comments by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg). It is important that the Bill has clear provision on a fair and comprehensive compensation scheme, or the Government risk running into fearfully expensive legal actions in Europe.
  I pray in aid the National Farmers Union, which as we all know is a non-political organisation. It has made it clear in letters on the subject, including one that I received in January that
  Should this legislation proceed it is therefore imperative that the individuals concerned are treated fairly.—[interruption.]
  The hon. Member for Liverpool, Garston (Maria Eagle), who promoted the private Member's Bill, is laughing. There are people who have built up businesses for 40 years. It is their life's work. There is a business in the west country that employs 40 people. I do not think that it is a laughing matter. Because she finds the activity distasteful and hides behind the idea that it is publicly immoral, she wants to close it down. The one thing that we must do—
  Mr. Deputy Speaker: Order. The hon. Gentleman is already starting to stray. I should like to bring him back to the terms of the amendment, which is about compensation.
  Mr. Paterson: Absolutely, Mr. Deputy Speaker. What I am objecting to is that the hon. Lady is laughing at the discussion on compensation.
  Mr. Deputy Speaker: Order. There is no need to repeat the point, which I have just ruled out of order.
  Mr. Paterson: Moving on to the Europeans, who will pick up the matter if the Bill is not fair? I have talked to Wim Verhagen, chairman of the European Fur Breeders Association, who is adamant that it will take the measure to the European courts if there is no fairness in this country. I pray in aid Helge Olsen, manager of the European Fur Breeders Association, who made it clear that it would be extremely damaging for the industry in Europe if the measure went ahead. They are concerned about compensation in this country.
  The only reference to sums of money is tucked away on page five of the explanatory notes. Under the heading "Financial effects of the Bill", paragraph 26 states:
  It is estimated that the cost of compensation under the Bill for the current thirteen mink farms could, in respect of assets, be up to £400,000 and perhaps four times that amount if income were to be compensated.
  That figure laughably underestimates the true cost of the measure. From a few brief conversations that I have had, it is clear that that would not pay to close even one farm. A farm in the west country has had a quote for £2.6 million on the plant and assets alone. It has had an independent assessor in. The estimated loss of income is £1 million a year. There is the question of returning the site to a green field because the buildings will incur rates. Those buildings will have to be demolished, a point that the Minister might like to pick up. The cost of demolishing the buildings on just one farm would be £100,000.
  Therefore, I estimate that that farmer alone would look for at least £3 million to £4 million, which is a large sum. The man has built up the business over 30 to 40 years and invested not only in its physical assets. Fur farmers have invested substantially, although investment has come to a halt in recent years because the Government have said that they would not compensate farmers for that.
  As my right hon. and learned Friend the Member for Sleaford and North Hykeham pointed out, the stock is valuable. Farmers have bred the animals, created a brand and developed good will. The businesses have an international reputation. The Bill does not refer clearly to income and there are also the issues of redundancies, wind-down costs and loss making as wind-down takes place. I have already touched on rates and demolition costs, but there is also interest and fees, which we discussed in Committee at some length. They constitute substantial costs and the figure in the explanatory notes cannot possibly be anywhere near accurate,
  As a further guide to the figures' inaccuracy—
  Mr. Deputy Speaker: Order. I have tried to help the hon. Gentleman, but this is not the appropriate moment for a general discussion about compensation. The debate is about the specific terms of the amendments. I would feel a little more comfortable if he directed his remarks towards the amendments.
  Mr. Paterson: Thank you, Mr. Deputy Speaker. The amendments would provide much better terms of compensation than are currently in the Bill. That is the most important point that we are discussing. Will the Bill offer a satisfactory compensation scheme? My answer is no. Would the amendments, as tabled by my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss), improve it? The answer is yes.
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  I have cited one example that shows that the Bill is simply not adequate as it stands. It will not cover all the costs that I have mentioned. A farm in Austria is the only one in Europe that has been bought out and it cost 4.7 million Austrian schillings to do that. The cost was the equivalent to about £400 for each breeding female. The Bill does not refer to anything like that sum. It does not provide a mandatory compensation scheme.
  Mr. Deputy Speaker: Order. I do not think that the hon. Gentleman has taken on board my advice. He should consider not the general amount of compensation, but the mechanisms for compensation that are at the heart of the amendments. He must direct his remarks to the scheme that is proposed in the amendments.
  Mr. Paterson: I was saying, Mr. Deputy Speaker, that the Bill does not provide for an adequate scheme. As it stands, it would not come up with anything like the figures that have been proved necessary elsewhere. The figure in the explanatory notes is simply not adequate.
  Mr. Deputy Speaker: Order. The hon. Gentleman must take on board my advice. We debate within the Standing Orders of the House and he must follow certain rules. He cannot go outside those rules in the way that he is seeking to do. The amendments have a narrow scope and he must focus on that.
  Mr. Paterson: Amendment No. 8 would provide for an independent advisory body. That would provide a more viable basis for compensation. It would touch on some of the aspects that I have mentioned. The proposed subsections (a) and (b) in the amendment touch on professional fees and interest payments, and it also refers to buildings. Those are the most important issues for the farmers who have built up their businesses over the years. They need a thoroughly fair and transparent compensation scheme. The amendment would provide for that.
  The only figure that is currently referred to is in the explanatory notes. The Treasury will run rings round the Minister. The compensation offered is not satisfactory.
  Mr. Clifton-Brown: Some of the provisions were discussed in Committee, but the replies that we received, although courteous, were not satisfactory in substance. Our concerns therefore need airing again on Report.
  On amendment No. 5, as my right hon. and hon. Friends have said, it is essential that in clause 5 the word "may" should be replaced by "shall", otherwise there is no obligation on the appropriate authority to produce a compensation scheme. That would be appalling. I see no reason why the Government should not accept the amendment.
  Maria Eagle: I am grateful to the hon. Gentleman. The right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) first made the point, but perhaps I can try again to explain. Clause 5(1) already provides for the Ministry of Agriculture, Fisheries and Food in England to make a scheme, through the use of the word "shall". In Wales, that would be a matter for the National Assembly, but there are at present no fur farms in Wales for which a scheme would have to be made. Although one can see the point of the amendment, it is defective. Does the hon. Gentleman not accept that?
  Mr. Clifton-Brown: I entirely accept what the hon. Lady says. The amendment is defective. That shows how

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  carefully one needs to read an amendment before appending one's name to it. Nevertheless, the spirit of what we tried to achieve through the amendments is clear. If we had the access to the parliamentary draftsmen that the Minister has, I am sure that such an elementary mistake would not have been made.
  Before I am led too far down the path of temptation and ruled out of order, Mr. Deputy Speaker, I shall move quickly on to amendment No. 8. Many aspects of the amendment were covered in Committee, but there are one or two that I shall discuss. On the aspects that we raised in Committee, the Minister said that they would be subject to consultation; and that the Bill would provide for them if the Government considered it necessary; but that the Government would give no guarantee that the Bill would provide for them.
  That is an unsatisfactory way in which to proceed. As I said on the previous group of amendments, we must be clear in the legislation that we pass. People's livelihoods are to be taken away. It does not matter whether one approves of their livelihood or not. The fact is that we are taking away people's livelihoods and they deserve to be compensated.
  Mr. Hogg: I am grateful to my hon. Friend. Does he agree that it should also be borne in mind that this will be the last time—other than when we come to discuss Lords amendments, if we do—that the House will have an opportunity to discuss the compensation scheme? He will have noticed that the scheme is subject to the negative resolution procedure rather than to the affirmative resolution procedure.
  Mr. Clifton-Brown: My right hon. and learned Friend makes an interesting point, and if time permits, I may get on to the subject of the negative and affirmative resolution procedures.
  Let me return to amendment No. 8. I hope that, as my right hon. and learned Friend said, if the Minister does not accept the amendments this evening or give an undertaking that the Government will move similar amendments in the other place, our noble Friends act accordingly.
  It is a fundamental principle of a compensation scheme that professional fees should be paid. No one would argue with that. In any statutory compensation scheme, it should be possible to claim reasonable professional fees. In many cases of compulsory purchase, interest is also paid.
  As I said in Committee, it seems entirely reasonable that, since the Inland Revenue and Her Majesty's Customs and Excise charge interest on late tax and VAT payments, if the Government delay paying compensation under the Bill, they should also pay interest. Not only is that equitable: it gives the Government an incentive to agree to the compensation and get it paid as soon as possible. If people's livelihoods are being taken away, they deserve to have their compensation paid quickly.
  New subsection (2B)(c) in amendment No. 8 provides for 60 per cent. payment in advance. Again, I declare an interest as one of only two chartered surveyors in the House. I have drawn up such claims in the past. When there are two opposing valuers—as I am sure will be the
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  case here—it is easy to get to the reasonable quantum of a claim quite quickly, although the parties often disagree about the last little bit and may have to go to arbitration.
  9.30 pm
  As the Bill will make statutory provision for compensation once it has been amended properly in the other place, it is wholly reasonable that a large proportion—personally, I think that 60 per cent. is about right—should be paid in advance. That will help with the costs of resettlement and so on. Some of the payments may be taxable, so it will help if some money is paid in advance and some a little later.
  New subsection (2B)(d) in amendment No. 8 concerns clearing land and equipment. I have been involved in agriculture all my life and I know how quickly buildings can become out of date. I have no doubt that the specialist buildings and equipment will be completely useless for anything else, so it is wholly reasonable that compensation should be paid to allow the land to be rendered fit for other purposes. If the buildings are not demolished, they may well be subject to rates, even though the business is not being carried on. In that circumstance, I have no doubt that the owner or lessee of the land would want to demolish them as quickly as possible.
  If the state is forcing people to give up their business, it is right to include the items listed in paragraph (e) in the heads of claim. I have no doubt that expenses will be incurred in cancellation of contracts. There may be long-term contracts and some may even contain penalty clauses in the event of premature termination.
  I suppose that "other reasonable disturbance costs" could include loss of income. The Minister needs to come clean about that. He said:
  Yes, the Bill allows compensation for income. My hon. Friend's Bill specifically ruled that out. During the discussion that we had in that Committee—because, as I said, the Government must pay in the end—
  which is very good news—
  I accepted that there would be an amendment that did not bar the consideration of income.—[Official Report, Standing Committee E, 6 June 2000; c. 62.]
  In other words, the Government could consider paying for loss of income but were not obliged to do so.
  I would contend that, if the Government do not pay for loss of income, the claims will rapidly end up before the European Court of Human Rights as a fundamental violation of property rights. Perhaps the Minister, in declaring that the Bill complies with the European convention on human rights, will tell us how that can be so if he is not providing a statutory basis for compensating loss of income. I look forward with great interest to his response.
  Mr. Morley: The amendments are very important. The hon. Member for North-East Cambridgeshire (Mr. Moss) moved them in a reasonable way and made a number of fair points, which we discussed in Committee in some detail and I tried to address in some detail. I also tried to be as helpful as possible, bearing in mind that, as the hon. Gentleman rightly said, the Bill is an enabling measure. The Bill provides powers to make the compensation scheme. It is not appropriate to include enormous detail of the scheme in the Bill. The draft compensation scheme

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  will go out to consultation and involve independent assessment of its various aspects, to which I shall come in a moment.
  Mr. Hogg: If the Minister is right about that—obviously he is, in a sense—would it not be right to use the affirmative resolution procedure? Then the Minister would have to lay a draft scheme for the approval of the House and the House would at least have an opportunity to express a view on it. At present, the probability is that the House will never have such an opportunity.
  Mr. Morley: A draft scheme will be produced, circulated and opened to consultation. The right hon. and learned Gentleman will appreciate from his time in government that I follow the professional advice of departmental advisers on the use of affirmative and negative resolution procedures.
  I shall deal with the amendments one by one. The right hon. and learned Member for Sleaford and North Hykeham and the hon. Member for Somerton and Frome (Mr. Heath) were right in their interpretation of amendment No. 5. It would extend a requirement to make a compensation scheme to the National Assembly for Wales. That would be superfluous because there are no fur farms in Wales.
  I sympathised in Committee with the points made by the hon. Member for North-East Cambridgeshire about the requirement for MAFF to make a compensation scheme in England. That was one issue debated by my hon. Friend the Member for Liverpool, Garston (Maria Eagle) during the passage of her private Member's Bill, on which there was much consultation with the National Farmers Union—when, of course, we listened to points made by fur farmers.
  I draw hon. Members' attention to clause 5(1), which states:
  The appropriate authority may (and, in the case of the Minister of Agriculture, Fisheries and Food, shall) by order make a scheme for the making of payments.
  I have already accepted that that is a cast-iron guarantee that there will be a compensation scheme. I give the hon. Member for North-East Cambridgeshire that assurance.
  Amendment No. 6 and the first parts of amendment No. 7 and new schedule 1 address aspects that can perfectly be part of consultation on the scheme. I caution the hon. Member for North-East Cambridgeshire against requiring great detail in the Bill. I know that it is not his intention, but a quest for such detail can be restrictive and make it more difficult to respond to consultation and include aspects that people feel are appropriate. We believe that the current provision is adequate.
  As the hon. Member for North-East Cambridgeshire said, there is an appeals procedure via arbitration or the Lands Tribunal—two opportunities. Setting up an advisory body is a complicated and bureaucratic approach to the issue. We have already said that, in drawing up the draft compensation scheme, independent assessors will visit fur farmers to consider what should be part of a compensation scheme and, of course, of the valuation.
  Although those assessors will report to MAFF, they are individual assessors—chartered accountants, for example. They are governed by their professional bodies, as those hon. Members who are chartered accountants know well. There is an element of independence within the
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  assessment that we are proposing, so such an external body, with all the bureaucracy and possible delay that it would entail, is unnecessary.
  Amendment No. 8 contains a list of compensation provisions, put forward in the light of the consultation exercise. I made it clear in Committee that many of those are perfectly reasonable and valid. In Committee, the Government accepted much of what was put forward, and the Bill provides the power for such a detailed scheme. However, we are back to the problem that to include too much detail in the Bill would be restrictive in a way that I know the hon. Member for North-East Cambridgeshire would not wish.
  Mr. Hunter: I have read and re-read the Parliamentary Secretary's comments in Committee on the issue of compensation, but I cannot see a categorical assurance that loss of income will be reflected in the scheme. Can the Minister clarify that point?
  Mr. Morley: The original Bill promoted by my hon. Friend the Member for Garston deliberately precluded compensation for loss of income. In the light of representations that we have received, this Bill provides for compensation for loss of income, and that will rightly feature in the consultation process. The independent assessors will, among other things, assess income when they visit farmers when the Bill receives Royal Assent.
  I was tempted by amendment No. 10 in the spirit of moving the Bill forward. I recognise that there are legitimate concerns about compensation, and I can give the clear undertaking that Ministers will not unreasonably withhold agreement to go to arbitration. I am happy to put that assurance on the record.
  Amendment No. 11 relates to the time scale for compensation. I repeat that I understand that many fur farmers want a compensation scheme up and running as soon as possible. When I last met them they said that they were anxious to have some clarity about where they stood. If there was to be a Bill, they wanted it to make progress and have it implemented as quickly as possible so that they could make their decisions and be compensated accordingly. That is what we have tried to do. We must have the consultation period. It is a convention that, in general, no Act of Parliament should be brought into operation earlier than two months after Royal Assent.
  Mr. Gray: If all the Minister wants to do is to get rid of the fur farmers in the United Kingdom and if he is prepared to pay compensation in order to do so, why does he not just offer that to the fur farmers without passing the Bill? He would then stamp out fur farming at a stroke in this country without any need for the process that we are going through at the moment.
  Mr. Morley: There are one two tiny technical problems with that approach, one of which is that one may obtain the agreement of existing fur farmers but, without a Bill to prohibit fur farming, others might set up.
  Mr. Ian Cawsey: Without a Bill to outlaw fur farming, what would my hon. Friend be compensating?
  Mr. Morley: That is a good point. Without the prohibition of fur farming there would be no grounds for

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  compensation. We are delivering a pre-election pledge. I recognise the impact of the measure on British fur farmers and that is why, throughout the Committee stage, I tried to incorporate as much detail as I could on compensation. I have tried to be genuinely helpful, almost to the point of bending over backwards, both in Committee and today, to take such matters into account. We intend to do that. I want a scheme to be established as quickly as possible after the Bill receives Royal Assent.
  9.45 pm
  Until the Bill becomes law, there is no basis for a compensation scheme. I therefore hope that the Bill has a speedy passage through both Houses and that I have dealt with the points that the hon. Member for North-East Cambridgeshire made so reasonably.
  Mr. Hogg: Will the Parliamentary Secretary give way?
  Mr. Morley: I am afraid that I am about to conclude. I hope that I have answered many of the points that were made.
  9.45 pm
  Mr. Moss: I thank the Parliamentary Secretary for his response, but he did not cover all the points that I made. For example, he did not consider the proposed new schedule in any detail. He talked about special advisers, including a few accountants, but he mentioned no other professionals. I am astounded that even at this stage, he does not consider including other professional advisers in the team that he will send out to undertake the consultation and make the assessment. It will take more than accountants to reach a sensible conclusion.
  Who will the accountants be? Will they be Treasury accountants? In Committee, the Minister said that the advisers would not be MAFF people. However, I begin to fear that if the advisers are only a few accountants, they may be from the Treasury. What hope would fur farmers have in that case? I should be grateful if he elaborated on the likely identity of the accountants, and whether he believes that, in the spirit of the proposed new schedule, there should be a balanced and professional team. He did not mention numbers. Does that mean that two, three or more people will be special advisers? A little more detail would have been helpful.
  The Minister dismissed the main thrust of the amendments on the basis that they were too restrictive. However, I believed that I had covered that point in amendment No. 7, which proposes setting up an independent advisory body
  to advise the appropriate authority—
  that is, the Minister—
  on all aspects of the scheme.
  That, of course, refers to the compensation scheme. I did not believe that there could be a definition more all-embracing than
  all aspects of the scheme.
  The idea that the amendments would lead to restrictions on the consultation on compensation does not hold water. The amendments are clear cut. The body would deal with all aspects of the scheme. The proposed new schedule
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  gives details about what should be included. For example, I mentioned income. The Parliamentary Secretary gave assurances in Committee that the Bill allows for income to be taken into account. We agreed that that should happen. We did not table an amendment to that effect because we had received assurances about it.
  Any compensation scheme could be cash limited. The Treasury has suggested ball-park figures, of which the Ministry has taken account. The Treasury will not be happy if the upper limit of £1.6 million is exceeded. However, that upper valuation of the 13 fur farms is light years away from the industry's view of the real value of their businesses.
  We have heard the example of the Austrian compensation scheme. It is the only one that we currently know about. Its compensation equates to approximately £400 per breeding female. That makes the total value of the United Kingdom fur farming businesses approximately £8 million to £10 million. The Minister assured us that the £1.6 million mentioned in the explanatory notes was not set in stone. We take that assurance with a pinch of salt.
  If the Minister simply sends out a few accountants, and the ball-park figure remains the Treasury figure of £1.6 million, not much consultation will take place. The pre-ordained sum will simply be carved up.
  Mr. Clifton-Brown: Since I spoke, a document containing the compensation scheme for the Firearms (Amendment) Act 1997 has come into my possession. It took eight months to produce after the Bill received Royal Assent. Does my hon. Friend agree that it would be intolerable if it took eight months to produce the compensation scheme for this Bill, when it will be illegal to keep the animals after 1 January 2003, roughly two and a half years after the Bill receives Royal Assent? Clause 5 will come into effect two months after Royal Assent, and the compensation scheme could take eight months to produce before anyone could start working on a claim. That is unacceptable.
  Mr. Moss: My hon. Friend makes a valid point, which he also made in Committee. The Minister has not answered it directly, although he has given some indication of the likely time scale for setting up the scheme and the consultation that will accompany it.
  The Minister should respond to some of the detailed points that I have put to him. No guarantees have been given, and the whole purpose of the amendments was to seek clarification and guarantees that key areas of the compensation scheme would be taken into account in the consultation. If the Minister intends to send out only a few accountants, with a ceiling for the scheme of £1.6 million, I fear that the fur farmers will be sold down the river.
  Amendment negatived.
  Order for Third Reading read.
  9.51 pm
  Mr. Morley: I beg to move, That the Bill be now read the Third time.
  I am sorry that the hon. Member for North-East Cambridgeshire (Mr. Moss) did not feel that I gave enough assurances about the compensation scheme, which is, in many ways, at the heart of the Bill, because I tried

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  hard to do so. This is an enabling Bill and will give powers to bring forward a scheme with full consultation, during which all the points can be raised. In Committee, I also gave a detailed analysis of how we can achieve those objectives.
  I thank those hon. Members who have made constructive and thoughtful contributions on the Bill, as well as my hon. Friends—not least, of course, my hon. Friend the Member for Liverpool, Garston (Maria Eagle), who piloted a private Member's Bill on the issue and did much of the preliminary work on prohibiting fur farming in this country. She was very influential in shaping the Bill in its final form. We took account of the representations that were made and tried to address the legitimate concerns that were raised.
  We have had a response from the European Union to the Bill, and it did not object to it. I wish to make that clear. Therefore we are within our rights to proceed with it, taking into account our obligations under human rights and other legislation. We are confident that it meets all the requirements that we are obliged to address.
  I must say to the hon. Member for North Shropshire (Mr. Paterson)—or perhaps I should say the hon. Member for Denmark, Central—that the Bill does not seek to impose our views on other member states. The treatment of fur farming in other member states is, rightly, a matter on which those countries must make their own decisions. Several other member states share our views on fur farming, the moral issue of how animals are treated and whether animals are being killed unnecessarily. We do not seek to impose our views on other member states, so we are within our rights to say that we do not appreciate it when other organisations and countries wish to impose their views on what we, through our democratic processes, do. I hope that the hon. Member for North Shropshire takes that into account.
  In conclusion, I think that the Bill is important. Many people feel strongly about as it deals with an issue of public morality. I am sorry that the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) referred to it as an odious measure.
  Mr. Hogg: I said that it was an odious little Bill.
  Mr. Morley: I stand corrected. Frankly, I think that the political philosophy that justifies the abuse of animals is odious.
  The Bill addresses a real issue of morality concerning the way in which we treat animals. I am grateful for the support that it has received from many hon. Members on both sides of the House and I certainly hope that we have addressed the legitimate concerns that have been raised during its passage through the House.
  9.55 pm
  Mr. Moss: The heart of the Bill is not the compensation clause but clause 1, which creates the offence of keeping animals primarily for the value of their fur. For the first time it criminalises a legal farming activity, which even after the Bill receives Royal Assent will still be legal in the rest of the European Union.
  It is incumbent on the Government to give their reasons for introducing such draconian legislation. The Bill proposes a ban on fur farming. What do the Government
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  tell us by way of justification? Their only justification at the time of the private Member's Bill introduced by the hon. Member for Liverpool, Garston (Maria Eagle) was animal welfare. They have now shifted to a position on public morality. The Minister said in Committee:
  we want fur farming to be banned because it is unethical.
  He confirmed the seismic shift in the Government's thinking when he said:
  arguing purely on welfare grounds is irrelevant.—[Official Report, Standing Committee E, 23 May 2000: c. 34–5.]
  There is some inconsistency in the Government's approach. They often use public opinion and opinion polls to justify their course of action. However, public opinion says that the live transport of animals is wrong, yet the Government have found a middle way on that. Public opinion says that the cloning of farm animals is wrong, but again the Government have found a compromise. So public opinion is not an overriding consideration. In our view the fact that a majority of people want fur farming banned is not a reason per se for introducing an offence and banning it.
  Setting aside for a moment whether a ban is fair, reasonable or even justified, we must ask whether it is legal in the context of existing EU legislation to which the Government have signed up. It is worth exploring that point. After all, it is surely misguided of the Government to introduce legislation that seems to fly in the face of current EU law.
  Mr. Eric Martlew: Does the hon. Gentleman intend to divide the House on this matter?
  Mr. Moss: The hon. Gentleman will have to see what happens at the end of the debate.
  It is worth exploring the legal position given that the Bill appears to fly in the face of current EU legislation. So worried are the farming and agricultural interests within the EU about the implications of the offence created in clause 1 that they have sought legal advice.
  The Committee of Agricultural Organisations in the European Community—COPA—and the General Committee for Agricultural Co-operation in the EU—COGECA—presented a paper of legal advice in which they argue that a ban as proposed by the Government is incompatible with European law on a number of grounds. They cite articles 28 and 29 and of the EC treaty, the principles of proportionality and non-discrimination and a judgment in November 1998 in which the European Court ruled that a member state is not entitled to enact national animal welfare measures once a harmonisation directive or regulation has been adopted. They also cite the common organisations of the market. They argue that where regulations are based on an open market to which every producer has free access, the keeping of animals covered by the organisations cannot be prohibited.
  It being Ten o'clock, the debate stood adjourned.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 15 (Exempted business),
  That, at this day's sitting, the Fur Farming (Prohibition) Bill may be proceeded with, though opposed, until any hour.—[Mr. Touhig.]
  Question agreed to.
  Question again proposed, That the Bill be now read the Third time.
  Mr. Moss: Powerful and cogent legal advice from lawyers conversant with EU law questions in a

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  fundamental way whether the creation of an offence of keeping animals for their fur can be made to stick. Without the offence, the Bill collapses and a ban is impossible to implement. That is why it is vital to challenge that crucial element of clause 1.
  In our opinion, the paucity of uncontested, reliable and corroborated scientific evidence about mink welfare has caused the Government to drop their animal welfare objections to fur farming, and to switch their justification for the ban to grounds of public morality. On Second Reading and in Committee, the Minister offered various definitions of what the Government meant by the term "public morality". The latest definition came in a written answer of 22 June. The Government admitted:
  "Public Morality" is not susceptible to an absolute definition: it inevitably involves subjective judgment.—[Official Report, 22 June 2000; Vol. 352, c. 300W.]
  The Minister mentioned that the Government had received a letter from the European Commission responding to the six member states that objected to the Government's proposals. The Commission said that countries such as the United Kingdom and the Netherlands should wait for the proposed new EU legislation on fur farming
  before taking any unilateral measures.
  Mr. Morley: The hon. Gentleman might find it helpful if I clarified that situation. Six representations were received, but only one was an objection. Four countries made observations, and one country wrote in support of the UK position. The EU said that it would be preferable to wait until a forthcoming report on animal welfare was available, but that is irrelevant to the Bill, which is being introduced on the basis of article 30 of the European convention on human rights. That article has to do with public morality, not animal welfare.
  Mr. Moss: I accept that the Bill is being introduced in line with article 30, but the Commission has advised the Government to hold on before acting unilaterally in passing legislation. The reason is that the Commission is bringing in new directives and regulations that relate to fur farming throughout the whole of Europe. When those regulations are introduced, it may be even easier for countries to object to what the Government propose in the European Court.
  Mr. Hogg: Does my hon. Friend agree that the Government are introducing the Bill now rather than waiting for new proposals from the European Union because it would be extraordinarily difficult for them to bring forward a Bill prohibiting fur farming when a European Union regime is in force?
  Mr. Moss: My right hon. and learned Friend makes an excellent point. The Bill represents a high-risk strategy. It must be obvious, even to this blinkered and politically correct Government, that these provisions will be challenged in the European Court by significant numbers of EU member states. That could be a prolonged and costly exercise, and I wonder whether the Treasury will countenance what the Minister is doing.
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  What costs are likely to arise, and who will foot the bill? No doubt the Treasury will say that any costs of litigation will have to come out of the budget of the Ministry of Agriculture, Fisheries and Food—which we already know is under considerable pressure.
  The Bill is, as we know, supported by Labour Members, probably on a three-line Whip. They are determined to oppose fur farming—or, more accurately, those who wish to wear fur as part of a legitimate life style—and they are determined to force their views on the rest of us. I can put it no better than Roger Scruton, who said in a recent article that to imagine that we have the right to outlaw those life styles merely because they get up our class-conscious nose is to base our legislation not on public morality but on private snobbery.
  10.5 pm
  Maria Eagle: I do not intend to detain the House for long, but I wish to make a couple of remarks about the Bill before it goes to the other place, and shortly thereafter, I hope, becomes law.
  I welcome the Bill. I listened with care to the debates on my private Member's Bill in the previous Session, and to those at all stages of this Government Bill. We have rehearsed some of the arguments again this evening on Report. However, I note that, despite much of the sound and fury and occasional flights of fancy about furry sheep that we have heard from Conservative Members, at no point thus far in the proceedings of either Bill have they sought to divide the House. It will be interesting to see whether they do so in due course.
  The Bill will be welcomed by the majority of the public, by right hon. and hon. Members on both sides of the Chamber, and even by the Fur Breeders Association, which represents all the remaining fur farmers in this country. If I were to confine my feelings about the Bill to one sentence, it is this: I welcome it because it will end the cruel practice of keeping essentially wild animals in extremely small cages merely and solely to collect the commercial value of their fur.
  The right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg), who has taken part in many of our deliberations during the proceedings on both Bills, and whom I have listened to with some respect, called this an odious little Bill. I beg to disagree with him: I think that it is a humane little Bill, and I commend it to the House.
  10.7 pm
  Mr. David Heath: I agree with the many right hon. and hon. Members who have spoken at various stages of the Bill's proceedings that it is a pleasure to reach Third Reading, especially having listened to some of the deliberations that preceded it. I congratulate the Parliamentary Secretary on taking up this measure and making it a Government Bill. My view is that it always should have been a Government Bill. By that I mean no disrespect to the hon. Member for Liverpool, Garston (Maria Eagle) or my hon. Friend the Member for Lewes (Mr. Baker), who brought forward a similar Bill previously. However, Government legislation is appropriate in this area.
  Fur farming is an anachronism, and the public are out of sympathy with it. However, that is not reason enough to ban what has hitherto been a legal activity, and

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  Parliament must take that matter extremely seriously. Nor do I think that we should act out of our personal taste or distaste for the activity and its consequences. If I have any difference of opinion at all with the Minister, it is about whether public morality or animal welfare comes first. To me, the public morality lies in the indefensibility, in animal welfare terms, of keeping in a small cage an animal which, as the hon. Member for Garston said on Second Reading, is a solitary carnivore, territorial in nature, semi-aquatic and, in its wild state, used to roaming over large areas of countryside. Given the intensive circumstances that are necessary for fur farming, I do not believe that it is possible to bring the detention of those animals up to standards that are acceptable in animal welfare terms. That is why I think that the Bill is to be welcomed and should command support.
  The important issue of compensation is addressed in the Bill. I would not be happy to support it were there not adequate measures for compensation. I have to say that we have heard more from Conservative Members about the European convention on human rights over the past three or four months than in the previous 20 years. It is extraordinary that this measure, the incorporation of which into British law was so vigorously opposed by Conservative Members, is now seen as the touchstone for the appropriateness of every clause and sentence of legislation. Well, so be it.
  We have had a declaration of compatibility for the Bill from the Minister. Were is not for the compensation provisions, the Bill would not be compatible with the European convention. I did not seek to intervene on the amendments that we discussed in the previous debate, but I have to say that if the compensation mechanism was unfair in its application or insufficient to meet the legitimate needs of those affected, the Bill would fall foul of the European Court. So it is incumbent on Ministers to get the compensation scheme right, and I am confident that they will do so. It is a prerequisite for completion of the passage of the Bill.
  The last point is whether we have to wait for the European Union to take Communitywide action on fur farming. Sometimes we have some topsy-turvy debates in this place, but when I hear the Conservatives argue that we should not take a decision in the British Parliament on what happens in Britain because we must wait to be overruled by the EU, I fail to understand the position of that party on anything. That view is shared by many people across the country.
  The Liberal Democrats support the Bill. I honestly do not know what the Conservative position is. We have heard the Bill described as odious, vile, appalling and dangerous, yet it appears that the Conservatives are not prepared to divide the House on it. Could it be simply that, whatever Conservative Members' personal prejudices, they are afraid to divide the House because they know that public opinion is strongly in favour of the Bill? So are we.
  10.13 pm
  Mr. Cawsey: I have some valued friendships on this side of the House, so I shall be brief. I want to say a few words on Third Reading because I missed Second Reading due to an unexpected hospitalisation. While I managed to wangle a discharge to get down here in time to vote, the House did not divide on that occasion, which only shows that one cannot rely on the Conservative party for anything these days.
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  I congratulate my hon. Friend the Member for Liverpool, Garston (Maria Eagle) on all the work that she has done on the Bill. It is only through her determination that we have reached the stage that we are at today. I thank colleagues in the all-party group on animal welfare, which I have the honour to chair, for its support, and I am grateful for support not only in this House but in the other place. We hope that that means that the position looks good for the future.
  Mink farms do not replicate the semi-aquatic environment that mink need to thrive. Mink are difficult animals, as all hon. Members have acknowledged. They are non-indigenous, and they can cause mayhem in the country. Conservative Members made much of recent escapes of mink and blamed animal rights groups for them. I agree with my hon. Friend the Minister that all escapes are to be condemned, but it is worth reminding ourselves that historically the feral population of mink came about as a result of poor husbandry on mink farms, not the activities of animal rights groups. So the fact that we have mink in the countryside now is the fault of neither one side nor the other. They are both responsible and all escapes should be condemned. The point is that the only way to prevent future escapes is to ensure that the Bill becomes law and that mink farms are abolished in this country.
  The right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) referred to the Bill as "an odious little Bill" several times. I disagree with him, although it would be wrong not to say that as he was speaking, the words "little" and "odious" were in my mind.
  Mr. Deputy Speaker: Order. That was an unworthy remark, and I ask the hon. Gentleman to withdraw it.
  Mr. Cawsey: I withdraw it and apologise to the House.
  The issue is whether we believe that animals should be kept coley and primarily for the value of their fur. I do not, and I believe that most hon. Members do not. The Bill has warm support in the House, and I hope that it will have support in the other place and that members of the British public will support us for passing it.
  10.14 pm
  Mr. Hogg: I oppose the Bill. It is quite wrong and I do not resile from my comment that it is an odious little Bill. I oppose it on principle and on grounds of detail. I shall deal first with the detail—I can do so quickly as I have already covered it; it concerns compensation.
  Let us be absolutely plain about the matter. The compensation set out in the Bill is quite inadequate. There is an obligation on the Minister of Agriculture, Fisheries and Food to produce a scheme—that he must do. However, the Bill includes no provision that any particular element of compensation should be incorporated in the scheme. For example, we have been talking about compensation for loss of income, but there is no mandatory obligation on the right hon. Gentleman or his colleagues to include such a measure in the scheme.
  Let us be clear too that, subject to any consideration of Lords amendments, this is the last time that the House will discuss the compensation payable under the scheme because, as it will be introduced as a statutory instrument subject to the negative procedure, we simply shall not discuss it.

  1009
  The scheme will be introduced by a Department operating within financial constraints, in the knowledge that there will be clawback under its budget. We can be sure that the scheme will be a mean one and that we shall have no opportunity whatever to expand on it. The measure is defective in detail because there is no mandatory requirement to include certain desirable elements in the compensation scheme. That is the first point.
  The second point is not central, but it is of some importance; it is in regard to Europe. I have come to the view that we should not impose on British producers and farmers unilateral restrictions on grounds of welfare that are not matched by commensurate requirements elsewhere in the European Union. I know perfectly well that I was a member of a Government who did introduce such provisions. We introduced a range of unilateral measures—in respect of pigs, for example—that were not matched in Europe. That was a mistake. At the time, I made it clear that we should not do that again while I was a Minister. I am very much against imposing on UK producers requirements that are not matched in the EU, nor, indeed, outside the EU.
  Those are minor points. My main point is that the Bill is wrong in principle. What is the justification for the Bill? We must ask ourselves that question. There are two possible justifications: the first is on welfare grounds; the second is that the practice is unethical, immoral and so on.
  I shall deal first with welfare. I listened carefully to the Parliamentary Secretary. I read several of his observations in Committee. I have also read the speeches made by the hon. Member for Liverpool, Garston (Maria Eagle). She argues the welfare cause rather more than it has been developed by the hon. Gentleman today. However, he made it wholly plain that the welfare arguments are not the crux of the matter. He said that the killing was unnecessary. It is to be banned because it is unethical.
  If we were debating the issue on welfare grounds, I should have more sympathy. It is at least possible that mink cannot properly be kept in conditions of captivity. If that were so—if it were a proven fact—I should give serious consideration to a prohibition. However, that is not the case that is being put forward, because—I suspect—of the European dimension.
  It could also be said that the animals can be kept only in certain prescribed conditions that might have the effect of making the business uneconomic. If that was the position, I would give that serious consideration too, because if the Bill had a genuine welfare foundation, it would be proper for the House to respond. But I do not actually believe that that is the position.
  The position that I believe to be the case—and, to be fair to the Parliamentary Secretary, it is the position that he declared in his Third Reading speech—is that he regards the keeping of these animals for fur as immoral, unethical and improper. In other words, he is elevating his own moral judgment—and, to be fair, that of his hon. Friends too—and saying that because they deem it to be unethical and improper and immoral, it should be made illegal. That is where I really do part company from the hon. Gentleman, on the ground of principle. I believe profoundly in liberty, and in a free society people do have a right to do those things of which other people
  1010
  disapprove. It is not a free society if the individual is allowed to do only that of which the majority approves. Within a free society one has a right to sin; one has a right to choice; one has a right to make these moral elections. We are being denied that right, and I say that that is profoundly—
  Mr. Martlew: The right hon. and learned Gentleman obviously feels very passionately about this. Does he intend to divide the House on the matter?
  Mr. Hogg: I will give an honest answer: no, I do not, because I do not have the troops. [Interruption.] The hon. Member for Falmouth and Camborne (Ms Atherton) may find that funny; I am answering the question. I do not intend to divide the House, because the troops are not here with which to divide the House. The point, none the less—[Interruption.] I can be accused of anything, but I cannot be shouted down. I propose to assert a principle.
  Mr. Deputy Speaker: Order. Let me assure the right hon. and learned Gentleman that he will have the help of the Chair in ensuring that neither he nor any other hon. Member will be shouted down in this House.
  Mr. Hogg: We are at risk of losing a principle. In a free society, people do have a right to so order their affairs as to do that which they wish to do, unless there is a compelling reason against it. I ask, what is the compelling reason in this case? We know full well that many species and classes of animal are kept in unsatisfactory conditions or in conditions which are not natural, for the use of mankind. We keep chickens in battery cages.
  Mr. Morley: I want to make it very clear to the right hon. and learned Gentleman that, in coming to a position of public morality, issues such as welfare and the impact on the environment are all part of taking into account the morality of a decision. Any kind of rearing system which has the effect of animals chewing off their own tails is questionable ethically and morally. How far does the right hon. and learned Gentleman take his position about the freedom of individuals? Is he arguing that people should have the right to use drugs, for example?
  Mr. Hogg: The Parliamentary Secretary has given the game away, because if he wants to talk about the conditions of animals, he had better address the keeping of chickens in battery cages. [HON. MEMBERS: "We are."] We are, but let me remind the hon. Gentleman how we are—
  Mr. Keith Bradley (Treasurer of Her Majesty's Household): What did you do? Did you do anything?
  Mr. Hogg: We did, in fact. We pushed forward within the European Union and secured a new regime on the size of cages and the conditions. The point is that in regard to the keeping of chickens in battery cages, which I have always found a rather disagreeable practice, the approach that the House has taken in the past, and the approach that the European Union has taken, has been not to prohibit that but to require a higher standard of husbandry.
  We are entitled to ask why this distinction of principle is being made as between, for example, the keeping of chickens, which is the example that the Parliamentary

  1011
  Secretary chose, and the keeping of mink. It is not good enough for the hon. Gentleman to say that questions of welfare go to the questions of public perception of morality, because in one sense they do but it is not his primary argument. Had the issue of welfare been the primary argument, that is what he would have advanced as the primary cause. In fact, he and his colleagues do not like keeping mink for the purposes of fur wearing. I suspect that they do not like individuals wearing fur—I am pretty agnostic about the wearing of fur, save that I do not want endangered species to be eliminated.
  People who take that view should try to persuade people not to do it. That is persuasion. They should not use the criminal law to impose on their fellow citizens their own moral prejudices, which is wrong. [Interruption.] I hear wails, moans and groans from the Opposition and I am not in the least surprised. One of the characteristics of this Labour party is that it fails properly to weigh up the rights of fellow citizens. The Conservative party stands for freedom and liberty—[Interruption.] Oh yes it does, and the jeers and the restrictive measures—the proposed fox hunting Bill—come from members of a party who want to impose on their fellow citizens a narrow morality.
  I am against the Bill and I hope that in another place it will be deeply amended and—even better—thrown out.
  10.26 pm
  Mr. Gray: My right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg) made a powerful and unanswerable libertarian argument. The catcalls and grins from Labour Members demonstrate that they do not understand libertarianism. They do not understand freedom of the individual; all they understand is central control and imposing their view of morality on the rest of us.
  I hold no particular candle for fur farmers. I have none in my constituency. I am sorry to say that I think that I own no fur and neither does my wife. I have no reason to believe that fur farming is necessarily a good thing. My opposition to the Bill is based not on the principle, but on the Bill's sheer illogicality.
  I see the hon. Member for Liverpool, Garston (Maria Eagle) returning to her place. [Interruption.] I was not implying that she had left it. I was about to, but then realised that she was delivering a note to the attendant, so I forgive her. I did not intend to impugn her attendance record. She has been here throughout the debate and has diligently pursued the matter for about three years, so I was not suggesting that she was slacking in any way.
  When the hon. Lady brought her private Member's Bill to the House, her primary argument was animal welfare. She said that it was the wrong way to bring up these animals, it was disgraceful and it should not happen. That may well be a powerful argument. I am strongly committed to improving the standards of animal welfare wherever we can. However, that being so, there are many ways to do it by regulation: improving the way in which these animals are brought up.
  There are about 8,000 mink farms in Europe. We have 12 or 13 in this country and, by banning them, we will not be improving the lot of the 500,000 mink, or thereabouts, in Europe. It will be a politically correct gesture within these shores that will achieve nothing for animal welfare. Indeed, one could argue that we are
  1012
  harming animal welfare, in that we are exporting the production of fur. We are saying that we do not want it here, but will be happy for it to continue in Russia, which is one of the biggest producers of mink—mink produced under some of the worst conditions. One might argue, as I think my right hon. and learned Friend the Member for Sleaford and North Hykeham did, that if we are concerned about animal welfare, we should encourage good practice here, where we can control welfare standards on the farms, rather than exporting them to Russia, Mongolia and elsewhere.
  An interesting change came about between the Bill introduced by the hon. Member for Garston and this Bill. It was first raised by the Parliamentary Secretary during a MAFF press conference on the issue and he has raised it several times today. We have got away from the animal welfare arguments. I think that the Government realised that they were not sustainable. If one is talking about animal welfare, this measure is not the way to put that right.
  All of a sudden, the Government raised the issue of public morality. Let us think for a few seconds about that. First, what is public morality? Their arguments on this Bill, on fox hunting and on other measures of the sort are that the practices that should be banned on the grounds of public morality are practices that the majority of people dislike. They constantly talk about polls and say that 80 per cent. of people in the United Kingdom dislike fur farming. They also use that argument against fox hunting, saying that the majority of people in Britain dislike it.
  I would argue that true public morality is about looking after the interests of the minorities—the small battalions—and the people who cannot look after themselves. For the Government to ban something because most people say that they want it banned is to abdicate their responsibility and to say that they are unable to make decisions on behalf of the people, so they will govern by opinion poll.
  The Bill puts the Government in a peculiar position. We know that the business of the House and the other place is in the most appalling logjam, and all kinds of rumours are circulating in the Corridors as to whether or not the Government will be able to complete the passage of their important Bills. Even my constituents are asking why, if that is the case, we are wasting our time dealing with this Bill. There are only 13 fur farms left in the United Kingdom. Even if the Government hate fur farming, we should be dealing with health, education, law and order, and defence. [Interruption.]
  If Labour Members will listen, I will suggest a reason why we are dealing with this Bill. It has nothing to do with animal welfare or public morality, which the Government have not got around to defining; it is about political correctness. They want to demonstrate that they are friends of the cuddly animal, but the Bill is the enemy of the cuddly animal. If they raised the standards of UK fur farms, they would be friends of the cuddly animal.
  There is a further fundamental illogicality in the Bill. The Government could come to the House and say, "We hate the wearing of fur. We believe it to be immoral. Fur is a disgrace. We shall ban the sale of fur in Harrods and the wearing of fur in public places. We shall ban the international trade in fur." Most of that trade is conducted in London. If the Government said that, I would wholly disagree with them and think it an absurdity, but it would

  1013
  be an intellectually honest thing to say. The Government have introduced such bans on ivory and on the importation of certain animals. They have said that the trade concerned is immoral and disgraceful and that they will not have it—but they will not do that in this case.
  The Government know that the wearing of fur is on the increase in the United Kingdom, as are the sales of fur in Harrods and elsewhere. Fur is imported from Russia and sold to America, but the trade is conducted here in London. The Government are not banning that. They do not have the moral courage to say that it is a disgraceful activity and that they hate fur. All they say is, "We know a group of 13 farmers and we believe that, politically, we would achieve an awful lot by coming down heavily on them. Despite the fact that there are 8,000 other fur farmers in Europe, we can demonstrate that we are hard on such people. We are politically correct, wonderful new Labour and we will sort out the ills of the world by wasting parliamentary time dealing with something in which the people are not the slightest bit interested." [Interruption.]
  Once again, we see new Labour for what it is. All that Government Members can think about is whether or not it is time to go home. We are ready to discuss these matters for as long as it takes, and if we divided the House, as one Member has constantly suggested we should, Third Reading would take considerably longer than it otherwise would. Before he leaps to his feet, I should say that I have not discussed the matter with my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss), but as far as the Conservative party is concerned, this is a matter of individual conscience and there is no Whip on it.
  I, for one, will not seek to divide the House because it is important that we should make these powerful arguments, and I am confident that noble Friends and peers from other parties will want to develop some of them in the other place. They will want to point out the illogicality in the Bill and its incipient and unpleasant political correctness. They will want to try to sort out compensation for the victims of that political correctness. They will seek to correct this badly drafted Bill, which was introduced not for reasons of animal welfare or public morality, which the Government have not defined, but simply to try to brush up the Labour party's rather tarnished credentials. It is an attempt to extend the Under-Secretary's career of political correctness and to achieve what he has sought throughout his life, as an animals rights activist, and to ban something—
  Mr. David Taylor: Will the hon. Gentleman give way?
  Mr. Gray: I am sorry. I am winding up my speech. Anyhow, the hon. Gentleman has not been here all evening. He wants a little quote for his local paper. I will not give way to him for that reason. He might like to attend for the entire debate. If he wants to take part in the debate, he should attend for the entire debate and not walk in and try to intervene on an hon. Gentleman's peroration.
  The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food has spent a lot of his life campaigning for what he describes as animal rights. He
  1014
  has spent a lot of his life saying that animals are sentient beings and have the same rights as us. His friends in the animal rights movement are for ever saying—it is one of their famous quotations—that a dog is a cat is a human being; there is no difference between them. I do not agree.
  My father used a great expression which annoyed my mother a great deal. There was nothing sexist in the remark. He used to say, "Men are the lords of creation." He simply meant that human beings are the lords of creation. I believe that to be the case.
  I believe it reasonable that human beings should use animals' meat to eat and their fur to wear. None of that seems unreasonable. The Parliamentary Secretary thinks it is, but he should not use such a Bill to expose his personal prejudices and to impose on people out there, as my right hon. and learned Friend the Member for Sleaford and North Hykeham convincingly argued, a Bill that will interfere with individual liberties and achieve nothing for animal welfare at all.
  10.36 pm
  Mr. Paterson: It is a pleasure to speak on the subject. I think that it is for the last time, as we have thrashed the matter out over many months. I declare that I have no constituency interest in the matter. I used to be remunerated in the leather trade. I stress that there is no connection between the leather trade and the fur trade because the leather trade processes a by-product of the meat trade. We are discussing the banning of raising animals specifically for fur.
  I believe that a pluralist society cannot be run peaceably if the majority abuse their power over the minority. We are talking about a tiny number of people: 11 fur farmers own 13 fur farms, as against 8,000 fur farms on the continent, where, as I have said, it is a significant business—fur farming makes up perhaps 4 per cent. of Danish GDP.
  The central nonsense of the Bill remains. I know that Labour Members do not seem to like evidence from Europe this evening, but I have a fax from the marketing department of the Charente Maritime Department in France. It states that 40 per cent. of rabbits are raised for meat and 60 per cent. for fur.
  That is the central nonsense of the Bill. If it is passed, a British citizen could be fined £20,000 for keeping a rabbit in a cage, despite adhering to a raft of UK and European regulations. Exactly the same rabbit could be kept in the same cage and could be legally sold on for a profit. The difference is that the first rabbit would be killed for its fur and the second for its meat. That is totally illogical. Labour Members have failed to address that at any stage on the numerous opportunities that they have had to do so.
  I do not want to go into the great raft of regulations governing those animals. If there were a case of animal cruelty, we could consider banning the activity, but the man in charge of ensuring that the activity is not carried out cruelly is sitting before us. He is the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food. He is in charge of the Mink Keeping Order 1997, the Agriculture (Miscellaneous Provisions) Act 1968, the Welfare of Animals (Slaughter or Killing) Regulations 1995, the 1991 Council of Europe convention on the protection of animals kept for farming purposes, and the EU directive on farm animal welfare.

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  The Parliamentary Secretary is the man who should be ensuring that there is no cruelty. There is a library of regulations that he should be enforcing. If there is cruelty, he is the man in charge and at fault, but no one in the course of debates on the Bill has talked about animal cruelty. Members have fallen back on something extraordinary called public morality, which appears to come down to the ability of the majority to trample wilfully on the minority for doing something that they do not like.
  It is immoral to force the United Kingdom into what might be a huge legal battle with determined, well financed industrialists on the continent. As I have said, there are 8,000 fur farms on the continent and they have substantial financial resources. They have made it clear to me that they will confront the UK Government head on. They are convinced that the measure is incompatible with the European convention on human rights and that it breaches articles 28 and 29 of the EC treaty: the principle of proportionality and the principle of non-discrimination. They have made it clear that they are determined to stop it.
  Today, I received a telling message from Wim Verhargen. He said that he was still determined to stop this measure in the European Court and that it was ridiculous to be able to buy a Government. He added that it was not a welfare discussion. He said that it opened the door to banning many other activities on the ground of public morality and that it was a very dangerous precedent to ban an economic activity in which welfare was not a problem. I heartily endorse that view.
  The conditions for compensation are wholly inadequate. They are not detailed enough and they are not mandatory. The figures mentioned in the explanatory notes are derisory. I talked today to Mr. Gunter Pfeiffer, the only fur farmer in Europe to have a farm closed. Unfortunately, it was an extremely crackly mobile phone line and, although I learned my German in Vienna, he spoke with a strong Austrian accent. Still, the gist of the matter is that he was paid to cease his business. Although the law still allows fur farming in lower Austria, he was
  1016
  paid a lump sum of 4.7 million Austrian schillings to close his farm. To show what a pointless exercise that was, he moved his whole operation to the farm that he already owned in the Czech Republic, just 30 km away.
  Exactly the same thing could happen in the United Kingdom. We have a large farm in the south-west that has a sister operation in Denmark. There will be no sum gain to mink happiness. Instead, there will be a huge bill to the British taxpayer. If there are about 25,000 female animals in UK mink farms and it costs £400 to compensate for each of them, the overall cost will be just over £10 million. That is a long way from the figure mentioned in the explanatory notes.
  I do not believe that the Minister has gone into the issue in detail. For him it is a great victory. We know that the Labour party has received sums from animal welfare groups and that it considers it a triumph to get the Bill through. The Minister will be congratulated by Labour Members. However, it is immoral to spend a whole evening debating this issue when this country faces many much greater problems. We may have to spend £10 million of taxpayers' money to compensate for a business that is legal on the rest of the continent. The Bill is unsatisfactory, because it will launch the Government headlong into a lengthy and expensive legal battle with our European partners.
  Question put and agreed to.
  Bill accordingly read the Third time, and passed.

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

  PARLIAMENT
  That the draft Attorney General's Salary Order 2000, which was laid before this House on 15th June, be approved.—[Mr. Pope.]
  Question agreed to.

  Agricultural Wages Boards
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Pope.]
  10.43 pm
  Dr. Gavin Strang: I am grateful for the opportunity to raise the issue of the agricultural wages boards at a time when the Government are considering the future of the boards as part of the quinquennial review that they are required to carry out by statute.
  My guess is that this is the first debate to take place in the House of Commons on the agricultural wages boards since devolution. My right hon. Friend the Minister of State, Ministry of Agriculture, Fisheries and Food has direct responsibility for the Agricultural Wages Board for England and Wales, but the arguments that I deploy have equal force in Scotland and Northern Ireland where the decision is for the devolved Administrations.
  British farm workers are skilled workers who deserve a decent rate for the job. I am sure that nobody would disagree with me on that point. However, individual farm workers are in an exceptionally weak negotiating position with their employers. They tend to be geographically isolated, operating in remote locations. They usually work alone or alongside just one other worker, and often their house goes with their job. About a third of agricultural workers live in tied accommodation, and in some parts of the country the figure is higher than that. There is little mobility of labour, and the social relationship between the farmer and the farm worker can bring its own pressures.
  That is why the agricultural wages boards are so important. The boards provide the forum where both parties in the agricultural industry negotiate alongside independent members to reach an annual agreement on farm workers pay and conditions. The Government and the devolved representative bodies are currently considering the future of the boards under their quinquennial reviews. I am grateful for the opportunity to urge that the boards be kept, and that the Government explore options to expand their scope.
  There has been a historical consensus of support for the agricultural wages boards across the farming industry and within the rural economy. Farmers do not want a minority in their midst undercutting them by paying exploitative wages, and they appreciate that the boards remove the time-consuming and stressful work associated with annual individual pay negotiations.
  Furthermore, unlike other industries, farmers receive large sums of money from the taxpayer in the form of subsidies. It has long been accepted that as a quid pro quo, farmers should be required to provide statutory minimum rates of pay and conditions. Indeed, the Corn Production Act 1917, which first established the Agricultural Wages Board for England and Wales, also fixed minimum guaranteed prices for cereals.
  The fact that the farming unions are currently split on the future of the boards is due to the crisis in the industry. That is understandable, but the crisis in the industry should not be used as a reason for abolishing or weakening the agricultural wages boards. The current trough, though deep and damaging, must be temporary. Farmers are under great pressure to cut costs, and a regrettable but defensible response would be to reduce the
  1018
  working hours of a farm worker when less work needs to be done on the farm. However, it would be indefensible if the farm worker's rate of pay were eroded.
  Although the National Farmers Union and the National Farmers Union of Scotland report that their members currently want the boards abolished, the Country Landowners Association, the Farmers Union of Wales and the Transport and General Workers Union—the rural and agricultural workers union—are supporting the boards.
  Policies that prevent the exploitation of rural workers, of course, have support which extends beyond the organisations that represent the industry. My right hon. Friend will be aware of the strong support expressed by the parliamentary Labour party agriculture committee for the continuation of the boards with at least their present responsibilities.
  As well as the provisions of the agricultural wages boards, farm workers are protected by general employment law. It is to the credit of the Labour Government that employment law is much better than it was when last the future of the agricultural wages boards was up for review. The national minimum wage and the working time regulations are in place.
  However, the improved legislation is in no way a substitute for the boards. The national minimum wage and the provisions of the working time regulations are intended as a floor below which it would be wrong to employ workers.
  The agricultural wages boards are entirely different. First, I make the point again that the boards provide the forum where both parties in the industry reach an agreement on the pay and conditions of farm workers which reflects the state of the agricultural industry. The Country Landowners Association states that it is
  extremely important that the industry should continue to regulate the level of pay for agricultural workers and be able to take into account the peculiarities of employment in agriculture.
  Secondly, the boards provide far more than the national minimum wage and the working time regulations, as is set out so clearly in the Government's consultation document. The agricultural minimum wage is higher than the national minimum wage. The standard agricultural adult hourly rate is £4.57 in England and Wales, £4.42 in Scotland and £4.38 in Northern Ireland, compared with the adult national minimum wage of £3.60.
  The board in England and Wales sets down rates of pay to reflect the skills of farm workers. In an industry where a career structure is difficult to establish owing to the small number of workers in each unit, this provides an incentive to train. The Farmers Union of Wales said:
  rewarding qualifications, levels of responsibility etc is a vital means of persuading high-calibre people to remain in or enter the industry.
  The boards set overtime rates. That is very important, as the average working week for a farm worker in England and Wales is 48 hours. They set a better working week, better sick pay, better holidays and rest breaks, a rate for working at night, a better rate for tied accommodation, an allowance for keeping a working dog and holiday entitlement for working Sundays. They also provide for paid paternity, adoption and bereavement leave.
  The provisions of the wages boards are certainly better for farm workers than the national minimum wage and working time regulations, but it would be wrong to

  1019
  imagine that they have been over-generous to farm workers. It must be remembered that they contain equal numbers of representatives of both farm workers and farmers. The minimum agricultural rate stands at about the same proportion of average male earnings as it did when the current board was established in 1947, and average pay in the agriculture, hunting and forestry sector is still £129 less every week than the average weekly pay in manufacturing.
  If the boards were abolished or weakened, not only agricultural workers would suffer. The board rates are used as a benchmark throughout the rural economy. I understand that the Country Landowners Association has an agreement with the TGWU to recommend to all its members that they pay their staff the AWB rates. Furthermore, if farm workers receive less pay, it will mean more rural social exclusion, less money spent in the rural economy and a greater cost to the state through the working families tax credit.
  The last time the boards were reviewed, the Conservative Government threatened to abolish them altogether. Their intention was clear from the letter covering their consultation document. It said:
  On the basis of its view that statutory wage fixing arrangements distort the labour market and destroy jobs, the Government has already taken steps to eliminate statutory wages controls in other sectors where they exist.
  The Labour Party campaigned alongside the farm workers, other parties and indeed the farmers, to save the boards. We said that we would keep the them. I refer my right hon. Friend the Minister to Labour's general election policy handbook, where she will see the question:
  Will Labour keep the Agricultural Wages Boards?
  The answer given is "Yes." We also knew that it was crucial that the boards were not weakened but that their role was maintained. In our policy document "Reforming the Common Agricultural Policy", we said:
  We see their continuing role as crucial to long-term prosperity within the industry.
  The agricultural wages boards perform a most important service for farm workers, for the agricultural industry and for the rural economy. It would be a great mistake to weaken or abolish them.
  There is a strong case for saying that the boards should be harnessed to do more: I commend to my right hon. Friend the proposal that their scope be extended to cover all workers in the rural economy who currently undertake agriculture-related jobs—gamekeepers, estate workers and so on. She will also be aware that there is a strong body of opinion that the boards should be used to develop a decent occupational pension scheme in the industry.
  I understand that the Government are currently considering their review of the wages boards. I appreciate that my right hon. Friend will not be in a position to announce the outcome tonight, but I hope that she can give us a preliminary indication of her thinking.
  10.53 pm
  The Minister of State, Ministry of Agriculture, Fisheries and Food (Ms Joyce Quin): I am grateful to my right hon. Friend the Member for Edinburgh, East and Musselburgh (Dr. Strang) for initiating this debate. We all recognise his enviably long record in campaigning for improvements in the working conditions and
  1020
  remuneration of agricultural workers. He has taken an interest in those matters for longer than I have been in the House.
  The debate gives me a welcome opportunity to update the House on the review of the operation of the Agricultural Wages Board and the agricultural wages committees. The review obviously includes a review of statutory wage and other employment provisions that obtain in agriculture and horticulture. My right hon. Friend mentioned devolution. I am primarily concerned with the arrangements in England and Wales and my remarks should be interpreted in that context, but right hon. and hon. Members will wish to note that a parallel review of the separate agricultural minimum wage arrangements in Scotland is also being conducted.
  I know that my right hon. Friend is familiar with the history of the Agricultural Wages Board, which has served us well over a long period. It was established in 1924 and has played an increasingly important role in setting minimum rates of pay and other terms and conditions for agricultural workers.
  In the early days, the board, working with the agricultural wages committees, was responsible for fixing minimum rates of pay, overtime rates and the value of payments in kind. The power to fix holidays with pay came in 1938, and the power to introduce agricultural wages sick pay came as recently as 1967. In 1975, the board was given the power to fix other terms and conditions for employment for agricultural workers, and in 1999 we imported the better enforcement arrangement, which was provided under the National Minimum Wage Act 1998, into the agriculture system.
  In looking at the current agricultural wages order, which came into force in England and Wales on 1 June, one can certainly recognise the wide range of issues covered by the board. Those include minimum basic and overtime rates for standard workers, flexible workers, casual workers and several categories of young workers. The order provides a career structure for the industry by setting higher minimum rates for workers with particular qualifications and for workers with special responsibilities. Those relate both to the farming side of the business and to staff management. Workers on stand-by duty, on a day when they do not normally work, or those doing night work, perhaps during lambing or other busy times of the year, are entitled to a prescribed minimum payment.
  My right hon. Friend also mentioned the dog rate. When I first heard of that I wondered whether it was some minimum wage for dogs, but of course, as he said, it is a payment to agricultural workers who are required to keep working dogs, in recognition of the additional costs they must bear.
  The current order deals with rest breaks; additional holiday days for workers who normally work overtime on a Sunday; holidays and other leave, including public holidays; the new service holiday; bereavement, paternity and adoption leave; and the payment of agriculture wages sick pay. Those arrangements help to ensure that agricultural workers are given fair terms and conditions of employment and are treated fairly by their employers. The arrangements recognise, too, that agricultural work is highly skilled, demanding and, as we know, frequently dangerous.

  1021
  Since the election, this Government have made significant changes in the protection offered by general employment law. Those apply to all workers, including those covered by the agricultural wages order. The Government introduced the working time regulations, which place a limit on average weekly working hours and entitle workers to minimum rest periods and rest breaks and to paid annual leave.
  A year later, we saw the introduction of the national minimum wage. There has also been legislation entitling workers to unpaid time off in certain circumstances, and dealing with part-time work. The result is that all workers are much better protected than they were when the Government came to power.
  While ensuring that we protect employees, we have also sought in various ways not to over-regulate businesses—which is important in agriculture as well as in other sectors—and to look at issues of competitiveness. We know that some sectors of agriculture receive particular levels of subsidy from the European Union. Others, such as horticulture, pigs and poultry, have to compete freely, often against cheap imports from countries outside the EU.
  However, a recognition of costs and the competitive factors never justifies exploitation, and it certainly does not justify any illegal activity such as the exploitation of illegal immigrant workers. I make that point because I know that there is interest in the House in some of the activities of gangmasters in the agricultural sector which have been discovered. The Government take those issues very seriously.
  In May 1997, we began work on the issue, investigating gangmasters and their way of operating, and a year later we launched Operation Gangmaster as a way of joining up the enforcement activities of seven to eight agencies covering all aspects of employment law, taxation and benefits. We began that in a pilot area and we are now extending it to six other areas.
  Mr. Alasdair Morgan: The right hon. Member for Edinburgh, East and Musselburgh (Dr. Strang) said that the wage rates set by the Agricultural Wages Board were in excess of the minimum wage under the National Minimum Wage Act 1998. Yet in rural areas, average earnings are very much below average earnings in urban areas. Does that not make the case for the Agricultural Wages Board to be strengthened and for its role to be broadened rather than diminished?
  Ms Quin: In the course of the review, we are considering various proposals, not just in relation to the board's core activities but in relation to related issues. There is at least some evidence that, in rural areas, the agricultural wages committees have the beneficial effect of setting an example to other employers. It is important to take that into account.
  I pay tribute to the work done by the Agricultural Wages Board over the years. It has been well served by the generation of representative members, particularly those nominated by the Transport and General Workers Union, of which I am a member, by the National Farmers
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  Union, and by the independent members. I know that the members on the board have given a great deal of time and thought to the board's work.
  I also know that the board has been quick to acknowledge the recent changes in the general employment law, and that it has taken steps to ensure that there is no conflict between the wages order and the general law. In 1998 and 1999 it made two orders to keep abreast of the changes. This year, the board has brought the holiday provisions as closely into line with those in the working time regulations as possible under the board's current powers.
  The Agricultural Wages Board, like all other non-departmental public bodies, is subject to regular quinquennial reviews. That gives us a chance to take a fresh look at all aspects of the policy and the operation of the current arrangements. I recognise that such reviews can be unsettling, but they have an important role to play in ensuring that Government policy meets current needs, and that the work of those important organisations is regularly reviewed.
  Mr. Roy Beggs: Reference has been made to England, Wales and Scotland, but I am sure that the Minister will agree that the same provisions should apply to agricultural workers in Northern Ireland.
  Ms Quin: Obviously, the principles that we are discussing are important in all parts of the United Kingdom, but I do not want in this debate to trespass on the responsibilities of our good colleague, Brid Rodgers, whom I was pleased to see return to her agriculture and rural affairs portfolio in Northern Ireland.
  My right hon. Friend the Member for Edinburgh, East and Musselburgh made a number of comments to which it is important I respond. In general terms, the results of the consultation process are not wholly surprising. Obviously, the trade unions and representatives of agricultural workers strongly support retention of the board. The NFU has advocated its abolition, while some other employer organisations, and some individual employers have backed its retention, but some have put forward ideas for modifications to the current arrangements.
  My right hon. Friend mentioned the views of the Farmers Union of Wales, which supports the board. On the other hand, the Horticultural Trades Association saw little need to retain it. The Country Landowners Association believes that it serves a useful purpose, although it and the Tenant Farmers Association made some proposals for change. That is a broad-brush account of the response, which contained a great deal of detail and is currently being considered thoroughly.
  An independent research project also examined the impact of the current arrangements on employers and their workers. My right hon. Friend expressed some anxiety about that procedure, but that approach has been applied to at least one review of the Agricultural Wages Board, and to other normal quinquennial reviews. Again, I would not like to suggest that the approach to the review that we are considering was unique. The opposite is the case.
  I understand the desire for an early announcement on the board's future. I recognise the strong belief of many

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  hon. Members of all parties in the work of the board. I know about the recent early-day motion tabled on the subject, which shows strong support from colleagues. However, we want to do the review process justice. I hope that my right hon. Friend and other hon. Members appreciate that the issues that the review raised mean considering a range of social, employment and competitiveness matters.
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  I assure my right hon. Friend and other hon. Members that their points are being given due weight in the current deliberations. I hope to be able to announce the outcome of the review as soon as possible.
  Question put and agreed to.
  Adjourned accordingly at seven minutes past Eleven o ' clock.

Preamble
[SIR ALAN HASELHURST in the Chair]

Organophosphates
Motion made, and Question proposed, That the sitting be now adjourned.[Mr. Kevin Hughes.]
9.30 am
Dr. Ian Gibson: People all over Britain will be waking up today wondering about organophosphates as we debate the subject in this august place. I am sure that we shall impart some information this morning, so that the public know why we take the matter seriously. I welcome the chairman of the all-party organophosphate group to the Chamber. I pay tribute to the Countess of Mar, who has fought a continuous battle and has bombarded Ministers with questions for years. Indeed, she has distinguished herself in that campaign.
The organophosphate group of chemicals causes many problems. They are implicated in the Gulf war syndrome, and they affect agricultural workers. Organophosphates have been the cause of debate in rural communities about their effects on the people who live and work there. The chemicals are the cause of problems in animal welfare, medicine is involved and there are many other aspects to the problem. Indeed, I note that the Sunday papers report that organophosphates can be found in aircraft; not only can one get a pulmonary embolism four days after flying, one can also get a good whiff of organophosphates on the transatlantic flight. That is something for everyone to enjoy.
The subject also creates problems for Ministers. It covers so many areas, and many Ministers have something to say about it. We have got round that problem today by not having five Ministers here. That would have been too much to handle, and, perhaps, too radical. I am pleased that we can concentrate on the agricultural implications of organophosphates and how they affect people's health.
My interest in the use of chemicals in rural communities stems from work that I did some years ago, when young agricultural workers in Norfolk wanted to talk to doctors about impotence and about not being able to start families. That was in the early days of chemical use in the farmyard. Insecticides and pesticides were implicated, because they washed into the Broads and the rivers and fouled up plant life there. We wondered then whether the chemicals could have had some effect on people in rural communities. Although gloves and uniforms were available as a safety measure, I am sorry to say that people had problems with wearing chemical suits to prevent their bodies getting near chemicals. People were found to be using about 20 chemicals a day. We tried to ensure that they took precautions, and many of those young men successfully sired children a few years later.
It was difficult to nail down which chemical could have caused the sterility, and a doubt remains to this day. Because so many chemicals are used, it is often hard
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to find evidence that a particular chemical has caused a problem. I am pleased that organophosphates have been studied and that research has been carried out, but it is sometimes difficult to gain the scientific and medical surety of evidence that is needed to take matters forward.
Organophosphates were first shown to have biological uses in about 1937, and they are now widely used as pesticides in agricultural, public health, veterinary, domestic and medicinal applications. Some organophosphates are used as lubricants and plasticisers. The one thing that is clear, however, is that whenever and wherever they are used, humans are always exposed to them; people come up against them, and take them in through the skin or in other ways.
The organophosphate compounds used in warfare are chemically different. We do not want a chemistry lecture—goodness forbid that. I do not understand chemistry much, anyway. We are not going to talk about the organophosphates said to have had an effect in Gulf war syndrome. They are a different kettle of fish, have different chemical structures and probably work differently from those used on farms.
The use of organophosphates in arable and livestock farming has raised many concerns. People will know especially of the adverse effects on sheep farmers exposed to low doses for long periods while, for example, sheep dipping. Publicity on that subject has come in at a great rate. We also know that it is possible to be affected during crop spraying. It has been suggested that pesticides, including organophosphates, have appeared in water supplies and food. There is much concern about that, and the issue is still very alive today.
Research has shown that many organophosphates work by affecting a key protein or enzyme in the human body, which is involved in nerve function—way in which nerves interact. Brain function and the nerves controlling muscles are affected through contact with the chemicals. Organophosphates are of great use on farms. They are used to eliminate scab disease and they kill insects and plants. They are used around cats' necks to kill fleas and they are used around the home to kill flies, wasps and ants. They are often used in soil to affect living organisms by working through that enzyme. They have a function. Today, however, we are discussing the other side of the issue—the aberrant effects on humans.
It is often asked what the short and long-term effects are. I will not give descriptions using medical terminology, but saying that organophosphates do your brain in might help people to understand. That is how people describe the effects in the media. Organophosphates cause muscular twitching. There can be effects immediately or in the long term on muscle and brain function, memory retention, learning skills and other aspects of life. Chemicals, including lead, have often been shown to affect the intellectual ability of young people in particular, whose brains and cells are forming to function properly in school.
We will no doubt learn much more as research informs us about the way in which the chemicals work. I am sure that different classes of the chemicals will work differently and have different functions. We will have to find a language for describing medically the way in which functions are impaired by different organophosphates.

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There has been much scientific and medical research into the effects of the compounds, both with regard to the Gulf war and to farms. Many reports have been produced by august bodies. The argument has moved forward in some ways, but it has not progressed fast enough. I will illustrate some of the directions in which we might still need to carry out research. The questions being asked about organophosphates concern long-term toxic effects following low-level exposure. That is an area of great debate. There is good evidence that where there is high-level exposure to organophosphates, there are immediate toxic effects on the peripheral nervous system and the skeletal muscle. There is uncertainty about the mechanism of how they work, but there is no real argument that there is an effect on those functions.
As the implications of the human genome project explode around the world and we get more information, we are sure to find that some people are more susceptible to the chemicals than others. That will make it more difficult for us to say that everyone will be affected by organophosphates. It is like an airline that says that it did not create the blood clot on the passenger's lungs because the clot developed four days after the flight. Many delayed effects can happen after the body is subjected to some influence.
It is agreed that OPs have potential long-term effects that justify caution in their use. That is the base line on which we can all agree. There is good evidence, too, for delayed effects. Some effects appear in the short term —a matter of days, weeks or just hours —but exposure to high levels of the compounds can also have delayed effects on the nervous and muscular systems.
An explanation is needed for a range of reactions from different organophosphates. The debate is often clouded by arguments about the difficulty of knowing the extent of someone's exposure to a particular organophosphate. It is difficult to record that information. Studies have been rubbished because of the problem of arriving at figures for the level of exposure, and that compounds the confusion in obtaining evidence that could lead to legislation.
Another problem is defining the effects. Some, such as dizziness and twitching, can always be argued to have been caused by something other than organophosphate exposure. It is hard to tie down such symptoms to a low or high dose of a chemical. Some of the effects that are claimed, such as suicide and depression, are also hard to narrow down to one event in someone's complicated life. There may be multifactorial reasons for those problems. However, when one starts to add all the elements together, a picture emerges. Something is going on with the coming of organophosphates into rural communities and lives.
I am pleased that the Government are investigating ways to increase research. I know that research councils and other bodies are funding research into not just Gulf war syndrome but other aspects of chemical pollution. We need more biochemical research, which raises the question of using animals. I see no other way to obtain the necessary results about the effect on nervous systems and behaviour. We can study the way that mice run in mazes, for example. That is the nearest we can come to
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decent experiments without using human beings. Of course, we can look at tissue culture and ask questions about the enzymes and proteins that are affected and the resulting effects on nerve cells. We can examine brain tissue in post mortems and study the concentration of organophosphates in nerve tissue. We can use electrophysiology to study brain and organ function for the effects of toxic subjection to an organophosphate. At the same time, clinical trials are being conducted —more will be needed —on groups of people who have been affected by the substances, to find out how memory and behaviour develop in the short and long term.
All the research has resulted in many reviews, but the royal colleges and the Medical Research Council tend to focus on symptoms and treatment. The Medical Research Council has gone a little further and suggested in its report that there
may be a correlation between occupations using OPs and learning problems.
The possibility of a correlation is about as far as one gets in this argument. One wonders what one would have to find out to establish a hard and fast link.
It is hard to define, using different studies from different countries, the general phenomenon of good mental health. That makes gathering evidence difficult and accounts for the many disagreements in academic circles. While admitting that there must be some effects from organophosphates, as they are not natural components of the human body, some authorities question their seriousness. They argue that the body has systems for dealing with the many foreign materials in food and that perhaps we can handle a little dose of organophosphate. However, I do not feel that that would ever be good for me and I do not believe that those who work on farms think that it is good for them. That raises an issue relating to those who say that a little new chemistry in the body does no harm.
How should we go about resolving the issues, given that the response to high or low levels of organophosphates is complex? As people agree that high doses can cause immediate, intermediate or long-term toxic effects, the regulations set about minimising those effects by attempting to limit exposure to sheep dipping or crop spraying. Those regulations often involve advising people to wear gloves, and so on. I understand very well why people are not too good at following that sort of health and safety advice. I am sure that every one of us in the Chamber has taken a risk at some time when we know that we should not have done so. I do not just mean by smoking, but when handling things in the home, spraying plants or whatever, because certain chemicals affect the person. Therefore, we have not resolved the problems of chronic and adverse health effects through regulation, and disagreement continues.
Although further research will continue to resolve some of the problems and find better answers so that we can say, "Yes, it does affect the system, so it is no wonder that people are feeling ill", we must have a much more determined approach.
There have been many suggestions about what we should do about organophosphates, especially in relation to sheep dippers. Many people have argued that there should be a moratorium. We have heard about moratoriums in relation to genetically modified crops, which expresses a certain attitude to tackling such

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problems while we do not know much about them. The other argument is to look for alternatives, such as other chemicals that might be less harmful to human beings. Another suggestion is to introduce tighter regulation to ensure that people are protected and that the regulations operate properly. I have spoken about how difficult the latter option is and about how difficult it is to get people to play along. On farms, continuous monitoring would be necessary because activities change daily and are unpredictable; people are in a hurry and so they cut corners. That is sad, but that is the way it is. There are other approaches to dealing with that problem, which I shall not talk about now.
The alternatives have not proved to be very effective. There is evidence that some of the alternatives damage the environment, get into rivers, cause algal blooms and destroy plant life and animal life around rivers. Some people throw up their hands in horror at the idea of a moratorium because they worry about how we would handle the problem of sheep scab. The only answer is that, in some countries where organophosphates are not used, there is no problem with sheep scab, so people argue, "If it all right for them, why is it not all right for us?" That argument is batted back and forth by the warring parties, and we do not seem to move forward.
Science is one way forward, and we are all in favour of good science and understanding things at a deeper level. At the same time, legal cases are pending. Sadly, some of those legal cases are resolved in out-of-court settlements. I say "sadly" because, although I am glad that the cases are resolved, that does not help in bringing cases into the legal system, where other minds and sensitivities can become involved in trying to resolve the problems of people whose health has clearly been damaged by being subjected to such chemicals. I believe that we shall see more instances of that in the next few years. Gulf war syndrome is one such illness that is setting precedents. Farm workers are also bringing forward cases.
We are learning something from Europe —this is something that we have discussed before in the House—from the so-called precautionary principle. That relates to the situation in which 100 per cent. scientific evidence that one thing causes another is unavailable and considers how that situation should be handled until more information is available. I am fascinated by the precautionary principle. I find that there is no definition of the principle in Europe, but there are 14 alternative interpretations of it in Government legislation around the world. I shall mention just two of those interpretations because the principle is relevant in certain situations, and we have used it recently in this country in relation to radio frequency waves for cellular phones and mobile phone bases. In the absence of 100 per cent. scientific evidence, the Stewart report made recommendations to the Government on the basis of the precautionary principle, stating that radiation emanating from phones and bases was causing problems.
In regulating new technologies, whether they are chemical technologies such as OPs or physical technologies such as cellular phones, there must be something in the equation besides science. It is increasingly obvious that public understanding and acceptance that there are problems persuade Governments to take action. For example, the public
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have been extremely influential in fashioning Government policy in the GM debate and we should be grateful for that.
On the precautionary principle, I pick the two extremes that support my argument from the 14 alternatives—I am prepared to elaborate on the other 12, but I hope that no one is too keen for me to do so. When a hazard is appraised, any risk of harm is noted, built into the control measures and taken seriously. If it is assumed that the evidence is indicative of a problem, that will be taken into account in framing legislation. One alternative would be to ban its use, another to limit the exposure but to take it seriously and accept that something is going on, and that what has happened is not an accident or an act of God.
Another view is that there must be reasonable grounds to conclude that there is a risk, although that gives rise to an argument about what are reasonable grounds. Those who support that view believe that there must be a good reason for doing nothing.
The first approach to the precautionary principle is an alternative to risk analysis; it is assumed that something is a problem and that is built into the equation. The second approach is risk analysis. I do not know how people decide which approach to take; to judge from published literature, the second approach is favoured in respect of OPs, but the first approach was taken by the Countess of Mar when she gave evidence to various committees. She is a brilliant advocate of the precautionary principle.
The issue is political as well as socio-economic, and public opinion has a vital role in bringing matters to the attention of Governments. The precautionary principle had to be adopted in the case of cellular masts for mobile phones because Members of Parliament were hammered by their constituents about the issue; people are suspicious about cellular phones, and especially about the masts on school buildings. The OP lobby, although it is laudable, may not yet have been voluble enough to make that kind of impact on political decisions.
In the three years since I have been a member of the all-party organophosphate group, which was formed eight years ago, the balance of the argument on OPs has been swinging towards a ban on their use, and to other methods of handling the problem of sheep, cat fleas and so on. I hope that the debate will support the argument that these harmful chemicals should be eliminated.
I welcome the Government's action on the issue. They are taking it seriously and tackling the problems, unlike the previous Administration. I urge them to take the final step and act to reduce exposure to harmful organophosphate chemicals.
9.54 am
Mr. Paul Tyler: I congratulate the hon. Member for Norwich, North (Dr. Gibson) on securing the debate and on an excellent speech. He has scientific expertise that I, as a layman, certainly do not. That is one of the reasons why he and the hon. Member for Ludlow (Mr. Gill), who is also present, have been such valuable members of our all-party group.
I do not have the scientific background of the hon. Member for Norwich, North, but I want to follow his definition of the precautionary principle in relation to

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long low-level exposure to organophosphates. My simple, layman's translation of that principle is, "If in doubt, don't". I have learned that that principle has not applied in many areas from meeting a huge number of people over the past 10 years who have been exposed to these extremely damaging chemicals.
The focus in the recent past has been on the use of organophosphates in agriculture, but they have a long history and are used in several other ways, both domestically and commercially. I want to consider the use of OPs as a lubricant in aircraft engines. The hon. Member for Norwich, North referred to that subject, but he would agree that it has not received the same attention as the agricultural use. It is worrying that some aircraft that use those lubricants are especially susceptible to problems. One of those aircraft, the BAe 146, is used by the Queen's flight, so the House will recognise that the issue is important. The health of pilots, crew and passengers could be affected.
In its evidence to the current House of Lords inquiry into aircraft cabin environment, the Aviation Health Institute —a reputable body —has admirably summed up the situation. Its document states:
Passengers and crew on some aircraft are being subjected to organophosphates exposure from oil seal leaks into the air conditioning systems. The most common aircraft models involved are Airbus 320 MD-80 and the BAe 146. In the case of the latter, Professor Chris van Netten has demonstrated that filters had sometimes been overloaded allowing fumes to enter the cabin.
It is known that organophosphate pesticides have a significant deleterious effect on the human immune system as well as being a neurotoxin. In the UK the DETR has confirmed that the failure of oil seals occurs in one in every 22,000 flights, resulting in organophosphate exposure. At Heathrow, where there are 440,000 aircraft movements, this could effect 20 aircraft a year or some 2,000 passengers.
That is not a tiny minority. The document continues:
In Australia a senate committee is investigating the neurotoxic effect of BAe 146 and lawsuits are pending in the US and Canada on leakage of organophosphates into aircraft cabins.
I am in touch with the chairman of that Australian senate inquiry, whose report is imminent. He is visiting this country shortly, and I hope that he will have the opportunity to meet others of us who are concerned about the issue.
I find alarming the apparent complacency of the United Kingdom authorities. We have known for some time that those potentially lethal chemicals are used as lubricants in aircraft engines —not only fixed-wing aircraft but in helicopters. I notice from this morning's Hansard that, in the debate about the RAF Chinook crash that took place in this Chamber yesterday, the reason why pilots took the action that they did was not identified. There may be a connection with organophosphates.
Early in 1999, I obtained information from Ministers at the Department of Health and the Department of the Environment, Transport and the Regions. Since then, we have sought assurances about the use of OP lubricants and safety precautions. Last December, I received a disturbing report from Sweden, which stated that, on 12 November, an unidentified toxic gas almost caused a catastrophe in a BAe 146 passenger aircraft operated by Braathens Malmo Aviation. The Minister may be able to correct my Swedish pronunciation, as she is a known linguist.
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On the first leg of a three-part trip, the cabin attendants felt strange and experienced incredible pressure. One attendant described the experience as like a "moonwalk." On the second leg, the discomfort returned, and the two pilots experienced it too. On the third leg, to Sturrup airport, the cabin manager realised that something was seriously wrong, went forward to the cockpit before landing and found that both pilots were wearing their oxygen masks. The captain was so near to blackout, in his words:
feeling dizzy and groggy despite the oxygen
that he had instructed the first officer to take over the controls and land the plane.
The Swedish board of accident investigation, the airline and the aircraft engine manufacturers all treated the incident as very serious, as well they might. The initial investigation pointed to a leak of a potentially toxic engine lubricant. I was anxious to establish whether that was an OP. We already know that they were originally intended only for helicopter engines, which operate at relatively low altitudes—therefore without the air pressure problems —and at lower speeds.
That incident and others have been drawn to the attention of our Ministers, but there seems to have been no effective analysis or dissemination of information to warn aircrews and passengers. In evidence to the House of Lords, the British Air Line Pilots Association writes:
Our concerns have been raised with both the CAA and the DETR, however, their response was that any such contamination could be controlled by either isolating the air conditioning unit or shutting down the affected engine. This action, however, can only be taken after exposure has occurred and this would be experienced by not just one or two individuals, but possibly all of the passengers and crew.
Due to the flight safety issues raised by the symptoms of exposure such as disorientation, blurred vision, impaired memory and altered coordination, attempts have been made to address these problems worldwide. These include changes in design, maintenance and operation procedures. However, while the problem persists, exposure of staff and the public to levels of toxicants that may affect safety and health continues.
Despite the flight safety issues and health risks associated with the use of toxic compounds and reported incidents of cabin air contamination, neither the Industry nor Government has fully investigated this issue. We, therefore, feel that the use of these substances should be investigated and reconsidered.
I apologise for reading a long extract from that evidence, but I think that hon. Members will agree that its influence and importance are considerable, as it comes from such an authoritative source.
However, Ministers still show the most extraordinary and breathtaking complacency. As long ago as last December, I asked the Ministry of Defence and the Department of the Environment, Transport and the Regions to investigate the implications of the BAe incident. A Minister from the MOD replied:
We have no record of any recent military aircraft incidents relating to the use of organophosphate lubricants. The organophosphate compound tricresylphosphate is present in almost all military aero-engine lubricants and, as no viable alternative products are available, appropriate measures are taken to avoid the exposure of air and ground crew to any potential health hazards. We understand that BAe systems is investigating the incident involving a civil BAe 146 aircraft on 12 November and we will consider any recommendations that emerge.—[Official Report, House of Commons, 20 December 1999; Vol. 341, c. 363W.]

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I will not repeat the DETR's answer, because other hon. Members want to speak, but I hope that they will accept that it is similar. Again, acute exposure high-level dosage is mentioned, but there is no recognition of the damage that can be caused to human health by low-level exposure over a long period.
What conclusions have been reached? It is now many months since the incident, and presumably there has been at least an interim report. What advice has been given to airlines that operate those planes or, indeed, those who operate the Queen's flight? Are there maintenance or flying instruction implications? Who knows? Ministers continue to disclose the minimum of information. I have again questioned them and received equally sketchy answers. I tabled written questions to ask the Secretary of State for Defence and the Secretary of State for the Environment, Transport and the Regions whether their reviews of the incidents involving possible organophosphate air pollution on board aircraft had reached conclusions. On 13 June, the Minister for the Armed Forces said:
We have no evidence of organophosphate pollution on military aircraft affecting personnel, but we will consider carefully any conclusions from an on-going BAe Systems investigation into an incident involving a civil BAe 146 aircraft last year.—[Official Report, House of Commons, 13 June 2000; Vol. 351, c. 564W.]
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Sunderland, South (Mr. Mullin), said:
The investigation of these incidents is still under review. The report will be published following its outcome. I am unable to comment until that stage has been reached.—[Official Report, House of Commons, 13 June 2000; Vol. 351, c. 555W.]
The emphasis is on allowing the commercial operators or manufacturers of the aircraft or the engines to do their own research. It worries me that there is no sign of any external, objective and authoritative analysis of that incident.
In the meantime, I have received an interesting letter from BAE Systems. It does not deny any of the information that I have related, but, in a revealing phrase, it claims that the implication in a recent report that the issue is specific to the BAE 146 is inaccurate. In other words, other craft may be involved. Two wrongs, let alone 2,000 wrongs, do not make a right. There was no attempt to suggest that the media or those directly involved as air crews had encouraged the concern. BAe Systems accepted that a problem exists. Of course, it, too, awaits the outcome of the Swedish investigation.
As the hon. Member for Norwich, North said, official research reports dating back to the 1950s identify OPs as potentially extremely dangerous toxic chemicals. In concentrated form, they have been proved to have acute effects on human health. Low-level dosage over long periods is still being investigated, and I, too, pay tribute to the Government for accelerating such research in the past three years. There is widespread evidence of chronic effects in at least a substantial proportion of those exposed to OP vapour.
If the legal and official inquiries produce firm evidence that the health and safety of aircraft crews and passengers are being risked regularly by exposure to toxic fumes, the consequences will be far-reaching. This summer, tour operators, those responsible for military aircraft and perhaps the officials responsible for the
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Queen's household should be made aware of the facts. I hope that as soon as the current investigations are complete, the Government will produce a full report.
Investigations by the OP Information Network, an extremely effective voluntary organisation which has done much pioneering work, have revealed a hiatus at the heart of the Government. The Department of Health, the Department of the Environment, Transport and the Regions, the Health and Safety Executive, the Environment Agency and the Civil Aviation Authority do not accept responsibility for threats to human health once an aircraft has left the ground. People are on their own. A request that the application of the Control of Substances Hazardous to Health Regulations 1999 be checked has remained unanswered.
The OP saga remains a chronicle of disinformation, dither and delay over many decades. The continuing failure of the United Kingdom authorities to insist on a withdrawal or moratorium on the use of OP products until they are proved to be safe will expose Ministers to renewed claims for compensation. Meanwhile, as the hon. Member for Norwich, North said, research at Imperial college London, and University college, London shows new evidence of damage to human brain and nervous systems, even from long-term low-level exposure to OP sheep dips. The many victims are now asking, "When will Ministers ever learn?"
10.9 am
Mr. Christopher Gill: As a fellow vice-chairman of the all-party group on organophosphates, I congratulate the hon. Member for Norwich, North (Dr. Gibson) on having obtained this important debate.
I also congratulate the hon. Member for North Cornwall (Mr. Tyler), who was the driving force behind the formation of the all-party group. I should like to voice my appreciation of all the time, effort and sheer hard work that he has put into the topic over a long period. It is rare in this place for compliments to be handed across the Chamber, but I would like to give credit where it is due, and he deserves some recognition for his work on this issue.
The hon. Gentleman spoke about OP use in relation to aircraft, and I am sure that hon. Members were interested in what he had to say. I will confine my remarks to OPs in the sheep industry, of which I have first-hand experience. Colleagues will recognise that the sheep industry is valuable and important in the Ludlow constituency.
Based on my experience and from talking to many farmers, I can say that a generation of farmers, shepherds and others involved in sheep dipping were totally unaware of the risks of using organophosphates for a long time. Although it might be feasible for the Government to claim that individual users of OPs should have taken greater steps to satisfy themselves that they used materials safely, the investigation of the past few years has shown that successive Governments have failed to impress the dangers on the users. To this day, it is emphasised that the user should take all reasonable precautions and, for example, read the instructions on the label. I shall describe in a moment how the guidance is not practical and has not had the desired effect. I shall mention some cases of people in my constituency affected by OPs.

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As an officer of the all-party OP group, I welcome the decision made by the Ministry of Agriculture, Fisheries and Food in December to put a temporary ban on the production and sale of OP sheep dips, pending the industry designing safer containers. I was surprised at the reaction of the National Farmers Union, which I gathered from the farming press was critical of Ministers' decisions. I understand why; there is no question but that OP sheep dips have been efficacious and relatively cheap. If a product that is effective and cheap is taken off the market, sheep farmers and their profit margins ߞif they have any —will obviously be affected.
I have received no representations from the NFU or individual farmers to say that the Government were wrong to make that decision. That puzzles me somewhat. I would have expected some of my sheep-farming constituents to approach me, knowing my involvement in the all-party group. The fact that I have received no such representations suggests that the majority of sheep farmers, at least in my constituency, recognise that the decision may have been right and understand the serious effect of the chemical on the health of their colleagues.
I shall quote three examples: first, the case of Mr. Evans of Lydbury North who kindly convened a meeting of farmers in my constituency who had various tales to tell about OPs. Mr. Evans believes that his health was impaired as a result of using organophosphate sheep dips, and one of his greatest difficulties was that the medical profession refused to accept that. For a long time, doctors said, "You have all the classic symptoms of Parkinson's disease. Go away and do not trouble us again." That is a common experience. One of our problems in the industry has been persuading general practitioners and others in the medical profession to accept that the symptoms displayed by sheep farmers are more likely to have been caused by the use of organophosphate sheep dips than by more conventional, recognised diseases or illnesses.
Another case involves a constituent who drank from a work mate's pop bottle on a very hot day. Unfortunately, the contents were not pop but sheep dip, which had been bottled by the farmer for use on another occasion. That case, which will shortly come to court, is technically sub judice, so I shall say only that between drinking the contents of the bottle, which my constituent thought was pop, and his life being saved in hospital a few hours later, technically the man "died" several times, because the effect of concentrated OPs on the human body is dramatic and devastating.
My next case concerns a constituent who suffers from a condition caused by low dosage absorption of OPs over a long period. The man ran a pregnancy testing service for sheep farmers. He went round farms testing the ewes to see whether they were in lamb, which helped the farmer to decide on their nutritional requirements. They need less feed if they are not in lamb and more if they are carrying twins or triplets.
My constituent operated the sheep pregnancy testing service for 10 or 11 years until he began to feel unwell. He concluded that he became ill as a result of his contact with sheep, especially their nether regions, to which the
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sheep dip migrates. The man possibly never saw the sheep dipped because he would be carrying out the pregnancy testing at a later, indeterminate stage. It is unlikely that he ever saw a tin of dip with the instruction on the label that Ministers are keen to tell farmers that they should have read. That man was not technically a sheep farmer or a shepherd, but he was closely involved in the sheep industry. He is convinced, as I am, having heard him speak about his experiences, that his health has been impaired because of his provision of that service.
As the hon. Member for Norwich, North has said, organophosphates potentially affect the human body in all sorts of ways. They are obviously invasive of the nervous system and there is no doubt that they affect memory. They cause intolerance to alcohol, affect muscular processes and, as the hon. Gentleman said, lead to mental health problems. There is circumstantial evidence that such health problems lead many farmers and shepherds to take their life.
People suffering from the ingestion of OPs are shy about telling others about another aspect of the symptoms. The chemicals can affect libido. Such people might not feel quite themselves. I was going to say that they might feel under the weather, but that would take us back to the pregnancy tester. Naturally, someone in that situation would not want to tell their family and local community that they had lost their sex drive. He might be thought to be rather an odd fish. We are considering just the tip of the iceberg. For that reason and others, there is great reluctance among people affected to declare their concern about the use of organophosphates.
Has the Government's reaction to OPs been proportionate? How does the action taken compare, for example, with the action on BSE or CJD? As the hon. Member for North Cornwall said, it appears to many people that there has been complacency on the issue, even though there has been so much circumstantial evidence suggesting that people's health has been seriously impaired by the use of the chemicals.
10.23 am
Dr. George Turner: I congratulate my hon. Friend the Member for Norwich, North (Dr. Gibson) on introducing the debate on what is an important topic for me and my constituency because organophosphates are produced in King's Lynn.
As ever, my hon. Friend has given a balanced view of the topic. However, that is not always what we find in the media. I have been made especially aware since my election of the dangers of hype and of what I refer to as junk science. For their own reasons, the media, businesses, politicians and individual scientists sometimes wish to use faulty scientific data and, in particular, to group together chemicals that should not be grouped together. I would like to make it clear that I do not want to argue with the need for caution or that some organophosphates are not dangerous. We must not conclude that we should be frightened of using chemicals because some are dangerous, but we must be careful to act on real evidence and not to be pushed or harried by exaggeration into actions in our role as regulators that are detrimental to the wider interests of not only agriculture, but all our constituents.

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This morning's debate is timely because the product that is made in King's Lynn has been in the international news. In the United States, the Environmental Protection Agency, through agreements with Dow Chemical Company, has introduced changes to its regulations, which remove the single most used insecticide from the domestic market in the US and restrict its use in agriculture. I was aware that chlorpyrifos was part of an insecticide named dursban, which has been produced in King's Lynn since 1978. Last year, as a result of scare stories, I checked what was made at Dow Chemicals and looked at some of the chemicals' properties.
Chlorpyrifos is not emitted into the air during manufacture. It has low vapour pressure, and I was assured that there is no danger to those who work in the plant or to the local community from the manufacturing process. It is not listed as a human carcinogen. Extensive tests are required around the world, including in the US and Europe, and the tests for carcinoginicity, mutagenicity and teratogenic activities were all negative. Therefore, I have no concerns about my constituents who live or work near or at the plant. However, like all hon. Members, I am anxious that we should heed good science and protect consumers.
The announcement was made in the United States on 6 or 7 June. On 9 June, a press release was issued by a pressure group in the United Kingdom,
demanding that Britain follow the American lead and bans the dangerous pesticide chlorpyrifos, which has been associated with brain damage…UK consumers are regularly exposed to this chemical in their diets.
The press release quotes documents from the Ministry of Agriculture, Fisheries and Food as saying that the chemical has been found in apples, grapes, strawberries, oranges and celery. It goes on to say,
New research by the US Environmental Protection Agency has shown that it can cause brain damage in rats.
The pressure group comments:
This filthy pesticide should be taken off the shelves at once. If it's too toxic for the US, it's too toxic for us. Next week is Food Safety Week —the Government will be telling people how to prepare their food safely. But the Government has to set an example —and make sure that food is grown safely in the first place.
That sort of press release is not untypical of pretty junky science. I took the trouble to look up some of the original documents to see what was said in the press reports and by scientists about the decisions taken in the United States. I also looked at the summaries of the pesticides monitoring data published by MAFF to see what was actually said. The fear expressed in the press release is that people are regularly exposed to the chemical, are finding it in their fruit and that it must be taken away.
The independent chairman of a working group on the subject said that it was not possible to detect the pesticides in almost 99 per cent. of the samples examined. The legal limits are set so as to include large safety factors. The chairman said that none of the residues that exceeded those limits were high enough to cause concern. He said:
The extremely small proportion of samples which exceeded the legal limits would not cause harm to consumers.
Similarly, it has been said that the results show that consumers would be at negligible risk from the small proportion of samples where maximum residue limits
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were exceeded. Of course, samples that show that the legal limits have been exceeded are cause for concern, but they are not necessarily cause for panic if we have gained efficacy in the product. The reason that such products have been used for 30-odd years is that they are known to be efficient.
In looking at the US decision, I was particularly interested in an article in The Seattle Times by William O. Robertson, who was head of the Washington poison control centre for 30 years. He explained that he did not recall a single incident of dursban-caused illness. He went on to explain that that chemical was withdrawn because safety factor was piled upon safety factor. The US Environmental Protection Agency decided that it would not use human test data; it was thought to be ethically unacceptable. It decided instead to base the safety factor on animal doses. It worked out the dose that seemed to cause an effect on the animal, multiplied it by 10 for safety and then by a further factor of 10; it also took account of the size of the animal compared to humans to allow for the possibility that we might be more sensitive than the animal, and then added another factor of 10 because children might be involved. That is a safety factor of 1,000.
I know that time is pressing, Mr. Deputy Speaker, but I want to balance the argument. I accept the precautionary principle, but I want to add a little common sense. A safety factor of 1,000 is leading to the removal of goods from the shelves. That may be correct, and I am happy for our regulators to consider it, but we should not automatically assume that we need a safety factor of 1,000 between what the tests show to be harmful and what we allow. There is room for debate.
For instance, I shall consider the precautionary principle in relation to the poison that I know best —alcohol. If we tested how much alcohol could be given to a dog before it became affected and then applied a safety factor of 1,000, I would not be allowed even a teaspoon of beer. That is not reasonable, because we have thousands of years of experience of alcohol. The precautionary principle depends on a degree of ignorance. It might be argued that, because children are damaged in motor vehicle accidents and exposed to risks on the roads, we should introduce a further factor of 10 as a precautionary principle and reduce the speed limit on motorways to 7 mph.
A balancing act is needed. I hope that the Government will take it seriously. Of course we must listen to what science has to say, but we must use a modicum of common sense in balancing efficacy against knowledge. We have 30 years' experience. I hope that the Government will distinguish between chemicals, consider the evidence and not be bulldozed into making decisions across broad spectrums because of the trash science that we too often read in our media.
Several hon. Members rose—
Mr. Deputy Speaker (Mr. Frank Cook): Order. I appeal to the remaining speakers to take account of the reduced time left for Front-Bench spokesmen.
10.34 am
Mr. Colin Breed: Successive Governments have shown a remarkable unwillingness to act on any sort of precautionary principle in the

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handling of OPs. Indeed, as early as 1951, it was recommended that dye be added to organophosphate sheep dips to enable farmers to identify splashes, and that labels reading "Deadly poison" be used. What we are talking about has been known for a long time.
I believe that OP sufferers have gone for years without being properly diagnosed. General practitioners and hospitals have received little guidance in diagnosing the symptoms, and many victims have been diagnosed with different problems, such as myalgic encephalomyelitis or Parkinson's disease. It is only recently that, following the report of the Committee on Toxicity of Chemicals in Food, Consumer Products and the Environment and the recommendation of the Veterinary Products Committee, it has been decided to ban OPs pending the improvement of their containers, to prevent exposure to concentrate.
At present, no one is really winning. Farmers are suffering because of sheep scab in their flocks while OP dips are banned. More importantly, they suffer ill health after years of inadequate precautions. There seems to be no doubt that OP sheep dips are dangerous and toxic. Surely, all the evidence that has been available for some time is sufficient to conclude that the precautionary principle in some form—and I accept that there are various forms —demands protection for all those who work with OPs as well as substantial Government support for the development of alternative, and less risky, methods of preventing sheep scab in particular. Like many of my colleagues, I was a little disappointed by the failure of the Agriculture Committee's report to expose the area of need that I have outlined. By focusing chiefly on the containers issue, the Committee has deflected attention from the crucial need to investigate alternatives.
The Government have sought to deny any risk, claiming that most of the people in contact with concentrates such as OPs would have been environmental health officers, technicians or individual regimental hygiene duties personnel, who are appropriately trained in procedures and the use of equipment. However, it is clear that many people use OPs without that training and without an understanding of the precautions that are needed. Indeed, an answer to a recent parliamentary question stated:
there is currently no reason to believe that Gulf veterans who might have been in casual contact with dilute pesticide…or with the malathion dust used to de-louse Iraqi prisoners of war, are at increased risk of long-term ill health. —[0fficial Report, House of Commons, 20 January 2000: Vol. 342, c. 536W.]
Surely, however, the crucial word in that passage is "currently". Constant use of such language leaves the door open. The scientific jury is clearly out, and there is a need at least for further investigation of such poisoning.
What all kinds of sufferers want is real action by the Government. I have three quick suggestions. First, we should clearly and immediately adopt the precautionary principle, and Government policy should in every way possible take account of the lessons of the past when insufficient precautions have been taken. Secondly, we should undertake a scheme properly to assess the risks associated with OPs. Those are jumping up in all sorts of areas, such as aircraft lubricants, as mentioned by my hon. Friend the Member for North Cornwall (Mr.
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Tyler). There are all kinds of ways in which OPs can become a part of people's lives without their knowing about it. Thirdly, I am concerned about funding for research and development. We heard earlier about the genome project. The money available to investigate that was enormous. That is because of the enormous commercial benefits. Research and development today seem to be driven more by the commercial benefit imperative than by some other considerations such as the health of people who come into contact with chemicals.
Mr. Lembit Opik: Will my hon. Friend give way?
Mr. Breed: I am afraid that I do not have time.
10.39 am
Mr. Malcolm Moss: I shall be brief, to allow the Minister time to respond. I add my congratulations to those already given to the hon. Member for Norwich, North (Dr. Gibson). This is an important debate and he has given a comprehensive presentation on this problem.
It is no surprise to me that the Minister of State, Ministry of Agriculture, Fisheries and Food is responding to the debate. However, the issue straddles more than one Department, and the need for co-ordination between Government Departments is one message that has come out of the debate. The matter should be addressed from several different angles, not only from the MAFF perspective.
I shall restrict my comments to the MAFF decision taken in December 1999 and announced through a written answer in the Lords to withdraw all organophosphate sheep dips in response to fears that the chemicals posed a danger to human health. We should be clear that the ban is not a blanket ban on OP dip chemicals, but a withdrawal of the OP dip containers. The Government appear to be saying that OPs will be reintroduced when the containers have been redesigned to minimise operator exposure to OPs. Many anti-OP campaigners, including the Pesticides Trust, welcomed their move, as have most of this morning's speakers, but the general reaction from the agricultural community has been more hostile.
Many livestock producers believe that OP dips are the most effective means of controlling common ectoparasites on sheep, such as scab and blowfly. The alternatives are all problematic owing to lack of effectiveness, expense and time restrictions on releasing treated animals into the food chain. The main alternatives are synthetic pyrethroids, greater use of which is likely to increase resistance to parasites.
Farmers are concerned about their animals' welfare and fear the effect of worsening animal welfare on their livelihoods. Although parasitic infection may not cause premature death, there is a direct read-across from it to rate of maturation, the value of by-products such as sheepskin and increased veterinary expenses. The greatest fear is of an outbreak of scab. The hon. Member for Norwich, North said that there was little sign of that at the moment, but the use of illegally held stockpiles of OP dips may be keeping such an outbreak in check.

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Although farmers are primarily concerned with the animal welfare consequences of withdrawal of OPs, concerns have also been expressed about environmental consequences. The problem lies in the lack of suitable alternatives to OPs. The Environment Agency, which monitors pollution levels in watercourses, warns of a much greater risk of groundwater pollution from the use of synthetic pyrethroids, which are the main alternative to OPs for sheep farmers. Those chemicals are 100 times more toxic to aquatic life than OPs, and pose a particular threat to invertebrate creatures that sustain larger aquatic animals such as salmon.
The Agriculture Committee report was critical of the Government and took MAFF to task over its handling of the decision. The Committee said that
much of the confusion surrounding the announcement of 20 December could have been prevented if more effective procedures had been in place for consulting manufacturers, farmers' representatives and statutory agencies and for disseminating advice and information after the decision had been made public.
The Committee was also clear about the consequences of the Government's actions, stating:
We remain concerned that users of sheep dips are without their preferred means of combating sheep disease for the foreseeable future and there are likely to be severe economic, environmental and animal welfare implications as a result.
Mr. Richard Livsey: Does the hon. Gentleman not agree that the horns of the dilemma are that either the chemicals used seriously damage human health or they devastate the environment? Should not objective, non-commercial research be carried out to produce new products as soon as possible to overcome both those problems?
Mr. Moss: The hon. Gentleman makes a good point, but the Government are not saying that at the moment. They have acted merely because doing nothing would not have been acceptable. There are no real alternatives to OPs apart from pyrethroids. Research, not least into the effects on human health, is important in regard to every aspect of OPs.
I wish to ask the Minister several questions, some of which she might not be able to answer today; if not, I would welcome answers in writing. First, why did not MAFF Ministers consult more widely before announcing the ban on OP dips? Which organisations did the Government consult in the months between receiving the report from the Institute of Occupational Medicine and making their decision to withdraw OPs? Does MAFF have any contingency plan in the event of a major outbreak of scab occur? If MAFF intends to reintroduce OPs, will it publish a timetable for that? What advice will MAFF give farmers on alternatives to OP dips? Why did not the Government consider the environmental impact of OP withdrawal before making their announcement? Finally, will the Government accept and implement the recommendations of the Agriculture Committee?
10.46 am
The Minister of State, Ministry of Agriculture, Fisheries and Food (Ms Joyce Quin): I am pleased to respond to the debate, which is on a subject of interest and concern to many people. I begin by emphasizing
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that the Government take those concerns seriously. Two years ago, we initiated the most rigorous and transparent scrutiny of OPs ever undertaken.
I appreciate the way in which the debate has been conducted, beginning with the balanced introduction of my hon. Friend the Member for Norwich, North (Dr. Gibson). He pointed to the wide-ranging nature of the debate and said that the concerns that have been expressed relate to a number of different Departments. I do not accept the criticism of the hon. Member for North-East Cambridgeshire (Mr. Moss), who speaks for the Opposition on such issues, that we do not have a co-ordinated approach to the matter. The Government set up an official group on OPs, which is co-ordinated by my department and which reported in June 1998. Since then, all Departments with an interest have been involved —the Ministry of Defence, the Department of the Environment, Transport and the Regions, the Health and Safety Executive, the Cabinet Office, the territorial departments and so on. We are anxious to ensure co-ordination on the issue, different aspects of which come under the responsibility of different Departments, and to ensure that the matters are properly considered. The existence of the all-party group helps in that respect because it offers a way of bringing together interested members from all parties who may be interested in different aspects of the issue —that has certainly been reflected in the varied contributions that have been made this morning.
We all know that OPs are toxic chemicals, acute exposure to which has ill-health effects. The question that needs to be answered is whether long-term exposure to low levels of OPs has similarly detrimental effects —a point that was made by my hon. Friend the Member for Norwich, North in his introduction. It is the question that we put to the Committee on Toxicity of Chemicals in Food, Consumer Products and the Environment —COT—in 1998. It set up a working group of the best specialists in the field, which took evidence from those with an interest in the problem, including representatives of sufferers' groups. Its report was published last November. It concluded that ill-health effects from prolonged low-level exposure to OPs remained unproven, although there is still a question about whether a small group of individuals may be especially susceptible to OPs.
The three regulatory committees that advise the Government on the subject are the Veterinary Products Committee, the Advisory Committee on Pesticides and the Committee on Safety of Medicines. We asked them to consider the implications of the report. They all advised that, on the basis of current scientific knowledge, there should be no general withdrawal of OPs from the market. However, they endorsed the need for further research to tackle the identified points of uncertainty.
Simultaneously, the Veterinary Products Committee advised us on the results of a three-year study by the Institute of Occupational Medicine in Edinburgh into sheep dippers' exposure to OPs. It suggested that the greatest hazard arose when handling the concentrated dip.
We took immediate action to implement the committees' advice through a four-point plan. First, marketing authorisation holders were required to withdraw all OP sheep dips from the market pending the

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introduction of modified concentrate containers designed to minimise the risk of operator exposure. Secondly, we revoked the approval for three OP pesticide compounds for which data packages had not been submitted as part of the review on OPs by the Advisory Committee on Pesticides. Thirdly, we implemented measures to promote best practice and, fourthly, we are developing a targeted research programme to implement the research recommendations of the committees. The importance of research was rightly emphasised by several hon. Members in the debate.
Many views have been expressed. The hon. Member for North-East Cambridgeshire mentioned the report of the Select Committee on Agriculture. The hon. Member for Ludlow (Mr. Gill) referred to concerns in his constituency and to his contact with the farming community, especially sheep farmers. He signalled the fact that there has been a mixed reaction to the Government's decision. Some people have supported it, but we know that the National Farmers Union did not welcome the procedure or the substance of the decision. Nor did other organisations such as the National Sheep Association.
Hon. Members will be aware of the views that were expressed to the Select Committee on Agriculture. It concluded that, although it did not want to dismiss the sufferings of those whose ill health had been linked to OP sheep dips, it would be of general benefit if OP sheep dip concentrates were restored to the market in suitably designed containers as soon as possible. It is fair to say, therefore, that many different views have been expressed on the subject. It is the Government's responsibility to listen to representations and to act on the basis of our scientific advice, which we have done. However, I would not underestimate the complexity of some of the issues involved, and my hon. Friend the Member for Norwich, North did not do so either.
Mr. Öpik: As a member of the Select Committee, I want to remind the Minister that the view expressed in the report was mainly based on the fact that at present no alternative product balances the interests of preventing sheep scab and not wrecking the environment.
Ms Quin: I understand the hon. Gentleman's point. Some products are used as alternatives; the hon. Member for Ludlow spoke about their cost and efficacy and the question of long-lasting effects in controlling the parasites and the relevant diseases. That explains many of the representations that the Government have received.
I understand that hon. Members are concerned to know whether OP sheep dips might return to the market and, if so, when. All that I can say is that we expect to receive further advice from the Veterinary Products Committee shortly, and, in common with previous practice, we shall make an announcement to Parliament before informing the marketing authorisation holders of the Government's decision.
The hon. Member for North-East Cambridgeshire asked several questions that were also raised in the Select Committee's report. Obviously, the Government
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have a responsibility to respond to that report and shall do so shortly. If that response does not answer the questions that the hon. Gentleman asked, I shall write to him and, given the interest that has been shown this morning, ensure that my letter is available in the House of Commons Library.
The precautionary principle was mentioned, and I accept that there is no universally accepted definition of the principle, either domestically or across Europe, where many such regulations are negotiated and agreed. None the less, the authorisation procedures for veterinary medicinal products and pesticides take a generally precautionary approach to risk assessment. The thrust of our precautionary approach is that exposure should be reduced well below the level that might cause problems.
The Health and Safety Executive evaluates the practicality of recommended proportions. Surveys of dipping practice and inspections have taken place, so we believe that there is evidence of improved practice. That is borne out by the fact that the number of incidents investigated has now fallen from its peak in the early 1990s. We must pay tribute to those who expressed concern about the products. Their action brought about some extra controls and extra precautions. As a result, an approach that is generally more responsible has emerged. I would not like to under-emphasise that.
The risk from pesticides was mentioned, and, in that regard, the Government's primary aim is to protect people, animals and the environment. Like veterinary medicines, all pesticides are assessed for safety in use, and no pesticide may be sold or used unless approved by Ministers. All pesticides are subject to routine review if evidence emerges about their safety. In response to public concern, our current domestic review programme has focused on the use of OP compounds.
I shall briefly refer to the research programme that we are undertaking. Hon. Members present, particularly those in the all-party group, are familiar with the research programme, but the hon. Member for Brecon and Radnorshire (Mr. Livsey) asked about research into alternatives to dips, and I feel that neither he nor the hon. Member for North-East Cambridgeshire recognised the work that we are doing.
We are funding a major programme of research into alternative strategies for controlling sheep scab, costing £1.6 million. The projects include basic studies on the biology of the scab mite, aimed at identifying aspects of the mite's physiology that could be targets for alternative control methods. They could include vaccines, fungi pathogenic to the mites, means of altering the allergic response of the sheep or means of interfering with the mite's feeding process. It is important that hon. Members recognise that the Government are focusing on that and are keen to deal with the issue seriously
I welcome the fact that this debate has taken place. Ministers in other Departments who are interested in the subjects raised will be aware of it, but I shall draw their attention to the comments made by hon. Members about the responsibility of other Departments. I hope that, in attempting to answer at least some of the questions that have been asked, I have persuaded hon. Members that the Government are dealing with the issue with the utmost seriousness.

Fraud (European Community)
11 am
Mr. Deputy Speaker (Mr. Frank Cook): We come now to the next issue for our consideration. I call David Michael Davis.
Mr. David Davis: Thank you, Mr. Deputy Speaker, for giving my full title.
The fact that the European Commission suffers from fraud, corruption, incompetence and nepotism is a matter of public knowledge and public record a little more than a year after the pseudo-resignation of the Commission. I say "pseudo-resignation", because it was designed to protect rather than punish the guilty. The pay, perks, pensions and powers of all the Commissioners were maintained until their eventual replacement by the current Commission.
I raise the issue of fraud because of an event that took place before those resignations that makes me worry about the extent to which the European Union takes the issue seriously. A year before those dramatic events at the Commission, the Public Accounts Committee had for the second time raised the problem of fraud in the European Union. The European Court of Auditors had raised the matter more than once. I took part in a debate with Jacques Santer, the President of the Commission at that time, on the "Today" programme. His first response —admittedly, a year before the crisis, but after he had received at least two ECA reports on the matter —was to deny that there was any significant fraud, despite our criticisms and the fact that it had been raised at the Council of Ministers.
Secondly, when that argument failed, Mr. Santer said that fraud was the fault of the member states —that more than 80 per cent. of the fraud related to members states, not the Commission, so the member states should solve the problem. Thirdly, he said that the mechanisms available to deal with fraud were perfectly okay and that OCLAF—the office of the Commission that was supposed to co-ordinate anti-fraud efforts—was doing its job and there was no need to make it more independent. All that was contrary to the eventual findings of the committee of wise men appointed by the European Parliament.
I mention that individual event, because historically the tendency of the Commission and all the institutions of the Union has been to sweep uncomfortable issues under the carpet. I am one of those—perhaps we are in the minority in this Room —who do not believe that we should leave the European Union. We must build a Union that can hold the faith of the public whom it serves. The current Union does not do anything like that. I do not want the Union to be allowed to forget about the problem, so that it returns in five or 10 years' time in an even more unpleasant and virulent form.
I have seen no reference —this may be my fault —in the intergovernmental conference preparations or in the agendas of Feira or for Nice in December to deal with the problems of fraud, incompetence and corruption in the European Union. What are the Government's plans? I, and many others, have no intention of letting the issue be forgotten.
I have several questions for the Minister: first, what immediate action has been taken on the frauds that we know about? Such action is a test of the resolve of this
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Government and of those throughout the European Union to deal with the issue, rather than being a conclusive answer to the problem. Secondly, what reforms will Vice-President Kinnock introduce to resolve the issue, and how speedily will they be made? Thirdly, what further actions will be taken to deal with the issue? Will they be on the IGC agenda in December?
I have my tongue in my cheek when I say "immediate action" because I am basing my comments on data from the 1998 European Court of Auditors report, the most recent one available. It is two years since the matters that we are discussing were aired and three years since the actions were committed. That is an aside, but it has implications for the European Union.
The ECA raised the matter of frauds and irregularities in individual countries; this country was not perfect as there was fraud totalling some £12 million. However, far and away the biggest irregularity was in Italy, where the total reached £106 million, mostly in four major olive oil scandals. As the United Kingdom is one of the few net contributors in the European Union, those scandals cost British taxpayers tens of millions of pounds. The Treasury should therefore take an interest on behalf of the British taxpayer. Was a penalty levied on Italy for the £106-million irregularity? If so, has it been paid?
The second issue raised in the ECA report was a substantial fraud relating to the export of meat to Jordan. A subsidy of £46 million was involved, but it was not really for export to Jordan—it was an embargo-busting operation for Iraq. European Union taxpayers' money was used in defiance of a United Nations resolution and western nations' actions to control the evil dictatorship in Iraq. I want to know whether a prosecution has been brought against those who defied almost every national policy in the European Union and used significant sums of British taxpayers' money to do so.
A third issue in the ECA report was the contract awarded for guarding the European Commission buildings. That is poignant because it was awarded by the security department, which is responsible for protecting the integrity —in every sense —of the European Commission. The contract was found to be fraudulent; it involved ghost workers and criminal false accounting. The ECA report stated that four members of the department would be disciplined and the case was handed to the Belgian police for prosecution. Has that prosecution been completed, and if so has anyone has been punished as a result? As I said, we should bear in mind the fact that the issues I have raised are three years old.
I raised those cases as symbols of how seriously we take the matter. The Chamber will note that one of them relates to a national failure, one to an individual contract, and one to something done by the Commission. I picked them because the way in which they will be dealt with is interesting.
I am also concerned about the strategic reforms that the European Union is undertaking. I should say up front that I approve of the fact that Vice-President Kinnock has been put in charge of the reforms. I might upset my Conservative colleagues by saying that, but he is a tough and honest politician; nobody would deny him that. He knows the European system. Some would

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consider that a vice rather than a virtue, but in this context it is a virtue. More importantly, he knows our system, which is one of the best for maintaining propriety in public life. We are not necessarily alone in that: one or two other systems in Europe are comparable. Vice-President Kinnock does not have to reinvent the wheel in what he is doing in the European Union. He has lived in a system that puts propriety at the top of the priority tree.
However, no matter how good, determined or tough he is, he cannot do the job alone. The Comptroller and Auditor General and the Public Accounts Committee have sought to help him. He will need UK Government support. Sometimes, support takes the form of pushing as well as helping. I will return to that point.
I will focus on the nature and speed of what Vice-President Kinnock intends to do. I disagree with him about the new anti-fraud office. The National Audit Office's staff are not civil servants. They are independently recruited; there might be secondment arrangements, but there is not an integrated career path by which a member of the NAO's staff could look forward to working in, for instance, the Department of Social Security or the Ministry of Defence. That is so for a good reason —it means that there is no social or career pressure on an individual to pull punches in criticising the body that he is investigating. That is not true of the new European Anti-Fraud Office —OLAF. I am not criticising any individual. I do not know the new head of OLAF, Franz-Hermann Bruener, but, as far as I can tell from studying his curriculum vitae, he is well qualified and independently minded, although he has previously been employed by the European Commission in other respects.
Simply being a part of an organisation can make it difficult for an audit body or an anti-fraud body to be as impartial as it ought to be. That situation can render it open to corruption or to pressure. After all, one of the issues that I raised earlier concerned the security arm of the Commission. OLAF should properly have been a completely separate body, accountable either to the European Court of Auditors or to the European Court of Justice. I am concerned about the situation, especially because the pressure to prevent that from happening came from two sources. Surprisingly, it came not from the Commission in the first instance. Instead, it came from the European Parliament—I am afraid that there is no surprise in that, to put it bluntly —and from the Council of Ministers. What stance did the British Government take on the matter? If we did not support the British parliamentary model and the other best models, most of which come from northern Europe, why not, and what was the logic behind the position? That situation is a flaw in the system. There is supposed to be a superstructure to protect the system, but it will not prevent the pressures about which I am concerned.
Some of what I am about to say with regard to the European Parliament's role might be an important component of possible proposals for the next IGC. A Parliament —certainly our Parliament —is a fierce and largely independent scrutineer of Government, although there are obviously party pressures within it, which I shall discuss in a moment. The European Parliament has a peculiar problem, which is not entirely
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its fault. As a result of the relative power in Brussels, a dependency relationship has developed between the European Parliament and the Commission. The Commission has always been the source of most power. Therefore, if a European parliamentarian wanted to get something done, it was useful to have a contact at the Commission. In a sense, that is sensible politics, but it means that there is not the same separation between the Executive and Parliament as exists in our system—even though we have the Executive within the Parliament—when challenges are made over spending, corruption or whatever.
Moreover, no single party is in power, which is a natural outcome of the arrangements in Europe. What tends to happen is that natural alliances are formed between parts of the European Parliament and individual Commissioners, either on the basis of national
origin or, more often these days —perhaps this is a fitting European ideal—on the basis of party. I am afraid that the Minister might find this uncomfortable, but we saw something of that in the affair of Madame Cresson, which led up to the great crisis that produced the change in the Commission. Madame Cresson is a socialist French Commissioner, and there is no doubt that socialist Members of the European Parliament attempted to protect her. I do not hold that against any one party. It is a structural element of the Parliament that right-wing or Christian Democrat parliamentarians will tend to form alliances with Christian Democrat Commissioners, and that socialist parliamentarians will tend to form alliances with socialist Commissioners. That means that the whole concept of having a separate, impartial Parliament is flawed.
Gladstone dealt with that issue by setting up the PAC. To my great benefit today, he ensured that the Chairman of the PAC —the principal scrutineer in Parliament—is a member of the Opposition, who is clearly not a member of the Executive. We might suggest to the European Parliament or to the IGC a series of reinforcements of the budgetary committee of the European Parliament, one of which would be a rotating chairmanship, so that whenever a Commissioner from any party was in front of the Commission, the chairmanship for that session or report would be held by a member of an opposing party; a Christian Democrat in the case of a socialist Commissioner or a socialist in the case of a Christian Democrat Commissioner.
Mr. Mark Oaten: The right hon. Gentleman makes an interesting point, but would he extend that idea to require opposites in terms of the countries from which individuals come?
Mr. Davis: That is a fair point. I have considered that, but have to say that I ducked it because I was not at all sure how it would work with the oath sworn by Commissioners on taking office, in which they undertake to give up all their national affiliations. All of us who have worked in Europe know that the oath is a complete nonsense because Commissioners look to their national origins, but I was unsure whether such a proposal would be at odds with some fundamental part of the treaty. I have not had a chance to re-read the treaty to check that, having read it too many times. However, the hon. Gentleman makes a fair point and I would be inclined to agree that his suggestion would

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reinforce the independence of the budgetary committee. In addition, I strongly believe that we should give the budgetary committee of the European Parliament the right to summon persons and papers—the same right as we have in the House. Over the years, the Government have stressed that the first duty of the European Parliament should be financial scrutiny. We cannot ask it to perform that role unless we give it that power.
Mrs. Teresa Gorman: My right hon. Friend's analysis fascinates me. I am sure that he would agree that the role of independent employees of the Commission should be taken into account, one of whom blew the whistle on the latest fraud. Will my right hon. Friend acknowledge the role of Brian Connolly, who worked in the European Commission treasury department and who wrote a marvellous book entitled "The Rotten Heart of Europe" in which he described those practices? Those who work inside the system should have the opportunity to declare their concerns.
Mr. Davis: I entirely take my hon. Friend's point. Like the hon. Member for Winchester (Mr. Oaten), she has caught me on something that I had decided not to mention, but I shall deal with the issue now. If my hon. Friend will forgive me, I shall focus more on Mr. van Buitenen, because although Mr. Connolly made some interesting points, he would have been in breach of British civil service rules as he was writing about policy matters outside his remit.
Mr. van Buitenen, the Dutchman who blew the whistle, was badly treated. Indeed, his treatment still seems shocking. It does not reflect well on the Commission, the EU or its member states. I believe that whistle blowers should be protected. Vice-President Kinnock's proposals include such a provision, but I would have made it retrospective. I believe that we should compensate Mr. van Buitenen for the way in which he was treated. I would even consider compensating Mr. Connolly, because, even though he was in breach of British civil service rules, the treatment that was accorded him was inappropriate.
The answer to my hon. Friend is yes —I would write that into the IGC. It is an area where the EU has, in my judgment, been in breach of its much-vaunted commitment to human rights. One of the fundamental human rights is not being asked to do something that is immoral or improper; that right was not provided.
My next proposal might shock some of my hon. Friends. I have tussled with the problem at length because I do not believe in giving more power to the EU. It has enough power for the moment, but, in this context, I would give it one more power relating to the budgetary committee. In cases of malpractice, such as those of the past year or two, I would allow it to dismiss a Commissioner. I would not allow dismissal for policy issues or other matters; but for malpractice it is implausible to ask a Parliament to oversee financial expenditure and not to allow it to penalise those who engage in malpractice. I agonised over the issue, but I concluded that if an action was justiciable as malpractice, removal should be available.
The third item of Mr. Kinnock's proposals is not greatly known; indeed, even as a Minister for Europe, I barely heard reference to it. I speak of European staff
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regulations. Hon. Members may not be aware of them, but they virtually have the force of law within EU institutions. They would make our labour laws of the 1970s look progressive. [Interruption.] I have struck a chord with the right hon. Member for Birkenhead (Mr. Field). They limit what can be done when a malpractice is found. The best example is one of the earlier frauds discovered in 1990 by Edward McMillan-Scott MEP, in the tourism directorate, which has yet to be brought to court. If my memory is correct, the sum of £5 million was involved and the people concerned —I cannot call them the guilty people, because we do not know about that, the case not having come to court —are still in receipt of pensions and full benefits from the Commission.
The staff regulations have been an impediment to resolving fraud and malpractice problems all along. The Kinnock reforms, the timetable for which I have before me, and which, incidentally, incorporate the whistle blower protection that we discussed earlier, do not even involve consultation on the question of proposed changes to staff regulations until the first quarter of next year. It is not proposed to bring those reforms of staff regulations before the Council until the end of next year. The earliest point at which we could conceivably obtain a change to one of the most fundamental impediments to proper management of the Commission would be four years after the crisis that led to debates such as today's. That is altogether too slow. Why is there such a delay? If the Government do not agree with it, will they do something to speed matters up? Given that there has not even been any consultation for a year, the problem is clearly not one of negotiation or proper practice. It is more a problem of failing to make the issue enough of a priority.
The European Court of Auditors pointed out that many of the problems that we are discussing arise because the European Union tries to do too much. The worst example of that —the Cresson failure—demonstrates that the lesson has been completely ignored by the current Commission. The European Commission Humanitarian Office —ECHO—was the site of the worst of the problems exposed a couple of years ago. Hundreds of millions of ecus or pounds were improperly accounted for. We do not know that they were fraudulently disposed of, but we do not know where they went, either. However, we know that at least one contract, for —2.4 million, was completely fictitious; there was no other contracting party. The money was being leached out of the system to be used at the discretion of various members of the Commission. That arose directly from the fact that the European Union was trying to do too much and had created a culture of going around the rules. Perhaps that might be done in the first instance to achieve worthwhile aims, but from then on the rules become irrelevant. The barrier against malpractice, fraud and criminal activity then vanishes.
What I have described happened a few years ago. What is happening now? Only six weeks ago, Chris Patten made some cogent comments about his directorate of the Commission. He showed that staff are trying to spend two, three or four times as much money as would be normal in an international development department. That led our Secretary of State for International Development to describe the European Union as the worst aid agency in the world. I do not

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often agree with her, but she has a point. As Mr. Patten said, it can take as long as nine years for it to fulfil a promise. To a Nicaraguan whose home has been swept away by a flood or an African peasant whose family is dying in a famine, nine years is eternity.
The issue is not simply one of fraud, but one of people dying because of our incompetent system. What Mr. Patten has talked about shows that we still have the same problems as we had two or three years ago. He has come up with 23-point plan to try to spend the money that he has. Having looked at that plan, I have no confidence that it will stop any fraud whatever. Mr. Patten talks about relocating decisions to EU posts around the world—which, invariably, will mean less control —and a series of things of that nature, none of which will resolve the problem of fraud. That is a serious weakness in the system.
I have no confidence that we have made any progress. The lesson of the Cresson behaviour was learned, namely that the European Union should do less and do it better. As long as the EU focuses more on politics and promises than on good management and delivery, two things will happen: on the one hand, British and other taxpayers' money will be wasted and, on the other, the reputation of the European union will go down. That cannot be a good thing, whatever one's view of the EU.
11.31 am
Mr. Edward Leigh: It is a great honour to follow my right hon. Friend the Member for Haltemprice and Howden (Mr. Davis) both as a friend and as a member of the Public Accounts Committee, which he chairs and on which I am honoured to serve with him. As always, my right hon. Friend has done a great service to Parliament in the way in which he presented his speech.
I am happy to speak on the issue because agricultural fraud has had a major impact on my constituency. I shall return to that in a moment. Of course, no one really knows how much fraud there is in the EU as, by its very nature, it is impossible to quantify. Klaus Tiedmann of Freiburg university in Germany thought that it might be anything between 7 and 10 per cent. of the total EU budget. If it is, we are talking about very large figures indeed. Needless to say, the European Commission has a far lower figure and says that fraud could be as low as 2 per cent. However, even the Commission acknowledges that the cash figure is much higher than the EU's reported figure, which is based on auditing agricultural spending exclusively. By any measure, the problem is enormous and costs all of us who live in Europe a very large sum indeed, which is why our debate is important and timely.
My right hon. Friend dealt with some of the major scandals that have afflicted the EU over the past 10 years. He mentioned that our colleague, the Conservative MEP Edward McMillan-Scott, detected the tourism fraud which amounted to some £3 million. As my right hon. Friend said, we are still waiting for that to come to court. In November 1995, the Court of Auditors refused to certify the EU's annual accounts on discovering that nearly £3 billion was not properly accounted for. My right hon. Friend mentioned that, in
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early 1998, the Commission's anti-fraud unit revealed that some £600 million of its humanitarian aid budget between 1993 and 1995 could not be accounted for, of which £1.5 million had been intended for refugees from the genocide in Rwanda and Burundi. That £1.5 million had simply vanished into the ether. To make the episode worse, the incident only came to light years after the fact, allegedly because the Commission did not inform the Court of Auditors when irregularities in the aid programme were first noted in 1994.
Some explanations of why that money went astray are sublimely pathetic. Some reports, such as one in The Sunday Times in October 1998, maintained that money intended for field workers in areas of conflict was spent on hiring more bureaucrats in Brussels. Another reason, according to a report in The Daily Telegraph in October 1998, was that the money was not necessarily misspent or wasted, but that no one either knew or could trace where it went. Clearly, fraud can take place in many areas under many guises and we must find a system that will ensure that we try to reduce it.
In my few short remarks, I want to deal with agricultural fraud and the major problem of fraud in the common agricultural policy. Agra Europe, the European independent weekly, summed up that problem rather well. It said:
The essence of the major —and minor—frauds … is either claims for subsidy payment on products which do not exist or the misrepresentation of a less valuable form of a commodity as a more valuable one. Almost all CAP frauds are variations on these essentially simple stratagems. The more it becomes necessary for the EU to support and protect every part and sector of the agricultural market, so these measures become more comprehensive and more complex.
Commenting on why fraud is so closely associated with the CAP, Agra Europe said:
The reasons are obvious: the CAP still accounts for almost half of the EU's expenditure and spending within the…budget essentially involves payments to individuals and companies involved in trade in agricultural commodities. Expenditure in other sectors of the budget tends to involve payments to government and other official bodies and fraud is therefore much more difficult to perpetrate on these types of payments.
That article sums up why fraud in the CAP —accounting, as the policy does, for half the EU's budget —is such a great problem. It also explains why so much of the EU's expenditure is diverted directly to individuals, small companies, farms and so on.
How can we deal with that? Last Friday, I got some insights when I visited Mr. James Walgate, who farms in Swallow in Lincolnshire. Turning from the rather esoteric arguments in which we talk about millions and billions of pounds, I shall take matters right down to the farm gate and give an example of how fraud affects farmers in our constituencies. I sat in Mr. Walgate's farmhouse and talked through some of the issues with him and his colleagues who, as a group of English farmers, are tearing their hair out at the amount of regulation and red tape with which they have to deal. They told me that they feel that they are not farming barley, wheat, cows or sheep, but brown envelopes, filled, not with cash —sadly for them —but with forms. Indeed, they showed me form after form after form.
No doubt, all those forms are considered necessary to combat fraud, the very issue discussed by my right hon. Friend. The farmers showed me page after page of the

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set-aside form, much of the information in it duplicated. They showed me a folder full of all the enforcement notices on health and safety at work with which they must deal. My right hon. Friend may tell me that all those issues show that the Ministry of Agriculture, Fisheries and Food is doing its best to ensure that the subsidies that are available to our farmers are not misspent fraudulently. However, one must ask oneself whether those farmers' competitors in other EU countries, especially Mediterranean countries, face the same degree of regulation and oversight. Our own farmers are convinced that they do not.
I do not want to get into that debate too much as that ground has been well ploughed in the past. Essentially, the argument is negative, as it is difficult to quantify exactly how much fraud is going on in Spain, Portugal, Italy or wherever. We have heard about olive oil scams and so on, and the Government argue that, in any event, such matters are not their responsibility. However, they are responsible for ensuring that the money is spent correctly with minimum regulation and bureaucracy being imposed on our farmers.
I shall offer a practical solution to finding a way out of the appalling level of fraud in the common agricultural policy. As the article in Agra Europe sets out, that fraud is the result of the very nature of the subsidy system in Europe which, essentially, is based on a long series of production costs and units, such as the suckler premium scheme, the beef special premium scheme, the veal calf premium scheme, and so on. Such a large number of complex support schemes, which are distributed to many individuals, small companies and farmers, means that fraud is inevitable.
The only suggestion that I can make is that we should change the whole subsidy mechanism so that we subsidise incomes rather than production. The Government have introduced the working families tax credit in this country, so why can we not have a working farms tax credit in Europe? That would shift subsidies from the series of complex support mechanisms into simple support for farmers' incomes, especially those that are relatively low.
I know that our Government have argued against such a scheme in the past because our farms tend to be larger than those on the continent, where there are many more part-time farmers. However, I should have thought that one could create a mechanism based on the farm's working population so that the subsidy would depend on whether the farm employed an individual, a family or farm labourers. It would then be far easier to track where the money was going and to deal with fraud. I can see no other way to solve the problem.
I am impressed by what my right hon. Friend has said, and I warmly support all his points about trying to support Vice-President Kinnock. I share his view that Mr. Kinnock is probably the right man for the job—anybody who could sort out the Labour party in the early 1990s is surely capable of having a good go at fraud in the EU. I am sure that my right hon. Friend is right to say that we can try to develop mechanisms within the European Parliament which mirror this country's effective mechanisms such as the National Audit Office.
We must ask, "Who guards the guards?" How can we have a genuinely independent office in the EU, with independent staff and oversight by independent
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politicians, which can delve into the inner recesses of the EU? These matters are detailed and complex, and we need a body as independent and professional as the National Audit Office to cope with them.
I have no argument with anything that my right hon. Friend said, but I would just point out that, in dealing with the CAP and an area as wide as the EU, in which farming stretches from Sicily up to the north of Scotland, simply tweaking the mechanisms in the European Parliament or the Commission will never enable us to get to the root of evil in the system. It is difficult to root out fraud when such complex, wide-ranging and different subsidies apply to the whole range of production. I end with a plea: will the Government argue for a complete change of the support mechanism which gets to the heart of fraud and moves the basis of subsidy from production to people?
11.43 am
Mr. Frank Field: I apologise, Mr. Deputy Speaker, for being late to the debate; it is a discourtesy to the Chamber, but I did tell the Speaker that I would be delayed. It was a double blow because I missed half of the speech by the Chairman of the Public Accounts Committee.
I want, first, to centre on why this is such an important issue, whether one is for or against Europe or the euro, and, secondly, to make some suggestions to my hon. Friend the Economic Secretary, who is to reply to the debate. There is no reason why she should respond immediately, but I would be grateful if she corresponded with me and put her replies in the Library.
This issue is so important because there are large sums of British taxpayers' money at stake. Taxpayers are forming a view of Europe as a result of our ability or inability to satisfy them that we are safeguarding their hard-earned cash. In Birkenhead some time ago, we had a debate, not about Europe but about the euro, and very strong views were expressed. It is to the credit of those who were pro-euro that when they went out to try to get the Labour vote out in the European elections, they came back and reported honestly Labour voters' response to the idea of Europe and to voting in a European election: the voters summed up what they saw in Europe as a thieves' kitchen.
That is worrying for those who are serious about the long-term prosperity of Europe. It is more worrying for those who are madly in favour of all that Europe does than it is for those of us who may have some questions, particularly about the euro. It is therefore crucial that the Government respond properly and effectively to the issues that we are raising today.
I would like the Government to take certain steps. We should learn from our efforts in this country to counter fraud, which are admirable compared with those in Europe. It would be sensible for us to give up thinking that we can devise a grand strategy which will deal with fraud with a big bang. We need to learn from one another about the steps that we can see working in member countries and implement those measures across Europe to protect the taxpayers' money that feeds the European machine.
I shall make five brief suggestions. First, given that we do not know whose hand is in whose pocket over there, let alone whose hand is in our pocket over here, it is

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crucial that we have an independent system of auditing, separate from the main Departments because, clearly, some of the problems are in the Departments themselves. The one organisation that shines out among all others is the Court of Auditors, which is beginning to show the independence that one would expect from a body within the British political tradition. I suggest that the independent audit office that is to operate in Europe should not report to any of the Departments or even to Commissioner Kinnock, although I totally agree with the comments that have been made about him. The office needs to report to the body that has begun to show its independence, as it did in supporting Paul van Buitenen, who has already been mentioned.
Mr. Oaten: I agree in principle with what the right hon. Gentleman is saying, but will he expand on his remarks? If the body is not reporting to the Commission, but only to the Court of Auditors, where is the democratic accountability? How do we get the report and recommendations before elected politicians?
Mr. Field: I have problems about whether the institution is democratic anyway, but I shall deal in a moment with how we can make the EU more accountable to all of us, in Europe and here at home.
My second suggestion is that we should draw attention to the Government's success on whistleblowing. The measures that this country has to protect whistleblowers should operate in Europe as well, where there is an appalling state of affairs. The guy who bravely and effectively drew our attention to what was going on in the thieves' kitchen was set upon by people, many of whom were the thieves themselves, who were trying to make sure that he did not continue to speak. Moreover, he is already back in the dock as a major suspect for leaking papers in another area of fraud. How much pain can one individual take if he is not protected properly by the safeguards for whistleblowers that we in this country think are important? [Interruption.] There is clearly a European fly trying to dive-bomb me. I hope that he does not have one of those sharp umbrellas with which to attack me, or I may keel over.
My third point is that we know that the Commission returns some of our money to us to spend in this country. There is now concern about whether the employment programme funds have all been spent as they should in this country. I ask my hon. Friend the Economic Secretary to look into that matter and report on whether we have followed up the complaints that the relevant Departments in Europe have made about the spending of money that went from this country to Europe and has been recycled back again.
Fourthly, may I suggest, as a method of increasing confidence in what goes on in Europe, that the Government regularly publish the names of those who are charged with fraud offences in Europe; when they were charged; what action is being taken and the final outcome, both internally and then, I hope, in the courts. That would boost morale in this country and show that we are attempting to get to grips with the problem of fraud, the size of which is unclear.
Fifthly —this touches on the point made by the hon. Member for Winchester (Mr. Oaten) —never mind what the European Commission comes up with, could the
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Government present an annual report to Parliament on what new moves are being undertaken to protect our funds and then find time for us to debate it?
I am pleased to have the privilege of speaking in the debate. I do not think that there is a grand strategy or that we can sit around for decades trying to work out how to deal with fraud, in Europe or elsewhere. The method must be to find out what works and then to build on that. I have made five suggestions, but I have not had a chance to warn my hon. Friend the Economic Secretary about them. I shall understand if she cannot respond to them at the moment. However, I should be grateful to her if any correspondence could be placed in the Library so that we could all draw on it.
11.51 am
Mr. Christopher Gill: I shall make but a brief contribution to the debate. I congratulate my right hon. Friend on obtaining this important debate. In previous years, I have been a regular contributor to the debate on the Court of Auditors report. I have concluded over the years that fraud is endemic in the European Union, and I do not have much hope that it can be eradicated. I shall ask a question that goes to the root of the matter: what is the EU doing with the funds that are available to it that could not be done by nation states?
My right hon. Friend has said that the EU does not have the means or the mechanisms with which to control its funds adequately to ensure that fraud is reduced to an acceptable level. I do not say that fraud can be non-existent, because we shall never live in that perfect world. He was right to say that there is a great difference between what goes on in the European Parliament and the Commission and what happens in the United Kingdom, where our system ensures that there is little dishonesty or fraud in the body politic.
The explanation for that is that we are all directly answerable to our electorates in a way that continental politicians simply are not. If we were caught up to mischief, the electorate would wreak their vengeance on us and we would no longer be Members of Parliament; indeed, the whole Government could suffer a similar fate. In contrast, from time to time on the continent, those whom the electorate have rejected reappear not only as members of their parliaments, but as members of their administrations. Of course that removes one of the important checks and balances of our system, which I believe to be absolutely invaluable.
Rather than Europe trying to drag us into its system of doing things, there would be great virtue in our persuading Europe not only that our system works and ensures that there is little fraud, dishonesty or corruption in our body politic, but that we have the blueprint that the rest of Europe would be well advised to follow.
What does the EU need the money for? I contend that the functions that it discharges that involve or require large sums can and should be carried out by individual nation states. The answer to that question is that the EU needs the money because it needs largesse, without which it could not persuade individuals and individual countries to do things the way it wants.
My hon. Friend the Member for Gainsborough (Mr. Leigh) has mentioned fraud in farming. In my experience, when we crack down on such fraud, the poor

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take the blame. I have a letter with me this morning about one of my constituents who has 42 cows. She is in desperate trouble because of a crackdown. She has made an error in her paperwork and will forfeit what to her is an important part of her income. That is not the source of the fraud; the source is in the big time. The Mr. Bigs of farming —more particularly, the Mr. Bigs of farming on the continent —get away with massive fraud, and that is the system there. It is probably more than an inspector's life is worth to take issue with the big-time fraudsters who prosper under the system.
My solution to the problem would be to repatriate the spending to the nation states. This country certainly has much tighter controls. If we did not, we as politicians would pay the price by losing our seats, or the whole Government would collapse. My contention is that such money is necessary not for the good that it does, but simply to ensure that the EU has a hold over those on whom it wishes to force its views. That is shown very much in this country's farming industry, where those who might otherwise comment on those matters in the context of agriculture in Britain are in receipt of large sums—some of the cheques are for more than £1 million. Clearly, they will not bite the hand that feeds them. They will not lead the industry in opposition to what I believe is a corrupt regime. That explains, in a roundabout way, why the EU needs that largesse; it buys off its opposition, so it can continue with the systems that many of us think are totally unsatisfactory.
11.58 am
Mr. Mark Oaten: I begin by congratulating the right hon. Member for Haltemprice and Howden (Mr. Davis) on initiating the debate. I note that other hon. Members have avoided mentioning his constituency. I shall refer to him as the Chairman of the Public Accounts Committee, because that is easier. I agree entirely with the remarks that he made in his speech, which were powerful coming from the Chairman of that Committee. I hope that the Economic Secretary will deal with some of the points that have been made.
I agree with all the speeches that have been made, except the previous one. We have heard some thoughtful ideas, certainly from the right hon. Member for Birkenhead (Mr. Field), and the hon. Member for Gainsborough (Mr. Leigh) made some good points about the common agricultural policy, to which I shall refer later.
I welcome the opportunity to discuss fraud. The EU could deal with fraud in one of two ways: it could adapt and ensure that its public administration goes through the motions of reform, or it could tackle the problem and put in place genuine reforms so that it begins to revitalise the rather tarnished reputation that it has not only in this country but among the citizens of Europe.
As we have heard, it is now 15 months since the European Commission resigned en masse, so it is critical to find out what has happened in that period. We have heard this morning that the Neil Kinnock reforms are in place and bedding down. Whatever our views on Europe, we all hope that Kinnock can draw a permanent line in the sand by creating a much more transparent and accountable Commission.
Before I deal with the reforms and where they are going, it is worth reflecting on the scale of the problem. I speak as someone who is pro-European. I am
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passionate about our country's role in Europe, but, while researching my speech, I began to feel slightly Euro-sceptic, because the scale of fraud that is taking place brings out the worst in anyone.
This morning, we have heard that there are different debates about how much fraud there has been. The Court of Auditors, which I think is respected on the issue, has estimated that 5.5 per cent. of the EU budget is lost every year through what it describes as mismanagement, wastage or outright fraud. The amount is nearly the same as the UK's contribution to the EU in the first place. There are some who believe that that figure is somewhat conservative and that the real figure is nearer 10 per cent.
Frankly, whether it is 5 or 10 per cent., the figures are outrageous and totally unacceptable. How can any European citizen have faith in a system in which the budget is approved by a democratically elected Parliament, only to be squandered by bureaucratic, centralistic and unaccountable institutions, which is, sadly, what we have in the EU at the moment?
The Court of Auditors has had to deal with large amounts of EU money. I am concerned that there have been delays in the way in which it has been able to sign off accounts. We have heard that it does good work, but it cannot be right that it cannot sign off accounts even, sometimes, many years in arrears. It is not a good process and system to have in place. The Court of Auditors itself cannot work with the type of systems that we have in this country.
In March, I met Paul Van Buitenen, whom we have discussed and who is widely known as the whistleblower. He and I had an hour-long meeting. I was appalled at some of the stories that he told me about the intimidation and difficulties that he had had to face. I was shocked to learn that the Commission had in place what were effectively gagging order regulations against individuals such as him to prevent them from talking about the irregularities that he had discovered. It epitomised the culture of the Commission that an official was forced to put his position and career on the line and to breach confidentiality to expose the substantial mismanagement and fraud.
Although I admired Paul Van Buitenen's courage, I was astounded by the absence of checks and balances that should have been there in the first place. That raises the question: if he had not had the courage to intervene as he did, would the Commission not have resigned? Would it be shielding some of the things that had taken place? I suspect that that would still be the position.
We have had evidence not only from whistleblowers, but, in April, from Sir John Bourn, head of our National Audit Office, who reported to this Parliament, identifying "significant weaknesses" in the management of the Commission's budget. The NAO found that there may have been errors totalling £3 billion in European payouts in 1998 alone. Together with new clear accounting policies to improve the reliability of the Community's accounts, he called for a simplification of the CAP.
I was interested that the hon. Member for Gainsborough said that the system was complex, and then suggested that we consider a farm tax credit. I am all in favour of simplifying the system, but that sounded

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like a more complex system. I am not entirely convinced that it would crack down on fraud, but we know that the CAP is badly in need of reform.
What are the solutions? Last November, for example, Neil Kinnock launched the whistleblowers charter for the European Commission, which aims to put in place procedures to protect whistleblowers. I hope that that to some extent deals with the concerns that the right hon. Member for Birkenhead raised about putting the processes in place.
The charter mentions the European anti-fraud office, also known as OLAF, as an external channel through which officials can safely report their suspicions to a body that is independent of the Commission. The new OLAF office organises and conducts administrative investigations to detect fraud and irregularities connected with the financial interests of the Community.
Between 1 June 1999 and 31 May 2000, 68 administrative investigations were opened, 30 others were closed and 67 reports were filed. The Chairman of the Public Accounts Committee said that he wanted more of those issues to be aired and some of the details to be available to the public. I welcome the fact that much of OLAF's work is now available on the internet. That is an important step towards much greater transparency and accountability, but, picking up on the points that were made by the right hon. Gentleman, it is important that OLAF's work is monitored independently, so that we have proper accountability.
The Kinnock White Paper detailed a promising reform programme, which was started in March and is expected to continue until the second half of 2002. It focuses on three key areas: comprehensive reform of personnel policy; modernisation of financial management; and control of new systems. I support that programme and agree with the concerns that have been raised about the time scales, which need to be put in place—but progress is being made.
This morning, I had an opportunity to meet Mrs. Fontaine, the President of the European Parliament, and to discuss the Kinnock proposals with her. People sense an atmosphere of change, and that the proposals are beginning to bed down, but, when I discussed the reforms with Paul Van Buitenen, he expressed a concern that, although they may deal with the internal processes, there is a fundamental problem in terms of the culture in the EU, which is much harder to tackle.
The issue that Paul Van Buitenen put to me in cultural terms was that the EU lacks genuine transnational political parties. His argument was that everyone feels a stronger sense of affinity to his own nation, rather than to a pan-European group, and that that can make the imposition of standards difficult and disjointed. I hope that the EU tackles the cultural issue much more.
Of course, the debate about delivery and accountability in Europe is not about just what goes on in the EU. Eighty per cent. of EU spending is disbursed by member states. That is where most of the fraud takes place. An anti-fraud strategy must go beyond Brussels. It must be Europe-wide. That will be a major challenge for some of the EU member states that do not, if I can put it politely, have the same standard of probity in public affairs as we do.
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This touches slightly on the concern of the hon. Member for Gainsborough about the level playing field. If the EU is to embrace enlargement —I hope that it does so —to expand and include countries such as Albania, Poland and Hungary, we must be absolutely sure that the conditions of entry require those individual countries to raise their standards, too.
I am pro-European. I am pro-currency, pro-engagement and pro-Britain playing a full part in Europe, but I am disheartened by the fraud that is taking place. For those of us who believe that Europe is the way forward and is in our best interests, it is damaging our cause and our case. Bluntly, it is wrong that public money is mis-spent in that way. The Kinnock proposals represent a way forward, but, beyond that, there needs to be a cultural change in the EU. I hope that the British Government will take a lead on those issues when they argue for better probity at the conferences in the year ahead.
12.7 pm
Mr. Howard Flight: I, too, congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr. Davis) on securing the debate. There is obviously a model of proper conduct and of ways of dealing with such problems in the UK. It is a pity that it does not and cannot operate more widely in the EU.
I remind hon. Members that as late as the mid-18th century, the Paymaster General's role was to milk public funds. Indeed, Fox's father made himself rich by so doing. We have not always had the standards that Gladstone established, and they do not seem to establish themselves satisfactorily across the channel.
I echo the support for Commissioner Kinnock. I am sure that he has not been infected by the environment that he is operating in. As has been pointed out, the report seeks to address the processes at least —but I, too, doubt whether it will be effective, because of the cultural problems.
On specifics, I agree that the Court of Auditors must have a rotating chairmanship drawn from the opposition. It must have independent auditors; it is complete nonsense for it to be staffed with insiders, as it were. It must report to the European Parliament, and, potentially, to European Governments individually, on its findings about what has gone on in member states.
I cannot help feeling that it would be useful for the European anti-fraud office to visit Hong Kong, which has the most effective anti-corruption fraud office in the world, although admittedly it is a small country. Again, if the European anti-fraud office is not independently staffed, I cannot see that it can do a proper job. Clearly, it must be accountable to the Court of Auditors.
As others have said, it is clearly essential to have adequate protection for whistleblowers —and, I would argue, rather better protection in this country, given the background —and proper exposure and punishment of offenders. It is unacceptable that individuals can return to power when they have a track record of corruption. I suggest that the European Parliament could do with a Nolan, as it were. Its standards are certainly not the standards of this Parliament, but such a committee is probably the only body that has the power to dismiss a corrupt Commission. Having that ability would give it a powerful raison d'être.

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The central problem of the common agricultural policy is that 80 per cent. of the money is dispensed by member states. The question is how they should be policed, because, to some extent, member states have a self-interest in obtaining as much as they can from the centre. It is a culture of "them", not "us". It will always be difficult for member states to police themselves, but it would be expensive to police them centrally. The common agricultural policy now costs £29 billion and the system clearly invites corruption. Ultimate reform can come only from the abolition of that system.
I wish to touch on a point that has not been raised. The CAP operates the exchange rate compensation scheme, which is drafted in a completely incomprehensible way. While sterling has strengthened by 50 per cent. against other currencies, and what is effectively one European currency, £1 billion or £2 billion a year in compensation has been paid out to Italy, Sweden, Germany and other member states. What is the logic of paying them compensation, because their currencies have weakened en bloc and they have enjoyed the advantages of that? On undertakings for collective investment in transferable securities, the German banks have blocked the development of money funds in Europe, and that is a different form of corruption.
The public in the United Kingdom have rumbled the situation. In a wonderful phrase, the right hon. Member for Birkenhead (Mr. Field) pointed out that they perceive the set-up as a thieves' kitchen. As people on both sides of the argument have said, until there is an improvement and proper standards of conduct, the credibility and standing of European Union organisations will decline further in the eyes of the British public.
When I was a meritocratic student at one of England's leading meritocratic universities, I studied mediaeval history. The wonderful Professor Walter Ullmann put his finger on the problem. Whereas the UK and other Anglo-Saxon nations have the deeply rooted concept of power ascending from the people and the tribe, and leaders being accountable to the people, the problem with continental Europe is that it still has the Roman empire and mediaeval tradition of power descending from God, or what have you. That creates a powerful obstacle in the way of properly exposing corruption, because the citizenry does not expect that to be done. They expect lower standards of conduct than we are used to in this country.
Commissioner Patten has been mentioned. I specifically recollect that £500 million of development support was allocated to South Africa, of which only £20 million of actual expenditure was ever discovered, and most of that was wasted. Some £480 million was completely unknown and unaccounted for. That is unbelievable.
I am nervous that, despite the good intentions of Commissioner Kinnock, there is still not the will to tackle the problem effectively. As was said, we do not know whether fraud is 7 per cent., 10 per cent., or the Court of Auditors' estimate of 5.5 per cent. The issue is not on the Nice agenda, and the view is that it has been buried for the time being.
The Treasury will no doubt refer to its report and to the five proposals of the European Court of Auditors concerning the elements of the structure that are
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missing. However, the problem goes a great deal deeper. Perhaps, only when member states look to devising methods of imposing their own sanctions against corruption will there be any real and dramatic change. In the meantime, I wish Commissioner Kinnock every success, and I commend him on his proper standards and his attempts to address a major problem.
12.15 pm
The Economic Secretary to the Treasury (Miss Melanie Johnson): In the 15 minutes allotted to me, I will struggle to respond to all the points that have been raised. However, I shall do my best. I apologise if my reply is a little bitty, but it is either that or answering fewer questions.
Like everyone else, I congratulate the right hon. Member for Haltemprice and Howden (Mr. Davis) on securing this debate. I know that the subject is dear to his heart and that he refers to it on many parliamentary occasions. I welcome the fact that he has raised the subject and I welcome the contributions that have been made. The Public Accounts Committee was so concerned about the issue that when its members visited Brussels last year, they interviewed key players and produced the important report on "Financial Management and Control in the European Union". It raised many pertinent questions about the state of European institutions and the Commission itself.
The right hon. Gentleman asked about the independence of OLAF and its relationship with the Commission. The arrangements that have been put in place are entirely right, because the Commission has the responsibility, under the treaty, for budget execution. That responsibility must include instituting effective fraud prevention procedures. The anti-fraud office needs to understand the organisation that it is investigating so, in that sense, it needs to be an insider with access to information about what is happening within the organisation. Past experience bears that out. The Commission's previous anti-fraud unit, UCLAF, investigated all the fraud allegations that featured in the wise men's report, but, under the previous arrangements, it had no responsibility for follow-up and there was no mechanism to ensure that the right course of action was taken.
The new arrangements under OLAF will make recommendations on follow-up, and the institutions will have to report on whether that has been carried out. In addition, the unit's director will report to the European Council and to the European Parliament. I take the point made by the hon. Member for Winchester (Mr. Oaten) that the important element of accountability in the reporting arrangements must be considered. It is important that we do not lose sight of that.
The question of whether we should replicate the arrangements used by the Public Accounts Committee was raised. The PAC works because officials have clear roles and responsibilities. The accounting officer in the National Audit Office knows that he is responsible for ensuring that Departments apply the rules and will have to answer if they do not. That is why we pressed the Commission, as a priority, to set out clear roles and responsibilities for all staff. Indeed, the White Paper on reform, which I shall refer to in more detail shortly,

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includes important measures in that regard. We know that the Commission intends all staff to have clear job descriptions and objectives by the autumn. We will keep up the pressure to ensure that there is real and meaningful reform. I agree with all the contributors to the debate who stressed the need continually to press for progress on that front.
Questions were raised by the right hon. Gentleman about Italy. Fraud cases tend to be enormously complex and can take an extremely long time—often years—to investigate. That is not unusual, if we compare it with fraud investigations in the UK on matters unrelated to the subject of the debate. That is frustrating for all of us, but it is not outside the bounds of our usual experience of the difficulties of detecting and investigating fraud. For that reason, it is difficult to comment on individual cases.
On the security contract fraud, the security firm was replaced and investigations by the Belgian police are still going on into the allegedly fraudulent contract arrangements mentioned by the right hon. Gentleman.
It may be helpful if I deal next with whistleblowing. It would have been wrong to intervene without knowing the full details of the case, as ill-considered intervention might have endangered ongoing investigations. However, I accept that there must be rules governing whistleblowing. Since the Government came to power, we have taken significant steps in the UK to establish such rules.
Van Buitenen was the subject of a disciplinary hearing, which reprimanded him for actions that were considered to compromise certain criminal investigations that were in progress; but the judgment was mitigated by the circumstances of his case, particularly the lack of proper procedures for reporting concerns about improper practice.
Mr. David Davis: I thank the Minister for giving way. I do not wish to delay her progress, but is it plausible for a whistleblower who has brought a matter to public attention for the first time to be reprimanded on the grounds that he is jeopardising a criminal prosecution, when no criminal prosecution has ever been brought to fruition in the European Commission?
Miss Johnson: The right hon. Gentleman makes a useful point, but it is fair to say that with regard to the way that van Buitenen behaved, there were issues on both sides. It was not an open and shut case. We accept that whistleblowing by employees is extremely important. If they suspect fraud, they should be encouraged to report it, and whistleblowers should be protected. That is an important principle. I agree with both the right hon. Member for Haltemprice and Howden and my right hon. Friend the Member for Birkenhead (Mr. Field), who made those points particularly strongly.
The Commission's decision in June 1999 on whistleblowers sets out clear procedures for reporting suspected fraud, corruption and other illegal activities. Those procedures will be formalised in the revision of the staff regulations which is in progress, as part of the Commission's reform programme. The aim is to ensure
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protection for a whistleblower acting in good faith and in the public interest. We respect and value that in this country, and have taken steps to put it in place in full-blown form in the UK. Until just a few years ago, we could not claim that everything in our country was right, and indeed, we still cannot be confident that it is all right.
On the subject of structural flaws in the Parliament which lead to protection for individuals by political parties, it is essentially up to the European Parliament to decide how it organises its sessions. The right hon. Member for Haltemprice and Howden proposed an interesting idea in that respect which is worth exploring further.
The right hon. Gentleman also referred to tourism fraud. I agree that the Commission's handling of the matter was not competent. That is why it was so necessary to implement the reforms. There must be greater co-operation between member states. There is scope for taking forward and implementing effectively the Eurojust proposal for an agency to assist co-operation and to allow the exchange of information—for example, about the evidence that needs to be gathered in one member state to be used in legal proceedings in another member state with a different judicial system.
I am sure that Commissioner Kinnock will be somewhat embarrassed by the support that he has received from all right hon. and hon. Members present, but no doubt he will also be delighted. Of course, the Government support reform and the work that he is heading in the Commission.
I agree that staff regulations are too inflexible. Lengthy consultations with staff are required. The last reform took place 10 years ago, so the situation has been left untouched for too long. There is a need to get it right this time. That will take time and negotiation, but we are not complacent. We are keen to make progress, as is Neil Kinnock, I am sure.
There is already a code of conduct for Commissioners, and there are proposals to protect whistleblowers. The White Paper on Commission reform incorporates proposals to modernise staff management, including an overhaul of recruitment procedures, improved training and career management, a proper system of staff appraisal based on job objectives that are directly linked to Commission objectives—a highly desirable feature—a merit-based system of promotion, which is important, and a more effective disciplinary system, which is also important. All the right sort of measures are being progressed.
The hon. Member for Gainsborough (Mr. Leigh) spoke about the way in which EU funds are being wasted. The level of error is clearly unacceptable, and we have been pressing the Commission and other member states to take action. However, we must not lose sight of the fact, pointed out by several speakers in the debate, that 80 per cent. of the expenditure goes through individual member states, and is therefore up to them. We need to address the matter through the EU and by putting pressure on member states through member-state to member-state channels.
Contrary to what the hon. Member for Ludlow (Mr. Gill) said, it is not simply a matter of tackling the Commission. Member states must be tackled. We are

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working with them to improve financial control, which includes work to simplify regulations and provide clarification of eligible expenditure. I agree wholeheartedly with my right hon. Friend the Member for Birkenhead that the mismanagement of public funds undermines the confidence of European taxpayers in the EU. We must work together to remedy an unacceptable situation.
With regard to humanitarian aid, one of the problems is a lack of resources to manage the aid programme. Most of the resources did not go astray, but were used to administer the aid programme. That relates to the point about how much is fraud and how much is money mismanaged in various ways, which is also a big issue. Much of what is described as fraud is not technically fraud, but mismanaged funds.
Mr. David Davis: One example is the 2.4 million ecu contract, which was fictitious. Some of the money, as the hon. Lady says, was used for other employees, but two thirds of a million ecu are still missing. The money cannot all have been used properly.
Miss Johnson: At no time did I suggest that all the money was used properly. I believe that the sum of £400,000 is unaccounted for, but I agree with the right hon. Gentleman that money unaccounted for is unacceptable. We must do more to tackle the problem. Activity-based budgeting will help us to identify the administrative resources needed for efficient management. That is an important part of ensuring that resources reach their destination and that no fraud takes place. The distribution of aid has been the subject not only of proposals by Commissioner Patten, as the right hon. Gentleman said, but of considerable ongoing discussions in various EU forums, including the Budget Council, with which I am involved.
The hon. Member for Gainsborough spoke about the CAP. It is worth while pointing out in relation to his East Anglian example—I know the hon. Gentleman's constituency a little, and I am not sure whether Gainsborough considers itself part of East Anglia, but it is not far short—the claimant literature is constantly being reviewed. We are trying to simplify the pilot scheme for arable area payments in East Anglia. Those may not apply to his area, but efforts are being made to lessen the bureaucratic burden on farmers. We all—
Mr. Deputy Speaker: Order.

Police Services (Sutton)
12.30 pm
Mr. Tom Brake: I am delighted to have been given the opportunity to raise a number of issues about policing in Sutton. I know that my hon. Friend the Member for Sutton and Cheam (Mr. Burstow) would like to speak too, so I shall try to limit my contribution.
It may be unusual, as an Opposition Member, to say that, generally speaking, things in Sutton are working well. The overall policing picture is a good one by comparison with other parts of London and the country. Sutton has the second lowest crime rate in London, and I pay tribute to the local force and the local council for achieving that. I am happy to back the bid by Sutton police to make Sutton the safest borough in London.
Not everything is perfect, of course. The Sutton racial equality council is concerned about the under-representation of ethnic minority officers, the turnover of staff in the community safety unit and the degree of consultation with ethnic minority communities. Perhaps the Minister could comment on the progress that is being made in meeting the target of 5 per cent. ethnic minority officers by the end of the year. There are also concerns in the constituency about 999 calls that are unanswered. I know that that issue was touched on in the debate last Friday.
Sutton police force is having to adjust its numbers following the boundary change with Surrey police on 1 April. That change means that the police boundaries are, for the first time, exactly coterminous with those of the London borough of Sutton. That change has resulted in the creation of the smallest police division in London, but one which I believe is perfectly formed.
Inevitably, reorganising the force and deciding which officers go to Sutton and which to Epsom has not been the easiest of tasks. Furthermore, the boundary change has left Sutton over strength by a net number of 21 officers. The serious shortfall in police numbers across London—hon. Members should be aware that those numbers have fallen by about 1,700 since the Government came to office—has meant that the 21 officers have had to be redeployed elsewhere.
Not surprisingly, many of those officers who were forced to move wanted to stay in Sutton and have been upset by their enforced relocation. Does the Minister agree that enforced relocation, whether caused by a change in police boundaries or by the tenure policy that requires officers to be moved perhaps two or three times within their careers, is unpopular within the Metropolitan police and ensures that valuable local experience and specialised expertise are lost?
Will the Government provide input to the consultation with the Commissioner of Police of the Metropolis on this important issue and support changes that make these moves voluntary rather than mandatory? When do the Government expect the Commissioner to report back on his consultation?
Enforced relocation is not the only local issue; pay is another. I recently secured an Adjournment debate in Westminster Hall on public sector workers' recruitment and retention in London. During that debate, I raised

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the issue of the cost of living for those workers. The Home Secretary clearly read his Hansard and listened, at least in part, to some of the points that I and other hon. Members raised during the debate. Last week, he announced that effectively he was restoring to London police officers recruited after 1994 the housing allowance that the Conservatives abolished in 1994. That is a Liberal Democrat campaign success which, the Minister will be pleased to hear, we shall widely advertise in Focus. [Laughter.]
The Home Secretary made the correct decision, though it will not solve current problems. What assessment have the Government made of the extra number of police officers who will be recruited and retained as a result of the change? I know that the Home Secretary was not able to answer that question last Friday, but perhaps the Minister will have had time over the weekend to analyse its impact. It remains the view of senior officers in my patch that retention will still be a problem even after the Home Secretary's welcome announcement.
Even in London's second safest borough, we cannot afford to lose officers. Last year's crime figures in Sutton were a disappointment, and ultimately that is the test of a policing and crime strategy. There was an increase in crime overall and in each of the major categories. Although burglary and vehicle crime rose relatively little, violent crime increased by 22 per cent. and street crime by 36 per cent. Those are the most worrying features.
I am happy to praise my local police force, but those figures are depressing and we cannot afford to be complacent. I know that Sutton police are not complacent and that they are redoubling their efforts to get Sutton back on track. However, unless they are given the resources that are needed, they will be facing an uphill struggle because of the increasing demands on police resources.
Is the Minister, for example, able to confirm the cost of policing the £1.5 million party that Sir Bob Geldof will be organising for London's mayor, the hon. Member for Brent, East (Mr. Livingstone)? Who will be paying for the policing of that event? What mechanisms exist to stop resources being siphoned away from a relatively safe borough such as Sutton to inner-city boroughs by a Metropolitan police authority, which perhaps inevitably will have an inner-city focus? Will the Minister say how much of the budget of Sutton police will have to be paid out for the welcome increase in post-Sheehy officers' salaries, which will be effective from next week? I shall be happy for the Minister to respond later in writing because I have not notified him of all these questions.
There are ways of maximising the best use of police resources. I recommend the positive partnership approach that Sutton police have with the London borough of Sutton in tackling issues such as graffiti. Sutton council has also been working locally with the probation service on its anti-graffiti strategy. Following successful graffiti projects at Wallington station in my constituency and Stonecot hill, the council's community safety unit is co-ordinating a new project, again in my constituency, at Wrythe lane, Rosehill, which started on Monday.
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Following consultation with shop owners, local residents, the police and the probation service as well as the Sutton youth awareness programme, murals are being created on 19 shutters at a row of shops in a busy shopping location. Not all the shop owners wanted a mural, and that is fine. None will be forced to take one. Offenders on community service orders will paint the shutters, ready for the murals to be painted on by local young people, supervised by Darren Cullen, who is a former graffiti artist.
I am sure that hon. Members will agree that that sort of partnership approach should be commended. However, I am concerned that the good work of all the organisations could be undermined in Sutton by the circulation of a magazine called Graphotism. I do not have a copy of the magazine to show hon. Members, but I have seen photocopies of some of the pages. The magazine is clearly dedicated to the promotion of graffiti. It features photographs of graffiti on commuter trains and it markets products for use by graffiti artists. Many people, including me, take the view that it encourages people to break the law. There is a very small disclaimer that can hardly be read on the pages of the magazine, and apparently that may be enough to let the producer off the hook.
What action can be taken against the publishers of such a magazine? I understand that the police solicitors and the Crown Prosecution Service believe that it would not be possible to prove mens rea, or intention. What further steps are the Government considering to deal with such a blatant incitement to commit a criminal offence?
One way of dealing with the problem of graffiti, if not Graphotism, might be through the creation of community constables, an idea that Susan Kramer promoted tirelessly in her excellent mayoral campaign. The idea is a simple one, and I am sure that the Minister will be familiar with it. I can point to a good example in my constituency. The Sutton parks constabulary is now in its second year and is proving very effective. Council officers are used to doing some of the work that would otherwise be done by the police and they are doing an excellent job. In the past year, for instance, the parks constabulary received 587 calls and dealt with a wide range of issues, mainly relating to youth disturbance, burglar alarms, unauthorised vehicles in parks, joyriding and abandoned vehicles. What plans do the Government have to extend the range of responsibilities that parks constabularies and others could take on?
Sutton is a relatively crime-free area. Local residents, the council, the police, my hon. Friend the Member for Sutton and Cheam and I all want to keep it that way. In fact, we want to make Sutton the safest borough in London, but we cannot do that without addressing the issue of officer retention and without a guarantee that Sutton will not be penalised for its success in keeping crime down. I hope that the Minister will be able to reassure Sutton residents on those points.
12.40 pm
Mr. Paul Burstow: I want to underline one or two of the points that my hon. Friend the Member for Carshalton and Wallington (Mr. Brake) has made.
Some years ago, my parliamentary predecessor, Lady Olga Maitland, secured a debate in the House on law and order in Sutton. In that debate, she branded Sutton

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as crime-ridden and a dangerous place to live. She was wrong, but she secured banner headlines in the tabloid press—popular papers that many people read—portraying Sutton as a dangerous place. That did great harm to the borough and to the livelihoods of many of the traders in Sutton town centre. Those who think that Sutton is a dangerous place today are as wrong as she was then.
My hon. Friend is absolutely right to highlight the fact that Sutton is the second safest borough in London. That is something to be pleased but not complacent about. Sutton is also the smallest borough in London and, with the advent of the borough-based policing system from 1 April, which I certainly welcome, we now have the opportunity to have a much clearer focus of police activity on the problems of the local communities.
We can now have one set of partners. My hon. Friend has already said something about partnership working, which has been established in Sutton for 10 years, with the council, the police and many other community interests working together to develop and invest in crime reduction and prevention, tackling both crime and the fear of crime with initiatives such as closed circuit television, home security, gating projects and youth diversion initiatives.
My hon. Friend referred to the incitement, through a magazine that is circulating in the area, to damage property with graffiti. I hope that the Minister will say something about that and about what the Government intend to do about those who supply the paint products that are used for graffiti. Back in March, there was an initiative in Sutton that tackled the perpetrators. There were 30 arrests and a substantial reduction in graffiti following the concerted effort by the police, the council and others.
That exercise showed clearly that some of the people who supply and sell the paints do it in a way that is totally irresponsible, displaying them in such a way as to entice and paying no regard to the use to which they can be put. I hope that something can be done to control more effectively the way in which the products are sold.
Having the smallest division in the Met has many advantages, some of which I have outlined, but it also has some potential downsides. As my hon. Friend said, the Sutton division is having to slim down to get down to the 254 officers that it will have as a borough division, losing 21 officers from the bigger division that it once was.
There is also undoubtedly concern arising from the current tenure policy, and it is hitting morale. I have had letters expressing concern from local officers. A review of the policy is under way, and it certainly needs to be changed. We must ensure that we make best use of the experience that officers gain through their careers, and of the investment that the police service puts into the development of specialist skills. That can be lost through an ill-thought-out transfer to an area of activity that does not exploit those skills.
Last week, Sir John Stevens told the Commons Press Gallery:
I need to maintain at least 25,600 officers if I am to police London with confidence. The people of London deserve nothing less than the best we can offer and if numbers continue to dwindle we are in trouble—make no mistake.
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He went on to say:
We do not have enough officers to police London with confidence. We have 25,480 officers—five years ago we had 28,000.
If the most senior police officer in London says that he does not have confidence that he can police London adequately, there must be cause for concern in my and my hon. Friend's constituencies about the fact that having only 254 officers does not give sufficient leeway to cover vacancies. We have already discussed the problems of recruitment and retention. With such a small number of officers, losing even one or two to vacancies has a disproportionate impact on the operational effectiveness of the division. That is why I hope that the Minister will say something about the tenure policy and the need to ensure that success in reducing crime is not rewarded by a further reduction in police numbers.
My hon. Friend rightly said that it is important, with a successful community safety strategy, never to be complacent. The crime figures in Sutton in the past year—for violent crime and street crime in particular—have been a cause for some disappointment and concern for my constituents, and for the council and the police, who need to redouble their efforts. They are doing that, but they also need to know that both the Greater London Authority, which is now the responsible body, and the Minister, who provides much of the funds, are mindful of the fact that a small police division needs to have a guarantee that its numbers will not be reduced any further.
12.46 pm
The Minister of State, Home Office (Mr. Charles Clarke): I congratulate the hon. Member for Carshalton and Wallington (Mr. Brake) on securing this debate. We have debated policing in London a great deal recently, both in Adjournment debates and in the annual debate last Friday, so if he will forgive me, I will focus on the issues that he has raised relating specifically to Sutton rather than on some of the more general issues.
Both the hon. Gentleman and the hon. Member for Sutton and Cheam (Mr. Burstow) began by talking about current policing working well and rebutting the approach that was only too characteristic of Lady Olga Maitland when she represented Sutton and Cheam. It is worth placing on the record the comparative crime position in Sutton because, as has been said, it is very good.
Incidents of violence against the person in Sutton were 6.5 per 1,000 of the population in the 12 months to September 1999, compared with the Metropolitan police average of 11.2; sexual offences were 0.4 per 1,000, compared with 0.7; robberies were 0.5, compared with 2.3; burglaries from a dwelling were 2.1, compared with 5.1; thefts of a vehicle were 2.9, compared with 4.2; and thefts from a vehicle were 5.2, compared with 7.8.
None of that is reason to be complacent in any way, but both hon. Gentlemen are absolutely right to highlight the fact that Sutton is the second safest borough in London and to join the police in the borough in campaigning to make it the safest.
Greater London has witnessed significant change this year in its government, with the creation of the GLA and of the independent Metropolitan Police Authority and, most importantly in my opinion, with the

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consequential boundary changes that have affected Sutton and other London boroughs significantly. The hon. Member for Carshalton and Wallington put the case well when he referred to the encouragement that the coterminosity of boundaries affords to a whole range of partnership working.
Many police officers have described our Crime and Disorder Act 1998 as one of the most significant pieces of legislation ever to affect policing. That is predicated on good partnerships, which are massively assisted by being able to have common boundaries and therefore common professional, political and strategic links. That is extremely important.
Obviously, there may be teething difficulties, as there have been big changes in the policing of the Sutton area, with the transfer of the officers who police the Epsom area to the Surrey police. No doubt there may be some confusion in the immediate period, but I know that the hon. Gentlemen and all the authorities concerned will do their best to ensure that the transition is as smooth as possible. The ultimate result of the transition will, I believe, be positive for the residents of Sutton, as it will be more generally across the Metropolitan police force. The change is important and significant.
The issues raised by the hon. Members for Carshalton and Wallington and for Sutton and Cheam are important. Boundary changes under the leadership of the borough's police commander, John Bainbridge, to whom I also pay tribute, have become a conduit for the review of policing styles in Sutton. He has decided to adopt a combination of intelligence-led and problem-orientated policing that is locally delivered in partnership with the borough council. That is an important development. The Metropolitan police have invested more resources and effort into problem-orientated partnership activity, as in their view it will achieve lasting reductions in crime and disorder. Such improvements would have been more difficult to deliver before the boundary changes.
I understand the concerns expressed on the reduction in police numbers. I understand from the commissioner that the boundary changes left Sutton relatively over-staffed, when other London boroughs were short of staff. The result was the transfer of about 20 officers in June and July to other London boroughs, as the hon. Member for Carshalton and Wallington said. The process has been handled by the force as sensitively as possible, and I hope that it will take place smoothly.
I understand that the boundary changes have resulted in a target in the Sutton borough area of 254 police officers by 31 March 2001. They will be supported by 75 civilian staff. We do not believe that that change will compromise the Met's policing style. Nor will it affect their operational activities. The policing of Epsom and the other areas that have been transferred to Surrey police is a matter for the chief constable of Surrey, who I am sure will ensure that Epsom is as well policed as previously. Indeed, Surrey's budget has been increased as a result of the boundary changes to ensure that the resources are available.
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Both the hon. Members for Carshalton and Wallington and for Sutton and Cheam referred reasonably to the issues of tenure, which are important to consider. The facts on tenure are straightforward. For reasons of not only specialism, to which the hon. Gentlemen referred, but community continuity, which is essential to partnership work, we have considered that it is important to address again the question of tenure. The commissioner is indeed doing so. The Metropolitan police service career management policy is about to be launched, which will replace the tenure arrangements—officer postings—with a Much more effective means of capitalising on the needs of the organisation and officers' particular professional skills.
I believe that the change on tenure will be widely welcomed—I certainly welcome it—and that it will address much more effectively the need for stability and the removal of uncertainty to which both hon. Gentleman referred. I hope that the change will be welcomed by all people throughout Sutton and by the hon. Gentlemen. I certainly commend it to them. It is part of a significant and substantial programme on which I am happy to give further details to them in writing if it would be helpful. It is an important part of the remotivation and rededication of the police service in London generally, and Sutton particularly, to the issues that have to be addressed.
Mr. Brake: I would be grateful if, as far as possible, the Minister confirmed in his letter the timetable—when consultation will finish and when any recommendations will be implemented.
Mr. Clarke: I am of course perfectly happy to do that.
I apologise to you, Mr. Deputy Speaker, for my unparliamentary behaviour in laughing out loud when the hon. Member for Carshalton and Wallington claimed the increase in Metropolitan police pay as a Liberal Democrat campaign success. I have heard many things so claimed in my time, both in my constituency in Norwich and nationally, but without taking away any credit for the vigorous way in which the hon. Gentleman puts the case, I assure him that the announcement by my right hon. Friend the Home Secretary on Friday was due to scientific assessment of a range of facts and the result of wide representation. I believe that it is out of order to laugh during a parliamentary debate, but I could not control myself. I try to be an extremely controlled individual, but I could not manage to be so on that occasion.
The hon. Member for Carshalton and Wallington referred to the Sutton parks constabulary, which is an important point. The constabulary is an important complement to the work of the Metropolitan police service in Sutton. The London borough of Sutton parks police work closely with Metropolitan police staff under a joint protocol for responses to incidents and the flow of intelligence. The parks police have been directly involved in the graffiti and under-age drinking initiatives. The constabulary has eight constables, and its work complements our continuing drive to develop partnership between police and local authorities.
In my city of Norwich, a similar parks police initiative under the neighbourhood warden and community constable scheme has had a major impact on improving

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the amenity of parks and on eliminating not only petty but sometimes more serious crime. I am therefore happy to commend the police, the council and Sutton parks constabulary for their work and look forward with interest to evidence of continued work in that area.
The graffiti campaign is important. I refer to the Adjournment debate on the matter on 27 March secured by the hon. Member for Twickenham (Dr. Cable). Indeed, in the policing debate on Friday, the hon. Member for Kingston and Surbiton (Mr. Davey) raised such points. I take the points seriously; they are important and we are seeking to address them.
Sutton's multi-agency approach between the police, local businesses and communities, schools and the Crown Prosecution Service seems to be effective. I understand that a database of tags has been developed and important links between graffiti artists and priority crimes have been established. A total of 50 reported allegations have been dealt with by various means.
I commend to the hon. Member for Carshalton and Wallington the development of new guidelines on closed circuit television in the context of his remarks on transport. I published them in February, and we gave, particular priority to CCTV in areas where there is concern about transport. That will help our integrated transport policy and with the issues that he raised. I cannot tell him anything on the question of the publishers of the magazine, although I will look into that. We have looked carefully into the serious issues concerning paints and the way in which we can deal with them.
Mr. Brake: The Minister has not responded to the issue about magazines and it was certainly not addressed in Friday's debate. I would be grateful, therefore, if he responded in writing.
Mr. Clarke: I will respond; I was not aware of the problem more generally.
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The hon. Gentleman raised the question of the 999 service, which is a serious concern. I dealt with that in my response to Friday's debate, so I will not go through the matter in detail except to say that many more staff have been recruited to address the issue. The issue of a major £1 billion investment in a completely new command and control system will be one of the earliest and toughest decisions for the new Metropolitan police authority. We in government have encouraged that. The Metropolitan police are working very hard on it and we acknowledge that serious issues need to be addressed.
As the hon. Gentleman knows, the target—I emphasise that such targets are not quotas—for ethnic minority recruitment is 25 per cent. by 2009, which is challenging. The majority of forces should meet their target in 10 years, but we have accepted that some may take longer. I have no other information to give him on that subject. We give great priority to it for the simple reason that, in cities across the United States of America, for example, when a community identifies with the police force that serves it, policing is strengthened in a variety of important and different ways.
On Bob Geldof and the mayor of London's campaign party, I must confess that I do not study the affairs, particularly the social life and plans, of my hon. Friend the Member for Brent, East (Mr. Livingstone) as closely as I perhaps should. However, I assure the hon. Member for Carshalton and Wallington that, under section 25 of the Police Act 1996, the commissioner has the power to charge for policing special events such as pop concerts. The matter is one for the commissioner, although any event that my hon. Friend might organise for his own pleasure and interest should not affect normal policing. Off-duty officers would often be used.
I have attempted to address the issues and conclude by commending Sutton for its extremely effective and strong safety record.

Paper Industry
1 pm
Mr. Jonathan Shaw: I am grateful for the opportunity to debate one of the United Kingdom's great manufacturing industries. As chairman of the all-party group on the paper industry, I can tell the Minister for Small Business and E-Commerce that those hon. Members with paper interests in their constituencies are concerned about the pressures that the industry faces and believe that the Government should be seen to take those concerns seriously. Therefore, my purpose today is to highlight the industry's valuable contribution to UK manufacturing and present its concerns to the House.
The UK has 98 pulp, paper and board mills, employing about 21,000 people. Those mills produce hundreds of grades of paper and board, which convert into a wide range of products for industry, commerce, education, communications, distribution and personal use in the home, together with a host of other specialty papers for industry. It is estimated that 12.7 million tonnes of paper were used in the UK last year. Sadly, more than half of that paper came from imports.
Mills in the UK are concentrated in Lancashire, the west country, central Scotland and my own county of Kent. In the Chatham and Aylesford constituency, the industry has an annual production of approximately 1.4 million tonnes of paper and board, making it the largest single concentration of production anywhere in the UK, employing more than 1,000 workers.
The industry is highly capital intensive. A new paper or board mill can cost well over £200 million and may take up to three years from the design stage to commission. To obtain an adequate return on such an investment, a mill needs to operate 24 hours a day. Such huge investments make the industry volatile to fluctuations in demand. If the economy slows down, so does the demand for paper.
The measures taken by my right hon. Friend the Chancellor have created the type of stability that the paper industry needs. Yet, as I said, the market is a European one, with 80 per cent. of imported paper coming from Europe. During the past three years, the value of the pound has led to job losses, mill closures and lost markets. Within such a competitive market, it can be difficult to claw back those markets.
The paper industry takes seriously its responsibility to the environment. During the past 20 years, the industry has reduced its water consumption by 70 per cent., its energy consumption per tonne of paper is falling year on year, and many of the UK operations have transferred their energy needs to combined heat and power plants. Earlier this year, following negotiations with the Government on the climate change levy, the industry agreed tough targets. Before her transfer to the Department for Trade and Industry, my hon. Friend the Minister was very much involved in those negotiations, particularly at the preliminary stage.
I welcome the outcome of the negotiations. The industry felt that the Government had a genuine desire to listen and it responded. But there remains some anxiety in the industry, in particular about what is good quality combined heat and power, because it is that
250WH
which will be exempt. It would be of great help if my hon. Friend were able to say when that matter will be clarified.
The industry knows that, if it is to compete, it must invest. Last year saw £300 million of capital expenditure, and, coupled with that investment, the industry has increased efficiency. Since 1989, output has improved by 43 per cent., and productivity per operative has increased by 140 per cent.
The paper industry is different from other traditional manufacturing industries in that capacity is increasing, not contracting. It is important to recognise that the industry has massive potential, and, with the right economic conditions, most of which are in place, it has the ability to beat all comers. As I say, despite technological advances, paper consumption has not declined but increased. The Government make their own contribution to that with their endless White Papers, Green Papers and consultation documents, all of which, I am sure that my hon. Friend will agree, make excellent and stimulating reading. Some may be better than others, but I shall leave it to my hon. Friend to say which. That also creates jobs.
In 1990, the UK consumed 1.8 million tonnes of newsprint, and in 1999, that had increased to 2.5 million tonnes. In the UK, we buy more papers and magazines than any other country in Europe, having recently overtaken Germany. I am bound to say that, indisputably, the best newsprint comes from Aylesford.
Given that the market is growing, with a forecast growth of 2 per cent. in the UK and between 1 and 3 per cent. throughout the rest of Europe, the question for us in the UK is whether our paper industry will be able to capture those markets and take advantage of the extra business and prosperity that that will bring. At present, we are at a distinct disadvantage.
Last year was a record year for production, with a turnover of £3.5 billion, yet the industry realised a pre-tax profit of just £150 million. The main problem facing the industry is the strength of the pound and the weakness of the euro.
The Graphical, Paper and Media Union, the main union representing workers in the industry, advises me that mills throughout Britain have closed, principally due to the strength of the pound. We have seen examples in Kent where profitable mills, such as Kimberley Clark Ltd. in Larkfield in my constituency and the Buckland mill, which produces the world famous Conqueror paper, owned by Argo Wiggins are in the process of closing operations, with about 400 job losses in Kent.
The industry knows that, to a certain extent, it must live with a strong pound. But to be told that it must be more efficient does not inspire confidence, particularly given the background of the figures to which I have referred. Cost-cutting and efficiency improvements have been made at the cost of many jobs—2,500 in the past two years, representing 10 per cent. of the work force. Importantly, they are well-paid jobs.
The Paper Federation of Great Britain recently held a referendum among its members regarding entry into the euro, and 60 per cent. favoured entry, believing that it was the right move for the industry, although obviously at the right rate. That view is shared by the GPMU.

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It is vital that industry takes part in the debate. When we have a referendum, industrial leaders will have more influence on what is a major democratic decision than ever before. People who work in mills, textiles, and in the car and steel industries will ask their employers and union leaders what it will mean for their industry, job security, ability to pay the mortgage and have a holiday. Those are the issues that matter and those are the arguments on which we should concentrate. I should like the Government to take a more robust line as the matter is taken forward.
I have spoken about the great efforts that the industry is making in investment, productivity, the environment, and about the pressures that it faces. However, it is also important to highlight some of its shortcomings. The industry has an appalling health and safety record, which puts mill owners in the United Kingdom to shame. Twelve deaths have occurred in the past six years and scores of serious accidents.
Two years ago, the industry set itself a target of reducing serious accidents by 50 per cent. It is widely acknowledged that progress has not been satisfactory. Earlier this year, George Beattie, the GPMU national officer, told a meeting of the chief executive officers of the paper industry that they were not improving enough or even at all. That is a damning indictment.
The industry kills. There are examples of people being allowed to work 34 12-hour shifts without a break. The industry asks people to work for 40 days without a day off. Paper mills are dangerous places, and the industry has not taken health and safety seriously enough. The culture is far too macho, and there is a lack of interest in health and safety. The consequences are fatalities. People are dying in the industry.
There must be change, and I hope that the industry will take its commitments to targets seriously. There must be a wake-up call, and a sea change in the industry's attitude. The targets that the industry has set are not unrealistic because there are examples of good practice throughout the country in various mills, which have reduced their accident rates by 50 per cent. If some can do it, others can learn and follow their example.
Against the background of appalling safety, the GPMU will not sit back. I endorse its campaign themes. Its message is:
We are here to work, not to die. Say no to unsafe jobs.
That is a powerful message, and I hope that mill operators will take it seriously. There is a firm basis on which employers and unions can improve their health and safety record: a positive and productive relationship between the two sides. The relationship between the unions and management could be held up as a model of excellent industrial relations. It is therefore possible to use that relationship to ensure that the health and safety record matches the technological, productivity and environmental advances.
The industry is good for Britain. With the right economic conditions, it can be a world beater because it has a skilled and dedicated work force. The Government need to listen and understand the anxieties and do everything in their power to create the right economic conditions for it to thrive. If we do that, it will thrive.
1.13 pm
The Minister for Small Business and E-Commerce (Ms Patricia Hewitt): I warmly congratulate my hon. Friend the Member for Chatham and Aylesford (Mr. Shaw) on securing the debate and on his election as the new chairman of the all-party group on the paper industry. I also congratulate him on his excellent speech, which was made not only on behalf of his constituents who work in the industry, but on behalf of the whole industry.
I checked the parliamentary online information system—POLIS—and found that the paper industry was last debated in the House 14 years ago. I appreciate that my hon. Friend spoke on the importance of recycling in the industry in the Budget debate earlier this year. However, it is extraordinary that such an important industry has not been the subject of a debate before today. I therefore especially congratulate my hon. Friend on securing the debate.
I strongly agree with my hon. Friend's remarks on the industry's importance. This country has an extraordinary tradition of excellence and self-sufficiency in paper and board making. Fifty years ago, we were not only wholly self-sufficient in producing paper and board, but a major exporter. For a variety of reasons, that position has been steadily eroded until a nadir was reached in the mid-1980s. Employment in the industry has fallen from 52,000 in 1980 to less than half that number today.
The shrinking in employment does not provide an accurate view of what has happened in the industry. I am glad that my hon. Friend emphasised its productivity improvements and output growth. Both have been striking. In the past two decades, total annual production has nearly doubled from 3.8 million tonnes to 6.6 million tonnes.
There is still significant employment in the industry. As my hon. Friend said, some 21,000 employees work in fewer than 100 mills in several different parts of the United Kingdom, including, of course, my hon. Friend's constituency. If one takes the wider definition of the industry by the Office for National Statistics—it includes pulp, paper and paper products—the sector contributes more than £4 billion of value added to our gross domestic product. That is comparable to the manufacture of textiles and aircraft, and greater than the manufacture of steel and computer hardware. We are therefore considering a sizeable, high-productivity, high-technology manufacturing sector.
The industry's other distinctive feature, to which my hon. Friend referred, is its position not only in a European but a global marketplace. That is clearly reflected by the industry's ownership structure, with some 60 per cent. of capacity owned by overseas interests, including Nordic and North American interests. My hon. Friend rightly mentioned that we import more than half our total paper requirements. We are in a major market; our consumption is the fifth largest in the world and, as my hon. Friend said, it is growing. Imports are also growing fast. Exports have remained steady, but imports are growing rapidly. Our ability to recover paper from the urban forest—the newsprint and other forms of paper that have already been used—is crucial to our future competitiveness.

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The strong level of investment that continues in the industry is welcome. It has often been encouraged by Government grants. In the last three financial years, 93 offers of regional selective assistance grant have been made and accepted. They total some £19 million of Government support for investment in paper, paper products and packaging. Of course, the total value of the investments is far greater. That is encouraging for future productivity and the management's confidence in the capacity of the UK industry. The large amount of inward investment in the tissue products sector is especially welcome, as is investment in environmental improvements.
Although the industry faces competitive challenges in a global marketplace, and employment in the sector is contracting, it is fundamentally in good shape. Output has continued to increase, and productivity has been increasing substantially.
I should like to say more about the growing importance of recycling in the paper industry. As my hon. Friend knows, the so-called waste paper utilisation rate—the proportion of our paper production that is derived from waste paper and board—is among the highest in the world, at around 65 per cent. Aylesford uses only recycled stock for its newsprint production.
The other side of the coin, the recycling rate—the proportion of our total waste paper that is collected and recycled—is disappointing. It is less than half the utilisation rate. One of the reasons is that we consume far more paper and board than we manufacture. Consequently, several million tonnes of paper are landfilled each year. That is clearly a wasted opportunity for environmental sustainability and industrial competitiveness.
Waste Strategy 2000, the waste strategy for England and Wales, which we published in May, sets out the various steps that we are taking to increase the recycling rate. It has been good to see the response from the paper sector to the White Paper and the recent call for proposals under the recycling programme of the Department of Trade and Industry to support research and development, and to underpin projects that are designed to increase demand for recycled materials. We are now in the final stages of assessing those projects.
Mr. Shaw: This subject is close to my heart, and I spend much time lobbying every Minister about the need to provide more facilities so that local authorities can collect their waste in a way that means that it can be recycled. Does my hon. Friend agree that the three mills that can take newsprint and magazines are full to capacity and that no new mill has been built for nearly five years? The mills that have come on stream have been in Europe. It is a European market, so there is only so much capacity. We need to increase capacity and it is essential that the Government provide assistance for that. Without that, the strategy will not work.
Ms Hewitt: My hon. Friend makes an important point and I am well aware of his long-standing interest in the issue and the proposals that he has made to
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colleagues and myself. In the Waste Strategy 2000, we announced that we would set up the waste and resources action programme—WRAP—to overcome some of the barriers to reuse and recycling. The objective of that new body, which will be established later this year, will be to promote more sustainable waste management generally, but, in the first instance, to focus on developing markets and end uses for secondary materials. I hope that it will be able to tackle some of the market failures that exist in recycled materials, especially newsprint. Both the Department of Trade and Industry and the Department of the Environment, Transport and the Regions have committed resources to that new organisation to give some muscle to the strategy.
My right hon. Friend the Minister for the Environment recently reached an agreement with the newspaper publishing industry on increasing its recycled content targets. I am sure that my hon. Friend agrees that that was an important development.
My hon. Friend referred to the climate change levy that will be introduced next April. That levy is a key element in our strategy to tackle the issue of global climate change and to deliver on our international and domestic targets to cut emissions of greenhouse gases. We have worked hard with industry—the paper industry and more broadly across manufacturing—to ensure that we get the design of the CCL right to achieve our environmental objectives in ways that do not damage, and indeed could enhance, the competitiveness of British industry.
As my hon. Friend will be aware, the Chancellor announced important revisions to our original proposals in both his pre-Budget report last November and in his Budget statement in March. When we announced the levy—I was involved as Economic Secretary to the Treasury—we made it clear that we would take especial notice of the position of the energy-intensive sectors that are subject to intense international competition, including, of course, the UK paper industry. I am therefore pleased that the Paper Federation of Great Britain, on behalf of its members, has negotiated with the Government an energy efficiency agreement which will qualify the industry for an 80 per cent. discount on the levy. That is an important step forward for the industry's competitiveness and the wider objective of improving environmental sustainability.
My hon. Friend rightly referred to the exemption from the levy for good quality combined heat and power. My right hon. Friend the Minister for the Environment announced on 17 May how good quality would be assessed, using a simple and definitive methodology called CHP quality assurance. That followed valuable consultations with the paper industry and other CHP users. My right hon. Friend will issue the full details in the next few days, and they will be circulated to all companies using CHP.
It is worth stressing that the CHP plants that have been approved during and since the review of energy sources for power generation include four paper mill developments, totalling nearly 350 MW. I warmly congratulate the industry on those multi-million pound investments in new paper production technology.

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My hon. Friend mentioned the issue of the exchange rate and the weakness of the euro. We know that that is causing difficulties for British industry, particularly paper and board manufacturing, 75 per cent. of whose exports go to the European Union. As my right hon. Friend the Chancellor has said on many occasions, the problem is the weakness of the euro, rather than the overall strength of sterling. Indeed, sterling had been stable for four years against the dollar, although more recently it has fallen to a six-year low against the dollar. The Government must take a long-term view of how to achieve the economic stability that, as my hon. Friend began by saying, is crucial to investment and confidence in the paper and other industries. We will not allow short-term pressures to risk returning us to the days of boom and bust and a constant change in policy that made investment in the UK's productive capacity so inadequate.
It is worth remembering that in the paper industry, and more broadly across manufacturing, we are seeing improvements in output, productivity and exports. Although manufacturing employment has fallen by some 160,000 jobs in the past three years, we should remember the period between 1979 and 1997, when manufacturing employment fell, on average, by 140,000 every year. The scale is very different today.
As my hon. Friend will be aware, the Government's policy on the single currency remains as it was when my right hon. Friend the Chancellor of the Exchequer set it out in October 1997. The determining factor that must guide any Government decision is whether the economic case for the UK joining is clear and unambiguous. We have set out five economic tests that have to be met before any decision to join can be taken, and we have made it clear that once the Government have made a
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decision, it will be put before Parliament, but that the final decision must be made by the people in a referendum.
I shall end, as did my hon. Friend, on the issue of the health and safety performance of the industry. I am glad that he tackled so trenchantly the appalling health and safety record that mars the otherwise highly impressive record of productivity and investment. I know from discussions with the Graphical, Paper and Media Union how hard it has worked with management, in a model of partnership with industry, to tackle that problem. The accident rate in the paper industry has persistently remained some 50 per cent. higher than the average achieved by all manufacturing industry. That record is simply not good enough.
For the past two years, the industry, the unions and the Health and Safety Executive have co-operated in a major initiative, strongly backed by Ministers in the Department of the Environment, Transport and the Regions. The initiative was designed to reduce accidents by 50 per cent. over three years, but the accident figures remain stubbornly high. That is unacceptable. We expect from the owners and management of the mills a commitment to safe working practices, and a culture of safety and continuous improvement in which people's health and lives are not regarded as expendable commodities in the quest for higher output. That safety record is the one blot on the record of an industry that is enormously important to this country, which has made real improvements in investment and productivity and which certainly has the backing and the practical support of the Government.
Question put and agreed to.
Adjourned accordingly at half-past One o'clock.

NORTHERN IRELAND

  Shootings
  Mr. McNamara
  To ask the Secretary of State for Northern Ireland if he will make a statement on the shooting dead of James Alfred Cornhill on 19 April. [123057]

  Mr. Ingram
  No. The matter is currently under investigation and the investigation is being supervised by the Independent Commission for Police Complaints.

  Mr. McNamara
  To ask the Secretary of State for Northern Ireland what was the result of the ICPC inquiry into the shooting dead of Robin Charles Scott Maxwell in January 1994; and what were the findings of the coroner's inquest. [123056]

  Mr. Ingram
  The Independent Commission for Police Complaints issued a statement of satisfaction as to the conduct of the investigation.

  A Coroner's inquest found that, on the evening of 27 January 1994 two masked men entered the High Trees Garage with the intention of robbing the premises. The owner, Mr. Weir, spotted the robbers and alerted two policemen who were hidden in the store at the rear of the shop. On entering the shop the policemen were confronted by the two robbers, one carrying a cudgel and one holding a firearm to Mr. Weir's head. The policemen issued a warning and the robber who held the cudgel fled from the premises pursued by Constable Fox. The other robber, Robin Charles Scott Maxwell, turned and pointed a weapon in the direction of Constable 'A', who, fearing that his and the owner's life was in danger, discharged his firearm, killing Mr. Maxwell almost instantaneously. The jury found that the police had no plan to intercept or arrest the robbers before their arrival at the premises.

  Extraditions
  Mr. William Ross
  To ask the Secretary of State for Northern Ireland how many persons sought by the(a) RUC and (b) other UK police forces were extradited from the Irish Republic to the UK in (i) each of the previous three years and (ii) the current year. [125543]

  Mr. Mandelson
  The table provides details of the numbers of persons sought by the RUC and other UK police forces who have been extradited from the Irish Republic to the UK in the last three years and the current year. The figures include both terrorist and non-terrorist cases. It should be noted that the figures for England and Wales are not necessarily complete, as the information is not collated centrally.
  496W
  Given the complex nature of extradition proceedings, it is not possible to compare directly the number of extradition requests with the number of individuals extradited in any given year. With appeal proceedings the process may take a number of years to be completed.

  Applications made

  Extradited

  Great Britain

  1997

  22

  10

  1998

  29

  16

  1999

  17

  11

  2000

  4

  1

  Northern Ireland

  1997

  8

  3

  1998

  6

  6

  1999

  6

  3

  2000

  1

  1

  Police
  Mr.Woodward
  To ask the Secretary of State for Northern Ireland if he will make a statement on how arrangements for Best Value will be made within the proposed new structure for policing under the Police (Northern Ireland) Bill. [126577]

  Mr. Ingram
  The Police (Northern Ireland) Bill will provide for the new Policing Board to make arrangements to secure continuous improvement, or 'Best Value', in the way in which its functions are exercised. The Policing Board, in its capacity as a high level regulatory body, will have lead responsibility for economy, efficiency and effectiveness arrangements. 'Best Value' will provide a framework for the Board to deliver continuous improvement, and the Board will be held accountable to the people of Northern Ireland for ensuring that they achieve 'Best Value' from the police service.

  The Government do not wish to be prescriptive about the exact arrangements. It will be for the Policing Board, in association with the Chief Constable, to determine the precise arrangements for managing 'Best Value', in accordance with best practice elsewhere.

AGRICULTURE, FISHERIES AND FOOD

  BSE
  Mr. Drew
  To ask the Minister of Agriculture, Fisheries and Food what access he has to the work of the Harvard University Center for Risk Analysis and United States Department of Agriculture on risk analysis relating to BSE. [123392]

  Ms Quin
  [holding answer 25 May 2000]: Officials of my Department have been contacted by members of the Harvard University Center for Risk Analysis team, and have assisted them by providing information on request. The team also visited the UK in 1999 and spoke to both officials and external experts. We understand that they were gathering information to determine their own approach to BSE; not undertaking a risk analysis of the UK situation.

  Farm Production Methods
  Mr. Robertson
  To ask the Minister of Agriculture, Fisheries and Food what discussions he has had with his EU counterparts about the inspection of their farm production methods with particular reference to welfare, hygiene and environmental aspects of production; and if he will make a statement. [126954]

  Mr. Morley
  EU standards are negotiated and adopted in these areas by the Council of Ministers. Once EU measures have been adopted, checking that member states have taken proper steps to implement and enforce them is the responsibility of the European Commission. There have been no discussions with ministers from other member states on these matters recently, although at last week's Council of Ministers my right hon. Friend the Minister strongly urged his colleagues to enforce EU rules on the welfare of livestock in transit strictly, as we do in the United Kingdom.

  Milk
  Mr. Robertson
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the EU intervention level for milk. [126958]

  Ms Quin
  There is no intervention price for milk under the CAP milk regime. The market is supported by means of intervention prices for butter and skimmed milk powder. The intervention price for butter is 3,282 euros per tonne and 2,055.2 for skimmed milk powder. The intervention prices expressed in sterling can vary on a daily basis since they are converted into national currency using the daily sterling/euro market rate of exchange.

  EU Intergovernmental Conference
  Mr. Bercow
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on his Department's negotiating objectives for the Nice Treaty. [127198]

  Mr. Morley
  The Government set out their objectives for the IGC in the White Paper presented to Parliament by the Foreign Secretary on 15 February.

  Common Fisheries Policy
  Mr. Bercow
  To ask the Minister of Agriculture, Fisheries and Food if he will list projects being assessed by his Department for potential submission for funding under EU budget line B2–903A: strengthening the dialogue with the fishing industry and groups affected by the Common Fisheries Policy. [127189]

  Mr. Morley
  Budget line B2–903A covers the costs of:

  (a)Meetings arranged by European trade organisations to prepare for meetings of the Advisory Committee on Fisheries and Aquaculture, which advises the European Commission on matters concerning the Common Fisheries Policy;

  (b)Regional workshops organised by the European Commission to address particular issues of local fisheries management; and

  (c)Disseminating information and explanatory material on the Common Fisheries Policy to the fishing industry and others with an interest.

  Applications for funding of national projects are not invited under this budget line.
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  Mr. Gill
  To ask the Minister of Agriculture, Fisheries and Food if he will make a statement on the joint policy proposed by the Scottish Fishermen's Federation and the National Federation of Fishermen's Organisations, A New Vision for Europe's Fisheries; and what assessment he has made of whether implementation of that policy would require the unanimous agreement of the Council of Ministers. [127843]

  Mr. Morley
  [holding answer 26 June 2000]: I refer the hon. Member to the replies I gave to the hon. Member for Teignbridge (Mr. Nicholls) on 22 June 2000, Official Report, columns 302–04W.

  Regional Offices
  Mr. Steen
  To ask the Minister of Agriculture, Fisheries and Food what the staffing levels are in each of his Department's(a) regional offices in England and Wales and (b) offices in (i) Bristol, (ii) Exeter and (iii) Plymouth. [127730]

  Mr. Morley
  [holding answer 26 June 2000]: I refer the hon. Member to the reply given to my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cousins) of 9 June 2000, Official Report, column 427W.

  This sets out the number of substantive staff on a full-time equivalent basis at each of the MAFF Regional Services Centres, on 1 May 2000, including the offices at Bristol and Exeter. There are currently seven staff based at the Ministry's District Fisheries Office at Plymouth.

  Mr. Steen
  To ask the Minister of Agriculture, Fisheries and Food how much time officials in each of his Department's regional offices have spent in meetings with farmers in each of the last five years. [127731]

  Mr. Morley
  [holding answer 26 June 2000]: The information in the form requested is unavailable. However, in 1999, farmers made some 79,000 visits to the nine MAFF Regional Service Centres, the equivalent of around 5 per cent. of the total estimated farmer contacts with the RSCs.

  Diversification
  Mr. Breed
  To ask the Minster of Agriculture, Fisheries and Food if he will list the organisations that can advise farmers on diversification. [128057]

  Mr. Morley
  There are numerous organisations, both in the public and private sector, that can provide business advice to farmers on diversification. Guidance on these sources of advice will be set out in a new booklet on farm diversification to be published by this Department later this summer as part of the Action Plan for Farming.

  Crop Contamination
  Mr. Breed
  To ask the Minister of Agriculture, Fisheries and Food what compensation he will make available to organic farmers whose crops and organic status are at risk from contamination from genetically modified crops on neighbouring farms; and if he will make a statement. [128044]
  499W
  Mr. Morley
  There is currently no commercial cultivation of genetically modified crops in the UK. Compensation for any detriment to a farmer as a result of activity on a neighbouring farm would be a matter between the farmer and those responsible for the activity.

  International Whaling Commission
  Mrs. Fitzsimons
  To ask the Minister of Agriculture, Fisheries and Food what the position of the United Kingdom will be at the forthcoming meeting of the International Whaling Commission. [128441]

  Mr. Morley
  The International Whaling Commission (IWC) will be holding its 52nd Annual Meeting in Adelaide between 3 and 6 July. I will be attending.

  At this meeting I will be confirming that the UK remains strongly opposed to whaling, and that our ultimate aim is to secure a permanent, worldwide ban on all whaling, other than some limited aboriginal subsistence whaling. We will be seeking to build upon the successful outcome of the recent CITES meeting where all whale downlisting proposals were rejected and the primacy of the IWC reaffirmed.

  There will be further discussions of proposals put forward by Ireland in 1997 for a package of measures on whaling. The Irish proposals would involve a ban on all whaling, including scientific whaling, outside coastal waters (in effect creating a global ocean sanctuary), with a possibility that countries might authorise whaling under IWC rules within their own coastal waters; there would be a ban on international trade in whale products. In these discussions we will maintain our previous position on these ideas: while we are prepared to discuss constructively all ideas for improving whale conservation, and strongly support some elements of these proposals, we have significant reservations about others, in particular those relating to coastal whaling. Nevertheless we are prepared to consider interim solutions on the way to our ultimate destination provided that these deliver very real benefits to whale conservation.

  It is, however, unlikely that any progress will be made on the Irish proposals, as the whaling countries and their allies remain opposed to key aspects of them. Japan, in particular, has demonstrated that it is not prepared to consider ending scientific whaling or a ban on international trade in whale products. In these circumstances, the United Kingdom will continue to support the alternative ways of achieving our aims that we outlined at least year's meeting and subsequently reported to the House on 9 June 1999, Official Report, columns 348–50W.

  A key element of our approach is support for the creation of regional sanctuaries, and we will be strongly supporting a proposal put forward by Australia and New Zealand to create a South Pacific Whale Sanctuary. The proposed sanctuary will afford greater protection to whales in a highly important breeding and feeding area, and one through which many other great whales migrate. The proposal has been endorsed by South Pacific Forum leaders.

  At previous IWC meetings the UK, together with a majority of IWC members, has consistently criticised the whaling operations authorised by Japan under special permits—so called "scientific" whaling. It is, therefore,
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  very disappointing that Japan has presented proposals, for discussion in the IWC Scientific Committee, to extend these whaling operations to cover two further species, Sperm and Bryde's whales. Under the IWC's parent convention, IWC approval for these proposals is not needed and it is for Japan to authorise whaling under special permit., We will, nevertheless, be registering the Government's strong objection to these proposals and will be urging Japan to withdraw them.

  There will be further discussion of The Revised Management Scheme (RMS), which is being developed to regulate all aspects of any future commercial whaling. The IWC meeting will be preceded by a two day working group focusing, in particular, on the Inspection and Observation Scheme which would form an integral part of the RMS. It is important for the credibility of the IWC for it to be seen to be making progress on the development of the RMS, and the UK will continue to participate constructively in this work. We will be seeking a comprehensive RMS that would ensure that, if commercial whaling was ever authorised in future, it could not pose a threat to whale conservation and that catch limits and other rules would be strictly observed. The Government will also be making it clear that our participation in this work is without prejudice to our opposition in principle to commercial whaling.

  As we have at previous meetings, the UK will again be expressing its concern about the cruelty involved in whaling; we also intend to raise the inhumane methods used and lack of regulation in the hunts for small cetaceans, such as dolphins and porpoises, that take place in some countries. Other topics on which we hope to make progress include the impact of environmental change and pollution on whales and other cetaceans and the encouragement of whalewatching.

  We will report the outcome of the meeting to Parliament.

DEFENCE

  Exposure Facility
  Mr. Matthew Taylor
  To ask he Secretary of State for Defence if he will place in the Library a copy of the safety regulations covering the new exposure facility which was opened in February. [127137]

  Dr. Moonie
  I will write to the hon. Member and a copy of my letter will be placed in the Library of the House.

  TRACER Programme
  Mr. Hancock
  To ask the Secretary of State for Defence how much his Department has paid to date on the joint project to develop a system of Tactical Reconnaissance Armoured Combat Equipment; what is the planned final cost; if this project is running on time and at agreed budget levels; and if he will make a statement. [127181]

  Dr. Moonie
  This is a matter for the Chief Executive of the Defence Procurement Agency. I have asked him to write to the hon. Member.
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  Letter from Robert Walmsley to Mr. Mike Hancock, dated 28 June 2000:

  I am replying to your question to the Secretary of State for Defence on the collaborative Tactical Reconnaissance Armoured Combat Equipment Requirement (TRACER) programme. This matter falls within my area of responsibility as Chief of Defence Procurement and Chief Executive of the Defence Procurement Agency.

  The joint programme with the United States to develop TRACER was formally launched with the signature of the programme Memorandum of Understanding in July 1998. Contracts for the current Project Definition phase were awarded to two UK/US industrial consortia in January 1999. These contracts will be of 42 month duration and are due to complete in July 2002. This phase of the programme is proceeding to schedule and within budget. UK expenditure on the joint programme to 31 March 2000 amounted to £30 million and the current estimate of the overall cost to the UK of this phase is £120M at current prices.

  UK involvement in phases beyond Project Definition will be subject to further approval and will take account of parallel studies into the use of Unmanned Air Vehicles for battlefield reconnaissance. A realistic estimate of the total cost of the project is not possible in advance of the decisions on the balance of investment between platforms ie armoured reconnaissance and Unmanned Air Vehicles.

  A feature of defence procurement is the need to accommodate new sophisticated systems within the resources expected to be available. Conflicting demands on the available resources inevitably lead to priorities being kept under review. The current budgetary review process in the US, which could have implications for the TRACER programme, is being closely monitored, and we are in regular contact with the US DoD.

  Procurement Spending
  Mr. Hancock
  To ask the Secretary of State for Defence what was the percentage of GNP spent on defence procurement in each of the last 10 years; and if he will make a statement. [127176]

  Dr. Moonie
  Changes introduced under the European System of Accounts (ESA) 95 mean that GNP is no longer calculated. Gross National Income (GNI) is now recognised as the accepted, more accurate, standard and this has been used to provide the comparison with expenditure on Defence Equipment set out in the table. The GNI figure for 1999–2000 will not be available until the end of June and an updated reply will be made available at that time.

  Financial year

  Expenditure on defence equipment £ million

  GNI £ million

  Expenditure on defence equipment as a percentage of GNI

  1998£99

  9,785

  866,461

  1.13

  1997£98

  9,003

  822,720

  1.09

  1996£97

  9,100

  771,837

  1.18

  1995£96

  8,537

  723,960

  1.18

  1994£95

  8,819

  689,421

  1.28

  1993£94

  9,200

  646,273

  1.42

  1992£93

  8,711

  609,755

  1.43

  1991£92

  9,758

  585,515

  1.67

  1990£91

  8,838

  556,784

  1.59

  Decorations
  Mr. Wigley
  To ask the Secretary of State for Defence under what circumstances service decorations can be withdrawn from former members of the armed forces. [127875]

  Dr. Moonie
  As laid down in the Statutes and Royal Warrants which govern official British awards and at the discretion of the Defence Council, arrangements exist for the forfeiture of awards by any officer or member of the military forces, or former officer or member of the military forces. These include Orders, decorations and medals. Normally, forfeiture may be liable after conviction of offences by court-martial or by the Civil Power. The awards forfeited vary according to the gravity of the offence. The Statutes and Royal Warrants are reproduced in the Queen's Regulations for the Armed Services, copies of which are in the Library of the House.

  Barracks
  Mr. Fabricant
  To ask he Secretary of State for Defence (1) if the Whittington Barracks near Lichfield will be designated a core location for the armed forces in the Midlands and the North; and if he will make a statement; [127222]

  (2) when he expects to announce the names of the barracks to site the Army Training Regiment following completion of the review. [127470]

  Dr. Moonie
  The Army Training and Recruiting Agency (ATRA) is currently conducting a review into its strategic development over the next few years. This work will be taken forward in close co-operation with other studies being undertaken into the provision of training and the management of our training estate. Work is still at a very early stage and no decisions have been taken as to which sites will remain core ones within ATRA.

ENVIRONMENT, TRANSPORT AND THE REGIONS

  Incinerators
  Mr. Loughton
  To ask the Secretary of State for the Environment, Transport and the Regions what are the maximum toxic emission levels permitted for incinerators, broken down by individual toxic substances. [123488]

  Mr. Meacher
  [holding answer 23 June 2000]: Under Part I of the Environmental Protection Act 1990, emissions to air, water and land from larger plant regulated by the Environment Agency and emissions to air from medium and small plant regulated by local authorities are controlled through permits which impose emission limits on the basis of the site-specific BATNEEC principle (Best Available Techniques Not Entailing Excessive Cost) and relevant European legislation specifying emission limits. There are currently two municipal waste incineration Directives (89/369/EEC and 89/429/EEC) and a hazardous waste incineration Directive (94/67/EC) which specify emission limits, and a further Directive (Common Position (EC) No 7/2000) which will replace these earlier Directives and cover virtually all incineration plant is currently in the final stages of negotiations.
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  This latest proposed Directive would result in a ten-fold tightening of the municipal waste incinerator dioxins standard so that incinerators covered by it would be required to emit no more than 1 billionth of a gram of dioxins in a cubic metre of emissions to air.

  Refrigerants
  Mr. Brady
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment his Department has made of the risks to public safety from the use of volatile and flammable hydrocarbons as refrigerants. [126979]

  Mr. Meacher
  Health and Safety Executive carries out general research on the risks from flammable substances as part of the development of guidance and safety standards. However, no specific assessment has been made of the risks to public safety from the use of volatile and flammable hydrocarbons as refrigerants.

  Land Remediation
  Dr. Fox
  To ask the Secretary of State for the Environment, Transport and the Regions how much of the contaminated land, required to satisfy his proposals for house building up to 2016, he estimates will be remediated using(a) process technologies and (b) excavation to landfill. [127581]

  Mr. Mullin
  One of the main objectives of national planning policy for housing (PPG3) is that authorities make far better use of previously developed land and buildings for meeting the country's housing needs. The Government have set a target that by 2008 60 per cent. of additional housing should be provided this way. It is not possible to forecast precisely how much of the previously-developed land used by 2016 will be contaminated land, nor how that land will be remediated.

  However, the Environment Agency has carried out a survey of remediation activity in England and Wales from January 1996 until December 1999. Information was collected from local authorities, industry and the National House-Building Council (NHBC). The survey was not statistically representative of all the remediation which took place during that time, but it does give an indication of current practice.

  Of the 367 sites identified from local authority and industry sources, 75 per cent. involved excavation and disposal off site and 21 per cent. involved process based methods.

  Of the 1,189 sites recorded by the NHBC, civil engineering techniques (including excavation and off site disposal, site re-grading and containment) were used on 95 per cent. of sites. Process based methods were used on 5 per cent. of sites.

  Pollution Prevention and Control
  Mr. Green
  To ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the role of environmental impact assessments in the application of Pollution Prevention and Control Regulations; and if he will make a statement. [127579]
  504W
  Mr. Hill
  Installations covered by the draft Pollution Prevention and Control Regulations may also require an environmental impact assessment (EIA) under the planning system. The Regulations require the regulator to take account of any information supplied in the context of an EIA in determining the permit application. We are considering the case for reviewing the links between the planning and pollution control systems. A Regulatory and Environmental Impact Assessment for the Regulations has been placed in the Library of each House of Parliament.

  Taxis (Wheelchair Access)
  Dr. Whitehead
  To ask the Secretary of state for the Environment, Transport and the Regions what percentage of licensed hackney carriages in England and Wales were wheelchair accessible in(a) 1997, (b) 1998 and (c) 1999. [127583]

  Mr. Hill
  The licensing of hackney carriages—taxis—is a matter for individual local licensing authorities. Many of them have policies which require all or part of their fleet to be accessible to disabled people, for example all London taxis (some 19,000) were required to be accessible from 1 January 2000. Information on the number of vehicles that are accessible is not, however, held centrally.

  Dr. Whitehead
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to ensure that licensed private hire cars are wheelchair accessible. [127582]

  Mr. Hill
  We have no powers to require that licensed private hire vehicles be wheelchair accessible. The powers provided in the Disability Discrimination Act 1995 to introduce accessibility regulations only apply to licensed taxis, buses and coaches and rail vehicles.

  Our statutory advisers—the Disabled Persons Transport Advisory Committee—will, however, be considering the issue of access to private hire vehicles as part of their work programme.

  Regional Planning Guidance (South-East)
  Mrs. Gillan
  To ask the Secretary of State for the Environment, Transport and the Regions if additional sums were allocated to county councils for the purpose of distributing copies of the draft regional planning guidance for the South-east. [127799]

  Ms Beverley Hughes
  No extra finance was allocated to local authorities to distribute the document and leaflets to the libraries in their area. It is normal practice for such consultation documents to be sent to the county councils for distributing through their own distribution system to the local libraries. Further copies were sent by the Government Office to any individual or organisation that requested them.

  Mrs. Gillan
  To ask the Secretary of State for the Environment, Transport and the Regions how many copies of the draft regional planning guidance for the South-east were sent to Buckinghamshire County Council. [127800]

  Ms Beverley Hughes
  Initially 50 documents and 150 leaflets were sent. Following a subsequent request from Buckinghamshire County Council during the consultation period on Proposed Changes to Draft Regional Planning Guidance (PRG9), further copies were sent.
  505W
  Mrs. Gillan
  To ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 14 June 2000,Official Report, column 640–41W, on Regional Planning Guidance (South-east), if a copy of the draft regional planning guidance for the South-east was provided for every branch library in Buckinghamshire; and for what reason copies of the draft regional planning guidance for the South-east were not distributed direct from his Department to branch libraries in the South-east. [127832]

  Ms Beverley Hughes
  It is normal practice for the County Councils to distribute consultation documents through their distribution system to libraries within their area. Further copies were sent by the Government Office to any organisation or individual that requested them.

  Railtrack
  Mr. Martlew
  To ask the Secretary of State for the Environment, Transport and the Regions what discussions he has had with Railtrack concerning the possibility of the Government taking a share in the company; and if he will make a statement. [127805]

  Mr. Hill
  In the context of developing our 10 Year Plan for Transport, we have discussed with Railtrack and others ways of increasing investment in the railway. Our plans for rail investment will be set out in the 10 Year Plan, to be published next month, and in the shadow Strategic Rail Authority's subsequent strategic plan.

  Rail Fares
  Miss Geraldine Smith
  To ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the powers of the Rail Regulator with regard to fare increases. [127643]

  Mr. Hill
  Responsibility for the regulation of rail fares lies with the Franchising Director not the Rail Regulator. Under the Railways Act 1993, the Franchising Director has powers to regulate fares where it is in the interests of passengers to do so. He has imposed a cap on the price of key fares, and operators are not able to increase those fares overall above the rate of inflation. Since January 1999, the key fares have been capped at 1 per cent. below the rate of inflation for each of the next four years. The key fares include all Saver tickets, unrestricted standard returns where there are no Savers, and all standard weekly season tickets. Other fares, including discounted fares for off-peak travel, are set by the train operators.

  Busking and Begging
  Mr. Jim Cunningham
  To ask the Secretary of State for the Environment, Transport and the Regions what measures are being taken to tackle busking and begging on or near public transport. [127215]

  Mr. Hill
  [holding answer 26 June 2000]: The problem of begging is a concern to all public transport operators and in particular the railways and London Underground. They are trying to increase public awareness of the associated problems and announcements are made on stations and trains requesting that the public refrain from giving money to beggars.
  506W
  Various powers are available to the police forces dealing with both begging and busking under the Vagrancy Act, the Children and Young Persons Act and specialist railway legislation. Police forces adopt a proactive approach, especially where issues of safety are concerned, and have an agreed policy with the Crown Prosecution Service to charge and prosecute first time offenders where safety may be compromised.

  A multi-agency group has also been formed to tackle the issues of begging and busking and meets four times a year. This group includes the Metropolitan Police, the British Transport Police, Thames Valley Constabulary, Social Services, Child Protection Teams and the Asylum Seekers Co-ordinator. They are currently producing a joint strategy to deal with begging.

  The railway operators, London Underground and other light rail operators have submitted new byelaws to the Secretary of State for confirmation and these are currently being considered. The new byelaws include provisions to allow the operators to license buskers on their property. It is hoped that this measure will allow them easier control of the problems associated with busking.

  Carbon Dioxide Emissions
  Dr. Tonge
  To ask the Secretary of State for the Environment, Transport and the Regions what measures he will take to achieve his target for carbon dioxide reduction. [127898]

  Mr. Meacher
  The draft climate change programme that the Government published on 9 March sets out how we propose to reduce emissions of carbon dioxide and other greenhouse gases. It sets out proposals for policies and measures that will ensure the Government deliver their Kyoto target and move towards their domestic goal of reducing carbon dioxide emissions to 20 per cent. below 1990 levels by 2010. These measures include action to improve energy efficiency in business and the home; increase renewable energy and reduce emissions from the transport sector. A copy of the draft strategy is in the Library.

  London Development Agency
  Mr. Gareth R. Thomas
  To ask the Secretary of State for the Environment, Transport and the Regions what plans he has to support the London Development Agency in 2000–01. [128440]

  Mr. Hill
  Parliamentary approval for making grants to this Agency, which is to be an executive body working with the Mayor for London, is being sought in a Summer Supplementary Estimate for Housing, construction regeneration, regional policy, planning and countryside and wildlife Vote (Department of the Environment, Transport and the Regions, Class III, Vote 1). Pending that approval, urgent expenditure estimated at £7 million will be met by repayable advances from the Contingencies Fund.

  The Agency has the same statutory purposes as the regional Development Agencies in the rest of England. The status of the Agency is described in the Department of the Environment, Transport and the Regions' Annual Report 2000. Financial provision for predecessor bodies was made in the Main Estimates 2000–01, so this

  507W
  announcement will not add to the total of public expenditure. The Ambit of the Supplementary Estimate will, however, clearly identify the Agency.

  Roads
  Mr. Ivan Lewis
  To ask the Secretary of State for the Environment, Transport and the Regions what progress has been made on the M60 junction 12–18 study. [128481]

  Mr. Hill
  Phase 1 is complete and it will now be taken forward as a Multi-Modal Study. I expect work to begin this summer with completion in summer 2001.

  Mr. Alasdair Morgan
  To ask the Secretary of State for the Environment, Transport and the Regions how much was spent on the A55 in each of the last 10 years on(a) construction work and (b)maintenance. [124726]

  Mr. Paul Murphy
  I have been asked to reply.

  During the 10 years up to 1 July 1999, the approximate investments into the A55 in Wales was (a) £247 million on construction and (b) £36 million on maintenance. The figures for maintenance of the A55 in Wales are not held in a suitable form to be broken down annually without incurring disproportionate cost.

  Annual construction costs for the A55 in Wales for the 10 years leading up to 1 July 1999 were:

  £

  Year

  Costs

  1990

  72,031,304.98

  1991

  58,039,274.90

  1992

  38,265,737.02

  1993

  50,778,935.95

  1994

  13,380,375.87

  1995

  4,729,880.48

  1996

  1,400,083.32

  1997

  3,966,241.82

  1998

  4,224,182.77

  1999

  115,916.18

  Total

  246,931,933.29

  For that part of the A55 in England, the Highways Agency only hold information for the last two years (1998–99 and 1999–2000), when expenditure was:

  £

  1998–99

  1999–2000

  Construction

  219,500

  120,000

  Maintenance

  67,500

  1,032,500

  All functions with regards to trunk roads and motorways in Wales were transferred to the National Assembly for Wales on 1 July 1999.

HEALTH

  Meat Hygiene Sercice
  Mr. Paterson
  To ask the Secretary of State for Health when, and for what reason, the St. David"s Practice was 508W
  awarded the Mead Webber contract by the Meat Hygiene Service; and how many other vets or vet practices were invited to bid for that contract. [122049]

  Ms Stuart
  [holding answer 15 May 2000]: I am advised by the Food Standards Agency that a tender valuation panel met on 16 March 2000 to consider tenders submitted for the provision of official veterinary surgeon services to the plant operated by Mead Webber Limited. All tenders were assessed against a range of pre-determined criteria including quality and price.

  The panel awarded the contract to the St. David's Farm and Equine Veterinary Practice on the basis that it provided overall best value when evaluated against these criteria.

  Nine other veterinary practices or veterinary surgeons were invited to tender for this particular contract.

  Public Health (West Midlands)
  Mr. Jim Cunningham
  To ask the Secretary of State for Health what assessment he has made of the priority given to public health and healthy living programmes in the plans of primary care groups and NHS trusts in(a) Coventry and (b) the West Midlands region. [125681]

  Yvette Cooper
  [holding answer 12 June 2000]: Health development groups working across agencies and organisations have been set in motion to develop the health improvement programme (HImP) in Coventry. I understand that primary care groups have had a key leadership and membership role in these groups. Each of the three PCGs in Coventry has identified its local priorities based on an assessment of health needs of its populations and aligned funding of its Primary Care Investment plans with the health improvement plans.

  Regeneration in Coventry will be further supported through the development of a healthy living centre (HLC), subject to the success of the bid which was submitted at the end of May. HLCs are funded through the New Opportunities Fund (NOF) and are aimed at mobilising community activity in improving health and reducing inequalities. The HLC bid arose from extensive partnership working and more than 300 information packs were distributed to voluntary, community and statutory groups across Coventry. Coventry's bid is designed to complement other initiatives such as the HImP and the community plan and will focus on young people, their families and carers.

  HImPs across the West Midlands include an assessment of the health needs of local populations. Priorities are determined locally and the funding of Primary Care Group investment plans is aligned with HImP priorities.

  Primary care groups and National Health Service trusts have huge potential to improve people's health and prevent illness, and the West Midlands Regional Office will continue to support that developing role.

  Children's Homes
  Dr, Cable
  To ask the Secretary of State for Health how many children have died while in children's homes in each decade since 1970. [126198]
  509W
  Mr. Hutton
  The estimated number of children who died while being looked after by local authorities in children's homes in England during the period 1 April 1992 to 31 March 1999 was 70. Over the same period an estimated 58,000 looked after children spent at least some time in a children's home.

  The Department holds no information about looked after children's deaths by type of placement before this date.

  Asthma
  Mr. Jim Cunningham
  To ask the Secretary of State for Health what public information has been made available in the last three years, and where, by his Department on the relationship between asthma and environmental conditions; how much has been spent on providing such information; and what other agencies have been involved. [126103]

  Yvette Cooper
  [holding answer 19 June 2000]: In January 1998, the Department published an information pack, "Air Pollution and Health". It contains leaflets, contacts and statements on the relationship between asthma and air pollution from agencies such as the National Asthma Campaign, the Lung and Asthma Information Agency as well as the Department's Committee on the Medical Effects of Air Pollutants. Copies have been placed in the Library. The total design and printing costs of the pack were £23,500.

  The Department offers health advice to other Government Departments from time to time on health aspects of their policies, in particular to the Department of the Environment, Transport and the Regions (DETR) on health and environmental issues. A relevant example here is the production of a DETR leaflet "Air Pollution—what it means for your health", published in July 1998. This was designed as a guide to the Air Pollution Information Service which DETR Ministers relaunched in October 1997. The service is available by freephone, Ceefax, Teletext and via the internet. The leaflets and an accompanying poster were distributed in general practitioners' surgeries, asthma and heart clinics, Citizen's Advice Bureaux and libraries. Copies are also now included as part of the Department's "Air Pollution and Health" pack.

  The design and printing costs of the leaflets and posters were £25,142.

  Public Health Report
  Mr. Hammond
  To ask the Secretary of State for Health what reasons underlay his decision to discontinue the annual published report by the Chief Medical Officer on the state of the public health. [126665]

  Yvette Cooper
  The last Chief Medical Officer's report was published in August 1998 by Sir Kenneth Calman shortly before he left office. The present CMO came into post in late September 1998. He has taken stock of the publications issued by the Chief Medical Officer and introduced a number of changes. He is currently exploring the opportunities for greater use of web-based publishing methods.
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  After listening to a wide range of views he also intends to introduce changes to the format of his annual report. Although the previous format served its purpose well in the past, it is very detailed and it is not always clear in what areas action is being called for. The practice of the CMO's annual report containing descriptions of a wide range of government policies which are contained in other documents added to the detailed nature of the reports.

  It is the intention of the CMO to produce the new format of the report in the autumn of 2000. It will be shorter, with a clear focus on areas for action and in a more accessible form.

  Emergency Contraception
  Mr. Jim Cunningham
  To ask the Secretary of State for Health if he will make a statement about proposals to make emergency contraception available over the counter without prescription from dispensing chemists. [126112]

  Yvette Cooper
  [holding answer 20 June 2000]: The Medicines Control Agency is presently consulting on an application to reclassify levonorgestrel 0.75 milligrammes for emergency contraception from prescription only to pharmacy availability for women aged 16 years and over. This follows independent expert advice from the Committee on Safety of Medicines. The consultation period ends on 29 June 2000. The responses will then be considered by the Medicines Commission and their recommendations presented to Ministers for a decision.

  Dr. Tonge
  To ask the Secretary of State for Health what progress has been made with pilot schemes for the prescription of emergency contraceptives by pharmacists; and when emergency contraception will be more widely available. [126997]

  Yvette Cooper
  [holding answer 21 June 2000]: There are currently two pilot schemes run by health action zones (HAZs) in Manchester, Salford and Trafford (MST) and Lambeth, Southwark and Lewisham (LSL) where emergency contraception is supplied by pharmacists, under a patient group direction. Both pilots form part of the HAZ's overall strategy to reduce the rate of unintended pregnancies locally. Both pilots are to be fully evaluated and the results will be published.

  The Medicines Control Agency is presently consulting on an application to reclassify levonorgestrel 0.75 milligrammes for emergency contraception from prescription only to pharmacy availability for women aged 16 years and over. The consultation period ends on 29 June 2000. The responses will then be considered by the Medicines Commission and their recommendations presented to Ministers for a decision.

  In addition the Integrated Sexual Health and HIV Strategy is looking at improving access to services including emergency contraception products.

  National Poisons Information Service
  Mr. Tyler
  To ask the Secretary of State for Health (1) for what reason the National Poisons Information Service has not submitted its annual reports, due in July 1999 and March 2000, to his Department; and what steps he has taken to ensure that the contractual commitments of the NPIS have been delivered; [127022]
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  (2)if he will list the members of the National Poisons Information Service Board; and how details of their meeting schedule, agendas and minutes can be obtained; [127020]

  (3)what were the terms of the contracts between his Department and the National Poisons Information Service between 1995 and the current year. [127023]

  Yvette Cooper
  [holding answer 20 June 2000]: The National Poisons Information Service (NPIS) provides a service to health care professionals. It consists of six poison information centres situated at Belfast, Birmingham, Cardiff, Edinburgh, London and Newcastle, and the Tablet and Capsule Identification System (TICTAC) at St. George's. The UK Departments of Health, (in Wales the Specialist Health Services Commission on behalf of health authorities), commission the NPIS Centres to provide information and, on request, clinical advice to health care staff on the diagnosis, treatment and management of patients who have, or are suspected to have, been poisoned. The service is available 24 hours per day, 365 days per year.

  The NPIS Board was set up to advise the UK Health Departments on matters such as policy and the strategic direction of the service, and to scrutinise its work. The Board's membership consists of representatives from the four UK Health Departments who have executive powers and nine non-executive members representing health professionals. The Board aims to meet quarterly (providing there is sufficient business to warrant a meeting). It is an internal management committee and as such its agendas and minutes are not published.

  Formal agreements have existed between the Secretary of State for Health and providers of poisons information services over the period 1995 to 1999. The exact terms of these agreements will have varied between each year and between each NPIS Centre. Broadly, such agreements will have set out details of the levels and quality of service to be provided as well as financial arrangements.

  For the calendar year 1998, NPIS Centres were required to compile a report to the Department of Health to comply with the provisions of EC Resolution 90/C 329–03. All Centres met with this requirement. Under the terms of agreements with the Secretary of State for Health for the financial year 1999–2000, the three English NPIS Centres were required to submit information for management purposes. To date, one of the Centres has submitted a written report for the year 1999–2000 and the two other Centres have been requested to provide written reports by the end of June. These reports are for internal use only and therefore are not published.

  Mr. Tyler
  To ask the Secretary of State for Health since 1990, what work on pesticides has been carried out by the Medical Toxicology Unit (Guy's and St. Thomas' Hospital Trust) and the NPIS (London) under contract to agrochemical companies; what equipment, facilities and staff funded by his Department have been used for this purpose; what agreements with his Department have been made to cover this activity; if he will publish details of those contracts; and if he will make a statement. [127021]

  Yvette Cooper
  [holding answer 20 June 2000]: The laboratory of the Medical Toxicology Unit at Guy's and St. Thomas' National Health Service Hospital Trust has
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  never carried out any work under contract on pesticides. Any work in relation to pesticides has been part of the trust's NHS function in providing services for diagnosing poisoning.

  Funding by the United Kingdom Departments of Health for National Poison Information Service services covers only the inquiry services, contribution to the maintenance and development of a poisons database (TOXBASE), and outreach to, and training of, health professionals in the use of the service. This funding is not provided for the purposes of other associated activities at the Medical Toxicology Unit (Guy's and St. Thomas' Hospital NHS Trust) or at any other of the Centres.

  Hospital Beds
  Mr. Harvey
  To ask the Secretary of State for Health how many hospital beds were available in(a) Great Britain and (b) each NHS trust in (i) 1979, (ii) 1990 and (iii) each year since 1992 for which figures are available. [126921]

  Mr. Denham
  [holding answer 21 June 2000]: Copies of the information available have been placed in the Library. This relates to all types of beds and is for England only. Hospital beds in Northern Ireland, Scotland and Wales are a matter for the devolved administrations. The information is subject to the following caveats:

  Information on the average daily number of beds is now collected annually, on a financial year basis, from National Health Service providers. Prior to 1987–88 information was collected on a calendar year basis.

  Figures for 1989–90 were collected at district health authority level.

  From 1991–92 to 1994–95 NHS beds were provided by a mix of NHS trusts and directly managed units. The information in the tables is split into beds provided by NHS trusts and beds provided by directly managed units. From 1995–96 all beds were provided by NHS trusts.

  Such information is published annually in 'Bed Availability and Occupancy, England', copies of which are in the Library.

  Spiritual Healers
  Mr. Tredinnick
  To ask the Secretary of State for Health what discussions he has had with the Home Secretary about the Charity Commission's approach to the proposed registration of the National Federation of Spiritual Healers Charitable Trust Ltd. as a charity; and if he will make a statement. [126473]

  Yvette Cooper
  [holding answer 22 June 2000]: None. This is a matter for the Charity Commission, which is answerable to the High Court for its legal decisions and its interpretation of charity law.

  Eye Tests
  Mr. Hurst
  To ask the Secretary of State for Health how many free eye tests have been undertaken for pensioners under the current scheme; and what is the cost of the scheme to date. [127587]

  Mr. Denham
  We estimate that 2.5 million additional people aged 60 or over received National Health Service sight tests in the financial year from April 1999 and that the cost of our decision to restore eligibility for free tests to this population group is about £40 million per annum.

  National Plan
  Mr. Hesford
  To ask the Secretary of State for Health what progress he has made on compiling the National Plan; and if he will make a statement. [127650]

  Mr. Denham
  We have now received working papers from each of the modernisation action teams; reports on the consultation with National Health Service staff from each of the NHS Executive regional offices; responses from around 50 national and local organisations; and over 219,000 responses from staff and members of the public. We are now in the process of synthesising the material and will publish the National Plan next month.

  MRSA (Greater London)
  Mr. Love
  To ask the Secretary of State for Health how many outbreaks of MRSA there have been in each of the last five years for which figures are available in(a) Greater London and (b) Enfield and Haringey Health Authority; how many wards were closed as a result and what the average length of closure was; and if he will make a statement. [127841]

  Mr. Denham
  The Public Health Laboratory Service (PHLS) compiles aggregate data on numbers of incidents of MRSA (three or more patients infected or colonised by the same strain of MRSA in a month) that are reported voluntary by NHS Trusts.

  Data are available by health service region. The health regions that include Greater London have changed twice in the past five years. Data on MRSA incidents in the Thames regions (1995–98) and London and South East regions (1999) are summarised in the table.

  MRSA incidents, South East England 1995–99

  Region

  1995

  1996

  1997

  1998

  1999

  North East Thames

  266

  245

  1158

  —

  —

  North West Thames

  300

  294

  1141

  —

  —

  South East Thames

  248

  235

  1120

  —

  —

  South West Thames

  129

  186

  193

  —

  —

  North Thames

  —

  —

  2245

  289

  —

  South Thames

  —

  —

  2172

  220

  —

  London

  —

  —

  —

  —

  290

  South-East

  —

  —

  —

  —

  170

  Total

  943

  960

  929

  509

  460

  1 Data from January to June 1997

  2 Data from July to December 1997

  The PHLS does not collect data for individual health authorities.

  Health Action Zones
  Mr. Love
  To ask the Secretary of State for Health what plans the Government have to announce a further bidding round for health action zones; and if he will make a statement. [127840]

  Mr. Denham
  There are no plans for a further bidding round for health action zones (HAZs). We are however committed to spreading learning and good practice from the existing 26 HAZs into other areas and seeing the services and approaches being developed by HAZs integrated into mainstream activity throughout the country. An example of this is the new premises flexibilities that were developed with HAZs and that I announced to all health authorities on 20 January.

  Coronary Heart Disease
  Mr. David Taylor
  To ask the Secretary of State for Health if he will make a statement on the implementation of the National Service Framework for Coronary Heart Disease. [127430]

  Yvette Cooper
  (holding answer 23 June 2000]: The National Service Framework (NSF) which sets national standards for improved prevention, diagnosis and treatment of coronary heart disease (CHD) was published on 6 March.

  Action is progressing on a number of fronts:

  National Priorities Guidance (NPG) identifies developing and implementing local prevention policies on CHD and stroke by March 2001, increasing the number of coronary revascularisations (CABG/PTCA) by 3,000 by April 2002 and achieving the NHS milestones for April 2001 as priorities for the National Health Service.

  We have appointed Dr. Roger Boyle as National Director for Heart Disease. Dr. Boyle's first priority is to work with NHS and Regional Offices on drawing up plans for guidance on the immediate priorities including plans for expenditure of £50 million (announced last October) to increase the numbers of heart operations.

  Plans are also being worked up for spending the further £50 million (announced on 6 March) for establishing rapid access chest pain clinics, speeding up ambulance response times and purchasing defibrillators and other equipment.

  £3 million of the £50 million will also be used to reduce waiting times for treatment by developing projects to test out better and more streamlined ways of delivering services, the CHD partnership programme. Plans to take this forward are in hand.

  Health authorities and their partner organisations are establishing local implementation teams to draw up comprehensive local delivery plans, to be completed and agreed by October 2000

  We are in the process of setting up the National Coronary Heart Disease Implementation Group which will oversee national progress on implementation.

  Surgical Services
  Mr. Truswell
  To ask the Secretary of State for Health if he will make a statement on the effect of clinical governance on the continuing provision of in-patient surgical services at(a) smaller hospitals and (b) in general. [127797]

  Mr. Denham
  Clinical governance is central to our plans to provide a health service that continually improves the overall standard of clinical care it delivers, reduces unacceptable variations in treatment outcomes, and ensures that clinical decision making is supported by evidence of effectiveness. It represents a systematic approach to clinical quality assurance and improvement, but does not dictate how services should be managed or delivered. This is the responsibility of local commissioners who must ensure that high quality surgical services are provided safely, taking into account local circumstances such as geography and the need for remote smaller services to be linked into wider clinical networks.

  Acute Services
  Mr. Cox
  To ask the Secretary of State for Health how many acute hospital beds are available at NHS hospitals within the Greater London Authority area. [127847]

  Mr. Denham
  I refer my hon. Friend to my answer of 17 May 2000,Official Report, column 128W.

  The average daily number of available acute hospital care beds in the London region in the financial year 1998–99 was 17,022.

  Internet
  Dr. Gibson
  To ask the Secretary of State for Health what action he has taken to provide protection to patients who utilise the Internet for health information services and products. [127883]

  Ms Stuart
  [holding answer 27 June 2000]: The success of the Internet has been partly due to the ease with which people can access and create information. While it is not possible to restrict what patients see on the Internet, we recognise the need to signpost information sources, and to give easy access to relevant quality information that the public and patients can rely on, and which is presented in a clear and intelligible way.

  A number of information initiatives are being put in place to improve the quality and range of information available about health and health services:

  The National Health Service Executive has set up the Centre for Health Information Quality (CHiQ). The role of CHiQ is to work with the producers of information for the patients and the public to improve its quality, accessibility and evidence base. The CHiQ work uses the DISCERN tool for evaluating health literature. DISCERN was developed by the UK academic sector in collaboration with healthcare professionals and is funded by the NHS Executive.

  NHS Direct Online (www.nhsdirect.nhs.uk) is a highly successful gateway to health information on the Internet attracting 25,000 users a week and complementing the NHS Direct telephone advice service. NHS Direct Online is managed by the CHiQ on behalf of the NHS Executive.

  nhs.uk will provide a strongly branded gateway (www.nhs.uk) to NHS websites and licensed or accredited websites and services. Close working relationships with the Department of Health, NHS Executive, other NHS Information Authority programmes and the NHS are in place.

  The National Electronic Library for Health (NeLH) will provide a common point of public access to a wide range of health knowledge bases. The NeLH will emphasise the need for all clinical practitioners to critically evaluate sources.

  There is currently no formal process of NHS accreditation of the vast amount of clinical and health related reference material already available on the Internet. Feedback from the consultation exercise on the NHS National Plan has indicated that there is a need to identify NHS approved quality resources by means of a NHS "kitemark". The work being undertaken by CHiQ and the NHS Information Authority to develop NHS Direct Online and the National Electronic Library for Health will help to identify practical options for achieving this.

  Ultimately however the responsibility rests on individual clinicians, patients and members of the public to make their own judgments about the validity of the material they access.

  NHS Management Spending
  Mr. Harvey
  To ask the Secretary of State for Health how much was spent on NHS management and administration in each region in England in the last year for which figures are available; and if he will make a statement. [127689]

  Mr. Denham
  [holding answer 27 June 2000]: Management costs expenditure is shown in the tables.

  £ million

  Health authority/region

  1997–98 Outturn

  1998–99 Plan1

  1999–2000 Plan2

  Northern and Yorkshire

  54.0

  53.7

  70.1

  Trent

  44.8

  43.9

  56.3

  Eastern

  42.3

  41.0

  52.8

  London

  77.6

  73.5

  92.8

  South East

  70.6

  68.2

  87.2

  South West

  37.7

  38.2

  49.7

  West Midlands

  45.9

  44.3

  57.2

  North West

  59.3

  56.4

  74.1

  England

  452.2

  419.2

  540.2

  11998–99 outturn figures will be published shortly.

  2Comprises health authority cost baseline of £418 million and £122 million to support primary care groups redistributed from the former general practice fundholder management allowance.

  £ million

  NHS trust/region1

  1997–98 outturn

  Northern and Yorkshire

  164.6

  Trent

  122.0

  Anglia and Oxford

  120.2

  North Thames

  235.0

  South Thames

  206.5

  South West

  147.8

  West Midlands

  135.4

  North West

  164.3

  England

  1,295.7

  1At 1 April 1998 regions were re-configured. These figures are expressed in the old configuration.

  £ million

  NHS trust/region

  1998–99 plan1

  1999–2000 plan

  Northern and Yorkshire

  169.0

  164.5

  Trent

  126.4

  126.4

  Eastern

  120.5

  119.2

  London

  282.7

  281.1

  South East

  204.0

  201.6

  South West

  111.3

  111.2

  West Midlands

  134.1

  133.6

  North West

  168.1

  168.3

  England

  1,316.1

  1,305.9

  11998–99 outturn figures will be published shortly

  Therapeutic Cloning
  Mr. Syms
  To ask the Secretary of State for Health when he expects the Donaldson inquiry on therapeutic cloning to report. [127987]

  Yvette Cooper
  [holding answer 27 June 2000]: The Chief Medical Officer's expert group on therapeutic cloning has completed its work on the potential benefits,

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  risks and the ethical issues raised by developments in stem cell research and cell nuclear replacement. We are now considering the report's recommendations.

  Hospital Waiting Times
  Mr. Matthew Taylor
  To ask the Secretary of State for Health what estimate he has made of the cost of reducing(a) inpatient and (b) outpatient waiting times to (i) six months or less and (ii) three months or less; and if he will make a statement. [127499]

  Mr. Denham
  [holding answer 27 June 2000]: We are determined to reduce waiting lists and times for all patients. As part of the National Plan for the National Health Service, the Patient Care: Speed of Access Modernisation Action Team is looking at improving patient's access to NHS services.

  Respite Care
  Mr. Corbyn
  To ask the Secretary of State for Health what percentage of the population is entitled to respite care in each local social services authority. [127894]

  Mr. Hutton
  Respite care is provided by or on behalf of local authority social services departments. The supply of short-term breaks is not entitlement-based but is governed by the assessment of individuals' needs.

  Terminally Ill Children (Southend)
  Sir Teddy Taylor
  To ask the Secretary of State for Health if he will make a statement on the investigations into the allegations relating to the treatment of terminally-ill children within the Southend Community Services Trust. [128060]

  Mr. Denham
  We are aware of the police investigation which is clearly a matter of major concern. We understand that the South Essex Mental Health and Community Care NHS Trust is co-operating fully with Essex Police. As the matter is at present under police investigation it would be inappropriate to comment further.

CULTURE, MEDIA AND SPORT

  Canadian Memorial Fountain, Green Park
  Mr. Paul Marsden
  To ask the Secretary of State for Culture, Media and Sport when the Canadian Memorial Fountain in Green Park will be switched back on; and if he will make a statement. [126589]

  Mr. Chris Smith
  [holding answer 19 June 2000]: Responsibility for the subject of the fountain has been delegated to the Royal Parks Agency. As its Chief Executive, William Weston, has not yet taken up his appointment, I have asked the Agency's Head of Policy, Viviane Robertson, to reply on his behalf.

  Letter from Viviane Robertson to Mr. Paul Marsden, dated 28 June:
  The new Chief Executive has not yet taken up his appointment and I have been asked by the Secretary of State for Culture, Media and Sport to answer your Parliamentary Question about the Canada Memorial Fountain, because Green Park is the responsibility of the Agency.
  518W
  The Canada Memorial is maintained by the Canada Memorial Foundation, not by the Agency, although we let them know whenever our contractors or park management staff report that it is not working. I understand that the water was flowing intermittently at the weekend and the Foundation have been informed of this.

  Buildings at Risk
  Mr. Peter Ainsworth
  To ask the Secretary of State for Culture, Media and Sport what action he proposes in response to the publication by English Heritage of the Register of Buildings at Risk 2000; and if he will make a statement. [127306]

  Mr. Chris Smith
  [holding answer 22 June 2000]: I very much support the Buildings at Risk initiative which is a valuable tool in directing funding to the most important of England's historic buildings which are in urgent need of conservation. Removal of buildings at risk from the register is a key target in the Funding Agreement between my Department and English Heritage (EH), although the exact allocation of resources to this activity is a matter for EH' s Commissioners. It is also important that owners of these buildings play their part in funding conservation works.

TRADE AND INDUSTRY

  Opinion Research
  Mr. Don Foster
  To ask the Secretary of State for Trade and Industry, pursuant to his answer of 12 June 2000,Official Report, column 466W, on opinion research, what information is held centrally about the results of his Department's market and opinion research. [127644]

  Dr. Howells
  There is no central point where all the results of the Department's market and opinion research is held.

  National Weights and Measures Laboratory
  Dr. Cable
  To ask the Secretary of State for Trade and Industry what plans he has for the National Weights and Measures Laboratory in Teddington; and if he will make a statement. [127863]

  Dr. Howells
  The National Weights and Measures Laboratory is an Executive Agency of my Department. The status of Executive Agencies is regularly reviewed. A review of the status of the National Weights and Measures Laboratory has just been undertaken. The reviewer consulted widely. The staff and the customers of the Laboratory were among those consulted. The reviewer's recommendations have only very recently been sent to Ministers. No decisions have been taken. A further statement will be made after Ministers have considered the reviewer's report.

  Small Business
  Mr. Breed
  To ask the Secretary of State for Trade and Industry what percentage of the work carried out by the Small Business Unit is focused on(a) urban and (b) rural areas. [128053]

  Ms Hewitt
  The support and advice being provided by the Small Business Service, both on a national basis and through the new network of Business Links, will be
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  available to all small businesses and those considering starting up in business. The new Business Links will be expected to tailor services to the particular needs of their areas; the Small Business Service will be working to ensure, during the planning stages, that the services provided reflect the needs of their local business communities.

  Post Offices
  Mr. Breed
  To ask the Secretary of State for Trade and Industry when he will publish the report by the Performance and Innovation Unit on rural post offices. [128054]

  Mr. Alan Johnson
  I refer the hon. Member to the statement made by my right hon. Friend earlier today,Official Report, columns 907–09.

PRIME MINISTER

  Iraq
  Mr. Dalyell
  To ask the Prime Minister, pursuant to the answers of the Foreign Secretary of 8 May 2000,Official Report, column 258W, on sanctions, what the value is of the contracts in respect of Iraq checked to date. [127221]

  The Prime Minister
  The Oil for Food programme began on 10 December 1996. As at 31 May 2000, 12,675 contracts with a total value of $15.6 billion had been received under the programme. As indicated previously, the UK checks all contracts to ensure that the goods will be used for their stated purpose.

HOME DEPARTMENT

  National Infrastructure Security
  Mr. Key
  To ask the Secretary of State for the Home Department if he will list the responsibilities of the National Infrastructure Security Co-ordination Centre; and if he will make a statement. [126287]

  Mr. Straw
  The responsibilities of the National Infrastructure Security Co-ordination Centre (NISCC) are to co-ordinate and develop existing work on protecting the Critical National Infrastructure within Government departments and the private sector from the threat posed by Electronic Attack. This will include developing arrangements to monitor and increase awareness of the threat, to defend against it and to respond to incidents. The monitoring and advice aspects of this work are achieved through Unified Incident Reporting and Alert Scheme (UNIRAS), which is operated by the NISCC.

  Mr. Key
  To ask the Secretary of State for the Home Department what assessment his Department has made of the vulnerabilities of the United Kingdom's critical infrastructure. [126288]

  Mr. Straw
  At this time there is no evidence to suggest a significant risk from Electronic Attack to the United Kingdom's Critical National Infrastructure. The National Infrastructure Security Co-ordination Centre (NISCC) is, however, working in partnership with organisations which own systems that are critical to the national infrastructure,520W
  in order to obtain assurances that their systems are appropriately safeguarded against the threat posed by Electronic Attack.

  Animal Experiments
  Mr. Baker
  To ask the Secretary of State for the Home Department (1) how many baboons and cynomolgus monkeys are held within United Kingdom laboratories awaiting xenotransplantation procedures; and if he will make a statement; [125262]

  (2) how many baboons and cynomolgus monkeys intended for xenotransplantation research have been killed without any xenotransplantation procedures being completed on them in each of the last five years; and if he will make a statement; [25263]

  (3) what was the (a) longest and (b) average recorded journey time for non-human primates imported into the United Kingdom for research purposes during 1999 from (i) China, (ii) Mauritius, (iii) Indonesia, (iv) the Philippines and (v) Israel; and if he will make a statement; [125266]

  (4) how many cynomolgus monkeys were imported into the United Kingdom for the purpose of xenotransplantation research, broken down by (a) where the monkeys were imported from, (b) how many died during transport, (c) the date of deaths, (d) the causes of death and (e) action taken by his Department as a result, in (i) 1995, (ii) 1996, (iii) 1997, (iv) 1998, (v) 1999 and (vi) 2000;[125259]

  (5) how many cynomolgus macaques and baboons were used in xenotransplantation research in (a) 1995, (b) 1996, (c) 1997, (d) 1998, (e) 1999 and (f) 2000; and if he will make a statement; [125267]

  (6) how many baboons were imported into the United Kingdom for the purpose of xenotransplantation research; and (a) where they were imported from, (b) whether they were wild-caught, (c) how many died during transport, (d) the date of deaths, (e) what were the causes of death and (f) what action was taken by his Department as a result, in (i) 1995, (ii) 1996, (iii) 1997, (iv) 1998, (v) 1999 and (vi) 2000; [125260]

  (7) when current project licences to conduct pig primate xenotransplantation research will expire; and whether he is considering future pig-to-primate xenotransplantation licences. [125261]

  Mr. Mike O'Brien
  [holding answer 9 June 2000]: The Animals (Scientific Procedures) Act 1986 requires that non-human primates are only used in scientific procedures if no other species is suitable. In deciding whether to grant a licence for any regulated procedure, the 1986 Act requires that the likely benefits of the programme be weighed against the likely adverse effects on the animals concerned (the cost/benefit assessment) and that there are no alternatives which either replace animal use entirely, reduce the number of animals needed or refine the procedures to minimise suffering. We must also be satisfied that the procedures are likely to achieve the stated objectives.
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  In addition to regulatory testing to help ensure the safety of medicines, non-human primates are also used for other important areas of fundamental research aimed primarily at better understanding the causes of disease in man and developing potential new treatments.

  They contribute, for example, to programmes of work relating to Parkinson's disease, visual impairment, stroke, diabetes, disorders of reproduction, xenotransplantation and vaccine development.

  There are no cynomolgus macaques or baboons known to be awaiting xenotransplantation procedures at the present time in United Kingdom designated establishments.

  According to our records, journey times for non-human primates imported into the United Kingdom for research purposes in 1999 were:

  Number-imports

  Longest (hours)

  Average (hours)

  China

  5

  46

  43

  Mauritius

  21

  34

  29

  Indonesia

  0

  —

  —

  Philippines

  1

  34

  34

  Israel

  9

  16

  Less than 10

  In accordance with measures introduced in 1996, the Home Office requires only an estimated total journey time to be provided prior to each acquisition and that, after each acquisition, confirmation be provided that the importation was in accordance with what had been authorised. There has been no obligation to provide precise journey times. Data have also been drawn from copies of journey details required by and supplied to the Ministry of Agriculture, Fisheries and Food, who would be the more appropriate Department to provide such data in future.

  The Welfare of Animals (Transport) Order 1997, which is administered by the Ministry of Agriculture, Fisheries and Food, governs the transportation of live animals, including primates. It requires that the animals must be fit to travel, carried in a way that does not cause injury or unnecessary suffering and be accompanied by someone competent to look after their welfare. Import licences specify the intended use and the Ministry of Agriculture, Fisheries and Food receives details of deaths arising.

  I refer the hon. Member to the reply given to my hon. Friend the Member for Leyton and Wanstead (Mr. Cohen) by the then Parliamentary Under-Secretary of State for the Home Department, my hon. Friend the Member for Knowsley, North and Sefton, East (Mr. Howarth) on 8 June 1999, Official Report, columns 262–63W, which provided details of deaths and serious injury in primates arriving in the United Kingdom for use in regulated procedures. I will, however, repeat the relevant parts of this information for ease of reference.

  Twelve wild-caught baboons were imported from Kenya in 1996 for the purpose of xenotransplantation research, the earliest year for which we hold such records. A further 28 were imported in May 1999. There have been no subsequent importations of baboons for this purpose. No deaths or serious injuries have been reported in baboons during transportation.

  In 1995, one cynomolgus macaque was found to be dead on arrival in the United Kingdom from Mauritius. The cause of death was believed to be enteritis.
  522W
  In 1996, one cynomolgus macaque was found to be dead on arrival in the United Kingdom from Mauritius. The cause of death was believed to be shigellosis.

  In 1997, one cynomolgus macaque was found to be traumatised on arrival in the United Kingdom from Mauritius, possibly as a result of being pair-housed during transport. It was euthanased and all primates are now individually housed during transport. Another cynomolgus macaque was found to be dead on arrival in the United Kingdom from the Philippines. The cause of death was probably a trauma to the head.

  In 1998, three cynomolgus macaques were found to be dead on arrival in Paris from the Philippines. The causes of death were not ascertained, but it is believed that they were probably due to a combination of factors:
  the animals concerned were larger than normal;
  although International Air Transport Association minimum dimensions were not breached, the containers were not large enough to allow these particular animals to stand up and turn around freely; and
  all the dead animals had been in central compartments, which were less well ventilated.

  The containers have been enlarged and redesigned to rectify these problems. Another cynomolgus macaque was found to be dead on arrival in the United Kingdom from Israel. There was no obvious cause of death.

  It is not possible to give an accurate figure for how many cynomolgus macaques intended for xenotransplantation have been imported and we cannot, therefore, confirm whether all of the animals listed above were to be used for this purpose.

  Airlines refusing to fly animals directly to the United Kingdom as a result of harassment from animal rights activists has led to longer journey times. This may have contributed to deaths associated with transportation in some instances.

  Eighty wild-caught baboons were used in xenotransplantation research in 1995, 29 in 1996 and 16 in 1997, three in 1998 and none subsequently.

  Thirty-one cynomolgus macaques were used in xenotransplantation research in 1996, 67 in 1997, 78 in 1998, 49 in 1999, and five in 2000.

  It is not possible to give an accurate figure for how many baboons and cynomolgus monkeys intended for xenotransplantation research have been killed without any xenotransplantation procedures being completed on them. The intended purpose is known to the Home Office in the case of animals acquired directly from overseas breeding centres by project licence holders. However, if animals are obtained from a designated supplier within the United Kingdom or from stock already held by the establishment, there is no requirement for reference to be made to the Home Office. The estimated number of animals expected to be used is provided in each project licence application but this does not necessarily mean that the animals are acquired in advance. We do not hold records of individual animals which are subsequently not used for the intended purpose.
  523W
  There are currently two project licences authorising pig to primate xenotransplantation procedures, one expiring in 2003 and the other in 2004. There are no new applications under consideration at this stage. Any future applications received will be considered on their merits.

  Police Pensions
  Dr. Cable
  To ask the Secretary of State for the Home Department what is his estimate for planning purposes of net pensions fund obligations, pensions less contributions, for(a) the Metropolitan police and (b) all UK police forces in (i) 2000–01, (ii) 2001–02, (iii) 2005–06 and (iv) 2010–11; and how these obligations will be financed. [127330]

  Mr. Charles Clarke
  The available figures for England and Wales, provided by the Police Service Expenditure Forecasting Group, are:

  £ million

  Metropolitan police

  England and Wales1

  2000–01

  251

  1,054

  2001–02

  273

  1,143

  1The England and Wales figure is inclusive of the Metropolitan police

  Under the Central Local Partnership the Home Office works closely with the Forecasting Group to assess future resource demands for the following three years. The Group does not prepare longer range projections. Its assessments of future funding pressures, including pensions, are taken into account by the Government in the Spending Review process.

  The Police Funding Formula takes account of police pensions expenditure. 14.5 per cent. of funding is currently allocated through a component for pensions.

  The provision of revenue funding for the police forces in Scotland and Wales is the responsibility of the devolved administrations.

  Assaults, Alton Railway Station
  Mr. Galloway
  To ask the Secretary of State for the Home Department if he will call for a report from the Chief Constable of Hampshire on the attack on Dr. Burhan al-Chelabi and Detective Constable Stephen Longshaw on 30 April; and if he will make a statement. [127170]

  Mr. Charles Clarke
  The attack on Dr. Burhan al-Chelabi and Detective Longshaw took place at Alton Railway station in Hampshire and was investigated by the British Transport police. I understand that Dr. al-Chelabi was assaulted by Mr. Colin Smith who also subjected him to racist abuse. Detective Constable Longshaw, a serving officer with the Metropolitan Police Service, who was enjoying an outing with his family in the company of Dr. Burhan al-Chelabi and his wife, prevented Mr. Smith from attacking Dr. al-Chelabi with a sword. During the incident Mr. Smith also attacked Detective Constable Longshaw who received a cut across his nose.

  Mr. Smith was arrested by Detective Constable Longshaw and subsequently detained under the Mental Health Act 1983.

  Mike Tyson
  Ms Jenny Jones
  To ask the Secretary of State for the Home Department (1) what checks were made on personnel who have entered the UK with Mike Tyson with regard to establishing previous convictions for serious offences; [127398]

  (2) who entered the UK accompanying Mike Tyson [127476]

  Mr. Straw
  Mike Tyson was accompanied on his flight to the United Kingdom by his manager and two trainers.

  The personnel accompanying Mike Tyson were treated in accordance with current immigration procedures. Under these, arriving passengers are not routinely questioned at ports of entry to establish whether they have criminal records. Where there is reason to believe that someone has a criminal record hitherto unknown to the Immigration Service, further examination would take place to establish whether there were grounds for refusing entry to that person.

  Transsexuals
  Dr. Harris
  To ask the Secretary of State for the Home Department what recent representation he has received about transsexual men and women being treated in law as being of the same sex as when they were born. [127645]

  Mr. Mike O'Brien
  Since 15 February 2000, we have received representations from 26 members of the public and one organisation. Several hon. Members have also written about this matter. In addition, following their meeting in January with the Interdepartmental Working Group on Transsexual People, representatives of six organisations representing the transsexual community (Gender and Sexuality Alliance, Gender Trust, Gender Identity Research and Education Society, Change, Liberty, and Press for Change) submitted further information.

  Policing Costs (Stonehenge)
  Mr. Key
  To ask the Secretary of State for the Home Department what the cost was to(a) Wiltshire Constabulary and (b) English Heritage of police operations at Stonehenge on 20 and 21 June; if (i) public order and (ii) other offences were committed; and if he will make a statement. [127710]

  Mr. Charles Clarke
  The estimated cost to the Wiltshire Constabulary of police operations at Stonehenge on 20 and 21 June was £50,000. English Heritage were not charged for police costs arising from this operation. No persons were arrested for public order offences and no offences in connection with the event at Stonehenge have been reported to police. Five people were arrested on the night of 20 June at the temporary car park on suspicion of drink driving and vehicle theft. One person was subsequently charged with a drink driving offence while the other four persons were released without charge. I should like to take this opportunity to express my appreciation of the roles played by both Wiltshire Constabulary and English Heritage in ensuring that the event passed off peacefully.

  Asylum Seekers
  Mr. Love
  To ask the Secretary of State for the Home Department how many(a) Turkish and (b) Kurdish refugees have applied for asylum in the United Kingdom in each of the last five years; how many of these applications have been granted in each of those years;

  Asylum applications1 received in the United Kingdom, excluding dependants, and initial decisions2,6 on applications, 1995 to 1999, nationals of Turkey

  Principal applicants

  1995

  1996

  1997

  1998

  19997

  Applications

  Total

  1,820

  1,495

  1,445

  2,015

  2,850

  Port

  745

  825

  890

  1,620

  2,045

  In country

  1,075

  670

  555

  390

  805

  Decisions

  Total decisions

  995

  1,405

  1,585

  1,085

  6625

  Grants of asylum

  50

  55

  65

  40

  615

  Grants of ELR

  35

  20

  25

  30

  *

  Total refusals

  910

  1,330

  1,475

  1,015

  6100

  Grants of ELR under backlog criteria3,4

  n/a

  n/a

  n/a

  n/a

  6505

  Non compliance refusals under backlog criteria3,5

  n/a

  n/a

  n/a

  n/a

  65

  Applications pending

  3,545

  4,280

  4,050

  4,870

  N/A

  1Figures rounded to nearest 5, with (*) = 1 or 2

  2Information is of Initial determination decisions, excluding the outcome of appeals or other subsequent decisions

  3Cases decided under pragmatic measures aimed at reducing the pre Asylum and Immigration Act 1996 asylum backlog.

  4May include a small number of cases where asylum has been granted.

  5May include a small number of cases where the applications has been refused on substantive grounds.

  6January to May 1999 only

  7Provisional data

  Note:

  n/a = Not applicable and N/A = Not available

  Mr. Corbyn
  To ask the Secretary of State for the Home Department how many asylum seekers were held under immigration law in(a) Campsfield, (b) Haslar, (c) Oakington and (d) Her Majesty's prisons in each of the last 12 months. [127903]

  Mrs. Roche
  The information requested, on numbers of asylum applicants held under immigration law in Campsfield House, Haslar, Oakington and Her Majesty's prisons in each of the last 12 months, is not held centrally and could be obtained only at disproportionate cost.

  The latest available information on immigration detainees relates to 30 April 2000. On that date, a total of 1,107 persons were detained in immigration detention centres and prison establishments in the United Kingdom solely under Immigration Acts powers. This figure is not recorded in such a way as to identify those who had applied for asylum at some point.

  The latest reliable snapshot of detained asylum seekers related to those asylum applicants detained in immigration detention centres, prison establishments and police cells solely under Immigration Acts powers as at 30 December 1998 for port applicants and 4 January 1999 for in-country applicants. On those dates 741 such persons were recorded. Data recording problems mean that an updated figure is not currently available.
  526W
  how many are still outstanding; and if he will make a statement. [127829]

  Mrs. Roche
  The available information is give in the table. Application for asylum are recorded on a nationality basis, therefore, Kurdish refugees are not separately identifiable within the statistics. An applicant"s ethnic origin could only be obtained by examination of individual case records.

  The most recent data available for persons detained at Oakington show that up to 18 June a total of 439 principal asylum applicants and 33 dependants of asylum seekers have been detained at varying times since it opened on 20 March 2000.

  Terminally Ill Children (Southend)
  Sir Teddy Taylor
  To ask the Secretary of State for the Home Department if he will call for a report from the Chief Constable of Essex Police on the progress of police inquiries into allegations about the treatment of terminally ill children within the Southend Community Care Trust. [128061]

  Mr. Charles Clarke
  I understand from Essex Constabulary that the investigations are at an early and extremely sensitive stage.

  Passport Agency
  Mr. Hope
  To ask the Secretary of State for the Home Department when he will publish the report on the United Kingdom Passport Agency Quinquennial Review. [128296]

  Mr. Straw
  I have today published the United Kingdom Passport Agency Quinquennial Review Report and I have placed copies in the Library.

  Immigration
  Mr. Tony Lloyd
  To ask the Secretary of State for the Home Department what progress has been made in
  527W
  the case of Mr. K. (reference K422196/2); when this case is likely to be concluded; and if he will make a statement. [127910]

  Mrs. Roche
  Mr. K.'s application for a reconsideration of his case will be reviewed shortly and he will be contacted directly once a decision is made.

INTERNATIONAL DEVELOPMENT

  Animal Welfare
  Mr. Prosser
  To ask the Secretary of State for International Development what steps she is taking to discourage developing countries from adopting industrial animal husbandry systems which have been shown by scientific research to have adverse implications for animal health and welfare; and if she will make a statement. [127849]

  Mr. Foulkes
  DFID' s involvement in the livestock sector is based on an appreciation of the diverse contribution livestock make to the livelihoods of the poor and vulnerable.

  We are supporting the international "Livestock, Environment and Development" initiative, which seeks to identify policy interventions to correct the market distortions that currently favour industrial livestock production in many developing countries.

  We are also developing a programme of support to FAO aimed at strengthening international norm-setting in the livestock sector: norms that will undoubtedly address issues of animal health and welfare.

  DFID has anticipated the impact of globalisation on animal welfare and trade in developing countries. We already have guidelines on the use of animals in development programmes, which will now be revised in the context of global shifts in livestock production and markets. Dialogue with UK and international welfare groups and other stakeholders is under way.

  Heavily Indebted Poor Countries
  Dr. Tonge
  To ask the Secretary of State for International Development what discussions she has had with other Government departments regarding relief of debt to UK companies who supply services and goods to heavily indebted poor countries as a result of tied aid. [127902]

  Mr. Foulkes
  None. Debt relief is not provided to UK companies. It is provided to governments of Heavily Indebted Poor Countries (HIPC) who are committed to eradicating poverty, to benefit the poor. The Government have agreed to provide complete relief on all debts owed to the Export Credit Guarantee Department for those countries which qualify for the HIPC initiative. Aid debts have already been cancelled.

  Uganda
  Dr. Tonge
  To ask the Secretary of State for International Development what discussions she has had with the Government of Uganda concerning the abolition of primary school fees once debt relief has taken place. [127900]
  528W
  Mr. Foulkes
  There has been no need for discussions on this particular issue as the Government of Uganda abolished primary school fees in all Government schools, with the exception of those in municipal areas, in January 1997. HIPC1 is on-going and HIPC2 has yet to be finalised; both sets of resources will be used to support the Government of Uganda's primary education programme.

  Dr. Tonge
  To ask the Secretary of State for International Development what discussions she has had with the UN concerning the suspension of debt relief to Uganda. [127899]

  Mr. Foulkes
  My right hon. Friend had no discussions with the UN concerning debt relief to Uganda. We agreed that Uganda's debt relief could not be finalised by the Paris Club of government creditors at their May meeting as planned, because of Uganda's involvement in fighting at Kisangani. We want an early and lasting resolution to the situation, and we urge all sides to implement their obligations under the Lusaka Accord. When Uganda has fulfilled the undertakings it has given on Kisangani, we will support their return to the Paris Club. Uganda is receiving interim relief from the IMF and the World Bank, and we believe this should continue.

  Montserrat
  Dr. Tonge
  To ask the Secretary of State for International Development how many Montserratians who temporarily took refuge in the UK following the volcanic eruption in Montserrat have returned home; and if she will make a statement on(a) conditions in Montserrat and (b) the aid which is provided there. [127895]

  Mr. Foulkes
  Since May 1996, about 3,000 Montserratians have come to the United Kingdom because of the volcanic activity on the island. In May 1999, DFID introduced a Return Air Fare Scheme to provide assistance to those people who, having relocated to the UK or the Caribbean region, wished to return to Montserrat and had suitable accommodation on island. During the first year, 109 applications were received from people living in the UK and, as at the 31 May 2000, 83 people had returned to Montserrat.

  Statistics are not held by Her Majesty's Government or the Government of Montserrat on the number of people returning without assistance from the Return Air Fare Scheme.

  Dr. Tonge
  To ask the Secretary of State for International Development what discussions she has had with the Government of Montserrat concerning funding for the Reporter news-sheet. [127896]

  Mr. Foulkes
  None. Officials have discussed the matter with their counterparts on island, and the Chief Minister. The Montserrat Reporter received start up capital from HMG and for several years since has received budgetary aid from DFID, paid through the Chief Minister's Office in exchange for publishing Government news. The Government of Montserrat have recently concluded in a Public Service Inquiry that these payments did not represent value for money. DFID officials have now decided to withdraw the support, which was never intended as a permanent arrangement.

SOCIAL SECURITY

  Incapacity Benefit
  Mr. Matthew Taylor
  To ask the Secretary of State for Social Security what is his estimate of the cost of(a) restoring the severe disablement allowance and (b) reversing the changes to Incapacity Benefit entitlement made since May 1997; and if he will make a statement. [127497]

  Mr. Bayley
  [holding answer 27 June 2000]: I refer the hon. Member to the written answer I gave the hon. Member for Moray (Mrs. Ewing) on 8 February 2000, Official Report, columns 129–30W.

  Housing Benefit
  Ms Buck
  To ask the Secretary of State for Social Security what assessment he has made of the impact of Housing Benefit shortfalls on the family budgets of households on Income Support/Incapacity Benefit. [127006]

  Angela Eagle
  Restrictions on the rent met by Housing Benefit can arise for a number of reasons. For example, any rent met by Housing Benefit will be net of ineligible

  Housing Benefit (HB) family recipients also in receipt of Income Support (IS) in Great BritainߞMay 1998

  Family

  Total

  Single with dependants

  Couple with no dependants

  Couple with dependants

  Total in receipt of HB and IS

  1,130,000

  816,000

  188,000

  127,000

  Total assessed under the Local Reference Rent scheme

  157,000

  129,000

  15,000

  13,000

  Total restricted under the Local Reference Rent scheme

  55,000

  45,000

  6,000

  4,000

  Average amount of restriction as a result of the Local Reference Rent scheme

  £ 5.90

  £ 6.30

  £ 4.60

  £ 3.30

  Housing Benefit (HB) family recipients also in receipt of Incapacity Benefit (IB) in Great Britain—May 1998

  Family type

  Total

  Single with dependants

  Couple with no dependants

  Couple with dependants

  Total in receipt of HB and IS

  187,000

  19,000

  110,000

  59,000

  Total assessed under the Local Reference Rent scheme

  13,000

  3,000

  6,000

  4,000

  Total restricted under the Local Reference Rent scheme

  5,000

  1,000

  3,000

  1,000

  Average amount of restriction as a result of the Local Reference Rent scheme

  £4.30

  £4.60

  £4.50

  £3.10

  Notes:

  1.Information refers to the number of benefit units.

  2.The figures are rounded to the nearest thousand and the average amounts of restriction or deduction are rounded to the nearest 10 pence.

  3.Some people claim both IS and IB. Therefore, there is some overlap in the tables above.

  4.Families are couples and benefit units with children; the tables exclude single people with no dependants.

  Source:

  Housing Benefit Management Information System, annual 1per cent. sample, taken on the second Thursday of May 1998.

  Mr. Corbyn
  To ask the Secretary of State for Social Security (1) when he expects to receive a report from his inspectorate on Housing Benefit in Islington; and if he will make a statement; [127905]

  (2) what representations he has received on the competence of IT Net to administer Housing Benefit in Islington; [127906]

  (3) what steps are being taken by his Department to ensure that Housing Benefit claimants in Islington receive an appropriate level of service. [127907]

  Angela Eagle
  The Benefit Fraud Inspectorate has recently started an inspection of the administration of 530W
  service charges. It is a basic principle of the scheme that such costs should be met from clients" other income, including Income Support.

  Restrictions may also be made under the local reference rent scheme. This scheme is designed to give tenants an interest in their housing costs and to deter private sector landlords from charging higher rents to those claiming Housing Benefit than they would be able to get from tenants who are not in receipt of Housing Benefit.

  The available information on family units receiving Housing Benefit and Income Support and Incapacity Benefit who were assessed under the local reference rent scheme in May 1998 (the latest date for which figures are available) is set out in the tables. It is important to note that there is no direct correlation between the average amounts of rent restriction shown in the tables and families' actual incomes which will vary with individual circumstances. For a family on Income Support their actual income may be higher than Income Support levels because of the various disregards on both earned and unearned income. In addition, local authorities have discretionary powers to make additional payments where they judge that the rent restriction would cause the family exceptional hardship.

  Housing and Council Tax Benefit in the London borough of Islington. This inspection is part of a programme to inspect the 30 authorities with the highest Housing Benefit programme spend. The Benefit Fraud Inspectorate is working closely with the authority and expects to present the report to me for publication early in 2001.

  The Department is aware of media reports on the administration of Housing Benefit in Islington and of the hon. Member's interest in this issue. However, we have not received any other representations on Housing Benefit administration in Islington.
  531W
  Where local authorities choose to contract out support functions for their benefit services, the local authority remains statutorily accountable for the service. It is their responsibility to manage these contracts robustly.

  The Benefit Fraud Inspectorate's work will contribute to ensuring that Islington's claimants receive an appropriate level of service. Where the inspection report identifies weaknesses we shall expect the authority to remedy them. If appropriate the Secretary of State has powers to direct authorities on the standards they are to meet and the timescales for achieving them.

  More widely, Best Value performance indicators have also been introduced from this April for all local authorities. The indicators we have set for Housing Benefit delivery are designed to ensure that authorities provide their communities with a faster, more accurate service which is more secure against fraud, and which provides value for money and takes account of the views and needs of clients.

  Mr. Corbyn
  To ask the Secretary of State for Social Security what his Department's estimate is of the profits made to date by IT Net from the Housing Benefit contract with the London Borough of Islington. [127908]

  Angela Eagle
  Information on any profits made by IT Net is not held by the Department.

  Advertising
  Mr. Loughton
  To ask the Secretary of State for Social Security how much has been spent by his Department on advertising in each year since May 1997. [125696]

  Mr. Bayley
  [holding answer 20 June 2000]: The information is in the table.

  The totals given for 1999–2000 are estimated outturns. The budget for 2000–01 has not yet been finalised.

  The figure given for 1997–98 reflects the low advertising activity carried out in the immediate post election period and subsequent review of Departmental policies. The figures for 1998–99 and 1999–2000 are consistent with the amounts spent on advertising in the five years prior to 1997–98.

  year

  £

  1997–98

  1,958,231

  1998–99

  6,529,593

  1999–2000

  4,791,178

  Pensioner Incomes
  Mr. Coaker
  To ask the Secretary of State for Social Security if he will conduct an analysis of the comparative position of pensioners in(a) the UK and (b) other EU states; and if he will make a statement. [127617]

  Mr. Rooker
  Analyses of the comparative position of pensioners in the UK, in terms of income, are included in the publications "Households Below Average Income" 1994–95 to 1997–98 and "The Pensioners' Incomes Series" 1997–98, both of which are available in the Library.
  532W
  Aspects of pensioner income and poverty in different EU states are covered in selected papers in the "Statistics in Focus" series, published by Eurostat. Copies are held in the Library. There are no plans for the Department to conduct a separate analysis of the comparative position of pensioners in other EU states.

  Disability Living Allowance (Epileptics)
  Mr. Sarwar
  To ask the Secretary of State for Social Security if he will make a statement on(a) the special needs of people affected by epilepsy in applying for Disability Living Allowance and (b) Government proposals to improve the application process relating to them. [127722]

  Mr. Bayley
  Eligibility for Disability Living Allowance (DLA) is based on a person's needs, and not on recognition of their specific medical condition. People with epilepsy, as with other potentially disabling conditions, are therefore asked by the Benefits Agency to state their care and mobility needs arising from their condition when completing a DLA claim form. Decision makers are given information on the care and mobility needs arising from disabilities, including epilepsy, in the "Disability Handbook", which is compiled by senior doctors in the Department and approved and monitored by the Disability Living Allowance Advisory Board. People claiming DLA are also able to make free calls to the Benefits Inquiry Line to help them with their application.

  It is particularly important, given the potentially vulnerable nature of claimants and their carers, that the application process for disability benefits is as straightforward and sensitive as possible. In consultation with a small group of disability organisations, we are trialling improved ways of gathering the information we need to deal with claims. This includes visiting claimants in their homes, to help us get a clearer picture of their disability and how it affects them.

  Social Fund
  Mr. Love
  To ask the Secretary of State for Social Security what plans he has to increase the level of the Social Fund; and if he will make a statement. [127838]

  Angela Eagle
  The gross discretionary Social Fund budget increases each year, mainly through the recycling of loan repayments. Since the fund started, almost 17 million loans worth over £3 billion have been made for a net cost of £492 million.

  Between 1997–98 and 2000–01 the gross budget has increased by over £128 million or 27 per cent. The size and allocation of the gross budget for 2001–02 will be announced in late March.

  Information on expenditure is contained in the Secretary of State's Annual Reports on the Social Fund, copies of which are available in the House Library.

  Details of the discretionary Social Fund budget for 2000–01 are available in the written answer I gave my hon. Friend the Member for Blackpool, North and Fleetwood (Mrs. Humble) on 3 April 2000, Official Report, column 339W.

  Minimum Income Guarantee
  Miss Geraldine Smith
  To ask the Secretary of State for Social Security how many(a) pensioners and (b) families in Morecambe and Lunesdale benefit from the Minimum Income Guarantee. [127633]

  Mr. Bayley
  The information is in the table.

  Numbers benefiting from the Minimum Income Guarantee in Morecambe and Lunesdale

  Number

  Pensioners

  3,000

  Pensioners with dependants

  100

  Notes:

  1.Pensioners-are defined as where the claimant, and/or partner are aged 60 or over.

  2.Pensioners with dependants—are defined as pensioners with dependants aged 18 or under.

  3.Figures are based on a 5 per cent. sample and are rounded to the nearest 100. They are therefore subject to a degree of sampling error.

  4.Figures under 500 are based on very few sample cases and so subject to a higher degree of sampling error and so should only be used as a guide to the current situation.

  Source:

  Income Support Quarterly Statistical Enquiry, February 2000

  Opinion Research
  Mr. Don Foster
  To ask the Secretary of State for Social Security, pursuant to his answer of 8 June 2000,Official Report, column 324W, on opinion research, what steps have been taken to ensure that his Department makes such results publicly available in the form required by paragraph 19 of the Cabinet Office Guidelines into Public Attitudes and Opinion Research. [127792]

  Mr. Rooker
  In line with Cabinet Office guidelines, public attitude or opinion research commissioned by the Department is generally either published or made available on request.

  The Communications Directorate of the Department commissions research to develop and evaluate publicity campaigns or to inform other presentational issues. All reports are either placed in the Library or are available on request. If a report is not available, this may be because the full research has not yet been completed (ie reports not yet finalised by contractors, or the fieldwork is still in progress) or findings are still being employed to inform the communications activity.

  Minimum Funding Requirement
  Mr. Matthew Taylor
  To ask the Secretary of State for Social Security when he will announce the results of the review of the minimum funding requirement; and if he will make a statement. [127801]

  Mr. Rooker
  We have now received the report from the Faculty and Institute of Actuaries on the review of the minimum funding requirement and are considering it. We will be consulting on any proposals for change.

  Widows Benefit
  Mr. Waterson
  To ask the Secretary of State for Social Security what proposals he has to compensate widowers following the recent ruling of the European Court of Human Rights declaring Widows Benefit to be discriminatory. [127864]
  534W
  Angela Eagle
  There has been no such ruling from the European Court of Human Rights. The ECHR's published judgments on two cases explained that, having reached a friendly settlement, these cases have been struck out of the list.

  Parliamentary Questions
  Mr. Maclennan
  To ask the Secretary of State for Social Security how many parliamentary questions were tabled to his Department between 19 October 1999 and 20 April which requested information, pursuant to his previous answers. [128007]

  Mr. Rooker
  Between 19 October 1999 and 20 April 2000 we received 57 questions which requested information pursuant to previous answers.

FOREIGN AND COMMONWEALTH AFFAIRS

  Serbia
  Mr. Maude
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on Serbia's exports of wheat and maize to(a) Libya, (b) Iraq and (c) Syria. [126627]

  Mr. Vaz
  [holding answer 19 June 2000]: We do not have reliable statistics on the volume of Serbian or Federal Republic of Yugoslavia (FRY) grain exports to Iraq, Libya and Syria. However, according to official FRY figures, FRY exports to all developing countries represent only 7.3 per cent. of total exports and are unlikely to do much to reduce the FRY' s growing trade deficit. We do not believe that stocks available for export are high.

  Qualified Majority Voting
  Mr. Redwood
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list the matters currently decided by the Department of Health which could be determined by a qualified majority vote in the EU if the Draft Treaty of Nice is agreed. [126576]

  Mr. Vaz
  [holding answer 19 June 2000]: Extension of QMV is on the agenda of the Intergovernmental Conference, but we are still at a relatively early stage in the negotiations. There is no draft Treaty. The Commission has put forward its opinion on the IGC, but Treaty change is a matter for the member states. The Presidency report to the European Council in Feira outlined areas for discussion in the second half of this year. However, except for the rules of procedure of the European Courts, no area has yet attracted consensus for a move to QMV.

  Visit Visas
  Fiona Mactaggart
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will list, for each British post abroad which operates a preliminary assessment sift system for people applying for visit visas, how many people(a) were advised to withdraw their applications and (b) followed that advice in 1999. [127110]
  535W
  Mr. Vaz
  I regret that we do not maintain statistics on the number of people advised to withdraw applications. However, our records show that just over 55,000 applicants actually withdrew during 1999. This figure was broken down as follows:

  Number

  Abu Dhabi

  60

  Accra

  1,405

  Addis Ababa

  2,210

  Amman

  344

  Amsterdam

  254

  Bangkok

  46

  Banjul

  687

  Beirut

  3

  Bombay

  5,212

  Bucharest

  214

  Cairo

  302

  Calcutta

  109

  Canberra

  52

  Casablanca

  330

  Colombo

  13

  Copenhagen

  40

  Damascus

  924

  Dhaka

  1,002

  Dubai

  192

  Dublin

  177

  Dusseldorf

  564

  Geneva

  105

  Islamabad

  22,943

  Kampala

  21

  Kiev

  1

  Kingston

  858

  Lagos

  1,341

  Los Angeles

  2,435

  Madras

  1,101

  Madrid

  2

  Manila

  119

  Nairobi

  2

  New Delhi

  6,078

  Oslo

  84

  Paris

  1,741

  Quito

  819

  Rome

  349

  Sanaa

  779

  Sarajevo

  20

  Sofia

  1

  Stockholm

  38

  Tehran

  1,835

  Tunis

  493

  Wellington

  79

  Latvia
  Mr. Berry
  To ask the Secretary of State for Foreign and Commonwealth Affairs what arrangements there are for housing the commercial section of the British Embassy in Riga; how many staff are employed by the commercial section, broken down by(a) UK-based and (b) locally-employed staff; how much space the section occupies; and what plans he has to rehouse the section in preparation for the British Week to be held in Riga in 2001. [127858]

  Mr. Vaz
  The Commercial section in Riga is in the main Embassy building. The Embassy is currently undergoing refurbishment and reorganisation, which will improve the quality of Commercial Section accommodation and make it more accessible to visitors.
  536W
  There are four full-time commercial staff in Riga: one UK-based and three locally engaged.

  The Commercial Section occupies approximately 52m2. An additional 28m2 is available on the lower ground floor.

  There are no plans to rehouse the Section in preparation for British Week in 2001: we do not regard this as necessary.

  Kosovo
  Ms Squire
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the export of de-mining vehicles to the HALO Trust in Kosovo. [128297]

  Mr. Vaz
  The Government have granted a licence for the export to the Federal Republic of Yugoslavia (FRY) of an armour protected wheel loading tractor for use by the HALO Trust, an organisation engaged in humanitarian de-mining activities in Kosovo on behalf of the United Nations Interim Administration Mission in Kosovo (UNMIK). This vehicle is rated on the UK's Military List.

  Although UN Security Council resolution (UNSCR) 1160 (1998) imposed an arms embargo on the FRY, UNSCR 1160 shall not apply to the sale or supply of arms and related material for use by the international civil and security presence in Kosovo. We have notified the UN FRY Sanctions Committee of this export and they have raised no objection.

  Thailand
  Mr. Hilary Benn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he made about the case of Sandra Gregory during his recent visit to Thailand; and if he will make a statement. [128147]

  Mr. Hain
  My right hon. Friend the Secretary of State was briefed on the case of Sandra Gregory before his visit to Thailand. However, he did not raise any consular issues during his visit.

  Ms Gregory submitted a Royal Pardon Petition in May 1997. Ms Gregory is waiting for His Majesty the King of Thailand to make his decision on her application. Our Embassy in Bangkok continues to make regular inquiries with the Thai authorities on the progress of Ms Gregory's Royal Pardon Petition.

  Jordan
  Mr. Malcolm Bruce
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to visit Jordan to discuss trade issues. [127811]

  Mr. Hain
  My right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs visited Jordan in January 2000 and I did so in March 2000 when trade issues were discussed.

  Indonesia (Arms Exports)
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent assessment he has made of the(a) use and (b) location of British arms exported to Indonesia; and if he will make a statement. [127891]
  537W
  Mr. Battle
  We are in close touch with our Embassy in Jakarta on this issue and we have seen no evidence that any of the reduced amount of military equipment supplied by this Administration has been used for internal repression in Indonesia. We have asked for and received assurances from the Indonesian Government that UK supplied equipment, wherever it is located in Indonesia, is not used for internal repression.

  Saudi Arabia (Human Rights)
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Government of Saudi Arabia concerning abuse of human rights; and if he will make a statement. [127892]

  Mr. Hain
  We are firmly committed to constructive engagement on human rights with Saudi Arabia and discuss the issue regularly with the Saudis. My right hon. Friend the Foreign Secretary did so most recently on 22 May at the EU/GCC Joint Ministerial Meeting in Brussels with the Saudi Foreign Minister.

  West Papua
  Mr. Corbyn
  To ask the Secretary of State for Foreign and Commonwealth Affairs which representatives from the British Embassy in Jakarta, Indonesia, attended the congress for self-determination in Japura, West Papua; and if he will make a statement. [127904]

  Mr. Battle
  No representatives from the British Embassy attended the Papuan Congress in Jayapura. In light of the declaration made by the Congress, the EU issued a statement on 8 June stressing its support for a strong, democratic, united and prosperous Indonesia. It also reaffirmed its support for Indonesia's territorial integrity and for the efforts of the current Indonesian Government to solve problems, such as in Aceh and West Papua, through peaceful negotiation.

TREASURY

  Working Families Tax Credit
  Mrs. Curtis-Thomas
  To ask the Chancellor of the Exchequer how many families have received the Working Families Tax Credit in the Crosby constituency. [127168]

  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. Available figures by constituency are given in tables which have been deposited in the Library.

  Ms Roseanna Cunningham
  To ask the Chancellor of the Exchequer what assessment he has made of the practicalities of paying Working Families Tax Credit by means other than through employers; what assessment he has made of the impact of the Convention for the Protection of Individuals with regard to automatic processing of personal data (ETS No. 108, 28.1.1981) on his policy on payment of Working Families Tax Credit; and what assessment he has made of Recommendation No. R(90) 19, adopted by the Committee of Ministers, on the Protection of Personal Data used for payment and other related operations on 13 September 1990. [128025]
  538W
  Dawn Primarolo
  Paying Working Families Tax Credit (WFTC) through the wage packet helps to demonstrate the rewards of work and to make work pay for families on low incomes. An employee applying for WFTC will be paid the tax credit by his or her employer as part of the pay packet and will be able to see clearly the amount of tax credit being paid in each pay period. If the applicant is self-employed or is not working the tax credit is paid by the Inland Revenue either by Automatic Credit Transfer (ACT) into a bank account or by Order Book.

  The Government's policy on payment of WFTC does not conflict with the provisions of the Council of Europe Convention for the Protection of Individuals with regard to automatic processing of personal data (ETS No. 108, 28.1.1981) or the associated Recommendation No. R(90) 19.

  Stress Audit
  Mr. Fallon
  To ask the Chancellor of the Exchequer if he will place in the Library a copy of the independently conducted Stress Audit of the Treasury. [127885]

  Mr. Timms
  I have done so.

  Correspondence
  Sir Brian Mawhinney
  To ask the Chancellor of the Exchequer when the right hon. Member for North-West Cambridgeshire will receive a reply to his letter of 3 April on behalf of his constituent the Reverend Mr. Leeke. [127890]

  Mr. Andrew Smith
  I replied to the right hon. Member on 5 June. A further copy will be forwarded.

  National Minimum Wage
  Mrs. Curtis-Thomas
  To ask the Chancellor of the Exchequer what estimate he has made of the numbers of people in the Crosby constituency that have benefited from the minimum wage. [127171]

  Miss Melanie Johnson
  The information requested falls within the responsibility of the National Statistician. I have asked him to reply.

  Letter from Len Cook to Mrs. Curtis-Thomas, dated 28 June 2000:
  As National Statistician I have been asked to reply to your recent question regarding the number of people who have been affected by the national minimum wage in the Crosby constituency.
  Definitive estimates on the number of people that have been affected by the national minimum wage are not yet available. Currently available estimates for assessing the effect draw on data from both the New Earnings Survey and the Labour Force Survey, and recognise the particular value that each survey adds to the quality and analytical details that can be provided. However, the latest adjusted estimates are mainly based on data for the spring (March-May) 1999 Labour Force Survey. Because the reference period spans the implementation date for the National Minimum Wage Act on 1 April 1999, these adjusted estimates are unlikely to accurately measure the effect of the Minimum Wage legislation since there are employees who could have been earning below the minimum wage rates in March 1999, before the law took effect.
  The currently available estimates for March-May 1999 were published in an Office for National Statistics (ONS) First Release on 14 October 1999 and show that the number of people earning

  539W
  below the minimum wage rates set in April 1999 had fallen significantly between 1998 and 1999. A copy of this first release is available in the House of Commons Library.

  Miss Geraldine Smith
  To ask the Chancellor of the Exchequer if he will estimate how many people in Morecambe and Lunesdale have benefited from the national minimum wage. [127632]

  Miss Melanie Johnson
  The information requested falls within the responsibility of the National Statistician. I have asked him to reply.

  Letter from Len Cook to Miss Geraldine Smith, dated 28 June 2000:
  As National Statistician I have been asked to reply to your recent question regarding the number of people who have been affected by the national minimum wage in the Morecambe and Lunesdale constituency (127632).
  Definitive estimates on the number of people that have been affected by the national minimum wage are not yet available. Currently available estimates for assessing the effect draw on data from both the New Earnings Survey and the Labour Force Survey, and recognise the particular value that each survey adds to the quality and analytical details that can be provided. However, the latest adjusted estimates are mainly based on data for the Spring (March-May) 1999 Labour Force Survey. Because the reference period spans the implementation date for the National Minimum Wage Act on 1 April 1999, these adjusted estimates are unlikely to accurately measure the effect of this Legislation since there are employees who could have been earning below the minimum wage rates in March 1999, before the law took effect.
  The currently available estimates for March-May 1999 were published in an Office for National Statistics (ONS) First Release on 14 October 1999 and show that the number of people earning below the minimum wage rates set in April 1999 had fallen significantly between 1998 and 1999. A copy of this first release is available in the House of Commons Library.

  Single Currency
  Mr. Mitchell
  To ask the Chancellor of the Exchequer how the rate of entry for Sterling into the euro will be determined; what the scope is for negotiation of the rate; how long the exchange rate has to be maintained before entry; and if the relativity to be maintained to the euro allows for changes in the euro rate. [127557]

  Miss Melanie Johnson
  The rate at which sterling would enter the single currency would need to be consistent with economic fundamentals in the UK and compatible with sustainable convergence between the UK and other euro area economies.

  Average Wage (Young People)
  Mr. Coaker
  To ask the Chancellor of the Exchequer what estimate he has made of the average wage paid to 16 and 17 year-olds in full-time work with no training. [127616]

  Miss Melanie Johnson
  The information requested falls within the responsibility of the National Statistician. I have asked him to reply.

  Letter from Len Cook to Mr. Vernon Coaker, dated 28 June 2000:
  As National Statistician, I have been asked to reply to your recent question regarding the average wage of 16 and 17 year-olds in full-time work with no training. (127616)
  The Labour Force Survey (LFS) is National Statistics' major source of labour market data on individuals and is the most appropriate source of data to answer this question. LFS estimates
  540W
  show that in the UK in winter (December to February) 1999/2000, the average gross weekly earnings of 16 and 17 year-old full-time employees who had not received any job-related training in the last 13 weeks and were not currently enrolled on an education course was £139. This estimate is not seasonally adjusted.

  Internet Access
  Mr. Matthew Taylor
  To ask the Chancellor of the Exchequer, pursuant to his answer of 19 June 2000,Official Report, column 105W, on the knowledge economy, how he defines access to the internet through a public access point; on what terms such access shall be available; and if he will make a statement. [127865]

  Mr. Andrew Smith
  Public internet access points are defined as any facility, whether provided by the public, voluntary, or private sector, which provides internet access for the general public. The Government are making community internet access points available through a number of initiatives, including ICT learning centres, and putting libraries on-line.

  Non-contributory Benefits
  Mr. Ian Bruce
  To ask the Chancellor of the Exchequer how much was paid from the National Insurance Fund to pay for non-contributory benefits in the last financial year. [127986]

  Dawn Primarolo
  [holding answer 27 June 2000): Appendix 4 of the Government Actuary's Benefits up-rating report (Cm 4587) lists the estimated payments from the National Insurance Fund for both contributory and non-contributory benefits.

  Motor Fuel
  Mr. St. Aubyn
  To ask the Chancellor of the Exchequer (1) what study his Department has made of the implications for the United Kingdom economy of rising motor fuel prices;[127733]

  (2) if he will assess the impact for the United Kingdom economy of petrol prices reaching £4 per gallon before 31 March 2001. [127734]

  Mr. Timms
  The Budget economic forecast took into account developments in motor fuel prices up to mid-March and their implications for both economic activity and inflation. The Treasury's next assessment of economic prospects, including the impact from higher world oil prices, will be published in the pre-Budget Report later this year.

  Interactive Voice Response Systems
  Mr. Ben Chapman
  To ask the Chancellor of the Exchequer (1) how many agencies of his Department use interactive voice response systems when dealing with telephone inquiries from the general public; [127117]

  (2) how many of his Department's telephone lines used by the general public are responded to by interactive voice response systems. [127389]

  Miss Melanie Johnson
  There are no Voice Recognition Systems used.

  Electronic Data Systems
  Mr. Field
  To ask the Chancellor of the Exchequer which Government Departments have(a) contracts and (b) framework agreements with Electronic Data Systems. [121789]

  Mr. Timms
  [holding answer 12 May 2000]: The following Government Departments currently have contracts with Electronic Data Systems (EDS):

  Department of the Environment, Transport and the Regions

  Department for Education and Employment

  Department of Social Security

  Home Office (Prison Service)

  Inland Revenue

  Lord Chancellor's Department

  Ministry of Defence

  Treasury (Office of Government Commerce).

  Of the contracts listed, three are framework agreements (one with MOD and two with the Treasury (OGC)).

  Road Tolls (VAT)
  Mr. Webb
  To ask the Chancellor of the Exchequer if he will estimate the amount of VAT which the UK would be required to collect if the proposed extension of VAT to road tolls were to be applied retrospectively. [127384]

  Dawn Primarolo
  If, in its judgment due on 12 September, the European Court of Justice agrees with the earlier opinion of the Advocate-General—that VAT should be charged on road tolls—VAT will not be imposed upon motorists or toll operators retrospectively. It may, however, be necessary for the UK to recalculate contributions made to the European Commission budget from 1984. While it is not possible accurately to calculate the amount involved, it will be very small in relation to our overall contribution.

  Tax Demands
  Mr. Alasdair Morgan
  To ask the Chancellor of the Exchequer how many income tax demands for amounts under £5 were dispatched in the last tax year; what the total value of the tax billed in these demands was; and what the estimated cost of recovering the tax was. [127649]

  Estimate of number of recipients of Family Credit (FC) at the end of April 1997

  Provisional estimate of number of recipients of Working Families Tam Credit (WFTC) at the end of April 2000

  North-East region

  45,900

  61,000

  Newcastle upon Tyne local authority

  4,300

  5,200

  Newcastle upon Tyne, Central constituency

  1,100

  1,300

  Note:

  All the estimates in the table are based on 5 per cent. samples of awards and are therefore subject to sampling error. This should be borne in mind when making comparisons over time, by area, and between types of award.

  For the North-East region, the average FC award at April 1997 was £58 per week, and the provisional estimate of the average WFTC award at April 2000 is £71 per week. The corresponding figures for WFTC awards with and without
  542W
  Dawn Primarolo
  Taxpayers within Self Assessment are issued with statements at specific points in their tax affairs showing the current position, which may include small amounts. Information on how many such debts there are at any given time is not available.

  Pensioners (Self-assessment)
  Mr. Cousins
  To ask the Chancellor of the Exchequer what plans he has to simplify tax self-assessment for pensioners; and what advice and support the Inland Revenue provides for the completion of such forms. [127878]

  Dawn Primarolo
  The Government want to minimise the number of people who have to complete self-assessment tax returns. That is why last July I announced changes to the criteria determining who should receive self-assessment tax returns which meant that up to 200,000 older people should no longer have to complete returns. The Inland Revenue are considering whether there are other changes which can be made.

  For those pensioners who have to complete a tax return the Revenue is committed to giving the help they need. The Inland Revenue will help pensioners complete any forms if they cannot complete them themselves. They will visit the pensioner in his or her home if a face-to-face discussion is necessary and the pensioner is too infirm to get to the local tax office. Most Inland Revenue offices are equipped with magnifying lenses and induction loops—and all will be within the next few months. For those who prefer to contact the Revenue by telephone, they can contact their own tax office or use the helpline on 0845 9000 444. Research shows that the Revenue's help is valued as pensioners are the Inland Revenue's most satisfied customer group.

  Tax Credits
  Mr. Cousins
  To ask the Chancellor of the Exchequer how many claimants of Family Credit there were in(a) the North-East region, (b) the City of Newcastle and (c) the constituency of Newcastle upon Tyne, Central in April 1997; what was the average payment of Family Credit in each area; how many claimants of the Working Families Tax Credit there are for (a), (b) and (c); and what has been the average payment of Working Families Tax Credit (i) with and (ii) without child care tax credit. [127880]

  Dawn Primarolo
  The estimated numbers of families in receipt of awards are as follows:

  the child care tax credit are £88 per week and £70 per week, respectively. There are too few sample cases to provide reliable estimates of average awards at the local authority or constituency level.

  IR35
  Mr. Ottaway
  To ask the Chancellor of the Exchequer of the IR35 contracts examined by the Inland Revenue, what were the job categories of the contracts submitted; how many were found to be(a) exempt and (b) not exempt from the IR 35 rates; and if he has revised the expected revenue yield from IR35. [127868]

  Dawn Primarolo
  I refer the hon. Member to the remarks I made in the course of the Finance Bill Standing Committee Debate on 6 June 2000,Official Report, Standing Committee, column 450.

  Parliamentary Questions
  Mr. Field
  To ask the Chancellor of the Exchequer, pursuant to his answer of 19 June 2000,Official Report, column 106W, on what date he will answer the question tabled by the right hon. Member for Birkenhead on 9 May. [128034]

  Mr. Timms
  I have done so today, at column 541W.

EDUCATION AND EMPLOYMENT

  ONE Service
  Mrs. Gillan
  To ask the Secretary of State for Education and Employment what back-up systems exist to assist jobseekers in the case of the(a) breakdown and (b) malfunctioning of the ONE system; when he will review the operation of the ONE system; and if he will make a statement. [125891]

  Ms Jowell
  [holding answer 13 June 2000]: The ONE Call Centre service, one of the three main variants of the ONE model, is proving popular with clients and staff. It streamlines the service and makes it more convenient to clients, who are able to provide information by telephone.

  The ONE Call Centre service is delivered from four sites. Each pilot has agreed contingency plans in the event of a breakdown or malfunction of systems, which ensures that the delivery of services to jobseekers is not put at risk.

  The advantage of having four sites sharing the same telephony and IT is that, should a breakdown or malfunction occur in one site, the service can be offered by telephone from one of the other three call centres. Additional contingency plans involve the delivery of services face to face and the use of clerical records and forms rather than IT systems. These contingencies have been tested by the pilots in a number of situations since they became operational on 29 November 1999 and have proven robust.

  The operation of the ONE pilots is under constant review and regular reports are provided to Ministers. The pilots are due to run for three years (to March 2002) and a formal evaluation will be completed at that time.

  Mr. Matthew Taylor
  To ask the Secretary of State for Education and Employment which organisations and individuals he has consulted while undertaking the cross departmental review on Welfare to Work and ONE; in what form he has consulted them; on how many occasions he has met them; and if he will make a statement. [126294]
  544W
  Ms Jowell
  [holding answer 19 June 2000]: All the Departments involved have consulted widely with both individuals and groups from all the Departments. This was reinforced by a seminar which included many people from the academic and wider policy community held on 18 January 2000 to discuss policy priorities. We have also sought other advice during the course of the review, for instance, from the New Deal Task Force.

  The Welfare to Work and ONE Spending Review is progressing well. In due course details of all aspects of the 2000 Spending Review will be included in a Spending Review White Paper in the normal way.

  Teachers (Early Leavers)
  Mr. Clappison
  To ask the Secretary of State for Education and Employment how many(a) primary and (b) secondary school teachers left the teaching profession before reaching the age of 40 in each of the last 10 years; and how many of them did so within five years of qualifying as a teacher. [126315]

  Ms Estelle Morris
  The following table shows the number of maintained nursery, primary and secondary full and part-time teachers in England who left the maintained nursery, primary, secondary, special and PRU sector1,2 under age 40 and the number who left within five years of qualifying as a teacher.

  Nursery/primary teachers aged under 40

  Secondary teachers aged under 40

  Financial year

  All leavers

  Leavers within five years

  All leavers

  Leavers within five years

  1988–89

  6,300

  1,300

  10,000

  2,300

  1989–90

  5,900

  1,800

  8,900

  2,400

  1990–91

  6,800

  2,200

  8,600

  2,400

  1991–92

  5,900

  2,000

  6,600

  2,000

  1992–93

  5,100

  1,800

  5,700

  1,800

  1993–94

  4,600

  1,800

  5,100

  1,700

  1994–95

  5,100

  2,100

  5,400

  2,100

  1995–96

  4,400

  1,900

  5,000

  2,300

  1996–97

  4,700

  2,100

  4,900

  2,400

  1997–98

  5,000

  2,200

  5,100

  2,500

  1Excludes those leaving sixth form colleges. Sixth form colleges became part of the FE sector as at 1 March 1993.

  2Includes those taking ill-health retirement, barred and dying in service, which amounts to less than 200 in either phase for any year

  Note:

  Figures are rounded to the nearest 100.

  There was a growth in total numbers of 3,500 full-time equivalent regular teachers in maintained nursery/primary schools and 3,100 full-time equivalent regular teachers in maintained secondary schools between January 1998 and January 2000.

  Cars for Work Scheme
  Mr. Allan
  To ask the Secretary of State for Education and Employment (1) how many people he estimates will participate in the Cars for Work scheme;[126844]

  (2) if he has made an environmental impact assessment of the implementation of the Cars for Work scheme;[126842]

  (3) how the Cars for Work scheme will be evaluated; and if he will make a statement. [126843]
  545W
  Ms Jowell
  Car loan or leasing schemes may form part of the forthcoming Action Teams for Jobs initiative. In these areas we are setting up specialist teams to tackle the barriers that stop jobless people in deprived communities taking up work. Each team will have the flexibility to focus its resource on solving the problems unique to its area. This will include solutions to transport problems but will also cover other barriers to finding, keeping and progressing in work. Action Teams will be fully evaluated and the findings published in due course.

  New Deal
  Dr. Strang
  To ask the Secretary of State for Education and Employment how many people had left the New Deal

  (a)Edinburgh

  (b)Edinburgh East and Musselburgh

  (1)left income support and went into employment

  198

  33

  (2)left income support and transferred to other benefits

  5

  1

  (3)left income support and became ineligible for NDLP

  39

  5

  (4)were still on income support and went into employment

  3

  1

  (5)were still on income support and declined to join the caseload

  10

  1

  (6)were still on income support and withdrew for other reasons

  166

  31

  Note:

  These figures are cumulative to the end of March 2000

  Dr. Strang
  To ask the Secretary of State for Education and Employment how many people were on the New Deal for Lone Parents in(a) Edinburgh, (b) Edinburgh, East and Musselburgh, (c) Scotland and (d) Great Britain (i) at the end of March and (ii) at the latest available date who were (1) receiving advice and guidance, (2) in education

  (a)Edinburgh

  (b)Edinburgh, East and Musselburgh

  (c)Scotland

  (d)Great Britain

  (1)receiving advice and guidance

  340

  79

  4,305

  48,640

  (2)in education and training

  72

  11

  660

  7,500

  (3)receiving in work support on IS

  3

  0

  69

  1,070

  (4)receiving in work support off IS

  161

  42

  1,599

  17,940

  Note:

  These figures are cumulative to the end of March 2000

  Dr. Strang
  To ask the Secretary of State for Education and Employment how many people in(a) Edinburgh, (b) Edinburgh, East and Musselburgh, (c) Scotland and (d) Great Britain, (i) up to the end of March and (ii) up to the latest available date have (1) found sustained subsidised employment, (2) found sustained and unsubsidised employment, (3) found subsidised employment for less

  Edinburgh

  Edinburgh, East and Musselburgh

  Scotland

  Great Britain

  Sustained subsidised employment

  43

  7

  766

  7,800

  Sustained unsubsidised employment

  167

  38

  2,092

  26,920

  Subsidised employment less than 13 weeks

  2

  0

  62

  600

  Unsubsidised employment less than 13 weeks

  30

  4

  538

  5,830

  Mrs. Curtis-Thomas
  To ask the secretary of state for Education and Employment what change in the level of unemployment has occurred in the Crosby constituency as a result of the New Deals. [127172]

  Ms Jowell
  The New Deal for Young People is aimed at people aged 18–24 who have been claiming unemployment benefits for six months or more.
  546W
  for Lone Parents in (a) Edinburgh and (b) Edinburgh, East and Musselburgh, up to (i) the end of March and (ii) the latest available date by immediate destination, including those who (1) left income support and went into employment, (2) left income support and transferred to other benefits, (3) left income support and became ineligible for NDLP, (4) were still on income support and went into employment, (5) were still on income support and declined to join the caseload and (6) were still on income support and withdrew for other reasons. [125751]

  Ms Jowell
  [holding answer 20 June 2000]: The information requested is in the following table:

  and training, (3) receiving in work support on income support and (4) receiving in work support off income support; and how many people in total have been in categories (i) and (ii). [125752]

  Ms Jowell
  [holding answer 20 June 2000]: The information requested is in the following table:

  than 13 weeks and (4) found unsubsidised employment for less than 13 weeks. [125753]

  Ms Jowell
  [holding answer 20 June 2000]: The information requested, covering the period from June 1998 to the end of March 2000, the latest date for which information is available, is contained in the table:

  Claimant unemployment among this group has fallen by 70 per cent. in the three years since April 1997 and by 56 per cent. since April 1998 when the New Deal was introduced. Part of this fall is due to the delivery of a strong and stable economy, but the New Deal for Young People has helped unemployment to fall even faster. The fall of 56 per cent. since the New Deal was introduced compares with a fall of 18 per cent. in total

  547W
  unemployment, 23 per cent. in total youth (18–24) unemployment and 26 per cent. in the total number unemployed for six months or more. The positive effect of the New Deal is confirmed by independent research from the National Institute of Economic and Social Research.

  It is not possible to measure the New Deal effect exactly in each constituency. However, in Crosby the falls in unemployment among the New Deal client group have also been substantially faster than for other groups. In Crosby constituency in the two years since April 1998 claimant unemployment among those aged 18–24, unemployed for six months or more, has fallen by 52 per cent. from 161 to 77. This compares with a fall of 19 per cent. in total unemployment, 31 per cent. in total youth (18–24) unemployment, and 20 per cent. in the total number unemployed for six months or more.

  Edinburgh

  Edinburgh East and Musselburgh

  Scotland

  Great Britain

  Starts to Advisory Interview process

  1,573

  236

  23,180

  232,010

  Unsubsidised jobs from the Advisory Interview Process

  160

  35

  1,910

  24,100

  Left for other benefits

  119

  22

  2,080

  19,700

  Subsidised employment starts

  52

  9

  1,000

  10,100

  Education and Training opportunity

  61

  7

  240

  5,700

  Training for work starts

  63

  5

  1,240

  15,800

  Starts to Follow Through

  28

  4

  350

  4,050

  Dr. Strang
  To ask the Secretary of State for Education and Employment what was the total number of people in(a) Scotland and (b) Edinburgh who had (i) joined the 18–24 New Deal, (ii) gained subsidised jobs from the 18–24 New Deal, (iii) gained unsubsidised jobs from the 18–24 New Deal, (iv) started on the 18–24 New Deal Gateway, v) entered each of the 18–24 New Deal options and (vi) been on Follow-Through by (1) the end of March 2000 and (2) the latest available date. [126308]

  Ms Jowell
  [holding answer 22 June 2000]: The information to the end of March 2000, which is the latest available, is as follows:

  Edinburgh

  Scotland

  New Deal 18–24 starts

  3,099

  50,560

  subsidised job starts

  1232

  14,420

  unsubsidised job starts

  1,238

  20,900

  Gateway starts

  2,739

  45,020

  starts to Employment option

  1232

  14,420

  starts to Full-time Education and Training option

  397

  7,710

  Starts to Voluntary Sector option

  239

  4,010

  Starts to Environment Task Force option

  194

  4,340

  starts to Follow Through

  594

  10,290

  1Subsidised job starts and starts to the employment option are the same figure

  Miss Geraldine Smith
  To ask the Secretary of State for Education and Employment how many people in Morecambe and Lunesdale have participated in New Deal programmes. [127637]

  Ms Jowell
  Latest figures to the end of March 2000, show that in Morecambe and Lunesdale parliamentary constituency, 873 young people have started the New Deal for Young People, 461 have started the New Deal for long-term unemployed people aged 25 or over, and 229 have started the new Deal for Lone Parents. It is a measure of the success of the Government's Welfare to Work policies that 573 people in Morecambe and
  548W
  Dr. Strang
  To ask the Secretary of State for Education and Employment what was the total number of people in(a) Scotland, (b) Great Britain, (c) Edinburgh and (d) Edinburgh East and Musselburgh involved in the New Deal for 25-plus, (i) at the end of March 2000 and (ii) at the latest available date, who (1) had been in the advisory interview process, (2) had found unsubsidised jobs through the advisory interview process, (3) had transferred to other provision, (4) had entered subsidised employment, (5) had taken education and training opportunities, (6) had entered Training for Work and (7) had entered Follow Through. [126307]

  Ms Jowell
  [holding answer 22 June 2000]: The information to the end of March 2000, is contained in the table.

  Lunesdale have found work through the New Deals. Many other people in Morecambe and Lunesdale are benefiting from the New Deals for the disabled, partners of the unemployed and 50 plus.

  Mr. Martlew
  To ask the Secretary of State for Education and Employment how many people in Carlisle have(a) joined the New Deal for 18 to 24 year olds, (b)gained subsidised jobs, (c) gained unsubsidised jobs and (d) started on the New Deal Gateway to date. [127808]

  Ms Jowell
  Latest figures to the end of March 2000, show that in Carlisle parliamentary constituency, 681 young people have started New Deal. 334 of these have gained unsubsidised jobs and 85 started on the subsidised Employment option. 622 young people have started on the New Deal Gateway. We are well on target to meet our commitment of helping 250,000 young people into jobs through the New Deal.

  Equal Rights
  Mr. Bercow
  To ask the Secretary of State for Education and Employment if he will make a statement on the impact of the decisions made by the European Commission in its meeting of 7 June on equal rights legislation in the United Kingdom; and what his policy is thereon. [127185]

  Ms Jowell
  On 7 June the European Commission adopted a Communication on a Community framework strategy on gender equality 2001–05. The strategy includes a proposal that there be a Council Decision on a support programme. The Commission also adopted a proposal that there be a European Parliament and Council Directive amending the Equal Treatment Directive (76/207) on equality for men and women. The Government will study each of the proposals carefully (including any impact on domestic legislation such as the
  549W
  Sex Discrimination Act 1975) and report to Parliament in accordance with the usual procedures for scrutiny of European legislative proposals.

  Class Sizes
  Miss Geraldine Smith
  To ask the Secretary of State for Education and Employment if he will list the primary schools in Morecambe and Lunesdale which have received additional money to reduce class sizes. [127635]

  Ms Estelle Morris
  The schools in Morecambe and Lunesdale which have received additional funding as part of the Government's initiative to limit infant classes to 30 pupils are listed. £620 million is available to support the initiative, and allocations so far to Lancashire LEA amount to nearly £15 million. This has helped to reduce the size of the average Key Stage 1 class in Morecambe and Lunesdale to 26.0. The figure in January 1997 was 29.1.

  Morecambe and Heysham Sandylands Primary

  Slyne with Hest, St. Luke's CE Primary

  Nether Kellet Primary

  Morecambe and Heysham Torrisholme Primary

  Bolton-le-Sands CE Primary

  Heysham St. Peter's CE Primary

  Overton St. Helen's CE Primary

  Great Wood Primary

  Warton Archbishop Hutton's Primary

  Carnforth North Road Primary

  Lancaster Ryelands Primary

  Skerton Community Primary

  Morecambe Bay Community Primary

  Lancaster Road Primary

  Morecambe and Heysham Trumacar Community Primary

  Grosvenor Park Primary

  Carnforth Christ Church CE VA Primary

  St. Wilfrid's CE Primary

  Poulton-le-Sands Ce Primary

  Silverdale St. John's CE VA Primary

  St. Patrick's Catholic Primary

  Over Kellet Wilson's Endowed CE Primary

  St. Mary's Catholic Primary.

  Helen Jones
  To ask the Secretary of State for Education and Employment how many five, six and seven-year-olds in Warrington North constituency were being taught in classes of over 30(a) in May 1997 and (b) on the most recent date for which figures are available. [127320]

  Ms Estelle Morris
  [holding answer 26 June 2000]: The latest available information on class sizes in the Parliamentary constituency of Warrington, North is shown in the table.

  Provisional national estimates of Key Stage 1 class sizes for January 2000 were recently published in a Statistical First Release "Class sizes in maintained schools in England: January 2000 (15/2000)" on 12 April 2000. Class size information broken down by local education authority area is also available from the House of Commons Library.
  550W
  National figures for infant class sizes in September 1999 were published in Statistical First Release "Infant class sizes in England (2/2000)" on 21 January 2000.

  The Government are well on course to limit all infant classes for five, six and 7-year-olds to 30 or below by September 2001 at the latest.

  Number and percentage of pupils in Key Stage 1 classes of size 31 or more taught by one teacher in maintained primary schools in the Parliamentary constituency of Warrington North and England: 1997 and 20001

  Position as at January

  Number of pupils in classes of over 302

  Percentage of pupils in classes of over 30

  1997

  Warrington North

  1,450

  34

  England

  476,820

  29

  2000

  Warrington North

  710

  18

  England

  177,020

  11

  1Provisional

  2Figures have been rounded to the nearest 10 pupils

  Mr. Matthew Taylor
  To ask the Secretary of State for Education and Employment what estimate he has made of the cost of(a) reducing all primary school class sizes to 25 pupils or fewer and (b) introducing a maximum average class size of 25 in primary schools; and if he will make a statement. [127507]

  Ms Estelle Morris
  [holding answer 27 June 2000]: It has been estimated that the cost of reducing class sizes to 25 for all primary school children would be around £3 billion. We have not made an estimate of the cost of a maximum average class size of 25 in primary schools.

  The size of the average primary class fell for the second year running between January 1999 and January 2000, from 27.5 to 27.1, after rising for the previous 10 years. The size of the average primary class in the Truro and St. Austell parliamentary constituency has gone down from 27.5 in January 1997 to 27.2 in January 2000.

  At the same time, we are well on the way to delivering our pledge to limit infant classes to 30 pupils. £620 million is available to support the pledge, and allocations so far to Cornwall LEA amount to some £3.5 million. This has helped to reduce the size of the average Key Stage 1 class in Truro and St. Austell to 24.9. The figure in January 1997 was 25.4.

  Disability Access
  Mr. Boswell
  To ask the Secretary of State for Education and Employment how many toilets at buildings owned or controlled by his Department(a) have and (b) do not have access for disabled people. [127598]

  Mr. Wills
  [holding answer 27 June 2000]: Central records are not kept on the total number of toilets in buildings owned or controlled by the Department. This information could be obtained only at disproportionate cost. Specialist toilet facilities for disabled people are currently available in over 700 (64 per cent.) of these buildings, and we intend to increase the number of buildings that have facilities for disabled people as soon as practicable.

  Teacher Vacancies
  Mr. Willis
  To ask the Secretary of State for Education and Employment how many teacher vacancies in (i) maintained nursery schools, (ii) maintained primary schools and (iii) maintained secondary schools there were in(a) Great Britain and (b) each local education authority, for each year since 1997; and if he will make a statement. [127208]

  1997

  1998

  1999

  2000

  Nursery and Primary

  Secondary

  Nursery and Primary

  Secondary

  Nursery and Primary

  Secondary

  Nursery and primary

  Secondary

  former Durham

  4

  2

  —

  —

  —

  —

  —

  —

  Darlington

  —

  —

  3

  4

  0

  0

  3

  0

  Durham

  —

  —

  11

  7

  2

  0

  2

  0

  Hartlepool

  4

  3

  3

  1

  6

  3

  2

  1

  Middlesbrough

  1

  3

  5

  6

  4

  2

  2

  2

  Redcar and Cleveland

  5

  2

  1

  9

  2

  4

  0

  5

  Stockton on Tees

  3

  9

  3

  6

  2

  5

  1

  5

  Northumberland

  0

  0

  0

  0

  0

  0

  0

  0

  Gateshead

  6

  1

  3

  1

  9

  0

  5

  0

  Newcastle upon Tyne

  4

  1

  3

  2

  7

  10

  4

  5

  North Tyneside

  0

  0

  0

  0

  10

  16

  1

  14

  South Tyneside

  0

  0

  0

  2

  0

  1

  0

  1

  Sunderland

  10

  5

  7

  7

  6

  5

  9

  4

  former Lancashire

  13

  18

  27

  9

  —

  —

  —

  —

  Blackburn with Darwen

  —

  —

  —

  —

  11

  3

  7

  6

  Blackpool

  —

  —

  —

  —

  2

  1

  3

  6

  Lancashire

  —

  —

  —

  —

  18

  12

  17

  4

  former Cheshire

  15

  6

  25

  14

  —

  —

  —

  —

  Halton

  —

  —

  —

  —

  2

  2

  1

  5

  Warrington

  —

  —

  —

  —

  7

  0

  9

  2

  Cheshire

  —

  —

  —

  —

  10

  4

  12

  11

  Cumbria

  0

  4

  1

  1

  0

  2

  0

  0

  Bolton

  1

  0

  0

  2

  0

  2

  0

  1

  Bury

  1

  3

  0

  1

  0

  1

  1

  0

  Manchester

  3

  4

  0

  0

  0

  0

  0

  0

  Oldham

  12

  8

  10

  3

  6

  3

  7

  4

  Rochdale

  9

  0

  10

  2

  4

  2

  2

  2

  Salford

  3

  3

  0

  0

  0

  1

  1

  2

  Stockport

  0

  1

  0

  0

  3

  2

  0

  6

  Tameside

  1

  4

  2

  4

  0

  5

  1

  0

  Trafford

  0

  3

  0

  2

  0

  1

  0

  0

  Wigan

  9

  4

  5

  0

  5

  10

  3

  10

  Knowsley

  1

  3

  6

  7

  3

  1

  5

  6

  Liverpool

  0

  1

  0

  4

  4

  1

  0

  2

  St. Helens

  4

  4

  1

  4

  4

  1

  1

  0

  Sefton

  1

  3

  0

  0

  0

  1

  3

  5

  Wirral

  5

  2

  4

  10

  13

  4

  2

  8

  East Riding of Yorkshire

  0

  0

  1

  0

  4

  0

  2

  0

  City of Kingston Upon Hull

  0

  2

  0

  1

  0

  1

  0

  0

  North East Lincolnshire

  0

  0

  1

  1

  0

  0

  0

  0

  North Lincolnshire

  3

  3

  2

  0

  4

  3

  8

  2

  York

  0

  0

  0

  0

  1

  6

  1

  5

  North Yorkshire

  0

  0

  8

  8

  3

  5

  4

  5

  Barnsley

  1

  0

  2

  5

  1

  1

  0

  2

  Doncaster

  0

  0

  0

  0

  0

  0

  2

  0

  Rotherham

  0

  0

  0

  0

  0

  1

  0

  1

  Sheffield

  9

  4

  14

  6

  2

  0

  6

  0

  Bradford

  0

  2

  14

  34

  15

  3

  14

  28

  Calderdale

  12

  8

  11

  3

  4

  1

  3

  0

  Kirklees

  1

  1

  0

  6

  2

  1

  0

  3

  Leeds

  1

  9

  16

  9

  6

  1

  8

  10

  Wakefield

  0

  0

  0

  0

  0

  0

  1

  1

  former Derbyshire

  22

  10

  —

  —

  —

  —

  —

  —

  Derby

  —

  —

  6

  4

  13

  6

  8

  11

  Derbyshire

  —

  —

  25

  13

  11

  13

  25

  11

  former Leicestershire

  21

  11

  —

  —

  —

  —

  —

  —

  Leicester

  —

  —

  2

  9

  5

  8

  11

  9

  Leicestershire

  —

  —

  5

  7

  8

  3

  7

  6

  Rutland

  —

  —

  1

  I

  0

  1

  2

  0

  552W
  Ms Estelle Morris
  [holding answer 23 June 2000]: The following table shows the number of full-time teacher vacancies in maintained nursery and primary schools1 and maintained secondary schools, in England, January 1997 to 2000, by local authority2.

  1Teacher vacancies in nursery schools are not collected separately.

  2New unitary local authorities created by local government re-organisation are shown immediately following the reference to their former local authority.

  553W

  1997

  1998

  1999

  2000

  Nursery and Primary

  secondary

  Nursery and Primary

  secondary

  Nursery and Primary

  secondary

  Nursery and Primary

  secondary

  former Nottinghamshire

  0

  0

  0

  0

  —

  —

  —

  —

  Nottingham

  —

  —

  —

  —

  0

  0

  18

  6

  Nottinghamshire

  —

  —

  —

  —

  0

  0

  0

  0

  Lincolnshire

  20

  12

  37

  21

  11

  11

  11

  8

  Northamptonshire

  0

  1

  1

  2

  3

  3

  1

  9

  former Hereford and Worcester

  1

  3

  1

  6

  —

  —

  —

  —

  Herefordshire

  —

  —

  —

  —

  2

  4

  8

  3

  Worcestershire

  —

  —

  —

  —

  6

  5

  3

  3

  former Staffordshire

  1

  25

  —

  —

  —

  —

  —

  —

  Stoke on Trent

  —

  —

  10

  8

  2

  1

  8

  14

  Staffordshire

  —

  —

  13

  8

  15

  6

  17

  10

  former Shropshire

  1

  2

  1

  0

  —

  —

  —

  —

  Telford and Wrekin

  —

  —

  —

  —

  0

  0

  7

  4

  Shropshire

  —

  —

  —

  —

  0

  1

  1

  1

  Warwickshire

  4

  6

  11

  1

  9

  5

  7

  6

  Birmingham

  9

  23

  7

  30

  59

  12

  39

  21

  Coventry

  4

  8

  4

  3

  2

  10

  8

  15

  Dudley

  7

  1

  5

  9

  2

  5

  7

  9

  Sandwell

  8

  12

  8

  7

  17

  11

  7

  8

  Solihull

  1

  2

  3

  4

  2

  0

  5

  6

  Walsall

  4

  4

  15

  21

  5

  7

  2

  6

  Wolverhampton

  5

  4

  2

  6

  14

  19

  5

  5

  former Bedfordshire

  26

  7

  —

  —

  —

  —

  —

  —

  Luton

  —

  —

  7

  16

  7

  17

  5

  9

  Bedfordshire

  —

  —

  11

  12

  5

  19

  20

  19

  former Cambridgeshire

  2

  4

  1

  6

  —

  —

  —

  —

  Peterborough

  —

  —

  —

  —

  0

  2

  0

  0

  Cambridgeshire

  —

  —

  —

  —

  1

  0

  0

  0

  former Essex

  45

  33

  56

  46

  —

  —

  —

  —

  Southend on Sea

  —

  —

  —

  —

  6

  3

  5

  16

  Thurrock

  —

  —

  —

  —

  48

  34

  19

  9

  Essex

  —

  —

  —

  —

  9

  12

  83

  73

  Hertfordshire

  21

  12

  31

  36

  12

  19

  10

  7

  Norfolk

  18

  12

  19

  11

  47

  10

  15

  15

  Suffolk

  15

  15

  8

  14

  14

  17

  8

  11

  Camden

  7

  9

  12

  2

  21

  8

  17

  13

  City of London

  1

  0

  0

  0

  1

  0

  0

  1

  Hackney

  23

  1

  51

  9

  38

  30

  47

  22

  Hammersmith and Fulham

  16

  8

  35

  12

  15

  8

  14

  8

  Haringey

  22

  20

  20

  10

  20

  13

  19

  14

  Islington

  3

  14

  27

  15

  10

  3

  20

  11

  Kensington and Chelsea

  0

  0

  17

  3

  3

  6

  3

  2

  Lambeth

  20

  4

  6

  6

  46

  12

  36

  12

  Lewisham

  16

  7

  31

  18

  21

  8

  18

  20

  Newham

  70

  29

  61

  21

  34

  3

  40

  14

  Southwark

  18

  6

  54

  6

  47

  14

  42

  30

  Tower Hamlets

  45

  12

  52

  13

  80

  12

  71

  26

  Wandsworth

  16

  13

  29

  5

  17

  12

  13

  10

  City of Westminster

  16

  2

  13

  4

  14

  11

  15

  14

  Barking and Dagenham

  27

  14

  10

  7

  12

  3

  8

  9

  Barnet

  9

  6

  8

  14

  11

  21

  29

  20

  Bexley

  1

  4

  1

  5

  0

  7

  13

  16

  Brent

  16

  10

  20

  8

  13

  17

  5

  5

  Bromley

  6

  5

  11

  4

  6

  7

  9

  3

  Croydon

  21

  2

  8

  5

  25

  11

  8

  28

  Ealing

  15

  8

  17

  30

  32

  22

  14

  14

  Enfield

  5

  4

  11

  6

  19

  9

  13

  15

  Greenwich

  5

  14

  31

  22

  52

  9

  16

  14

  Harrow

  4

  1

  9

  2

  12

  5

  24

  14

  Havering

  0

  9

  0

  15

  3

  10

  1

  17

  Hillingdon

  10

  9

  15

  13

  8

  19

  9

  14

  Hounslow

  7

  7

  8

  14

  5

  10

  3

  5

  Kingston upon Thames

  0

  3

  5

  1

  6

  3

  1

  7

  Merton

  5

  3

  7

  0

  5

  6

  3

  13

  Redbridge

  2

  2

  7

  10

  7

  7

  6

  1

  Richmond upon Thames

  3

  0

  2

  1

  2

  2

  3

  12

  Sutton

  3

  2

  4

  5

  2

  5

  0

  1

  Waltham Forest

  35

  6

  43

  4

  2

  5

  0

  4

  former Berkshire

  2

  3

  0

  5

  —

  —

  —

  —

  Bracknell Forest

  —

  —

  —

  —

  0

  0

  4

  5

  554W 555W

  1997

  1998

  1999

  2000

  Nursery and Primary

  Secondary

  Nursery and Primary

  Secondary

  Nursery and Primary

  Secondary

  Nursery and Primary

  Secondary

  Reading

  —

  —

  —

  —

  0

  2

  10

  4

  Slough

  —

  —

  —

  —

  8

  10

  3

  10

  West Berkshire

  —

  —

  —

  —

  2

  0

  4

  0

  Windsor and Maidenhead

  —

  —

  —

  —

  3

  6

  4

  5

  Wokingham

  —

  —

  —

  —

  9

  5

  5

  9

  former East Sussex

  18

  8

  —

  —

  —

  —

  —

  —

  Brighton and Hove

  —

  —

  8

  5

  2

  2

  5

  6

  East Sussex

  —

  —

  18

  11

  10

  12

  9

  14

  Isle of Wight

  0

  0

  0

  0

  0

  0

  0

  1

  former Kent

  67

  27

  55

  34

  —

  —

  —

  —

  Medway

  —

  —

  —

  —

  10

  6

  4

  9

  Kent

  —

  —

  —

  —

  52

  37

  32

  48

  former Buckinghamshire

  16

  18

  —

  —

  —

  —

  —

  —

  Milton Keynes

  —

  —

  5

  0

  8

  2

  6

  1

  Buckinghamshire

  —

  —

  10

  14

  18

  15

  36

  16

  former Hampshire

  43

  33

  —

  —

  —

  —

  —

  —

  Portsmouth

  —

  —

  8

  15

  10

  3

  6

  13

  Southampton

  —

  —

  6

  13

  6

  9

  8

  17

  Hampshire

  —

  —

  38

  19

  36

  57

  89

  53

  Oxfordshire

  1

  0

  4

  3

  7

  4

  4

  4

  Surrey

  18

  19

  27

  14

  11

  9

  13

  24

  West Sussex

  29

  8

  31

  8

  9

  8

  27

  11

  Bath and North East Somerset

  3

  0

  5

  0

  3

  1

  3

  1

  former Dorset

  4

  8

  —

  —

  —

  —

  —

  —

  Bournemouth

  —

  —

  0

  0

  0

  1

  0

  2

  Poole

  —

  —

  1

  2

  2

  3

  2

  0

  Dorset

  —

  —

  9

  7

  1

  1

  9

  10

  City of Bristol

  8

  6

  9

  5

  6

  6

  9

  4

  North Somerset

  7

  2

  5

  5

  3

  7

  8

  6

  former Devon

  12

  10

  15

  7

  —

  —

  —

  —

  Plymouth

  —

  —

  —

  —

  0

  5

  4

  19

  Torbay

  —

  —

  —

  —

  2

  1

  2

  5

  Devon

  —

  —

  —

  —

  6

  2

  18

  10

  South Gloucestershire

  8

  2

  3

  4

  3

  1

  2

  1

  former Wiltshire

  10

  9

  —

  —

  —

  —

  —

  —

  Swindon

  —

  —

  5

  2

  8

  2

  5

  5

  Wiltshire

  —

  —

  5

  13

  17

  4

  10

  4

  Cornwall

  6

  3

  6

  2

  6

  0

  8

  3

  Isles of Scilly

  0

  1

  0

  0

  0

  0

  0

  0

  Gloucestershire

  12

  2

  3

  5

  5

  4

  20

  5

  Somerset

  0

  0

  1

  3

  7

  4

  6

  4

  England

  1,088

  726

  1,391

  968

  1,376

  939

  1,420

  1,242

  The supply of teachers in Scotland is the responsibility of the Scottish Parliament, and in Wales, the responsibility of the National Assembly for Wales.

  Numeracy and Literacy Strategies (Hampstead and Highgate)
  Ms Glenda Jackson
  To ask the Secretary of State for Education and Employment if he will estimate the number of children(a) in the UK and (b) in Hampstead and Highgate who have benefited from current national numeracy and literacy strategies. [127852]

  Ms Estelle Morris
  Up to 4,000,000 pupils in England, and 4,600 pupils in Hampstead and Highgate, have benefited from the introduction of the National Literacy Strategy and National Numeracy Strategy in September 1998 and September 1999 respectively.

  Women
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment if he will make a556W
  statement on the findings of the consultation conducted by the Women's Unit in respect of stereotyping experienced by girls in subject and career choice counselling. [127248]

  Ms Jowell
  [holding answer 26 June 2000]: Young people were consulted about their job expectations and asked to examine the different expectations of boys and girls. Young women felt that despite their better performance than boys in school exams, the full range of career choices was not always presented to them. As a result we have developed a range of work experience programmes for girls with major companies and the Ministry of Defence to give girls an experience of different non-traditional work areas such as IT, engineering, construction, property and the armed forces.

  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment what plans have been made for the summit for Women in the New Economy. [127250]
  557W
  Ms Jowell
  [holding answer 26 June 2000]: The Government are planning to organise a two day event early next year that will focus on women in the UK maximising their potential in the labour market, whether it be starting a business, returning to work, considering a career change, or wishing to progress within their current organisation. Women from a range of backgrounds and locations will be given the opportunity to explore the choices available. The event will include exhibitors, (both public and private sector), workshops and seminars and women will be encouraged to participate in all of these.

  Highly Able Pupils
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment what steps he is taking to develop provision for highly able pupils in schools. [127253]

  Ms Estelle Morris
  [holding answer 27 June 2000]: From this September, the gifted and talented strand of Excellence in Cities will be improving provision in over 20 per cent. of maintained secondary schools, and a pilot scheme will be operating in some 400 primary schools. This summer's national programme of 500 summer schools for gifted and talented pupils aged 10–14 will extend to almost all local education authorities and Education Action Zones. Planned expenditure for this financial year is over £40 million. Future provision depends on the outcomes of the spending review.

  Education Funding
  Mr. Steen
  To ask the Secretary of State for Education and Employment how much money Devon LEA received from(a) his Department through the SSA, (b) New Deal for Schools and (c) public-private partnership schemes in the last twelve months. [128000]

  Ms Estelle Morris
  Devon's education SSA for 1999–2000 was £243.8 million, an increase of £15.9 million on the previous year. £7,416,360 was allocated to Devon LEA on 11 April 2000 through the New Deal for Schools programme. No allocations have been made to Devon in the last 12 months for public private partnerships.

  Learning and Skills Councils
  Mr. Jim Cunningham
  To ask the Secretary of State for Education and Employment if he will make a statement on the progress being made on the appointment of the chairmen of the Local Learning and Skills Councils. [128259]

  Mr. Wicks
  My right hon. Friend the Secretary of State has today appointed the chairs of 21 of the Local Learning and Skills Councils. They are:

  Local Learning and Skills Council

  Chair

  East of England

  Bedfordshire

  Jim McGivern

  Essex

  Mike Malone-Lee

  Cambridgeshire

  Sal Brinton

  Hertfordshire

  Stelio Stefanou

  Norfolk

  Geoff Loades

  Suffolk

  Tony Preston

  558W

  Local Learning and Skills Council

  Chair

  East Midlands

  Derbyshire

  john Kirkland

  Leicestershire

  Ashwin Mistry

  Lincolnshire

  Roger Begy

  Northamptonshire

  Christopher Ripper

  Nottinghamshire

  Duncan Sedgwick

  South East

  Surrey

  Robert Douglas

  Sussex

  Norman Boyland

  Oxford/Bucks/Milton Keynes

  Patrick Upson

  Kent/Medway

  Alan Chisholm

  Hampshire/Isle of Wight

  Penelope

  Melville-Brown

  Berkshire

  Tom Melvin

  North East

  Northumberland

  Barry Morgan

  Tyne and Wear

  Ashley Winter

  County Durham

  Olivia Grant

  Tees Valley

  Miles Middleton

  We will be announcing further appointments shortly and a list of the remaining appointments will be placed in the Library in due course.

  The local Chairs bring with them a wealth of experience, not least from business, which will be a positive force for success in shaping the work of the Local Learning and Skills Councils.

  School Milk (Northern Region)
  Mr. Etherington
  To ask the Secretary of State for Education and Employment if he will list the(a) infant, (b) junior and (c) primary schools in the Northern Region that are in receipt of the European subsidy for school milk; and if he will make a statement. [127009]

  Ms Quin
  I have been asked to reply.

  Of the 159 local education authorities which claim the EU School Milk Subsidy, 42 claim in the Northern Region on behalf of approximately 5,000 schools. The information requested on the breakdown between infant, junior and primary schools is not held centrally.

WALES

  Poverty
  Ms Julie Morgan
  To ask the Secretary of State for Wales if he will make a statement on progress in the Joint Ministerial Committee on tackling poverty. [126703]

  Mr. Paul Murphy
  The Joint Ministerial Committee on Poverty held its second meeting on 26 May. The Committee agreed that the Government and the devolved Administrations should participate in a joint programme to increase the take-up of the minimum income guarantee, as well as other benefits and services for pensioners.

  The Committee provides an excellent opportunity for the UK Government and the devolved Administrations to work together to tackle the problems of poverty and social exclusion. It enables us to ensure that we can share information and learn from each other's best practices.

  New Deal
  Mr. Brady
  To ask the Secretary of State for Wales if he will make a statement on the effectiveness of the New Deal for 18 to 24-year-olds in Wales. [126704]

  Mr. Hanson
  The New Deal has more than proved how successful it has been by achieving beyond its original target of 13,000 by employing 14,400 18 to 24-year-olds up to March 2000.

  Since the New Deal was launched throughout Wales, there has been a 62 per cent. fall in the number of 18 to 24-year-olds unemployed and claiming Job Seeker's Allowance for six months or more.

  Mr. Martyn Jones
  To ask the Secretary of State for Wales what discussions he has had with the Secretary of State for Education and Employment on the New Deal in Wales. [126717]

  Mr. Hanson
  Last month I attended a New Deal checkpoint meeting with other ministerial colleagues and colleagues from the devolved administrations, chaired by my right hon. Friend the Minister for Employment, Welfare to Work and Equal Opportunities. We welcomed the success to date of New Deal, which had succeeded in securing jobs for some 21,500 people in Wales by the end of March this year, and discussed ways of building on this success in the future.

  Mr. John Smith
  To ask the Secretary of State for Wales what discussions he has had with the Secretary of State for Education and Employment on the operation of the New Deal in Wales. [126707]

  Mr. Hanson
  Last month I attended a New Deal checkpoint meeting with other ministerial colleagues and colleagues from the devolved administrations, chaired by my right hon. Friend the Minister for Employment, Welfare to Work and Equal Opportunities.

  The Government's aim has always been to reconnect people with the labour market, so that they can play a full and productive part in society. At the end of March 2000 over 21,000 people had entered employment through the New Deal programme in Wales.

  Police Funding
  Mrs. Lawrence
  To ask the Secretary of State for Wales what recent discussions he has had with Welsh Chief Constables about the funding of police authorities in Wales. [126705]

  Mr. Paul Murphy
  I met the Chief Constables on 17 March. We discussed a wide range of issues including developments in modern policing, and staffing and funding levels.

  Joint Ministerial Committee on Health
  Mr. Edwards
  To ask the Secretary of State for Wales if he will make a statement on the Joint Ministerial Committee on Health which met on Friday 16 June. [126706]

  Mr. Paul Murphy
  The purpose of the Joint Ministerial Committee on Health was to provide an opportunity for all parts of the UK to share ideas and best practices.
  560W
  I know that everyone has found the exchange of experiences a useful tool for putting together plans for the future.

  Following the three meetings held so far I understand that Jane Hutt, the Assembly Health and Social Services Secretary will be making a statement to the National Assembly for Wales in July on progress in improving the NHS in Wales and her plans for further action.

  Cross-border Issues
  Mr. Stephen O'Brien
  To ask the Secretary of State for Wales what discussions he has had recently with the First Secretary on Welsh-English cross-border issues; and if he will make a statement. [126708]

  Mr. Paul Murphy
  I meet the First Secretary regularly to discuss a range of issues including this one.

  Where decisions affect communities on the English/ Welsh border, the Assembly engages in discussions with the lead Whitehall department. I would become involved only if I were asked to intervene to help resolve a difficulty.

  Sheepmeat Premium
  Mr. Llwyd
  To ask the Secretary of State for Wales what discussions he has held with the Agriculture and Rural Development Secretary of the National Assembly for Wales regarding the sheepmeat premium. [126709]

  Mr. Paul Murphy
  I discuss a wide range of topics with my colleagues in the National Assembly for Wales on a regular basis and my hon. Friend the Under-Secretary meets the Assembly Secretary for Agriculture and Rural Development every quarter. The UK Agriculture Ministers have been in discussion to agree a UK position on the anticipated Commission proposals for reform of the sheepmeat regime, expected in the autumn. The Assembly Agriculture and Rural Development Secretary is responsible for these matters in Wales, but my office is being kept fully informed of progress.

  Hunting with Hounds
  Miss McIntosh
  To ask the Secretary of State for Wales what assessment he has made of the impact of a ban on hunting with hounds on(a) the Welsh countryside and (b) employment, tourism and economic development in Wales. [126710]

  Mr. Paul Murphy
  I have made no specific assessment of the impact of a ban on hunting with hounds. However I am following this issue very closely as the potential repercussions on the Welsh countryside and employment, tourism and economic development in Wales are of course of great importance to me. The decision on the merits of hunting is a matter for Parliament and a free vote. It is a matter for each Member of Parliament to reach their own conclusion in the light of information which the Burns Report has added to the debate.

  Mr. Simon Hughes
  To ask the Secretary of State for Wales what discussions he has had this year about further transfer of powers to the Welsh Assembly relating to hunting. [126714]
  561W
  Mr. Paul Murphy
  I regularly discuss a wide range of topics with my colleagues both in Whitehall and the National Assembly for Wales. It is anticipated that a Government Bill containing a series of legislative options will be introduced early in the next Parliamentary Session. As my right hon. Friend the Home Secretary stated in the House on 12 June 2000,Official Report, columns 639–41 Wales and England are one common-law jurisdiction and as such the issue is not the responsibility of the National Assembly for Wales. We have no plans for a transfer of functions to the Assembly in relation to hunting.

  Mr. Caton
  To ask the Secretary of State for Wales what recent representations he has received about banning the hunting of foxes with dogs. [126722]

  Mr. Paul Murphy
  I have received no specific representations about banning the hunting of foxes with dogs, but am in close contact with colleagues in Whitehall as Government policy on this issue progresses.

  Unemployment
  Mr. Jon Owen Jones
  To ask the Secretary of State for Wales what discussions he has had with the First Secretary about the number of unemployed people in Wales in May 1997 and May 2000. [126711]

  Mr. Hanson
  My right hon. Friend regularly meets the First Secretary and discusses a wide range of issues including employment in Wales. In addition, I hold quarterly liaison meetings with the Assembly Secretary for Education and Training.

  This Government's record of continuing commitment to getting people off benefits and back into work is highlighted by the fact that the number of claimants on Jobseeker's Allowance for April 2000 has been significantly reduced to 59,170 compared to 80,322 for May 1997 when this Government took office.

  Mr. Bercow
  To ask the Secretary of State for Wales if he will make a statement on assistance for long-term unemployed people over the age of 25 years. [126715]

  Mr. Paul Murphy
  The New Deal programmes, Work Based Learning for Adults, "Employment Zones", and a range of Employment Service programmes provide training to equip workless people aged 25 and over with the skills they need to gain and hold down a job. The latest statistical information on the "New Deal for 25 Plus" indicates that, in Wales, 13,200 people had joined the programme, and 2,700 had entered employment (of which 2,300 had secured sustained jobs).

  Some improvements, including the introduction of a New Deal Gateway and access to a range of external Gateway services, were put in place on the "New Deal for 25 Plus" in April. A more comprehensive package of measures will operate from April 2001, with the aim of broadening the attractiveness of the programme to clients by providing a wider range of opportunities.

  Hospital Waiting Lists
  Mr. Clifton-Brown
  To ask the Secretary of State for Wales what recent discussions he has had with the First Secretary on the impact of funding on the change in NHS waiting lists in Wales for those waiting over six months since 1 May 1997. [126712]
  562W
  Mr. Hanson
  My right hon. Friend the Secretary of State and I regularly meet the First Secretary and the Assembly Health and Social Services Secretary to discuss the wide range of health issues affecting Wales.

  The subject of waiting lists and the impact on them of additional funding allocated by the Assembly is, of course, an important part of these discussions.

  Severn Bridge
  Mr. Loughton
  To ask the Secretary of State for Wales what discussion he has had with the First Secretary on charging VAT on crossing the Severn bridge. [126713]

  Mr. Paul Murphy
  I have regular discussion with the First Secretary on a wide range of transport issues and I recognise the significance of this issue to Wales.

  The issue of whether to charge VAT on toll charges is presently the subject of proceedings before the European Court of Justice. We understand that the judgment of the court is not due until 12 September.

  The Severn Crossings, which are mainly in England, remain the responsibility of the Department of the Environment, Transport and the Regions.

  Assisted Areas
  Mr. Wigley
  To ask the Secretary of State for Wales what discussions he has had with the First Secretary of the National Assembly and with officials of the EU Commission on the introduction of the new regional development maps for Wales. [126716]

  Mr. Paul Murphy
  The Assisted Areas map is a matter for the UK Government, but I have, of course, discussed the designation of Welsh areas with the First Secretary and the UK Government maintain close contact with both the European Commission and the National Assembly for Wales on this issue.

  The Government are still in discussion with the European Commission and are pressing for early approval of the Assisted Areas map. Within the framework set by the European Commission, all concerned have tried to include, so far as possible, revised proposals reflecting local and national priorities. The Government will make an announcement when the map is approved.

  NHS (Private Capital)
  Mr. Hammond
  To ask the Secretary of State for Wales what discussions he has had with the First Secretary and the Welsh Health and Social Services Secretary with regard to the use of private capital in the running of the NHS. [126718]

  Mr. Hanson
  My right hon. Friend, the Secretary of State and I have regular discussions with the First Secretary and the Assembly Health and Social Services Secretary about the wide range of issues that affect the NHS in Wales.

  It is encouraging to see the range of schemes that are being provided under the Private Finance Initiative.

  Local Government
  Mr. Öpik
  To ask the Secretary of State for Wales what assessment he has made of the consequences arising
  563W
  from the proposed Cabinet structure for local government for those councils which consist mainly of independent councillors. [126719]

  Mr. Hanson
  I have discussed the proposals with Welsh local councils individually and with the WLGA. The majority of Welsh councils—including some of those consisting mainly of independents—are currently piloting some form of executive style decision making. We have made no general assessment of pilots individual councils are currently pursuing, however these innovations are being carried out under the existing legislative framework which is not designed for executive arrangements.

  The Local Government Bill [Lords] provides a tailor made framework for executive arrangements including cabinets and directly elected mayors. The National Assembly for Wales will have the power to make further forms of executive available to Welsh councils if appropriate.

  Knowledge Economy
  Mrs. Betty Williams
  To ask the Secretary of State for Wales if he will make a statement on progress in the Joint Ministerial Committee on developing the knowledge economy. [126720]

  Mr. Paul Murphy
  The subjects covered by the Joint Ministerial Committee on the Knowledge Economy includes both responsibilities which have been transferred to the Assembly and some which have not. The Committee provides a forum for the UK Government and the devolved administrations to exchange information and best practice.

  The Committee's remit includes consideration of the level and availability of Information Technology training in the UK; the uptake by business of E-Commerce processes; and liaison between the administrations on electronic procurement. The Committee's remit also covers the employment opportunities created by the knowledge economy.

  Transport Links
  Mr. Ian Bruce
  To ask the Secretary of State for Wales what discussions he has had with the First Secretary on improving transport links between Wales and continental Europe. [126721]

  Mr. Paul Murphy
  I meet the First Secretary regularly and discuss a wide range of transport issues. The Assembly, who have responsibility for the majority of transport policy in Wales, continue to consider transport links to continental Europe when formulating their policies.

  Parliamentary Questions
  Mr. Maclennan
  To ask the Secretary of State for Wales how many of the written parliamentary questions tabled to his Department between 19 October 1999 and 20 April have not received substantive answers, citing as the reason that the information is(a) not held centrally, (b) not held in the form requested and (c) not available. [128012]

  Mr. Paul Murphy
  The information requested is as follows:(a) three, (b) nil and (c) two.
  564W
  In some of these answers we provided part of the information requested, while citing the above reasons for not providing all of the information requested.

  Electoral System
  Mr. Flynn
  To ask the Secretary of State for Wales what recent discussions he has had with the First Secretary about the working of the Government of Wales Act 1998 and the electoral system. [126700]

  Mr. Paul Murphy
  I meet the First Secretary regularly to discuss a range of issues.

CABINET OFFICE

  Interactive Voice Response Systems
  Mr. Ben Chapman
  To ask the Minister for the Cabinet Office how many Government Departments and agencies use interactive voice response systems to deal with inquiries from the general public departments. [127116]

  Miss Melanie Johnson
  I have been asked to reply.

  This matter comes under the responsibility of the Office of Government Commerce, which has been a Treasury Department since April 2000. Each Government Department is responsible for deciding the most appropriate telecommunications systems to meet its business requirements. Obtaining records from each of these on any use of interactive voice response systems to deal with public inquiries would be disproportionately costly.

  Statistics
  Mr. Simon Hughes
  To ask the Minister for the Cabinet Office what statistics relating to the responsibilities of her Department are collated by parliamentary constituency, indicating the dates covered in each case. [123848]

  Mr. Stringer
  My Department does not routinely collate any statistical data at parliamentary constituency level.

  The Cabinet Office does, however, compile statistics in response to specific inquiries from hon. and right hon. Members at constituency level.

  Parliamentary Questions
  Mr. Maclennan
  To ask the Minister for the Cabinet Office for how many parliamentary questions tabled between 19 October 1999 and 20 April 2000 her Department has given advice on answers; how many of these questions were instances of the same question being tabled to different Departments by the same hon. Members; and how many such questions there were. [127105]

  Marjorie Mowlam
  Detailed information in the form requested is not held centrally. My Department issues advice to Departments on a range of issues including Parliamentary Questions where appropriate. This is the practice adopted over many years by successive Administrations.
  565W
  Mr. Maclennan
  To ask the Minister for the Cabinet Office how many parliamentary questions were tabled to her Department between 19 October 1999 and 20 April which requested information, pursuant to her previous answers. [128008]

  Mr. Stringer
  Between 19 October 1999 and 20 April 2000 there were 18 parliamentary questions tabled to my Department which requested information pursuant to previous answers.

LORD CHANCELLOR'S DEPARTMENT

  Judicial Appointments
  Mr. Dismore
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will place in the Library a copy of the report into QC and judicial appointments by Dr. Kate Malleson. [127727]

  Jane Kennedy
  Dr. Kate Malleson and Dr. Fareda Banda recently completed research into the factors that affect decisions to apply for judicial appointments and Queen's Counsel. A copy of their report has been placed in the Library.

  Mr. Dismore
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will make a statement on the findings of the independent report commissioned by his Department from Dr. Kate Malleson into the system of appointment of QCs and judges. [127726]

  Jane Kennedy
  In December 1998, the Lord Chancellor's Department commissioned research into the factors that affect decisions to apply for judicial appointment and Queen's Counsel. Dr. Kate Malleson and Dr. Fareda Banda undertook the research and their report 566W
  was published on 15 June 2000. The research found that there is a wide range of factors that affect decisions to apply for judicial appointment and/or Queen's Counsel. Some respondents did not have a judicial appointment in their career plan, while others were concerned about the consultation procedures for assessing candidates for judicial office; concerns based on largely inaccurate perceptions of how the system actually works. The report made no findings into the system of appointment of QCs and judges.

  Conveyancing
  Mr. Blizzard
  To ask the Parliamentary Secretary, Lord Chancellor's Department if he will make a statement on progress with the trials of the new system for home buying and selling. [127700]

  Mr. Lock
  The seller's information pack pilot project under way in Bristol is now two thirds complete. Citizens' workshops to test how packs might operate in relation to lower value properties have been undertaken in Burnley and Bradford. A summary of the interim research findings was published on 27 June and copies have been placed in the House of Commons Library. A final research report is expected to be published later in the year.

  Family Law
  Mr. Leslie
  To ask the Parliamentary Secretary, Lord Chancellor's Department when the Lord Chancellor's Advisory Board on Family law plans to publish its Third Annual report. [128442]

  Jane Kennedy
  The Lord Chancellor's Advisory Board on Family Law has today published its Third Annual Report and copies have been placed in the Libraries of both Houses.

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

Lord Hodgson of Astley Abbotts
Lord Hodgson of Astley Abbotts, Esquire, CBE, having been created Baron Hodgson of Astley Abbotts, of Nash in the County of Shropshire, for life—Was, in his robes, introduced between the Lord Lane of Horsell and the Baroness Seccombe.

Language Teaching
2.42 p.m.
Lord Watson of Richmond Lord Watson of Richmond asked Her Majesty's Government:
Whether they accept the recommendation of the Nuffield Languages Inquiry that languages should have the same status as literacy, numeracy and information communication technology as a key skill and whether they will consequently make a commitment to early language training for all children.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, the Government will respond fully to the Nuffield report in due course. Already we are piloting approaches to language teaching in primary schools and we have asked the Qualifications and Curriculum Authority (QCA) to consider the potential to extend that in the longer term.
Lord Watson of Richmond: My Lords, I am grateful to the Minister for that Answer, but it stops short of the commitment for which the Nuffield inquiry makes such a powerful case. Is Her Majesty's Government aware that, by not making that commitment, they will seriously disadvantage Britain's competitiveness in the future in a multi-lingual world and that they will disadvantage pupils in state schools as opposed to those in private schools? I presume that that is not their intention. It is much easier to learn languages when one is young, so why not allow everyone that opportunity?
Baroness Blackstone: My Lords, I accept that there is much to be said for starting to learn languages at an early age. I believe that the noble Lord, Lord Watson of Richmond, is jumping the gun in saying that the Government are making no commitments in this area. The Government are considering the recommendations of the Nuffield inquiry. As I said, the Government will reply to all the recommendations
892
in due course. Meanwhile, a growing number of primary schools—between 25 and 30 per cent—are able to offer a modern language as an option. That may not satisfy the noble Lord, but it is an improvement on the situation in the past. The QCA is looking at the matter and, when it has reported, I shall let the noble Lord know the outcome.
Lord Quirk: My Lords, does the Minister agree that the build-up over the past four or five years of specialist language colleges has been an outstanding success? They now total almost 100. Have they not shown that in this country we can have a good take-up for languages, enthusiastic learning and a good language spread, including languages beyond French to German, Italian, Spanish and other languages? Would it not be timely to take up the Nuffield recommendation and match secondary schools with specialist primary schools so that parents with a serious commitment to wanting their children to learn foreign languages can be confident that there will be a smooth and progressive transition to the secondary level in a way that was denied during earlier initiatives of this kind?
Baroness Blackstone: My Lords, I agree with what the noble Lord, Lord Quirk, has said about the success of specialist language schools so far. Across the country they teach some 20 languages, thus allowing greater choice. They also allow languages such as Japanese and Mandarin to be taught in our secondary schools. I accept what he says about the need for a smoother transition for those primary school children who have had the chance to learn a modern language so that they can take forward what they have learned into their secondary schools. His suggestion that specialist schools should work with the primary schools in their areas to achieve that smooth progression is one that is being examined. I hope that it will be taken forward.
Lord Jenkin of Roding: My Lords, the Nuffield report is splendid and the authors are to be congratulated. However, the shortage of language teachers is most worrying. The report states:
"The shortage of teachers, which is now acute and damaging the quality of provision in schools and colleges, is creating a vicious circle of inadequate supply".
In those circumstances, is it not absurd that university departments that train teachers of modern languages are threatened with closure?
Baroness Blackstone: My Lords, there has been a long-term problem in relation to the recruiting of modern language teachers, as there certainly was during the period when the noble Lord, Lord Jenkin of Roding, was himself a Cabinet Minister. The Government are attempting to address this difficult area. We are providing PGCE students, who are trained to be modern language teachers, with a £6,000 quasi salary. We hope that that will encourage more young people with language degrees to enter teaching, because at present many do not. We are also providing

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an extra £4,000 to teachers of shortage subjects, after their induction period, when they first start teaching. In relation to maths and science teachers, that has been very successful and we hope that there will be similar success as regards language teachers.
I do not know to what the noble Lord refers when he says that departments that train teachers in modern languages are being closed. There has been some reduction in the number of students taking a modern language as a single-subject honours degree, but there has been a big increase in the number of students who combine a modern language with another subject.
Baroness David: My Lords, is it not a fact that many students can now start a language when they reach university? I totally appreciate the advantage of starting to learn a language when one is young. However, there is now the opportunity at university to start a degree from scratch in a language such as Russian, to graduate and hopefully to take up the teaching of it afterwards.
Baroness Blackstone: My Lords, my noble friend is absolutely right. There is now a much more imaginative approach in higher education to the teaching of modern languages which allows students who have some potential in this area to start a language from scratch. Through intensive training—often a four-year course with one year spent abroad—students can reach good degree-level standards in that subject, and that is to be encouraged.
Lord Geddes: My Lords, does the Minister agree that there is another side to this very valuable coin? I refer to the encouragement of the teaching of English to the speakers of other languages.
Baroness Blackstone: My Lords, I entirely agree that encouraging people to learn English is another side of this coin and one from which British exporters can certainly benefit.
Lord Wallace of Saltaire: My Lords, is the Minister aware that the French and German Governments are discussing closer bilateral co-operation in teaching each other's languages? Now that Britain is at the heart of Europe, according to the Prime Minister, have the British Government considered making bilateral arrangements with the Spanish, French and German Governments? We used to have good foreign language assistants in British schools in much larger numbers. If such a scheme could be expanded again, it would help primary and secondary schools considerably.
Baroness Blackstone: My Lords, discussions of a bilateral nature are taking place with the governments of those countries to extend provision of that kind. I am afraid that demand from those countries for students from the UK to work as language teaching assistants is bigger than the demand in the opposite direction.

World Water Forum
2.51 p.m.
Lord Bradshaw Lord Bradshaw asked Her Majesty's Government:
What steps they are taking to co-ordinate United Kingdom interests at the third World Water Forum to be held in Japan in 2003.
Baroness Amos: My Lords, the United Kingdom's interests for the second World Water Forum were coordinated through a cross-departmental group comprising the Department for International Development, the Foreign and Commonwealth Office and the Department for the Environment, Transport and the Regions. The Secretary of State for International Development led the delegation, which included representation from the private sector, civil society and professional associations. We plan to consult widely on co-ordination of United Kingdom interests for the 2003 forum.
Lord Bradshaw: My Lords, I thank the noble Baroness for that reply, though it falls a long way short of what is needed. I hope she will agree that water is an exceptionally important industry throughout the world. At the World Water Forum, which took place in the Hague with 4,500 delegates, the British participants found each other by looking through the list of attendees. The French, German and Japanese delegations were all properly co-ordinated. Can the Minister assure us that we will immediately look for a lead agency in government to take this matter in hand so that British industry is properly represented at the Water Forum in 2003?
Baroness Amos: My Lords, as I made clear in my original Answer, we take co-ordination extremely seriously. We want to ensure that industry, civil society, the professional associations and government departments are represented on our delegation. At the Hague conference we wanted to ensure that the poverty and development focus was clear in terms of what was discussed at that forum. I agree that water is exceptionally important. We take our responsibilities in that area extremely seriously and will be coordinating at an early stage to get the best out of the 2003 forum.
The Earl of Selborne: My Lords, as one of the 4,500 delegates at the World Water Forum in the Hague, can I make a plea that when arrangements are being made for the third Water Forum, that the Office of Science and Technology be included among the departments so that British science, technology and engineering can be adequately represented?
Baroness Amos: My Lords, I take the noble Lord's point. As I said in my original Answer, a cross-departmental working group attended the last forum. The actual delegation comprised the Department for International Development, the FCO and the Department for the Environment, Transport and the

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Regions, but other departments were consulted before we went to the forum. I entirely agree that we need to ensure that science has a clear role in our preparations for 2003.
Baroness Whitaker: My Lords, given that 40 per cent of the population do not have access to adequate sanitation, can my noble friend say what the Government are doing to address that aspect of the water problem?
Baroness Amos: My Lords, we have made some progress in relation to access to safe water in that the numbers of people throughout the world who do not have such access has gone down to 1 billion. As my noble friend said, some 2.4 billion people—40 per cent of the world's population—do not have access to adequate sanitation. The Department for International Development is investing £50 million into a combination of water and sanitation projects. That figure will be increased to around £360 million in the coming years.
Lord Ezra: My Lords, is it not unfortunate that, following the conference in March of this year referred to by my noble friend Lord Bradshaw, the non-governmental organisations jointly issued a statement totally disagreeing with the ministerial statement? Does not that underline my noble friend's point that there should be proper co-ordination? Cannot the UK lead the way by bringing NGOs as well as other bodies into their co-ordination plans in readiness not only for the next world forum in 2003, but also for the next water conference in Germany in 2002?
Baroness Amos: My Lords, noble Lords will be aware that working in partnership not only with the NGOs but with business, with governments and with international financial institutions is a key part of the strategy of the Department for International Development. We worked closely with NGOs in preparing for the water forum. However, we live in a democracy and it is important that, where NGOs disagree with government, they have the right to say so. We have consultations with NGOs and others who are involved with development through our policy forums. That is to ensure that NGOs understand our agenda and, as far as possible, we understand theirs. It does not mean that the agendas will always be the same.
Lord Grenfell: My Lords, given that an important and early beneficiary of public sector investments in water supply in developing countries is often the private sector, particularly the multinationals, does the Minister agree that the Government should place special emphasis in the forum on encouraging more private sector investment in water supply in developing countries, possibly through public-private partnerships?
Baroness Amos: My Lords, that is an approach which the department has taken extremely seriously.
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We recognise the significant potential contribution of public-private partnerships to improve access to sustainable water and sanitation services for poor people. In fact, we have worked with other governments to access the potential contribution of the private sector. We have also worked with the World Bank and the government of Japan, and launched a public-private infrastructure advisory facility to assist developing countries to establish appropriate enabling environments for partnerships with the private sector.

Peruvian Elections and Democracy
2.58 p.m.
Lord Avebury Lord Avebury asked Her Majesty's Government:
Whether they intend to review the Anglo-Peruvian agreement made in July 1998 between the Prime Minister and President Fujimori, in the light of the Peruvian presidential election.
Baroness Ramsay of Cartvale: My Lords, the Anglo-Peruvian agreement signed in July 1998 is reviewed on an annual basis. We are deeply concerned at the conduct of the recent presidential elections, which fell far short of internationally accepted standards. We shall discuss our reaction with our European partners when we meet after the Organisation of American States' investigative mission returns from Peru at the end of June.
Lord Avebury: My Lords, as well as the preliminary report of the OAS, were not reports by the EU delegation which attended the first round of the presidential elections, by FIDH, and by Electoral Reform Services and so forth uniformly critical? Does the noble Baroness agree that it is impossible to have an agreement which calls for collaboration in promoting democracy if there is no democracy to promote? Will she ensure that, in the current considerations of our relationship with Peru, Sr. Toledo, the leader of the opposition, is consulted? Does she know whether he had anything to say during his recent visit to Spain about what the EU can do to help?
Baroness Ramsay of Cartvale: My Lords, we played a key role in the EU in drawing attention to the inadequacies of the system and calling for free and fair elections in Peru. The noble Lord will be well aware that there was a British delegation observing the first round of presidential elections, which consisted of my right honourable friend Mr Tom Clarke and the honourable Member, Mr William Ross. They reported extremely critically on the proceedings during the first round.
We support the OAS mission that is visiting Peru at present. It is a very high level delegation, led by the OAS general-secretary Cesar Gaviria and the chair of the Organisation of American States General Assembly, Mr Lloyd Axworthy, who is also the

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Canadian Foreign Minister. We shall discuss reaction with our EU partners in the light of that mission's recommendations on its return. We wish to ensure that whatever action we take will help to protect the democratic rights of the Peruvian people.
Baroness Hooper: My Lords, does the noble Baroness agree that, while awaiting the outcome of these reports, the best way to help the people of Peru and to reinforce the democratic principle is to maintain contact and co-operation at all levels as well as insisting on the utmost openness and transparency in all processes and procedures whether they be political, social or commercial? In view of the many efforts by chambers of commerce, trade organisations and my own organisation, the Hispanic and Luso Brazilian Council of Canning House, to improve and increase trade and investment in Peru, can the noble Baroness reassure the House that the Government, especially the new British Trade International, will continue to support these efforts?
Baroness Ramsay of Cartvale: My Lords, the whole House knows of the expertise of the noble Baroness, Lady Hooper, in affairs of Latin America, especially in her role as president of Canning House. I can assure the noble Baroness and the House that our aim in whatever we do in Peru is to further bilateral relationships with NGOs and civil society in all its forms.
Lord Brennan: My Lords, I declare an interest as one of the patrons of the Peru Support Group. Is my noble friend aware of the particular concern of many people that a consequence of this election is a potential risk to the human rights situation in Peru? With that concern in mind, will she confirm two aspects of the Anglo-Peruvian agreement: first, that this Government will continue to give unremitting support to Dr Santistevan, properly called in Spanish, "the defender of the people of Peru"—in our language, the ombudsman; and, secondly, that they will continue to finance the tremendous initiative of the BBC, the British Council and the Institute of Defence Lawyers in Peru whereby human rights and civic education programmes are broadcast throughout the nation on over 70 different radio stations?
Baroness Ramsay of Cartvale: Yes, my Lords. I can assure my noble friend that the UK has already contributed a great deal to both those projects and that it will continue to do so. Since March 1998, this country has contributed more than £141,000 from the FCO's Human Rights Project Fund to assist the work of the Ad Hoc Commission on Human Rights and the Ombudsman's Office. The FCO's project fund has also provided £144,000 for a two-year project, which commenced in April 1999, supported by a Peruvian NGO and the British Council, to produce and broadcast twice-weekly radio programmes on human rights via the most popular radio station in Peru.
Baroness Gardner of Parkes: My Lords, is the Minister aware that not only did I visit Peru as a
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member of the Inter-Parliamentary Union delegation last year, but I also visited the country 10 years previously, just before President Fujimori came to power? It is amazing to see the remarkable change that has taken place in the country during that time. Is the Minister also aware that 10 years previously our NGO, Plan International, was forced to leave Peru because it was impossible for NGOs to work there to help alleviate poverty? Is the Minister further aware that a great deal has been done by the present administration to reduce poverty in the poorest parts of Peru?
Baroness Ramsay of Cartvale: Yes, my Lords. I am very well aware that, at the beginning of his period of office and in his first five-year term, President Fujimori had to deal with a country that had been greatly weakened by terrorism and bad government—a situation that he inherited. The noble Baroness is quite right in that respect. Great strides have since been made in the country. Unfortunately, the present problem is the validity and the correctness of the last election. The noble Baroness is absolutely right to say that Peru has made giant strides in all the fields that she mentioned.

Zimbabwe
3.5 p.m.
Lord Blaker Lord Blaker asked Her Majesty's Government:
What changes they propose in policy towards Zimbabwe in the light of the result of the election there.
Baroness Ramsay of Cartvale: My Lords, the House is well aware of the background against which parliamentary elections were held in Zimbabwe over the weekend. We admire the dignity and courage of the people of Zimbabwe in turning out to exercise their democratic rights in the face of violence and intimidation. The result is a clear message that the people want change. We hope that ZANU(PF) will respond positively to the offer from the opposition to discuss how they can work together for the people of Zimbabwe. If ZANU(PF) is willing to make a fresh start, Britain will be willing to respond.
Lord Blaker: My Lords, I am grateful to the noble Baroness for that statement, with which I believe all noble Lords will agree. Can she add praise to the congratulations that she expressed on the courage of the MDC in particular, 35 supporters of which were killed during the election campaign? Will she also congratulate the statesmanlike position taken by Mr Tsvangirai, the leader of the MDC?
In so far as action taken by other countries in this fraught and unstable situation can be helpful, does the noble Baroness agree that there is much to be said for action being taken internationally by the Commonwealth, the European Union and the United Nations rather than by the United Kingdom alone, which seems to provoke rather prickly reactions? I do

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not ask the noble Baroness to tell the House about the Government's plans, but can she assure us that they have plans in place?
Baroness Ramsay of Cartvale: Yes, my Lords. The noble Lord, Lord Blaker, is absolutely right. I believe we all agree that the way forward is through concerted international action. The fact that a Commonwealth mission and a European Union mission led the 400-strong team of international observers which played a role in helping through the process in Zimbabwe during the elections over the weekend has shown that this is the way forward. We are awaiting the final report from the EU mission, which was led by Pierre Schori, who has already appeared on the media and publicised an interim report. We are also waiting for the final report from the Commonwealth mission led by General Abubakar. They have both done a very good job. We await to hear the results and to see political developments in Zimbabwe. We are prepared to help in any process that will aid the economic, political and democratic future of Zimbabwe.
Lord Redesdale: My Lords, I too respect Mr Tsvangirai for the position he has taken and for the restraint he has shown in interviews after the election when tempers are high. However, does the Minister agree that economic crisis is looming in Zimbabwe? Although ZANU(PF) may have won the elections, change will almost certainly be brought about by the economic situation. I hope that the Minister will ensure that Britain takes a leading role in doing nothing to precipitate an economic crisis which would affect the people of Zimbabwe far more than the ruling party.
Baroness Ramsay of Cartvale: My Lords, we have kept in touch with Morgan Tsvangirai. As noble Lords are aware, the Movement for Democratic Change will contest the outcome of a number of seats, perhaps 22 of them. That may include the seat which Mr Tsvangirai failed to win. The noble Lord, Lord Redesdale, is right to mention the economic problems which face Zimbabwe. I refer to the following frightening statistics: 80 per cent inflation; 50 per cent unemployment; and interest rates of 70 per cent. It is absolutely vital that the economy of Zimbabwe is helped. It is also important that the new government of Zimbabwe, working with the Parliament, should not discourage any foreign investment on which Zimbabwe's prosperity depends.
Lord Clarke of Hampstead: My Lords—
Lord Howell of Guildford: My Lords—
The Attorney-General (Lord Williams of Mostyn): My Lords, it is the turn of the Conservative Front Bench.
Lord Howell of Guildford: My Lords, without pressing the noble Baroness on the detail, and recognising that these are early days, I ask her whether
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she recalls that the Foreign and Commonwealth Secretary said the other day that he would mount an international campaign to put pressure on President Mugabe to implement the will of the people. Can the noble Baroness give us an idea of his allies in that campaign, which seems to me to be utterly the right way forward? What rapid international action can we take to save the entire economy from sliding into the chaos which the noble Baroness has already indicated lies ahead? On a more specific point, can she say something about the British military advisers to the army of Zimbabwe, of which President Mugabe is the commander? Is it planned to leave them in place or to withdraw them?
Baroness Ramsay of Cartvale: My Lords, the noble Lord asks a series of questions. As I have already said, we shall work in conjunction with both our European Union partners and the Commonwealth. Both those organisations will have a great role to play to try to help Zimbabwe along the path that we would all like it to follow. Noble Lords will understand that I am trying to choose my words extremely carefully as we do not wish to sound too critical or to anticipate problems that we hope will not arise if things develop according to the comments in the televised statesmanlike public address that President Mugabe gave yesterday.
The noble Lord asked a specific question about the British military training team in Harare and the advisers. There are five military advisers providing peacekeeping training to the Southern African Development Community region. Three other advisers are involved in peacekeeping training in support of UN priorities. As the noble Lord knows, they are in Harare. The British military advisory training team is based there but it focuses on regional peacekeeping training within the whole development community. The courses are held across southern Africa and at the moment we have no specific plans to change things.

Business
Lord Carter: My Lords, at a convenient moment after 3.30 p.m. my noble friend Lord Sainsbury of Turville will, with the leave of the House, repeat a Statement which is being made in another place on the post office network.

Regulation of Investigatory Powers Bill
3.13 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Bassam of Brighton): 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 Bassam of Brighton.)
Lord Cope of Berkeley: My Lords, before we start the Committee proceedings, I wish to record that the

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Government have written to me and to other Members of your Lordships' House setting out a vast series of most important changes which rewrite important parts of the Bill. I am glad that the Government have recognised the need for this major rewrite. I am grateful to the noble Lord, Lord Bassam, and to the Chief Whip for their letters, which have been fairly widely distributed, although I do not think that they were placed in the Library.
Some of these important amendments concerning Part III appeared yesterday. We shall discuss them later today, although admittedly at short notice. However, other changes were promised at earlier stages of the Committee but we have not yet seen the actual amendments. It is clear that, for example, the definition of "communications data" and the matters which flow from it will be of the first importance, will be exceptionally complex and will have consequences in a number of clauses. They may well amount to a rewrite of that part of the Bill.
In those circumstances, we may seek the recommittal of that part of the Bill in accordance with the Companion to the Standing Orders, which suggests that procedure for amendments tabled at a late stage which require detailed examination. The Companion states:
"Decision on such amendments may then be reached on recommitment, reserving to the Report stage its proper function as an opportunity to review and perfect the bill as amended in Committee".
Obviously such a request would be considered by the usual channels. However, I thought that it might be useful to mention that possibility now.
Lord McNally: My Lords, further to that comment, perhaps the Chief Whip rather than the Minister should respond to those concerns. We are almost now dealing with a House of Lords Bill, so dramatically is the Bill being rewritten as we proceed. I repeat: if ever there was a case for pre-legislative scrutiny, this Bill is it. I hope that in future, when Bills of great technicality are brought before the House, outside expertise will be brought in at an early stage, rather than having to have that expertise brought to bear on the Home Office before concessions are made, as in this case.
I do not wish to appear churlish. Having pressed changes on the Home Office, we do not object to the fact that changes to the Bill are now being made. However, it is now extremely difficult, midway through the Committee stage, to make a judgment on the balance of the Bill. It would be helpful to know how the Report stage will be handled.
I address my next question to either the Minister or the Chief Whip: will we see the code of conduct before Report stage? The rewriting that has been promised as the Committee stage has proceeded and the code of conduct will give us a much more complete picture of the Bill.
To try to legislate both for civil liberties and for one of the most important new 21st century industries in the rather heated atmosphere of July, with all the
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pressures that that entails, and with a Bill which involves considerable secondary legislation and delegated powers, is not the way to do business. It is not just a case of the Opposition opposing this process; there are some sensible lessons to be learned with regard to how we have reached this position and how it should be avoided in the future.
Lord Bassam of Brighton: My Lords, I shall try to deal with the points in turn. I am a great fan of pre-legislative scrutiny. I take to heart the comments that have been made in that regard. It is an important and valid point. I thank both noble Lords who have spoken. However, I ask the rhetorical question: how would they have felt if we had not made any changes? We have moved a long way on the Bill. We said at the outset that we would do precisely that and that this was a listening and a consultative process. We said that we would take on board reasonable criticisms, as far as we could do so, and engage actively with industry interests.
What I can say to both noble Lords is that we are still committed to the timetable of producing by the Report stage the draft codes of practice. We want to be as helpful as we can be in enabling industry interests to have the maximum opportunity to look at those because clearly they have a bearing on future debates. I hope that that clarifies that point.
As to recommittal, that is a question to be considered in the usual way by the usual channels. I am grateful to noble Lords for their contributions. I think that that presages a helpful dialogue over the amendments we have tabled. We will try to give as much advance information on the precise nature of other amendments that are to be brought forward at the Report stage. But, as I have said, this is all about listening. We are trying to listen. We have taken on board many comments and criticisms. We want to improve the quality of this legislation, as we do with all other pieces of legislation.
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 25 [Conduct to which Part II applies]:
Lord Bach Lord Bach moved Amendment No. 99A:
Page 27, line 11, leave out ("For the purposes of this Part surveillance is directed") and insert ("Subject to subsection (5A), surveillance is directed for the purposes of this Part").
The noble Lord said: In moving Amendment No. 99A I should like to speak to government Amendments Nos. 102A, 110 and 137. There are other amendments in this group. If it is acceptable to the Committee I propose to listen to what is said when those amendments are moved, if they are moved, and then reply to them when I speak again.
We have listened closely to the representations that have been made in relation to Parts I and III of the Bill. The Committee will agree that we have tried to meet those concerns where possible and given clear reasons where we think amendments were not acceptable. I am therefore turning, with some relief, to Part II which is,

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we think, genuinely welcomed by everyone. These are important provisions which will safeguard the use of these valuable investigative techniques by law enforcement authorities, by the intelligence services and by many public authorities carrying out statutory enforcement functions.
As part of the development of policy, we have been able to identify all those public authorities currently using covert investigative techniques. The provisions of the Bill will introduce control and national standards for activity which is currently unregulated. They will also ensure that authorisations for action are given only on grounds compatible with the Human Rights Act. That activity is being authorised at the same level across Whitehall and other public sectors and there is effective and independent oversight of the use of these techniques.
After those few introductory words regarding Part II, perhaps I may turn to the government amendments. These amendments generally address a wide range of issues concerning the definitions of surveillance and covert sources. I have already mentioned that a beneficial side effect of this legislation has been to identify all those public authorities carrying out covert surveillance activities. We have tabled an amendment proposing that these authorities be identified in a schedule to the Bill. However, we are still becoming aware of activities on which the Bill will impact. One such activity is the use of covert surveillance by the BBC in order to detect licence evasion.
As currently drafted, it could be argued that this activity is intrusive surveillance. It is covert surveillance involving primarily residential premises, and equipment is deployed outside the premises which produces a picture of the same quality and detail as might be expected to be obtained from a device inside the premises. However, it cannot be said that such activity infringes on a person's privacy in the same way as a bugging device or hidden camera impinges on their privacy. It would not, for example, provide details of that individual's private or family life, except perhaps for his taste in television programmes. All that it would provide would be details of the television programme being watched by a person, the same as is being broadcast into millions of other homes.
We have therefore decided to exclude this specific activity from the definitions of intrusive and directed surveillance. However, this does not mean to say that we do not believe this activity does not constitute some invasion of privacy or that it should not be put on a statutory basis.
The provisions in Clause 44 of the Bill allow the Secretary of State, by order, to add to the types of covert surveillance identified in the Bill. The issue of TV licence evasion detecting equipment is a candidate for an order under this clause. This activity is a rather distinctive type of surveillance that does not fit easily with the existing provisions in Part II of the Bill.
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Bringing forward an order specifying it as a new type of surveillance would be a way of making it subject to statutory controls. I beg to move.
The Chairman of Committees (Lord Boston of Faversham): As Amendment No. 103 is grouped with this amendment, I must point out to the Committee that if that amendment is agreed to I cannot call Amendments Nos. 104 to 106.
Lord Cope of Berkeley: We have two amendments in this group. Perhaps I may say to the Minister that the government amendment brought forward in response to consultation and pressure could almost he covered by the phrase "minor and technical amendments", a phrase used by Mr Charles Clarke about the Bill when it left the Commons. When asked what amendments he expected would be made in the House of Lords he said that some minor and technical amendments might be made. As I say, I think that this amendment just about comes under that description. However, many of the amendments which we shall discuss later do riot. As I said a few moments ago, I am glad about the recognition of a need for a rewrite and for that matter the recognition by noble Lords of the, importance of the Bill.
Our Amendment No. 102 is grouped with Amendment No. 99A. The amendment draws attention to Clause 25(2)(b), which states:
"For the purposes of this Part surveillance is directed … in such a manner as is likely to result in the obtaining of private information about a person (whether or not one specifically identified for the purposes of the investigation or operation)".
We recognise that in picking up private information about one individual who is the suspect—let us call him the probable criminal—other information about those adjacent to him, in his family or whatever, is likely to be collected at the same time, even if it is not directly relevant to the operation being conducted. But that information is not really the information which those carrying out the surveillance should be going for. I think that we should consider that. Furthermore, the clause appears to permit fishing expeditions against people who are not suspected of any crime, terrorism and so on. Therefore, I thought it worth probing what exactly is intended by the words in the amendment.
The Minister mentioned the BBC in connection with licence evasion. We have read in the Sunday Telegraph about how the BBC was involved in covert and intrusive surveillance of a residential home, which led to a programme which has been severely criticised not only by the Sunday Telegraph but also by the police. I do not want to become involved in the rights and wrongs of the actual programme concerned, but it is clear that this was covert, intrusive surveillance by the BBC. There were concealed cameras in residential premises for the exact purpose of filming people within that home. That practice, of course, is by no means unique.
If the Bill is passed in its present form, it would be helpful if we could be told about the future legal position in connection with covert intrusive surveillance for the purposes of collecting private

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information by the BBC or any other news media. However, the main purpose of my remarks is to illustrate the reason why we have tabled Amendment No. 102.
I have also tabled Amendment No. 112A, which has been included in this grouping. At Clause 25(7) the Bill sets out provisions covering a "covert human intelligence source"—more usually known as a "grass". The clause defines such a person and provides for how such a relationship is to be governed. All that is fine. However, my amendment draws attention to the kind of circumstance where someone discloses information that he has obtained in a similar fashion, but has done so,
"to avoid the commission of a criminal offence by another person under any other enactment".
We are not discussing a person established as a grass by the police, but rather a person who decides to grass on someone else in order to avoid the commission of an offence. The amendment seeks to explore the exact position of such a person. Clearly, these people can be of great value to the police and no one would wish to discourage them or place legal impediments in their way. I hope that the Bill does not do that, but I thought it best to inquire about the effects of the Bill while we are debating it in Committee.
3.30 p.m.
Lord McNally: Following on a point made by the noble Lord, Lord Cope, in the past I have worked, in a purely voluntary capacity, with the Alliance Against Counterfeiting and Copyright Theft, a body of commercial organisations that uses various surveillance techniques to track down those involved in offences of counterfeiting and breach of copyright on CDs and so forth. That body is concerned that it might be caught within the ambit of the Bill. It may be that the Minister has a ready response on this point. If not, the issue may need to be brought back on Report in the form of a probing amendment.
Rather like the example given by the Minister of the television detector van, concern has been growing that other activities that were previously thought of as proper and legitimate might now be "hoovered up" by the powers contained in the Bill.
Lord Phillips of Sudbury: On behalf of my colleagues on these Benches, I shall speak to an inordinately long list of amendments contained in this grouping: Amendments Nos. 100, 101, 103, 104, 107, 108, 111, 112, 116, 119 and 138. That constitutes a Herculean, if not an impossible, task. Difficult though the job of organising amendments can be, I wonder why so many amendments have been strung together into one grouping. They cover a wide variety of highly important issues.
The broad intention behind the first two-thirds of these amendments is to ensure a higher level of distinction between, and a greater level of protection against, certain kinds of surveillance. Under the Bill, "directed" surveillance and the use of what are termed
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"covert intelligence sources" require the lesser control of self-authorisation from a designated person within the agency undertaking the action. "Intrusive" surveillance, which is defined in Clause 25, requires approval from a High Court judge acting as a commissioner.
I do not expect noble Lords have been able to study all the amendments in detail. It would weary the Committee were I to plod through them one by one, especially since we face a long day ahead. However, the general endeavour is, first, to probe what is an extraordinarily complex clause. I wonder whether the good noble Lords, Lord Bassam and Lord Bach, have lulled themselves to sleep trying to comprehend the many subsections contained in Clause 25. The clause has a certain "Alice in Wonderland" quality. "Through the Looking Glass" would not be a bad way of putting it. With these amendments we are trying to ensure that more surveillance has to be dealt with under the category of "intrusive" surveillance, so giving a greater degree of protection for the citizen, something which we believe it is essential to provide in this measure.
Perhaps I may refer briefly to the impact of the European Convention on Human Rights. I am sure that the Committee will ultimately be bored stiff—if it is not already—by constant reference to that convention. However, the convention lies at the heart of the Bill. Furthermore, it will come into effect through our own Human Rights Act on 1st October this year. We believe that the Bill as it stands and Clause 25 in particular fail to acknowledge that the European Court in Strasbourg has made it clear that Article 8 privacy rights can be engaged outside residential premises and private vehicles. Noble Lords will recollect that the definition in the Bill of "intrusive" surveillance is that which is undertaken in or outside residential premises or private vehicles. We believe that that is far too narrow a definition in terms of necessary protection of the public and in terms of the European convention.
For example, in the case of Niemietz v. Republic of Germany, the court held that a person is also entitled to a degree of privacy in professional and business relationships. I am sure that it is already apparent that if Clause 25 is left unamended, in particular subsection (3), it will be possible to carry out surveillance in a doctor's surgery, an MP's office, a restaurant, a public place, the workplace or a vehicle. None of those areas will be protected by the need for independent authorisation under the Bill as it stands. We feel that that is wrong. Furthermore, it is likely that the Bill will fall foul of the European convention and, in particular, will not meet the precedent set by the Niemietz case. Perhaps I may add that long ago, in 1967, the United States Supreme Court held that privacy rights protect people rather than places. We do not seem to have taken that on board.
I should also tell the Committee that the Data Protection Commissioner has recommended that the definition of "intrusive" surveillance should be widened to include any premises or location where the

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individual has a legitimate expectation of privacy. The same opinion has been expressed by the Irish Law Reform Committee and many others.
I turn very briefly to some of the individual amendments. Amendment No. 103 inserts the phrase in Clause 25(3) that any surveillance which,
"interferes with any person's privacy in circumstances where that person has a reasonable expectation of privacy",
should be seen as an important and guiding principle.
In Amendment No. 107 we seek to add to Clause 25(3) a new paragraph which states:
"Surveillance may be intrusive for the purposes of this Part irrespective of whether permission is obtained from a person able to give permission in respect of relevant premises to the conduct taking place on or in relation to those premises".
That is excepted from "intrusive" surveillance by the Bill as it stands.
Importantly, too, in Amendment No. 103 we seek to delete the major part of subsection (3), to which I have referred. We believe that that will avoid the rather ludicrous distinction between one type of vehicle and another, or one type of premises and another.
Given this immense grouping, perhaps I may deal briefly with the issue that I touched on at the beginning of my remarks; namely, covert human intelligence sources. That is dealt with—
Lord Williams of Elvel: Will the noble Lord tell me whether the Liberal Democrats were party to the grouping about which he has complained? It is the normal procedure for groupings lists to be agreed. Also, I am not quite sure which noble Lord is speaking from the Liberal Democrat Front Bench.
Lord McNally: That is a good point, but the noble Lord has held high office in this place and he knows how much negotiation can go on—particularly when the Government have given us one last day in Committee and have virtually rewritten the Bill on the hoof. My noble friend makes a small point; the noble Lord makes a debating point. We accept the groupings list; we are working to it, and we can also complain about it.
Lord Williams of Elvel: I am sorry to intervene again, but the practice has been clearly set out by Government Whips. It is that groupings are agreed, and once they have been agreed they may be degrouped, but nevertheless Members cannot complain about the grouping. Secondly, as I say, I am not sure who is speaking for the Liberal Democrat Front Bench.
Lord Phillips of Sudbury: I shall continue. I may have over-egged my pudding. I was not party to these groupings. All I can say is that I believe that the task that I have, without prolonging what I have to say and confusing the Committee, is unreasonable. That may be a lesson that we on these Benches also need to learn.
Perhaps I may turn to the second part of this string of amendments; namely, Amendments Nos. 111, 112, 116, 119 and 138. They all deal with the question of
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informers and undercover agents. The broad purpose of the amendments is an attempt to draw a distinction between a police officer who is an informant and a criminal who is an informant. In brief, we believe that it is important that a distinction should be drawn and that the second class of informant should come under a higher test as regards the authorisation needed. That is why we state in Amendment No. 119 that,
"An Authorisation for the conduct and use of a covert human intelligence source whose conduct falls within section 25(7)(d) shall be governed by the same procedures as apply to the authorisation of conduct for the carrying out of intrusive surveillance".
The human intelligence source falling within (d) is included in proposed Amendment No. 112; namely, an informer who,
"engages in a course of action which, without authority, could have led to his arrest and prosecution".
I should add that the European Court in Strasbourg, in Kopp v Switzerland, severely criticised the practice of internal executive authorisation without supervision by an independent judge in relation to surveillance activities. It is, therefore, at least questionable whether self-authorisation within one of the agencies set up under the Bill would be considered a sufficient safeguard in relation to the activities of participating informers and undercover officers in serious crime cases.
Perhaps I may refer also to the case of Teixeira de Castro v. Portugal—I am grateful to Justice for supplying me with these authorities. That case places additional weight on the need for independent authorisation and supervision of undercover operations if the exercise is not to breach the European convention. It may, therefore, in accordance with this string of amendments, be necessary to draw that distinction whereby the use of participating informers and undercover officers in cases where there could be criminal activity requires prior authorisation by a judge. I shall rest my case on these amendments at that rather inadequate and brief explanation.
3.45 p.m.
Viscount Goschen: I welcome the assurance given by the Minister in his opening remarks that his officials will be drawing up a list of agencies to which the provisions of this part of the Bill apply. It may be for the convenience of the Committee in our understanding of the amendments if the Minister could give an overall broad view of what type of agencies those will be. For example, the BBC was mentioned by my noble friend Lord Cope in two different instances: detection of TV licence evasion, and undercover television documentary programmes—which may also be made by agencies other than publicly owned ones; namely, independent television companies. So in order to aid our understanding of this complex set of amendments, and indeed complex part of the Bill, will the Minister give an overview of what type of agencies are being

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authorised; and if they are not mentioned in this section of the Bill, does it mean that any conduct of this nature would be illegal?
Lord Monson: I have only just looked at this group of amendments and have not had a chance to study them in detail. However, it seems to me at first glance that Amendment No. 103 tabled by the Liberal Democrats is a particularly good one. If that could be agreed to, we should save a great deal of time.
Lord Bach: I can agree with the noble Lord, Lord Phillips of Sudbury, to the extent that Clause 25 is complicated. But it is not the first complicated clause that Members of the Committee have had to consider, nor, I dare say, will it be the last. The noble Lord knows as well as I that the point made by my noble friend Lord Williams of Elvel is absolutely right. If there were objections by his party to this grouping—which, I concede, is extensive— they should have been taken at another time. We are faced with the grouping now and, like the noble Lord, I shall do my best to answer the questions raised and deal with the amendments proposed.
Perhaps I may turn immediately to the question raised by the noble Viscount, Lord Goschen, as to who is covered by this part of the Bill. The answer is short. It is public authorities, in the broadest sense of the word, which are covered. Organisations which are not public authorities are not covered.
That takes me straight to the point made by the noble Lord, Lord McNally—who I know cannot be in his place at this moment—about the alliance against counterfeiting, whose exact name I cannot remember. That body is not a public authority and, therefore, could not be authorised to carry out surveillance under Part II. It is not a bad example. However, if it is decided that organisations are public authorities for this purpose, the schedule can be amended.
Lord Lucas: Will the noble Lord expand a little on the consequences of that decision for an institution such as the campaign against copyright theft, or people making investigative television programmes? Does the Human Rights Act mean that these people will now be liable for prosecution for entering and infringing people's privacy; or will they just trundle on much as they have done previously, without any adverse consequences?
Lord Bach: I want to be very careful in what I say, because we were taken by surprise by the mention by the noble Lord, Lord McNally, of the body in question. Our first view is that it is not a public authority. If we are wrong, what I am about to say does not apply, because it would be a public authority and thus covered by Part II.
This is the first time such surveillance, whether done privately or publicly, has been regulated. This is so to the extent that named public authorities will have the power to do this under close regulation. The status of private organisations that conduct themselves in such
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a way needs careful consideration. To adopt a phrase used not long ago, I am not prepared to speak off the hoof on that aspect. I should like to consider what the noble Lord said about it and perhaps write to him. I do not want to commit the Government to saying what the Bill provides about those organisations that are not public authorities and are therefore not covered by Part II. On the face of it, they would seem at the very least not to be acting in the context of the Bill.
I turn to the other amendments, hoping to be forgiven if, in the main, I deal with them in numerical order. The first four amendments, Nos. 100, 101, 103 and 104, spoken to by the noble Lord, Lord Phillips of Sudbury, address the fundamental concepts in Part II. We appreciate the concern to protect the privacy of individuals but we do not believe that the amendments adequately consider the practicalities. Their result might be to extend the stringent requirements attached to the authorisation of intrusive surveillance to a much wider range of activities presently covered under the provisions for directed surveillance. They would also lead to a great deal of confusion and uncertainty for the operational practitioners about what constitutes directed or intrusive surveillance.
There is no problem in identifying in advance operations involving residential premises or private vehicles. However, the same cannot be said about mobile surveillance, which makes up the majority of operations. It may well involve cases in which an individual considers that he has a reasonable expectation of privacy, even though that expectation would vary from one person to another. This would mean, for example, that the police would have to know before each covert surveillance operation began where their target was likely to go and whether he would find himself in circumstances in which he, or another, might have a reasonable expectation of privacy.
Generally speaking, the police and other operatives would not have that information and therefore could not make the judgment. They would not know, for example, at the start of the day whether their target would spend the day dealing in drugs, meeting criminal associates to plan an armed robbery or meeting a friend, going for a drink or a meal and then visiting the home of another friend. To expect the police and others carrying out surveillance to make a decision beforehand on the expectation of privacy of the target and his associates is unreasonable and impractical.
The level of intrusion is proportionate to the seriousness of the offence or other activity being investigated. Therefore, we have restricted the use of intrusive surveillance so that it can be carried out only on the grounds of serious crime and in the interests of national security or the economic well-being of the United Kingdom. However, the definition in the noble Lord's amendments would incorporate a significant number of other activities undertaken by other public bodies. These range from investigating tax evasion and benefit fraud to health inspections of restaurants.
No central records are kept of the number of covert surveillance operations carried out each year. Estimates by the police suggest that they alone

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undertake more than 60,000 operations. In addition, operations are carried out by Customs, the security and intelligence agencies and many government departments and local authorities. Those activities are covered within the provisions of the Bill but are not classed as intrusive surveillance. To expect a greater number of such cases to require prior approval would bring these statutory functions to a standstill, significantly restricting the activities of the police and others. We need clear guidelines that operatives can easily follow, setting the specific circumstances and locations where people have a legitimate and reasonable expectation of privacy. People generally have the greatest expectation of privacy in their homes and in their private vehicles when going about their everyday lives.
We have also responded to the special protection given by Article 8 to a person's home. These are the instances in which we have restricted action to serious cases and to which we have given the highest level of protection. There are other situations in which we think that a person's right under Article 8 also needs to be carefully weighed against the purpose for which surveillance is required. These are dealt with as directed surveillance, but we think that the most intrusive categories need to be fenced off, kept separate and made subject to the most stringent safeguards.
I hope that the noble Lord, Lord Phillips of Sudbury, will see that there are practical difficulties in what I know were probing amendments to see where we stood and that in due course he will withdraw them.
I turn to Amendment No. 102, spoken to by the noble Lord, Lord Cope of Berkeley, which might restrict what can be authorised as part of directed surveillance. The words in brackets in Clause 25(2)(b), which he seeks to remove, provide for authorisations in circumstances in which either the suspect has not been identified or the operation under consideration might reasonably be expected to infringe the privacy of people other than the main target. If it is proportionate to the offence under investigation, such surveillance should be capable of being authorised. Surveillance of a known drug smuggler may well involve an invasion of his wife's privacy too. The Bill allows for that, in regulated circumstances and subject to oversight. Another example is that the police might be aware of organised drug dealing in which an exchange of drugs and money takes place but not know the names of those involved. They might well, and justifiably I would argue, carry out surveillance and follow persons who attended the meeting.
Amendment No. 107, again a Liberal Democrat amendment, would make it clear that the consent of the owner of the property to surveillance is irrelevant for the purposes of the Bill. We have no argument with the intent of the amendment, but it is unnecessary. If a property owner—for example, a prison governor acting on behalf of the Prison Service—allows access to plant a device in a prison cell, that should of course be authorised at the highest levels, regardless of that consent. The Bill provides for that. It is a specific gap in the Police Act 1997 and the Intelligence Services Act
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1994 which the Bill fills in anticipation of the implementation of the Human Rights Act 1998. The 1994–97 Acts focus on interference with property, which can be circumvented with the collusion of the property owner. The Human Rights Act brings a focus on interference with privacy, which cannot be circumvented in the same way.
Amendments Nos. 108 and 138, again spoken to by the noble Lord, Lord Phillips of Sudbury, would remove from the category of directed surveillance interception with one-party consent. We understand the objection to the provisions but we brought them forward after some thought. The important point is that interception with one-party consent will require the same level of authorisation as directed surveillance. We do not deny that the privacy of the third party in such a call is invaded, so such an activity needs to be authorised and subject to oversight. But, plainly, a kidnap situation in which anxious relatives receive phone calls from the kidnapper or the situation of a victim receiving malicious phone calls are different from listening in to a call between two drug smugglers. That is recognised by the lower level of authorisations required. It is important to keep this flexibility.
I turn to Amendments Nos. 111, 112, 116 and 119, all in the name of the noble Lord, Lord Phillips of Sudbury. They seek to engineer an extra category of covert sources. This would be the category of agents or informants who as part of their tasks themselves become involved in the criminal activity. For these cases the amendments propose the highest levels of authority, such as those required to authorise intrusive surveillance.
These are important but not simple matters; nor are they ones that can be, or should be, addressed in this legislation. This legislation is concerned with intrusion into privacy. Part II of the Bill in particular focuses on situations in which privacy can be invaded for legitimate purposes. It sets out the checks and oversight required for occasions when privacy is invaded in this way. It does all of this to ensure compatibility with convention rights, as will be required when the Human Rights Act comes into force in only a few months' time.
The tasking of covert sources is part of the authorisation process set out in the Bill. If an informant or agent is to be used to derive private information, the use of that source should be authorised. The authorisation granted under this Bill will not include giving immunity from prosecution for criminal activities undertaken by the covert source. That must remain a matter for the prosecution authorities and courts on an individual basis, as now. Additionally, the purpose of an authorisation is not to give legal cover to potential criminal activities but to give a lawful basis to conduct in such a way as to make it ECHR-compliant. Therefore, we believe that the higher levels of scrutiny suggested in these amendments are not needed.
I turn finally to Amendment No. 112A, in the name of the noble Lord, Lord Cope of Berkeley. The amendment seeks to bring anyone who provides

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information covertly about crime within the definition of a covert source. We have, quite properly, excluded from the terms of this Bill ordinary members of the public who, out of a sense of civic duty, come forward with information to the police about suspected criminal activity. There are many public contact numbers, such as that for Crimestoppers, which encourage people to come forward with information. Such persons may have obtained the information by chance. They do not want to be subsequently involved, or form any long-term relationship, in order to obtain or disclose further information. They are not being tasked by the police or others to establish or maintain a covert relationship for this purpose.
If we were required to treat all such persons as covert sources, with the requirements in relation to record-keeping and handling, we believe that it would bring the total number of covert sources in this country to many hundreds of thousands. It would also create a massive and unnecessary administrative burden; and it might quickly discourage members of the public from providing the police with vital information and bring to an end that source of information. We cannot countenance that. On that basis, I ask the noble Lord—I understand that he raises this issue to hear the view of the Government—to withdraw his amendment in due course.
On Question, amendment agreed to.
[Amendments Nos. 100 to 102 not moved.]
Lord Bach Lord Bach moved Amendment No. 102A:
Page 27, line 21, leave out ("and (5)") and insert ("to (5A)").
On Question, amendment agreed to.
[Amendments Nos. 103 and 104 not moved.]
Lord Bach: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Post Office Network
4.1 p.m.
The Minister for Science, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, with the leave of the House, I shall now repeat a Statement on modernising the Post Office network which is being made in another place by my right honourable friend the Secretary of State for Trade and Industry. The Statement is as follows:
"Post offices are a vital part of the fabric of our country. They serve 28 million people every week, performing a vital role in local communities, whether they be rural or urban. But the Post Office also faces challenges. Its traditional work needs to respond to the changing requirements of customers, to changes in society and to the opportunities arising from new technology.
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"Last October the Prime Minister asked the Performance and Innovation Unit to draw up a strategy for the future of the Post Office network. The Performance and Innovation Unit's Report is being published today. Copies have been placed in the Library of the House and will be available from the Vote Office. The Government accept all of the report's 24 recommendations. Working with the Post Office and the National Federation of Sub-Postmasters, we shall implement the measures proposed in full and back them with financial support. We shall set aside ring-fenced funding as part of the spending review.
"The Post Office is the largest retail network in Europe. More than nine out of 10 people live within a mile of a post office, but for too long the Post Office network has been a neglected national resource. Now is the time to harness its full potential and to develop in totally new areas. The PIU report identifies three such areas where developments should take place, made possible by investment in a modern on-line computer system for every post office, to which the Government are contributing over £500 million: first, to establish a universal bank; second, to provide Internet access and exploit e-commerce; third, to provide an enhanced role in government services.
"The Government are aware that their decision to move to a system of automated credit transfer between 2003 and 2005 has caused concern, but people were already voting with their feet and choosing to have their benefits paid into their bank accounts. Today I can guarantee that even after the move to ACT, pensions and benefits can still be paid in cash in full at the post office if that is the choice of the individual pensioner or benefit recipient. The universal bank outlined in the PIU report would provide the means of achieving this. It would ensure that all benefit recipients and pensioners, now and in the future, can continue to use post offices to receive their cash. It would be a post office based solution, as called for by the National Federation of Sub-Postmasters.
"Today in Britain up to 3½ million adults have no bank account. The universal bank would bring these people into the banking mainstream by providing basic banking services. Customers of the universal bank would be able to take out cash at any post office and use cash machines to take out money. They would be able to set up direct debits to pay bills, enabling them to benefit from discounts on gas, electricity, telephone and other bills.
"The second area is Internet access and the exploitation of e-commerce. By installing Internet terminals in front of the counter and ensuring staff are trained to provide assistance, post offices can help ensure that more people have access to the Internet, and the skills they need to use it. Post offices have an opportunity to market themselves as a convenient local place for people to collect goods that they have ordered on the Internet.

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"The third area is an enhanced role in government services. Post offices have traditionally been places where people can conduct a range of government business, from renewing a car tax disc to getting a fishing licence. That role will be further strengthened with the PIU's recommendation that post offices become one-stop shops—general government practitioners—for advice and information on government services. We shall support pilot projects on this and Internet access.
"This vision of the 21st century is one which applies to all post offices, but the PIU report also identified the particular needs of the network in urban areas and rural communities. The rural post office network has been slowly contracting over the past 20 years. This Government are committed to ensuring that the rural post office network is maintained. The importance of rural post offices cannot be underestimated. Often, they are the last remaining local shop, providing a vital service and also acting as a focal point for the community. The maintenance of such services is, above all, a tribute to the invaluable role of sub-postmasters and mistresses who often provide to their communities much more than is required or expected of them. This Government have already made provision in the Postal Services Bill for the Government to provide financial assistance to post offices.
"In order to protect rural post offices, the Government will place a formal requirement on the Post Office to maintain the rural network, and to prevent any avoidable closures of rural post offices. An unavoidable closure would be when no-one is prepared to take over from a departing sub-postmaster or where an associated retail business is no longer commercially viable. The PIU recommended that this requirement to maintain the rural network should apply—in the first instance—for a period of six years. We accept this recommendation. During this period the Postal Services Commission together with the Consumer Council for Postal Services will monitor the network. The commission will report annually to me on the rural network.
"Presently the Post Office defines a rural post office as one which covers 6,300 inhabitants; 7,500 post offices are currently covered by this definition. However, the Countryside Agency defines a rural post office as one serving a settlement of 10,000 or fewer people. Around 10,000 post offices would come within this definition. I am pleased to inform the House that for the purpose of the policy of protection from avoidable closures we shall be applying the wider definition and therefore cover nearly 10,000 post offices. It is not just in rural areas that post offices play an important community role. We want to maintain convenient access and improve the quality of post offices, in our towns and cities as well as the countryside.
"But—under pressure from changes in the pattern of retailing—the quality of many post offices and associated retail business has declined in urban areas over the years. The best way to address
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this is for the Post Office, working closely with the National Federation of Sub-Postmasters, to build bigger and more extensive offices, reversing years of under-investment. As recommended by the PIU, we will encourage them to do so.
"Post offices in deprived neighbourhoods and estates have a particularly important role, often providing the basis for the only local shop. Our aim is to ensure that people in these areas, where there are few other facilities, continue to have access to high quality post offices, preferably co-located with good shops. To support this we will set up a new fund to improve the quality of post offices in deprived urban areas, better serving the needs oft he local community. Uses of the fund would include installing security measures and modernising the premises.
"These proposals provide a significant package for guaranteeing access to post offices and enabling post offices to provide new services which meet the changing needs of customers. The Post Office will need urgently to develop its plans for taking forward these opportunities. I have asked them to provide these plans by September.
"By providing financial support for these initiatives, the Government are backing a viable, sustainable future for the post office network. But the Post Office itself also needs to respond to the challenges. The PIU report shows that much more needs to be done to maximise the commercial potential of the network, to improve efficiency, and to raise the quality of post offices. The vision set out in the PIU report—which we support—is closely in line with that of the General Secretary of the National Federation of Sub-Postmasters, with whom we have been in close dialogue. The package announced today complements the measures in the Postal Services Bill, to protect consumers and enable the post office to modernise. Post offices, and their customers, in all areas will benefit from the wide range of opportunities offered by a modern on-line computer system in every post office and proposals to establish the Universal Bank, Internet learning and access points and General Government Practitioners.
"Customers in all urban areas should benefit from bigger, more extensive post offices, offering a wider range of services. Those in rural areas will also benefit from the requirement to maintain the rural network. Those in inner cities and estates will benefit from measures to ensure post offices provide good local shops which serve the community.
"This announcement will ensure that people across the country—in rural communities, in our cities and towns—have convenient access to a post office providing quality services. It will offer the opportunities the Post Office needs to face the future with confidence, and to build a network which can thrive rather than just survive in the 21st century. I commend it to the House."
My Lords, that concludes the Statement.
4.15 p.m.
Baroness Buscombe: My Lords, I thank the Minister for repeating the Statement. Perhaps I may say how very much better it would have been if the Statement had been made yesterday before the lengthy discussions on related issues under the Child Support, Pensions and Social Security Bill. Does the noble Lord realise that many Peers would not have been kept at a late hour in this House debating the important issue of rural post offices—being totally in the dark so far as concerns the Government's intentions—if the report had been laid before the House? Did he ever consider that point? Is not this one more conspicuous example of this Government's unacceptable contempt for Parliament?
I must ask the noble Lord directly: was the PIU report in his hand yesterday? If so, why did the Minister not offer this Statement yesterday? Did his noble friend Lady Hollis ask him to make the report available to the House? If not, why not? If the noble Baroness did so, why did the noble Lord's department not agree to do so?
Will the Minister tell the House whether there are any aspects of this Statement which could lead to primary legislation? If so, does he accept that we should be ready on our side to consider delaying the Third Reading of the Postal Services Bill in order to accommodate agreed amendments, if that would help rural post offices?
I turn to the detail of the Statement. We welcome the fact that the Government have at long last put together a package for sub-post offices. Sub-postmasters have waited for more than a year, unable to plan and invest for the future. Post office closures have escalated during the past year. This year 500 have closed. Sub-postmasters have demonstrated their deep-seated concern in many ways—for example, by holding a rally in April, which was attended by more than 2,000 sub-postmasters, and through submitting a petition containing more than 3 million signatures to the Prime Minister at No. 10 Downing Street.
Would not it have been better for the Government to have waited to announce their future intentions until they had developed a practical workable strategy for the future of the Post Office before making halfhearted announcements last year? Those announcements will lead to the loss of £400 million income from sub-post offices, have caused much uncertainty and concern and have led to the appalling number of post office closures.
We welcome the Government's determination to maintain a minimum network. But can we have clarification of what that network will really mean? We note their commitment to maintain the rural network. The Minister states:
"I am pleased to inform the House that for the purpose of the policy of protection from avoidable closures we shall be applying the wider definition and therefore cover nearly 10,000 post offices".
Currently there are 18,500 post offices. Does it mean that 8,500 post offices will be at risk? How will those which will be maintained, and which the Government
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guarantee will not close, be funded? How will that £400 million loss be recouped through the services that they will provide, a matter referred to in the Statement? For example, where will the banking charges fall to cover the 3.5 million potential new customers for the universal bank? Will they fall upon the customer, the post office, the bank or the taxpayer?
The Statement raises many more issues. Is it the Minister's intention to allow parcels to be handled by commercial freight and parcel carriers other than Parcel Force? Is that how he will recoup the £400 million of revenue lost to post offices? What about the subsidies? On these Benches, we understand that the Post Office does not want subsidies. In the debate in this House at Second Reading, the noble Lord, Lord Dearing, said,
"There is no security in subsidy".—[Official Report, 2/5/00; col. 958.]
Has the Minister made an analysis of the potential distortion for competition here?
This is a very important point. It raises important questions with regard to competition with other small local businesses which it was thought the Government are also seeking to support.
In responding to the Minister's Statement, I have asked a number of questions. I make no apology for that. This is a crucially important issue and we on these Benches would be failing in our duty if we did not press the Minister for a full reply.
4.20 p.m.
Lord Razzall: My Lord, it will not come as a surprise to noble Lords to realise that the tone of the response from these Benches will be slightly different from that of the Conservative Opposition. I must say that when listening to the Conservative Opposition on this subject it always amazes me that they never actually mention that it was the Conservative government's decision to introduce automated credit transfer which caused this problem in the first place. However, that is obviously a matter upon which they will reflect.
I am sure noble Lords will appreciate that this is a massive victory for those who have been campaigning in favour of the sub-post office network over the past year or two. When this campaign started there was relatively little recognition from the Government that there was a problem. The campaign, led throughout the country by people involved in the sub-post offices and the political parties, has today brought the beginnings of a result. One wonders why that is.
The Prime Minister is often fond of teasing the Liberal Democrats that its policy at the last election to put 1p on income tax to fund education was the longest P in history. I believe that in this particular case the Prime Minister has found that post office closures and pensions are the two disastrous Ps in electoral terms over the past year or so, at least until he met the Women's Institute. I believe we must recognise and welcome the significant shift in government policy that the Statement represents.

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I am sure the Minister will not be surprised if, having welcomed the Statement, I probe him a little on one or two of the fundamental points of detail.
First, the critical issue that is missing, and missing from all government pronouncements, is how much money is going to be put into it and will that money be guaranteed? No doubt the Minister's answer will be somewhat analogous to Mr Byers's response on the radio this morning when he said, "More than you expect". I believe this House deserves a response and an undertaking from the Minister on behalf of the Government that satisfactory financial resources will be found in the Comprehensive Spending Review to maintain the commitments set out in the document, and that that commitment will be given for the whole period until 2006. We require a guarantee that whatever financial requirements are set out in this report the money will be made available. If the Minister can, he should take the opportunity to make that undertaking today.
My second point is particularly important as regards the continuation of rural post offices. I have noticed a slight discrepancy between the Statement and the report of the Performance and Innovation Unit. The Statement indicates that the Government will ensure that the finances are available to maintain the rural sub-post office network unless a closure is unavoidable. In the Statement an "unavoidable closure" is defined as one where no one is prepared to take over from a departing sub-postmaster—an obvious requirement—but it goes on,
"or where an associated retail business is no longer commercially viable".
Those words do not appear on page 86 of the Performance and Innovation Unit report which indicates that the Post Office would be required to maintain post offices in rural areas except where it was impossible to find replacements for departing sub-postmasters. Nowhere can I see in the Performance and Innovation Unit report any reference to the second requirement regarding the associated retail business no longer being commercially viable.
It may seem a small point of language but it is actually a fundamental point of principle. In a large number of rural sub-post offices there may well be an associated retail business which is not commercially viable but which the community may want to retain and which somebody may be prepared to take over from the retiring sub-postmaster. Therefore the Minister needs to indicate whether he accepts what the Statement says. The Prime Minister's letter states that the Government accept all the recommendations of the report and that the words that have crept into the Statement about the associated retail business are a gloss which is not accepted by them. In other words, the Government will agree to subsidise sub-post offices where necessary, provided that there is somebody prepared to take over from the departing sub-postmaster, whether or not there is a failure of the related commercial business.
My next point relates to urban closures. There is an assumption that only rural post offices are involved. It is quite clear to those of us who go around the country
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that it is just as much an issue for urban post offices. I know the unit's report indicates, and the Government have accepted, that a fund would be set up to provide a subsidy to urban post offices where necessary. But the Minister ought to give an undertaking that the Government regard the problems of urban sub-post offices with exactly the same concern as they do those of rural post offices. Members of the House who canvassed in the Tottenham by-election recently will recognise the problems of urban post offices.
My next point is one of timing. As the noble Baroness, Lady Buscombe, indicated, post offices are closing as we speak. I am concerned that the consultation mechanism regarding rural post offices will not be completed, according to the unit's report, until approximately the autumn of 2001. I believe the Minister does need to give an undertaking that steps will be taken to accelerate the subsidy if necessary to stop the urgent and very dramatic problems that are occurring as more and more post offices close.
Clearly, the Government think that this Statement will give confidence to rural sub-postmasters and therefore that the closure programme will stop. But the Minister ought to indicate that the programme will be accelerated if the Statement and what flows from it does not staunch the closures that are currently occurring.
Finally, on a small point of detail but a big point of principle, we on these Benches welcome the desire to turn the sub-post offices into—dare I say?—Internet cafés. The rural sub-post office can become the Internet café of the future. There is one small technical point of which I am sure the Government are aware. In order for that to happen, effective ISDN lines into those post offices are required. Noble Lords who live near rural sub-post offices will be aware that it is virtually impossible to get an ISDN line into those offices or into one's house. If the Government are going to implement the proposal, they will have to give an undertaking to solve the problem of ISDN lines going into rural areas.
4.30 p.m.
Lord Sainsbury of Turville: My Lords, perhaps I may first make clear to the noble Baroness, Lady Buscombe, that I did not have the report in my hands last night. If I had, I would have made it available and commented on it. The first time I saw it was when it came off the presses this morning.
Perhaps I may also make clear that it is extremely important to get these measures right and we asked for the PIU report because we wanted to get them right. The task of producing a report on such a complicated issue in eight months was extremely difficult, but it has been well done.
I find it extraordinary that the party of a government who presided over the closure of 3,000 post offices during 18 years—in 1992 alone, they presided over the closure of 478 post offices—should come here and say that we should have acted with greater urgency. That smacks of a hypocritical

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approach. If the issue is so urgent, it was urgent when they were in power and they should have done something about it.
The noble Baroness criticised the timing. We first had to clear up the incredible mess that had been made of the computerisation of the post offices. It was started by the previous government and was done extremely badly. It was three years behind schedule and was costing a great deal of money. We first had to correct that system; we have now moved on to deal with the viability of the post offices.
We are not giving a guarantee about the other 8,000 post offices. We believe that the major problem with the rural post offices results from the declining population in those areas. We want post offices in urban areas to remain on a commercial basis. We are providing them with financial assistance on the basis that it will give them time to develop new services. We want to try to keep them on a commercial basis, but we recognise that there will be problems while they make the changes. We want to help them do that. That is exactly the right course. It retains the commercial basis while taking a position on access and social justice. That combination lies behind these processes.
What alternative has been suggested? It is that nothing is done and that we maintain old systems, which the previous government realised should be changed, and wait while the lifeblood of the Post Office flows away. I cannot believe that any government could see that as a responsible approach to the system.
The proposals will cost a considerable sum of money. It is significant in terms of total government finances and therefore it will form part of the spending review. It will be part of the 2000 spending review and that will be the appropriate time to give details.
The noble Lord, Lord Razzall, queried the position of shops attached to post offices. That is covered on page 85 of the PIU report. The distinction is that we are considering giving financial support to the Post Office and its services. An open-ended commitment covering shops attached to or containing post offices is a different consideration.
I turn to the differences between urban and rural post offices. The problems are different. The decline in the rural population is creating a major problem, while urban areas have suffered from a long period of under-investment. We are setting up a fund to correct that situation and to enable post offices to go forward on a commercial footing. I believe that the policy meets the needs of rural communities and of deprived urban communities. It does so, not by looking backwards and trying to preserve the systems and views of the past, but by looking forward and trying to create new businesses and opportunities which will make post offices viable. They will be able to continue to provide valuable services to rural communities.
4.34 p.m.
Lord Boardman: My Lords, I welcome any proposal put forward to help post offices, to stop their decline
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and, it is to be hoped, to reverse it. However, it would have been helpful if the Statement had been made before last night's debate. Indeed, today's Statement appears to be almost a response to last night's attacks.
I shall not attempt to go through the Statement, but I want to make one general point. It appears to be a knee-jerk reaction to the criticisms made and needs to be considered in detail. However, I was struck in particular by the security angle. I am concerned about the number of post offices which will be equipped to provide the degree of security necessary to safeguard the amounts of cash which they must handle. Village post offices are vulnerable as it is, but for large parts of the day only one person is left in charge. The security aspect will need careful consideration and no doubt will receive that from the Government.
The Statement raises the question of whether the large number of rural post offices, often in small cottages, will be capable of providing the security required to provide the service that is contemplated. I hope that a satisfactory answer will be forthcoming. However, I welcome any proposals to help the Post Office, but I shall await more detail in due course.
Lord Sainsbury of Turville: My Lords, while it may be felt that the report is a response to last night's debate, the record will show that it was requested eight months ago. It has not been cooked up overnight! I believe that we are approaching the problem reasonably by saying that this is a serious issue which requires serious consideration. We came forward with the report as soon as possible.
I agree with the noble Lord as regards security. It is an extremely important issue in deprived urban areas and we shall use the modernisation fund in dealing with it.
Lord Clarke of Hampstead: My Lords, I declare my interest as a former Post Office worker and former official of the Union of Post Office Workers. Having done so on a number of occasions, it will come as no surprise to your Lordships' House. Although I am an outspoken critic of the Government's overall plans for the future of the Post Office, which we shall discuss tomorrow, it would be churlish not to welcome the general thrust of today's Statement. However, a couple of elements are missing.
The first is the lack of reference to Crown offices in any form or detail. They are a valuable part of the network, providing Post Office workers who offer back-up services, training and reserve forces for emergencies when postmasters are in need of them. The Crown offices deserve a mention in the Government's overall vision.
Secondly, as I have not seen the PIU report I should like to know more about the universal bank. Will it be a copy of the highly successful National Giro Bank which was created by the Post Office and sold off by the previous administration at a knock-down price? At the time of its sale, it was successful and efficient and there was a long waiting list of people who wanted to open accounts. The Scotsman was the only newspaper

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to tell the truth about the whole charade of selling off the bank. It is a disgrace which will haunt the previous administration for many years to come.
I do not believe that the report was brought forward to today because of last night's performance; I believe that it was done because of tomorrow's performance. It is pre-empting what we are to discuss tomorrow, and I find that a little unsatisfactory. However, I feel that some mention should be made of the Crown office network and the work done by its managers and staff. I believe also that more information should be made available about the universal bank. It would do the Government great credit if they were to start again and create another national Girobank which served the public and was socially useful and efficient.
Lord Sainsbury of Turville: My Lords, I am glad that my noble friend welcomes the general thrust of the report before we return to our discussions tomorrow. The report covers the Crown offices but there is no change in government policy in relation to them. We are still committed to maintaining 15 per cent of the business which goes through the Crown offices.
The services which will be offered by the universal bank are covered, I believe, on page 73 of the PIU report. They are not exactly the same as those of the Girobank because the situation is slightly different. However, I believe that it is an important initiative which could have enormous social benefits if, over the years, it brings more people into the banking system.
I do not believe that noble Lords can have it both ways. We were asked whether we could possibly bring the matter forward before the Postal Services Bill had been through the House, although it should be said that that Bill concerns the public status of the Post Office and not the network. We tried to meet the commitment to the House to bring the matter forward, but it is a trifle harsh for noble Lords then to say that we did so only because of the debate the following day.
Lady Saltoun of Abernethy: My Lords, perhaps I may ask the Minister three brief questions. First, will customers be charged for banking services? I believe that the noble Baroness, Lady Buscombe, asked that question and I do not seem to remember that she received an answer. Secondly, at present certain services, such as the sale of car tax discs, are provided only by Crown post offices. Will those services be extended to all post offices? Thirdly, what will happen to small rural post offices in shops where space prohibits any degree of expansion?
Lord Sainsbury of Turville: My Lords, if the explanation was not clear, I shall repeat it. We have made clear on a number of occasions that benefits can be collected in cash and there will be no charge. People will receive benefits exactly as they did previously. There will be no difference. If people ask for more bank services or if we wish to extend them, that is obviously a different question.
With regard to Crown services, so far as I know there is no proposal to extend the services which currently are provided only by Crown offices to sub-post offices. I believe that that is due to the fact that if
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the full range of Crown office services were to be provided in a rural post office, there would be too many with which to deal and operation would become difficult. I believe that those were the two main questions asked.
Earl Russell: My Lords, a Frenchman once fell off the top of the Eiffel Tower and, when half-way down, was heard to murmur, "Good, if it lasts". I hope that the Minister understands why I welcome the Statement in that spirit.
It may be said that if the issue were urgent people would have taken it up earlier. Perhaps I may make it clear that that does not apply to these Benches. I have been trying to remember when I was first alerted to the matter by my honourable friend Mr Kirkwood. I believe that it was in the Parliament before last, and that is not exactly a case of "Archie-come-lately".
I am concerned especially with the social security issues involved. I welcome warmly the provision for people to receive benefits at the post office in cash. However, as benefit provision has very little spare fat, I should like to ask whether they can do so without paying bank charges, which many of them are not in a position to do.
In addition, as some benefit income, such as housing benefit, is necessarily on occasion irregular, will the Minister and his noble friend Lady Hollis of Heigham consult each other about the rather more long-term problem regarding whether people on benefit might be able to receive small amounts of credit on rather more generous terms than those they receive at present from loan sharks?
Lord Sainsbury of Turville: My Lords, I am happy to exonerate the Liberal Democrats from any suggestion that they have not always been keen to make this proposal, although I suspect that the noble Earl's comment was not aimed at me but at the other Benches.
So far as bank charges are concerned, I repeat that people will be able to receive benefits in cash without paying bank charges. That is fundamental to the issue. However, I believe that it should be made absolutely clear that a credit facility is not being provided and, indeed, people will not be able to get into debt with the universal bank. That point is clear and important and should be understood.
Lord Lipsey: My Lords, will my noble friend join with me in congratulating the PIU on the open and innovative way in which it conducted the inquiry and on the splendid report it produced? Will he also take to heart the very wise words of the noble Baroness, Lady Buscombe, that there is no security in subsidy and, in particular, that if there is one thing worse than explicit subsidy it is hidden subsidy provided by distorting the social security system? That is a rotten way to go about this very important task. Therefore, will he agree that the measures in the PIU report, including the provision of funds to encourage shops to invest so that they have a long-term future, represent the true way

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forward; that is, not allowing the tail of social security to wag the dog of keeping rural post offices prosperous?
Lord Sainsbury of Turville: My Lords, I believe that the PIU report is excellent because it considers commercial issues and commercial viability while taking account very strongly of the social issues. I believe that it is that mix which makes the report so impressive.
I agree totally that there is no security in subsidy. That is why the matter is structured very carefully. It concerns the provision of support to sub-postmasters while they obtain extra business to develop their operations. It combines financial assistance with an attempt to return to viability. I agree totally with my noble friend that a hidden subsidy, particularly one based on over-paying for services while keeping those services inefficient, seems to be the worst conceivable way of providing assistance. If financial assistance of some kind is to be provided, it should be on a basis which leads to a viable system.
The idea of keeping antiquated systems is one to which people seem to return again and again. They believe that keeping old systems which everyone knows are long out of date is a way of keeping the service viable. It is not, because, first, people will vote with their feet and, secondly, it is a way of hiding financial assistance, which means that the matter is not being addressed properly.
Lord Skelmersdale: My Lords, I congratulate the Minister on circulating to some Members of the House as early as he decently could a copy of the PIU report, especially to noble Lords who, like me, are interested in the Postal Services Bill, which we shall debate tomorrow. However, I did not hear the Minister's answer to my noble friend's question. Is there anything in the PIU report which will necessitate a government amendment either to the Bill or, indeed, to the draft licence, which he has also circulated to Members of the House who are interested in that Bill?
I agree with the noble Lord, Lord Clarke of Hampstead, that the Post Office Girobank was spectacularly successful as a bank, but unfortunately it did not act as the bank to ease low-income families into the banking system, as the PIU suggests that a universal bank should do. If it had succeeded in that, we would not find that more than 15 per cent of adults do not have a current account.
Lord Sainsbury of Turville: My Lords, there will be no change to primary legislation as a result of the announcement. That is why we drew up Clause 103. We are ahead of the game, even if only slightly. I am afraid that I cannot tell the noble Lord whether it will make any difference to the draft licences, but I shall certainly write to him with the information.
Lord Ezra: My Lords, having regularly asked questions about the Post Office and its services over the years, I welcome the proposals and look forward
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to reading the detail with great interest. What are the financial implications? I realise that the Minister cannot tell us about the amount of government funding until the expenditure review is undertaken. But will the objective of the measures that he has announced be to restore the income that it was estimated would be lost to post offices as a result of the previous proposals to change the payment of benefits?
Lord Sainsbury of Turville: My Lords, I find it difficult to answer that question, because I do not understand the figures about the losses that would occur to sub-postmasters. A sub-postmaster is currently paid 13p for every benefit transaction that he undertakes with the claimant and 17p for every transaction that comes through the banking system. There are no proposals to change that. I do not know where the figures for lost payments come from. The payments that sub-postmasters receive for those services will remain the same.
Lord Hylton: My Lords, I welcome the positive points in the Statement, but I hope the Minister does not think that the population is declining in all rural areas. It is certainly not declining in Somerset and I imagine that there are several other areas where it is rising. Will the postmaster's salary be kept available when the existing incumbent retires, given the length of time that is often needed to find a suitable replacement? Will the Minster also give some thought to places where the village shop has already gone? Sometimes it has been replaced by a community shop manned by volunteers and in other cases there is still a pub or garage available to which a new post office business could be linked.
Lord Sainsbury of Turville: My Lords, the decline in rural population is not a universal phenomenon. If I implied that it was, I was clearly incorrect; but it is an important factor in some areas. The question of payments to sub-postmasters is a matter for negotiation between the Post Office and the sub-postmasters. I cannot give any guarantees. Where there is no sub-post office, there is no intention to make an effort to bring one back, because such a huge number have gone. As I said, 3,000 were lost under the previous government. We are still working on the details of how the financial system will work.
Baroness Byford: My Lords, I hesitate to ask a question, knowing that we are debating the subject tomorrow, but I have two points for the Minister. First, he talked about pilot projects. How many are anticipated and what is their time-scale? Secondly, although he has not been able to answer our questions on funding, we shall want to press him further in tomorrow's debate. He used the word "we". I understand his difficulty, but I do not know whether "we" means the Government, the Post Office, the taxpayer or the local authority. Clarification would be helpful.
Lord Sainsbury, of Turville: My Lords, the noble Baroness can certainly press me tomorrow, but the

927
words that I used were the ones that had been agreed for this Statement. I shall not give a different answer. We are talking about a significant sum. The precise amount should be revealed at the time of the spending review. I suspect that I have used the word "we" in a number of different contexts, but it usually means the Government.

Regulation of Investigatory Powers Bill
4.56 p.m.
House again in Committee on Clause 25.
Lord Lucas Lord Lucas moved Amendment No. 105:
Page 27, line 24, after ("vehicle") insert ("owned or occupied by anyone subject to surveillance").
The noble Lord said: I shall also speak to Amendments Nos. 106 and 109. If the noble Lord, Lord Phillips of Sudbury, wants to know how to make small groups, the answer is to ask for them. The Government complain mightily, but they give in eventually.
There are three minor problems with the wording of the Bill on which I should be grateful for elucidation. Amendment No. 105 relates to subsection (3)(a), which says that surveillance is deemed covert if it
"involves the presence of an individual, or of any surveillance device, on any residential premises or in any private vehicle".
That seems to imply that observing someone's activities from a flat with agreement of the occupants—as one has often seen done on television and elsewhere—or using a private vehicle in the street to watch what is going on in the street counts as covert surveillance. That seems very odd, so I suggest inserting the words "owned or occupied" to show that only when the subject's house or vehicle is being observed from outside does surveillance count as covert.
Amendment No. 106 would delete subsection (3)(b), because I do not believe that merely watching something from outside falls within the ordinary definition of "intrusive". Perhaps the Government do not agree and feel that the entirety of what happens in a house should be sanctified.
Amendment No. 109 would delete subsection (5), which says that subsection (3)(b) does not apply when,
"the device is such that it consistently provides information of the same quality and detail as might be expected to be obtained from a device actually present on the premises or in the vehicle".
I cannot think of any circumstances under which that stipulation would not be satisfied. It must surely be impossible, as long as you draw a line far enough, to gain intelligence from a remote device placed, perhaps, 100 yards away which is as good as that which can be obtained from a device of the best possible quality situated inside the house. By the laws of physics, there must be interference and noise of some sort or another introduced by that distance of, for example, 100 yards which will mean that subsection (5) is always satisfied.
I should be grateful for some guidance from the Government as to where they think the line should be drawn between "intrusive" and "not intrusive" and how the wording in subsections (3)(b) and (5) work together to make that a line which is understandable to officials in practice. I beg to move.
Lord Monson: I have no firm views on Amendments Nos. 106 or 109. But it seems to me that if the Government do not accept Amendment No. 105, or something very like it, they will be shooting themselves in the foot. As the noble Lord, Lord Lucas, pointed out, if Clause 25 is left unamended, the people doing the surveillance will be caught and that is surely not the Government's intention.
Lord Phillips of Sudbury: Had the noble Lord, Lord Lucas, not tabled these amendments, we should have tabled similar amendments. We wish to support them.
In subsection (5), to which Amendment No. 109 relates, it says that surveillance,
"is not intrusive unless the device is such that it consistently provides information of the same quality and detail as might be expected to be obtained from a device actually present on the premises".
That seems to me to be an extraordinarily high test and largely reduces the protection around intrusive surveillance which other parts of the clause are designed to provide.
I also raise the fact that the Data Protection Commissioner, whose views must surely be given some weight in these matters, responded to the Bill in March of this year by citing the instance of a picture from a long-lens camera. That may not be quite as clear as a picture from a camera placed in the room but it did not necessarily reduce the infringement of privacy.
Finally, in response to a reply from the noble Lord, Lord Bach, on an earlier amendment moved from these Benches, from a practical standpoint, in terms of working those complex provisions, how is one to know in advance whether the quality and detail of information obtained by a device is or is not of a consistent quality commensurate with information obtained from within the premises?
All in all, we believe that those provisions are impractical, unworkable and unnecessary and that the Bill would be improved without subsection (5).
Lord Bach: We were a little unclear about the purpose of Amendment No. 105 tabled by the noble Lord, Lord Lucas. The amendment inserts the words,
"owned or occupied by anyone subject to surveillance",
after the word "vehicle". But Clause 45 already defines "private vehicle" as,
"any vehicle which is used primarily for the private purposes of the person who owns it or of a person otherwise having the right to use it".
That formulation in Clause 45 is intended to catch the occasions when a vehicle might be in use and being used for private purposes.

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As before, that distinction may not be perfect in terms of pure issues of privacy but we need to give a clear steer as to the circumstances in which an authorisation will be appropriate. The Bill does that and it is compatible with convention rights in that regard.
Amendments Nos. 106 and 109 would lessen the controls placed on the use of intrusive surveillance. The aim of Part II has been to cover the activities of law enforcement and other agencies and to place the most stringent controls on those activities where a person has the highest expectation of privacy—in his home or his own vehicle.
To accept these amendments would remove from that category those operations or investigations where the police or others used highly sophisticated equipment—for example, laser microphones—to obtain details of a conversation inside a person's home without installing a device on those premises. We are not prepared to lessen that control which is why we cannot accept the amendments.
I am asked about the person carrying out the surveillance. He would have lawful authority by virtue of the authorisation itself.
Lord Lucas: In Clause 45 the definition of a "private vehicle" is,
"any vehicle which is used primarily for the private purposes of the person who owns it",
and residential premises are similarly defined. So let us suppose that we have a policeman sitting in my flat, watching some drug dealing going on in the street below. Surely, that is caught by the current wording of Clause 25(3)(a) to mean that that is intrusive surveillance, merely because the policeman is sitting in my flat watching someone else because my flat is a convenient place from which to undertake the observation. There is nothing in the definition of "residential premises" or "private vehicle" to say that those must be owned or used by the person who is the subject of the surveillance.
That is the purpose of Amendment No. 105. Otherwise, any surveillance operation which in any way makes use of residential premises or a private vehicle becomes intrusive. That seems to me to be extremely odd.
As regards Amendments Nos. 106 and 109, I understand the Government's position to be that the home is sacrosanct. I am quite prepared to work with that position. But then, as the noble Lord, Lord Phillips of Sudbury said, subsection (5) is lunatic. There has been reference to a laser microphone. That uses the vibrations in a pane of glass. So the sound quality depends on the way in which a pane of quite thick glass, perhaps even double glazing, responds to sound waves. Under any circumstances, from the absoluteness of physical laws, it has to be worse than having a microphone on the premises. So subsection (5) will always be satisfied, so Clause 25(3)(b) has no effect. What the Government are saying they wish to do is entirely negated.
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If we accept entirely what the Government wish to do, then they must entirely recast subsection (5) in some way to take out that extremely high test.
Finally, I understand why an Englishman's home is his castle, and we should treat that seriously. But why is there this passion for vehicles? I thought that it was this party which was meant to treat the private car as something special. Is not the party opposite meant to be encouraging the use of public transport? If this law comes into effect, everyone will have to use cars because then they can have a mobile source of privacy. Cars will be taken to the office because people will then be able to dodge out of the office into the car and not be subject to surveillance. That seems very odd.
I should be grateful for a response on those three points because I do not believe that I have been given a satisfactory answer on anything.
Lord Bach: The noble Lord has raised a difficult point. We want to think further about it, particularly as he was supported by the noble Lord, Lord Phillips of Sudbury. Therefore, if the noble Lord will withdraw the amendment, I shall take it away and think about the points he made, particularly in relation to subsections (3)(b) and (5) to see whether or not they are inconsistent. We are grateful to the noble Lord for raising this issue and we shall come back to him on it.
Lord Lucas: A little flattery will get one everywhere! I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 106 to 109 not moved.]
Lord Bach Lord Bach moved Amendment No. 110:
Page 27, line 43, at end insert—
("(5A) For the purposes of this Part surveillance which—

(a) is carried out by means of apparatus designed or adapted for the purpose of detecting the installation or use in any residential or other premises of a television receiver (within the meaning of section 1 of the Wireless Telegraphy Act I949), and

(b) is carried out from outside those premises exclusively for that purpose,

is neither directed nor intrusive.").
On Question, amendment agreed to.
[Amendment Nos. 111 to 112A not moved.]
Clause 25, as amended, agreed to.
Clause 26 [Lawful surveillance etc.]:
Lord Cope of Berkeley Lord Cope of Berkeley moved Amendment No. 113:
Page 29, line 4, leave out subsection (3).
The noble Lord said: Amendment No. 113 draws attention to subsection (3) of Clause 26, which says that,
"The conduct that may be authorised under this Part includes conduct outside the United Kingdom".
I was slightly surprised that that type of surveillance, to be conducted by the various bodies to which the Committee will turn later, is to be authorised outside the United Kingdom. Presumably such surveillance

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also has to be lawful in the other country concerned, unless it takes place on the high seas. That is my first point.
In regard to other countries' surveillance here, I can see nothing in the Bill that would allow the equivalent authorities of other countries—the police and so on—to carry out intrusive surveillance here. From our point of view, that seems to be a good thing, but one would have thought that sauce for the goose would be sauce for the gander. If we are not to permit the police of other countries to carry out surveillance here, except through our police or customs, presumably we should not suggest that our police should conduct them elsewhere, but should seek the co-operation of the police in the country concerned. I would be grateful if the Minister would comment on that. I beg to move.
Lord Bach: We understand the intention of the noble Lord in moving this amendment. I shall explain why the provision is in the Bill and its effect. I shall also try to answer his questions.
The provision at Clause 26(3) would allow for authorisations under this Bill to be given for the use of surveillance or covert sources where some or all of the activity was to take place outside the UK. That can be seen to be directly relevant in the case of an intelligence agency with a remit to operate abroad, but it may also be relevant in some other areas such as drugs investigations by the police and customs.
There are geographical limits to the authorisation of intrusive surveillance. Those are set out, principally in respect of police forces, at Clause 31 of this Bill. In respect of authorisations that can have application abroad, the effect of the authorisations would be to provide reassurance to UK courts that a particular activity was, first, in accord with ECHR principles; secondly, authorised at a sufficiently high level; and, thirdly, subject to independent oversight, should evidence subsequently be brought before a court or should a Human Rights Act challenge based on that activity be made in our courts.
Without such a provision, evidence—when produced in a court in the UK—may be vulnerable to the charge that it had not been authorised in accordance with the law as required by Article 8 of the convention.
The provision does not grant a general licence to operate abroad. If the force or agency in question has no remit to act overseas, this Bill will not give it one. Indeed, for most such operations, the authorisation would cover an operation in which foreign authorities were in the lead, or at least involved. This provision would merely serve to protect any evidence arising from such operations when brought before a UK court. This is clearly desirable in helping to convict major and international criminals.
The noble Lord, Lord Cope, asks about other countries carrying out surveillance here. Foreign law enforcement agencies would obtain authorization
932
through organisations here; they would not act here without consultation and without the approval of the relevant agency based in the UK.
Lord Cope of Berkeley: I am grateful for that explanation. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 26 agreed to.
5.15 p.m.
Clause 27 [Authorisation of directed surveillance]:
Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 114:
Page 29, line 32, leave out paragraph (g).
The noble Lord said: The point of Amendment No. 114 is relatively simple to explain. Clauses 27 and 28 of the Bill provide the circumstances in which authorisation can be given, on the one hand, for direct surveillance and, on the other hand, for covert human intelligence. As the Minister said earlier, it is part of the protection supposedly provided to citizens by this Bill and its extraordinarily wide powers, that that authorisation procedure is clearly defined and battened down.
The Committee will have noticed that, according to both clauses, authorisation can be given only where it is necessary on grounds specified in subsection (3) of Clause 27. That subsection is in the widest terms and includes national security, preventing crime, preventing disorder, in connection with economic well-being, public safety, public health, collecting tax and so on. The final paragraph, (g), states that the Secretary of State can, by order, specify other grounds on which these key authorisations can be given.
I believe that Members of the Committee agree this is a difficult Bill, an important Bill, and one in which, more than normal, we must be vigilant in protecting basic freedoms and liberties—not, I emphasise, that the Government are trying to put one over on citizens, but it is common ground that the denseness and complexity of the drafting of this legislation require us to be vigilant.
I draw to the attention of the Committee the 18th report of the Select Committee on Delegated Powers and Deregulation, published earlier this month. It states particular concern for the subsections that Amendments Nos. 114 and 117 address. The report states:
"The Committee is of the opinion that the defining of the purposes for which an investigatory power may be used is a vital part of placing restrictions on the exercise of those powers and does not consider it to be appropriate to delegate to the Secretary of State what appears to be an unlimited power to specify other purposes".
It goes on to say:
"It appears, therefore, that the apparently unlimited powers in"—
these clauses—
"may be intended to allow no more than the addition of the protection of morals and the rights and freedoms of others to the purposes set out in those clauses".

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The Select Committee gathered that from a government memorandum to the Select Committee. The report continues:
"If this is so, why are the powers not limited in this way?"—
for example, set out on the face of the Bill—
"Paragraph 19 of the Memorandum argues that section 6 of the Human Rights Act will apply and that the powers are thus constrained by Article 8(2) 'although that limitation need not appear on the face of the bill"'.
That is a quote from the Government's memorandum. The crucial finale of this matter is as follows:
"The Committee does not accept that it is appropriate to use wide terms to define a new power and to rely on the Human Rights Act to restrict its scope when it is possible to define it so that it covers only its intended scope".
I give three cheers for that. I believe this is the first clear example that we have had before us of what I would call thoroughly lazy drafting, where the government of the day are content not to define what is or is not allowed by the government machinery in all its aspects; where they are willing to fall back on a thoroughly weak and inadequate protection by saying, "Don't worry, old chap, just go and look at the Human Rights Act and I am sure you will find a remedy there". That is simply not an answer in a case of this nature. We believe that this is an important provision that the Select Committee perfectly clearly condemns. I invite the Committee to do the same. I beg to move.
Lord Cope of Berkeley: I give one cheer for government Amendments Nos. 115 and 118, which take up part of the recommendation of the Delegated Powers and Deregulation Committee that any power of this character should be subject to affirmative resolution. As the noble Lord, Lord Phillips, said, the actual recommendation of the committee goes much further and, although it is not precisely covered in the Liberal Democrat amendments, the noble Lord has a very good point.
Lord Bach: In replying to the noble Lord's amendments, perhaps I can speak also to the government amendments in this group, Amendments Nos. 203B, 205, 206, 208A to 208C and 115.
The noble Lord, Lord Phillips, quoted from a report of the Delegated Powers and Deregulation Committee. But in a later report that committee accepted the Government's reasons for doing what we are doing. It may be therefore that the noble Lord is wrong to rely on the 18th report and should rather look to the 21st report for an explanation of what we are doing and a rejection of what he proposes.
One of the recommendations of the Select Committee on Delegated Powers and Deregulation was that we should tighten up the arrangements for adding to the grounds on which the various investigative powers can be used. As has already been indicated, we considered that and accepted the weight of the argument. So we tabled the government amendments which ensure that, in respect of each of
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the powers at issue, any addition to the purposes for which those powers can be used will be subject to the affirmative resolution procedure.
We have already explained why we do not believe it is necessary to act on the recommendation of the committee that the Bill should explicitly recognise that none of the orders could include purposes which would go beyond those permitted in the convention on human rights. The Delegated Powers and Deregulation Committee, in its latest report, accepted our reasons.
As we have made clear, the powers in this Bill will be limited by the Human Rights Act. As a matter of law, not simply as a practical limitation, the Secretary of State may make no order that is incompatible with the convention. It is our view that to state on the face of the Bill that the convention rights must circumscribe any use of these orders will add nothing to the situation in law. That is an important point; it will be relevant to all legislation in the days post implementation of the Human Rights Act.
Turning to the Liberal Democrat amendments, any additions to the purposes on the face of the Bill will, as a matter of law, have to fall within the exceptions set out in Article 8(2) of the convention and should be made by means of the affirmative resolution procedure. That has now been accepted by the Delegated Powers and Deregulation Committee as giving appropriate parliamentary control and this Committee should recognise that when debating these amendments. The 21st report deals with that matter.
What scope does that leave for adding to the purposes? I need to answer this today as Amendments Nos. 114 and 117 seek to remove the power to add purposes altogether in a fashion beyond that recommended by the Delegated Powers and Deregulation Committee. The two permitted purposes in Article 8 of the ECHR, which we have not included in the Bill, are,
"for the protection of morals",
and,
"for the rights and freedoms of others".
That was because we could think of no circumstances where public authorities would want to use covert techniques on those grounds. But we thought it necessary to provide the power to enable the grounds to be extended for those purposes should that prove necessary. We can see a time when it may be necessary to use this enabling power in some limited circumstances which would fall within,
"rights and freedoms of others".
Once the HRA is implemented and we have more idea of how it will impact on the activities of public authorities, we may very quickly need to look to adding purposes to the list set out and, if we do want to add purposes, we shall want to limit them as far as possible.

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The Delegated Powers and Deregulation Committee suggested that any use of the order-making power might be limited specifically to adding the purposes,
"for the protection of morals",
or,
"for the rights and freedoms of others",
as mentioned by the noble Lord, Lord Phillips. Those are two quite wide-ranging purposes. If possible, any extension of the powers ought, in our view, to be more specific. Certainly, we should leave that possibility open in the interests of limiting as far as possible the intrusions on privacy.
Members of the Committee will note that this is the approach we have adopted with some of the purposes already listed in the Bill. They do not follow exactly the wording of the convention rights. Some are tailored specifically to meet the requirements of investigating agencies in the modern age. We believe the purposes described fall within those allowed under Article 8(2) and we have used a formulation to narrow the purposes as far as possible.
Of course these are important issues and they are inextricably linked with the implementation of the Human Rights Act. We tabled amendments which we feel ought to provide all the reassurance the Committee requires. We do not claim a monopoly of wisdom on the Human Rights Act—we are all feeling our way—but I seek to persuade the Committee that we have done enough in that regard. I hope that, having heard my explanation, the noble Lord, Lord Phillips, will feel able to withdraw his amendment.
Lord Phillips of Sudbury: I am grateful for the Minister's response. However, I urge on him the intermediate position which the Select Committee proposed; that is, rather than simply leave it to an affirmative resolution, which would of course be an improvement on the Bill, the Bill should contain on its face the two categories to which reference has been made—morals and purposes. That would be the best way of dealing with this matter. It would not leave a completely unknown category to be added by affirmative resolution in the future.
As the cliché has it, the price of liberty is eternal vigilance. It is not a safe way of legislating for us to assume that the nice, reasonable noble Lords who sit opposite will always be in their places. That compromise would therefore be the best compromise. One hopes that the Government will consider it. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bach Lord Bach moved Amendment No. 115:
Page 29, line 41, at end insert—
("(15) The Secretary of State shall not make an order under subsection (3)(g) unless a draft of the order has been laid before Parliament and approved by a resolution of each House.").
On Question, amendment agreed to.
Clause 27, as amended, agreed to.
Clause 28 [Authorisation of covert human intelligence sources]:
[Amendments Nos. 116, 116A and 117 not moved.]
Lord Bach Lord Bach moved Amendment No. 118:
Page 31, line 8, at end insert—
("(5A) The Secretary of State shall not make an order under subsection (3)(g) unless a draft of the order has been laid before. Parliament and approved by a resolution of each House.").
On Question, amendment agreed to.
Lord Phillips of Sudbury Lord Phillips of Sudbury had given notice of his intention to move Amendment No. 119:
Page 31. line 21, at end insert—
("( ) An authorisation for the conduct and use of a covert human intelligence source whose conduct falls within section 25(7)(d) shall be governed by the same procedures as apply to the authorisation of conduct for the carrying out of intrusive surveillance.").
The noble Lord said: Perhaps 1 may say a word on this amendment because I was rather caught on the hop before the break for the Statement.
Many of the points made by the Minister in responding to this and the other amendments in the group will bear scrutiny when we see Hansard. I hope I shall be able to communicate with the Minister before Report stage because we are all striving to make the best of this Bill. For the moment I shall leave it at that, except to say this. The Minister said that in relation to this group of amendments he did not think the provisions were for this legislation. I do not know on what possible basis that can be so, given that the Bill provides precisely for the arrangements vis-à-vis informers.
[Amendment No. 119 not moved.]
Clause 28, as amended, agreed to.
5.30 p.m.
Clause 29 [Persons entitled to grant authorisations under ss. 27 and 28]:
Lord Bach Lord Bach moved Amendment No. 120:
Page 31, line 43, leave out subsection (4) and insert—
("(4) A public authority is a relevant public authority for the purposes of this section—

(a) in relation to section 27 if it is specified in Part I or II of Schedule (Relevant public authorities); and

(b) in relation to section 28 if it is specified in Part I of that Schedule.

(4A) The Secretary of State may by order amend Schedule (Relevant public authorities) by—

(a) adding a public authority to Part I or II of that Schedule;

(b) removing a public authority from that Schedule;

(c) moving a public authority from one Part of that Schedule to the other;

(d) making any change consequential on any change in the name of a public authority specified in that Schedule.

(4B) The Secretary of State shall not make an order under subsection (4A) containing any provision for—

(a) adding any public authority to Part I or II of that Schedule, or

(b) moving any public authority from Part II to Part I of that Schedule,

unless a draft of the order has been laid before Parliament and approved by a resolution of each House.").
The noble Lord said: In moving this amendment on behalf of my noble friend, I shall speak also to Amendments Nos. 121, 159 and 207. There was much discussion in another place about the naming on the face of the Bill of those public authorities using Part II powers. This issue was also raised by the Delegated Powers and Deregulation Committee. We have listened to the arguments put forward and our response is the schedule provided by this group of amendments. The schedule is divided into two parts. Part I lists all those public authorities empowered to authorise directed surveillance and the use and/or conduct of covert sources. Part II lists those authorities empowered only to authorise directed surveillance.
The schedule differs markedly from early versions of the list of public authorities using these powers. First, it names only the public authorities and does not go into details about which agencies within each department will be using these powers. That is because the public authority is the statutory body, not its constituent parts. However, we are intending to narrow down the different agencies within a public authority that can authorise activity under Part II of the Bill. This will be achieved by means of the order produced under Clause 29, which will specify precisely the individuals holding such offices, ranks or positions within the relevant public authority who can authorise activity. For example, the order might specify a senior immigration officer within the Immigration Service of the Home Office as able to authorise the conduct or use of a covert source.
Secondly, changes and additions have also been made to the list. The first provisional list was published during the Committee stage in another place. We made it clear then that the list was being developed and that there would be changes. Since that time we have found that a greater number of public authorities use Part II powers than we had first thought. This has been one of the benefits of the whole exercise. We now have a much clearer picture of the range and types of activity that are going on in public authorities, but we are still learning about public authorities whose activities had not previously come to our attention. This learning process is likely to go on for some time. That is why it may be necessary to add further public authorities as a result of case law developed from judgments on the definition of what is a "public authority" once the Human Rights Act (the HRA) comes into force. That is why the amendments provide for the Secretary of State, by order, to add or remove public authorities from the schedule or to move an authority from one part of the schedule to the other.
Any addition, or movement from Part II to Part I of the schedule, will first need to be approved by Parliament. Of course, that does not mean to say that we have rejected out of hand the recommendation of the Delegated Powers and Deregulation Committee that we should remove the power to add public authorities to the schedule. We have taken careful note of the committee's view, as detailed in its 21st Report, that we should be able to produce an exhaustive list of public authorities now and that it should be for Parliament to decide by means of primary legislation whether any additional existing public authorities should be added to the schedule. Any order adding a body to the schedule would now be subject to parliamentary approval through the affirmative resolution procedure.
However, there is something between us and the Delegated Powers and Deregulation Committee on the issue. We should like to give the matter further thought. Indeed, we propose that a meeting should take place between the chairman of that very distinguished committee and my noble friend the Minister who sits beside me. On that basis, I beg to move Amendment No. 120.
Viscount Astor: We are grateful to the Minister for his explanation of the amendments. However, before I ask him a number of questions in that respect, I have before me the text of Clause 29 where subsection (4)(d) refers to,
"any of the intelligence services".
The reference to other public authorities in the clause is very definitive; for example, there is reference to the National Criminal Intelligence Service, the National Crime Squad and the Ministry of Defence, and so on. Therefore, when the Minister responds, can he tell me whether the phrase,
"any of the intelligence services",
is a definitive or legal term? Now that the intelligence services publish booklets stating who and where they are and, indeed, are subject to parliamentary scrutiny, I wonder why the Bill does not set out the intelligence services involved. It seems to me that that leaves the matter open to debate as regards what is and what is not an intelligence service. As they are now subject to Parliament, would it not be better to define them as such?
Lord Bach: Perhaps I may deal with that point now. As I understand it, Clause 72 defines "intelligence services". Yes, indeed, the definition is to be found at lines 8 and 9 on page 77. I hope that that answers the noble Viscount's question.
Viscount Astor: I am extremely grateful to the Minister for pointing that out. I am glad that, like me, it took him a little time to find the actual wording.
I turn now to the amendments. I have a number of questions about the list, the first of which is general and relates to a matter that was touched on earlier. We are adding local authorities and various other bodies to this list, but I am rather concerned about how this

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will work. Presumably, some local authorities will not have the resources to do this on their own. Will local authorities be allowed to use private contractors for this purpose; for example, will they be able to use private detective agencies? Alternatively, will this have to be done by employees'? Can such activities be contracted out? If that is the case—I do not know whether it is—how will this be organised to ensure that those concerned keep within the rules that apply to such activity?
I note that the schedule in Amendment No. 159 includes a reference to the National Assembly for Wales. As far as I understand it, the reason for its inclusion is because the Assembly is an executive body, as opposed to the Scottish Parliament, which is a Parliament. The amendment simply refers to "The National Assembly for Wales". Can the Minister say whether that implies that the Assembly could have a wider remit when it comes to using these powers than, say, the Department of Health or the Home Office, which are confined within a rather narrow remit? It is purely a probing question, but I should be grateful to receive an answer from the Minister.
Further, under "Other bodies" in the schedule set out under Amendment No. 159, one sees that the Food Standards Agency and the Intervention Board for Agricultural Produce have been included in the list. I am not quite sure why those bodies are there. I understand that there may, perhaps, be a reason for including the FSA because the Bill talks about the economic well-being of the country and, indeed, about protecting public health. I should be interested to know how the agency will use its powers. Similarly, I am rather puzzled as to why the Intervention Board for Agricultural Produce has been included in the list. It seems to me that we are opening up farmers in this country to some kind of intrusive—or even unintrusive—surveillance. I do not know how this will work. I believe that the Government need to explain why these bodies have been included in the list.
Looking further down the list in the schedule, one finds reference to the Royal Pharmaceutical Society of Great Britain. I am not aware that that is either a public body or a quango. I should be grateful if the Minister could explain why the society has been included. I may be wrong and it may indeed be a public body; hut, if it is not, I do not understand how it will be subject to any form of control. That seems to me to raise some interesting questions.
I have asked specific questions about the listings, but I have a more general question about local authorities. As the Minister said, I understand that the Government will be looking to see how this works in the future. However, it would be helpful to know just how many local authorities will actually sign up to start with—for example, will it be a small number and, if so, how quickly do the Government think it will grow? It would be most informative to know what evidence the Government have in that respect.
Lord Lucas: I hope that in the course of his inquiries the Minister will ask the Department for Education and Employment whether it ought to be on the list.
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During my time as an education spokesman several enterprising frauds of Nigerian origin that obtained money from university grants when they should not have done so were investigated. Presumably the whole matter of the repayment of student loans will at some stage require some kind of checking up on the financial status or whereabouts of former students.
Lord Desai: What about the drugs czar? Is the drugs czar independent of the Home Office? Is he a separate agent? I can think of many other examples but that of the drugs czar worries me because he should be included in the list.
Viscount Goschen: Perhaps czars could comprise another category to be defined at a later time.
I welcome the Minister's attempt in these government amendments to try to be more specific in regard to what kind of agencies will fall under the provisions of the Bill. My intervention relates to points that I raised at an earlier stage of today's proceedings.
The Minister was good enough to say that the Bill regulates for the first time the use of surveillance, be it covert or intrusive, and that previously a number of these activities were not regulated in any way. If the schedule applies only to public bodies—there has been much discussion about those public bodies—will the Minister clarify what is its effect on those bodies that are not covered by it? Can they continue as before? Are they in a more advantageous or a less advantageous situation than those bodies which are classified as public? That relates to the point made so ably by my noble friend Lord Astor; namely, whether a public body is able to find a loophole here. Can they use a non-public body to perform their work for them?
I have a final question on the amendment we are discussing although the noble Lord may say that it applies to another part of the Bill and that we may preempt the clause stand part debate. What happens to information that is obtained using covert or intrusive surveillance? I am sure that the noble Lord will point out the relevant provision in the Bill. Are there definitive restrictions on the use to which such information may be put? Earlier my noble friend Lord Cope spoke of the BBC carrying out investigative surveillance. One has often seen on television film shot by the customs agency, for example, in pursuance of an investigation. That may involve covert surveillance. Will it continue to be appropriate for such material to be used for public entertainment, as has occurred in the past, or are there additional restrictions in the Bill to cover such eventualities?
5.45 p.m.
Lord Bach: These government amendments have elicited many questions from Members of the Committee, all of which deserve an answer. The noble Viscount, Lord Goschen, asked again how bodies that are not public authorities are affected by the Bill. He deserves a fuller response than he obtained on the previous occasion he raised that matter.

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Clause 71 states, in terms, that nothing is made unlawful by Part II of the Bill. This part of the Bill is designed solely to allow only public authorities to comply with the Human Rights Act, which deals with public authorities and not with private individuals. It places a duty on public authorities to act in accordance with the Human Rights Act. The authorities that are affected are listed in Amendment No. 159. It is a matter for individual organisations to take a view as to whether they are public authorities. If they believe that they are, they can be added to the list by order.
Bodies that are not public authorities are not affected in any way by the Bill or by the Human Rights Act. Their position in law will be exactly as it was before the Bill becomes law. In other words, their position remains unchanged. If their activities are caught by the criminal law, so be it. However, if their activities are not unlawful, that will continue to be the case.
Viscount Goschen: I am grateful to the Minister for those helpful comments, which have certainly assisted my understanding of the Bill. However, I referred to a private detective agency being able to pursue an activity that is lawful under the criminal law. A public authority, however, would be subject to all kinds of restrictions in pursuing that activity. Could the public authority contract out that work?
Lord Bach: I do not believe that a public authority could contract out fully because, in the end, it would remain liable and it would be caught by the provisions of the Bill; in other words, it would have to act in accordance with the Human Rights Act.
The noble Viscount, Lord Astor, queried some of the names on the list. The National Assembly for Wales is in the same position as any other public authority mentioned in Amendment No. 159. The noble Viscount referred to three bodies and asked why they were included in the list. At the risk of speaking for longer than I had intended, I should explain why that is the case. The noble Viscount may not be aware—I was certainly not aware of this—that the Food Standards Agency is responsible for the enforcement of meat hygiene and related controls in licensed slaughterhouses. Surveillance is used to target individuals or premises, such as purchases at markets or activity at premises; for example, deliveries to farms where illegal activity is suspected to be taking place. The Food Standards Agency needs to be able to undertake such investigations to carry out its function as an enforcement authority for meat hygiene.
The Intervention Board for Agricultural Produce has an anti-fraud unit which uses surveillance to monitor milk quotas. Under the CAP, the UK is permitted to produce a specified quantity of milk a year. If that quantity is exceeded, a levy is raised. Therefore, all producers and purchasers of milk are meant to be registered and have their own quota. If that quota is exceeded, they become liable to levy. There is a market in black market milk where farmers produce milk and sell it to dairies without declaring it
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to the intervention board as they are meant to. It follows that surveillance operations are conducted where farms have been observed to ascertain whether milk tankers have collected milk.
The noble Viscount mentioned the Royal Pharmaceutical Society, which is considered to be a public authority and is therefore included in the list. That society has the power to enforce various sections of the Medicines Act 1968 and the Poisons Act 1972. It uses covert surveillance to ensure that there is no breach of the Medicines Act or the Poisons Act by pharmacists or businesses registered with them. As I say, it appears that not only have the Government learned more about public authorities but we are now sharing this information with the Committee. More bodies may need to be added to the schedule in due course. I believe that I have answered most of the questions that have been asked.
Lord McNally: Reference has been made several times to where a private body carries out the functions of a public body. That happens in a number of areas; for instance, where there are private security firms operating side by side with police forces. Where that happens, will the private body be expected to observe the standards of the public body concerned? Does the public body set the standards in observation of legislation?
Lord Bach: The answer that I have received is that if the situation is as the noble Lord, Lord McNally, describes, it would in effect make the private body a public authority for the purposes of any surveillance or covert action that it may be taking. I think that that is quite a reassuring answer in the context of the Bill.
Viscount Goschen: I am sorry to press the Minister further. Perhaps he will address the point that I raised about the uses to which information and televisual data gained by covert surveillance can be put.
Viscount Astor: While the Minister is considering that question perhaps I may thank him for his helpful explanation and ask him one simple question. I do not need an answer today, but perhaps he will write to me between now and Report stage. I am grateful for the explanation that the Royal Pharmaceutical Society of Great Britain is a public body. I must say that I was unaware of that. If it is a public body, it would be interesting to know to whom it is responsible. Is it responsible to a government department, to Ministers or to Parliament? Perhaps the Minister will write to me before the next stage and explain that. When we are adding all these public bodies, it would be useful to know where their responsibilities lie and to whom they are answerable.
Lord Bach: I shall certainly write to the noble Viscount setting out how the society becomes a public authority. I am conscious of the question, which has now been asked twice, as to what use will be made of the information that is gained from surveillance. I must be very careful how I respond to the noble

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Viscount. Obviously in certain instances it can be used to make out a case against a criminal, a spy or a terrorist. However, what the noble Viscount wants to know is whether it can be used, for example, in a television documentary in order to make a point about wrong-doing. It is quite clear that the authorisations that are granted will have to be granted on specific terms, and of course the more intrusive the surveillance the more specific the terms have to be. To answer the noble Viscount's question fully it will be necessary for me to take proper advice and then to write to him with the use to which it can be put.
Lord Lucas: If the Minister intends to write to noble Lords, I think that it certainly would be helpful to have some enlargement on the nature of public authority. I have looked up "public authority" in the Human Rights Act. Under the Act, a public authority is,
"any person certain of whose functions are functions of a public nature",
but not if the nature of the Act is private. I find that a fairly confusing definition. I should be grateful for something which translated that into ordinary commonplace English so that we can understand the scope of the Bill in practice.
On Question, amendment agreed to.
Lord Bach Lord Bach moved Amendment No. 121:
Page 32, line 18, leave out from ("authority") to second ("by") in line 19 and insert ("added to Schedule (Relevant public authorities) by an order made under subsection (4A)").
On Question, amendment agreed to.
Clause 29, as amended, agreed to.
Clause 30 [Authorisation of intrusive surveillance]:
[Amendment Nos. 121A to 123 not moved.]
Lord Bach Lord Bach moved Amendment No. 123A:
Page 33, line 32, at end insert—
("( ) the chief constable of every police force maintained under or by virtue of section 1 of the Police (Scotland) Act 1967 (police forces for areas in Scotland);").
The noble Lord said: In moving this amendment I wish to speak also to Amendments Nos. 124A, 124B, 124C:, 127A, 136A, 136B, 138A, 194A, 194B, 195, 195A, 203A, 211B and 230.
As the Committee knows, a separate Regulation of Investigatory Powers (Scotland) Bill has been introduced in the Scottish Parliament to cover the devolved activities of public authorities in Scotland. Although we hope the provisions in both Bills will be similar, so as not to impede joint cross-border operations, we also need to provide cover for devolved activity authorised in Scotland which crosses the Border and continues in another part of the UK, and for activity authorised in the rest of the UK which crosses the Border into Scotland. These government amendments, which we have discussed and which have been agreed with the Scottish Executive, provide that cover.
We already have provisions in Part II of the Bill which extend the Bill to Scotland in respect of reserved functions and public authorities with reserved
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functions. But we now extend all of Part II to Scotland, subject to the proviso that, in certain cases, an authorisation cannot be granted under the Bill where all the conduct is likely to take place in Scotland. That is covered by the Scottish equivalent of the Bill. These amendments ensure that conduct authorised by public authorities in England, Wales and Northern Ireland which cross the Border into Scotland will he lawful. They also extend the provisions of the Bill to provide lawful authority for a limited period of time for the activities of Scottish police forces and other public authorities with devolved functions in Scotland, where the conduct is authorised under the Scottish Bill and the activity crosses the Border out of Scotland into other parts of the UK.
Members of the Committee may think that this removes the need for a separate Scottish Bill. However, that is not the case. The amendments provide that an authority should not be obtained under the Bill if the conduct is all likely to take place in Scotland.
Lawful authorisation for conduct obtained under the Scottish legislation will continue if circumstances arise which take the conduct outside Scotland. Such an authorisation will continue to have lawful authority on each occasion that such circumstances arise and will last for three weeks, beginning with the time when the circumstances arose.
An authorisation for directed surveillance obtained by a Scottish police force under the Scottish Bill will continue to give lawful authority, if circumstances arise which mean that officers from that force need to pursue their target across the Border into England. The lawful authority will continue for three weeks on every occasion when circumstances arise which necessitate crossing of the Border. I beg to move.
Lord Cope of Berkeley: I wish to raise a point with regard to the overlap between the Scottish and the Welsh legislation. I understand that the Scottish Parliament has changed the wording of the Scottish Act a little. For example, Clause 30(2) of the Bill says that the Secretary of State cannot grant an authorisation under the Scottish legislation for intrusive surveillance unless he is satisfied that the authorisation is necessary, not that he just believes that it is. There is a slightly higher test in Scotland. Presumably, therefore, under Amendment No. 123A, the Scots will need to fulfil a lower test in England than in Scotland.
Lord Lucas: In this context, perhaps I may ask out of interest whether the phrase,
"in the interests of the economic well-being of the United Kingdom",
would come into force if someone was planning to move a large operation from Scotland to England, or is that ruled out by that phrase?
On Question, amendment agreed to.
6 p.m.
Lord McNally Lord McNally moved Amendment No. 124:
Page 33, line 46, at end insert—
("(7) No authorisation shall take effect until such time (if any) as—

(a) the grant of the authorisation has been approved by an ordinary Surveillance Commissioner; and

(b) written notice of the Commissioner's decision to approve the grant of the authorisation has been given to the person who granted the authorisation.").

The noble Lord said: The amendments in this grouping make a common point; that is, to establish whether the powers vested here are—to use a word favoured by the noble Lord, Lord Bassam—proportionate. The clause covers authorisations for intrusive surveillance. The aim behind the amendments is to ensure that such authorisations are proportionate and that they bring all surveillance under the oversight of the surveillance commissioner.
All noble Lords concerned with the Bill know that a great deal of briefing has been submitted. One piece sent from the Cyber-Rights and Cyber-Liberties Group (UK) caught my eye because it summed up very well the thinking that lies behind these amendments. The group sets out five hurdles that should be cleared before the powers are used.
First, that the action will provide a
"clear net benefit for society. That is, the benefits are clear and are achievable by the measures proposed, without a detrimental impact on the rights of honest citizens … and one that is widely accepted as tolerable in the light of the gains secured".
Secondly,
"That the measures proposed discriminate effectively between criminals and honest, law-abiding citizens. Therefore, they should be balanced and should not, in an impetuous desire to counter crime, expose all honest Internet users to … risks".
Thirdly,
"That of all the options available they are the best in the sense that they are the most effective in countering criminals".
Fourthly,
"They should be based on clearly defined policy objectives which citizens understand and which command widespread public support".
Fifthly,
"They should he enforceable, transparent and accountable".
Those principles could easily apply to other parts of the Bill, but I believe that they apply particularly well to Clause 30. In essence these amendments are an exercise in wing-clipping. It is intended that the Minister should respond wherever he feels that those wings should not be clipped. I beg to move.
Lord Bach: I am grateful to the noble Lord, Lord McNally, for his brief introduction to this series of amendments. It is clear that they probe whether the Government's approach to the important issues surrounding intrusive surveillance is absolutely right. Perhaps I may deal with each amendment in turn.
Amendment No. 124 seems to have two aims. With regard to police and customs activities, it seeks to rule out the situation in which, in urgent cases, intrusive surveillance authorisations can take effect without the
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prior approval of the surveillance commissioner. Perhaps this arises through some genuine concern over the safeguards in the existing system in the Police Act 1997. I am sure that the noble Lord will accept an assurance that he need not worry. I can reassure him on this point.
The Chief Surveillance Commissioner has set up a system for giving approval to authorisations under Part III of the Police Act 1997 which means that there is a commissioner on duty at all times. The procedure is supported by secure communications, which means that a response can be obtained from a commissioner within a very few hours. From when the Office of Surveillance Commissioners started operation in February 1999 to April of this year—a period of some 15 months—only 12 cases had been dealt with under the urgency procedure; that is, an authorisation normally requiring prior approval of a commissioner has taken effect immediately without awaiting that approval because of the urgency involved. Those 12 cases were taken from a total of around 311 prior approval cases. The same system will be put in place to deal with intrusive authorisations for police and customs activities under these provisions. I think that that should go some way to providing evidence that the system will not be abused.
The amendment would also impose a requirement on Secretary of State authorisations. They would not take effect until a surveillance commissioner had approved the grant of authorisation and written notice of the commissioner's decision had been given. We do not believe that that would be appropriate; rather, this is a skilful way employed by the noble Lord to raise again the issue of judicial warranting which we discussed during earlier debates in Committee. The surveillance commissioners have no locus in the activities of the security and intelligence agencies. We made our position clear on judicial involvement in the issue of warrants by the Secretary of State during discussions on Part I of the Bill.
Authorisation for intrusive surveillance by the security and intelligence agencies or the Ministry of Defence will occur in extremely sensitive cases. We believe that it is a key part of the line of accountability from the agencies and department to the Secretary of State. The involvement by the executive has historically reflected the highest levels of scrutiny. Any alternative means of authorising such operations would need to show that they would lead to an improvement on a system which has proved to be remarkably effective over many years. The place for judicial influence in this process is in the oversight role provided by the Intelligence and Security Service Commissioners.
I shall turn now to Amendment No. 125. The amendment allows the surveillance commissioners to add conditions to grants of approval. It should be remembered that the role of the surveillance commissioner is one of review. It is his function to review every authorisation for intrusive surveillance to satisfy himself that the decision was reasonable and that it met the criteria; that is, that it concerned serious

947
crime; that it was proportionate; and that the action it sought to achieve could not be achieved by other means.
If the surveillance commissioner agrees that the decision was reasonably made, he will approve it. If he does not believe that the decision was reasonable, he will cancel or quash the authorisation. We do not believe that it is his role to second-guess the authorising officer or to impose extra conditions on the authorisation. Authorisations are fundamentally operational decisions, best left to those most qualified to take them. It will be the authorising officer who, at the end of the day, is accountable for that decision and will have to justify it, if necessary, in court. However, nothing can prevent the authorising officer himself from attaching conditions or limitations on who, how, when, where or what kind of surveillance may be undertaken.
Amendments Nos. 127 and 132 would require the surveillance commissioner to give prior approval to Security Service intrusive surveillance authorisations which were granted on serious crime grounds. We believe that they are moving in a similar direction to the amendments that we have just discussed. For the same reasons, we do not believe that the amendments would he appropriate. They would represent a movement towards judicial warranting, with which we do riot agree. Furthermore, they would undermine, to a certain extent, a central element in the accountability of the Security Service to the Home Secretary.
We cannot accept Amendments Nos. 128 to 131. It is worth bearing in mind that all the surveillance commissioners are serving or former High Court judges. This should continue to be the case for all those commissioners involved in intrusive surveillance authorisations. There are clear statutory powers for the commissioners to quash and cancel authorisations. Furthermore, there are clear powers for them to order the destruction of records when they consider that to be appropriate. We are referring to senior judicial figures; the issues involved may well be complex; we believe that it is right to leave the discretion in their hands.
Finally, Amendments Nos. 135 and 136 would reduce the length of time a warrant can be granted or renewed for intrusive surveillance carried out by the intelligence services from six to three months. The investigations carried out by these agencies differ from those carried out by the police and customs. They tend to be for long-term investigations involving national security and the economic well-being of the UK. We believe that a six-month warranting system for such operations is right and appropriate. The difference is reflected in the differing lengths of authorisations for interference with property under the Intelligence Services Act and the Police Act. Those differences should remain.
The noble Lord was right to bring forward these amendments in order to test the Government on whether what has been put into the Bill so far is absolutely right. We believe that the new regime sits
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well alongside the existing set-up in the Police Act and the Intelligence Services Act, and I hope to some extent that I have reassured the noble Lord.
Lord Hylton: While we are still debating Clause 30, I understand that the senior authorising officers will be taking operational decisions, and that in nearly all cases they are individuals who are heads of their force or branch. However, in subsection (5)(1) at the bottom of page 33, the designated Customs officer can be "any customs officer" designated by the commissioners. How many Customs officers would be expected to be designated? Also, will he define more closely the phrase, "economic well-being of the United Kingdom". I suspect that I ought to know the answer. The noble Lord has perhaps defined it several times already. If that is the case, I apologise to him.
Lord Bach: If the noble Lord will forgive me, 1 do not intend to return to that issue, particularly when we have a large number of amendments to get through. If he will be kind enough to look in Hansard at some of our early debates in Committee, he will see that there was a debate on what that phrase means. I believe it was on the first day of Committee.
So far as concerns Customs, the noble Lord is right. Authorisation for intrusive surveillance is by a chief officer, but also, except in urgent cases—and this is very important—with the prior approval of the surveillance commissioner. Only in urgent cases can that chief officer give authority. In most cases it will be done only with the prior approval of the surveillance commissioner.
The noble Lord asked whether any designated Customs officer will do. The answer is no: the code of practice, which, I am happy to say, is due to be published in draft form before the Report stage, will limit this provision to the chief investigation officer and deputy chief investigation officer before authorisation. No one else will be allowed to do it.
Lord McNally: I commend to the noble Lord, Lord Hylton, a reading of the Bassam definition of "economic well-being". I am sure that it has already reached most of the economic textbooks.
I make no apologies for putting forward these amendments. I think that, sometimes, Parliament is cowed at the thought that the security services, the "spooks", are involved, and we are all supposed to suspend judgment. While I fully respect the work that our security services do, it is important that Parliament continues to scrutinise the powers that we grant them and how they use those powers. That was the spirit in which the amendment was moved and I shall read the Minister's reply with care. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30, as amended, agreed to.
Clause 31 [Rules for grant of authorizations]:
Lord Bach moved Amendment No. 124A:
Page 34. line 36, leave out ("or of the City of London police force") and insert (", of the City of London police force or of a police force maintained under or by virtue of section 1 of the Police (Scotland) Act 1967").
The noble Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 31, as amended, agreed to.
Clause 32 [Grant of authorisations in the senior officer's absence]:
Lord Bach Lord Bach moved Amendments Nos. 124B and 124C:
Page 36, line 7, at end insert—
("( ) a person is entitled to act for the chief constable of a police force maintained under or by virtue of section 1 of the Police (Scotland) Act 1967 if he holds the rank of assistant chief constable in that force;").
Page 36, line 45, at end insert ("or section 5(4) of the Police (Scotland) Act 1967").
The noble Lord said: I have already spoken to these amendments. I beg to move them en bloc.
On Question, amendments agreed to.
Clause 32, as amended, agreed to.
Clause 33 [Notification of authorisations for intrusive surveillance]:
[Amendment No. 125 not moved.]
6.15 p.m.
Lord Lucas Lord Lucas moved Amendment No. 126:
Page 37, line 32, leave out subsection (6).
The noble Lord said: I beg to move.
Lord Bach: It is important that public authorities have a statutory basis for carrying out covert activities as soon as possible and that provisions are in force before the Human Rights Act is implemented on 2nd October this year. This is necessary to safeguard the use of these valuable techniques by law enforcement and other agencies. The police and Customs will not be able to use the provisions relating to intrusive surveillance until an order has been made detailing the information to be contained in notifications to surveillance commissioners.
Such orders will be subject to parliamentary approval. However, in order to allow such an order and rules to be made by the Secretary of State in the absence of Parliament between the period when the Bill receives Royal Assent and Parliament reconvenes after the Summer Recess, the initial order has been made subject to the 40-day rule. This means that the initial order, and only the initial order, can be made without Parliament's prior approval. It would, however, need to be approved by Parliament within 40 days of being signed. The fact that the order in question will still require parliamentary approval is an important consideration.
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Most important of all is the fact that the Committee on Delegated Powers and Deregulation has considered this provision. Its report considers both the provisions and the parliamentary procedure provided for them to be appropriate. We place much store by that, as I am sure will the committee. We have tabled some amendments in response to its provisional recommendations. I hope that the noble Lord will withdraw his amendment.
Lord Lucas: I am grateful for that explanation. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 33 agreed to.
Clause 34 [Approval required for authorisations to take effect]:
[Amendments Nos. 127 and 127ZA not moved.]
Lord Bach Lord Bach moved Amendment No. 127A:
Page 39, line 28, at end insert ("or
(iii) a chief constable of a police force maintained under or by virtue of section 1 of the Police (Scotland) Act 1967,").
The noble Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 34, as amended, agreed to.
Clause 35 [Quashing of police and customs authorisations etc.]:
[Amendments Nos. 128 to 131 not moved.]
Clause 35 agreed to.
Clauses 36 to 38 agreed to.
Clause 39 [Secretary of State authorisations]:
[Amendment No. 132 not moved.]
Clause 39 agreed to.
Clause 40 agreed to.
Clause 41 [General rules about grant, renewal and duration]:
Lord McNally Lord McNally moved Amendment No. 133:
Page 44, line 25, leave out ("twelve") and insert ("three").
The noble Lord said: This and Amendment No. 134 are wing-clipping and probing amendments. Twelve months seems rather a long time for powers to remain in existence. I beg to move.
Lord Bach: To reduce the length of an authorisation for the use of a covert human intelligence source from 12 to three months is unnecessary and would place great demands on public authorities that use sources in their everyday work.
The use of a covert source is a long-term activity that needs to be authorised for a longer, rather than a shorter, period of time. Informants and agents can take a long time to build up a relationship or to elicit a particular piece of information. We think that 12 months is about right as a sensible gap between authorisations, and there are extra safeguards in the Bill in recognition of this relatively lengthy authorisation period.

951
The Bill requires that there should be at least two officers with responsibility for looking after each source. One should be responsible for the day-to-day care and for the security and welfare of the source. A second will have responsibility for a more general oversight of the use of that source. A person within the authority will have responsibility for maintaining a record of the use made of the source, and the information to be contained in those records will be the subject of regulations by the Secretary of State. Those extra safeguards are necessary because of the 12-month authorisation period.
Because authorisations last longer, Clause 41(6) directs an authorising officer to particular matters for consideration at the time of renewal. But, as can be seen from the detail of these extra requirements, they are specifically aimed at issues that may arise in respect of the use of a covert source. The idea that these safeguards might also work in respect of surveillance is misguided. Also, the shorter period for surveillance authorisations makes such extra safeguards slightly less necessary. We do not believe that the amendment could work in practice.
Viscount Astor: We on this side of the Committee feel that three months would be far too short. It would involve excessive paperwork and excessive bureaucracy for the authority concerned.
There may be a case for a slightly shorter period; the noble Lord, Lord McNally, might consider six months. However, in the light of what the Minister has said it is clear that it is quite a long-term matter, and to have to come back every three months would be an excessive burden.
Lord McNally: Against such an array of judgment,
I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 134 not moved.]
Clause 41 agreed to.
Clause 42 [Special rules for intelligence services authorizations]:
[Amendments Nos.I35 and 136 not moved.]
Clause 42 agreed to.
Clause 43 [Cancellation of authorizations]:
Lord Bach Lord Bach moved Amendment No. 136A:
Page 47, line 22, at end insert ("or
(iii) a chief constable of a police force maintained under or by virtue of section 1 of the Police (Scotland) Act 1967,").
On Question, amendment agreed to.
Clause 43, as amended, agreed to.
Lord Bach Lord Bach moved Amendment No. 136B:
After Clause 43, insert the following new clause—

Regulation of Investigatory Powers Bill

  RESTRICTIONS ON AUTHORISATIONS EXTENDING TO SCOTLAND
  (" .—(1) No person shall grant or renew an authorisation under this Part for the carrying out of any conduct if it appears to him—

  (a) that the authorisation is not one for which this Part is the relevant statutory provision for all parts of the United Kingdom; and

  (b) that all the conduct authorised by the grant or, as the case may be, renewal of the authorisation is likely to take place in Scotland.

  (2) In relation to any authorisation, this Part is the relevant statutory provision for all parts of the United Kingdom in so fir as it—

  (a) is granted or renewed on the grounds that it is necessary in the interests of national security or in the interests of the economic well-being of the United Kingdom;

  (b) is granted or renewed by or on the application of a person holding any office, rank or position with any of the public authorities specified in subsection (3);

  (c) authorises conduct of a person holding an office, rank or position with any of the public authorities so specified;

  (d) authorises conduct of an individual acting as a covert human intelligence source for the benefit of any of the public authorities so specified; or

  (e) authorises conduct that is surveillance by virtue of section 45(4).

  (3) The public authorities mentioned in subsection (2) are—

  (a) each of the intelligence services;

  (b) Her Majesty's forces;

  (c) the Ministry of Defence;

  (d) the Ministry of Defence Police;

  (e) the Commissioners of Customs and Excise; and

  (f) the British Transport Police.

  (4) For the purposes of so much of this Part as has effect in relation to any other public authority by virtue of—

  (a) the fact that it is a public authority for the time being specified in Schedule (Relevant public authorities), or

  (b) an order under subsection (1)(d) of section 39 designating that authority for the purposes of that section.

  the authorities specified in subsection (3) of this section shall be treated as including that authority to the extent that the Secretary of State by order directs that the authority is a relevant public authority or, as the case may be, is a designated authority for all parts of the United Kingdom.").
  On Question, amendment agreed to.
  Clause 44 agreed to.
  Clause 45 [Interpretation of Part II]
  Lord Bach Lord Bach moved Amdt No. 137:
  Page 48, line 5, leave out ("(5)") and insert ("(5A)").
  On Question, amendment agreed to.
  [Amendment No. 138 not moved.]
  Lord Bach Lord Bach moved Amendment No. 138A:
  Page 49, line 6, leave out subsection (7).
  On Question, amendment agreed to.
  Clause 45, as amended, agreed to.
  Clause 46 [Notices requiring disclosure of key]:
  Lord Lucas Lord Lucas moved amendment No. 139:
  Page 49, line 35, leave out (", or is likely to do so").
  The noble Lord said: Here we come upon a clause that the Government have been kind enough to rewrite extensively and at the very last moment. I cannot pretend that I or anyone that I have talked to has had time to comprehend the details and effects of all these changes. Therefore, I intend to use my comments on this and subsequent amendments to explore what the Government have done and where we are now. It may be necessary. with the help of my colleagues on the Front Bench, to ask for a recommittal of this clause when we have had time to absorb the effect of all the changes, but for now I await advice and information from the Minister with great interest.
  This whole clause is extraordinary. It addresses a problem that the Government imagine they might find their agencies in from time to time of being unable to decrypt information. In all the years that cryptography has been available, there has been only one case in the United Kingdom in which the Government could not decrypt all the files they needed on one particular pornographer's hard disk.
  It is extraordinary that so much damage should have been done worldwide to the reputation of the United Kingdom as a place to do e-business, with anxieties and recriminations echoing round the globe from international lawyers to those who specialise in the Internet. I hope that we may reach a point with the Bill where we are able to allay some of the fears, but it will take a long time for all the damage that has been done to die away. It is extraordinary that it should be done, when there is so little need for this clause as a whole.
  Encryption is in theory perfect. One can hide anything in a way that cannot be broken. Even if the clause were enacted in the way in which it was originally written, before the Government's latest amendments, it would be possible to hide anything one wanted. Internet communications will use ephemeral keys, and there will be no way of breaking that system. Cryptography has evolved in ways which have built-in deniability. The whole way in which the clause has been written assumes that there is only one key, which will reveal one set of information out of an encrypted file. But it is very easy to create a system whereby out of an encrypted file I can produce a Shakespeare sonnet or an order for hard drugs, depending on which key I use to unlock it. There is no way in which the Government can prove that there is a second key if I produce to them a first key.
  One can hide whole file structures. One can hide the existence of files through the use of keys that go down in layers, so that the first key will reveal one file structure, but if one applied another key it would reveal hidden files below. If one uses suitable methods of hiding the files it is impossible to prove that the files even exist.
  Cryptography using one-time pads is a technique we can remember from the war years. That is in theory perfect. There are still wartime codes that have not
  954
  been broken because the one-time system was used perfectly. There is now the practice, which will doubtless be used more in future, of using data havens, of storing one's data remotely. Again, as long as one takes care to encrypt and hide one's links to it there can be no way of proving that one has it.
  We are up against a system that is technically perfect, and the sort of attack envisaged by the Government will be useless against the serious and careful criminal. The sort of attack that works in practice, that has worked in all but one case to date, results from the fact that anyone doing cryptography is human, that hiding one's data in a consistent way is extremely tedious, and that people tend to take short cuts, and either as a result, or through the methods outlined in Part II—and there are plenty of them that can be used with computers—one can uncover the keys and the information needed to break people's cryptographic systems without going at it in the way envisaged in this part of the Bill.
  What really frightens people about the way in which the clauses are drafted is that because they will be pretty useless against the serious criminal they will be used only against casual traffic, and, more important, will be available for use against messages received and communicated by substantial international businesses. Anyone who uses the Internet, which is essentially an open system—there is nothing secure about it—must use a high level of cryptography and assure clients, customers and associates that his systems are secure. Anything that puts that in doubt or makes business believe that by conducting this activity in the UK it lays itself open to international law suits or merely produces a loss of confidence that data stored in the UK is not as secure as data stored in a country which is not governed by this kind of legislation, even with the latest government amendments, will result in a substantial loss of business to this country.
  I do not believe that business has had time to react to, and review, the latest amendments. We shall wait and see how it reacts to them and to today's debate. If, as I fear, the conclusion is that the Government have not gone nearly far enough, as suggested in today's Financial Times, we should either excise the clause from the Bill or insert a provision to say that it shall not come into effect until a further measure has been passed to authorise its implementation. A method must be found to ensure that the Government have those parts of the legislation that they require to comply with the Human Rights Act for the activities that they currently undertake but are denied the ability to trespass into areas where they have no present need to be, potentially at great cost to the UK's international business and its economic wellbeing, to use the famous definition. We should not imperil that for so little gain. If more time is needed to consider this matter and produce something with which everyone is content, we should provide the Government with a mechanism whereby that end can be achieved.
  The amendment excises the words "or is likely to do so". That wording occurs also in several amendments to the subsections to Clause 46 tabled by the noble

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  Lord, Lord McNally. 1 believe that I see what the Government intend. They want to be armed with an authorisation to demand the key if they find an encrypted file when they search someone's premises. I understand that. However, in effect the way that the provision is written means that they can demand the key to future communications that arrive in the course of the next few days. Therefore, any business that is subject to such a demand must keep its whole cryptographic system open for the investigating authorities. It must leave a gaping wound, as it were, in its security until the investigating authorities say that it can be closed. There is no way to supply the text of messages yet to come; one must supply the key. To leave in this particular phrase is very much against the spirit of what the Government say they want to achieve in tabling their new amendments unless the wording can be tightened up to cover a much shorter timescale and allow the authorities access only to files which they are about to discover in premises that they are about to raid. I beg to move.
  6.30 p.m.
  Lord McNally: I agree with much of what the noble Lord said. I added my name to the amendment because, as presently drafted, the provision seems to be "future proofing" gone mad on the part of the Government, as the noble Lord explained in his concluding remarks.
  To save a repetitive speech, we have arrived at the crux of the Bill in terms of clearing the hurdle of business disquiet. We must all assess whether what the Government propose in Clauses 46 and 47 meets the concerns of business. I was interested in the initial reaction of one of the companies concerned, Vodafone. Its concern was that in seeking a proportionate response, to use a favourite expression of the noble Lord, Lord Bassam of Brighton, the provision leant too far towards the requirements of the relevant authorities and failed to take account of the needs of the businesses in question. A good deal of the debate on the clause will revolve around the question whether the powers that the Government seek are proportionate in terms of the real or imagined evils that they seek to counteract and the burdens that they place on business.
  I am not one of those who believe that the new cyberspace technology is a zone that should be outside the rule of law. I still have sufficiently strong confidence in parliamentary democracy to believe that, as a necessary protection, all parliaments should be able to construct a framework within which people conduct their activities. I am not a member of the "cyberspace tendency" which believes that this is all beyond us. Who knows? Perhaps those countries which have not yet grappled with a legislative framework for e-commerce will regret it or look at our attempts as pioneering work in the field.
  I hope that both sides will approach this matter in a constructive way. Industry, which has quite legitimately lobbied and stirred up media and political and parliamentary interests and obtained a response from the Government, should take a proper look at
  956
  what this means for business. I also hope that, having emerged from its tetchy phase, the Government are now willing to listen to industry if further constructive points can be made. The context in which the noble Lord moved the amendment was extremely wise and constructive. If both sides approach this part of the Bill in that way we shall produce clauses that are acceptable to industry and provide a legislative framework for e-commerce in future.
  Lord Cope of Berkeley: I entirely agree with the general points spoken to by my noble friend Lord Lucas. So far this Bill has of itself been extremely damaging to Britain's interests because of the perceived threats that it poses. Even if in the course of debates we make amendments which produce a Bill that is 100 per cent acceptable some of that damage will remain. I do not want to expand too much on that point at this stage, but I firmly believe that that is the case.
  The aim of all concerned, including the Government, should be to amend the Bill so as to minimise the damage that has already been done and the damage that will arise in future. Part of the difficulty arises from the fact that the Government have been determined that we should be pioneers in this matter. I am all for Britain being a pioneer in e-commerce, and all to which that relates—the Government say that they are in favour of that too—but I am not in favour of Britain being a pioneer in threatening e-commerce. That is what the Bill as originally drafted did; and to some extent still does.
  Keys, encryption and security are important to the Internet and every kind of e-commerce. At the most basic level, if I buy, as I have done occasionally, some item on the web and feed in my credit card number, I need absolute confidence that that number will not leak from the company selling to me over the Internet, otherwise I shall not buy from it; I shall use some other method. However, at the more elaborate levels of commercial and banking contracts, that concern is multiplied to a far greater importance. That is why the banks and commercial companies and organisations have been so sensitive about this section of the Bill
  I am not so alarmed by the phrase "is likely to do so" as the Liberal Democrats. If we are trying to gain information about an individual who is suspected of being, for example, a money launderer, and he is the customer of a specific bank, it is not unreasonable for the authorities to say to the bank, "We believe that you have in your possession the documents relating to the transactions already carried out by the suspect. We need to see what was said in those and future documents when he has further transactions". It is that kind of case that I believe those words cover.
  The noble Lord, Lord McNally, referred to real or imagined evils to be countered by these powers. Although sometimes the suspects may prove not to have done anything wrong, I believe that there are some very real evils to be countered. That is why it is necessary to provide the correct powers which will give safeguards. Nevertheless, we need those powers.

  957
  Because of the way in which the Bill has been prepared, this new dimension concerning the Internet, and so on, has had to be added on to the rewriting of the existing telephone tapping and surveillance provisions owing to the imminent arrival of the Human Rights Act. To disentangle them, or to put a hold on the Internet provisions until they are further refined, I believe would be desirable. Unfortunately, the powers are not in one single part of the Bill; they appear throughout. That makes it difficult to deal with them. Nevertheless, perhaps the Government could find a way to leave the Internet provisions on the shelf for only a relatively short period of months while we try to get them right. We need them, but they must be the correct provisions if we are not to destroy the British advances in e-commerce and lose the advantages that we have.
  6.45 p.m.
  Viscount Goschen: The noble Lord's amendment serves as an excellent introduction to the part of the Bill which has caused perhaps the most controversy. The issue of encryption goes to the heart of the Bill. It sums up the concerns of the industry.
  We are not talking only about e-commerce, the new media industry, but about any international business which wants to operate, has existing operations or aims to set up business in the UK. A recurring theme has been globalisation. It is increasingly easy for companies to locate business where the environment is most conducive for them. There is no doubt that the issue of access to encryption keys causes severe worries among a number of major corporations, not only those involved in e-commerce.
  At the beginning of the Committee stage, the Minister was good enough to say that he was in listening mode. He has been as good as his word—to the extent of rewriting the Bill for your Lordships' House. It will be difficult to disentangle the new provisions in the course of the Committee stage today. Direct questions need to be answered on the Minister's new provisions. We shall wish to return to a number of elements on Report.
  As regards the amendment, it is important to emphasise the degree of concern which surrounds this area. We welcome the moves the Government have made in a constructive spirit. However, the measure will require further examination to see what needs to be done.
  Lord Bassam of Brighton: I start with an observation on the words of the noble Viscount, Lord Goschen. Throughout the Bill I have sought to be constructive and to offer constructive opportunities to all to make intelligible and intelligent criticisms. We have invited in all sectors of business. To my knowledge, we have not said, "No, go away" to anyone. That approach has now been widely acknowledged. Therefore, when the Government are criticised for extensively rewriting the Bill, or for putting forward provisions at the very last moment, it is because we have been listening—as we
  958
  always said we would—and there is no other time when we can make these changes. I am sure that Members of this House will recognise and understand that.
  Viscount Goschen: I complimented the Minister; I did not criticise him. However, I do not extend that compliment to his colleagues in the Home Office who have direct responsibility for this legislation. This Bill should never have come to either House of Parliament in the state that it has. Now that the Bill is here, I am pleased that the Minister takes note of concerns.
  Lord Bassam of Brighton: I am grateful for the compliment; I am prepared to live with it! I wish also to thank the noble Lord, Lord McNally, for imparting to us the knowledge that he still believes in parliamentary democracy. That was a valuable comment, was it not; otherwise why would we be here?
  Lord McNally: There is a serious point. People out there are telling us that this new technology is so footloose and fancy free that it is beyond the powers of parliamentary democracies to control. I put forward the strongly held view that it is not.
  Lord Bassam of Brighton: I entirely understand. I have heard that argument too; it is interesting.
  However, there is one consistent and recurring theme: that in bringing forward this legislation we have done some fundamental damage to this industry. I find it hard to accept that. I believe the legislation has been brought forward for entirely the right reason; that is, to find a sensible system of regulation. In doing that, the Government must listen to intelligent and well-founded criticism. The Government have tried to do that.
  The noble Lord, Lord McNally, referred to Vodafone's off-the-cuff criticism of the Government's moves thus far in bringing forward the amendments today. If Vodafone has further specific points it wishes to put, the Government will continue to listen. The Government do not claim that they are absolutely right, although they believe that they are. Nevertheless, the Government want to ensure the best legislation; legislation that works to the better interests of industry and government, but more particularly industry because that is wealth-generating and is for the good of the country's economy.
  I turn to the amendments spoken to by the noble Lords, Lord Lucas and Lord McNally. I listened to what was said about, in particular, the comments made by the noble Lord, Lord Lucas, and I shall work through those observations. In particular, I noted the point made by the noble Lord, Lord Cope. That was a very constructive response to that particular clause.
  It is understood that the objection is the futuristic element. If that futuristic element were to be removed, the Government believe it would have a detrimental effect on the practical use of decryption power. The noble Lord, Lord Lucas, asked whether the power was required at all. The Government believe that it is. The

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  noble Lord probably believes it is required, but only in very tightly restricted circumstances. That is where the debate is and it is to be hoped that at the end the Government will have got it right.
  If the amendments were to succeed they would very much limit the effectiveness of the decryption power. The Government resisted such amendments in another place because of that concern.
  It is recognised that there is a futuristic element in Clause 46(1)(a) to (e). The concern is understood to be that that would permit what are colloquially termed "fishing expeditions" for keys, perhaps long-term keys to future information. The Government believe that there is no such effect and I shall try to clarify why. First, it is important to remember that the decryption power may be authorised only in respect of particular protective material which has been or is likely shortly to be lawfully obtained, so it is very closely defined.
  The Bill does not permit the power to be used solely for speculative fishing for keys. The Government believe Clause 46(1)(a) to (e) is needed for cases where there are reasonable grounds for anticipating that, for example, a suspected criminal is using encryption to protect material, and reasonable grounds for believing that the location of the relevant key to that material is known. In such instances, the futuristic element allows an agency to apply for the power to serve a Clause 46 decryption notice at the same time as an application is made to use the underlying power to lawfully obtain the material in question.
  Perhaps I may give an example. It is entirely conceivable that there will be cases where the police have very reasonable grounds for believing that an individual is using encryption; for example, a suspect in a criminal investigation. The police could apply to the court for a warrant to search his premises. Therefore, the Government believe it right that the police should be able to apply for authority to serve a decryption notice at the same time as they apply for a search warrant. Clause 46(1)(a) allows that.
  Similar considerations apply in other instances as set out in Clause 46(1) where use of the decryption power may be authorised. It is conceivable that there could he reasonable grounds for anticipating that encryption will be encountered in all the circumstances where the Bill permits decryption power to be used. That is why the futuristic element is included in Clause 46(1)(a) to (e).The proposed amendments would mean that an application to the relevant authority, be it a judge or the Secretary of State, for the power to serve a decryption notice could be made only after the encrypted material had actually been obtained under the warrant. Clearly, that could lead to critically damaging delays in what might be a very fast moving investigation. It is not believed that that is the intention in promoting these amendments, but that would, nevertheless, be their effect. The Government would therefore argue that for those reasons the futuristic element is necessary. Members of the Committee who proposed the amendments are invited to take careful consideration of the impact of removing that part of the Bill.
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  The Government do not say that the Bill permits fishing expeditions. That is not our intention. I want that to be clearly understood and on public record. The Government have carefully explained this to industry, not least the Institute of Directors, which quite rightly and understandably raised the query. It is hoped that with that explanation Members of the Committee who brought forward the amendments will feel able to withdraw them.
  Lord Lucas: The noble Lord, of course, makes a very good point with which I entirely agree. I hope I said that in my opening speech. But where the police are about to raid someone's premises, or an equivalent venture is about to be undertaken, it is very sensible that the police should take a Section 46 warrant with them so that they can pick up the key at the same time they pick up the information. If these subsections were directed at that, it is not believed that they would cause any difficulty.
  What causes difficulty is what the wording would allow; for instance, that part of the Bill relating to the interception of communications and the application for a warrant in advance of the communications. A person may go to a bank and say, "This person may be sending messages to you using your public key, and we therefore need to have your private key to decrypt them. We expect the messages to come in over the next couple of weeks, so you must keep your public key the same". That would be an extremely damaging position for a bank. That is what industry and I—and, I hope, the Government—would, on contemplation, find unacceptable. It is limiting the scope and timescale of the measure. It would allow exactly what the noble Lord first described, but it would not put industry in a position where its security system could be opened up and kept open. That is very much the import behind my argument. I do not believe that that question has been answered, and unless the Minister has any further comments to make we shall return to the matter at a later stage of the Bill. Unless anyone else wishes to intervene, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord McNally Lord McNally had given notice of his intention to move Amendment No. 139WA:
  Page 49, line 38, leave out (", or is likely to do so").
  The noble Lord said: Our concern remain the long-term key which is the open door and the one which undermines confidence both in business and in civil liberties. It is believed that we shall return to the matter, and therefore I shall not move my amendment.
  [Amendment No. 139WA not moved.]
  [Amendments Nos. 139XA to 139ZA not moved.]
  The Earl of Northesk The Earl of Northesk moved Amendment No. 139A:
  Page 50, line 5, at end insert—
  ("( ) If any person with the appropriate permission under Schedule 1 believes on reasonable grounds—

  (a) that any person is able to put the protected information into an intelligible form,

  (b) that the imposition of a requirement to disclose the information in intelligible form, or to disclose the key to the protected information, is—

  (i) necessary on grounds falling within subsection (3), or

  (ii) likely to be of value for purposes connected with the exercise or performance by any public authority of any statutory power or statutory duty,

  (c) that the imposition of such a requirement is proportionate, taking into account the full consequences of its disclosure, to what is sought to be achieved by its imposition,

  (d) that the information in intelligible form, or the key, cannot reasonably be obtained by the person with the appropriate permission without the giving of a notice under this section,

  the person with that permission may, by notice to the person whom he believes to be able to put the protected information into an intelligible form, require the disclosure of that information in an intelligible form, or, in the circumstances provided for in section 47, the disclosure of the key.").
  The noble Earl said: At the outset, without a hint of criticism, I express both gratitude for and appreciation of the amendments the Government have tabled to this part of the Bill. They go some way towards meeting the concerns which have prompted me to table my own amendments in this group. My own view has always been that if we must have key disclosure, the correct methodology to apply is one where efforts to obtain plain text are properly exhausted before keys are sought.
  Here I echo the complaint of the noble Lord, Lord Lucas, and promote the thought that recommitment of that part of the Bill should be actively and seriously considered. There has not been time fully to consider these amendments. The revised versions of the relevant clauses were received at approximately six o'clock this evening. I retain a host of reservations, but it may be that the Minister's explanations will ameliorate those.
  Therefore, rather than launch into an exposition of my amendment, it seems to me that the most helpful and useful service I can offer the Committee is to invite the Minister to explain those of the Government. Realistically, they are the substantive business in the grouping. I cannot help feeling that that would make for a tidier debate and I trust that it meets with the approval of the Committee. I beg to move.
  Lord Hylton: When the noble Lord, Lord Lucas, moved an earlier amendment, he went so far as to say that he thought the clause would be useless against serious crime. I apologise if I have overstated his remarks; I hope that I have not.
  It would be helpful if the Government could say whether they agree or disagree with that position. If they disagree, can they say why?
  7 p.m.
  Lord Bassam of Brighton: I thank the noble Earl, Lord Northesk, for his tactful intervention and helpful observations. I shall move through an analysis of our amendments and comment on all the Opposition amendments.
  The group of amendments covers a big question: when should the authorities be permitted to require that a decryption key be disclosed rather than simply the plain text of protected material? The associated issue is whether a party in receipt of a notice should be able to choose which key to disclose, if there is more than one which can carry out the necessary decryption. That is an important, but nevertheless secondary, question.
  I recognise that this is a crucial issue, especially for industry. We have received a number of representations on the issue from the British Chambers of Commerce and the Institute of Directors. We have tried to allay their concerns by explaining just what the Bill actually states and what it seeks to achieve. We have also received helpful correspondence not least from the British Bankers' Association setting out its understanding of the way in which Part III of the Bill works. In the light of those representations, we have decided to recast these provisions. I fully accept that Members of the Committee will have to retreat and take time to study them in order to understand their impact more precisely.
  In recognition of the views of industry, we made wide changes to Clause 47 in another place to add an extra test if keys are to be required. That was welcomed and Members of the Committee have proposed further changes. We have suggested our own amendments, which take account of the views of industry and cover the majority of points raised by the Committee.
  Before addressing these changes, I should clarify one existing point on the keys versus plain text issue. In the Bill as drafted, there is already an extra test if keys are to be demanded. Imposing a direction that a key be disclosed is limited by Clause 47(4) to occasions where it is believed that there are "special" circumstances of the case making that necessary; and that imposing such a requirement is believed to be proportionate to what is sought to be achieved by so doing. I hope that that is clear: plain text first; extra test if keys are required. That is the important message which we must get over. If a key is required, the choice of which key to disclose, if there is more than one, rests with the recipient of the notice. The definition of "key" in Clause 52(1) applies. It could be a session key, a short-term key or a long-term key. The choice rests with the recipient of the notice and that is the important qualification which must be widely understood.
  That is the position now. But, as I have said, parts of industry have voiced some concerns and asked whether we could find a way of giving greater prominence in the Bill to the disclosure of plain text and clarifying the issue over the choice of keys. Your Lordships' amendments in this group address those very points. We have listened to the genuine views we

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  have received and have sought to rework Clauses 46 and 47 ourselves. The government amendments before the Committee are the result of that reworking.
  The amendments we have tabled in the group seek to recast Part III in terms of our preference for plain text rather than keys; and to leave it up to the recipient of a notice to decide how to comply with a disclosure requirement. It is on trust.
  We believe that the changes will be welcomed. We were certainly told by industry that such amendments would offer reassurance. Amendment No. 139D begins by recasting Clause 46 as a,
  "disclosure requirement in respect of the protected information".
  The existing necessary and proportionate tests for the use of the power remain with the reasonableness test amended to reflect the new structure, to which Amendment No. 141B refers.
  Amendments Nos. 114A, 114D, 114F and 153B follow suit by making reference to "disclosures" rather than to "keys". Amendment No. 158B inserts a new clause which, again, represents a restructuring to underline the preference for plain text. The remaining government amendments in the group— namely, Nos. 159C, 161 A, 171A, 183A to 183C, 195B and 225A—are consequential changes arising out of the recasting of Clause 46.
  The point is that we have listened to industry's concerns and recast Clause 46 to provide reassurance. Disclosing the plain text of material will normally suffice and it is up to the recipient of a notice to decide how to discharge the disclosure requirement. The issue is disclosure, not key.
  I believe that our amendments sweep up the majority of the concerns expressed by Members of the Committee, but a couple are left. These, too, cover some important points and provide me with an opportunity to clarify the Government's thinking.
  As I see it, these remaining amendments are, first, Amendment No. 158C, which would mean that a requirement to disclose a key could be given only by a Secretary of State or judge where there are exceptional circumstances to the case. Amendment No. I64A would do something similar by replacing the existing Clause 47 and would impose further restrictions on the circumstances when a key—as opposed to the plain text—-may be demanded. Amendment No. 163 seeks to widen the considerations which must be taken into account in deciding whether it is proportionate to demand a key.
  Let me take those in turn. Amendments Nos. 158C and 164 would both place further restrictions on the circumstances when a requirement to disclose a key might be imposed. I believe that both would prove too restrictive in practice. Both set the test that there must be "exceptional" circumstances to a particular case.
  As we indicated in another place, we gave very considerable thought to putting in such a test ourselves, but we concluded that in practice that might prove to be too restrictive, with the potential to undermine the effectiveness of the power.
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  That matter was debated at the Report stage in another place, but perhaps I may explain it again. In the case of decryption requests made to legitimate businesses, a requirement to disclose a key, where the plain text is available, would certainly, it seems to me, be most unusual. The difficulty for the law enforcement agencies surrounds the use of the power against those suspected of involvement in criminality. In these cases—where there may be doubt about the bona fides of the person being served with a notice—requests for keys may perhaps be more frequent. The future is uncertain and we cannot know how often this might arise. But Clause 47(4), as drafted, limits the power to demand a key; and the case must be a special one. We believe that that is the most appropriate test.
  The limbs at paragraphs (b) and (c) and the timing point at subsection (2) of Amendment No. 164 are exactly the kind of considerations that will need to he gone through with the existing Clause 47. However, we believe that the cumulative effect of the way that the amendment works is too restrictive.
  In resisting the amendments, it may be helpful if I clarify again our thinking on keys. We have narrowed down on the face of the Bill the circumstances in which a key can be required to be disclosed. We have imposed an extra test and that has been welcomed. Members of the Committee may ask legitimately what kind of case we might consider to be special.
  As I indicated elsewhere, we shall cover that issue in the code of practice, which should be available before Report. However, I believe that it may be useful if I offer some illustrative examples. First, trust, to which I have referred already, becomes an issue when there is doubt about the bona fides of the person or body being asked to provide the plain text. In a criminal investigation, for example, law enforcement agencies will need to be sure that the plain text of protected material is the correct text, otherwise doubts could easily be cast in court during a future prosecution on the veracity of the information.
  The second example relates to timeliness. In some surveillance operations which involve interception, for example, it may be imperative for the ongoing decryption of protected material to take place in real time, or as close to that as possible. Potentially, delays could be life-threatening, and I am sure that we can imagine circumstances in which that may be the case. If whoever has the key to protected material cannot carry out the decryption quickly enough in time-critical operations, but the authorities can, it may be considered necessary to ask for a key. I believe that that example is clear.
  I should stress that in certain cases there may be technical solutions to these problems; for example, where they affect the timeliness issue. However, the fact is that in some cases solutions—technical or otherwise—may not be available. Therefore, the Bill needs to have the flexibility to allow for keys to be requested, but only where special circumstances make that necessary and where it is proportionate to the aim of imposing such a requirement. I believe that that is an important balancing point.

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  Therefore, as are other parts of the Bill, Clause 47 is a reflection of the delicate balancing exercise that we are trying to effect in this area. I believe that in many ways we are trying to deal with a future danger. It is difficult, but we believe it to be entirely right that we do so. I would also argue that no responsible government could or should seek to do otherwise. I believe that it would be foolish of government to ignore that.
  We made changes to Clause 47 in another place because we are seeking genuinely to strike the right balance between providing effective powers and allaying industry and civil liberties reservations about the Bill. I believe that the current tests for requiring the disclosure of a key strike the right balance and that these amendments would tip that balance in the wrong direction.
  I believe that I may not have addressed fully Amendment No. 163 in my comments on the government changes. That amendment seeks to spell out one of the considerations which must be taken into account in deciding whether it is proportionate to demand a key. I understand the concerns of noble Lords but believe the amendment to be entirely unnecessary. The considerations that they seek are implicit in the proportionality test which is already in the Bill in Clause 47(4)(b). Why are keys needed? They are needed in order to put particular protected data into intelligible form; that is, to turn particular encrypted text into plain text. That is, after all, the whole purpose of the power.
  However, in deciding whether to require that a key be disclosed in a particular case, the person who authorises the power will need to address the question of proportionality in its widest sense. That includes considering what kind of key it is, what other information it gives access to, its commercial value and so on. We would be reluctant to accept the amendment lest it implies that other equally important considerations are somehow not relevant. However, I believe that there is nothing much between us on this issue. We must all remember that Clause 47 imposes an extra proportionality test; one is contained earlier in Clause 46(2)(c).
  Importantly, the safeguards provisions set out in Clause 52 also have an impact here. Clause 51(2) requires measures to be in place to restrict the uses to which keys may be put. Where keys are obtained, the authority concerned will not be permitted immediately to decrypt all manner of other communications or data belonging to the individual or organisation which provides the key. It would be unlawful for it to do so. As set out in Clause 46, there must be separate lawful authority to obtain the protected material in the first place.
  Perhaps I may suggest that we now consider the new situation. At present, if the police request electronic data from a bank, they will, for example, apply for an order under the Police and Criminal Evidence Act 1984 and serve it on the bank concerned. In return, the bank discloses the data together with a statement attesting to its bona fides. The police do not insist on
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  accessing the bank's computers in order to discover whether they are telling the truth. They rely on the bank's integrity and, where necessary, use them as witnesses. We envisage a similar scenario with regard to encrypted material. The exception to that might be where a bank itself was suspected of involvement in criminality.
  We have tabled amendments in order to meet industry concerns. I hope that they are welcome. If particular issues remain, we shall of course be happy to examine them to see whether we can offer further reassurance and remain consistent with our overall aims. In the meantime, I beg to move the government amendment in this group and, in the light of what I have said, ask Members of the Committee to withdraw their amendments.
  7.15 p.m.
  Lord Cope of Berkeley: As others have said, and as the Minister acknowledged, this important set of government amendments was tabled at the last minute. I should add at once that I believe it to be helpful to the Committee that the amendments were tabled. I do not criticise the noble Lord for deciding to do so at the last minute. At least we know the direction in which the Government's mind is moving, and, in fact, they have moved quite firmly in that direction. At the same time, I am sure the Minister will appreciate that it has made it difficult not only for the Committee but for others outside—to some extent, even more so for others outside—to read through the detail of the Government's amendment and to assess exactly what they are doing and whether it is sufficient.
  I should like to put on record that we have been much helped—at least, I have been much helped—by the ever-helpful Foundation for Information Policy Research, which earlier today put on the web a copy of how these clauses will appear if all the Government's amendments are agreed to. That makes for much easier reading than going backwards and forwards between the amendments. Not for the first time, the foundation has been of great help to us in assessing the way in which the clauses will affect the situation.
  The series of amendments tabled in my name and that of the noble Lord, Lord McNally, attempt to achieve something similar to that intended by the Government; that is, to put plain text in the front line and to allow applications for a key only when absolutely necessary. I accept at once that Clause 47, as it now is, contains the reservations to which the Minister referred. There is a difference in the wording and the Minister drew attention to that. Basically, the Government's wording continues to say that there need to be "special" circumstances, whereas we say that such circumstances should be "exceptional". That is a distinction, but I do not consider it to be as large a distinction as in some cases one might be led to believe.
  However, a point on which I should like to be clear—I must admit that I am not clear about it at present—is ultimately who authorises the attempt to obtain the key as opposed to the plain text in a particular situation. As far as I can see, the person

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  giving the notice does not have permission to insist on the key. Only the judge or the Secretary of State can order that the requirement can be complied with only by the disclosure of the key. That is the effect of the government amendments and those that the noble Lord, Lord McNally, and I have tabled. Given the drafting of Clause 47, the Government clearly agree on the importance of placing the production of keys in a significantly different framework from the production of plain text.
  There are some other detailed points relating to the amendments, but I have dealt with the most important issue. If the Minister could give us an assurance along the lines that I have asked for, it would help us to accept the clause. He may say that it is obvious from the clause as written, but it is not obvious to me.
  Lord McNally: I shall not go into great detail. From what the Minister has said, I think that we are close to an agreement, but we shall read Hansard and take wider advice.
  We seem to be putting the plain text at the forefront. We have been at pains to make sure that the acquisition of the key must not become a useful end in itself, because that would result in an open door, which has caused a great deal of concern. The Minister has reassured us and, as the noble Lord, Lord Cope, eloquently explained, that was the intention of our amendments.
  Lord Blackwell: Like other noble Lords, I listened to the Minister with great interest and appreciated his argument, but despite the welcome movement on plain text, there are still a large number of issues, both of principle and of practicality, on which I am not fully satisfied. The issues of principle are the broadest ones. Although it may seem reasonable to the man sitting in Whitehall for the Government to have certain powers for use in exceptional circumstances, that fails to take into account the perceptions of people outside and their fears about how those powers may be used. That goes to the heart of whether these clauses are appropriate.
  Leaving that to one side, there are other significant issues of practicality that have not been addressed, particularly on clause 46. They go back to some of the points that my noble friend Lord Lucas made. The word "key" is widely used in the Bill, and the amendments, as though we were talking about a key that could unlock something simply, like a door to a room. However, developing technology means that, in many cases, keys will not exist in that form. As I understand it, the dynamic generation of new keys may be ephemeral and it may not be possible after the event for somebody to say what the key was, because it was simply generated, used and destroyed.
  There are some practical issues that I do not yet understand. Do the Government believe that it is technically feasible after the event to ask people to give them information that will enable them to go back and decode messages that have been encoded and transmitted using such ephemeral keys? I am not sure that it is possible. If the Government think that it is, we
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  need to understand why, and how it can be achieved. If it is not technically feasible, the whole apparatus will fall flat on its face, because everyone will move t o those forms of encryption that cannot be caught under the powers in the Bill. Only the honest and the simple will be constrained.
  Even if it is technically feasible in a way that I do not understand, I am still not sure whether the language used in the Bill creates the powers to do whatever is necessary to understand enough about the systems that generate keys to give the Government the legal entitlement to find out how to decrypt messages. Whether the legal language in the drafting is right depends on the answer to the first question and whether there are technical solutions that will deal with ephemeral keys in particular.
  I do not necessarily expect an instant response, but before we conclude, we need to understand whether the Government have answers to the difficult questions on the principles and practicalities of the clauses. If not, there is a danger that the legislation will be merely tilting at windmills and none of the aims of the Bill will be achievable as technology moves on.
  Lord Lucas: I very much support what my noble friend Lord Cope has said. The important issue is the level of authorisation needed to obtain a key. If the authorisation has to come from a senior judge, people will take some comfort from the fact that it will happen only in exceptional circumstances. However, it might be that only the authorisation of an official is needed. How will the system work? Clause 46(1) allows the prospective key to be obtained in a wide variety of circumstances. Some information can be obtained only by having the key. If keys are going to be asked for frequently, it will be a tedious process if authorisation has to come from a senior level. To an extent, Clause 46(1) and the amendments rub against each other.
  The Government also need to address the issue of self-incrimination. If someone knows that the data that they have encrypted will incriminate them, how can they be made to reveal the key?
  Viscount Goschen: I welcome the thrust of the government amendments. Will the Minister tell us a little more about the special circumstances under which keys will be required?
  Putting plain text to the fore is a move forward. I am trying to test how much the Government believe their own arguments. If there is a circumstance in which an agency of government has to resort to law to compel a company to give its information, is it likely then to believe the plain text which is provided? It is rather like asking someone to search his own house and then tell the police what he found when they arrived. In what sort of circumstances does the Minister envisage that plain text would suffice? One can imagine a number of such circumstances; for example, where a trusted organisation was asked to reveal information, perhaps, about an employee who was considered to be suspect.

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  But does the Minister feel that that would be the case in the vast majority of circumstances? Whether or not this will work, as my noble friend Lord Blackwell, said, will the circumstances be so very special or will the Government use the excuse, as it were, that the plain text is just not good enough once the Bill is safely tucked away on the statute book?
  7.30 p.m.
  The Earl of Liverpool: I, too, express my gratitude to the Minister for the amendments that he has tabled, which may go some way towards allaying my fears.
  I shall refer to my Amendment No. 163, which is buried in this enormous group of 34 amendments. Where the surrender of keys is being demanded, it is essential that such demands should be subject to the appropriate tests of both reasonableness and—I use a favourite word of the Minister—proportionality. I am afraid that I did not have the advantage of seeing the government amendments at six o'clock last night. I saw them only this afternoon at about three o'clock. To what extent does he believe that his amendments have answered the concerns raised in my Amendment No. 163?
  The Earl of Northesk: Like other Members of the Committee, I thank the Minister for his full explanation. However, I hope that the Minister will forgive me if I take up a few points.
  I should say for the record that I acknowledge the benefit to be derived from the primary purpose of this part of the Bill. It is self-evident that, where criminal elements avail themselves of the use of the protection of encrypted electronic messages, there are strong arguments in favour of law-enforcement agencies having adequate and appropriate powers to access such protected information. I emphasise my use of the phrase "adequate and appropriate powers". Like many others, I remain unconvinced that the way forward is for the UK Government to take what I perceive to be unilateral action in this area. My personal belief has always been, and continues to be, that that would be better delivered by means of international agreement.
  The reasons are manifest. While my noble friend Lord Lucas has already elucidated them most eloquently, they bear repetition. First, the criminal fraternity will, in any event, develop ways round key disclosure. For example, with the free availability of steganography programmes from down-load sites, it would seem that the Internet community, let alone criminal elements, have already discounted that part of the Bill.
  Secondly, there are legitimate concerns that the imposition of that regulatory regime will act adversely upon the UK's ability to compete effectively in both the e-commerce and financial services industries, the more so given that those are such hugely mobile industries.
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  Thirdly, the more logical and effective recourse for law enforcement agencies in this area is through such means as forensic hacking. There must be a risk that that investigatory avenue could begin to play second fiddle to key disclosure. That would be extremely regrettable.
  I have a few general questions. First, do the Government have a finger on the pulse of what percentage of encrypted traffic is derived from criminality? While I acknowledge that that is difficult to quantify, I have yet to see any figures which enable us to assess the scale and seriousness of the problem. Given the huge popularity of the Internet, logic leans me towards me the supposition that its use by criminal elements is, in reality, quite a small percentage of overall traffic.
  The important point is that without that knowledge, it is all but impossible to assess—I use that word again—the proportionality of the Government's proposals.
  Following on from that, it would be extremely helpful if the Minister could afford the Committee some insights into how other countries are facing up to that problem. In other words, how do the Government's proposals compare with practice, either existing or proposed, elsewhere in terms of scale and degree? Do other countries, particularly our competitors, have, or are they taking, powers to require key disclosure in whatever form? In the event that they are, how do their safeguards compare with the regime proposed in the Government's amendments. Needless to say, that is of paramount importance in assessing the sort of impact which the Bill may have on our competitive position.
  I turn from the general to the specific. The Minister proposes a number of amendments which substitute the phrase,
  "requirement to disclose the key",
  with,
  "disclosure requirement in respect of the protected information".
  That is all good and well. That is an essential part of the recast of the clauses. I simply ask the Minister why, in the circumstances, and for the sake of consistency, it is not possible to use the formulation,
  "disclosure of protected information in an intelligible form".
  In other words, I should be grateful if the Minister will explain the distinctions between the two phrases.
  At the risk of stating the obvious, there is a very significant and important practical point at issue here. One almost tires of saying it, but the single biggest obstacle to the take-up of e-commerce is that of trust in its confidentiality and security as a medium of communication and exchange. It must be said that a regulatory regime which conveys the perception that such matters are being compromised is, by definition, antipathetic to the Government's aspiration to make the UK the best and safest place for e-commerce in the world.
  To be fair, the Government have said consistently that it was and is their intention that only in exceptional circumstances will Clause 46 notices

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  require the surrender of keys. But that is not the way in which the Bill was originally drafted, nor, on my reading, do the amendments spoken to by the Minister entirely resolve the issue. However inexpertly, my amendments in the group, Amendments Nos. 139A and 164A, sought to achieve the same objective.
  I have but one more point of concern which is relevant in this regard and I hope that the Minister will assist me with it. I am uncertain how the new cast of the relevant clauses will interact with other legislation, both here and overseas. In particular, are the Government entirely satisfied that in instances where the surrender of a key is required, there is no likelihood that inadvertent breaches of contractual or legal obligations for confidentiality will occur? It may well be that I am worrying unnecessarily on the point but some clarification from the Minister would help.
  Finally, like my noble friend Lord Lucas, I subscribe to the view that, in the circumstances, the best solution available is to withdraw the whole issue of key disclosure from the Bill. With the best of imaginations, it is very difficult to formulate the sort of amendments required to unravel the harm which those proposals may cause to UK plcs.
  Lord Bassam of Brighton: I am grateful to all Members of the Committee who have contributed to the debate. I am grateful also to all those who have made positive contributions, and most of the contributions were positive. I shall try to answer as many of the questions as I can, although I must study in some detail the questions of the noble Earl, Lord Northesk, and reflect on them because they were rather more complicated.
  We can provide him with an extensive description as regards international comparisons but it may be that that is best done through correspondence.
  The noble Lord, Lord Cope, asked who authorises the acquisition of the key in those circumstances. It is the Secretary of State, a circuit judge or magistrate or a police superintendent or equivalent in the Customs and Excise and Armed Forces. I believe that that answers that important point.
  Quite rightly, the noble Lord, Lord Cope, was delighted, as we were, that Members of the Committee have been furnished so quickly with a revised version of the Bill. That was a helpful initiative. We also hope that the noble Lord, Lord Cope, and other Members of the Committee have similarly found helpful the document that we sent out to describe exactly how we see our revisions working. We shall continue to perform in that way because it is right that we put as much in the public domain by way of explanation, context and understanding as we can.
  While no government likes criticism, it is essential. If it stimulates important debate and enables us to focus on hard issues, it does a great service. In this exercise it has been extremely helpful.
  The noble Lord, Lord Blackwell, made comments that related to the point of principle and to matters of practicality. As I understand his comments, they seem very helpful. I hope that the way in which we have
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  proceeded will be of help to him. When he reads Hansard I believe that he will see that we have tried to address points of principle and points of practical implementation.
  The concept of "key" is defined in Clause 52 and it bears some close reading. If there is no key to encrypted data, clearly the powers cannot be exercised. The whole point about encrypted data is that someone somewhere will have the key to that data. That is plain.
  It may be useful if I refer to the point raised by the noble Lord, Lord Lucas, in relation to self-incrimination. The Article 6 point can arise only in the context of criminal proceedings brought against a person who has been required to disclose a key and where the data that that key unlocks are used by the prosecution in any proceedings against that person. Clearly, that will not arise in many cases—for example, where encryption requests are made to third parties, communication service providers, and not to the accused. We believe that our proposals are ECHR compatible, even when the holder of protected data is required to disclose the key. Of course, the key itself is not self-incriminatory.
  In our view, the correct analysis is that a key has an existence independent of the will of the subject. We believe that that was explicitly approved by the European Court in the leading case of Saunders v. United Kingdom in 1996. The court found that the right against self-incrimination does not extend to the use in criminal proceedings of material that may be obtained from the accused for the use of compulsory powers, but which has an existence independent of the will of the suspect; for example, documents recovered under a warrant. I hope that that clarifies the issue for the noble Lord.
  The noble Viscount, Lord Goschen, asked about the circumstances. I believe it would be circumstances in extremis. He also asked whether plain text would be involved in the majority of cases. I believe that plain text will suffice in most cases. That is our clear intention, and that is why we have been more than happy to rewrite this in the way that we have.
  The noble Earl, Lord Liverpool, said that he thought that our amendments had not addressed his concerns. The simple answer is that we already believe that the Bill, as drafted, effectively addresses them, but we are more than happy to consider further the point that he has made. After giving it further consideration, we may bring forward an amendment on Report that puts the matter beyond doubt. We are happy to look again at the issue he has raised.
  I felt that the argument of the noble Earl, Lord Northesk, was based on pessimism. From what he said, it seemed that the imaginative criminal mind will always be so far ahead of us that it would be self-defeating to attempt the art of enforcement and the recovery of information. I do not believe that he thinks that is the case in his heart of hearts, but that was how it sounded.
  7.45 p.m.
  The Earl of Northesk: I actually said the opposite. I said that in pure terms, so far as encrypted data are concerned, the resources available to law enforcement agencies in terms of forensic hacking and so on, are better arms at their disposal than something that is so patently easy for the criminal to get round by being on the face of the statute.
  Lord Bassam of Brighton: I am prepared to take the argument at face value. I do not believe that the noble Earl has entirely disabused me of his intention. From what he has said, it seems that he believes that we should not be legislating in this area at all and that we should approach the matter from a completely different angle. That is an argument that rests on pessimism.
  I said that I would respond in detail because the questions were detailed. I hope that I have answered as much as I can in what has been a useful debate. On that basis, I shall move our amendments. I hope that noble Lords will withdraw their amendments in favour of the government amendments, which try to answer the points raised in the various amendments tabled for this debate.
  Lord Lucas: Perhaps I may return to a couple of matters. As the noble Lord said, the paragraphs of Clause 46(1) cover the situation whenever the police or the Customs and Excise are on a raid. It is inconceivable that under those circumstances the warrant will not ask for the key. In those circumstances the key will be needed; you will not trust the people concerned to do the decryption for you. Although the Government say that only exceptionally in the current set-up will keys be asked for, I believe that they will be asked for every time there is a raid. There must be tens of thousands of raids a year. Anyone raiding premises for computer equipment will go equipped with a warrant saying, "We want the key". Unless we have clear comfort by way of letter, I believe that we shall have to be firm on this matter on Report.
  To throw another stone into the pool of self-incrimination, I keep my passwords in my head; they are not written down anywhere. Presumably, under those circumstances, I could not be asked to reveal them.
  Lord Cope of Berkeley: I am still slightly uncertain as to exactly who can authorise a key as opposed to plain text. The Minister said that authorisation could be given by the Secretary of State, by a circuit judge, by a magistrate, or by a police superintendent or equivalent person in other areas. I am not sure how the police superintendent comes in at this stage. Reading the Bill—perhaps I read it wrongly—it seems that the warrant from the Secretary of State, the judge or the magistrate giving permission would, in various cases, need to state that a key had to be disclosed or was required so that the police superintendent or equivalent person could put that into the notice. If the warrant did not state that, the police superintendent or
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  other person would not have the necessary permission. Perhaps I am wrong, but it seems to me that one should say so—although I entirely accept the point made by my noble friend Lord Lucas that, if I am right, warrants habitually will state that. The definition of "special circumstances", or the use of the phrase "special circumstances", will deteriorate over a short period of time until it means practically any circumstances in which a warrant is served.
  It is important to understand, if we can, what the line of defence is as between plain text and key. Is it the Secretary of State, judge or magistrate issuing a warrant or the officials of the law enforcement agency, the police superintendent or above, who are giving the additional permission for the key to be obtained?
  Lord Bassam of Brighton: I believe the comfort the noble Lord is after is in Schedule 1, which follows on from Clause 46(7). That sets out the various levels at paragraph (6). If the noble Lord is not satisfied with the explanation I gave earlier, then I shall be more than happy to come back and provide him with some extra comfort, as we shall through all stages of this legislation. I trust that that answers his point.
  Lord Cope of Berkeley: The Minister is very kind to look after my comfort. But the specific part about which I am concerned is Schedule 1, paragraph (4). That seems to widen the permission but is so obscurely phrased that it is difficult to be certain exactly what the effect will be in practice, at least as far as I and others with whom I have discussed this matter can see. In my view, it may well need amendment to ensure that the additional permission required to go for the key as opposed to plain text should be given by, at the very least, a magistrate in the course of giving permission for the operation to take place.
  I can see that I shall not get much further with this matter this evening. We may have to return to this at a later stage.
  Lord Bassam of Brighton: I am happy to consider the point the noble Lord makes, but I say that without commitment.
  Lord Cope of Berkeley: I am grateful for that.
  The Earl of Northesk: As the Minister said, we have had a useful debate, even if it turns out to be only a first trot round the course. I would of course like to be able to say that I am entirely satisfied with the outcome. But I hope the Minister will recognise why it is that I and other Members of the Committee persist in having residual concerns on this matter.
  I thank the Minister for his assurance that he will write to me on a number of issues. Perhaps I may suggest that it would be helpful if he could copy that correspondence to others who have contributed to the debate.
  There is absolutely no doubt that we will return to this issue again. It simply falls to me at this juncture to bang the drum yet again for recommitment. In the meantime, I beg leave to withdraw the amendment.

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  Amendment, by leave, withdrawn.
  Lord Bach: I beg to move that the House be now resumed. In moving this Motion, I suggest that the Committee stage begin again not before 8.53 p.m.
  Moved accordingly, and, on Question, Motion agreed to.
  House resumed.

Vaccine Damage
7.53 p.m.
Lord Ashley of Stokerose to ask Her Majesty's Government whether they will improve the Vaccine Damage Payment Scheme.
The noble Lord said: My Lords, the story of vaccine-damaged children and the campaign to secure justice for them is one of high hopes, disaster, sadness, anger, bitterness, frustration and despair.
No government, until now, has a proud record on this issue, but the record of the Labour Government is far more enlightened than that of Tory governments. Only government can give the story a happy ending and I am glad to say that, after yesterday's announcement, this Government are moving in that direction. But it will only be a happy ending of sorts because no government can restore the health of someone severely brain damaged, who suffers lifelong convulsions and who has neither talked nor learnt anything since she was vaccinated as a happy, healthy child some 40 years ago. Those are the facts.
Not only was that child's health and happiness shattered, so were the high hopes of her parents. And I pay warm tribute to her mother, Rosemary Fox, who established the Association of Parents of Vaccine Damaged Children in 1973 and with whom I campaigned for many years. Only she, myself and my wife Pauline, who worked with me, know how appallingly tough the going was in the early 1970s. The only other person involved was Kay Andrews—now the noble Baroness, Lady Andrews—from the House of Commons Library, who did a tremendous amount of work supporting us.
In those days we met with prejudice, ignorance and generally a contemptuous dismissal of our claims. The £10,000 payment in 1978 came about only as a result of an imaginative and generous intervention by the then Prime Minister, James Callaghan. Today, the atmosphere is much more favourable, with many people well informed.
I have always expressed my support for the immunisation programme and I am glad that the great benefits of vaccination are now accepted almost without dissent. So is the need to establish herd immunity. But it is also clear beyond all doubt that there is a small risk—probably a very small risk—with vaccination. If the Government impose pressure on parents to vaccinate their children so that society can be protected, as they do through the GP incentive
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scheme, they must also accept their moral duty to support the affected children and parents, as they are now doing.
Arguments over how and to what extent the Government should provide support have raged for some 20 years. I congratulate the Daily Express on its recent forceful campaign. In its day, the £10,000 payment scheme was hailed a triumph, though only because we campaigners saw that as a prelude to the introduction of the Pearson Royal Commission strict liability scheme. As the years passed and no such scheme emerged, the parents became more and more embittered and MPs have been vociferous in their support in recent years. I pay tribute to the splendid work of Ian Stewart and his all-party group.
Ministers have just published the results of the Government's review of the payment scheme. I congratulate Alistair Darling on this major step forward and Hugh Bailey, who did so much of the work. I am sure that the whole House knows of the unswerving support given to vaccine-damaged children by my noble friend Lady Hollis.
I cannot speak for the parents and I suspect that those who asked for £1 million each will not be content. But I warmly welcome the proposals. They are a comprehensive and much needed improvement on the current payment scheme.
The amount of £100,000 will not provide a lifetime's care. But it is a worthwhile amount. It will ease the burden and help parents, especially over those initial awful years when they begin to realise what lies ahead. It is a welcome lifeline, more than doubling the existing amount. I welcome also the Government's decision to help those children—many of whom are now adults—who were damaged in previous years. All too often the natural distaste for retrospective legislation is a barrier to justice. It certainly was when Service people were allowed to claim for negligence, but not retrospectively—the famous Section 10 debate in the House of Commons. This Government have avoided that with vaccine damage and I am pleased that parents who have already received a payment will get it topped up so that all receive equal benefit.
The existing Vaccine Damage Payment Scheme has been criticised for two reasons—first, because the payment level has been inadequate and, secondly, because of the high barriers around it. In some years, only one claimant in 10 received an award. That was a deplorable situation and one which requires a ministerial explanation. I hope that my noble friend can help us on that issue.
The reduction of the 80 per cent disability level to 60 per cent is an excellent step forward. I am delighted that the Government have been wise enough also to apply this change retrospectively. But I want to ask my noble friend: how many more children will become eligible? If she does not know the facts, perhaps she can estimate the number. I ask that question because some press reports say that only a few will benefit. The House would like to know the truth.

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The increased time for claiming is also helpful; but it is not good enough. Some children were damaged 30 or 40 years ago and, for good reasons, parents did not claim within the existing six-year time limit. They will lose out. There should be no time limit at all; indeed, there is no logic, no reason and no rational basis for it. I hope that my noble friend will be able to help me on that.
These advances by the Government raise two further issues. The first is to ensure that all families receive the full award and that none of them loses out through means testing either by the Benefits Agency or, as is more likely, by local authorities. Many of the affected children are now adults and live in local authority homes. Of course, the number will grow as their parents die. Will my noble friend ensure that the money from the £100,000 payment will be disregarded for means-testing purposes? I regard this as a point of cardinal importance because it would be quite wrong to make this a swings and roundabouts issue.
Secondly, where do we go from here? The issue of proper compensation, as recommended by the Pearson Royal Commission in 1978, remains unresolved. Pearson recommended that the Government should be strictly liable in tort for damage caused by state promoted vaccination; and that full compensation should be awarded by the court on proof of causation, without the need to prove negligence. I believe this to be the next major step forward. However, today is a day for congratulating the Government on easing the appalling burdens that have shattered families for decades.
8.02 p.m.
Lord Brennan: My Lords, I speak in this debate as someone with personal experience of litigation involving those affected by vaccine damage; and I regret to say that it was a negative involvement. It is well known that I advised the Legal Aid Board a number of years ago that the medical science in this field did not show a definitive connection between the vaccine and its neurological effect, as alleged. That meant that the "solution"—if it is to be properly so called—to these problems for parents and child was not to be found in our courts. It probably explains why the Pearson Committee took the suggestion of strict liability so seriously all those years ago.
I have introduced that background to indicate to the House that there is no present science that will definitely establish the connection between the vaccine and the consequences from which these children suffer. That is why the Vaccine Damage Act and its scheme give a payment based on a system of practical justice, whereby, if the neurological effect follows the administration of the vaccine in so quick a span of time that a reasonable person could make a causative connection, there will be an award. That is a novel system of compensation in our attempts to look after those as grievously damaged as these children.
The vaccine damage scheme is not a compensation scheme. Were it to be so, the mercifully small number of children affected—some 900—would each, depending
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on his or her life expectancy, be anticipating an award of anywhere between £1.5 million and £2.5 million from a court. That would represent a colossal amount of money, which the Government could not afford to pay. However, it graphically illustrates the extent of need which these children have and which is presently almost entirely met by their parents and family.
It was, therefore, with great pleasure that I read yesterday's Statement by the Secretary of State, which included some major changes to the operation of the scheme. First and foremost—and properly described—there is to be a dramatic increase in the lump sum payment. It was increased by this Government from £30,000 to £40,000 in 1998 and has now been increased to £100,000. Secondly, and most importantly, it has been backdated so that everyone who is a proper beneficiary of the scheme will be paid the full amount, or the proportionate amount, up to £100,000, depending on the age of the claimant.
Thirdly—and, again, most importantly—the removal of the six-year time limit within which to bring a claim is a just act. The time limit is now to be extended to 21 years. It is difficult to conceive of a family afflicted with this problem who, within those years, would not discover that there was a scheme to which they could have recourse. Fourthly, the disability threshold is to be reduced from 80 per cent to 60 per cent. In the minds of the families concerned, that really should produce a sense of justice where previously there was a strong sense of injustice. It is not a perfect solution, but it is a considerable step forward.
Finally—and this should not be forgotten in the years to come, should benefits be reviewed—the interaction of incapacity benefit and mobility benefit whereby they are increased will be an additional benefit to the lump sum payment. All these changes are of the greatest importance to these families. They are small in number but the effects of the damage inflicted on their children are enormous. These changes go some way towards recognising that burden. However, there is more to be done.
I shall not repeat the most important remarks made by my noble friend Lord Ashley to the effect that means testing ought not to be introduced in relation to these payments. We must not forget that, with the advance of modern medical science, many of these children will probably outlive their parents and finish up in hospitals or state institutions. When that event arrives, it would be a tragedy if what little means those children had were to be means tested.
What should next be done to build upon this new initiative? First, and surely most important of all, when will these changes be introduced? They require primary legislation and subsidiary regulations. As regards primary legislation, the Secretary of State said in another place yesterday that it would introduced at the "earliest available opportunity". As for regulations, he said that he would introduce them,
"as quickly as I can".—[Official; Report, Commons. 27/6/00; col. 723.]
We do not often hear such determined promises as that. I do hope that they will be fulfilled. No one—I emphasise the words—could conscientiously object to

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either legislation or subsidiary legislation being pushed through these Houses of Parliament with maximum speed for this cause.
Secondly, in the year or two—if it is that—in which these changes are to be brought in, inevitably the families involved, and the new ones who become involved, will want to know how the scheme will affect them. Problems of interaction of benefits and so on will be acute for them. I invite the Minister to indicate whether in this preparatory stage to legislation, or perhaps in a year or two after it is introduced, there will be a system in which a nominated civil servant or a nominated office within the department will have the specific task of dealing with and answering the queries of parents that are sure to arise. That can be done efficiently through the Association of Parents of Vaccine Damaged Children. It is no good satisfying ourselves that legislation will make a change unless we accompany it with promises and action that explain the changes to the people most affected.
Finally, the scheme is the product of the need of society to vaccinate children against serious illness. That is a worthwhile intent. However, it has immoderate and tragic consequence with which we are dealing tonight. What is at the heart of the problem? It is the administration of a drug. The drugs used are the products of multinational companies of enormous size and wealth, which, having profited from the sale of the vaccine, could paradoxically be the vendors of the very medicines that are used to alleviate the damage that is thought to be associated with the vaccine. In this new century, surely we can expect a moral content in the world of commerce that was previously lacking, can we not?
I point out to your Lordships' House that Smithkline-Beecham, one of the largest vaccine manufacturers, made a profit last year of £1.98 billion from transactions that included the sale to the state of £779 million-worth of vaccine. That is one example of several. That company is in a monopolistic or quasi-monopolistic position. It is fair, just and reasonable that it contributes to the cost of the damage in this small number of cases. It is therefore with extreme disappointment that I hear that when the Government approached that company for help there was a frank and firm refusal to do anything. That is unacceptable. It should change; the Government should not give up, and not just because of vaccine damaged children. In years to come genetic medicine, biochemistry and the medical field will produce huge profits for companies such as those that I have described. If their attitude is as described by the Association of British Pharmaceutical Industry; namely,
"The Government implemented the vaccination programme knowing in full detail what the possible side-effects were.
They knew what they were taking on, the damage is therefore their responsibility and they should compensate people accordingly",
that sends an extremely tough message from commerce to government. Fortunately, government seek to represent the people and, in doing so, the pressure they bring on these companies over the next
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few years should be unrelenting. The companies should contribute without adding the cost of that to the profit they seek to make from sales to government.
Having addressed three necessary steps, I end my speech by congratulating all those people—some of whom are present in the Public Gallery—including my noble friend, Lord Ashley, and the honourable Member for Eccles—on all they have done over 20-odd years to produce some justice for those who deserve it. At the end of the 20th century all we know is that in the years to come there will be yet more children—small though the number may be—affected by vaccine damage. In my experience in the lifetime of a government there are one or two defining moments which may be moderate in their compass but profound in their effects for society. This is such a moment because it enables the Government to show that they care for people in need. I welcome the proposals.
8.15 p.m.
Lord Clement-Jones: My Lords, first, I thank the noble Lord, Lord Ashley, for initiating the debate with his usual impeccable timing. The debate takes place not only a day after the Government's Statement but on the very day that the major vaccine damaged children lobby took place in Westminster Hall. I pay tribute to the noble Lord's long-standing commitment to the cause of vaccine damaged children. We have already heard two fine speeches. The debate has already proved to be one of high quality and great interest.
The history of the vaccine damage payment scheme is extremely well known and has been rehearsed by the noble Lords, Lord Ashley and Lord Brennan. The history of the review of the scheme says nothing for the Department of Social Security's sense of urgency or the Treasury's compassion. Despite a pledge when in opposition to address the issue, it was only yesterday that the outcome of the review was announced, some three years after the general election and some two years after the noble Baroness, Lady Hollis, pledged that the Government would conduct a thorough review of the service.
Throughout the past three years Members of this House and the other place have asked numerous questions about progress, and I believe that parliamentary lobbies have taken place on three occasions. The Labour MP for Eccles, Mr Ian Stewart, the chairman of the All-Party Group for Vaccine Damaged Children—of which I have the privilege to be a member—initiated an adjournment debate at the end of 1998 in the course of which he was promised the results of the review in 1999. My right honourable! friend Charles Kennedy MP made a telling contribution on the subject of the scheme only two weeks ago at Prime Minister's Question Time. It is a testimony to the tenacity of the parents and that of the all-party group, particularly its chairman, Mr Stewart, and that of the Daily Express that the Secretary of State, Mr Darling, finally made an announcement yesterday.

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I certainly do not want to be churlish about the contents of yesterday's announcement, which we on these Benches very much welcomed, particularly those provisions which have retrospective effect. The noble Lord, Lord Brennan, referred to those. However, there are key questions that need to be mentioned. The noble Lords, Lord Ashley and Lord Brennan, raised some of those questions. I hope that I may ask some further questions of the Minister and that she will respond to them when she replies to the debate.
Will the new 60 per cent disability threshold also be backdated for those who have previously applied to the vaccine damage payment unit but have exhausted the appeals process? There is the injustice of setting an arbitrary threshold, whether that is 60 per cent or 80 per cent, as at present. I am sure the Minister will be aware that parents will continue to feel strongly about this matter whether the threshold is 60 per cent or 80 per cent. Why could not a tapering system have been adopted? That would surely have been the most just way of proceeding. After all, how can one precisely quantify a 60 per cent disability? Surely this is a highly subjective process. How can we even guarantee parity between one method of assessment by one consultant and the next?
I have other questions. When will the payments to victims be made and how will they be made? Which elements of the announcement can be put into effect very shortly, perhaps before the Summer Recess, by regulation, and which elements will require primary legislation? What is the timetable envisaged by the Minister's department for each of those elements? Can payments be made on account? Is that envisaged? How will payments—the issue of means-testing was raised by the noble Lords, Lord Ashley and Lord Brennan—affect income support and other benefits available to the victims of vaccine damage? Will guidance be issued to those who will be in receipt of these additional payments?
As has already been said, the key point to make in this debate is that the changes to the vaccine damage payment scheme must be seen only as a first step to securing justice in the form of full compensation for the vaccine victims. Many of the victims require 24-hour support. I met many of them today, as I have on previous occasions. The cost of providing this support by professional carers ranges from approximately £80,000 to £120,000 per annum. At the moment in many cases parents are the only carers. Some of them have terrible tales to tell about the withdrawal of invalid care allowance when they reach pensionable age. Many of the parents are over pensionable age. I received correspondence regarding one parent who is being pursued for £1,400, a so-called over-payment because of the receipt of payments after she reached pensionable age.
I have checked with personal injuries lawyers—perhaps not as distinguished as the noble Lord, Lord Brennan—who act in personal and medical injury cases about how the appropriate income would be provided for by a court in circumstances where a court made a determination of compensation. I was
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informed that £3 million—I would go rather higher than the noble Lord, Lord Brennan—would be required in a case such as this to provide for that level of income. After the recent case of Wells that may well be the kind of figure that would be claimed. Three million pounds is a very large amount of money.
Therefore, will a back-dated payment of just £67,000 provide adequate compensation for families who have endured up to 40 years of financial hardship and emotional turmoil? I suggest not. These parents, many of whom are now in their 70s, need to have the assurance that their vaccine damaged children will be properly supported when they, as parents, can no longer do so. Only through a proper lump sum payment can this be done.
Much has been made by this Government and the previous one of the vaccine damage payments being payments rather than compensation. Yet the fact is, as both the noble Lords, Lord Ashley and Lord Brennan, pointed out, that government have a responsibility to provide adequately for the welfare of those undergoing vaccination. To quote Dr John Clements, a vaccine safety expert at the World Health Organisation:
"There is no perfectly safe or completely effective vaccine, but we all benefit from them. Countries should have a responsibility to make sure if people take part in a programme they are supported if things go wrong".
On a previous occasion, the noble Lord, Lord Ashley, likened—in my view rightly—the victims of vaccine-related disability to war veterans who have suffered for the good of society. He said:
"They are the victims of a war fought on behalf of us all and must be compensated for their sacrifice".
The Government therefore need to answer the following additional questions. Do they recognise that the changes to the VDP scheme are only a first step to securing full compensation for these vaccine victims? Will the Government now take steps to secure proper compensation for the victims of vaccines so that these very badly disabled individuals can be supported when their parents are no longer able to care for them? Will the Government redouble their efforts with the relevant pharmaceutical companies, such as Glaxo-Wellcome, to ensure that they take responsibility and share in the financial settlement? Will they redouble their efforts to ensure that the medical records of vaccine victims are made available, many of which seem to have been unaccountably lost after they made a claim? In all of this, which is the lead department that will take the initiative?
I have enormous sympathy for the parents and the victims of vaccine damage and I feel angry on their behalf. It is quite scandalous how long they have been allowed by governments of each colour to suffer without adequate legal or other remedy when they have clearly been the casualties of an official government public health vaccination policy, whether this has been for DPT, MMR, polio or whatever.
It is the Department of Health which institutes public health policies and the department which chooses the vaccines and the department which should have tested them properly in conjunction with the pharmaceutical companies. It should now be urgently

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reviewing the position, particularly in the light of worries about the fall in the rates of certain vaccinations which could, in the view of public health experts, lead to epidemics in diseases such as measles.
If the Department of Health and the pharmaceutical companies do not take responsibility for past vaccine damage but hide behind the legalities of the law of tort and the requirement to show clear causation and negligence, it is hardly surprising that parents have second thoughts before arranging for their children to be vaccinated. The noble Lord, Lord Brennan, cogently described the way in which the parcel had tended to be passed by the pharmaceutical companies to the Department of Health, and so on.
I have a confession to make. I am one of those parents who has second thoughts about vaccinating their child, particularly as regards MMR for my young son. I am clearly not alone in this. Even with the knowledge that the chances of vaccine damage to a child may be one in a million, the Department of Health's historically dismissive and legalistic attitude—indeed even denying that there is such a thing as vaccine damage—will ensure that vaccination rates continue to fall. I suggest that Ministers and the Public Health Laboratory Service—now in the wise hands of a Member of this House—urgently review the position, not only in respect of the vaccine-damaged children under discussion today, but for the future as well.
Unless there is put in place a proper no fault compensation scheme, similar in generosity to that in the United States, and as recommended by the original Pearson report, and similar to the kind of compensation that could be achieved in court, I do not believe that the confidence of parents will be re-won. And certainly justice will not have been done to these severely disabled children who have already been the victims of vaccines.
Lord Brennan: My Lords, before the noble Lord sits down, perhaps I may invite him to agree that it is important in a debate such as this that unreasonably high hopes are not sent out to the affected parents. Is he really suggesting that the problem which we face should be dealt with by full compensation, which, on my calculation, would amount to between £1.5 billion and £2 billion? That is beyond the means of any competent government.
Lord Clement-Jones: My Lords, that is a very fair question. My view is yes. If one accepts that there is compensation to be paid, one has to come up with a scheme that provides an income for the severely disabled children so that they are able to cope when their parents are no longer able to care for them. It was perfectly possible to do so in the case of the thalidomide children. It is perfectly possible to envisage a scheme—perhaps a trust fund rather than individual forms of compensation—where a lump sum could be paid from which these parents could derive an income. Obviously the income that they derive from that scheme would depend on the level of disability of their children.
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This is not a question of raising hopes. It is a matter of wishing to see justice done in these circumstances. If a court had awarded these children compensation, the types of payment that I have suggested would not be outlandish; they would be entirely appropriate.
8.28 p.m.
Earl Howe: My Lords, yesterday's announcement on the improvements to the vaccine damage payment scheme was extremely welcome. Even though it preempted much of what I was going to say today, perhaps I may take a few minutes to ask the Minister some questions and cover some of the important issues arising from the announcement.
First, however, I should like to set out a little of the background to this issue. If one looks back over the past quarter of a century at any of the important political crusades relating to the needs of the disabled, the name of the noble Lord, Lord Ashley, is almost certain to be closely associated with it. There can be few better examples of that association than the issue which the noble Lord has brought to the House this evening. It was through his efforts in another place in the late 1970s that the Vaccine Damage Payments Act 1979 came into being. That legislation was welcomed at the time as a recognition of a moral duty on the part of the state to provide financial assistance to those children who had suffered severe physical or mental damage as a result of being vaccinated.
As stated by other noble Lords, the scheme was never billed as being a form of compensation in the normal sense of the term, nor indeed did it carry any implication of public negligence. Rather, it was an implicit acknowledgement by the state that in arty programme of mass vaccination, whether it he for measles, mumps, polio, whooping cough or for a range of other serious diseases, there will be a very tiny percentage of children who experience unpredictable adverse consequences. For some, those consequences are minor and transient. For others, they are truly devastating.
Traditionally, damage that arises from non-negligent accidents occurring in the NHS has not given rise to any form of state payment, but in one important respect the damage that stems from vaccination is different from other damage. Vaccination does not simply benefit the individual who receives it. It is the state which says that parents should immunise their children because it is for the common good that life-threatening diseases should not be spread around the general population. The state encourages vaccination even though it is known—notwithstanding the no doubt legally secure position of the noble Lord, Lord Brennan—that a very few individuals will suffer a serious and irremediable adverse reaction.
But paying those individuals from public money is not simply a recognition that they have suffered for the general good. There is another dimension; namely, that any immunisation programme depends for its success on a certain level of take-up. Once the take-up rate falls below a critical figure the risk of an epidemic becomes a very real one. It is obvious that unless the

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public has confidence in an immunisation programme, it will not subscribe to that programme. Perhaps I may say to the noble Lord, Lord Clement-Jones, with whom I do not often disagree, that it was the fears surrounding the MMR immunisation, misplaced though they were, and the accompanying decline in public confidence that led to the recent worrying drop in the take-up of that vaccination programme.
I believe that all political parties have a duty to join forces on a policy of this importance—resting our case on the basis of the scientific evidence, which is firm. But confidence has a number of buttresses. The Government can also protect their vaccination programmes if parents of children know that in those few cases which lead to tragedy a scheme is in place that will provide a worthwhile measure of financial support.
That is why yesterday's announcement, coming as it did after two years of deliberation by the Government, was so welcome. I shall not carp too loudly at the time it took for the Statement to arrive, knowing as I do something of the frustrations of trying to secure inter-departmental agreement on such matters. In any event, I hope that the retrospective element in the new package will do something to assuage those who feel, in the words of the Minister in another place, Mr Bayley, that,
"Two years is indeed a long time".—[Official Report, Commons, 6/6/00; col. 20WH.]
Had yesterday's Statement not been made, there were two changes in particular that I would have asked the Government to introduce. The first was to abolish the six-year limit for making claims. That has effectively been done and I congratulate the Government on it. The second was to bring down the disability threshold from the level of 80 per cent and to introduce a sliding scale of payments for disability assessed at below that level. That is the request that has been made by the Vaccine Victims Support Group, whose patience and dignity I think we must all applaud and respect. It is a proposal which seems to me to be entirely equitable. The change proposed by the Government to bring the threshold down to 60 per cent will mean that anyone with damage assessed at below that level will receive nothing. I ask the Government why they believe that that is a fair way to proceed. Even at this juncture, I hope that they will be prepared to reconsider the issue.
I wonder if the Minister can clarify one or two other points in relation to the primary legislation that we understand will be needed for both of these measures? First, when do the Government propose to introduce the necessary Bill? It need only be a short Bill. I give the assurance that we on this side of the House will cooperate with the Government fully when it appears.
Secondly, can the Minister tell us a little more about the retrospective element of the announcement? If the threshold is to come down from 80 per cent, does that leave the way open for individuals whose claims were rejected because they did not come up to that level to re-open their claims? Similarly, will it now be possible for those who had their claims turned aside because
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they were not made within the six-year limit to reapply for a payment under the scheme, even though they may now be over the age of 21?
Perhaps I may add my welcome to the significant uprating of the sum payable to those who have suffered severe damage from vaccination. The figure of £100,000 is not a king's ransom, but it is an order of money that more realistically reflects the burdens suffered by victims and their families than does the current level of payment. Can the Minister say whether the appropriate regulations will be laid before the Summer Recess?
I should also like to ask the Minister about research. The extraordinary discoveries announced this week on the mapping of the human genome may one day enable scientists to predict which children have a genetic susceptibility to an adverse reaction from vaccinations. However, can the Minister say what research is currently under way into the formulation of improved vaccines and into efforts to minimise the terrible adverse reactions that we have been debating?
I conclude by asking the Minister whether she will take this opportunity to reaffirm the Government's policy on childhood immunisation? On this important issue, do the Government agree with me that party politics should be put aside? Indeed, will they consider entering a joint campaign with the Opposition to promote vaccination as an essential public health measure? I hope, too, that the Minister will take the opportunity to reassure the House today that all vaccines approved for use in this country are rigorously tested to the highest standards of safety, quality and efficacy? That is a message that bears repeating often, as does the warning that, were a vaccination programme to fail through lack of adequate take-up, it could lead to consequences as devastating in their severity as those that have been referred to this evening, but for a very much more numerous cohort of children.
8.38 p.m.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, I am delighted that the Government's measures have received a warm welcome tonight. Substantially, the measures owe much to the delicate, subtle and hesitant persuasion brought to bear on Labour Ministers by my noble friend Lord Ashley. I am very pleased that the whole House recognises the role played by my noble friend in achieving these results.
Perhaps I may begin by setting out a little of the background to the review of the scheme. Soon after the present Government came to power, Ministers were approached by various groups and by the newly-formed All-Party Group on Vaccine Damage. We were asked how we would review the scheme. At the time, I had responsibility for disability issues as well as children's issues. I announced that a review would be undertaken, in consultation with the Department of Health, as part of our overall review of welfare.

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Since that time, various meetings have taken place between myself and members of the all-party group, along with members of the parents' groups who have so eloquently presented their case. These groups included the Association of Parents of Vaccine Damaged Children, the British Polio Fellowship, the Justice, Awareness and Basic Support Group (JABS), and the Vaccine Victims Support Group. This afternoon, the Vaccine Victims Support Group held a well-attended lobby in the Grand Committee Room, and I believe that my noble friend was present.
The groups raised a number of issues with us. They disagreed on some, but the five principal issues were the time limit of six years, the 80 per cent threshold, the need for an additional lump sum, an ongoing benefit for those damaged following vaccination, and a contribution from the pharmaceutical industry towards the support of those damaged by vaccines—the point raised by my noble friend Lord Brennan. The groups also raised questions about vaccination incentive payments and the promotion of vaccines.
We promised to look at all those aspects, which is why the matter has taken a long time. We have also, at the behest of parents, contacted the pharmaceutical industry to seek a financial contribution towards the support of this group of vaccine damaged children. Although it was sympathetic to the issues, the industry did not feel it appropriate to become involved—to my regret. I hope that the efforts of my noble friend and others may persuade it to reconsider its position in the future.
In consultation with the Department of Health, we have therefore been carefully examining the nature of the vaccine damage payments scheme and the scope for changes that we might make. That was why, in that context, my right honourable friend the Secretary of State for Social Security, Mr Darling, made the Statement yesterday.
The proposed changes do not represent any changed judgment about the safety of vaccination but simply our view, as I said when we increased the payment in 1998, that it is appropriate, decent and compassionate to implement these changes.
Subject to parliamentary approval of our proposals to pay £100,000 for new claims, we shall effectively be increasing the rate of payment that we inherited by some £70,000. It is a significant increase. In addition, we have listened to the concern of those parents who received £10,000 in the early 1980s and who, as we know, struggle daily under very difficult circumstances. When we last increased the payment in 1998 to £40,000 we said that that amount would more than restore the value of the payment.
At April 2000 rates, £33,000 would have been the equivalent of £10,000 awarded at the start of the scheme. We have therefore decided that it would be only right in this unusual circumstance to consider top-up payments to bring past recipients up to the new £100,000 rate by revaluing their original payments. It is not often that a government make retrospective payments. I am delighted that they are doing so in this case.
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This means that, if Parliament approves, those recipients who received £10,000 will receive an additional lump sum payment of £67,000. Those who received £20,000 will receive £62,500. Those who received £30,000 will receive £61,500 and those who received £40,000 will receive a further £58,000. This represents an additional £60 million for the most severely disabled—a very significant sum.
Again, subject to parliamentary approval, we hope to introduce the proposed changes as soon as possible. Perhaps I may make clear my understanding of the timetable. It is our hope that the payment of the new £100,000 will be in place before the Summer Recess. We hope to make the top-up payments to those who have already received sums as soon as possible following the other regulations, but that may take time. Some of the payments were made 30 or 40 years ago; addresses need to be checked; people may have changed addresses and we may have lost contact with them. But subject to those practical limitations, we want to make the top-up payments as soon as possible after the regulations have completed their passage through this House and another place.
The other two aspects of the scheme—the threshold of disability being reduced from 80 per cent to 60 per cent, and the changes in years—require primary legislation. That will be introduced as soon as possible. But primary legislation is not required for the payments; we can make those following regulations, which is a much speedier process.
The £100,000 payments will be treated like the original payments for the purposes of income-related benefits and for the purposes of residential care. They will not disentitle recipients of those benefits. As I said, we also intend to bring about changes to the time limits.
We have decided that in the case of time limits for claiming, we should seek to act within the spirit of the proposals in the Law Commission's recent consultation paper on the limitation of actions. The time limit for making a claim will be amended to three years, although in the case of minors the time will not run out until they have achieved their majority. For young children, who make up the vast majority of VDP claimants, there will therefore be an extended period, up to age 21, in which to make a claim.
As I said, we further propose to reduce the disability threshold from 80 per cent to 60 per cent. It is true that the test of at least 80 per cent disability adopted for the Act was and remains generally recognised as the lower end of the spectrum of severe disability—for example, for severe disablement payments, payments for industrial injuries and the like. Lowering that level might be considered inconsistent. None the less, we have taken heed of representations and we think that a reduction to the level of 60 per cent is justified and, representing as it does a still significant level of disability that was incurred as part of a wider public interest policy, it remains compatible with the original aims of the scheme.
The present statutory scheme was introduced in 1979. It was a payment of a lump sum, not in terms of meeting compensation. That, as my noble friend Lord

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Brennan said, is a matter that should be pursued through the courts. It is concerned instead with seeking to meet some of the additional costs incurred by parents. As my noble friend Lord Brennan indicated, the families and the disabled children themselves continue to receive, and rightly so, higher rate disability living allowance and long-term IB, which is now more generous than severe disablement allowance. Their parents will receive ICA and, if they are on income support, the carer's premium on IS, which continues right through. So I think that on all of those points we are able to help your Lordships.
My noble friend Lord Ashley raised a number of specific points. He asked why there was only one award in some years. In most years there are five or six awards, but it is true that in one or two cases—I now know of only a single case— that was the number who were considered that year to meet the entitlement conditions. Obviously, those figures will now change. We do not know the number, but an approximate estimate is that 20 vaccine damaged children a year presently lose out because of the time limit and will now fall within the provision. Again, we do not know how many lose out by virtue of the 60 per cent, but it is our guess that perhaps a handful a year might, and then maybe some 50 or so cases who were refused because they were disqualified by being below the 80 per cent threshold but above 60 per cent. We shall be inviting those people to reapply and, where we can, to make contact with them.
My noble friend's second question—a point also raised by the noble Earl, Lord Howe—related to claims made 30 or 40 years previously. As I say, we aim to make the new provisions fair to people who missed out in the past and who may qualify under the new rules. We cannot say exactly what the position will be. We are carefully considering these points. If my noble friend has a particular case in mind that would fall outside the 21-year cut-off point, we should like to follow that up. Perhaps my noble friend will write to me.
One question which my noble friend did not ask but on which I may be able to bring good news is that, where a child has already died, the department will be considering top-up payments. That is perhaps more generous than my noble friend anticipated.
I hope that I have addressed my noble friend's third question relating to someone in local authority residential accommodation. Similar rules apply in charging regimes for local authority residential accommodation to those that apply to income support: the amounts of payments made into a trust fund or under court supervision are disregarded. I am happy to place those words on the record.
My noble friend Lord Brennan asked whether there would be a nominated or named official as an information point. We have not made provision for that at present. We will take the point away and consider it. Clearly, it is important that families know whom to contact, as well as having the literature. The possibility of a website was raised. We shall pursue those kinds of questions to see how we can be helpful.
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The noble Lord, Lord Clement-Jones, raised a point about retrospection. I hope I have dealt with that. Anyone who applied and was disallowed because he or she was below the threshold will be invited to reapply and have the claim reassessed. If there are delays, it will be because we do not necessarily know any changes of address, given that the previous payments were made 15, 20 or 25 years ago.
I sincerely join in the wise words of the noble Earl, Lord Howe, when he gently chastised the noble Lord, Lord Clement-Jones, in terms of his policy towards vaccination and his suggestion that he might consider not exposing his own child to MMR vaccine. I could not repeat more strongly than the noble Earl, Lord Howe, that there is no scientific evidence whatever in a series of highly regarded reports, including the Thames survey, which was done fairly recently, to show that there is any connection between MMR and Crohn's disease or inflammatory bowel disease. It is simply not the case. There have been repeated studies in this country and in the US and elsewhere abroad showing that there is no such connection.
It is the case that children may develop those diseases, and may do so at the same age as that at which they are having their vaccination. It is a correlation, but no causal connection has been established.
The alternative, which is to expose children to those illnesses, is very serious. I should like to give the noble Lord some information about what happened when there were similar scares relating to whooping cough, percussis. Before the introduction of a vaccine in the 1950s major epidemics of whooping cough were frequent, with the annual notification exceeding 100,000 year. After the introduction of immunisation against whooping cough it fell in the 1970s to about 2,500 a year. However, following public and professional anxiety about the vaccine, anxiety that was proved to be unfounded, there was a marked decline in vaccine acceptance from over 80 per cent to around 30 per cent. The number of susceptible children rose, and in the 12 years after 1976 three major whooping cough epidemics accounted nationally for over 300,000 notifications and at least 70 deaths. The fears became the reality.
If I may so put it, nobody has the right to—I do not want to say "freeload", because that sounds wrong—rely on other people having the vaccine given to their children, believing that as a result they do not need to have their own children vaccinated. They are, so to speak, piggy-backing on the moral generosity of others. I want to put it strongly, because only one medical risk has been established. That is with the polio vaccine, which is one in a million. In no other cases is there any risk, but we know that the risk of the disease can be extremely serious. Any contribution from a Front Bench spokesman will be taken seriously. A suggestion that there is a serious question as to whether one should not have that vaccine can only add

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to public fears and damage incalculably many other children, which I am sure the noble Lord would not wish.
Lord Clement-Jones: My Lords, I hasten to reassure the noble Baroness the Minister that I am not anti-vaccine myself, but she should note—and I will not trade scientific data with her—that with regard to the MMR vaccine 2,000 claims for compensation against pharmaceutical companies are coming. The evidence is being put together slowly but surely about the effect of the MMR vaccination. I also remind the noble Baroness that the United States Congress has been holding a series of hearings about the effect of MMR vaccination, which she may not be aware of either. Serious issues are involved, and I would not mention them lightly.
Baroness Hollis of Heigham: My Lords, slowly but not surely, there is only one piece of medical research. Without naming the doctor concerned, the Medical Research Council has said that those findings are insubstantial and not to be relied on. We will see what happens.
The time is nearly up. I wanted to spend some time trying to address the issue that the noble Earl, Lord Howe, raised. I want finally to say how pleased I am that I am responding to the noble Lord after yesterday's Statement and to put into the record the very graceful and gracious message we have received from Rosemary Fox, who will be known to many of your Lordships and who has led the campaign for so many families, the Association of Parents of Vaccine Damaged Children. Her message reads:
"Congratulations on your decision to make a reasonably large addition to the vaccine damage payment. All parents ringing in are pleased to have further help and are awaiting further details, which I have promised to ask for and pass on to them. Some parents have particularly asked to be dissociated from criticisms being made about the payment. After 20 years of waiting, most are very pleased."
I commend this to your Lordships' House and thank my noble friend for introducing the debate.

Regulation of Investigatory Powers Bill
8.55 p.m.
House again in Committee on Clause 46.
The Earl of Northesk The Earl of Northesk moved amendment No. 139B:
Page 50, line 7, after ("believes") insert ("that the protected information cannot reasonably be obtained by him by means other than the giving of a notice under this section and if that person believes").
The noble Earl said: In moving the amendment, I should also like to speak to Amendment No. 141A.
I confess that some of the steam has been taken out of my concerns as a result of our debate on Amendment No. 139A. Part of my motive was to seek the promotion of plain text ahead of key disclosure. However, a tangential issue remains, concerning the structure of the clause. I cannot help feeling that in the context of
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subparagraphs (a), (b) and (c) subparagraph (d) is incongruous. Hence my formulation of including it in the preface to subsection (2). I should be grateful for an explanation from the Minister as to why, in so far as it remains relevant, subsection (2) is structured in the way that it is. I beg to move.
Lord Bassam of Brighton: The change in the amendment and the consequential change proposed by Amendment No. 141A are covered by government Amendment No. 141B, which we have already discussed. The amended subsection (d) reads:
"it is not reasonably practicable for the person with the appropriate permission to obtain possession of the protected information in an intelligible form without the giving of a notice under this section".
I hope that that amendment reassures the noble Lord. It should; that is certainly our intention.
The Earl of Northesk: I thank the noble Lord the Minister for that reply. He will be aware, from our previous debate, that I still have slight reservations about the phraseology in his amendment No. 139D, but he will write to me on that point in any event.
Lord Cope of Berkeley: There are a number of amendments in this group which belong to the Liberal Democrat Party. I do not know whether my noble friend would wish to comment on them before he sits down, or whether anyone else would wish to do so.
Lord Lucas: I would certainly wish to comment on them. I was waiting in the hope that someone might magically appear on the Liberal Democrat Benches.
Baroness Harris of Richmond: So was I.
Lord Lucas: If we wait long enough we may have the presence of the noble Lord, Lord McNally. I should be very interested to hear him, particularly en Amendments Nos. 157 and 158, where we enter the area of the non-disclosure of key signatures. Where one has used, as some programs will use, one's signature to encrypt something, one's signature is liable to be seized. If that is so, I am not clear how, under the Electronic Communications Bill, the authorisations and signatures that one has made using that signature are affected. Their security is no longer perfect and the possibility that they have been forged becomes real. I am concerned about the way in which the two Bills will work together—the ability to seize someone's signature and the uses to which it will now be put under the Electronic Communications Bill. I do not know how that will all hang together.
Amendments Nos. 157 and 158 address the issue in a slightly different way and add another level of protection. As the Bill is drafted, if one has used a password to hide one's signature one may be forced to reveal it. However, I believe that under Amendment No. 157 a person would be spared that requirement. I should not like to miss the noble Lord's comments on those amendments.
9 p.m.
The Earl of Northesk: I wait to see whether or not the noble Lord, Lord McNally, wants to promote his amendments in this group.
Lord McNally: Our amendments were tabled to close a loophole as far as concerns the use of electronic signatures. Because I entered the Chamber half-way through the debate I am not sure what the weakness in our amendments is supposed to be. The intention is to achieve recognition of the electronic signature and protection thereof. I say no more.
The Earl of Northesk: The Minister may want to respond to points made by my noble friend Lord Lucas and the noble Lord, Lord McNally, who spoke to the Liberal Democrat amendments.
Lord Bassam of Brighton: It is rather difficult to respond to amendments that have not been spoken to. I am content to run through all the amendments in the group, if that is what the Committee desires. Very little reference has been made to the entirety of the grouping. Most of the points made relate to Amendments Nos. 157 and 158. If it assists the Committee, I shall respond only to those amendments which I believe the noble Lord, Lord McNally, and others regard as the most important in the group.
We fully recognise the importance of maintaining the integrity and security of electronic signatures. In that sense we understand why these two amendments have found their way into the group. For the record, I stress the policy position. There is no law enforcement requirement relating to keys that are used solely for the purposes of electronic signature. We believe that there are misplaced worries about signature keys being obtained and then used to impersonate their owners. Clearly, that would not be in the interests of law enforcement, since possibly it would have the wider effect of undermining the validity of such devices and potential prosecutions. The whole point about electronic signatures is to ensure the integrity and authenticity of data.
As I understand it, it is possible for signature keys also to be used for the purposes of confidentiality; in other words, to protect or encrypt the content of data or messages. This is of interest to us. The ability of criminals to encrypt the content of their data is the precise threat that we address in Part III. We believe that where keys have been used for both purposes it is reasonable to have power to require their disclosure. The Committee recognises that in the first limb of Amendment No. 157. The question is whether the second limb—sub-paragraph (b)—and Amendment No. 158 add extra safeguards. Frankly, we do not believe that they do. The protection of electronic signature keys is already there. By virtue of Clause 46(6), if keys have not been used for any other purpose they cannot be required to be disclosed: the Bill prohibits such access. But we believe that if keys have been used for the purposes of confidentiality it is right that they may be required to be disclosed.
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In all this it is important to have in mind that we envisage that the times when keys themselves will be required to be disclosed will be limited. The choice of which key to disclose, if there is more than one which can decrypt the relevant information, is very much left to the recipient of the notice.
Amendment No. 158 seeks to address the possibility that keys which may once have been used for the purposes of confidentiality, but have not been so used for some time, may be required to be disclosed because of some recent malicious behaviour by a party who is not the keyholder. We are aware that such a scenario has been painted, but we believe that those fears are overstated. The fact remains that the Bill needs to cover keys which have been used for the purpose of confidentiality and signature. We believe that there are appropriate tests and restrictions that govern access to keys and that Clause 46(6) provides necessary, proper and adequate safeguards for signature keys.
Clearly, confidentiality and integrity are key factors—no pun intended. We understand the spirit in which these amendments and the others in the group are tabled. I trust that, following my comments on Amendments Nos. 157 and 158, the noble Earl will feel able to withdraw his amendment.
Lord McNally: This is a key point. I flipped through some papers that I received from Japan where people have gone to great lengths to guarantee and protect signature keys. They regard that as a key part of public confidence in commerce in this area. I thank the Minister for his reassurances on this matter.
The Earl of Northesk: I believe that I am satisfied with the Minister's response to my own amendments. There is slight confusion. As ever, I shall read Hansard further to inform me on the point. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 139C not moved.]
Lord Bach Lord Bach moved Amendment No. 139D:
Page 50. line 10. leave out ("requirement to disclose the key") and insert ("disclosure requirement in respect of the protected information").
On Question, amendment agreed to.
[Amendments Nos. 140 to 141A not moved.]
Lord Bach Lord Bach moved Amendment No. 141B:
Page 50, line 17, leave out from ("that") to ("without") in line 18 and insert ("it is not reasonably practicable for the person with the appropriate permission to obtain possession of the protected information in an intelligible form").
On Question, amendment agreed to.
[Amendments Nos. 142 to 144 not moved.]
Lord Bach Lord Bach moved Amendment No. 144A:
Page 50, line 21, leave out ("require the disclosure of the key") and insert ("impose a disclosure requirement in respect of the protected information").
On Question, amendment agreed to.
[Amendments Nos. 144B and 144C not moved.]
Lord Bach Lord Bach moved Amendment No. 144D:
Page 50, line 22, leave out ("requirement to disclose a key") and insert ("disclosure requirement in respect of any protected information").
On Question, amendment agreed to.
[Amendment No. 144E not moved.]
Lord Bach Lord Bach moved Amendment No. 144F:
Page 50, line 27, leave out ("requiring the disclosure of any key") and insert ("imposing a disclosure requirement in respect of any protected information").
On Question, amendment agreed to.
[Amendment No. 144G not moved.]
Lord McNally Lord McNally moved Amendment No. 145:
Page 50, line 28. leave out ("not in writing)") and insert ("given by electronic means)").
The noble Lord said: The intention is to clean up the form and content of notices. I beg to move.
The Earl of Northesk: Amendment No. 151A is grouped with this amendment. I trust that the Committee will think it convenient if I speak to it.
I return to an argument I advanced in debate on the first amendment we considered on the previous Committee day. It is ludicrous that Clause 46 notices,
"may take such form and be given in such manner as the person giving it thinks fit".
I believe that that affords carte blanche to the subjective opinion of anyone with the appropriate permission under Schedule 1 to compile their own versions of Clause 46 notices.
My amendment seeks to address the need for objectivity rather than subjectivity. The provision has the potential of imbuing the regime with uncertainty and an unwelcome lack of clarity. I might have preferred the noble Lord, Lord McNally, to have spoken to his Amendment No. 151, which I believe seeks to deal with the problem from a different perspective. None the less, I look forward to the Minister's reply.
Lord Bassam of Brighton: I shall deal with the entire grouping, if I may. There are a number of amendments in this group relating to the nature of notices served under Clause 46. Some of the government amendments which we have already discussed have an impact on these amendments. I should like, first, to set out the rationale behind the amendments in this group.
Government Amendment No. 149XA should be welcomed. The amendment is tabled expressly as a result of representations from industry. Many in industry have been concerned that, notwithstanding the constraint on service of notices, some "spoof" notices purporting to be under the Bill could be served on companies and, in this way, security of companies could be compromised. No one wants that. We are anxious to minimise the possibility of any such spoof notices. We believe that the requirement in Amendment No. 149XA—that the office, rank or
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position of the person who granted permission for the giving of a notice under Schedule 1 be on the face of the notice—will add extra reassurance to those who received notices that those notices are genuine.
Amendments Nos. 149YA and 150ZA relate to the information that is to be on a notice served under Clause 46. These changes are consequential on the earlier restructuring of the balance between keys and plain text.
Amendments Nos. 150B and 158A are also consequential on the requirement, covered in the new clause tabled by the Government, that notices should be served on directors of companies or equivalent. As such, I hope that these, along with the other government amendments, will be welcomed by the Committee.
There are some outstanding issues from this group which I should address. Amendment No. 145 seeks to clarify that decryption notices can be given only in writing or by electronic means. I can see what the noble Lord is driving at. But I believe that the amendment is unnecessary. Our position on the form of decryption notices is this. They will be in written form. In time, we anticipate that, where necessary and applicable, they should be capable of being served electronically. I think that that is what the noble Lord seeks. But that is already catered for by the words in Clause 46(4)(a),
"or (if not in writing) must be given in a manner that produces a record of its having been given".
In another place, we amended Clause 46(4) to put on the face of the Bill further stipulations about the form a decryption notice should take. We have continued that process today. This is in response to industry concerns about the possibility of receiving spoof notices. There is no intention that notices should be given verbally with no written back up. As the Government said in another place, there is clearly a need for consistency regarding notices, for the sake of those authorising and serving notices and for the sake of those receiving them, be it individuals or business.
There should be an agreed format to notices. How that looks in practice is properly to be the subject of consultation with industry, of course, and others. The Government want to get this right in order to achieve clarity and best practice. It will be taken forward in the public consultation on the code of practice for Part III, which will suggest an example of the notice.
Amendment No. 146, tabled by the noble Lord, Lord McNally, seeks to ensure that there should also be a record of the notice having been received. I do not argue with the intent of that amendment. I question whether it is necessary. If notices are not received, then nobody is under any duty to comply with them. If there were to be a prosecution for non-compliance, the prosecution would have to prove that the notice was duly served. Therefore, it is in the interests of law enforcement to be able to show that the notice was indeed received. For these reasons the Government believe that what the Bill currently stipulates is as much as is necessary.
At least part of Amendment No. 146A is dealt with by the new clause tabled earlier by the Government requiring notices to be served on a director or

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equivalent within a company. As regards the other part of that amendment, that the notice should specify the person to whom the notice is given, it is believed that that would be good practice in accordance with the code of practice which will be issued for that part of the Bill.
The Government believe that the important requirements are already covered by subsection (4) of the clause as the Government propose it should be amended. It is not believed that the addition suggested in Amendment No. 146A will add to the verification process.
Amendment No. 148 seeks to ensure that the notice specifies which of the purposes listed in Clause 46(3) is applicable. That is certainly how the Government intend notices to be framed. That will be clarified in the code of practice.
It is believed that the intent of Amendment No. 149 is met by government Amendment No. 149XA, and, for that reason, the noble Lord is requested to withdraw Amendment No. 149.
The Government do have some sympathy with the intention behind Amendment No. 151. It is the intention of the Government that notices should be served in line with the guidance in the code of practice. There may, however, be some circumstances in which it is not possible, or not possible precisely to follow what is set out in the code. The Government undertake to consider the matter further to explore whether there is any extra reassurance that can be offered on the face of the Bill.
Amendment No. 155 seeks to ensure that where material is disclosed to an individual who is not the person giving the notice, that person should be in the same category of person as the person giving the notice. It is believed that that will remove a degree of flexibility which will be important.
Take for example the Technical Assistance Centre: where keys are to be demanded, it may be that secure transmission conditions require that the key be disclosed direct to the Technical Assistance Centre rather than the person giving the notice. Staff at the Technical Assistance Centre will be selected for their technical proficiency and their security classification rather than for the rank which they hold in a particular organisation. It is believed that the stricture required by Amendment No. 155 may limit the flexibility required in terms of secure transmission to the TAC, and for that reason it is resisted. It is to be hoped that it can be agreed that the primary objective here in the rare cases where keys are demanded is that there will be transmission. That is the objective.
I have outlined the reasons behind the Government's amendments in this group. I have also outlined why the Government do not feel able to accept the amendments of the noble Lords opposite. In one case, the offer has been made to consider the matter further. In other cases, the intent of the noble Lords' amendments is, I believe, already met by those tabled by the Government.
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In the light of those considerations, it is to be hoped that noble Lords will feel able to withdraw their objections. I commend the Government's amendments to the Committee and resist those tabled by Members opposite.
Lord McNally: There were a large number of reassurances in the Minister's reply. As I said, the intention of these amendments was to try to tighten up and clarify these procedures. Some of the amendments have indeed been overtaken by the Government's own amendments.
Regarding the amendments tabled by the noble Earl, Lord Northesk, they look similar and are probably better than ours. I beg to leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 146 to 149 not moved.]
Lord Bach Lord Bach moved Amendments Nos. 149XA and 149YA:
Page 50, line 33, at end insert—
("( ) must specify the office, rank or position of the person who for the purposes of Schedule I granted permission for the giving of the notice or (if the person giving the notice was entitled to give it without another person's permission) must set out the circumstances in which that entitlement arose:").
Page 50, line 34, leave out paragraph (e).
On Question, amendments agreed to.
Lord Lucas Lord Lucas moved Amendment No. 149ZA:
Page 50, line 36, at end insert—
("( ) may contain a requirement as described in section 50(1), and may in exceptional circumstances forbid the taking of action to preserve the confidentiality of other communications;").
The noble Lord said: I shall not press the amendment. If the Minister wants to comment on it, that is up to him. Neither shall I speak to Amendment No. 162A in the group; we have covered that subject. The amendment merely suggests another way in which, in the tiny number of cases in which the key will be demanded, we can obtain high-level authorisation. If it cannot be obtained from a judge, it should come from the interception of communications commissioner.
I shall speak to Amendment No. 176ZA with Amendment No. 171 because the two go together. If the Minister wants to comment on them now, I shall listen to him with great interest. I beg to move.
Lord Cope of Berkeley: My Amendment No. 178 refers to the secrecy of a key once it has been obtained. It is most important that all concerned should be reassured about that. If the Minister can point to a provision in the Bill which places a duty on the authorities concerned to maintain the secrecy, I shall not press my amendment. However, it is important that the provision is written into the Bill somewhere.
Lord McNally: Amendment No. 179 is almost identical to Amendment No. 178. I say merely that the

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representations I have received indicate a real concern about the security of the key once it enters the government machine, partly because it undermines international confidence. Part of the problem with the Bill relates to differences of perception. The men or women in Whitehall are confident that their remarks and assurances will satisfy any reasonable person who knows how Whitehall or public bodies work, but it is not reassuring to those who are dealing with international companies or trying to maintain business confidence. These are important issues and, like the noble Lord, Lord Cope, I look for guidance and assurance from the Minister.
Lord Bassam of Brighton: I shall deal with all the amendments in the group, from Amendment No. 176ZA onwards. That amendment covers ground to which we will come when we discuss the amendments relating to the tipping-off offence. I believe that the concern is that some legitimate action will be caught by the tipping-off offence. When we come to the group of amendments, I shall explain why, for example, revocation of keys—a device for ensuring the confidentiality of systems—does not fall foul of the offence. Similarly, Clause 51 does not prevent or penalise other legitimate action taken to preserve confidentiality.
Amendment No. 149ZA is most perceptive. I believe that the noble Lord is seeking to be helpful with his proposal. We had thought about including such a provision in the Bill, but, in the event, we decided against it. We believe that there would need to be some kind of' additional test for forbidding such action, perhaps including "reasonable" and "proportionate", as well as "exceptional". Again, it is a question of the delicate balancing exercise which we hope we have constructed properly.
In some instances we are simultaneously criticised for being too draconian in the Bill and for not giving law enforcement officers sufficient powers. It is difficult to get the balance right. Certainly it is difficult to satisfy both ends of the argument. Therefore, we decided not to proceed with a provision along the lines of that set out in the noble Lord's amendment. However, we hint at it in Clause 50(4)(b) as part of the defence where particular software is designed to disclose the fact that a key has been revealed. However, I am grateful to the noble Lord for having raised that particular point.
From my understanding, Amendment No. 162A tries to add an extra safeguard in cases where keys may be required under a disclosure notice. However, the interception commissioner will not necessarily be the appropriate oversight point for all cases where a key may be demanded. We believe that that nullifies the intended effect of the amendment.
I turn to Amendments Nos. 178 and 179. I appreciate the spirit behind these amendments. In particular, I take the point made by the noble Lord, Lord McNally, about international confidence. He is right. It has much to do with perceptions. Perhaps we have embarked upon this erroneously, but I believe that all Members of the Committee can be helpful in
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trying to add that reassurance to the Bill. That is why I particularly welcome the spirit behind the amendments.
As Members of the Committee will be aware, we resisted a similar amendment in another place. However, as with the other issues connected with Part III, we recognise fully that the question of secure handling of keys is of critical importance. I am happy to set out our position again.
First, it is worth stressing that we understand the need to store securely all sensitive material obtained under the Bill. As regards keys obtained lawfully under Part III, Clause 51 already sets out strong safeguards which govern the retention, copying, destruction and treatment generally of material otherwise obtained under the new powers. I believe that the safeguards are described in very practical terms.
We are not convinced that the addition of the word "safely" is at all necessary. As I said, we set out in practical terms the safeguards provisions which must be in place; for example, with regard to limiting the extent of disclosure. Similar considerations apply to the sensitive material obtained under interception warrants. It is the case now that material obtained lawfully under existing interception powers is held very securely. The reasons for that are plain to see. However, as with the case for Part III, the relevant safeguards provisions which cover interception in Clause 14 of Part I do not contain a specific requirement for material to be held safely. I believe that that point was debated earlier in Committee.
The safeguards arrangements in Clause 51 will be overseen by independent commissioners who will have a statutory responsibility to examine the adequacy and veracity of the arrangements and to report on inadequacies to the Prime Minister directly. However, that said, industry and the public at large will undoubtedly wish to be reassured that, over and above what appears on the face of the Bill, the Government are taking very seriously the issue of protecting keys. As I said, we believe that to be of fundamental importance.
Deploying the highest level of protection for keys and other sensitive information relating to key holders is a specific objective of the technical project to establish the dedicated resource—the Technical Assistance Centre—which we are putting in place to assist law enforcement in relation to encryption.
As Members of the Committee will have seen, the Chancellor of the Exchequer has made available to the Home Office £25 million of modernisation capital to establish that facility. Work is in progress. Security is paramount, including the security of data and keys being transported to the centre, whether physically or electronically. The commissioners will have access to the facility. It is essential to provide reassurance that it is properly executing functions derived from the legislation.
Clause 51 already sets out strong safeguards governing the handling of keys. We take the issue seriously. Questions of technical, physical security sire being taken forward by the project to establish the

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TAC. I hope that, with that fairly lengthy explanation, for which I apologise, the noble Lord will feel able to withdraw the amendment.
9.30 p.m.
Lord Lucas: I am grateful for that explanation. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Northesk The Earl of Northesk moved Amendment No. 149A:
Page 50, line 37. leave out ("the time by") and insert ("a period, not exceeding 40 days, within").
The noble Earl said: With your Lordships' leave, I shall speak also to Amendment No. 150A.
I concede that my choice of 40 days is arbitrary. I am not wedded to it. Indeed, dare I say it, I am more comfortable with the Liberal Democrat amendments.
The fundamental point on subsection (4)(f) is that the timetable for compliance should be reasonable. At least to that extent, these are probing amendments. I should be grateful to hear the Minister's views on the appropriate timescale. The underlying principle—that a Section 46 notice should have a reasonable timetable for compliance—is a sound one. I beg to move.
Lord McNally: The noble Earl, Lord Northesk, has caught the spirit of our amendments. There should be a time limit. Notices should not be left open-ended. We want the provisions to work, but they should not be left hanging over companies or individuals. We want to probe the Minister on that and I shall be interested to hear his response.
Lord Bassam of Brighton: I shall deal with the entire group. The amendments all cover the duration of Section 46 notices. Some people are concerned that they will last for ever, which might place unreasonable requirements on bodies, commercial organisations or individuals. I assure noble Lords that notices will not last for an eternity and I welcome this opportunity to explain our thinking behind the current wording.
Amendments Nos. 149A, 150A and 152 would all limit the duration of notices—each in a slightly different way. The noble Earl, Lord Northesk, said that he was not wedded to 40 days. I thought that it was a Biblical reference—40 days and 40 nights—and I am impressed that he used it.
The fears about the duration of notices are misplaced. I shall try to offer some reassurance. It would not be right for a Section 46 notice to last beyond the period for which the seeking of information could be justified as necessary. There are a series of measures in the Bill to achieve that.
Clause 46(2) states that a person may serve a notice only if he believes that its imposition is necessary or likely to be of value and it must be proportionate to what he is trying to achieve. So, clearly, a notice with a long duration would be entirely inappropriate in minor cases.
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Secondly, Clause 46(4)(f), as currently drafted, requires that the notice should specify the time by which the disclosure is to be made. Again, a notice which required disclosures to be made ad infinitum would be hard to justify on any ground, proportionality included.
Thirdly, it is important to remember that the decryption power in Part III of this Bill is merely ancillary to existing powers. Clause 51(2)(a) requires that a key disclosed in pursuance of a notice is only used to access information in relation to which power to give such a notice was exercised, or could have been exercised if the key had not already been disclosed. In other words, the duration of notices will in general be tied explicitly to the duration of the underlying statutory power. So, for example, where an interception warrant is authorised for three months, the ancillary Clause 46 notice will expire shortly after the date when the warrant expires, or be renewed along with it. Search warrants under the Police and Criminal Evidence Act 1984 usually expire after 28 days. Again, a relevant Clause 46 notice would expire shortly afterwards.
Fourthly, the code of practice for Part III will set out in considerable detail appropriate duration periods for different types of notice. As we have said many times, we shall consult on the code, which is of course subject to the affirmative resolution procedure.
To sum up, there are already measures in the Bill to ensure that notices may not last for ever, as some have mistakenly believed.
I turn now to Amendment No. 153. Similar concerns about the duration of notices lie behind this amendment. But what is proposed in this amendment is unnecessary. Clause 46(2) already ensures that notices may be served only where the imposition of a disclosure requirement is necessary and proportionate. Those tests remain in place under the new construction that we are proposing for Clause 46.
Amendment No. 150 suggests that a person served with a notice should be given a reasonable time to comply with it, and that the authorising officer should take account of the technical difficulties of performing the disclosure in setting a requirement by when compliance must take place. We resisted a similar amendment in Committee in another place. I shall reiterate what we said then.
What constitutes a "reasonable" time to comply with a notice will undoubtedly vary from case to case and will depend on a number of factors. The technical capacity or expertise of the body or individual on whom the notice is served is one consideration. But it is not the only one. Whether there are particular time pressures on an investigation is clearly another consideration. Would it be reasonable, for example, to require an urgent response to a notice in genuine life and death circumstances? We might legitimately argue that it would. In other cases, a slower response might suffice. But those are questions for the person authorising the use of the decryption power to properly weigh up in the light of the particular circumstances of the case. We shall cover all those issues in the code of practice.

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As we also pointed out, the Bill as drafted provides a reasonable safeguard against unreasonable demands being made at Clause 49(3)(a) by providing a defence to the offence of failure to comply. We retain that defence in the new construction of the offence in Clause 49.
I hope that that full explanation will enable the noble Earl to withdraw the amendment.
The Earl of Northesk: I am grateful to the Minister for his response, which was, indeed, helpful. It may be that we shall return to this matter at a later stage. I remain keen on phraseology along the lines of "reasonable in the circumstances", but I take the Minister's point in relation to the code of practice, which I hope it will be possible for us to see. For the moment at least, I beg leave to withdraw the amendment.
Amendment. by leave, withdrawn.
[Amendment No. 150 not moved.]
Lord Bach Lord Bach moved Amendment No. 150ZA:
Page 50, line 38, leave out paragraph (g) and insert—
("( )must set out the disclosure that is required by the notice and the form and manner in which it is to be made;").
On Question, amendment agreed to.
[Amendment No. 150A not moved.]
Lord Bach Lord Bach moved Amendment No. 150B:
Page 50, line 40, after ("(a)") insert ("and subsections (4A) and (4B)").
On Question, amendment agreed to.
[Amendments Nos. 151 to 152 not moved.]
Lord Bach Lord Bach moved Amendment No. 152A:
Page 50, line 41, at end insert—
("(4A) Where it appears to a person with the appropriate permission—

(a) that more than one person is in possession of the key to any protected information,

(b) that any of those persons is in possession of that key in his capacity as the officer or employee of any body corporate, and

(c) another of those persons is the body corporate itself or another officer or employee of the body corporate,

a notice under this section shall not be given, by reference to his possession of the key, to any officer or employee of the body corporate unless he is a senior officer of the body corporate or it appears to the person giving the notice that there is no senior officer of the body corporate and (in the case of an employee) no more senior employee of the body corporate to whom it is reasonably practicable to give the notice.
(4B) Where it appears to a person with the appropriate permission—

(a) that more than one person is in possession of the key to any protected information,

(b) that any of those persons is in possession of that key in his capacity as an employee of a firm, and

(c) another of those persons is the firm itself or a partner of the firm,
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a notice under this section shall not be given, by reference to his possession of the key, to any employee of the firm unless it appears to the person giving the notice that there is neither a partner of the firm nor a more senior employee of the firm to whom it is reasonably practicable to give the notice.

(4C) Subsections (4A) and (4B) shall not apply to the extent that there are special circumstances of the case that mean that the purposes for which the notice is given would be defeated, in whole or in part, if the notice were given to the person to whom it would otherwise be required to be given by those subsections.").
On Question, amendment agreed to.
[Amendments Nos. 153 and 153A not moved.]
Lord Bach Lord Bach moved Amendment No. 153B:
Page 50, line 42, leave out ("disclosure of a key") and insert ("making of any disclosure").
On Question, amendment agreed to.
[Amendments Nos. 154 to 158 not moved.]
Lord Bach Lord Bach moved Amendment No. 158A:
Page 51. line 5, at end insert—
("( ) In this section "senior officer", in relation to a body corporate, means a director, manager, secretary or other similar officer of the body corporate: and for this purpose "director". in relation to a body corporate whose affairs are managed by its members, means a member of the body corporate.").
On Question, amendment agreed to.
Clause 46, as amended, agreed to.
Lord Bach Lord Bach moved Amendment No. 158B:
After Clause 46, insert the following new clause—

Regulation of Investigatory Powers Bill

  EFFECT OF NOTICE IMPOSING DISCLOSURE REQUIREMENT
  (".—(1) Subject to the following provisions of this section, the effect of a section 46 notice imposing a disclosure requirement in respect of any protected information on a person who is in possession at a relevant time of both the protected information and a means of obtaining access to the information and of putting it into an intelligible form is that he—

  (a) shall be entitled to use any key in his possession to obtain access to the information or to put it into an intelligible form; and

  (b) shall be required, in accordance with the notice imposing the requirement, to make a disclosure of the information in an intelligible form.

  (2) A person subject to a requirement under subsection (1)(b) to make a disclosure of any information in an intelligible form shall be taken to have complied with that requirement if—

  (a) he makes, instead, a disclosure of any key to the protected information that is in his possession; and

  (b) that disclosure is made, in accordance with the notice imposing the requirement, to the person to whom, and by the time by which, he was required to provide the information in that form.

  (3) Where, in a case in which a disclosure requirement in respect of any protected information is imposed on any person by a section 46 notice—

  (a) that person is not in possession of the information.

  (b) that person is incapable, without the use of a key that is not in his possession, of obtaining access to the information and of putting it into an intelligible form, or

  (c) the notice states, in pursuance of a direction under section 47, that it can be complied with only by the disclosure of a key to the information,

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  the effect of imposing that disclosure requirement on that person is that he shall be required, in accordance with the notice imposing the requirement, to make a disclosure of any key to the protected information that is in his possession at a relevant time.

  (4) Subsections (5) to (7) apply where a person ("the person given notice")—

  (a) is entitled or obliged to disclose a key to protected information for the purpose of complying with any disclosure requirement imposed by a section 46 notice: and

  (b) he is in possession of more than one key to that information.

  (5) It shall not be necessary, for the purpose of complying with the requirement, for the person given notice to make a disclosure of any keys in addition to those the disclosure of which is, alone, sufficient to enable the person to whom they are disclosed to obtain access to the information and to put it into an intelligible form.
  (6) Where—

  (a) subsection (5) allows the person given notice to comply with a requirement without disclosing all of the keys in his possession, and

  (b) there are different keys, or combinations of keys, in the possession of that person the disclosure of which would, under that subsection, constitute compliance,

  the person given notice may select which of the keys, or combination of keys, to disclose for the purpose of complying with that requirement in accordance with that subsection.
  (7) Subject to subsections (5) and (6), the person given notice shall not be taken to have complied with the disclosure requirement by the disclosure of a key unless he has disclosed every key to the protected information that is in his possession at a relevant time.
  (8) Where, in a case in which a disclosure requirement in respect of any protected information is imposed on any person by a section 46 notice—

  (a) that person has been in possession of the key to that information but is no longer in possession of it,

  (b) if he had continued to have the key in his possession, he would have been required by virtue of the giving of the notice to disclose it, and

  (c) he is in possession, at a relevant time, of information to which subsection (9) applies,

  the effect of imposing that disclosure requirement on that person is that he shall be required, in accordance with the notice imposing the requirement, to disclose all such information to which subsection (9) applies as is in his possession and as he may be required, in accordance with that notice, to disclose by the person to whom he would have been required to disclose the key.
  (9) This subsection applies to any information that would facilitate the obtaining or discovery of the key or the putting of the protected information into an intelligible form.
  (10) In this section "relevant time", in relation to a disclosure requirement imposed by a section 46 notice, means the time of the giving of the notice or any subsequent time before the time by which the requirement falls to be complied with.").
  On Question, amendment agreed to.
  [Amendment No. 158C not moved.]
  Lord Bach Lord Bach moved Amendment No. 159:
  Before Schedule 1, insert the following new schedule—

  PART I RELEVANT AUTHORITIES FOR THE PURPOSES OF SS. 27 AND 28

    Police forces etc.
    1. Any police force.
    2. The National Criminal Intelligence Service.
    3. The National Crime Squad.
    4. The Serious Fraud Office.

    5. Any of the intelligence services.
    The armed forces
    6. Any of Her Majesty's forces.

    The revenue departments
    7. The Commissioners of Customs and Excise.
    8. The Commissioners of Inland Revenue.

    Government departments
    9. The Ministry of Agriculture, Fisheries and Food.
    10. The Ministry of Defence.
    11. The Department of the Environment, Transport and the Regions.
    12. The Department of Health.
    13. The Home Office.
    14. The Department of Social Security.
    15. The Department of Trade and Industry.

    16. The National Assembly for Wales.
    Local authorities
    17. Any local authority (within the meaning of section 1 of the Local Government Act 1999).

    Other bodies
    18. The Environment Agency.
    19. The Financial Services Authority.
    20. The Food Standards Agency.
    21. The Intervention Board for Agricultural Produce.
    22. The Personal Investment Authority.
    23. The Post Office.

  PART II RELEVANT AUTHORITIES FOR THE PURPOSES ONLY OF S. 27
    24. The Health and Safety Executive.

    NHS bodies in England and Wales
    25. A Health Authority established under section 8 of the National Health Service Act 1977.
    26. A Special Health Authority established under section 11 of the National Health Service Act 1977.
    27. A National Health Service trust established under section 5 of the National Health Service and Community Care Act 1990.

    The Royal Pharmaceutical Society of Great Britain
    28. The Royal Pharmaceutical Society of Great Britain.").
    On Question, amendment agreed to.
    Schedule 1 [Persons having the appropriate permission]:
    Lord Cope of Berkeley Lord Cope of Berkeley had given notice of his intention to move Amendment No. 159A:
    Page 83, line 1, leave out paragraph 4.
    The noble Lord said: The issues pertaining to Amendment No. 159A were discussed when dealing with the related amendments grouped with Amendment No. 139A. Therefore, I do not propose to move it.
    [Amendment No. 159A not moved.]
    [Amendment No. 159B not moved.]
    Schedule 1 agreed to.
    Clause 47 [Disclosure of information in place of key]:
    Lord Bach Lord Bach moved Amendment No. 159C:
    Page 51, line 7, leave out from beginning to ("unless") in line 21 and insert—
    ("(1) A section 46 notice imposing a disclosure requirement in respect of any protected information shall not contain a statement for the purposes of section (Effect of notice imposing disclosure requirement)(3)(c)").
    On Question, amendment agreed to.
    [Amendments Nos. 160 and 161 not moved.]
    Lord Bach Lord Bach moved Amendment No. 161A:
    Page 51, line 23, leave out ("a section 46") and insert ("the").
    On Question, amendment agreed to.
    [Amendments Nos. 162 to 164A not moved.]
    Clause 47, as amended, agreed to.
    Clause 48 [Arrangements for payments for key disclosure]:
    [Amendment No. 164A A not moved.]
    Clause 48 agreed to.
    9.45 p.m.
    Clause 49 [Failure to comply with a notice]:
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 164AB:
    Page 52, line 2, leave out from ("person") to end of line 6 and insert ("to whom a section 46 notice has been given is guilty of an offence if he fails, in accordance with the notice, to make the disclosure required by virtue of the giving of the notice.").
    The noble Lord said: I am happy to deal with this group of amendments if the Committee so desires. I understand entirely the motives behind the amendments in the group. We have been considering whether or not the offence at Clause 49 can be redrafted so as to retain its effectiveness while removing any potential for harm to justice. It will be noted that we tabled Amendments Nos. 164AB, 167B, 167C and 167D as a result of our deliberations.
    These are difficult issues and it is a difficult offence to formulate. It involves many technicalities—the possession of a key—which it will be difficult for the prosecution to prove. However, I shall try to address the amendments as briefly as I can.
    Amendments Nos. 164B and 164C seek to introduce the notion of intent into the offence. It is said that it should not he enough for the prosecution simply to
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    prove that an individual did not comply with the notice, but also that there should have been some intent on their part. We resisted this in the past and shall continue to do so. A Section 46 notice will impose a legal burden. The offence is clear. It is simply a failure to comply with the notice. There is of course a defence for those who were not able to comply because it was not practical to do so.
    I can be more helpful on Amendment No. 164C. This would say that a person is only guilty if he intentionally fails to comply; in other words, a person who fails to comply because he never received the notice or through sheer inadvertence is not guilty. We do not feel the strict liability which the offence imposes is onerous or unjust and do not believe the amendment is necessary. In the light of what I have said, I hope that Members of the Committee will agree that to raise the burden on the prosecution any higher would be unnecessary and would remove the efficacy of the deterrent. I hope noble Lords will consider not moving those amendments.
    In Amendment No. 164D the noble Earl, Lord Northesk, seeks to add a stipulation that the offence will only work where someone failed to comply with a valid notice served under Section 46. We agree with the sentiment behind this amendment but believe it to be a clarification too far. There can be no question, under the Bill as currently drafted, that the offence will only work if the Section 46 notice is valid.
    Turning to Amendment No. 165, there are difficulties with the notion of proving that a person,
    "has had possession of the key".
    Let me spell out why the Government included this in Clause 49(1)(b). This limb to the offence is included not because we intend that people should be prosecuted where they have had possession of a key but have no longer got it when they are served with a notice; that is not now and never has been our intention. Rather, this part of the offence is there as explicit recognition of the extreme difficulty of prosecuting these offences.
    The real issue created by the second limb of the offence is what burden is placed on the defendant where the prosecution has only been able to prove prior possession of the key. We have tabled an amendment making it clear that where the prosecution has been able to prove previous possession, that alone cannot lead to a conviction if the defendant raises some doubt as to whether or not he stilt has the key. I believe that that will deal with the issue addressed by Amendment No. 165.
    Amendment No. 166 tries to add the possibility that the prosecution need only prove possession of a key or that someone was reasonably able to obtain such possession. I believe that that possibility is already provided for in Clause 52(2), to which we have tabled a slight amendment. Amendment No. 166 is therefore unnecessary and I ask the noble Lord not to move it.
    Amendments Nos. 167 and 167A. come from broadly the same motives. Amendment No. 167A includes the notion of intention, with which I dealt in my comments on Amendments Nos. 164B and 164C.

    1009
    The rest of the thrust of Amendments Nos. 167 and 167A deals with the time by which a person may have had possession of a key and the difficulties caused by including in Clause 49(1)(b) the notion that a person may be guilty of an offence where he,
    "has had possession of the key".
    Those issues are addressed by government amendments.
    We have tabled amendments that make it clear that proof of previous possession can lead to a conviction. However, it will not do so if the defendant raises an issue about whether he still has possession of the key. Once that happens, the burden falls back on the prosecution in the normal way. I believe that that will deal with the issue addressed by Amendments Nos. 167 and 167A. Accordingly, I hope that noble Lords will not press those amendments.
    Lawyers refer to this as placing an "evidential" burden on the defendant, as opposed to a "persuasive" or "legal" burden. It means that the defendant simply has to raise some evidence to discharge the burden. That could be done, for example, by the defendant going into the witness box and saying that he has lost his key, or by producing some evidence that his system has crashed.
    I believe that I understand the intent behind Amendment No. 168. In providing for a defence to the offence under Clause 49, the noble Lord, Lord Lucas, wishes to ensure that it will be sufficient for an individual to hand over any key that enables possession of the information to be obtained rather than a key that is specifically demanded. As I said earlier, it will not be possible under the Bill for the authorities to identify a specific key that they wish to be handed to them—rather, they must identify the protected information in question. That being the case, any key that unlocks the protected information will work for the purposes of the defence at Clause 49(3)(c). Again, we have tabled amendments to make that clearer.
    Amendment No. 168A tabled by the noble Earl, Lord Northesk, is an attempt to make it plain on the face of the Bill that, where a key has been destroyed as part of routine practice designed to protect confidentiality, this should be a defence against any prosecution. Once more, that is already catered for in the Bill as drafted. All the circumstances set out in this amendment would undoubtedly meet the threshold required to be proved by a defence in a case where previous possession has been proved. Indeed, in as far as this amendment only provides for destruction of keys as part of "routine" practice, it may not go as far as the current situation outlined under the clause as drafted. As currently drafted—and even more so if government amendments are accepted—it should be enough just to explain that a key has been destroyed in a particular set of circumstances.
    Amendment No. 168B seeks to lower the burden of proof on the defendant in this case to an evidential burden. I am sure that Members of the Committee will have noticed that a similar amendment has been tabled
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    under my name. However, there is one significant difference. As drafted, Amendment No. 168B would seek to lower the burden of proof on the defendant in those cases where his defence is that compliance with the requirement was impractical. The Government's intention is only to apply this to the defence of showing lack of possession.
    We do not see the need to lower the burden on the defendant as outlined in this amendment. This defence is for someone who, on the face of it, has committed the offence. The notice has been proved to have been served on him; he has been proved to be in possession of the key; he has not complied with the notice; but he is claiming that there are circumstances which made it impractical for him to comply. Necessarily, those circumstances are within his knowledge. Therefore, it must be for him to show them. In the light of this and the changes proposed by the Government, I ask noble Lords not to press the amendment.
    The discussion that we are having on Amendments Nos. 168C and 169A was forecast at Second Reading and also in another place. Although I share to a considerable extent the concerns expressed and can see the attractions in moving in the direction proposed, I believe that there are constraints on us in this respect. In the final analysis, I do not believe that we can make such a move.
    Amendment No. 168C is a very straightforward proposition—the maximum sentence for failure to comply with a Clause 46 notice should be 10 years, not two. This would be designed specifically to cater for the circumstance in which an individual sought to conceal his activities by not handing over a key in the full knowledge that, were his activities to be revealed, he would be facing a much longer sentence. How will the prosecuting authorities, or the judiciary, ever know the nature of protected information in a case where an individual has not complied with a Section 46 notice?
    I share some of the frustrations of those who seek to move these amendments, but we need to focus on the offence in question. The offence is not complying with a notice under Section 46. By any view, a sentence of 10 years for such an offence must be disproportionate.
    I turn to Amendment No. 169. I believe that in the fundamental interests of justice we must focus on the offence at Clause 49. That offence is failure to comply with a notice served under Section 46. By definition, if someone fails to comply with a Section 46 notice, the prosecution will not know the nature of the material that has been protected. They may have strong suspicions but they cannot know what the material is.
    Even where the nature of other charges against an individual may lead one to have suspicions that the material has been protected, I still believe that the interests of justice dictate that the sentence for this offence must focus solely on what that offence is. I believe that a situation in which a person can be convicted of, say, an offence of unlawful possession on the assumption that unknown material is treated as incriminating risks offending against the presumption of innocence. I appreciate that Amendment No. 169 involves a different way of trying to achieve a similar

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    objective to that in Amendments Nos. 168C and 169A. We need to focus on the offence. For that reason we believe that the appropriate sentence for this particular offence should not exceed a two year prison term and/ or fine.
    I have outlined our views in detail and I have tried to draw attention to the issues which I think are dealt with by the Government amendment in this group. In the light of that I ask noble Lords not to move their amendments. I beg to move.
    Lord Phillips of Sudbury: I thank the Minister for Amendments Nos. 167B to 167D, which go to the very heart of the unease felt on these Benches—and, indeed, on the Government's own Benches—about the standard of proof which prevailed in this important clause. As the noble Lord, Lord Bassam, pointed out in the course of rejecting one of the amendments in the group, the maximum sentence for breaching this clause is two years' imprisonment and a fine.
    I shall speak briefly to Amendments Nos. 164B and 167, which stand in my name and those of my colleagues. We propose to withdraw Amendments Nos. 167A and 168B. However, I hope that I may raise just one point on the question of intent, on mens rea, in relation to offences under Clause 46. Given that it is a serious criminal offence, I am not content merely to have the Minister assert that the Government do not propose in this case to apply the normal test which is basic to our criminal legal system; namely, that there should be no serious criminal offence found without an intent to commit the crime. The Minister might, in responding to this short debate, say something about that.
    The second point I wish to raise concerns our Amendment No. 167. In our view, there is virtue—I believe that others share this approach—in requiring any notice to be time limited so that the person or persons to whom it is addressed know where they are in terms of the length of its validity. Our proposed Amendment No. 167 is probing in this regard. Again, I should be glad if the Minister could say whether he sees any problem with that because it seems to us that a time limit is a practical and sensible restriction on the scope of the notices.
    Finally, I raise two questions of interpretation on government Amendments Nos. 167B and 167C. Amendment No. 167B provides that if it is shown that a person was in possession of a key and so on, certain consequences flow. I should like to refer to the key phrase,
    "if it is shown that that person was in possession of a key".
    Is that, as I hope and assume it is, a test on the balance of probabilities and not therefore a test beyond reasonable doubt? If that is correct—I believe it to be so—we have no trouble with it. If, on the other hand, the person who is at risk under that provision has to show at that stage beyond reasonable doubt, we do not think that the amendment works.
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    My second query is in relation to the crucial amendment, Amendment No. 167C. Paragraph (a) states that,
    "sufficient evidence of that fact is adduced to raise an issue with respect to it".
    "Sufficient evidence", I assume and hope, in this context means prima facie evidence and does not mean a balance of probabilities. We are content with the arrangements proposed under this amendment to throw the burden of proof beyond reasonable doubt back on to the prosecution but only if the evidence—the sufficient evidence that has to be produced by the accused—is prima facie evidence. Subject to those points, we are content with the amendments tabled by the Government.
    10 p.m.
    The Earl of Northesk: Perhaps I may comment very briefly on the amendments standing in my name in the group. I think I am content with the Minister's response to Amendment No. 164D. I shall certainly read the Minister's comments with care. As to Amendment No. 168A, I am less certain. One of the many difficulties I have with the Bill is that, in its strident efforts to be technology neutral, it often conveys the impression that either it is ignorant of the way in which current technology operates, or pretends that there is no technology at all. The issue with which this amendment, Amendment No. 168A, attempts to deal is the particular case in point. I shall certainly read the Minister's comments very carefully indeed., but I suspect that this will be an issue to which I shall have to return at a later stage.
    Lord Lucas: All that Amendment No. 169 does is to try to draw a line from the current position on the right to silence—that is the right of the court to draw an inference from the silence of a defendant. What we are talking about here is just another instance of silence by a defendant. He has refused to provide a key to enable, the court to see what lies behind the files on his computer. I should have thought there should be a similar right for the court to draw conclusions from that as it sees fit.
    Lord Phillips of Sudbury: I rise to oppose Amendment No. 169. I am more used to being in alliance with the noble Lord, Lord Lucas, on these matters, but it seems to me that this is not a good analogy with the existing inferences that the courts can draw where an accused is silent. This is rather piercing the veil, as one might put it, of past convictions, which is a key foundation of our criminal law. Someone who has been found guilty in the past shall not in the course of a new trial have that past guilt around his or her neck. That would be a backward rather than a forward step, although I understand the point behind the proposal.
    Lord Cope of Berkeley: I am glad that the Government have moved on the question of burden of proof. It was important that they should do so. I shall not comment any further on the points made by Members of the Committee on that issue.

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    Amendments Nos. 164C and 168C stand in my name and are essentially a pair. They seek to draw attention to the dilemma which, along with several other noble Lords, I mentioned at Second Reading. If someone is holding incriminating evidence on his computer, he may refuse to give the key because the incriminating evidence might incur a severe sentence. In those circumstances, if it is thought that someone has done that, that person deserves to receive a sentence longer than two years because he would receive a much longer sentence if he were convicted of an offence of, say, paedophilia as a result of the police gaining access to the computer.
    However, this dilemma appears to be one that none of us can solve. I accept the Minister's point that a sentence of 10 years is a high penalty to impose in many of the cases that would be brought in this area. I fear that the dilemma remains and perhaps there is nothing that we can do about it.
    Baroness Harris of Richmond: At last I feel the urge to join in. I am delighted that my noble friends Lord McNally and Lord Phillips of Sudbury have been leading on this extremely complex Bill. I regret that I have not been able to join in the debates that have been held since Second Reading. That has not been entirely helped by the Government's change of dates for the Committee stage. However, I can assure noble Lords that I have followed the deliberations avidly.
    In the debate on Second Reading, I raised concerns about the problems surrounding the penalty for failing to disclose a key. I must say that the view expressed by the police is that they would definitely prefer to see a far more severe sentence. They feel that this offence must be an arrestable offence, along with powers of search as set out in Sections 18 and 32 of the Police and Criminal Evidence Act 1984. As it stands, serious and organised criminals might possibly risk the two-year penalty—the likely tariff would be six to 18 months—if the encrypted material could provide evidence of serious criminality such as drug trafficking or paedophilia. If convicted on that evidence, they would face prison sentences of 10 years to life. On the face of it, the penalty provides little deterrent for major criminals. I am sure that the Minister will recognise the concerns of the police here, although I note that he has given reasons why he does not feel that this can be taken any further.
    However, I agree with the Minister that a blanket 10-year sentence will not provide the answer. We need to be far more specific about what such a sentence would mean in practice. It could be a draconian measure. As the Minister said, it could well be disproportionate.
    Lord Bassam of Brighton: I believe that most of the questions that have been put to me were dealt with in my opening remarks. I do not intend to rehearse all those arguments again. There was perhaps rather too much of it even for my benefit and enjoyment.
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    However, I should like to respond to one or two questions put by the noble Lord, Lord Phillips of Sudbury. He raised a question about the way in which a matter would be considered under Amendment No. 167B. The noble Lord said that he would be satisfied if the test was made on the balance of probabilities. So far as concerns the Government, it would not have to extend even as far as that; a weaker version of it would be acceptable. I hope that helps the noble Lord.
    The noble Lord also asked the Government to look again at the issue of intent as it is covered in Clause 46. At present we hold the view that Amendment No. 164B is unworkable, but that Amendment No. 164C may be more effective. We should like to give it further detailed consideration. If the noble Lord is content, I shall return to that matter, perhaps on Report.
    Lord Phillips of Sudbury: I am grateful to the noble Lord for giving way. Is it unfair to ask why he thinks that a normal criminal test of intent is unworkable?
    Lord Bassam of Brighton: That is not what I am saying. I said that we shall look at the issue in relation to Clause 46. We believe that Amendment No. 164B is not workable, but we believe that the way the proposal is expressed in Amendment No. 164C may well be workable. It is for that reason that I want us to have the time to give it further consideration. I am not querying the issue of intent as an issue in itself and how one expresses and understands it. That is not the point of the observation.
    The noble Lord asked about "sufficient evidence". We see "sufficient evidence" as being any evidence that raises an issue. It is, if anything, less than prima facie evidence. I hope that that resolves that issue.
    The noble Baroness spoke with considerable wisdom in addressing issues relating to the penalty, as did the noble Lord, Lord Cope. But I do not think that it is an easy matter for us to resolve. Both are right, but it is a matter of getting it right for the nature of the offence. At the end of the day, it comes down to an issue of compliance. That is what we have to satisfy. Those were the main additional points which were perhaps not covered in my earlier comments.
    On Question, amendment agreed to.
    [Amendments Nos. 164E to 167A not moved.]
    Lord Bach Lord Bach moved Amendment No. 167B:
    Page 52, line 7, leave out from ("section,") to end of line 8 and insert ("if it is shown that that person was in possession of a key to any protected information at any time before the time of the giving of the section 46 notice, that person shall he taken for the purposes of those proceedings to have continued to be in possession of that key at all subsequent times, unless it is shown—").
    The noble Lord said: I have already spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Lord Bach Lord Bach moved Amendment No. 167C:
    Page 52, line 10, leave out from ("it") to end of line 14 and insert—
    ("( ) For the purposes of this section a person shall be taken to have shown that lie was not in possession of a key to protected information at a particular time if—

    (a) sufficient evidence of that fact is adduced to raise an issue with respect to it; and

    (b) the contrary is not proved beyond a reasonable doubt.").

    The noble Lord said: I have spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Lord Bach Lord Bach moved Amendment No. 167D:
    Page 52, line 16, leave out from ("defence") to end of line 31 and insert ("for that person to show—

    (a) that it was not reasonably practicable for him to make the disclosure required by virtue of the giving of the section 46 notice before the time by which he was required, in accordance with that notice, to make it; but

    (b) that he did make that disclosure as soon after that time as it was reasonably practicable for him to do so").

    The noble Lord said: I beg to move this amendment, to which I have already spoken.
    On Question, amendment agreed to.
    [Amendments Nos. 168 to 169 not moved.]
    Clause 49, as amended, agreed to.
    Baroness Thornton Baroness Thornton moved Amendment No. 169A:
    After Clause 49, insert the following new clause—

  REGISTER OF OFFENDERS
  (" .—(1) Where a person is found guilty of an offence under section 49 this fact shall be recorded on a register which the Secretary of State shall establish and maintain in such manner as will afford convenient and rapid access to anyone with a material interest in knowing whether or not a person has been found guilty of an offence under section 49.
  (2) Pursuant to subsection (1) the Secretary of State shall lay before Parliament within three months of Royal Assent to this Act his directions as to how the register shall be established and maintained, and the circumstances in which, and by whom, it may be accessed and at what cost.").
  The noble Baroness said: This amendment seeks to establish a register of offenders convicted for not handing over their encryption key or clear text. It has the support of all the UK's major children's charities: NCH Action for Children; the NSPCC; Barnardo's; Childline; the Children's Society; the National Children's Bureau; and the National Council for Voluntary Child Care Organisations. That is an indication of the seriousness with which those organisations regard this issue, which was also raised in another place.
  The purpose of the amendment is to establish a register of anyone and everyone who is convicted for refusing to hand over their key so that prospective employers, on discovering that a job applicant has such a conviction, can at least ask the person concerned to explain the circumstances which led to the conviction. It does not mean that anyone convicted will necessarily be assumed to be a child pornographer, a paedophile, or anything else for that matter; but an employer would at least be alerted to the fact that the
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  person dabbled with or used encryption software and refused to assist the police when asked, even to the point of receiving a conviction for the refusal.
  This provision is particularly important for the children's charities (and many educational institutions), which routinely refer to List 99 and the Sex Offenders Register for many categories of jobs that they advertise. The amendment would establish one more register that it would be essential for them to refer to. The extra administrative burden for them would be tiny in comparison with the comfort that they would obtain from having done this check.
  If someone was convicted for refusing to hand over the key and escaped going on one of the existing registers, they could then in theory secure a job working with children. Who wants to take the responsibility for the tragic consequences for a child or children if that happened?
  Someone who has evidence of serious offences encrypted and installed on their machines would be sorely tempted not to hand over the key and risk conviction for the lesser offence, carrying a maximum sentence of two years. The Guardian and other newspapers have lamented the existence of that obvious escape route, but I see no immediate or clear way around it.
  I make no apology for reminding the Committee of the case of Mr. Gary Glitter, who, had he encrypted the images on his PC, would probably never have been arrested in the first place. But if he had been, and had refused to hand over his key, he would never have been convicted of the offence of possessing child pornography and would never have suffered the opprobrium that went with it. He would also have escaped being on the sex offenders' register, and at least in theory, although it might be unlikely in his case, would then have been free to apply for work in a residential children's' home.
  There is clearly a real need for the Government to address this issue. I am encouraged by my observation that my noble friend the Minister has heeded the justified concerns of the industry and civil liberties organisations. I hope that he will give similar consideration to the organisations that have expressed their concerns about the matter. I beg to move.
  10.15 p.m.
  Lord Phillips of Sudbury: I regret to say that I must oppose the amendment. I appreciate the way in which it was put forward. I understand the reasons for it and have every sympathy with what the noble Baroness, Lady Thornton, said about the children's charities that she mentioned. I suppose that I should declare an interest and say that I act for some of them.
  The way in which the amendment is drafted does not confine it to children; it gives anyone with a material interest in knowing previous convictions a right to have access to the register. It blows a hole in the fundamental principle of British justice that convictions are not public knowledge, willy-nilly, and that anybody tried for an offence is not to have, as I put it earlier, a label round their neck saying "Previous

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  convictions: 1,2,3,4,5". If the proposal came anywhere near satisfying the basic, traditional protection of people in civil society, it would have to be much more narrowly drafted. Therefore, I must oppose it.
  Lord Bassam of Brighton: I find myself, not in great difficulty, but in sympathy with the spirit of the amendment of my noble friend Lady Thornton and somewhat perplexed that the noble Lord, Lord Phillips of Sudbury, does not think that its subject matter is an issue in the way in which it has been set out. He probably recognises that there is an issue but does not believe that it should be pressed in this way.
  The amendment offers a fairly imaginative way around some of the problems that we have identified in the past. It is welcome that the child-caring charities, those concerned with the issue, have lent a measure of support to my noble friend in bringing the amendment forward. However, I have one or two concerns and questions about it, not least because we have to contemplate the circumstances in which individuals are convicted of offences. At its heart, the amendment suggests that offenders be placed on a register. I have no great difficulty with that principle, but I question the use to which the register might be put. I suppose that it could be asked whether it would be available for those who would employ people who cared for children. If so, there must be a variety of possibilities as to why people might offend under Clause 49. Not all such cases may arise from the possession of paedophile or similar material. That is perhaps one of the deficiencies of the clause as drafted.
  There is a possibility that a register brands others who have offended, perhaps through a misplaced notion of civil liberties, by intentionally withholding information when served with a Clause 46 notice. I do not think that the amendment does the job, and it may be a dangerous path to follow. There is some light on the issue. As I understand it, registers are already in existence which provide a measure of comfort. The DfEE runs a register called List 99. I do not fully understand what it means, but that is its title. That register is compiled under the Education Reform Act 1988, Section 218(6) of which gives the Secretary of State power to give a personal direction that an individual be prohibited from employment which also involves access to children.
  In relation to this debate, a person need not necessarily have a conviction for a sex offence for the Secretary of State to give such a direction. It may appear to be a draconian power, but I believe that it is equal to the problem. However, sufficient grounds must be provided about the position of the individual so that his name can be added to the register. Of course, that relies on good intelligence about the person's involvement in paedophile behaviour which cannot go before a court. The Department of Health also has a list based on similar principles.
  While I fully understand the motives behind the amendment—I appreciate the ingenuity of my noble friend in moving it—in all likelihood the best way forward at this stage is to have continuing dialogue on
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  the subject to see whether we can be helpful. The case of Gary Glitter is a lesson to us all. I do not quite see the problem to which my noble friend refers, but perhaps we need to devote further time to it. I give an undertaking to keep the situation under review. It may serve us all if further discussions take place between noble Lords with an interest in this matter and officials who have responsibility for this area of policy. With that, I hope that my noble friend will feel able to withdraw her amendment.
  Lord Lucas: It may be of interest to look at some of the circumstances that surround this particular cause. Anyone who finds himself on the register as a result of the amendment must first have had a key required of him. The Minister assures us that that will arise only in exceptional circumstances and on only a very few occasions. Presumably, therefore, the individual will be one against whom there is a good deal of prima facie evidence of involvement in activities which the Government seek to prove against him. In those circumstances, surely it is possible to put such an individual on List 99, if nothing else.
  The situation would be improved if the Government changed their opinion on the inclusion of Clauses 16 and 17. In those circumstances, if there is a good deal of prima facie evidence it is more than likely that it will be based on the interception of communications which at present cannot be produced in court. That must be the reason why the Government are so desperate to obtain additional evidence of wrongdoing.
  As I understand it, on the sole occasion when a difficulty arose as a result of a paedophile encrypting data on a hard disk there was sufficient evidence in clear to obtain a conviction, so at least that individual ended up on the register. One hopes that in most cases, given the very narrow circumstances in which people end up with a conviction under this part of the Bill, there will be sufficient evidence available either to convict them or at least to put them on List 99. Perhaps in that way the problem will not arise. However, the inability to catch paedophiles because of their use of encryption is to be laid at the door of Clauses 16 and 17 of the Bill, not this part of it.
  Baroness Thornton: I thank the noble Lord, Lord Lucas, for his support. I know that he and I share an interest in this matter. I also thank my noble friend for his remarks, from which I take some comfort. We are talking about serious crimes about which the children's charities are enormously concerned. As with other serious crimes, new technology is being used. We shall take up the offer to continue the discussions. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 50 [Tipping-off]:
  [Amendment No. 169B not moved.]
  Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 170:
  Page 52, leave out lines 42 and 43 and insert—
  ("during the period within which the notice is in effect, to keep secret from any specified person, or class of persons, the giving of the notice, its contents and the things done in pursuance of it, and to inform any other person who is made aware of any of those things of the requirements of the said provision").
  The noble Lord said: In moving the amendment, I speak also to Amendments Nos. 172 to 174. These amendments relate to the new offence of tipping-off. It is one of the few phrases in the Bill about which one can feel friendly. It is a new offence. It has no parallel in British law. The amendments are put forward in a probing spirit, in the hope that other Members of the Committee will lend their wisdom to this debate.
  There is serious unease about whether the provision will create more problems than it solves. I argue that on the ground of the barbaric complexity of the arrangements governing tipping-off. I believe that it could prove more of a stumbling block and a source of angst to operators in the e-commerce world than any other provision in the Bill. I can imagine the managing director of any one of a thousand companies writing to his or her solicitors asking, "Would you kindly advise us on our risk vis-à-vis Clause 50?" As a practising solicitor, I assure the Committee that he or she would receive a 20 or 30 page letter—solicitors guard their backs carefully these days—raising spectres that the Minister would scarcely contemplate, let alone think were within the ambit of the clause. The provision is extraordinarily wide and loose. Amendment No. 170 seeks to contain the extent and reach of the clause by requiring the notice to specify the person or class of person to whom it relates. I shall be grateful if the Minister will tell me whether the amendment is superfluous. At the end of Clause 50(3) there appear the words,
  "to keep secret from a particular person".
  Should one infer from that subsection that all Clause 46 notices must specify the person or persons in relation to whom the secret must be kept?
  The consequences of passing information to others may be extremely difficult to contain and control. Within an organisation many people may have access to keys or protected information. They may be unaware of the consequences of passing on that information to others. It is vital that the knowledge of a Clause 46 notice can be passed from the person upon whom it is served to others within the same organisation.
  I move the amendment in the hope that others will contribute to this extremely difficult issue. The Police Act 1964, as amended, provides that,
  "any person who obstructs a constable in the execution of his duty shall be guilty of an offence".
  That extends to tipping-off offences. The case of Regina v. Green and Moore, which was heard in the High Court in October 1981, established that quite specifically. The noble Lord, Lord Thomas of Gresford, was acting for the prosecution in that case when they secured a conviction for tipping-off.
  It may help if I refer to a particular case mentioned in that judgment; the case of Regina v. Westlie, a Canadian case. A plain clothes officer was patrolling the streets of one of the less salubrious parts of Vancouver in order to see whether any of the citizens were begging or committing other offences. Mr Westlie frustrated his efforts by walking alongside him and explaining to all who were interested that he was an "under-cover pig" or an "under-cover fuzz". The police brought a prosecution under an equivalent of the old English provision of obstructing a constable in the course of his duty, and obtained a conviction.
  My question is whether we need to go through the agony of this long and tortuous new clause. Why can we not rely on the old obstruction of justice provision, which appears to catch tipping-off cases in any event? I beg to move.
  10.30 p.m.
  Viscount Astor: I have to admit that I find Clause 50 rather mystifying. I, of course, am not a lawyer, unlike the noble Lord, Lord Phillips.
  An important point was raised in relation to subsection (5)(b), where the idea is given that it might specify a person. Subsection (1)(b) requires,
  "every other person who becomes aware of it or of its contents, to keep secret the giving of the notice, its contents and the things done in pursuance of it".
  The subsection seems to be extraordinarily wide in its ambit. Does it, for example, prevent someone who has been given a notice discussing it with his solicitor? I do not know. The noble Lord, Lord Phillips, is a solicitor and he may be able to tell us. Does it mean that anybody who has received a notice cannot write to his MP? From whom must he keep it secret?
  Lord Phillips of Sudbury: As the noble Viscount asks that question direct, I will answer. There is a provision allowing disclosure to a professional legal adviser, but not to one's bookmaker or barber.
  Viscount Astor: What about a Member of Parliament? If someone wanted to complain to his MP or, indeed, write to one of your Lordships, that seems to be disbarred by the Bill. I wonder whether the Minister could confirm how that works. It does appear that the clause goes beyond laws that are in existence and which relate to other others. The Minister will have to justify the powers in the Bill for your Lordships to be reassured by Clause 50.
  Viscount Goschen: I, too, am mystified by the provision. The practicalities of the Bill would seem to be extraordinarily complex and perhaps when a notice is served a copy of Clause 50 could be sent along also and the person told to work out for himself who can or cannot be told. The practicalities are very real.
  It would appear that the possibility of committing an offence by mistake would be serious. May one discuss it with one's secretary or one's board colleagues, or, if one is working for a subsidiary of an American company, is one not allowed to tell the

  1021
  principal? I imagine there could be a duty upon a director to his board and shareholders that could be contravened by not making any statement. It seems almost inconceivable that this could not be dealt with in a much more straightforward and brief manner. The notice served could specify who could and who could not be told, rather than having to work it out from a very long section of the Bill.
  Lord Bassam of Brighton: I had hoped to be brief, but perhaps it is worth spending a little time on the amendment. The major issue is that of secrecy and it might help if I explain the purpose of the offence.
  The offence is not a new invention. Perhaps Members of the Committee opposite will be more familiar with it than I because it is based on precedents in Section 93D of the Criminal Justice Act 1988 and Section 53 of the Drug Trafficking Act 1994. We believe that the provision is needed to preserve the covert nature of an investigation and to deter deliberate and intentional behaviour designed to frustrate statutory procedures and assist others to evade detection. That is reflected in the construction of the clause.
  It is important to remember that the secrecy requirement will not apply in all cases—a fact which must be understood, but has been overlooked by a number of critics. As with other parts of the Bill, some ludicrous scenarios have been painted about the perceived effect of the tipping off offence.
  I shall attempt to clarify the issue. Clause 59(3) limits the occasions when such a provision may be imposed. There is simply no need for secrecy in all cases, which the Bill recognises. By definition, it need not apply when a person is asked for the key to his own data. But were another party has access to a relevant key, we believe it reasonable in certain circumstances to require him to keep quiet about being served with a notice in order to prevent a suspect, for example, discovering that he is the subject of an investigation. That is analogous to interception where, under Clause 18, a service provider is required to keep quiet—
  Viscount Astor: Perhaps I may ask the Minister a question on that point. Does that mean that it must be kept secret from the person involved in that interception or must it be kept secret from everyone? The Minister was not clear about that.
  Lord Bassam of Brighton: I believe the answer is that it must be kept secret from everyone.
  Some of the concerns about the offence appear to come from business which is concerned, perhaps mistakenly, that the decryption notices would perhaps be served on junior employees in an organisation who would not be permitted, because of a secrecy provision, from telling anyone senior. That was behind some of the recent criticism of the Government in seeking to act as some kind of "shadow director".
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  I believe that those concerns should have been allayed by the amendments we proposed to Clause 46 concerning the serving of notices on directors. However, I recognise that there may be some lingering doubts about Clause 50.
  The noble Lord, Lord Phillips, asked a fundamental question about this offence. He asked why it was necessary and why we could not rely on the general interfering-with-the-course-of-justice-type provision which has existed in the past. We decided that, on balance, we would be right to have the offence in the Bill, which is why Clause 53 sets down limits as to when a secrecy requirement might be imposed because of its seriousness. We carefully considered whether an offence such as interfering with the course of justice might be more appropriate. It has also been suggested that we could have relied on contempt of court to achieve what we want by way of deterrent. However, we do not believe that that would cover everything, particularly where the Secretary of State authorised interception warrants.
  We therefore believe that the provision is essential. It is contained in existing statutes and for those strong reasons it is important that we pursue it. However, I understand the strength of feeling raised by Members of the Committee who have opposed it. However, we have gone through the questions raised by the noble Lord, Lord Phillips, and we do not believe that the offence is defined too broadly. The Bill restricts the situations in which a secrecy provision can be imposed. I believe that there may be difficulties with the approach suggested by the noble Lord. Lord Phillips. Therefore, with those comments and with the undertaking that I have given, I ask Members of the Committee who have moved amendments on this issue to withdraw them.
  The Earl of Northesk: I gain the impression from what the Minister said that statutory precedents exist for the tipping-off offence as drafted on the face of the Bill. Perhaps it would assist the Committee if we were told what those precedents are.
  Lord Bassam of Brighton: I did quote them and I am happy to quote them again. If the noble Earl wishes me to do so, I shall be happy to send him a copy of the particular clauses to which I have referred.
  Lord Phillips of Sudbury: Before the Minister sits down, perhaps I may also ask a brief question. In my opening remarks, I asked what was the extent of the provision in Clause 50(3) in so far as it refers to the words,
  "keep secret from a particular person".

  1023
  Perhaps the Minister will write to me to let me know how that requirement works with the remainder of the clause. It may be that our amendment is unnecessary if that is implicit in the requirements of a proper Section 46 notice.
  Lord Bassam of Brighton: I should be happier to correspond with the noble Lord on that matter, then both he and I shall understand it more clearly.
  Lord Phillips of Sudbury: I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord Lucas Lord Lucas moved Amendment No. 171:
  Page 52, line 46, leave out paragraphs (a) and (b) and insert ("the consent of an ordinary Surveillance Commissioner has been obtained").
  The noble Lord said: First, I bring the Committee some good news: we are now half-way through the Marshalled List. I have no intention of calling a Division until about half-past one in the morning, just to make sure that the Chief Whip is doing his job.
  Amendment No. 171 is simple. It seems to me that offences in the area of tipping-off cause industry a good deal of concern. I refer in particular to the scenario mentioned earlier of a relatively junior employee—say, the systems manager of the computer department—being the person on whom the notice is served. Particular concern may arise if a notice is served in conjunction with the opening up of keys to continuing data traffic so that the security of a significant firm is breached. I can imagine a situation where that might occur; for example, if we had another BCCI on our hands. It may be clear that the board of directors is corrupt but they may well be employing honest people lower down.
  However, it seems to me that, in order to give comfort to industry in general, people must be sure that there are adequate safeguards on the occasions when the tipping-off offence is put into place, otherwise there will be a temptation to put it there in every case. That is simply my suggestion as to what one such safeguard might be. I beg to move.
  Lord Bassam of Brighton: I understand the noble Lord's concern. However, this matter comes down to a question of practicalities. As the clause is drafted, we do not believe that Amendment No. 171 would add any extra safeguards. For that reason, we shall resist the amendment. I can understand the reasoning behind it and I have a degree of sympathy for it. However, I believe that, if the noble Lord reflects on the way in which we have recast our clauses under Part III, he will appreciate that this amendment is unnecessary and probably would be disproportionate in all the circumstances. For those reasons, I invite him to withdraw his amendment this evening.
  Lord Lucas: I shall certainly look at the Bill as it appears after Committee stage and I hope that the noble Lord will have convinced me. I beg leave to withdraw the amendment.
  1024
  Amendment, by leave, withdrawn.
  Lord Bach Lord Bach moved Amendment No. 171A:
  Page 53, line 6, leave out ("the key to which it relates is a key to protected information which") and insert ("the protected information to which it relates").
  On Question, amendment agreed to.
  [Amendments Nos. 172 to 174 not moved.]
  10.45 p.m.
  Lord Lucas Lord Lucas moved Amendment No. 175:
  Page 53, line 26, leave out ("software") and insert ("systems").
  The noble Lord said: I merely wonder why the word "software" is used when hardware might be involved instead of or as well as software. I beg to move.
  Lord Bassam of Brighton: I presume that the noble Lord is concerned about futureproofing. We, too, have sought to ensure that the Bill is futureproofed.
  Subsection (5) has been included because the industry requested it to ensure that specific software that has been designed to give an automatic warning that a key has been compromised will not fall foul of the tipping-off offence. There are sensible security reasons for that design option.
  The subsection provides a statutory defence when disclosure occurs as a result of the action of the software and the person concerned was not reasonably able to stop that from happening after being served with a notice. There is clearly a need for the provision.
  We have had no little discussion within the Government about the drafting of the clause. Its present construction reflects counsel's attempt to provide something accurate and workable. Your Lordships will note that the subsection is the same as Clause 13(3) of the draft Electronic Communications Bill, which was published for consultation last summer. We have used the term "software" advisedly. It is our understanding that the defence provided in the subsection is needed to cover a design feature of particular software that triggers the disclosure.
  I hope that that gives some contextual background and that the noble Lord will feel able to withdraw his amendment. I appreciate that it was tabled in an attempt to be helpful.
  Lord Lucas: I entirely understand what the Minister says. However, the pattern is for what is written in software this year to migrate into hardware in a couple of years, so in a couple of years the subsection will not work if the Government leave it as it is. However, if that is how they wish it, I see no reason to argue further. I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord Lucas Lord Lucas moved Amendment No. 176:
  Page 53, line 32, leave out subsection (6).
  The noble Lord said: I tabled this amendment because I do not understand how subsection (6) works. It provides a defence that,
  "the disclosure was made by or to a professional legal adviser in connection with the giving, by the adviser to any client of his, of advice about the effect of the provisions of this Part".
  If I am served with a notice, presumably I toddle off to the company's legal adviser, who is then free to tell anyone else in the company. That seems to get round the intention of this part of the Bill. I beg to move.
  Lord Bassam of Brighton: I am sure that the noble Lord does not really want to delete subsection (6) and that this is a probing amendment. That subsection serves a particular purpose. It seems to us right that a person served with a Section 46 notice that contains a secrecy requirement because of particular circumstances should nevertheless be permitted to approach a legal professional for advice about the effect of the notice without being penalised under the tipping-off offence. It would be unfair if they were not able to do that.
  I trust that that clarification helps the noble Lord and that he will now feel able to withdraw his amendment.
  Lord Phillips of Sudbury: I point out to the noble Lord, Lord Lucas that, under subsection (8), the protection given to a legal adviser under subsection (6) does not apply if the legal adviser lets the information out in the course of furthering a criminal purpose. Doing so to enable somebody to escape the net would be a criminal act.
  Lord Lucas: I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord Lucas Lord Lucas moved Amendment No. 176ZA:
  Page 53, line 46, at end insert—
  ("( ) Nothing in this section shall prevent any person described in subsection (1)(a) or (b) taking such action as may be necessary to preserve the confidentiality of any communication (other than that concerning the protected information described in section 46(1)) unless such action is expressly forbidden in the section 46 notice.").
  The noble Lord said: We touched briefly on this issue earlier but I seek further clarification. It seems to me that where confidentiality has been breached, under most circumstances a company should have the right to repair that breach. The Minister said he would touch on that matter again when we discussed tipping-off and I now give him that opportunity. I beg to move.
  Lord Bassam of Brighton: The noble Lord has caught me out. It will take me some time to find the information that he requires. I shall have to write to the noble Lord. I apologise to the Committee.
  Lord Lucas: I beg leave to withdraw the amendment.
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  Amendment, by leave, withdrawn.
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 176A:
  Page 54, line 19, leave out from first ("the") to ("or") in line 20 and insert ("Intelligence Services Commissioner").
  The noble Lord said: This is a long group of government amendments, the effect of which abolishes the posts of Intelligence Services Commissioner and Security Service Commissioner and replaces them with a single intelligence services commissioner. These amendments respond to the concern expressed in another place about the number of commissioners.
  The post of Security Service Commissioner was introduced in the 1989 Security Service Act. The post of Intelligence Services Commissioner was introduced in the Intelligence Services Act 1994. The Security Service Commissioner has responsibility for the oversight of functions in connection with the Security Service and the Intelligence Services Commissioner carries out similar functions in relation to GCHQ and the Secret Intelligence Service. In practice, both roles have since been held by the same person, as most Members of the Committee will know. These amendments formalise that arrangement by having a single commissioner carrying out both functions, together with the additional functions required of him under the Bill.
  The new commissioner will be responsible for reviewing: the Secretary of State's exercise of powers under Sections 5 to 7 of the Intelligence Services Act—warrants for interference with property or wireless telegraphy; the Secretary of State's exercise of powers in relation to the intelligence services and in relation to MoD/Armed Forces other than in Northern Ireland under Parts II and III of the RIP Bill; and the exercise and performance of functions by all three intelligence services and by MoD/Armed Forces, other than in Northern Ireland, under Parts II and III of the Bill.
  Government Amendment No. 231 amends the title of the Bill to include the establishment of the new commissioner posts. I am sure that slim-lining the number of commissioners in this way will be welcomed by the Committee. I beg to move.
  On Question, amendment agreed to.
  Lord Bach Lord Bach moved Amendment No. 177:
  Page 54, line 20, at end insert ("or Assistant Surveillance Commissioner").
  The noble Lord said: In moving this amendment, I shall speak also to the other amendments in the group. We are aware that concern has been raised about the proliferation of different commissioners with oversight of the various intrusive investigative techniques and we have responded by removing from the Bill the covert investigations commissioner and amalgamating that oversight function with that of the chief surveillance commissioner.
  However, by doing so we have set the chief surveillance commissioner a wide-ranging and onerous task. He already has responsibility for oversight of all authorisations given under Part III of

  1027
  the Police Act 1997. This Bill gives him added responsibility for oversight of authorisations for covert surveillance and the use of covert sources, not only by law enforcement departments but by a large number of government departments, with offices spread across the length and breadth of the country.
  In his current responsibilities relating to authorisations for interference with property, he is supported by five surveillance commissioners, who are serving or retired High Court judges. As a measure of the seriousness with which this function is taken, every authorisation given under Part III of the Police Act is scrutinised by a surveillance commissioner and, indeed, the prior approval of a surveillance commissioner is required for certain categories of authorisation. In practice, the Bill will add to these responsibilities the scrutiny and decision whether or not to give prior approval for every authorisation given for intrusive surveillance by the law enforcement agencies. That, together with their current work, will keep them fully employed.
  Therefore, we must provide the chief surveillance commissioner with further assistance in order to ensure that he is able effectively to scrutinise other forms of covert surveillance and the use of covert sources by law enforcement and other public authorities. For the police alone, we expect that to involve in excess of 150,000 authorisations each year. He cannot do that alone and we anticipate that he will want to set up some form of inspectorate to assist him.
  However, we also believe that it is important that the chief surveillance commissioner should be provided with some judicial support for this function. That could be done by increasing the present numbers of surveillance commissioners but there are simply not enough serving or retired high court judges out there. Instead, therefore, we propose to increase the pool of potential commissioners. These amendments will achieve that by allowing the Prime Minister, after consultation with the chief surveillance commissioner, to appoint serving or former circuit or Crown Court judges to assist in the monitoring process. By that means, we shall ensure independent judicial scrutiny of authorisations by all public authorities. I beg to move.
  On Question, amendment agreed to.
  Clause 50, as amended, agreed to.
  Clause 51 [General duties of specified authorities]:
  [Amendments Nos. 178 and 179 not moved.]
  Clause 51 agreed to.
  Lord Lucas Lord Lucas moved Amendment No. 179A:
  After Clause 51, insert the following new clause—

  LIABILITY FOR UNAUTHORISED DISCLOSURE OF KEY
  (" . Any person disclosing a key in an unauthorised manner shall he liable for any damage so caused.").
  The noble Lord said: Amendment No. 179A gives me the opportunity to ask the Government who is liable if one of its officers, servants or agents discloses a key and thereby causes substantial damage to a major corporation. I beg to move.
  Lord Bassam of Brighton: We recognise that this is an issue of fundamental concern to industry. The general welcome for the intentions of the Bill by industry has been qualified by that concern. Some areas of concern remain and they are reflected in the intention of the Government in amendments tabled for today or in amendments that we intend to table on Report. I note that the potential liability incurred through the disclosure of seized keys is one of the points on which industry seeks particular reassurance.
  In the light of that we have actively looked into the possibility of including something on the face of the Bill to make it clear where liability lies. However, it should be borne in mind that where keys are demanded, they are most likely to be held by the technical assistance centre. A considerable amount of resource has been devoted to the establishment of that centre and a primary objective of the centre will be to look after keys securely. I am in no doubt that where the centre negligently fails in that regard, and where there is a duty of care, it will be liable for the disclosure of any keys. But I should add that I do not expect the centre to fail in that regard.
  I should draw the Committee's attention to Clause 14 of the Bill and the safeguards that are to be applied to intercept material. The safeguards in Clauses 14 and 15 are built, to a large extent, on those that exist in Section 6 of the Interception of Communications Act 1985. Such high standards for protection and destruction of material have existed since then and I do not believe that any of our researches have shown any leakage would expect that impressive track record to continue in respect of any keys that are seized.
  All that said, we have looked at the possibility of reflecting the secure position of persons acting in obedience to disclosure notices served under the Bill. The industry concern is the potential civil or criminal liability that they will face by making disclosures pursuant to a Section 46 notice. The Government reassurance, for the record, is that we believe a contractual term will be unenforceable if it puts someone in breach of meeting a statutory requirement. We expect the criminal law to be construed similarly.
  The London Investment Banking Association helpfully pointed us to the Drug Trafficking Act 1994. Section 52 of that Act is the offence of failure to disclose knowledge or suspicion of money laundering. Section 52(4)states:
  "Where a person discloses to a constable … his suspicion or belief that another person is engaged in drug money laundering, or any information or other matter on which that suspicion or belief is based, the disclosure shall not be treated as a breach of any restriction imposed by statute or otherwise".
  Similar wording appears in regulation 16(4) of the Money Laundering Regulations 1993.

  1029
  We have looked at those pieces of legislation to see if they provide a precedent. But they do not. The cases are different. The person acting on a subjective suspicion in those two examples is not obeying a statutory requirement which unequivocally applies to his situation, whereas the person obeying a Section 46 notice is indeed obeying a statutory requirement which does unequivocally apply to his situation.
  In short, there is no doubt as to the lawfulness of what the person who obeys a notice is doing. But the provisions of the Drug Trafficking Act are needed because that doubt exists. If we were to repeat such a formulation on the face of the Bill, there would be a real danger that the need to spell out the position on liability in this Bill would be inferred to apply across the statute book. Generally, that compliance with a statutory duty to disclose information does not, without express words that might be put into this Bill, provide a defence to criminal and civil liability. That could have serious implications elsewhere. We know of no precedent for such a provision and should not create one.
  I appreciate that this is good and bad news. The good news is that we are clear as to the position of people served with disclosure notices. We are also confident that keys which are treated negligently will give rise to liability where a duty of care is found to exist. The bad news is that not only do we not see the need to place this on the face of the Bill, but we also see positive dangers in so doing in so far as it could impact on other parts of the statute book. The good news is the important news here, and I hope that Members of the Committee, and particularly concerned elements of industry outside, will hear what I have said. I trust therefore that the noble Lord will feel able to withdraw his amendment accordingly.
  11 p.m.
  Lord Cope of Berkeley: This is an important amendment. Clearly we shall have to study carefully what the Minister said because there were important elements in his response, among them that if the centre did disclose a key, then it would be liable if it disclosed it negligently. That is quite a high test in the courts, a much stronger test than that proposed in Amendment No. 179A.
  The Minister also sought to reassure us about contractual liabilities in relation to companies which might find themselves in this position. He may be right—I have no reason to doubt that—in relation to United Kingdom law, but many of the liabilities about which bankers and others are worried arise from the law of other countries. That is where the liabilities will be and, in some cases, they could be extremely large. That is why there is nervousness about this provision. That is why we shall study carefully what the Minister said.
  Lord Lucas: As the Minister is doubtless aware, one prominent American but London-based merchant bank has already taken steps to transfer its entire
  1030
  central data operation from London to Switzerland. It has put in place steps so that no authorisations or key disclosures can be actioned from any address in the United Kingdom. Therefore no employee served with that sort of notice in the UK can get at any of its keys because they are all in Switzerland and he cannot have them.
  Given the quality of the people who have taken this action, I would expect this to be followed fairly quickly by other businesses taking preventive measures. The sort of action that follows from this is that, once you begin to establish your real core, central operations somewhere outside the United Kingdom to avoid this sort of legislation, other parts of your operations will follow. I do not believe that this is a healthy state of affairs for us; indeed, it is something that this Government ought to be taking seriously. They should be taking positive, not just tentative, steps to try to allay the quite reasonable concerns of industry when it comes to this sort of international obligation, as pointed out by my noble friend Lord Berkeley.
  I hope that we will hear more from the Government on this area during the Report stage. But, if we do not, I shall certainly wish to return to the matter. However, for now, I shortly hope to be able to sleep on the Government's reply. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 52 [Interpretation of Part III]:
  Lord McNally Lord McNally moved Amendment No. 180:
  Page 55, line 31, at end insert (". and does not affect the intelligibility or accessibility of that communication or data).
  The noble Lord said: About seven-and-a-half hours ago, the noble Lord, Lord Williams of Elvel, chastised my noble friend Lord Phillips for questioning the wisdom of the Marshalled List. I take courage in both hands now partly because—for reasons I do not quite understand—the noble Lord is no longer in his place. However, I am sure that he will read the Hansard report of these proceedings and "buttonhole" me tomorrow.
  However, the latter is the preamble to saying that I should prefer to talk to Amendments Nos. 180, 181, 183 and 186 as a group. They all relate to this definition clause and have the same objective; namely, to try to tighten up the electronic signature and key definitions to close various loopholes. The present wording brings all sorts of applications of signature-only keys into the ambit of Clause 46 notices, which is contrary to the content of the Bill. The proposed wording would make it abundantly clear exactly when a key is being used for the purposes of signature.
  Amendment No. 181 provides the third reason—"the authority"—for using an electronic signature, which is defined under Amendment No. 186. Amendment No. 183 seeks to ensure that the word "key", as applied to encryption, always implies some intent to conceal, which surely is the essence of encryption. I beg to move.
  Lord Bassam of Brighton: I am happy to consider the re-grouping of these amendments, as proposed by the

  1031
  noble Lord. These amendments hark back to concerns which underpinned noble Lords' proposed changes to Clause 46(6) by restricting access to keys that have been used solely for electronic signature purposes.
  In simple terms, I suppose that an electronic signature can be described as something associated with an electronic document that is the electronic equivalent of a manual signature. Providing a definition for this in statute is somewhat trickier. I understand what the noble Lord is seeking to achieve by way of these amendments, but we believe that the definition in Clause 52(1) is clear enough. Perhaps I may just draw the important words to the attention of the Committee. Clause 52(1)(c) states that an electronic signature is anything in electronic form which,
  "is used for the purpose of facilitating, by means of a link between the signatory or other source and the communication or data, the establishment of the authenticity of the communication or data, the establishment of its integrity, or both".
  In respect of Amendment No. 180, I believe that I would probably go further and suggest that if signatures are encrypted they will always affect the intelligibility or accessibility of the data in question. Therefore, the effect of the amendment seems questionable—if, indeed, there is an effect. I am not certain that there is.
  Amendment No. 181 seems to have an intended effect similar to Amendment No. 185 which we shall discuss later. Both address the question of whether a legal effect is intended. Similar reference to what is included in this Bill was included in the Electronic Communications Act for fear that, without it, some activity might be caught in which there had been no intent to create legal relations. The provisions as drafted here, and in the other Act, are intended to ensure that signatures are a means of creating legal relations only where that is intended and not, perhaps, by chance through the accidental operation of software. Authenticity and integrity are the crux of the matter. Clause 52(1), as drafted, says that. I hope that that deals with the point.
  I turn to Amendment No. 183. We have currently cast t he definition of "key" for the purposes of this part of the Bill in what we hope are clear and workable terms. A key which may be required to be disclosed is one—this is the crucial point—which allows access to the electronic data in question, or facilitates putting the electronic data into intelligible form.
  This is the whole purpose of the Part III power. We believe that the current definition is clear. We are not convinced that the suggested amendment adds anything to it. We have already discussed the issue of electronic signature keys. We do not believe that the inclusion of limb (b) in Amendment No. 183 is appropriate here. It seems to try to include in the definition of a key something that is more appropriate for the definition of a signature. In as far as the only need to mention signatures in this Bill is to exclude them from what can be accessed as keys, it would be distinctly unhelpful specifically to include these signatures in the definition of keys in the first place only to exclude them later.
  1032
  We have difficulties with the first limb of the amendment. What is described in the first limb seems to be an encryption key. What is relevant to this legislation is a decryption key. This is a significant difference which I am sure noble Lords will appreciate. I take it that Amendment No. 186 must be consequential to Amendment No. 181 and provides a definition of "authority" as regards an electronic signature. I have already explained why we do not believe that the proposed addition of a reference to "authority" is appropriate. It follows that this proposed definition is unnecessary. While the amendments have sought to be constructive we do not believe that they add anything to the legislation.
  Lord McNally: I thank the Minister for co-operating in my re-ordering of the Marshalled List. I promise not to tell the noble Lord, Lord Williams of Elvel, that he has done that. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 181 not moved.]
  Lord Lucas Lord Lucas moved Amendment No. 182:
  Page 55, line 38, leave out from ("means") to end of line 40 and insert ("anything (including any key, code, password, algorithm or other data) the use of which, with or without any other thing").
  The noble Lord said: Amendment No. 182 merely seeks to broaden the definition of "key" and supposes that the "key" is a key as we ordinarily understand that, or at least such a key is part of the "key". We seem to have a definition in the Bill whereby if you have some kind of physical lock on information, as well as a password lock, you are home free. That seems to me unsatisfactory. I beg to move.
  Lord Bassam of Brighton: I believe that I have already used the word "perceptive" in regard to amendments moved by the noble Lord. This is a perceptive amendment. However, it has the consequence—I do not know whether this is intended—of widening the definition of "key". I should be interested to know whether that is the noble Lord's intention. The query really is whether the definition we have for "key" in Clause 52(1) is future-proof.
  As with the rest of the Bill, we have sought to ensure that the definitions included in it are future-proofed as far as possible without making them too loose or unworkable. The definition of "key" here is probably a case in point.
  I am attracted to the suggestion of the noble Lord, Lord Lucas. We have given it a good deal of consideration. However, the use of the word "thing" may be casting the definition of a key too widely. I quite like things being called things.
  In drawing up these proposals we considered the issue of what might happen in the future in terms of devices used to access data—something like biometrics or electronic fingerprinting are perhaps good examples. Even these devices will ultimately be reduced to data before they can have their intended effect. The Part III power is about being required to

  1033
  hand over something—for example, a key or a password—which allows access to particular data or puts it into what we would accept is an intelligible means or form. We have included a reference to data in the definition of key in Clause 52(1). That is as far as we feel we can legitimately go. I appreciate the helpful way in which the noble Lord moved the amendment. However, I hope that with my explanation he will feel able to withdraw it.
  Lord Lucas: I should be grateful, not now but in correspondence, if the Minister could point me to a definition of data in the context of legislation which is as wide as he seems to presume it is. Suppose one thinks of a system which is a fingerprint recognition system which does not reduce the "thing" to a digital pattern but which relies on some kind of analogue matching system, so that actually the "thing" is never reduced to data. It merely produces the answer, yes. It is very hard to describe "fingerprint" as "data" if it is never reduced to data. I suppose one might embrace it in the term "information" if one was prepared to use the philosophic version of that. I am not aware that that has been incorporated or understood in legislation. I should like to understand the basis for what the Minister is saying. The noble Lord is quite right. I am seeking to widen this to the point where we do not just think in terms of how it happens to be done at the moment—at the beginnings of cryptography—but use something other than an essentially digital password as protection. I should like the reassurance that the word "data" covers that.
  11.15 p.m.
  Lord Bassam of Brighton: I am always happy to correspond, as the noble Lord, Lord Lucas, knows. The fingerprint is an interesting example. When does the fingerprint become data? Does it become data when it is stored? I shall be happy to pursue the point further. No doubt we can pick that up with some of the other issues we shall be putting down on paper.
  Lord Lucas: I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 183 not moved.]
  Lord Bach Lord Bach moved Amendments Nos. 183A to 183C:
  Page 56, line 12, leave out subsection (2).
  Page 56, line 16, leave out ("protected information") and insert ("information (including a key to protected information)").
  Page 56, line 19, after ("concerned;") insert—
  ("( ) to his having an immediate right of access to it, or an immediate right to have it transmitted or otherwise supplied to him.").
  The noble Lord said: These amendments were spoken to with Amendment No. 139A. I beg to move.
  On Question, amendments agreed to.
  [Amendment No. 184 not moved.]
  Lord Lucas Lord Lucas moved Amendment No. 185:
  Page 56, line 34, leave out sub-paragraph (iii).
  The noble Lord said: Amendment No. 185 seeks to leave out sub-paragraph (iii) of Clause 52(5). I cannot see what,
  "whether it is intended to have a legal effect",
  has to do with authenticity. Authenticity is quite well-defined by sub-paragraphs (i) and (ii). If those conditions are satisfied, I am happy that the communication is authentic. Why should legal effect have anything to do with it at all? I beg to move.
  Lord Bassam of Brighton: I believe that the noble Lord, Lord Lucas, thinks that this is irrelevant to the question of authenticity. The definition contained in Clause 52(5), to which this amendment refers, is exactly the same as that set down in Section 15(2) of the Electronic Communications Act 2000.
  I believe that we should engineer as much consistency as possible between these two statutes. I have explained why this definition appears in the Electronic Communications Act. In that legislation we were concerned to ensure that electronic signatures had "legal effect" only where that was intended. Having felt the need to make such a clarification in that Act, we decided that it would be confusing not to replicate it in the legislation before us. I hope that it is clear to the noble Lord that we are seeking consistency here.
  Lord Lucas: I understand entirely what the Minister has said. I shall have to do a little more homework to check that the two measures are truly consistent. I have happy memories of taking a Bill on construction through this House where, for the sake of consistency, a definition of construction was taken from the Taxes Act. Sometimes these matters can be taken a little too far. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 186 not moved.]
  Clause 52, as amended, agreed to.
  Clause 53 [Interception of Communications Commissioner]:
  Lord Lucas Lord Lucas moved Amendment No. 187:
  Page 57, line 3, leave out paragraph (a).
  The noble Lord said: Matters are now moving a little too quickly for me. I find myself hoisted by my own petard here while I try to catch up with the intention behind this amendment.
  The Minister will recall a letter that I received from him, to which I have referred on previous occasions, which examined the extent to which the activities of the Secretary of State were subject to review. It was pointed out that Clauses 12 to 19 were free of such review. We dwelt on that point while moving through our detailed examination of those clauses. The noble Lord said that he would consider again whether in fact that was right; namely, that some of those activities should be free of supervision.
  Amendment No. 187 merely provides an opportunity to call attention to that absence. Amendment No. 188, tabled in the name of my noble

  1035
  friend, does this rather better and replaces the clauses. Amendment No. 189 is a similar attempt to look at the spread of powers of the commissioner. I beg to move.
  The Deputy Chairman of Committees (Lord Dean of Harptree): If this amendment is agreed to, I shall not be able to call Amendment No. 188.
  Lord Cope of Berkeley: Amendment No. 188 tabled in my name seeks to extend the duties of the interception of communications commissioner to cover Clauses 14 and 15 of the Bill as well as those with which he is already charged. The clauses detail the safeguards governing the restrictions on the use of intercepted material. It seemed to me that it would be helpful if the commissioner had an oversight of those matters so as to reassure those who are, as it were, at the receiving end of these provisions.
  Lord Bach: Amendments Nos. 187, 188 and 189 seek to add to the role of the interception of communications commissioner. During our discussion last week on Clause 15, I undertook to consider the position of the interception of communications commissioner in relation to that clause. We have done that and I can say to the noble Lord, Lord Cope of Berkeley, that Amendment No. 188 is not necessary.
  Perhaps I may deal first with Amendment No. 188. Its ambition is simply to add Clauses 14 and 15 to the elements of Part I of the Bill which are to be overseen by the interception of communications commissioner. Noble Lords will see from subsection (2)(d)(i) of Clause 53 on page 57 that the duties of the Secretary of State under Clause 14 already fall to be overseen by the interception of communications commissioner. It is also the case that Clause 15 merely elaborates on the duties that are to be undertaken in order to ensure that the duty under Clause 14 is properly discharged. The effect is that the interception of communications commissioner already has, under the Bill as drafted, a role in the oversight of the very important regime under Clauses 14 and 15 of the Bill. I hope that the noble Lord finds that reassuring.
  The ambition of Amendments Nos. 187 and 189 in the name of the noble Lord, Lord Lucas, is rather greater. These amendments seek to ensure that the entirety of Part I of the Bill is reviewed by the commissioner. I have answered the question in relation to Clauses 14 and 15—they are already under his auspices. I now move to those elements of the Bill which are not under the auspices of the commissioner and explain why that is not necessary.
  There are not many clauses which are not under the interception of communications commissioner. The clauses in question are Clauses 12, 13, 16, 17, 18 and 19. No one will forget our previous detailed discussions of Clauses 12 and 13. Noble Lords opposite have impressed on us very firmly the need to offer further reassurance as to their operation. As we have indicated, the Government are seriously considering the regime under Clauses 12 and 13 and what extra reassurance can be offered. But we do not believe that there is a proper role for the interception
  1036
  commissioner in providing this reassurance. These assurances are about detailed technical issues and the costs involved.
  Noble Lords opposite have suggested that a technical advisory board is the appropriate answer, at least in part. We accept that and continue to consider whether this board needs a statutory base. The vital and independent insight that is needed on the operation of Clauses 12 and 13 should come from industry and industry organisations. We do not see that the interception of communications commissioner can fulfil that role. In short, we Continue to search for ways of providing reassurance on the operation of Clauses 12 and 13 but we do not think that this is a role for the commissioner.
  Turning to Clauses 16 and 17, during our debates last week, the noble and learned Lord, Lord Lloyd, prompted a fascinating discussion of those clauses which addressed important legal points. But the import of the clauses is that they set out rules that are to be followed by the prosecutor in each case, and sometimes by judges. As such, we believe that there is no requirement for further judicial oversight on the operation of those clauses.
  That leaves Clauses 18 and 19. Clause 18 carries an offence of tipping off which will only ever be effected through the courts, so there is no need for oversight by the interception of communications commissioner. To put it another way, it makes no sense for offences to be overseen. That is what is required only in respect of functions conferred by the Bill. Clause 19 is merely about the interpretation of Chapter I, which similarly does not require oversight by the commissioner.
  I have spelled out why the only elements which fall outside the oversight of the interception of communications commissioner should remain outside. Clauses 14 and 15 actually fall within it. I hope that my remarks are enough to satisfy Members of the Committee and that they will feel able to withdraw their amendments or not move them when they are reached.
  Lord Cope of Berkeley: With respect to Amendment No. 188, I fully accept that Clause 14 is covered by the provisions in subsection (2)(d). But the wording is significantly different from that in subsection (2)(a). Subsection (2)(a) refers to a review being of the "exercise and performance" of the various matters, which is also the wording in paragraphs (b) and (c); whereas subsection (2)(d) merely states that the commissioner shall review "the adequacy of the arrangements" by which duties are sought to be discharged. It is a considerably lesser hurdle. As the arrangements we are talking about are the ones for certificated warrants, it is important that they should be properly supervised. Therefore, I hope that the Minister will reflect on his answer on that matter between now and Report.
  Lord Lucas: I am so pleased by the news that Clause 12 is under active review that I am prepared to withdraw almost anything, and certainly this amendment. I beg leave to withdraw the amendment.

  1037
  Amendment, by leave, withdrawn.
  [Amendments No. 188 and 189 not moved.]
  11.30 p.m.
  Lord Phillips of Sudbury Lord Phillips of Sudbury moved amendment No. 189A:
  Page 57, leave out lines 36 and 37 and insert (", provide the Commissioner with such technical and other staff, equipment and other resources as may be requisite to enable him to carry out his functions").
  The noble Lord said: The amendment is designed to try to ensure that the power and resources of the interception of communications commissioner are sufficient for him or her to do what is, on any reckoning, a massive job. The background is that the Bill represents a complex and vast legal superstructure necessary in order to control a burgeoning new industry, increasing in scale and scope day by day. Therefore, I do not think it is helpful to consider the power and resources of the commissioner against those currently at the behest of the existing interception commissioner.
  We on these Benches feel that the duties of the commissioner under the clause are enormous. Basically, apart from the few clauses to which the noble Lord, Lord Bach, referred, he or she is the watchdog of the whole Bill. Unless there are fully adequate resources in all respects—people, machinery, equipment and so on—there is no chance that what we all so devoutly wish for will come about, namely, that the great powers and discretions under the Bill will be matched by commensurate safeguards. The motif of all these debates is concern about civil liberty issues above all others.
  The commissioner's duties under subsection (2) go to the whole of the operation of the Bill, except for the few matters mentioned. It will be necessary for the commissioner to have oversight of the 10 categories of authority set out in Clause 6; of the eight categories of authority set out later in the Bill; and of the police forces, not just at chief constable level but at lower levels as will be authorised as the Bill comes into effect, where one is issuing direct surveillance authorisations and covert human intelligence authorisations. There are emergency warrants to consider, intrusive surveillance procedures to oversee. Every discussion on every amendment has pointed to the difficulty and complexity that that will involve.
  I suppose that what the amendment is based upon is a doubt that in the event there will be sufficient resources available to the commissioner. Our governance is littered with individuals who have huge jobs to do with inadequate resources. I mentioned earlier the failure to deal at all with insider trading in the City, which is partly a function of lack of sufficient expertise and resources.
  I am grateful to the noble Lord, Lord Bassam of Brighton, for responding as he did two days ago to a letter I wrote him on 13 June raising these concerns. He referred to the hope of a unified and investigative secretariat whose resources would be available to the
  1038
  interception commissioner. He also referred to the remarks of the noble and learned Lord, Lord Nolan, in the 1997 report of the commissioner. (I am glad to see the noble and learned Lord in his place.) However, those remarks were concerned with the extent to which it was believed that the Secretary of State dealt with warrants properly. This amendment is not concerned with the Secretary of State; it is way downstream of the Minister.
  The noble Lord, Lord Bassam of Brighton, also said in his letter that,
  "Clause 54(l) imposes a duty on everyone involved in interception to disclose or provide to the Commissioner all such documents and information as he may require to carry out his functions. This means, for example, that expert technical staff in the agencies would be obliged, at the request of the Commissioner or his staff, to explain how any particular system worked".
  I do not believe that that is remotely good enough. The commissioner will require his own bespoke staff and not be reliant upon calling in experts or staff from other agencies who may already be heavily involved in important work.
  The Minister also said it was expected that the commissioner would have a staff of four:
  "one grade 7, one higher executive officer, one administrative officer and a personal secretary".
  I do not believe that they will be remotely adequate to do the job thoroughly in a way that puts the fear of god into those with these great powers that, if they do not exercise them properly and with due diligence, they are likely to be caught out. Unless that happens the people of this country will not be satisfied with the powers provided under the Bill. I am sorry to detain the Committee at this time of night, but I believe that this is a very important point. I beg to move.
  Lord Nolan: For one of Her Majesty's judges, I have been silent for what must be a record time. I rise to agree with the noble Lord, Lord Phillips of Sudbury. As I am sure the Minister accepts, this is a very important point. During the six years that I held the post of commissioner up until April of this year, year after year I was able to assure the public in my reports not only about the remarkable efficiency of the system but of its integrity. I was able to say, as I firmly believed, that the possibility of the system being abused by government or government agencies was remote, almost inconceivable. That was due to the very high quality of the individuals in the agencies, the government departments concerned—the Home Office, Foreign and Commonwealth Office, the Northern Ireland Office and Scottish Office (now the Scottish Executive—the Secretaries of State of this and the previous administration, who have been most conscientious, and the individual employees of the telephone companies and the GPO. They are very carefully picked and have proved themselves totally trustworthy in operating the system.
  The integrity of the system is paramount and, as the noble Lord, Lord Phillips of Sudbury, said, will become of even greater importance under the enormously increased scope of the commissioner's job as provided for under the Bill. The burden on the

  1039
  commissioner has already greatly increased under the present system, as is well known to the Home Office and to Ministers.
  When I sat as a judge full-time in this House I spent about six weeks a year simply on the work of the commissioner. I did not find it a terrible imposition, but it was a burden on my fellow Law Lords who had to work that much harder. I believe that that point must be addressed in future. In the past 18 months or so the work has taken me, on an annual basis, at least eight weeks. Clearly, given the increased responsibilities the staff available to the commissioner must be substantially increased. I know that a good deal of thought has been given to the matter, and I look forward to hearing in more detail precisely what stage the preparations have reached. Knowing how well the problem is understood, I hope also that the points raised have been anticipated. I shall take a close interest in the matter and will be prepared to raise it in this Chamber should the need arise. The crucial factor is that the public should be able to feel that the commissioner has the knowledge and resources to carry out his functions.
  We may be reaching the position where it is beyond the scope of one man or woman even if he or she is a retired judge. It may become necessary to consider, as it has with the chief surveillance commissioner, the appointment of a deputy to work in harness with the interception of communications commissioner. I am prepared to wait with interest to see what is proposed. I trust that it will be—in line with what has already been said to me privately— adequate for the purpose. I look forward to hearing the Minister.
  Lord Bach: The noble Lord, Lord Phillips of Sudbury, is very fortunate indeed in the support he has for the principle underlying the amendment. As we have all noted, the noble and learned Lord, Lord Nolan, has sat with incredible patience for hour after hour through the late afternoon, the early evening and into the small watches of the night before speaking. The fact that he has spoken on this issue shows how deeply he feels about it. The Government are very sympathetic, of course.
  In responding to an earlier amendment, we indicated that we have great sympathy with the suggestion that there should be a facility in the order made under Clause 12 to require that any capability developed should provide the commissioner with the wherewithal to fulfil his duties in the face of rapid technological development. We shall return to that question on Report.
  The noble Lord, Lord Phillips, referred to Clause 53(7). That is a helpful subsection. There is further reassurance in Clause 54(1), which imposes a duty on everyone involved in interception,
  "to disclose or provide to the … Commissioner all such documents and information as he may require … to carry out his functions".
  That means, for example, that expert technical staff in the agencies would be obliged at the request of the commissioner or his staff to explain how any particular system worked and to show them the information stored on it.
  1040
  The practice of successive commissioners—as the Committee knows, the current commissioner is the very distinguished judge Lord Justice Swinton Thomas—has been to make regular visits to the intercepting agencies and to inspect the warrant-issuing units of the four central government departments. Indeed, the noble and learned Lord, Lord Nolan, noted in his report for the year 1995 that he had extended his study so as to include the safeguards operated by the public telecommunications operators.
  It has always been government practice (whichever government are in power), as was said by the noble and learned Lord, to provide the commissioner and his staff with the necessary office accommodation and equipment to do their job properly and effectively. I assure the Committee that that practice will continue under the new regime.
  I can confirm the contents of the letter that the noble Lord, Lord Phillips of Sudbury, received recently from my noble friend about the kind of thinking at the Home Office on how best to ensure that the interception commissioner has the support and staff necessary to carry out his new functions. The Government are thinking carefully about the best way to pursue that. I do not think that there should be any question about our motives. We agree entirely with both speakers about how important that is. It would be useful if the noble Lord withdrew his amendment today. It is not an issue that is dead.
  Lord Phillips of Sudbury: I am grateful to the noble Lord. I shall withdraw the amendment. I am grateful for what the noble and learned Lord, Lord Nolan, said.
  The Minister referred to Clause 53(7). At present, subsection (7) provides for such resources as the Secretary of State considers necessary, as opposed to the objective test of the amendment—that the commissioner would be provided with such resources as may be requisite. I hope that when the Government return to the issue they will agree with that.
  Lord Bach: Someone has to make the decision. I should have thought the Secretary of State was as good a person to make that objective decision as anybody. I am not sure there is much difference in the distinction between the subsection referred to and the wording of the amendment.
  Lord Phillips of Sudbury: I beg to differ and it may be that I shall have a discussion with the noble and learned Lord, Lord Nolan, afterwards and we will come banging on the noble Lord's door. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 53 agreed to.
  Clause 54 [Co-operation with and reports by new Commissioner]:
  [Amendments Nos. 189B to 189G not moved.]
  Lord Lucas Lord Lucas moved Amendment No. 190:
  Page 58, line 42, at end insert ("seriously").
  The noble Lord said: My interest here is merely to raise the test which the Prime Minister has to set himself in deciding whether to cut parts out of the commissioner's report.
  The action will not be subject to any oversight or supervision whatever. In fact no one will know it has happened, except the commissioner who will presumably keep "mum" about it. It is a decision for the Prime Minister to make himself, and I believe it would be helpful in that context if there were some wording to indicate that it is not a test of whether it might cause some slight damage here or there. Either it is phrased in the way I have suggested, that it is serious, or we include a phrase such as "balance" to indicate that taking parts out of the report is only to be embarked upon when the consequences would be notably bad for any of the causes mentioned in that part of the Bill and that it should not be done lightly or at a whim. I am sure it would not be, but I believe that the wording of the Bill should reflect what we hope should happen. I beg to move.
  Lord Nolan: In my experience there has never been any difference between the commissioner and the Prime Minister, or a previous Prime Minister, as to what should or should not stay in.
  The matters which have been omitted are matters which really could not be disclosed without great prejudice to national security or for the other purposes of the Bill. That may not be an answer to the point raised by the noble Lord, Lord Lucas, but, for what it is worth, my experience would not lead me to regard it as essential.
  Lord Bach: I may be fortunate enough to have an ally in the noble and learned Lord, Lord Nolan, in what I am about to say. Amendment No. 190 proposed by the noble Lord, Lord Lucas, would require that material only be excluded from any annual report where it was seriously prejudicial to national security or one of the other grounds as set out in paragraphs (a) to (d).
  The Government believe it is difficult to place a specific meaning on the term "seriously" in that context. For example, if the term means "a lot" or "a great deal" it would mean that information which is damaging to a lesser extent, for example, some lesser prejudice, must be disclosed with no need to show that the public interest requires that such damage be caused. We do not believe that that would lead to a proper balance. It would mean that information damaging, for example, to the prevention or detection of serious crime would have to be published. Finally, we must not forget that the interception commissioner must be consulted on the exclusion of any matter from the annual report as laid before each House of Parliament. I hope that the noble Lord, Lord Lucas, is somewhat reassured by that explanation.
  Lord Lucas: I am certainly reassured; I would expect nothing to happen other than what the noble and
  1042
  learned Lord, Lord Nolan, indicated has happened in the past. The Minister used the word "balance", but, as yet, there is no requirement for balance in this part of the Bill. Perhaps we should examine that issue at Report stage. In the meantime I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 54 agreed to.
  Lord Bach Lord Bach moved Amendments Nos. 190A and 190B:
  After Clause 54, insert the following new clause—

  THE INTELLIGENCE SERVICES COMMISSIONER
  (" .—(1) The Prime Minister shall appoint a Commissioner to be known as the Intelligence Services Commissioner.
  (2) Subject to subsection (4), the Intelligence Services Commissioner shall keep under review, so far as they are not required to be kept under review by the Interception of Communications Commissioner—

  (a) the exercise by the Secretary of State of his powers under sections 5 to 7 of the Intelligence Services Act 1994 (warrants for interference with wireless telegraphy, entry and interference with property etc.);

  (b) the exercise and performance by the Secretary of State, in connection with or in relation to—

  (i) the activities of the intelligence services, and

  (ii) the activities in places other than Northern Ireland of the officials of the Ministry of Defence and of members of Her Majesty's forces,

  of the powers and duties conferred or imposed on him by Parts II and III of this Act;

  (c) the exercise and performance by members of the intelligence services of the powers and duties conferred or imposed on them by or under Parts II and III of this Act;

  (d) the exercise and performance in places other than Northern Ireland, by officials of the Ministry of Defence and by members of Her Majesty's forces, of the powers and duties conferred or imposed on such officials or members of Her Majesty's forces by or under Parts II and III; and

  (e) the adequacy of the arrangements by virtue of which the duty imposed by section 51 is sought to be discharged—

  (i) in relation to the members of the intelligence services; and

  (ii) in connection with any of their activities in places other than Northern Ireland, in relation to officials of the Ministry of Defence and members of Her Majesty's forces.

  (3) The Intelligence Services Commissioner shall give the Tribunal all such assistance (including his opinion as to any issue falling to be determined by the Tribunal) as the Tribunal may require—

  (a) in connection with the investigation of any matter by the Tribunal; or

  (b) otherwise for the purposes of the Tribunal's consideration or determination of any matter.

  (4) It shall not be the function of the Intelligence Services Commissioner to keep under review the exercise of any power of the Secretary of State to make, amend or revoke any subordinate legislation.
  (5) A person shall not be appointed under this section as the Intelligence Services Commissioner unless he holds or has held a high judicial office (within the meaning of the Appellate Jurisdiction Act 1876).
  (6) The Intelligence Services Commissioner shall hold office in accordance with the terms of his appointment; and there shall be paid to him out of money provided by Parliament such allowances as the Treasury may determine.
  (7) The Secretary of State shall, after consultation with the Intelligence Services Commissioner and subject to the approval of the Treasury as to numbers, provide him with such staff as the Secretary of State considers necessary for the carrying out of the Commissioner's functions.
  (8) Section 4 of the Security Service Act 1989 and section 8 of the Intelligence Services Act 1994 (Commissioners for the purposes of those Acts) shall cease to have effect.
  (9) On the coming into force of this section the Commissioner holding office as the Commissioner under section 8 of the Intelligence Services Act 1994 shall take and hold office as the Intelligence Services Commissioner as if appointed under this Act—

  (a) for the unexpired period of his term of office under that Act; and

  (b) otherwise, on the terms of his appointment under that Act.

  (10) Subsection (7) of section 39 shall apply for the purposes of this section as it applies for the purposes of that section.").
  After Clause 54, insert the following new clause—

  CO-OPERATION WITH AND REPORTS BY INTELLIGENCE SERVICES COMMISSIONER
  (" .—(1) It shall be the duty of—

  (a) every member of an intelligence service,

  (b) every official of the department of the Secretary of State, and

  (c) every member of Her Majesty's forces,

  to disclose or provide to the Intelligence Services Commissioner all such documents and information as he may require for the purpose of enabling him to carry out his functions under section (The Intelligence Services Commissioner).
  (2) As soon as practicable after the end of each calendar year, the Intelligence Services Commissioner shall make a report to the Prime Minister with respect to the carrying out of that Commissioner's functions.
  (3) The Prime Minister shall lay before each House of Parliament a copy of every annual report made by the Intelligence Services Commissioner under subsection (2), together with a statement as to whether any matter has been excluded from that copy in pursuance of subsection (4).
  (4) If it appears to the Prime Minister, after consultation with the Intelligence Services Commissioner, that the publication of any matter in an annual report would be contrary to the public interest or prejudicial to—

  .(a) national security,

  (b) the prevention or detection of serious crime,

  (c) the economic well-being of the United Kingdom, or

  (d) the continued discharge of the functions of any public authority whose activities include activities that are subject to review by that Commissioner,

  the Prime Minister may exclude that matter from the copy of the report as laid before each House of Parliament.
  (5) Subsection (7) of section 39 shall apply for the purposes of this section as it applies for the purposes of that section.").
  On Question, amendments agreed to.
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 190C:
  After Clause 54, insert the following new clause—

  INVESTIGATORY POWERS COMMISSIONER FOR NORTHERN IRELAND
  (" .—(1) The Prime Minister, after consultation with the First Minister and deputy First Minister in Northern Ireland, shall appoint a Commissioner to be known as the Investigatory Powers Commissioner for Northern Ireland.
  (2) The Investigatory Powers Commissioner for Northern Ireland shall keep under review the exercise and performance in Northern Ireland, by the persons on whom they are conferred or imposed, of any powers or duties under Part II which are conferred or imposed by virtue of an order under section 29 made by the First Minister and deputy First Minister in Northern Ireland acting jointly.
  (3) The Investigatory Powers Commissioner for Northern Ireland shall give the Tribunal all such assistance (including his opinion as to any issue falling to be determined by the Tribunal) as the Tribunal may require—

  (a) in connection with the investigation of any matter by the Tribunal; or

  (b) otherwise for the purposes of the Tribunal's consideration or determination of any matter.

  (4) It shall be the duty of—

  (a) every person by whom, or on whose application, there has been given or granted any authorisation the function of giving or granting which is subject to review by the Investigatory Powers Commissioner for Northern Ireland,

  (b) every person who has engaged in conduct with the authority of such an authorisation.

  (c) every person who holds or has held any office, rank or position with the same public authority as a person falling within paragraph (a), and

  (d) every person who holds or has held any office, rank or position with any public authority far whose benefit (within the meaning of Part II) activities which are or may be subject to any such review have been or may be carried out, to disclose or provide to that Commissioner all such documents and information as he may require for the purpose of enabling him to carry out his functions.

  (5) As soon as practicable after the end of each calendar year, the Investigatory Powers Commissioner for Northern Ireland shall make a report to the First Minister and deputy First Minister in Northern Ireland with respect to the carrying out of that Commissioner's functions.
  (6) The First Minister and deputy First Minister Ireland shall lay before the Northern Ireland Assembly a copy of every annual report made by the Investigatory Powers Commissioner for Northern Ireland under subsection (5), together with a statement as to whether any matter has been excluded from that copy in pursuance of subsection (7).
  (7) If it appears to the First Minister and deputy First Minister in Northern Ireland, after consultation with the Investigatory Powers Commissioner for Northern Ireland, that the publication of any matter in an annual report would be contrary to the public interest or prejudicial to—

  (a) the prevention or detection of serious crime, or

  (b) the continued discharge of the functions of any public authority whose activities include activities that are subject to review by that Commissioner, they may exclude that matter from the copy of the report as laid before the Northern Ireland Assembly.

  (8) A person shall not be appointed under this section as the Investigatory Powers Commissioner for Northern Ireland unless, he holds or has held office as a county court judge in Northern Ireland.
  (9) The Investigatory Powers Commissioner for Northern Ireland shall hold office in accordance with the terms of his appointment; and there shall be paid to him out of the Consolidated Fund of Northern Ireland such allowances as the Department of Finance and Personnel may determine.
  (10) The First Minister and deputy First Minister in Northern Ireland, after consultation with the Investigatory Powers Commissioner for Northern Ireland, provide him with such staff as they consider necessary for the carrying out of his functions.").
  The noble Lord said: This group of amendments introduces a new role for an investigatory powers commissioner for Northern Ireland. The new commissioner has a clearly circumscribed role—one which is circumscribed in three ways. First, it is limited to Northern Ireland. Secondly, it is limited to actions under Part II of the Bill; that is, to direct surveillance and covert sources. Thirdly, the role of the commissioner is limited to the actions of public authorities, the responsibility for which is transferred to the First Minister and Deputy First Minister in Northern Ireland and the Northern Ireland Assembly.
  When the Bill was introduced in another place, it contained a role of the covert investigations commissioner. The role of that covert investigations commissioner was to oversee the actions of public authorities, other than the police and Customs, and the intelligence agencies under Part II of the Bill. Representations were received to the effect that the role could usefully be bound up within that of the chief surveillance and surveillance commissioners, already established under the Police Act 1997. That change was made by amendment in another place.
  It is a simple creation and I hope that I have given adequate information on the purpose and effect of the provision. I beg to move.
  On Question, amendment agreed to.
  Clause 55 [Additional functions of other Commissioners]:
  Lord Bach Lord Bach moved Amendments Nos. 190D to 191B:
  Page 59, line 6, leave out subsections (1) and (2).
  Page 60, line 2, leave out from first ("the") to end of line 3 and insert ("Intelligence Services Commissioner").
  Page 60, line 3, at end insert ("or the Investigatory Powers Commissioner for Northern Ireland").
  Page 60, line 14, leave out subsection (4).
  Page 60, line 21, leave out ("any") and insert ("the Chief Surveillance").
  Page 60, line 33, leave out subsection (7).
  On Question, amendments agreed to.
  Clause 55, as amended, agreed to.
  Lord Bach Lord Bach moved Amendment No. 192:
  After Clause 55, insert the following new clause—

  ASSISTANT SURVEILLANCE COMMISSIONERS
  (".—(1) The Prime Minister may, after consultation with the Chief Surveillance Commissioner as to numbers, appoint as Assistant Surveillance Commissioners such number of persons as the Prime Minister considers necessary (in addition to the ordinary Surveillance Commissioners) for the purpose of providing the Chief Surveillance Commissioner with assistance under this section.
  (2) A person shall not be appointed as an Assistant Surveillance Commissioner unless he holds or has held office as—

  (a) a judge of the Crown Court or a Circuit judge;

  (b) a sheriff in Scotland; or

  (c) a county court judge in Northern Ireland.

  (3) The Chief Surveillance Commissioner may require any ordinary Surveillance Commissioner or any Assistant Surveillance Commissioner to provide him with assistance in carrying out his functions under section 55(3).
  (4) The assistance that may be provided under this section includes—

  (a) the conduct on behalf of the Chief Surveillance Commissioner of the review of any matter; and

  (b) the making of a report to the Chief Surveillance Commissioner about the matter reviewed.

  (5) Subsections (3) to (8) of section 91 of the Police Act 1997 (Commissioners) apply in relation to a person appointed under this section as they apply in relation to a person appointed under that section.").
  On Question, amendment agreed to.
  Clause 56 [Delegation of Commissioners' functions]:
  Lord Bach Lord Bach moved Amendments Nos. 192A to 193:
  Page 60, line 40, leave out from first ("the") to ("or") in line 41 and insert ("Intelligence Services Commissioner").
  Page 60, line 41, after first ("Commissioner") insert (", the Investigatory Powers Commissioner for Northern Ireland").
  Page 60, line 41, at end insert ("or Assistant Surveillance Commissioner").
  On Question, amendments agreed to.
  Clause 56, as amended, agreed to.
  Lord Cope of Berkeley Lord Cope of Berkeley had given notice of his intention to move Amendment No. 194:
  After Clause 56, insert the following new clause—

  INVESTIGATORY POWERS COMMISSION
  (" .—(1) There shall be an Investigatory Powers Commission consisting of—

  (a) the Commissioner under section 8 of the Interception of Communications Act,

  (b) the Security Service Act Commissioner,

  (c) the Intelligence Services Act Commission.

  (d) the Chief Surveillance Commissioner, and

  (e) such additional Commissioners as the Secretary of State shall appoint by order.

  (2) The Secretary of State shall by order provide for the discharge under the general direction of the Commission of any of the functions of each of the Commissioners.
  (3) The Secretary of State shall appoint one of the Commissioners to be chairman of the Commission.
  (4) Schedule (Investigatory Powers Commission) shall have effect with respect to the Commission.
  (5) No order shall be made under this section unless a draft of it has been laid before Parliament and approved by a resolution of each House.").
  The noble Lord said: In view of our previous discussions, I do not wish to pursue this matter. Therefore, I do not propose to move Amendment No. 194.
  [Amendment No. 194 not moved.]
  Clause 57 [The Tribunal]:
  Lord Bach Lord Bach moved Amendments Nos. 194A to 195B:
  Page 61, line 41, leave out paragraph (e).

  1047
  Page 62, line 2, leave out (",(e)").
  Page 62, line 25, at end insert ("or under any enactment contained in or made under an Act of the Scottish Parliament which makes provision equivalent to that made by that Part").
  Page 62, line 33, leave out subsection (10).
  Page 62, line 45, leave out from ("making") to end of line 47 and insert ("of any disclosure in an intelligible form (within the meaning of section 52) of protected information by a person who is or has been in possession of the key to that information").
  On Question, amendments agreed to.
  Clause 57, as amended, agreed to.
  [Amendment No. 196 not moved.]
  Schedule 2 [The Tribunal]:
  Lord Bach Lord Bach moved Amendment No. 197:
  Page 85, line 26, at end insert—
  ("(6) If the Scottish Parliament passes a resolution calling for the removal of a member of the Tribunal, it shall be the duty of the Secretary of State to secure that a motion for the presentation of an Address to Her Majesty for the removal of that member, and the resolution of the Scottish Parliament, are considered by each House of Parliament.").
  The noble Lord said: In moving Amendment No. 197, I wish to speak also to Amendments Nos. 198 and 200. I referred earlier to the decision of the Scottish Executive and Parliament to use the commissioners established under this Bill for oversight of the authorisations permitted under the Regulation of Investigatory Powers (Scotland) Bill. I applaud their decision to introduce such consistency across the UK. We believe that it is important, notwithstanding the move to devolution, that the use of such powers is used consistently across the Scottish Border as far as possible. After all, our shared objective is compatibility with convention rights.
  The Scottish Executive has also elected to use the tribunal established under this Bill to provide the means of redress in instances where individuals may feel that it is owed to them after the use of the powers in this Bill. Again, we applaud that decision. Amendments Nos. 197, 198 and 200, tabled in the Government's name, are consequential on the decision of the Scottish Executive to use the tribunal in that way. The amendments in question grant a direct involvement for the Scottish Parliament or Ministers in key decisions which affect the operation of the tribunal. Those are, first, the removal of a member of the tribunal; secondly, the making of an order setting out the remedies available from the tribunal; and, thirdly, the making of rules for the tribunal.
  Those three aspects are important to the operation of the tribunal. The Scottish Ministers and Parliament have a key interest in the operation of the tribunal and the amendments reflect that interest and give them significant impact into key decisions made. I hope that the amendments are welcome to the Committee. I beg to move.
  On Question, amendment agreed to.
  Schedule 2, as amended, agreed to.
  Clause 59 [Exercise of the Tribunal's jurisdiction]:
  Lord Bach Lord Bach moved Amendment No. 198:
  Page 64, line 47, at end insert —
  ("(12) The Secretary of State shall consult the Scottish Ministers before making any order under subsection (8); and any such order shall be laid before the Scottish Parliament.").
  On Question, amendment agreed to.
  Clause 59, as amended, agreed to.
  Midnight
  Clause 60 [Tribunal procedure]
  Lord Bach Lord Bach moved Amendments Nos. 198A to 199:
  Page 66, line 24, leave out from first ("the") to ("or") in line 25 and insert ("Intelligence Services Commissioner").
  Page 66, line 25, after first ("Commissioner") insert (", the Investigatory Powers Commissioner for Northern Ireland").
  Page 66, line 25, at end insert ("or Assistant Surveillance Commissioner").
  On Question, amendments agreed to.
  Clause 60, as amended, agreed to.
  Clause 61 [Tribunal rules]:
  Lord Bach Lord Bach moved Amendment No. 200:
  Page 68, line 43, at end insert—
  ("(12) The Secretary of State shall consult the Scottish Ministers before making any rules under this section; and any rules so made shall be laid before the Scottish Parliament.").
  On Question, amendment agreed to.
  Clause 61, as amended, agreed to.
  Clauses 62 and 63 agreed to.
  Clause 64 [Effect of codes of practice]:
  Lord Cope of Berkeley Lord Cope of Berkeley moved Amendment No. 200ZA:
  Page 70, line 8, leave out subsection (2).
  The noble Lord said: The Law Society of Scotland drew my attention to this point. The issue is what effect the codes of practice—about which we have heard a good deal and been promised even more—will have if a failure to comply with them will not render a person liable to criminal or civil proceedings. They seem to be rather toothless. I beg to move.
  Lord Bassam of Brighton: Our purpose is to draw a clear distinction between the duties imposed by the Bill and those imposed by codes of practice. The Bill sets out fundamental legal obligations, such as the safeguards that must be applied to intercepted material, which are set out in Clauses 14 and 15.
  Codes of practice, on the other hand, exist primarily to provide guidance. There is an obligation in Clause 64(1) on any person exercising or performing a relevant power or duty to have regard to the provision of every code of practice in force, in so far as they are applicable.
  Many other Acts contain an identical provision, such as Section 101(9) of the Police Act 1997. The issue in that case and this is to strike a balance between ensuring that codes are taken seriously and are not toothless and avoiding a person being penalised for

  1049
  not following the exact letter of a code for reasons such as an operational emergency that the code's author could not have foreseen. The lack of a liability also means that codes can be drafted in plain English, without the need for more complicated legal jargon which affords lots of opportunities to imagine things that the words were never intended to say.
  I am sure that the noble Lord appreciates that codes of practice exist to illuminate and illustrate. No doubt he has been involved on many occasions with legislation providing for codes of practice that could be accused of being toothless, but their purpose is to explain matters and make them clear and to enable courts to interpret.
  Lord Cope of Berkeley: I am all in favour of plain English and the Minister has said enough to make me want to think about this matter a little further. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Lord Bach Lord Bach moved Amendments Nos. 200A to 201 B:
  Page 70, line 18, leave out from first ("Act") to ("or") in line 19.
  Page 70, line 21, at end insert ("or
  (e) any Assistant Surveillance Commissioner carrying out any functions of his under section (Assistant Surveillance Commissioners)of this Act,").
  Page 70, line 27, leave out from ("the") to end of line 28 and insert ("Intelligence Services Commissioner").
  Page 70, line 28, at end insert ("or the Investigatory Powers Commissioner for Northern Ireland").
  On Question, amendments agreed to.
  Clause 64, as amended, agreed to.
  Clause 65 [Conduct in relation to wireless telegraphy]:
  Lord Bach Lord Bach moved Amendments Nos. 202 and 203:
  Page 72, line 18, at end insert—
  ("(8A) No regulations shall be made under subsection (4)(g) unless a draft of them has first been laid before Parliament and approved by a resolution of each House.").
  Page 72, line 38, at end insert—
  ("(4) In section 16(2) of that Act (regulations and orders), after "the said powers" there shall be inserted ", other than one containing regulations a draft of which has been approved for the purposes of section 5(8A),".").
  On Question, amendments agreed to.
  Clause 65, as amended, agreed to.
  Clauses 66 and 67 agreed to.
  Lord Bach Lord Bach moved Amendment No. 203A:
  After Clause 67, insert the following new clause—

  SURVEILLANCE ETC OPERATIONS BEGINNING IN SCOTLAND
  (" .—(1) Subject to subsection (2) where—

  (a) an authorisation under the relevant Scottish legislation has the effect of authorising the carrying out in Scotland of the conduct described in the authorisation,

  (b) the conduct so described is or includes conduct to which Part II of this Act applies, and

  1050

  (c) circumstances arise by virtue of which some or all of the conduct so described can for the time being be carried out only outwith Scotland,

  section 26 of this Act shall have effect for the purpose of making lawful the carrying out outwith Scotland of the conduct so described as if the authorisation, so far as is it relates to conduct to which that Part applies, were an authorisation duly granted under that Part.
  (2) Where any such circumstances as are mentioned in paragraph (c) of subsection (1) so arise as to give effect outwith Scotland to any authorisation granted under the relevant Scottish legislation, that authorisation shall not authorise any conduct outwith Scotland at any time after the end of the period of three weeks beginning with the time when the circumstances arose.
  (3) Subsection (2) is without prejudice to the operation of subsection (1) in relation to any authorisation on the second or any subsequent occasion on which any such circumstances as are mentioned in subsection (1)(c) arise while the authorisation remains in force.
  (4) In this section "the relevant Scottish legislation" means an enactment contained in or made under an Act of the Scottish Parliament which makes provision, corresponding to that made by Part II, for the authorisation of conduct to which that Part applies.").
  On Question, amendment agreed to.
  Clause 68 agreed to.
  Clause 69 [Orders, regulations and rules]:
  Lord Bach Lord Bach moved Amendments Nos. 203B to 207:
  Page 75, line 20, leave out from ("instrument") to end of line 22 and insert ("which contains any order made in exercise of a power to which this section applies (other than the power to appoint a day under section 74(2)) but which contains neither").
  Page 75, line 24, after ("12(7),") insert (" 21(9),").
  Page 75, line 24, after ("12(7),") insert (" 27(5),").
  Page 75, line 24, after ("12(7),") insert (" 28(5A),").
  Page 75, line 24 after ("12(7),") insert (" 29(4B),").
  On Question, amendments agreed to.
  Lord Cope of Berkeley Lord Cope of Berkeley moved Amendment No. 208:
  Page 75, line 24, after ("12(7),") insert ("24(5)").
  The noble Lord said: Having been rejected all evening, nevertheless, I am encouraged to try Amendment No. 208. I beg to move.
  On Question, amendment agreed to.
  Lord Bach Lord Bach moved Amendments Nos. 208A to 208C:
  Page 75, line 24, at end insert ("nor").
  Page 75, line 25, leave out from ("applies") to end of line 26.
  Page 75, line 28, at end insert—
  ("( ) A statutory instrument containing any regulations made in exercise of a power to which this section applies shall be subject to annulment in pursuance of a resolution of either House of Parliament.").
  On Question, amendments agreed to.
  Clause 69, as amended, agreed to.
  Clauses 70 and 71 agreed to.
  Clause 72 [General interpretation]:
  Lord Bach Lord Bach moved Amendment No. 209:
  Page 76, line 29, at end insert—
  (""Assistant Surveillance Commissioner" means any person holding office under section (Assistant Surveillance Commissioners);").
  On Question, amendment agreed to.
  Lord Lucas Lord Lucas moved Amendment No. 210:
  Page 76, leave out lines 33 to 39 and insert ("anything which serves to transmit information").
  The noble Lord said: In moving this amendment, I shall speak also to Amendment No. 211. I am always slightly disturbed by those rather jumbled and rambling definitions. For example, the definition of "communication" in paragraph (b) refers to "anything comprising speech" and so on and then paragraph (c) states:
  "signals serving … for the impartation of anything between persons".
  If that is not speech, I do not know what it is, so why is "speech" in there if it is already covered in subparagraph (c)? I suppose there may be some cases of speeches in this Chamber that do not impart information, but thankfully they are rare and I am not sure that we need worry about them in this Bill.
  I have attempted to produce something wider and simpler. When complicated definitions have to be construed in court, the question arises of whether they will start to compare some particular form of communication with the examples in the Bill, decide it does not fit and say that it is not communication, when for the sake of this Bill it ought to be. The same argument applies to the definition of "document", which seems to be quite limited. It includes a number of illustrations which may, in the event, limit the interpretation put on the word. When you look at how it is used in the Bill it ought to be quite broad. I beg to move.
  Lord Bassam of Brighton: Definitions are always difficult. We have had many arguments about definitions during the course of this Bill. The noble Lord has said that he wants to make the definition wider and, therefore, simpler. I usually believe that when a definition is made wider it becomes more complex. The definition of "communication" is based upon wording taken from Section 4 of the Telecommunications Act 1984. We are trying to achieve consistency across legislation and that is the reasoning behind it.
  Communication service providers are familiar with that legislation and we have no wish to confuse the way in which the word "communication" is read in the Bill by introducing a different wording. The courts would be obliged to take account of the different definitions and I believe that that would add to the complexity. In two Acts we would have to read the word differently when we mean the same. I do not believe that making the definition wider makes it simpler; I believe it makes it more complex for the courts.
  The definition of "document" is taken from Section 14(1) of the Electronic Communications Act 2000. I am sure that the noble Lord is familiar with that. Again, it is used in this piece of legislation in a way that we believe achieves consistency. We are keen that the two pieces of legislation should be compatible. The word "document" occurs in the Bill only within the
  1052
  phrase "document or other information", or variations of that phrase. As a consequence, we believe that the amendment is unnecessary. I trust that the noble Lord will, in the interests of efficiency and consistency, feel able to withdraw his amendment.
  Lord Lucas: It is wonderful to know that there is some part of this great planet where the definition of "communication" has not changed since 1984. That fact had passed me by. For the sake of consistency and understanding, I at least should read the Act and ensure that I am happy with the dual context. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 211 not moved.]
  Lord Bach Lord Bach moved Amendments Nos. 211A and 211 B:
  Page 77, leave out lines 10 and 11.
  Page 77, line 23, leave out ("(subject to section 45(7))").
  On Question, amendments agreed to.
  [Amendment No. 212 not moved.]
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 212A:
  Page 77, leave out lines 44 and 45.
  On Question, amendment agreed to.
  12.15 a.m.
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 213:
  Page 78, line 2, at end insert ("or a member of the Senior Management Structure of Her Majesty's Diplomatic Service").
  The noble Lord said: I shall speak also to Amendments Nos. 216 and 217. Amendments Nos. 213 and 217 are government amendments and Amendment No. 216, which we intend to resist, stands in the name of the noble Lord, Lord Cope.
  Amendments Nos. 213 and 217 between them are necessary to take account of the slightly different terminology used in the Diplomatic Service to describe a person of equivalent seniority to a member of the senior Civil Service. The Foreign Secretary may sign interception warrants, and it is necessary that the Bill treat his officials in the same way as it treats those of any other Secretary of State.
  Amendment No. 216 would remove from the Secretary of State the power to amend the definition of "senior official" contained in Clause 72(1). The sole purpose of that power is to cater for the eventuality that a change to the structure or grading of the Civil Service might render the Bill's definition of a "senior official" obsolete—obviously we cannot allow such a thing to happen. Were such a change to be made in a non-statutory way, there would be no means of updating the definition short of primary legislation, which we do not believe would be appropriate.
  I should add that this subsection does not permit the definition of a senior official to be devalued, because it obliges the Secretary of State to ensure that his amendment preserves, so far as practicable, the effect

  1053
  of the existing definition. Hence it would be incumbent upon him to choose that level or designation which best mirrored the current seniority of members of the senior Civil Service. I beg to move.
  Viscount Astor: Perhaps I may speak briefly to Amendment No. 216.
  The Minister has largely answered the points which were the reason we tabled this amendment. However, it would be interesting to know whether or not the Government have any plans to change the definition. Does it happen regularly within the Civil Service? Has it happened recently? Do they expect any changes to take place? It seemed to us that, while we accept that the provision contains a caveat that the Secretary of State has to keep, so far as practicable, the present definition, it is unlikely that the definitions of senior officials change that often.
  Lord Bassam of Brighton: I believe I dealt with that point. We do not have any immediate plans to change the entire structure of the Civil Service. We are trying to ensure that we have the balance right for the purposes of this Bill and ensure that it works for different departments in different ways. I cannot usefully add anything more.
  On Question, amendment agreed to.
  [Amendment No. 214 not moved.]
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 215:
  Page 78, line 47, at end insert—
  ("(4A) For the purposes of this Act detecting crime shall be taken to include—

  (a) establishing by whom, for what purpose, by what means and generally in what circumstances any crime was committed; and

  (b) the apprehension of the person by whom any crime was committed; and any reference in this Act to preventing or detecting serious crime shall he construed accordingly, except that, in Chapter I of Part I, it shall not include a reference to gathering evidence for use in any legal proceedings.").

  The noble Lord said: Each of the six investigatory powers in this Bill can be used for specific purposes enshrined in the Bill. All include the purpose,
  "for the prevention and detection of crime".
  In some cases that is further qualified by the stipulation that the purpose can only be used for serious crime. Precisely what is covered by the term "detection" of crime has never been defined in statute. Operationally, it has generally been taken to mean that powers can be used up to the point of charge. And this interpretation is currently the one adopted, for example, by the surveillance commissioners when giving prior approval to applications for intrusive surveillance made under the Police Act 1997.
  However, in the case of Preston in 1994, the House of Lords considered whether there was a prohibition on the use of intercept material in evidence. That was Section 9 of the Interception of Communications Act.
  1054
  We had a stimulating debate on those provisions—now included in Clauses 16 and 17 of this Bill—last week. In the case of Preston the Judicial Committee reflected on the fact that interception has never been intended to play a part in the prosecution process. The noble and learned Lord, Lord Mustill, when delivering the leading judgment, rejected the view that the prevention and detection of serious crime went beyond,
  "the forestalling of future crimes and the discovery that crimes had been committed in the past, and by whom and in what manner".
  He particularly rejected the view that the detection of crime extended to the,
  "amassing of evidence … with a view to the prosecution of offenders".
  This was not a surprising assessment.
  In the case of Morgans on 17th February of this year, the noble and learned Lord, Lord Mackay, summarised the case law. In respect of the Interception of Communications Act, he clearly stated that the effect of Preston was that,
  "the purposes of preventing or detecting serious crime did not include the purpose of gathering evidence of criminal proceedings in respect of such crime".
  That case provides us with a difficulty in respect of this Bill. A narrow definition of "detection" is satisfactory in the case of interception, though we have tried to ensure even here that the law is as clear as possible. But the same formulation of "prevention and detection" exists in each of the five other powers of the Bill where we most certainly do want the phase to have a wider meaning and to include gathering evidence. Therefore, we believe that we must say what we intend the phrase to mean in each of the places where we use it. That is the purpose of these amendments.
  We have deliberated long and hard over this matter. The result of our deliberations are now tabled before the Committee as Amendments Nos. 215, 222A, 224A and 226. Noble Lords will see from Amendment No. 215 that, across the generality of the Bill, we clarify that detection of crime includes,
  "establishing by whom, for what purpose, by what means and generally in what circumstances any crime is committed; and the apprehension of the person by whom any crime was committed".
  I believe that this clarification should be welcomed. It means that it is possible to use the powers in Chapter II of Part I and in Parts II and III of the Bill for the purpose spelled out in Amendment No. 215.
  I believe that I have dealt with the uncertain areas and the inconsistencies in the expression of "detecting crime" across a number of existing statutes. We have tabled amendments to clarify the meaning in respect of this Bill and related legislation. I beg to move.
  On Question, amendment agreed to.
  [Amendment No. 216 not moved.]
  Lord Bach Lord Bach moved Amendment No. 217:
  Page 79, line 12, leave out ("civil") insert ("home civil service or diplomatic").
  On Question, amendment agreed to.
  [Amendment No. 218 not moved.]
  Clause 72, as amended, agreed to.
  Clause 73 agreed to.
  Schedule 3 [Consequential amendments]:
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 219:
  Page 87, line 7, leave out ("(within the meaning of the Regulation of Investigatory Powers Act 2000)").
  The noble Lord said: The effect of this group of amendments would allow government bodies to continue to use their statutory powers to obtain communications data without committing an offence under the Telecommunications Act 1984—something with which, no doubt, all Members of the Committee will be familiar. Amendment No. 220 is the key amendment in the group, while the remaining amendments are consequential. I beg to move.
  On Question, amendment agreed to.
  Lord Bach Lord Bach moved Amendments Nos. 220, 220A, 221 and 222:
  Page 87, line 11, after ("2000;") insert—
  ("( ) in compliance with any requirement imposed (apart from that Act) in consequence of the exercise by any person of any statutory power exercisable by him for the purpose of obtaining any document or other information;").
  Page 87, line 12, leave out from second ("under") to end of line 13.
  Page 87, line 15, leave out ("any Commissioner appointed under that Act of 2000") and insert ("the Interception of Communications Commissioner").
  Page 87, line 16, at end insert—
  ("(3) In subsection (2) above 'criminal proceedings' and 'statutory power' have the same meanings as in the Regulation of Investigatory Powers Act 2000."").
  On Question, amendments agreed to.
  Lord Cope of Berkeley Lord Cope of Berkeley moved Amendment No. 222ZA:
  Page 87, line 16, at end insert—

  SURVEILLANCE ETC OPERATIONS BEGINNING IN SCOTLAND

    The Legal Aid (Scotland) Act 1986 (c. 47)
    At the end of paragraph 1 of Part I of Schedule 2 there shall be inserted—
    "in the Regulation of Investigatory Powers Tribunal."").
    The noble Lord said: This is a very simple amendment, but one which has some consequences. The Bill provides for a regulation of investigatory powers tribunal. However, the Law Society of Scotland has pointed out to me that the relevant people will not be able to get legal aid as the Bill stands, should they appear before it. The society has suggested that that matter should be considered. I beg to move.
    Lord Bach: This amendment would provide for legal aid to be available in Scotland to applicants to the tribunal. However, the convention is that this Parliament does not legislate on devolved matters. Legal aid is a devolved matter, and the responsibility
    1056
    of the Scottish Executive. As such, it is not possible for the Government to accept the amendment, and I hope that the noble Lord will feel able to withdraw it.
    Lord Cope of Berkeley: In the light of that response, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Bach Lord Bach moved Amendments Nos. 222A and 222B:
    Page 87, line 17, at end insert—
    (" .—(1) In section 1 of the Security Service Act 1989 (functions of the Security Service), after subsection (4) there shall be inserted
    "(5) Section 72(4A) of the Regulation of Investigatory Powers Act 2000 (meaning of 'prevention' and 'detection'), so far as it relates to serious crime, shall apply for the purposes of this Act as it applies for the purposes of the provisions of that Act not contained in Chapter I of Part I."
    (2) In section 2(2)(a) of that Act (duty of Director General to secure that information not disclosed except for authorised purposes), for "preventing or detecting" there shall be substituted "the prevention or detection of".").
    Page 87, line 18, leave out paragraph 4.
    The noble Lord said: These amendments have already been spoken to. I beg to move.
    On Question, amendments agreed to.
    [Amendment No. 223 had been withdrawn from the Marshalled List.]
    Lord Bach Lord Bach moved Amendment No. 223A:
    Page 87, line 35, leave out paragraph 6.
    On Question, amendment agreed to.
    [Amendment No. 224 had been withdrawn from the Marshalled List.]
    Lord Bach Lord Bach moved Amendments Nos. 224A to 226:
    Page 87, line 45, at end insert—
    (". In section 11 of the Intelligence Services Act 1994 (interpretation), after subsection (1) there shall be inserted—
    "(1A) Section 72(4A) of the Regulation of Investigatory Powers Act 2000 (meaning of 'prevention' and 'detection'), so far as it relates to serious crime, shall apply for the purposes of this Act as it applies for the purposes of Chapter I of Part I of that Act." ").
    Page 88, line 14, at end insert ("and after "Commissioners" there shall be inserted "and any Assistant Surveillance Commissioners holding office under section (Assistant Surveillance Commissioners) of the Regulation of Investigatory Powers Act 2000"").
    Page 90, line 15, leave out ("requiring a key to protected information)") and insert ("imposing a disclosure requirement in respect of information protected by a key)").
    Page 90, line 33, at end insert—
    ("(13) In Part VII of that Act, before section 134 there shall be inserted—

    Meaning of 'prevention' and 'detection'.
    133A. Section 72(4A) of the Regulation of Investigatory Powers Act 2000 (meaning of 'prevention' and 'detection') shall apply for the purposes of this Act as it applies for the purposes of the provisions of that Act not contained in Chapter I of Part I." ").
    The noble Lord said: These amendments have already been spoken to. I beg to move.
    On Question, amendments agreed to.
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 226A:
    Page 90, line 45, at end insert—

    The Financial Services and Markets Act 2000 (c. 8)
    In section 394(7) of the Financial Services and Markets Act 2000 (exclusion of material from material of the Authority to which a person must be allowed access), for paragraphs (a) and (b) there shall be substituted—
    "(a) is material the disclosure of which for the purposes of or in connection with any legal proceedings is prohibited by section 16 of the Regulation of Investigatory Powers Act 2000; or"").
    The noble Lord said: Amendment No. 226A would amend the Financial Services and Markets Act 2000, updating its provisions to ensure that intercept material and related sensitive information is protected from disclosure under the new interception regime. It is a technical amendment and it merely updates the language used in that Act. I beg to move.
    Lord Lucas: It appears to me that the Financial Services and Markets Act has hardly reached the statute book before we are seeking to amend it. I am sure that if the noble Lord, Lord McIntosh, had intended that the wording should be included in that Act he would have included it while the Bill was progressing through the Chamber under his tutelage. I am surprised that the noble Lord has the temerity to contradict such an experienced parliamentarian.
    The Earl of Northesk: Following the intervention of my noble friend Lord Lucas, I simply say to the noble Lords, Lord McIntosh and Lord Bach, "Hurrah! No. 1,470." I hope that I have my arithmetic correct.
    On Question, amendment agreed to.
    Lord Bach Lord Bach moved Amendment No. 227:
    Page 90, leave out lines 47 to 50 and insert—
    ("11.—(1) In section 9(2)(d) of the Terrorism Act 2000 (proceedings under the Human Rights Act 1998), for "8" there shall be substituted "7".
    (2) In each of paragraphs 6(3) and 7(5) of Schedule 3 to that Act (references to an organisation and representative in paragraphs 5 and 8 of that Schedule), for "paragraphs 5 and 8" there shall be substituted "paragraph 5".").
    On Question, amendment agreed to.
    Schedule 3, as amended, agreed to.
    Schedule 4 [Repeals]:
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 228:
    Page 91, line 35, column 3, leave out ("11(2)") and insert (" 11(3)").
    The noble Lord said: In moving Amendment No. 228, I shall speak also to Amendment No. 229. I have a long and complicated speech. I am sure that the Committee will wish to hear the whole of my lengthy explanation. Amendment No. 228 corrects an oversight in paragraph 1 of Schedule 3 and amends Section 58(1) of the Post Office Act 1953—I remember
    1058
    it well!—taking account of the amendment previously made to that subsection by Section 11(2) of the Interception of Communications Act 1985. We therefore do not wish to repeal Section 11(2).
    Amendment No. 229 would repeal paragraph 8 of Schedule 3 to the Terrorism Act, currently before Parliament as a Bill. This repeal is consequential to Amendment No. 69, which the Government moved during the first sitting of this Committee. I beg to move.
    On Question, amendment agreed to.
    12.30 a.m.
    Lord Bach Lord Bach moved Amendments Nos. 228A to 229:

    Page 91, column 3, leave out line 37 and insert—

    ("Sections 4 and 5.")

    Page 91, column 3, leave out line 47 and insert—

    ("Sections 8 and 9.")

    Page 92, line 45, at end insert—

    ("2000 c. 00.

    The Terrorism Act 2000.

    In Schedule 3, paragraph 8.")

    The noble Lord said: These amendments have already been spoken to. I beg to move.
    On Question, amendments agreed to.
    Schedule 4, as amended, agreed to.
    Clause 74 [Short title, commencement and extent]:
    Lord Bach Lord Bach moved Amendment No. 230:
    Page 80, line 1, leave out subsections (3) to (5).
    On Question, amendment agreed to.
    Clause 74, as amended, agreed to.
    In the Title:
    Lord Bach Lord Bach moved Amendment No. 231:
    Line 6, leave out ("the establishment of a tribunal with") and insert ("Commissioners and a tribunal with functions and").
    On Question, amendment agreed to.
    Title, as amended, agreed to.
    House resumed: Bill reported with amendments.
    Lord Carter: My Lords, in moving that the House do now adjourn, perhaps I may say that I hope that the Terrorism Bill receives Royal Assent and becomes an Act.
    Moved accordingly, and, on Question, Motion agreed to.
    House adjourned at twenty-eight minutes before one o'clock.