Sitting of 18 January 2002

Preamble
The House met at half-past Nine o'clock
PRAYERS
[MR. SPEAKER in the Chair]
Orders of the Day

  Employee Share Schemes Bill
  Order for Second Reading read.
  9.33 am
  Mr. Mark Lazarowicz: I beg to move, That the Bill be now read a Second time
  I am delighted to speak in support of the Bill. In so doing, I pay tribute to the support that it has received from many Members and from many organisations and bodies outside the House, including the co-operative movement, which first suggested its subject matter, and the employee ownership movement. I declare as an interest the assistance that I received in developing the Bill from the Co-operative party and Job Ownership Ltd.
  The purpose of the Bill is to encourage greater employee ownership by extending the taxation benefits available for employee share schemes to companies that encourage widespread employee ownership. In particular, the Bill would encourage those forms of employee ownership where employee shares are held collectively in an employee trust.
  The measure would also make it easier for employee trusts that hold shares to elect employees as trustees of the shareholding, thus giving employees a direct voice in the management of the business in which they work. Finally, the measure would facilitate the transfer of shares by companies to an employee trust. In some circumstances that cannot be done at present, as it would incur expensive taxation consequences.
  As many hon. Members know, neither employee share schemes nor employee ownership are new ideas in this country. Several schemes designed to promote employee shareholding have been introduced by Labour and Conservative Governments, with support from minority parties. The 1974–79 Labour Government—with strong support from the Liberals—introduced the all-employee profit-sharing share scheme, which was excellent in many respects. After 1979, the Conservative Government introduced the executive share option scheme, which faced some criticism. They also introduced the save-as-you-earn option scheme and, in 1989, the qualifying employee share trust—the QUEST scheme—which was widely supported in the House.
  In 1994, the right hon. and learned Member for Rushcliffe (Mr. Clarke), when he was Chancellor of the Exchequer, made significant improvements to the QUEST scheme, designed to encourage owners of private companies to sell their business, or substantial interests in
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  the business, to their employees. The scheme was especially useful in promoting wider employee share ownership.
  Most recently, under the Labour Government, the all-employee share ownership plan—now the share incentive plan—has further extended the taxation advantages available to encourage employee share ownership and the flexibility with which such schemes can be introduced.
  Employee share schemes have been given cross-party encouragement under the tax system for almost 30 years. Employee ownership itself has a much longer history in the UK. Many Members are aware of the long-established employee-owned business, Scott Bader Commonwealth Ltd., founded in 1920 and employee owned from 1951; 90 per cent. of its employees are members of Scott Bader Ltd., the charitable trust that holds the shares of Scott Bader Company Ltd. In the words of that organisation, membership brings "advantages but also responsibilities", with many employees also serving on the community council that deals with day-to-day problems in the company. The company believes that involvement in decision making encourages commitment from its employees. Scott Bader also undertakes much charity work; that is typical of many companies with high employee involvement and ownership.
  Members will be aware that there are many other successful employee-owned businesses in this country: the John Lewis Partnership and the Arup group are two well-known examples. There are many successful worker co-operatives. All the evidence shows that employee control—whether through employee share ownership or other methods, such as the traditional worker co-operative—brings real benefits to the businesses that introduce them and to their employees.
  Employee-owned companies perform better than average. An investment of £100 in the FTSE all-share index in 1992 would be worth only £186 today. The same investment in a company in the employee ownership index, where more than 10 per cent. of the capital is held by employees other than directors, would be worth £370 today—more than twice as much.
  Other evidence shows that the wider the degree of employee share ownership and employee control the better the results for both businesses and employees. A recent study by Conyon and Freeman shows that UK companies that give shares only to their senior managers experience a significant increase in productivity. However, companies that go further and spread share ownership to all employees achieve a productivity boost of nearly 50 per cent. more than companies that restrict share distribution only to directors or senior managers.
  Evidence shows that wider employee ownership and employee control bring much wider benefits to society. One recent study of worker co-ops in northern Italy showed that towns with higher levels of employee ownership did better in terms of education, health, crime, social participation and perceptions of the social environment—even mortality was significantly lower.
  It is dangerous to generalise too much from one case study, but I know from my experience in Scotland that some of the most successful examples of community regeneration may be found where community owned and controlled businesses have played an important role in

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  building a strong and stable community. There is certainly an indication that wider worker ownership helps in creating successful societies.
  As the legislation stands, however, there is an anomaly in the operation of the taxation advantages available to employee share schemes. Ironically, the very businesses that provide for a high degree of employee ownership and involvement, and are totally or partially employee controlled, are often unable to distribute shares to employees on a tax-effective basis because of their employee-based structure. That anomaly acts as a deterrent to a wider extension of employee ownership, and the Bill seeks to address it. To show how that will be done, I shall now outline the detailed provisions of the Bill.
  I shall first mention clause 1(2), (3) and (4). The current legislation does not allow the introduction of a share incentive plan by some of the United Kingdom's successful and established companies that have long been owned, controlled and run on behalf of all their employees. Typically, many employee-owned companies are owned and controlled by an employee benefit trust, a charitable trust or, in some cases, a mixture of both. The holding of shares in a trust can be an effective way of encouraging a collective employee voice in the management of a business, and of preventing shares from being taken out of employee control—both very laudable objectives. However, the shares of such companies do not qualify under the requirements of the SIP legislation, because the tax benefits of the SIP for the company and its employees are available only if the shares are distributed to individual employees.
  The clause seeks to eliminate that anomaly, which prevents some of the UK's most successful and longest-standing employee-owned businesses from delivering to their employees the tax-efficient benefits of individual share ownership that are now available to most other types of company under the SIP.
  It is difficult for companies in that group, such as the ones that I mentioned earlier, to explain to their employees, who work in a culture of employee ownership, that they are not entitled to the tax incentives now offered for share ownership to employees of their competitors.
  In addition, a collective trust-based scheme of ownership is often a route preferred by transferring business owners who want to pass on their companies, or a significant part of their interests in their companies, to their employees. That may be because the owners may wish to relinquish control gradually, for perfectly good reasons, or because the scheme may require financial contributions from employees over a period. The subsections that I mentioned will therefore allow a SIP to be available in such circumstances.
  I turn now to the second group of provisions contained in the Bill—those set out in clause 1(5). The effect of that subsection will be to make it clear that employee-controlled companies will be able to benefit from a taxation concession available to employee share schemes if the trustees are selected or elected by the employees of the company. The view of the bodies in this country that promote employee ownership is that at present there is considerable uncertainty about whether such provisions are acceptable under the current
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  legislation, and I understand that those who have sought to include what I would term "employee democracy" provisions—the election of trustees by employees—in employee share ownership schemes have had some difficulty in obtaining approval.
  I understand that the view from within the Inland Revenue is that the subsection is not strictly necessary, because the legislation as currently worded does not prevent the appointment of employee trustees. I believe that the Revenue intends to clarify the position in due course by providing information on its website and making available model documents, which are to be drafted.
  Notwithstanding that view, the bodies that make up the movement that supports wider employee share ownership consider the subsection to be very important. They consider that it will remove any doubt that such arrangements are possible and, moreover, place a clear pointer in legislation that employees can indeed become elected trustees of a trust that is set up under a share incentive plan.
  Such specific provision allowing appointment of employee trustees will give employees and their representatives, such as trade unions, the confidence to request employee representation on the trustee body without the fear that they will be told that it is impossible or too difficult under the legislation. Case studies have shown that the most successful results arise from employee share ownership where employees have real involvement and participation in the non-financial—and particularly the decision-making—aspects as well as the financial aspects of share ownership, and that if employees have that greater degree of involvement they will have a greater sense of ownership.
  I take as an example the John Lewis Partnership. A study of results over 17 years showed that, of all UK retailers, it had the highest marginal productivity gain for every new person employed and for every pound invested, and the highest capital and labour productivity in the industry. Studies by the Centre for Tomorrow's Company in the UK and a recent big European study point in the same direction. The more employee share schemes provide for what has been traditionally termed "industrial democracy", the greater the benefits for employees and businesses alike.
  Mr. Mark Prisk: I believe that it is an excellent principle to encourage greater share ownership and involvement in one's company wherever possible. My constituent, Mrs. Jennifer Parry, who works for the John Lewis Partnership, shares my support for the principle of what the hon. Gentleman is trying to achieve, but she is uncertain whether part-time employees might be able to benefit, because of the rule that shares must be held for a minimum of five years to gain tax benefit. Will the hon. Gentleman perhaps enlighten the House on that matter?
  Mr. Lazarowicz: I am not sure whether I can answer the hon. Gentleman's query in detail. The Bill is designed to facilitate as wide a range of schemes as possible. Every employee whom one would want to benefit might not benefit immediately, but I hope that the Bill will put down a marker for future legislation and point in the direction in which the House wants to go.

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  Appointing employee-elected trustees is an extremely effective way to achieve a form of industrial democracy. It is good not only for Britain's employees but for the whole country because the evidence is that such an increase in employee ownership increases productivity—a key Government objective. The more that employees are involved in the ownership and the direction of their business, the better the productivity and the better the results for the country as a whole.
  I emphasise that this provision in the Bill enables employee trustees to be elected by employees. It is an optional provision; it does not force it on any unwilling company or employees, but it is important that such employee ownership be encouraged. Employee ownership is clearly not suitable for all businesses. No one is suggesting that the traditional form of share ownership is not appropriate for very many companies, and in many cases public ownership is the way forward. However, the Bill would move forward the idea that employee ownership is also a valid way—perhaps even the third way—that needs to be encouraged and supported by the Government and the House.
  Mrs. Cheryl Gillan: I am very interested in the Bill and in no way want to put a damper on it, but I should like to pursue the point made by my hon. Friend the Member for Hertford and Stortford (Mr. Prisk), especially on the John Lewis issues. What advice has the hon. Gentleman received? I understand that John Lewis employees are particularly concerned about two main points. First, can the company maintain and provide liquidity to an internal share market, which would have to be created to allow employees to trade their shares?
  Secondly, because of their low-paid and part-time nature, many of the partners in John Lewis may not be able to wait the minimum of five years that they are required to hold the shares before any gain on disposal becomes tax free. Although I understand that the hon. Gentleman may not be able to go into great detail, I and the wider audience outside the House would appreciate it if he would share with the House the advice that he has received and tell us whether he hopes that the Paymaster General will shine light on the problem or whether he has any solutions to those two thorny issues.
  Mr. Lazarowicz: I thank the hon. Lady for her intervention. I cannot offer any detailed advice at this stage. Clearly, as she will appreciate, today's debate is on the Bill's broad principles. No doubt, if the hon. Lady or her hon. Friends wished to pursue those points in detail, they could do so in Committee. However, I have no doubt that my hon. Friend the Paymaster General will be able to outline the Government's position. [Interruption.] I am sure that she will be able to do so. As I suggested to the hon. Member for Hertford and Stortford (Mr. Prisk), the Bill is intended to facilitate a range of options. Indeed, if my hon. Friend made any suggestion that fits the broader intent of the Bill, I am sure that it could be pursued at a later date.
  The provisions in subsection (5) would seek to achieve the objective of facilitating employee representation on trusts. The final set of provisions are set out in subsection (6), which would support the position of companies, especially business owners who want to make a significant move towards employee ownership.
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  Corporation tax relief would be granted up front where a significant block of shares—10 per cent. or more—were transferred to an employee trust.
  Under the SIP provisions, such corporation tax relief is available only when shares are transferred to individual employees under the scheme, but that might take a very long time where a large part of the company is transferred at the outset for the benefit of employees, thus making that route expensive—often prohibitively so—for the company. Such up-front corporation tax relief was available under the previous QUEST legislation. The provisions in subsection (6) would encourage the establishment of employee ownership where businesses are owned wholly on behalf of their employees, largely through trusts.
  The Bill would, if passed, be a modest but significant measure to promote active employee ownership. However, it represents something wider. As I said in my opening remarks, it was originally suggested to me by the co-operative movement. It did so because, as some Members will know, in recent years, the co-operative movement has been working closely with a wide range of organisations that do not have traditional links with the movement.
  Those organisations include, of course, employee-owned businesses—what I term the employee ownership movement and many mutual businesses not only in the financial sector, but in other sectors. They include community businesses and many providers of community and social housing and community leisure facilities. Indeed, they include companies limited by guarantee—a topic of some interest at the moment. They include the exciting and innovative scheme to promote a voice for football supporters in the management and ownership of their football clubs—the supporters direct initiative. [HON. MEMBERS: "Hear, hear."' As the hon. Members can hear, that initiative has considerable support among Labour Members. All those organisations and sectors are now working much more closely than ever before on a common agenda. In effect, a new co-operative and mutual sector is developing.
  Rosemary McKenna: Does my hon. Friend agree that wonderful opportunities now exist in central Scotland, with the development of the Forth and Clyde canal, which has had an impact on many communities throughout the central belt, and that that represents an ideal opportunity for such companies to develop because they will be successful if they have real support from the community?
  Mr. Lazarowicz: Indeed As my hon. Friend may well know, I, as a member of the Select Committee on Scottish Affairs, recently paid a visit, along with a number of Members present in the House today, to the Forth and Clyde canal and saw the wonderful opportunities that it presents to community business in my hon. Friend's constituency and elsewhere. That opportunity indicates the way in which the new co-operative and mutual sector is developing.
  The new sector includes, of course, traditional forms of co-operative activity. It includes new and successful forms of co-operative enterprise, such as the highly successful Co-operative bank, as well as long-established companies, such as the John Lewis Partnership, which has

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  been discussed at some length already. However, lest anyone thinks that such a model of business ownership is valid only for century-old businesses, let me assure him or her that the involvement of employees in their business is as valid and important to what has been called the new economy.
  For example, Poptel—a worker co-operative set up in the mid-1980s—now offers internet services. It has 60 staff based in London and Manchester and a turnover of £6 million. It is the inventor and registry operator of Dot Coop—the new co-operative internet identity. If worker co-ops are not to the taste of every Member, let me refer to Xansa—the consulting information technology and outsourcing group, with a turnover of almost £500 million. It has been quoted on the stock exchange for some six years now, but it is still controlled to a major extent by its staff, who have a 30 per cent. stake in it.
  Mr. Iain Luke: My hon. Friend is listing a series of options for different types of companies, but does he agree that if we could somehow build worker share ownership into some of the larger companies—indeed, the multinational companies—it may reduce their tendency to be foot loose and to take decisions outwith a country that have an impact on the employees in the country in which they operate?
  Mr. Lazarowicz: My hon. Friend makes a very valuable point. I know, from his experience in Dundee, that the problems of foot-loose companies have caused great difficulties in his constituency.
  As I have said already, employee ownership offers real advantages to employees and the businesses that employ them. As we have heard again in the House today, the concept seems to have all-party support. The Government strongly recognise the value of employee share ownership and the contribution that it can make to raising productivity. Support in the House is broad and, outside the House, the Bill is backed by the co-operative movement, Job Ownership Ltd., and many successful employee-owned companies, such as those that I have mentioned. It is backed by the Trades Union Congress, the Industrial Society and many mutual companies, including Nationwide and Standard Life—one of the major employers in my constituency.
  Many hon. Members will have received letters from members of the public or employees of employee-owned companies in support of the Bill. In the fullness of time, some of those individuals and the businesses may well gain some direct benefit from the Bill. Most will not—but they support this measure because they recognise that, as well as its direct impact, the Bill can be an important symbolic expression of the House's wish to support the growth of active employee ownership.
  I urge the House and the Government to give a positive response to that wide coalition of support for the Bill. I hope that the House will show its support for wide employee ownership by supporting the Bill's Second Reading today.
  9.59 am
  Mr. David Lidington: It is a pleasant duty to congratulate the hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) on his speech, which showed
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  that he had immersed himself in the detail of his chosen subject and that he came to it out of a deep belief in the ideas to which the Bill gives expression, and on his success in the ballot. From my experience in my first Parliament, I recall the mixture of delight and terror that one feels when one is successful in the private Members' Bill ballot. He has chosen an important subject that is worthy of debate, and I congratulate him on that.
  It is important to state on behalf of Conservative Members that we fully support the principle that we should encourage and make it easier wherever possible for employees to own shares in the company for which they work. One of the great achievements in British life since the second world war has been the creation of a property-owning democracy. Conservative Members take particular pride in the achievements of the Governments led by my noble Friend Baroness Thatcher of Kesteven in helping to bring that about.
  One of the next steps forward from the achievement of a property-owning democracy must be to search for measures that will build a capital-owning democracy, in which not just those who are fortunate enough to inherit wealth but people from all backgrounds and all parts of the nation will have the opportunity to own and to take responsibility for the sums of capital that can provide them with the security which only a small number of our fellow citizens in previous generations had the fortune to hold. As the hon. Gentleman said, employee share schemes are an important means of seeking to achieve the objective of a capital-owning democracy.
  A profile of British shareholders conducted by MORI on behalf of ProShare, the share ownership promoter, showed that approximately 14 per cent. of all shareholders in this country first became involved in the ownership of shares through an employee share scheme of some sort or another. I do not mean this in a partisan spirit, but a larger percentage—30 per cent. of all shareholders—first became involved in the ownership of shares through the benefits of privatisation schemes. It is important to accept that there is more than one route to more widespread capital ownership. The particular method embodied in the Bill is certainly important and deserves further debate and encouragement.
  Mr. Andrew Love: The hon. Gentleman refers to wider capital ownership, so does he accept that the figures for the United Kingdom have been disappointing, especially compared with the United States, where there is much wider share ownership? Should we not look to the United States for examples of how we could do better in this country?
  Mr. Lidington: I agree very much with the hon. Gentleman. He makes a perfectly valid point. A lesson for those of us on the centre right of British politics is that we should not be afraid to encourage greater employee share ownership. Across the Atlantic, that method of spreading capital more widely is accepted to a greater extent than it has traditionally been in the United Kingdom.
  Shona Mclsaac: If we are to learn from the United States, we must of course avoid scandals such as Enron. We should not accept everything that the United States has done for share ownership.
  Mr. Lidington: I look forward to the continuing debate between the hon. Members for Cleethorpes (Shona

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  McIsaac) and for Edmonton (Mr. Love) about the merits of the United States model. We should never take the methods applied in any other country as a blueprint that necessarily can be applied directly to our circumstances in the United Kingdom. However, since his election to the leadership of the Conservative party, my right hon. Friend the Leader of the Opposition has made a point of stressing that we need actively to consider examples of policy success across the Atlantic and across the channel; and should examine whether some lessons can be applied fruitfully in this country.
  It is good for employees to have a material stake in the success of their employer. That is an important way in which to shape a corporate culture within a firm so that employees feel that they are valued by the enterprise for which they work and that their contributions are taken seriously by its management and directors. As the hon. Member for Edinburgh, North and Leith said, companies benefit when they are able to unlock the enthusiasm, the creativity and the ideas of their work force and can enhance those to the advantage of the enterprise as a whole. Employee share schemes offer one important way of bringing the interests of employer and employee together.
  As the hon. Gentleman pointed out, under Governments of both political colours, there has been a history of initiatives to encourage employee share ownership. He mentioned the save-as-you-earn scheme and the company share option schemes introduced by Conservative Administrations. Those schemes are still in being and currently benefit 1.75 million workers in about 1,200 firms. He also referred to the approved profit sharing schemes and the qualifying employee share trusts—QUESTs—that were introduced by Conservative Governments in the 1980s and that have been replaced by this Government's share incentive plan, the so-called SIP.
  At the time of the introduction of SIP in the Finance Acts of 2000 and 2001, we took the view that the Government's measures were in some ways an improvement but in others worse than the schemes that they replaced. However, we were prepared to give the new schemes broad support. I hope that, when the Paymaster General responds to the debate, she will be able to bring us up to date with the Government's assessment of the success of the SIP scheme so far.
  A press release from ProShare dated earlier this month said that 220 schemes had now been approved and that more than half the firms involved had fewer than 250 employees. That shows that smaller firms are becoming involved to a greater extent than before. That is clearly good news, but the Chancellor's stated aim is to have 1.750 schemes, which is the figure that was produced in the Government's impact assessment when they brought the legislation before Parliament. I would therefore be interested in the Paymaster General's assessment of how long it will be before that target is met. She will know that there have been criticisms from the financial services industry about the new schemes' complexity and the bureaucratic obstacles in the way of operating them. Some fears have been expressed that that might deter firms that might otherwise be attracted to this method of encouraging employee participation.
  We welcome the hon. Gentleman's Bill as an opportunity to debate the issue further and to explore the merit of specific proposals for reform. I hope that I do not disappoint him too much if I say that I cannot promise to
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  adopt his Bill lock, stock and barrel as official Conservative party policy. We take his points seriously, and they are embodied in the Bill. A number of detailed matters need to be debated, however. We do not oppose the Bill's Second Reading and I hope that it will proceed to a Standing Committee and beyond so that it receives the close scrutiny that it deserves and we can resolve some of my questions about its detail.
  As the hon. Member for Edinburgh, North and Leith said, the Bill's measures can be divided into three. The first is the proposal to broaden the opportunity to participate in a SIP to include employee-owned companies. He mentioned some of those, including the John Lewis Partnership and the Arup group, and demonstrated that there is a gap in existing arrangements. Perhaps that can best be illustrated by referring to the John Lewis Partnership. I am grateful to its representatives, whom I met, for briefing me on the Bill.
  Paragraph 61 of schedule 8 of the Finance Act 2000 defines those shares that are eligible for inclusion in a SIP. First, they have to be listed on a stock exchange. The trouble is that the only class of John Lewis shares so listed are preference shares, which the legislation specifically excludes from eligibility. Secondly, shares are eligible if they are in a company that is not under the control of another company. The structure of the John Lewis Partnership means that the shares in the plc are controlled by a corporate trustee and are treated in law as the shares of a subsidiary, which therefore makes them ineligible.
  The third criterion for eligibility might get John Lewis out of its hole. Shares are eligible for a SIP if they are in a company that is a subsidiary, other than a closed company, and listed on a stock exchange. The trouble is that the Inland Revenue ruled that the John Lewis Partnership counts as a closed company. It is ineligible for the SIP arrangements because it has fewer than five shareholders, which is a result of its particular corporate structure and the involvement of the corporate trustee. Although it looks like the Bill might fill a gap in the arrangements, I wonder whether it would deliver the benefits that the hon. Gentleman and the Bill's sponsors wish to see.
  John Lewis told me that it supports the Bill, but it also explained that it would not be a panacea. My hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) alluded to some of the possible difficulties. It might be hard for such a company to create a class of ordinary shares that meets legislative requirements and complies with the obligations in the partnership's trust settlements. It might be awkward in practice to establish an internal share market, which would have to be created if we were to allow employees in such a company to trade in shares. In addition, as my hon. Friend the Member for Hertford and Stortford (Mr. Prisk) said, many retail workers are part-time or low-paid employees. We have to wonder whether an SIP is the right savings vehicle for such people. Is the five-year period during which planned shares have to be held before tax benefits accrue realistic for them? Again, I have to wonder whether that aspect of the Bill will be as beneficial as the hon. Gentleman hopes it will be.
  The second broad proposal is to allow employees who are elected by the work force to sit as trustees. I have no objection to that in principle. If it makes workers more involved with the decisions of a trust and gives them a sense of ownership and a greater stake—in the wider

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  sense of the word—in the fortunes of their company, then that is welcome. Questions again arise, however. Would it be wise to allow, as the Bill does, the majority of trustees to be non-professional, given the considerable obligations that fall on trustees to look after the assets of their co-workers? Should there be a definition in legislation of the way in which such employee trustees are to be chosen?
  The hon. Gentleman and some of the commentary in support of his proposals suggest that the Bill would provide for elected employee representatives to sit as trustees, but the Bill does not lay down a method of election, nor does it say that that election should take place. There is not even an enabling power for the Chancellor of the Exchequer to make regulations to define a method of election. The Bill does not specify that there has to be a secret ballot, nor does it stipulate the period of trusteeship before a worker trustee has to seek re-election.
  Mr. Ken Purchase: The hon. Gentleman raises important matters of detail. Would it not be sensible, however, to deal with elections in the framework of the memorandum and articles rather than including them in the Bill and having to sort them out now?
  Lidington: That is a reasonable point, but I would want to explore in Committee and on Report whether that is the best approach. It might be better to stipulate it in law or, more probably, secondary legislation through regulations, which would receive parliamentary scrutiny.
  The third proposal is to change the arrangements for corporation tax relief. I am sure that the hon. Gentleman will not mind my being amused at the irony of ditching tax relief arrangements for some schemes which were introduced by the Government in favour of those introduced by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) in QUESTs. That also gives rise to some questions. I have not formed a final view on the matter and think that there should be wide consultation with interested parties and the business community in general. Is it right to limit those corporation tax relief advantages to some employee share schemes rather than giving them to all such schemes? Is 10 per cent. the right threshold if we are to distinguish between schemes? How do the corporation tax arrangements set out in the Bill interact with those set out in paragraph 106 of schedule 8 of the 2000 Act?
  That leads me to two questions about the Bill as a whole. One is about the possible cost to the Government of the Bill's changes to corporation tax relief. Inevitably, if the Bill provides for more generous corporation tax relief than is covered in present legislation, there is bound to be some cost to the public purse in terms of revenues forgone. Clearly, before Parliament agrees to let the Bill proceed to the statute book, it would be right to know the best estimate of the revenue which will be forgone.
  I do not blame the hon. Member for Edinburgh, North and Leith for this, but he has not been able so far in the debate to provide such an estimate. I am sure that the Treasury and Inland Revenue have been doing some number crunching, and I hope that the Minister will be able to come up with an estimate when she speaks—if she catches your eye, Mr. Deputy Speaker.
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  The House needs to bear in mind not just the immediate cost of the Bill. After all, the reason why the Government decided to change the corporation tax relief arrangements that they inherited was the way in which, they argued, those arrangements were increasingly used by companies to avoid considerable amounts of tax, thus offering scope for growth in legal tax avoidance. In the words of a commentary from ProShare that was distributed at least to some hon. Members this morning:
  "in 1997 clever tax advisers spotted the generosity of the legislation—the upfront Corporation Tax relief for the company—and began to market the use of QUESTs to FTSE companies."
  Of course, the clever officials in the Treasury realised what was going on. Changes to legislation were introduced, but comparable things have happened and will continue to happen in various aspects of tax legislation. The House will want to hear from the Minister how the Government assess both the likely immediate cost, were the Bill to become law, and whether the Bill as drafted would allow scope for growth in legitimate avoidance of tax as people latched on to the corporation tax advantages that the arrangement would bring. We need to be aware of that risk.
  We also need to ask about the compliance costs of the legislation. Again, as the hon. Member for Edinburgh, North and Leith will know, any Government Bill must be accompanied by a compliance cost assessment of what it will mean to industry. It is a private Member's Bill, so I do not expect him to come up with the sort of audit that Whitehall is capable of providing, but the Government's view on that matter would be welcome.
  The Government's regulatory impact assessment for the SIP legislation suggested that a large company would face start-up costs of between £200,000 and £750,000 when it first established an SIP, plus annual running costs of between £100,000 and £200,000. The estimates for smaller companies, by which the Government meant companies employing about 50 people, were start-up costs of between £20,000 and £40,000 and annual running costs of between £15,000 and £30,000, possibly capable of being reduced to about £10,000 in some circumstances.
  We therefore need to take seriously the possible costs of these measures both to the Treasury in terms of revenue forgone and to businesses themselves in terms of possible burdens. If those administrative costs are excessive, the Bill will not have the beneficial impact that its sponsors wish. We need to consider in Committee and on Report whether it is right to amend the law in that way.
  Mr. David Drew: I hear what the hon. Gentleman says and am pleased to hear that the Opposition Front-Bench team supports the Bill in principle; but does he agree that there is prevailing unfairness about the way in which we treat mutuals? There is greater complexity than there needs to be. Often, they are exempted from what other public and sometimes private businesses can gain access to. This Bill is about putting right those wrongs.
  Mr. Lidington: The Bill is about trying to encourage both employee share ownership in companies that at present cannot take part in the SIP arrangements and worker ownership—greater mutuality, or however the hon. Gentleman wishes to describe it. There are certainly advantages to mutuality. As the hon. Member for

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  Edmonton said, we should consider carefully why such arrangements appear to be more successful and more widespread in the United States than they are here, and the benefits that they undoubtedly bring, but we do not want to pretend that mutuality is an answer to everything. There are merits in the orthodox idea of a firm with shareholders who hold a board of directors to account. The largest private sector employer in my constituency is what used to be Equitable Life, so mutuality is no guarantee that the right decisions will be taken.
  Mr. Love: In the Finance Act 2000, the Government in their great wisdom extended SIPs to redeemable shares of industrial and provident societies. The Bill will extend SIPs to employee trusts. As yet we have not been able to find a mechanism to extend it to mutually owned businesses such as building societies. Will the Opposition parties join the Government in trying to give the benefits of employee share ownership to mutual organisations?
  Mr. Lidington: I am happy to say that we are very willing to explore ways in which that may be done, subject to what I have said about costs both to Government and to the business sector, but the principles set out by the hon. Member for Edinburgh, North and Leith are good. It is right to seek to expand the opportunities for employee share ownership and to look for ways in which to make workers feel that they have a real stake in the company by which they are employed. If we can devise the right arrangements in which to embody those principles, I agree that the economy will be more productive and the prosperity of all our citizens will be enhanced. It is in that spirit that Conservative Members will be happy to see the Bill gain a Second Reading and continue to be given the detailed consideration that it merits.
  10.28 am
  Mr. Adrian Bailey: I support the Bill and congratulate my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz) on the slot that he drew in the private Members' ballot. I thank him for choosing this subject as the basis of the Bill.
  I should make it clear that I have been a lifelong supporter of co-operative principles and of the co-operative movement. Indeed, I was an employee of the co-operative movement for 18 enjoyable and rewarding years. I am proud to stand in the Chamber and say that I am a Labour and co-operative Member of the House.
  Although the Bill does not directly promote co-operatives, it reinforces the principle of democratic participation in companies by employees, and gives staff the right to share in the appreciating value of their company, which their labour has helped to build. Both are values and principles held most dear by the co-operative movement. As my hon. Friend the Member for Edinburgh, North and Leith and the hon. Member for Aylesbury (Mr. Lidington) said, the Bill is the latest in a sequence of measures; it would tidy up anomalies that have arisen out of legislation introduced by both Labour and Conservative Governments to provide a corporate legislative framework that will enable capital and labour to work together for the benefit of both.
  Historically, Britain's industrial performance has been dogged by tensions between capital and labour. Reading the Bill brought to my mind a book and film that many
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  hon. Members will remember: "I'm All Right, Jack". Starring the late Peter Sellers, the film caricatured the bitterness of industrial relations under the old-style capitalist management prevalent in the immediate post-war years. I do not claim that the attitudes portrayed in the film were typical of all companies, but there is no doubt that the tensions it portrayed were reflected in our industries for many years following the war.
  The Bill is the product of a new era. The old tensions led to strikes, the consequences of which were sometimes devastating to our economy, staff employed and companies themselves. Even when companies survived without such tensions, the corporate framework in which they worked meant that they were unable to harness the collective talents of employees or stimulate their collective initiative in a way that added value to the companies' managerial strategy.
  There is a world of difference between the contribution of an employee who goes to work, clocks on or signs in, does a conscientious day's work for his day's pay and then goes home, forgetting about his work, and an employee of a company in which employees have a share and participate. He goes into work feeling part of that company, wanting to contribute, looking for ways to increase efficiency; he works with colleagues who are in the same position to promote new ideas and more effective working arrangements. The Bill promotes the sort of corporate framework in which the latter can thrive.
  Employees who are confident that their ideas will be listened to and respected, and who know that if those ideas are implemented and are successful they will benefit from the additional productivity generated, are far more likely to be positively committed to their work than those who are not. The Bill is one of those rare pieces of legislation from which everyone is a potential winner.
  The economy should gain from increased productivity. As my hon. Friend the Member for Edinburgh, North and Leith said, the latest research in the United States demonstrates the gains made in productivity in companies in which there is wider share ownership and participation. From my perspective as a lifelong supporter of co-operation and the principles that lie behind it, it is good to know that there is now a body of statistical evidence that demonstrates the principle—the instinctive feeling—that the system set out in the Bill embodies the right way forward. No wonder the model is more advanced in the United States than in this country.
  The Bill will assist the development of a new enterprise culture, wherein people are encouraged to invest responsibly and develop confidence in doing so. The hon. Member for Aylesbury highlighted the contribution that Conservative Governments made in creating a property-owning democracy—although tempted to intervene, I resisted the urge to point out that for many it subsequently became a property-owing democracy. The hon. Gentleman rightly spoke about the steps taken to increase the number of people who owned shares and became used to handling them. The great virtue of the Bill, as opposed to the Conservatives' privatisation measures, is that it promotes responsible long-term use of shares, rather than their purchase for quick short-term profit. It would be interesting to carry out research into the relative duration of ownership of shares by those who purchase them via the Bill's mechanism, compared to those who purchased shares in the privatisations, but I shall not divert the debate by speculating on that point.

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  Individual companies are clearly likely to gain from having better motivated staff with lower rates of absenteeism and unpunctuality. Participation in decisions by employee representatives leads to greater understanding of company business and acts as a unifying force among staff. The employees gain from the wealth created by the improved working environment and the confidence created by decision making and being able to take greater control of their lives.
  The Bill would correct some of the deficiencies in legislation made under previous Governments. Hon. Members on both sides of the House recognise the merits of its approach. I am pleased to commend the Opposition on following the logic of legislation introduced by Conservative Governments and supporting the Bill in principle. I especially welcome the provisions that widen the range of companies eligible for tax relief on employee share holding. My hon. Friend the Member for Edinburgh, North and Leith spoke eloquently about the irony of a company such as John Lewis Partnership, which is regarded as a model of employee participation, being excluded by previous legislation. The Bill would correct that anomaly.
  The Bill also makes provision for companies that set up share trusts, facilitating the process whereby democratic elections can be held to place employee representatives on the trust. Everyone welcomes the reinforcement of such rights of representation. I applaud the changes that remove tax barriers to enlightened company owners who want to hand over their company to employees, or to make a substantial donation to existing employee trust funds. Hitherto, the obligation to pay corporation tax up front when transferring companies has been a major disincentive, especially when the company is experiencing difficulty and the prospect of a transferred company under employee control surviving is made slimmer by the additional costs incurred under existing legislation.
  The Bill gives new hope and new scope to a new generation of entrepreneurs—the example of Poptel was quoted. It gives new entrepreneurs, working in new areas, looking for new methods and pioneering new ways of working, new scope to set up corporate models that will maximise the talents of their work force.
  When I first looked at the Bill, I could not help but reflect that company law and tax law are probably the driest and most arcane areas of the law. This Bill is a combination of both. However, we must recognise that, despite that, the forces that the Bill seeks to liberate are potentially revolutionary. It seeks wealth creation by recognising and rewarding innovation; wealth distribution by spreading the benefits of wider share ownership; and education and confidence building by including people in vital corporate decision making, which hitherto has been denied them. Despite the Bill's dryness, those are vital parts of a developing new economy, and I hope that everyone who shares the aspirations reflected in the Bill will join me in supporting the measure.
  10.41 am
  Mr. Edward Davey: I congratulate the hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) not just on the Bill but on the way
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  in which, having done so well in the ballot, he made his choice and formed the proposals. He consulted widely inside and outside the House, which is a model approach to producing proposals for hon. Members who want to ensure that their legislation achieves a consensus. He deserves congratulations from hon. Members on both sides of the House.
  The hon. Gentleman and the hon. Member for West Bromwich, West (Mr. Bailey) talked about the history of industrial relations and some of the obstacles that have prevented employee share ownership becoming more widespread in Britain in the past, and about some of the past battles between unions and management. It is good to see that, in many respects, those days are behind us. Proposals such as this have helped to bridge the gap between what used to be seen as the two sides of industry.
  As the hon. Member for Edinburgh, North and Leith said in his short historical analysis of the development of employee share ownership, in the '60s and '70s, the Liberals were great advocates of employee share ownership schemes and, in the Lib-Lab pact in the late '70s, they were extremely successful in persuading the then Labour Government to implement in their Finance Acts some of the first schemes in that area. That set the ball rolling and was important in ensuring that Britain went down that route.
  In recent decades under the previous Conservative Administration, we saw some developments, which in many respects were welcome but which in general tended to suffer from two particular problems. First, not enough of the schemes were all-employee schemes. I well remember that, in my back room days when I was advising my right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) when he was the Liberal spokesman in Committees considering Conservative Government Finance Bills, we tabled amendments to try to persuade the then Government to make more of their employee share ownership schemes all-employee schemes, but there was a lot of opposition to that from the Conservative Government. That was one of their major failings in this area and one reason why we did not make the progress that could have been made from the arrangements in the late '70s.
  That is why 1 start my remarks by praising the Government. In their consultation in the previous Parliament and their proposals for what have turned out to be share-incentive plans, the Government have ensured that all-employee involvement in tax-favoured schemes is a bedrock principle, which we should keep to, maintain and develop. The Government are to be congratulated on dealing with that huge omission from the proposals of previous Conservative Governments.
  Mr. Love: I agree strongly about the principle of all-employee share ownership, but is it not also a practicality in that the research shows that when all employees are part of a scheme it delivers the benefits of performance and productivity?
  Mr. Davey: The hon. Gentleman is exactly right and he slightly anticipates my next remark. The nature of all-employee schemes is that they provide the benefits that have been suggested today: namely, improved productivity.
  The good thing about the Bill, and why it is less modest than the hon. Member for Edinburgh, North and Leith suggested and is a radical step forward, is that it deals

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  with the second problem that the previous Conservative Administration never dealt with: namely, the fact that employee share ownership schemes work best when they involve and encourage employee participation.
  Far too often, employee share ownership schemes are about a new form of remuneration. That is important to employees because remuneration is one reason why people go to work, but, as the hon. Member for Edinburgh, North and Leith said in quoting some of the research, if we are to benefit fully we must move from just a remuneration relationship between employee and employer to a co-ownership of the future of the company, so that the employees or their elected representatives participate in thinking, strategy setting and decision making. If employee share ownership schemes are developed in such a way, we shall see some of the long heralded but yet to be fully achieved benefits of employee share ownership.
  I hope that the Government will not only support the Bill, as I and my Liberal Democrat colleagues will do today, but will listen to the reasons why so many hon. Members support the measure. It is not just about the old forms of employee share ownership; it is about something more. It is about trying to get employees more involved, and giving companies incentives to involve employees more in real control and participation.
  The economic benefits have long been heralded, as I know from my studies of labour market economics at university, about which I read rather too much because I was studying the mid-1980s when there was a flurry of economic articles and books promoting employee share ownership. In particular, I well remember "The Share Economy" by Martin Weitzman, which was one of the seminal works in the early to mid-1980s. He drew on the experience of the Japanese economy and tried to argue that profit-related pay, which may in some cases take the form of employee share ownership, was the answer to stagflation and the reason why the Japanese economy had not suffered from the problems of the British economy.
  Judging from the smiles on hon. Members' faces, they share my scepticism about such claims by Mr. Weitzman and others. It is important that we understand why some of the claims for such schemes are wrong while others are right. People such as Mr. Weitzman argued that moving towards profit-related pay was a way out of the wage inflexibility problem; the fact that nominal and sometimes even real wages are downwardly inflexible, so the labour market fails to clear and there is unemployment when there are demand shocks. They tried to suggest that to get out of that, risks should be transferred from the owners of the company to the workers. That model assumed that people were prepared to take quite a sizeable risk as part of their remuneration. Of course, in reality, that is not so. While employees will take some risk, they will not take the amount required to make practical or real the theoretical models advocated by some. The problem with those models is that they took a top-down view of the benefits of such schemes. They looked at a macro-economy and asked how we could try to get rid of inflation and unemployment; they proposed trying to change the whole labour market macro-economically.
  The real benefits come from a bottom-up or bubbling-up approach, which looks at enterprise at a shop-floor level. If one looks at the relationships between employees and managers—the ways in which they work best and how they can be improved—we see that they are
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  not about risk sharing or risk transfer from the owners to the workers. They are more about a shared vision of where the company is going. It is through a shared vision that one gets productivity improvements; genuine incentives; shared or pooled ideas of how to do things better and improve processes in a company to make sure that the output, whether a service or a good, is produced at a lower unit cost; and improved relationships and morale. It is also the way to achieve better communication, which is one of the genuine benefits of proper all-employee share ownerships schemes that involve extra participation. If one is going to make such schemes a reality, one inevitably gets better communication and, through that, greater understanding, which often ensures that difficulties faced daily or weekly by companies can be tackled by everyone involved in the company.
  Those shop-floor business-based advantages are the theoretical underpinning of the benefits claimed for that type of scheme. They might not reduce stagflation, as Mr. Weitzman suggested some schemes might, but over time they will significantly increase productivity. The Government rightly regard the schemes as being crucial to what they claim is their top economic objective in this Parliament of improving the productivity of the British economy. They should therefore pay particular attention to the Bill introduced by the hon. Member for Edinburgh, North and Leith to see whether they can harness those productivity benefits even more. It is through active ownership that we will secure those benefits.
  The Government are looking at other benefits of share incentive plans. They have tried to suggest that when companies take up SIPs they have the option of introducing performance-related share schemes. Indeed, they have set out proposals with conditions on forfeiture if staff leave early and so on, and particular rules on holding periods for shares. They may have two other objectives in introducing those conditions. The evidence that performance-related pay improves productivity is much less than the evidence for employee participation. That is worth looking at, but the complexity of the arrangements proposed by the Government suggests that some of the benefits may not be as easily obtained as some people have argued.
  The points on forfeiture and holding periods in the Government's SIP schemes are interesting because they may address some companies' problems with staff turnover. For example, sometimes staff leave their company far too quickly, and it loses the benefits of training and building up relationships. Some people may say that the forfeiture and holding period conditions are rigid, but they may be key to the benefits that we are trying to get from the Bill and the Government's proposals. If one wants improved productivity, it is common sense to retain staff a little longer to get the benefits of the training and investment that the company puts into them. I certainly recognise that in paying staff in my own office. I try to encourage them to stay a bit longer by paying them a little bit better, as I believe that that is the way to get more out of one's staff; it is a productivity gain as it reduces staff turnover. Some of the additional objectives in the Government's approach to SIPs are therefore to be welcomed.

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  I now turn to the detail of the Bill. As the hon. Member for Aylesbury (Mr. Lidington) said, it tries to widen the application of available tax reliefs, which is to be welcomed. Figures obtained by the hon. Member for Edmonton (Mr. Love) in a parliamentary question to the Treasury show that, in the first instance, more than 100,000 employees might be eligible as a direct result of the Bill's implementation. Over time, eligibility could further increase. Creating the incentive for companies to adopt the model favoured by the hon. Member for Edinburgh, North and Leith would enable us to experience its key benefits.
  In discussing that part of the Bill, the hon. Member for Aylesbury and some of his colleagues made points also made by John Lewis Partnership. They wonder whether the Bill will achieve its intentions because of problems involving part-time employees and possible liquidity in organisations' internal share markets. The House and the Committee considering the Bill should try to explore those valid concerns with John Lewis Partnership, the Government and others. It is not beyond the wit of Members to deal with those problems.
  It is important to put on record the fact that John Lewis Partnership is one of the organisations that really values its part-time employees. There are two large John Lewis Partnership stores in my constituency—the John Lewis store in Kingston and Waitrose in Surbiton—and I know some of the people who work in them. Indeed, they have written to me, as I shall explain later. They extol the way in which John Lewis Partnership implements its principles and core values to make sure that all employees are valued, whether they are full-time or part-time. Indeed, up to 30 per cent. of John Lewis Partnership employees are part-time and are integral to the company's strategy. It should be noted on the record that it treats them well.
  It is possible to get round the two problems mentioned by the hon. Member for Aylesbury. The partnership could undertake innovative work on liquidity to see whether it is possible to introduce a new concept of an internal capital market, and we should look at that. It is possible that in the past we did not spend enough time looking at how to improve the performance of mutuals and not-for-profit organisations. It is for Members of Parliament, given the public service reform ideas that are knocking around, which would involve greater use of the not-for-profit and mutual sector, to try to see how we can ensure that staff involved in such organisations can share in their prosperity and control.
  We may look to the external capital markets to see whether shares held by employees in such organisations can realise their value. External capital providers may be prepared to lend against the value of such shares. Clearly, they would have to take risk issues into account, but it may be possible to get round the problems that have been identified. We should certainly look at that in Committee.
  On the involvement of part-time employees, the hon. Member for Aylesbury expressed concern about the five-year period. We must remember that the Bill's key micro-economic purpose is to raise productivity. As such organisations will often value part-time employees and regard them as part of their longer-term strategy, we should not get rid of the five-year period. The productivity of part-time employees is just as important as the
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  productivity of full-time employees. We must remember that the Bill is not about giving a quick profit to employees or their making a fast buck; that is not the objective of tax relief. The objective of the Bill is to make sure that the interests and the vision of employees and employers come together, for the future benefit of the company and therefore of the economy.
  Mr. Love: I thank the hon. Gentleman for being so generous with his time. Surely one of the other reasons for maintaining the five-year time limit is to ensure that employee share ownership is not abused, as it was in the past, and converted to profit-related pay, which was discredited?
  Mr. Davey: I agree. The Bill is an anti-abuse measure, but it is more than that. It is important to remember that, in case there is a future lobby for the Government to get rid of the five-year period. We must ensure that the objectives of the tax relief are achieved. I do not think that the interests can be fused or productivity benefits such as reduced staff turnover can be achieved in a shorter period than five years. We may want to consider the time scale, but we should do so with great care.
  Mr. Lazarowicz: Does the hon. Gentleman agree that it is typical of many employee-owned companies that part-timers may stay for longer periods? That is traditional in many businesses that employ part-time workers.
  Mr. Davey: I am grateful to the hon. Gentleman for making that point. He is right. It is important that we do not set up false divides within the work force. We must remember that part-time employees play a crucial part in the economy. They should not be seen as necessarily moving in and out of the work force. They are permanent features of the work force.
  The second major provision clarifies the option of employee participation. As I said in my opening remarks, that is the key radical aspect of the Bill. The hon. Member for Edinburgh, North and Leith said that the Inland Revenue would provide guidance, and that in its view, the measure was not needed, as the current legislation was adequate. I suggest to the hon. Gentleman that he should stand fast in his belief that measures such as the Bill are needed.
  I am sure that the Inland Revenue will provide guidance and that its analysis is right, but it is important to provide greater clarity, transparency and awareness of the option. We need legislation that clearly encourages employer participation. In Committee, we can listen to the opinion of the Inland Revenue and consider other ways of providing clarity and ensuring that the current legislation and the options available are better known.
  If there are to be non-professional trustees, as the Bill suggests, it is important that companies give them proper training. The role of trustee carries significant responsibilities for the wealth of others. When companies go down that route, they should ensure that the trustees elected by their employees are suitably trained.
  The hon. Member for Aylesbury rightly mentioned the nature of the election, which is not specified in the Bill. I understand why the hon. Member for Edinburgh, North and Leith has chosen not to do so, as we could get involved in a huge argument. It is often better if

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  legislation is not over-specific. [Interruption.] The hon. Member for Edmonton, from a sedentary position, speaks of proportional representation. He is tempting me, but I shall not go down that avenue, as I could be here all night.
  Although I agree with the hon. Member for Edinburgh, North and Leith that the primary legislation should not be over-specific, I believe that in Committee we should explore the issues, as the hon. Member for Aylesbury suggested, because public money is involved. Also at issue is the reputation of the employee share ownership movement, and of the fairly radical measure proposed by the hon. Member for Edinburgh, North and Leith to get more active employee participation. It is such an important social and economic objective that we must get it right. We may need to be more specific than we would like, but that is no reason for objecting to Second Reading. It is a matter for full debate in Committee. As the hon. Member for Aylesbury observed, it is possible that it could be dealt with through secondary legislation.
  The third detailed measure in the Bill removes financial obstacles facing companies and provides financial relief if they choose to go down the route of employee share ownership. I welcome that. I do not know whether it originates with the right hon. and learned Member for Rushcliffe (Mr. Clarke). I am not familiar with the exact provision that he introduced. If it was introduced by him, that is not necessarily a poor source. The right hon. and learned Gentleman was responsible for some good measures.
  In the March 2001 Budget and in the 2001 pre-Budget report, the Government expressed interest in the matter. I shall be interested to hear from the Paymaster General when she sums up the debate tonight—[Interruption.] I meant this afternoon, as the Paymaster General reminds me. I am having a problem with timing. I hope that when she responds to the debate, she will say whether the measure is in line with the Government's thinking as it has developed since the 2001 Budget.
  I shall speak briefly about the John Lewis Partnership, primarily because, as I said earlier, it has two retail branches in my constituency. I have received letters from three constituents about the Bill. [Interruption.] The Paymaster General implores from a sedentary position that I do not read out the full letters. I will not, but I will read extracts. The support shown by constituents for the measure is one of the reasons that I will support it today.
  Mrs. G. Coleman of New Malden wrote, asking me to support the Bill. She made it clear that she wants the Government to go further. It is interesting that this letter and one or two others that I received are from employees of the John Lewis Partnership, who are not yet sure whether the legislation will apply to the company. If such doubts exist, we may need to ensure in Committee that the measure will apply to such firms.
  Mrs. Coleman wrote:
  "Long term as a partner in a business, I, as would my colleagues, want to see the Government take action to allow the staff of companies like the John Lewis Partnership to reap some of the benefits of ownership free of tax, in the same way as the staff of other major retail companies such as Tesco and Asda".
  That puts the point clearly. Successful companies such as the John Lewis Partnership, which are set up to encourage employee participation, should have the same tax benefits as others.
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  Mr. Will Sayer of Surbiton stated in his letter:
  "While I understand that there may be no direct benefit to my company or myself"—
  that illustrates the point that I made a moment ago—
  "I think this cause is worth championing as it recognises the values and principles of our kind of business and will help to give it a more public voice, which cannot be a bad thing."
  That is interesting. The employees of the John Lewis Partnership are very attached to the values and principles underlying that trust.
  Finally, Richard Bonner of Kingston, who is a councillor on the local John Lewis Partnership branch council, wrote:
  "I would like to see the Government take action to allow the staff of companies like mine to reap some of the benefits in the same way as employees of other retailers".
  Many people employed in that partnership are looking to the Government to support the idea and take it forward.
  In conclusion, I shall examine one or two of the alleged problems with the Bill and with the Government's plans. I dealt earlier with the five-year period and the matter of liquidity. Some people have argued that we are trying to get employees involved in risky investments. There is not a huge exposure in that regard, although there is, of course, a degree of risk. If people borrow against the assets or put some of their savings into buying them, a degree of risk will be involved, but it is not of the order of that which is associated with many other investments, especially as the Government have limits on the tax advantages of particular degrees of shareholding. The risks are reduced and are of a different order.
  Some people have complained about complexity and have suggested that we are using the tax system to promote particular types of behaviour. As somebody who believes that the tax system is massively over-complicated, I am concerned about making over-complicated tax legislation. The hon. Member for Aylesbury rightly referred to the compliance costs. We in this House are not good at introducing simple tax legislation that minimises such costs. When Whitehall writes its regulatory impact assessments, it is not very good at considering the compliance costs of tax, as it uses a questionable methodology in doing its sums. It always considers marginal change, but companies already have a set of accountants and tax advisers to consider that. Indeed, to the company, the change will be marginal, but we never stand back and consider the overall effects of the increasing complexity. Adding all the marginal changes together can demonstrate a huge increase in compliance costs.
  That is a serious issue. My approach to measures that add yet further complexity is to ask whether the benefits that will be achieved are really worth the costs. In respect of many of the Government's proposals, I do not think that such increases are worth the cost. The Government have tinkered with the tax system and have not justified the extra complexity to the House by demonstrating that it is worth the benefits that they maintain are achieved. However, as my previous remarks show, I do believe that there are such benefits in the type of legislation that is before us. I am completely convinced that the long-term growth, productivity and performance of UK plc will be significantly enhanced over time if we make the proposed improvement. In this case, I think that the extra complexity is justified, although perhaps complexity in

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  the administrative arrangements could be reduced. I am not sure whether we should lay that matter on the shoulders of the hon. Member for Edinburgh, North and Leith, but I think that the Paymaster General and her colleagues should consider how to reduce such complexity.
  I have not seen any of the commentary on the Bill, but I believe that we should mark up another issue as a potential concern. It relates to what the hon. Member for Aylesbury said about the overall costs of the measure, which I think will be relatively minimal in the early periods. The Paymaster General shakes her head. I hope that that does not mean that the Government are going to oppose the Bill, and that she will persuade us that we can, at least through negotiation, ensure that the costs are not preventive. Indeed, it is some of the Government's other measures—not only in respect of the proposed scheme, but elsewhere—that might mean that the costs become a problem later.
  Mr. Tom Harris: Will the hon. Gentleman comment on whether putting an extra 1p on income tax might be an appropriate way of meeting the costs?
  Mr. Davey: There have been some helpful interventions, but that was not one of them. For the record—Conservative Members are already getting in a bit of a tizz—I should say that the matter under discussion has nothing to do with that pledge, as the hon. Gentleman well knows.
  I was referring to the capital gains tax reforms that the Government have cack-handedly implemented over the past few years. They introduced 10-year, five-year and now two-year taper relief, which has implications. People who are remunerated in capital in relation to shares may be able to get capital gains tax benefit fairly quickly. The overall income tax base may well be reduced as changes are made to the way in which people are remunerated. Some people—I do not necessarily exclude myself from them—welcome some of the changes that the Government have made to capital gains tax, and especially those that tidy up some of the original mess. However, we need to take cognisance of these matters in the way in which we estimate the potential cost of the measures and try to find a way of taking the proposed route without undermining the health of the income tax system in the longer term.
  I should like to raise another issue that is relatively small, but is important to achieving the benefits that the hon. Member for Edinburgh, North and Leith seeks. The hon. Member for Arundel and South Downs (Mr. Flight) raised the issue with a Treasury Minister in relation to Government proposals that were originally made in the Finance Act 2000. He asked whether low-paid employees who were getting holidays or exemptions from national insurance contributions would lose the benefits because they were not paying the contributions. In an answer given on 19 July 2000 at column 399 of Hansard, a former Treasury Minister said that it would be up to individual employees to decide whether they got the benefits from the contributions, and whether or not to get national insurance relief but buy the shares, or to opt for the shares and tax exemption. That Minister was leaving it to individual employees and suggesting that they had the information on which to base that choice.
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  Will the Paymaster General go a bit further? Could there be some protection with regard to the contributory benefits? We have seen similar protection in other reforms that the Government have introduced in the national insurance system, so perhaps it could be provided in addition to the relief that is given to make the share purchase.
  It has been clear in this debate that there are some matters with which we shall need to deal in Committee. The hon. Member for Edinburgh, North and Leith is raising some tricky and complex issues. However, as we do that work, we must not lose sight of the fact that we should support the core of the proposals. I hope that the Government will indicate their support and that they will take a constructive attitude to the way in which we negotiate and amend the Bill in Committee.
  11.17 am
  Linda Gilroy: I take great pleasure in congratulating my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz), a fellow Labour and Co-operative Member, on his luck in the ballot and on his choice of this Bill, which sits very well with the range of issues in which we take a special interest as co-operators.
  My hon. Friend's Bill both widens and deepens existing provision for employee share ownership schemes. As has been shown in all parts of the House, there has been support for such change for many years and under Governments of all colours. Thankfully, the Bill apparently has cross-party support in principle, so I look forward to some of this morning's discussions being explored in more detail later.
  The Bill widens existing provisions by making more companies eligible for tax reliefs in relation to any move that they may be considering to distribute shares to employees. It thereby makes that distribution more likely to happen and stands a strong chance of extending employee share ownership to many more people. It also widens existing provisions, enabling companies that are controlled by employees to benefit from tax advantages by setting up share incentive plans. It also deepens the provisions, especially through clause 1(5). I noted that my hon. Friend the Member for Edinburgh, North and Leith said in his opening remarks that people had asked whether the provision was necessary. I believe that it encourages companies to provide for the appointment of employee-elected trustees when drawing up a trust instrument. That should be welcome, for several reasons that I shall outline.
  The Bill ensures that employee share ownership schemes will progressively be for the many, not the few, to use a well known phrase. My hon. Friend cited some significant figures to show what employee share ownership means for the prosperity of companies as measured through growth in share value.
  The measure builds on the Budget provisions of 2000 and 2001 and should increase the number of employees that have access to such schemes. It contributes to the quality and the added value that arise from employee share ownership schemes. It also builds on what Paul Burden, communications director of the John Lewis Partnership, described to me as increasing the economic biodiversity of ownership. It also introduces greater choice in forms of ownership.

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  It is generally agreed that employee share ownership schemes are good for companies, employees and the economy. They are good for companies in many ways. For example, employee share ownership can improve retention; some argue that it also improves recruitment. Through reducing staff turnover, it can lower the company's costs and lead to the productivity that other hon. Members have mentioned this morning. That is an important goal, which creates competitiveness.
  Employee share ownership is also good for companies because it allows them to draw directly on employees' special experience. That is especially beneficial to companies that need to progress through research and development and get their choices right in the first instance.
  Employee share ownership leads to more commitment, which is especially important when, from time to time, the going gets tough for companies. Employees who are share owners tend to become more aware of any difficulties that face companies earlier, and contribute to heading off problems and tackling them constructively.
  The financial stake rewards the employees if the company is doing well. Employee share ownership therefore builds a virtuous circle of commitment. Employees often feel put upon if others benefit from their hard work. When the going gets tough, such schemes give employees a greater sense of influence and control. There is nothing worse than feeling that one has no say or control when things are going wrong, especially when one can contribute skills that make it more likely that a company will pull through.
  Employee share ownership is also good for the country. I am sure that many hon. Members agree that we need to encourage long-termism. Such schemes are a way of doing that. "Employees Direct" is a document that comes from a new publishing stable, Mutuo, which belongs to Communicate Mutuality. It is a partnership between organisations that wish to show the value and potential of the mutual sector to a Modern society. In the foreword to the document, John Monks states:
  "the shareholder voice of employees could prove a powerful counterweight to the short-term horizons of other investors and create the conditions necessary for stable workplace partnerships to flourish."
  The document explores some methods of achieving that. I recommend it to the many hon. Members who are interested in the subject.
  Employee share ownership encourages growth. Some argue that it has even wider benefits, such as social cohesion and regeneration. Earlier, some hon. Members suggested that it might anchor footloose companies. I am not sure whether those claims stand up to scrutiny, but research in Italy shows that full employee ownership has wider social effects in the towns where it exist. The benefits include improvements to education and health, reduced crime and greater social participation. The schemes have also affected people's perceptions of their social environment.
  Earlier exchanges between my hon. Friends the Members for Cleethorpes (Shona McIsaac) and for Edmonton (Mr. Love) and the hon. Member for Aylesbury (Mr. Lidington) dwelt on the importance of employee share ownership in the United States. Much of the research has been carried out there because the schemes are better developed. Recent research shows that
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  employee share ownership in the United States spreads wealth and enables employees to weather periods of unemployment. It thus makes a wider contribution to preventing poverty, including child poverty. Recent research has also shown that companies in which all employees have shares enjoy 50 per cent. more productivity than companies in which only senior employees have shares.
  The Bill will open up more opportunities for employee share ownership. It will add to eligibility a small but important sector of employees and encourage owners to transfer to employees. It will help to obtain maximum added value, which arises from such schemes by providing for employees to be more involved in managing trusts that hold shares for their benefit, and by giving employees a significant say in the company's development.
  In the best tradition of private Members' Bills, the measure is a win-win Bill, as my hon. Friend the Member for West Bromwich, West (Mr. Bailey) said. The employees, the companies and the country will win. Companies will win when the going is good and a winning outcome is more likely to result when the going gets tough. I support the Bill, wish it a fair wind and hope that it returns to the Chamber in its final form.
  11.28 am
  Mr. Richard Bacon: I shall be brief. I want to make two or three points, if I can remove the frog from my throat. It has become fashionable in my party to have a frog in the throat, and I am trying to adopt the style of the Front Bench. I shall also try to make myself understood.
  Many constituents have written to me about employee share ownership, including eight partners in the John Lewis Partnership. I am delighted to support the Bill. The John Lewis Partnership has several excellent stores in my area, including Bonds, a department store in Norwich, and two branches of Waitrose, one of which is in my constituency. They provide a superb service to local people in Norfolk as well as employment for several hundred people.
  Mr. Joe Mooney, one of my constituents who is a partner in the John Lewis Partnership, wrote:
  "I believe the John Lewis Partnership is a successful retailer because it is owned by its employees, who care about the development of their business today and for future generations.
  The Bill"—
  which he has asked me to support—
  "is seeking not only to make it easier for companies to become employee-owned, but also to improve the position of existing employee-owned companies. These improvements will include tax exemptions on shares given to employees by their company."
  It seems odd that companies such as Asda and Tesco-competitors of the John Lewis Partnership—are able to take advantage of those tax exemptions in helping their employees, while good firms such as the John Lewis Partnership are not. Hon. Members on both sides of the House have referred to the John Lewis brief, and asked whether it would be possible in practice for the company to provide liquidity to an internal market for the shares. I think that, with 55,000 employees across the country, that ought to be possible.
  The hon. Member for Kingston and Surbiton (Mr. Davey), who is no longer in his place—I dare say he has gone off to write his press release, or to find another

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  use for the 1p—made the point that part-time employees can play a long-term role in a company. I think that that is right, and there is no reason why these problems should not be sorted out in Committee. We ought all to unite in supporting the principle in the Bill of wider employee share ownership.
  I confess to having a lot of sympathy with the criticisms made of the actions of my party in the 1980s in introducing schemes that benefited only some, rather than all, employees. Manifestly, something that is introduced because it is of benefit to certain classes of employee ought, by its very nature, to be available to all employees. The former head of the Prime Minister's policy unit looks as though he wishes to intervene. I give way to him.
  Mr. David Miliband: Does the hon. Gentleman share my pleasure in an example of a change of attitude in South Shields? It exemplifies the shift that he has talked about, from rewarding only those at the top of the company to rewarding everyone throughout. For 11 weeks last autumn, a major employer in my constituency was in receivership. During that time, a management buy-out team was brought together and I am delighted to say that in December a new company, Circatex, was launched. The first thing that the new management did was to introduce a 30 per cent. employee share ownership scheme for the new company, as a way of showing their commitment to the employees and saying that they were there for the long term. They wanted to reward the employees, many of whom had been with the company for 10 or 20 years, and make them part of the company's future. Does the hon. Gentleman hope, as I do, that that represents a change of attitude for significant parts of British management, as well as for those in the House?
  Mr. Bacon: I agree with the hon. Gentleman that that is representative of the change in attitude. In fact, there has been a sea change in attitudes generally. I enjoyed what I might almost call the Thatcherite speech by the hon. Member for West Bromwich, West (Mr. Bailey). I used to go to West Bromwich as a small boy to watch its football team; it did not seem to be a bastion of Thatcherism in the late 70s. In fact, I joined the Conservative party because of Red Robbo, whom I am sure the hon. Gentleman remembers well.
  There has been a change in attitudes, and that is most welcome. It is extraordinary that anyone should suppose that these incentives would not be sought by all kinds of employees, and I am very pleased to support the principle of the Bill. We have nothing to fear from diverse forms of capital ownership. That could mean ordinary shareholding in the traditional western capitalist sense. I am delighted to see my hon. Friend the Member for Cities of London and Westminster (Mr. Field) here in full battle dress.
  Mr. Mark Field: I think the full battle dress will appear after lunch. My hon. Friend will be glad to know that my luncheon activities are being catered for. May I also say that I very much agree with the Bill? It seems that the John Lewis
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  Partnership's employees around the country have been lobbying us all furiously, because I, too, have had at least half a dozen letters from a similar source.
  Mr. Bacon: I have noticed that, any time after about 4 o'clock, the likelihood is that I shall find my hon. Friend in a dinner jacket, limbering up for his evening activities, usually with the King of Jordan or somebody like that. The rest of us have to slum it in the Terrace caff.
  We have nothing to fear from diverse forms of capital ownership. That could mean ordinary share owning, co-operatives, employee trusts or mutuals. I acted for a mutual building society for some months; I was seconded to it three days a week. Hon. Members may remember when the Britannia building society faced a most unwelcome challenge from a demutualisation campaign. If anyone doubts the benefits of what is sometimes described as the nebulous trade known as public relations, I would refer them to the photographs that occasionally appeared in the tabloid newspapers of that mad butler, Mr. Michael Hardern, wearing a dress, under the rather suggestive headline:
  "This is the nutter who wants to run your savings."
  That alone justifies the existence of the public relations industry, because that campaign helped to ensure that the Britannia, now the nation's second largest building society, thrives to this day as a conscientious local employer in regions across the country, and one that takes great pride in being involved in the community.
  Reference was made earlier to the business of profit-related pay, and to its being discredited. I have not examined the issue in detail, but it would not surprise me if it had not worked as well as it was supposed to because, in a funny sort of way, this question is not mainly about money. Money is obviously important, but this is mainly about people having control over their own lives. The hon. Member for South Shields (Mr. Miliband) referred to the company in his constituency. In a previous incarnation, I used to write about management buy-outs and management consultants helping companies that were on the brink to climb out of that position. Nearly always, the solution involved drawing in the entire work force and making them work with one purpose towards success.
  Mr. Love: Does the hon. Gentleman agree that we will really have seen the revolution that people have been talking about today when companies that are not on the brink of bankruptcy or in financial difficulties involve their employees, without the spur that bankruptcy provides?
  Mr. Bacon: I could not agree more with the hon. Gentleman. I find it difficult to understand why managers would ever think of introducing an executive share option scheme that would be available only to them and those close to them, and not to everyone else. The Government should seriously consider ways of making it more beneficial for companies to have schemes that involve everyone, rather than involving only some employees. I would be strongly in favour of that. The principle of employee share ownership deserves the widest support on both sides of the House, and the Bill definitely deserves a Second Reading.
  11.37 am
  Dr. Doug Naysmith: I congratulate my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz) on his success in the private Members' ballot, and on choosing such a worthwhile and achievable topic for his Bill, which he introduced so clearly today.
  We have already heard a lot about partnership—not just the John Lewis Partnership—sometimes from unusual sources, which is to be welcomed. I want to expand on the principle of partnership between the work force in general, through employee trusts and shareholder trusts, and board members of the company. Partnership clearly pays. Companies that tap into the skills, knowledge, commitment and enthusiasm of their work force are the better for it. We have heard examples of that already. Innovation and productivity are positively related to a partnership approach, in which the work force can influence strategic decisions and individuals have more control over the immediate decisions in the company that affect them.
  That is increasingly true as our economy becomes ever more knowledge-based and skills-driven. Companies that fail fully to harness their work force's potential will lose out in the future. Those that forge successful workplace partnerships will gain an important competitive advantage. For a partnership to deliver, however, it must be genuine; anything less will lead to disillusionment and resentment. Structures are required to ensure that such partnerships are demonstrably real and equal. Although we have heard discussions today about what that should mean, and whether the detail should be spelled out now, that area can be fruitfully explored when the Bill gets into Committee, as I believe it will.
  Collective ownership stakes for employees could play an important role in the achievement of that. Collective shareholder trusts could signify a shared interest in the long-term success of organisations, while providing a collective voice at boardroom level for members of such trusts—the employees who generate companies' wealth. The shareholder voice of employees could provide a powerful counterweight to the short-term horizons of other investors, and create the conditions that are necessary for stable workplace partnerships to flourish.
  It is widely acknowledged that business in Britain faces two major challenges. The first is this. Successive commissions and reports have sought to improve the structure of corporate governance—the way in which boards of directors operate and conduct their business, the way in which they respond to wider concerns including the environmental impact of their companies' operations, their responsibilities to the communities in which their companies operate, and so forth. The combined code on corporate governance that resulted from those deliberations is useful, although many of us would like the standards to be given a statutory basis.
  One of the main problems identified by the inquiries is the inadequate involvement of the chief shareholders, the financial institutions. It is important for shareholders to take a long-term interest in their investments. Employee shareholder trusts could achieve precisely that, and could encourage institutional shareholders to do the same. Creating employee shareholder trusts, and encouraging employee shareholders to play an active role in their companies, could go a long way towards improving the corporate governance of United Kingdom firms.
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  This is the second challenge. The Government have stressed the importance of boosting productivity in UK firms. They have rightly recognised that the key to that will be the commitment and participation of the work force, and they have accepted the view that, developed in the context of partnership, employee share ownership can produce significant productivity gains. The task now is to push at the margins of Government policy and to encourage workers, through their representatives, to use the power of their equity stakes to influence corporate decisions.
  I welcome the proposals, although encouraging employee shareholders to play an active role will not be an easy task. Advice and training will be needed for those who will take positions of responsibility in trust organisations. I understand that the Trades Union Congress has established a working party to deal with the details: it will include representatives of the TUC and the Confederation of British Industry, as well as the chief executive of the Co-operative Union, leading academics and others. The results, along with the outcome of the Government's company law reform review, could lay the foundations for a transformation of corporate governance. Such an achievement would be a landmark for Labour's second term.
  The major proposals in the Bill fit into this ferment of ideas well, which is my reason for supporting it.
  11.43 am
  Mr. Jonathan Djanogly: Like my hon. Friends who have spoken, I broadly support the Bill's intentions. My hon. Friend the Member for Aylesbury (Mr. Lidington) analysed the proposals carefully, and I agreed with what he said. I shall therefore try to put the Bill's aims into the wider context of share incentivisation rather than pursuing my hon. Friend's remarks.
  The Bill tweaks existing legislation, rather than requiring us to take a good look at existing incentivisation law. It merely skims the surface: while it is not harmful in any way, it is not adequate. We need to look more closely at the underlying share incentivisation legislation, and at its current limitations.
  Many of the issues are very technical, but we should realise that the underlying assumptions are not. Giving employees shares in their companies is a desirable objective. It is good for employees to have an increasing say in the running of their companies, and for them to see a direct link between their own increases in productivity and the companies' success—a link which, as was noted by the hon. Member for Kingston and Surbiton (Mr. Davey), breaks down the "them and us" culture that has plagued our business sector in past years.
  The increased productivity of workers, and even the increased profitability of companies, may not increase the value of shares; but that is simply the reality of the market mechanism. Employees should recognise that the value of their shares can be affected by outside events: the impact of the disastrous events of 11 September on the tourism industry is a good example. Such a recognition is useful in bringing together management and employees in a better realisation of the overall market position of their companies.
  Having said that, I must add that the hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) assumes that the widening of share ownership is best achieved by

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  a company's issuing shares to employees rather than granting share options. That may be right in certain circumstances, but not in others. It depends on the type of incentivisation required, the level of the employees, and the expectations relating to comparable incentivisation schemes in similar sectors. In high-tech companies, for instance, there will almost invariably be a high use of share options, because that is what employees in such industries will expect. Problems would arise if they were told that they should have something else.
  Members have referred to what should be deemed an acceptable time for shares to be held before tax advantages are gained. That, I think, will depend on the circumstances. In certain industries a large investment will be made in a company, and employees will be expected to work at least 20 hours a day over a short period. Their vision of when they will produce their product, and of the benefits that will result in their pay packets or incentivisation schemes, must be moulded accordingly. The key to understanding incentivisation is realising that there is no such thing as "one size fits all"; the situation can be much more complicated.
  Share options are often more popular with employees who, with relatively limited resources, find the gearing effect relatively attractive. Having exercised their options most people sell immediately, thus incurring no capital outlay. That greatly reduces the risks that they would otherwise incur from buying shares and then having their capital locked in an asset for five years, subject to the possibility of a fall in value.
  For a company, the advantage of an immediate purchase of shares is that it will receive the additional share capital on the spot. Most companies, however, are started by entrepreneurs with perhaps one original investor—up to six, but rarely more. In practice, those individuals will certainly take up tax breaks offered by Government, but they will seldom wish to hand out cheap equity to low-paid staff from day one. Most entrepreneurs will see the low investment cost as the benefit of their having taken the risk of setting up the company and running it in the early days.
  I understand from my hon. Friend the Member for Aylesbury that some 200 SIP schemes have now been approved, and that half of them were established in firms with fewer than 250 employees. It would be interesting, however, to find out how many of the schemes were set up within a year of a company's incorporation, and how many companies had issued SIP shares to people other than the founding shareholders.
  Mr. Mark Field: I congratulate my hon. Friend on a thoughtful speech. As he rightly pointed out, the matter is technical, and he has succeeded in putting it in straightforward and simple terms. Does he think that certain share schemes may prevent the setting up of new companies? If a strong scheme is already in place, it may act as a powerful disincentive to would-be entrepreneurs employed in small companies, thus preventing them from breaking out on their own.
  Mr. Djanogly: I thank my hon. Friend for his intervention. He is developing an argument that I was about to make. If he cares to intervene later, I shall be
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  happy to hear what he has to say. In reality, few start-up companies would want such a scheme. The SIP concept is likely to be attractive to established smaller companies and also to larger companies that often do not want to administer large numbers of small share options.
  SIPs may have an additional advantage for listed companies, especially when we consider the alternative investment market. Such companies are often larger—although by no means always. The Association of British Insurers has published guidelines on the issue of share options. The guidelines are many and complicated but, put simply, companies cannot hold more than 10 per cent. of their issued share capital subject to option. That means that companies have a limited number of options to issue. In general, the smaller the company, the less its headroom as regards the number of options.
  Companies may use SIPs to incentivise lower-paid employees, rather than use up their precious packages of share options. They may want to retain those options to incentivise higher-paid employees, and in practice they often do so. However, that does not necessarily mean that the company is doing the right thing. While SIPs may to some degree increase share ownership, because they offer companies a further route through the maze of tax laws and other regulations and guidelines, none the less they are not necessarily the most appropriate form of incentivisation, from the perspective of either the company or the employee.
  Profit-related pay has been mentioned. Bonuses are an important part of the armoury of incentivisation, but it is not always appropriate to hand out equity. I fully support that practice, but in certain circumstances it may be more appropriate to use bonuses. I am sure that all hon. Members appreciate that workers in many industries, especially the low paid, would prefer cash bonuses rather than the choice of receiving shares. In certain circumstances, that may be appropriate. I still fail to see why the Government abolished the PRP scheme because—
  The Paymaster General (Dawn Primarolo): I am listening carefully to the hon. Gentleman's speech, but I must correct him on one point. It was the Conservative Government who abolished profit-related pay. PRP was phased out over a number of years, after the election of the Labour Government in 1997; but it was actually abolished by the Conservatives because of the huge problems in the scheme—not least its cost, which rose to £1.5 billion.
  Mr. Djanogly: The scheme was phased out, and that was contentious at the time. One important arm in the ability of companies to decide how to remunerate their employees was taken away. Cost may indeed have been highly relevant to Her Majesty's Treasury at the time, but that does not mean that the principle was wrong and that the Government should not be encouraged to reconsider such measures as a means of incentivisation.
  The measure will open up the SIP regime to a wider base, such as trust-based companies. That is certainly to be commended. However, the measure will not improve the underlying weaknesses of the SIP regime. As I have tried to argue, the regime is unlikely to help starting-up companies, or indeed middle-ranking companies.
  The briefing notes for the Bill state that many firms, especially small family-owned ones, are eventually handed over to their employees, and that the changes to

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  corporation tax under the Bill will make it possible for more businesses to be transferred into employee ownership. That may be true in certain cases, especially for extremely small companies, but normally the company purchases are carried out by a small number of managers rather than the staff as a whole—so-called management buy-outs. In such circumstances, the £7,500-worth of shares that have the benefit of SIP status are likely to be negligible in the context of the transaction as a whole.
  I very much doubt whether the impact of the Bill will enable employee buy-outs—one of its intended effects—other than for tiny companies or, occasionally, large transfers where enormous administrative problems would have to be overcome.
  Mr. Edward Davey: I do not understand the point that the hon. Gentleman is making. The management buy-outs that he describes happen anyway. The point of giving tax relief is to encourage behaviour that would not otherwise happen. My understanding of the Government SIP scheme and the Bill is that they would encourage something that would not happen otherwise.
  Mr. Djanogly: The hon. Gentleman makes an interesting point. The rationale for the Bill can be considered at various levels. On the one hand, it is a straightforward attempt to encourage employees to become interested in their company, but as we can see from the briefing notes the measure would also provide that SIPs could be used as a another mechanism to promote activities such as employee buy-outs. I am simply saying that that is unlikely to be the case, and that the real benefits of the Bill are likely to be more modest than several hon. Members have implied. Of course, that does not mean that the Bill is worthless.
  Mr. Gareth R. Thomas: The hon. Gentleman is making a distinctive contribution, focusing on many of the technical issues that form a background to the Bill. He spoke about the rationale for introducing the Bill and said that there were several different levels. Has he been influenced by the most basic form of rationale for legislation: the fact that his constituents want the Bill? Would he join me and other Members of Parliament who have been lobbied by employees of the John Lewis organisation in congratulating them on the effectiveness of their lobbying operation?
  Mr. Djanogly: I certainly would congratulate John Lewis on that lobbying operation. John Lewis does not have a base in my constituency, but it does close by. As I said, the larger organisations such as John Lewis could enjoy real benefits from legislation such as the Bill because it would give them another way of incentivising their employees. To that extent, I welcome the principle of the Bill.
  However, it is important to appreciate that—probably because of the limitations of the underlying legislation—the Government wisely decided not to abolish previous share incentivisation plans, such as the save-as-you-earn share option scheme and the company share option plans. Although they were by no means perfect, they at least—together with the Government's new enterprise management incentive scheme—make available a wider package for tax-advantageous share ownership and
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  incentivisation. However, there remain significant problems with all those schemes, which we need to get right. There is still much to do.
  The business of a company may not qualify to be included. The company may not be independent—I appreciate that, in a limited context, the Bill identifies that as an issue to be dealt with for certain companies—or its assets may be too great. In practice, there will be many occasions on which, and many different reasons why, a company cannot tick all the boxes that it needs to tick to set up a particular incentivisation plan.
  In such situations, the company will need to fall back on the so-called unapproved issue of shares or unapproved grant of options—in other words, schemes that do not have tax benefits. In such circumstances, once the top layer of the schemes is removed, the picture changes somewhat to reveal a system that is extremely complicated and often unfair to company and employees, and in which the tax payable has been substantially increased by the Labour Government.
  If the Bill is truly to improve share ownership and encourage the setting up of new companies and the incentivisation of employees who wish to purchase their own company, I would suggest that three issues in particular need to be covered. The first concerns listed companies whose shares have fallen substantially. Many, if not all of their share options will be "under water"—the exercise price of the shares will be greater than the price at which they are currently quoted. Many such companies, which are particularly predominant in the technology sector, will have issued share options up to the maximum permitted level of 10 per cent. of their issued share capital. As a result, many dozens of companies are negatively incentivised. I would suggest that, in such circumstances, it be made easier for companies to terminate existing options and re-issue at the lower current market price.
  Mr. Davey: The hon. Gentleman has just put forward an interesting idea. What does he think the impact of his proposal would be on the nature of risk-taking associated with employee share ownership?
  Mr. Djanogly: The nature of risk-taking is not relevant because the individual can decide not to exercise those options, so there is no risk for the employee; there is simply no incentivisation in so far as he will not exercise those options. If one wished to incentivise employees who are in that position, one would need to cancel the existing options and re-issue new ones. If a company has had a very high share price and the market collapses, as the technology market did, employees may well have share options at a strike price that is so far ahead of the market price that they are negatively incentivised rather than incentivised by having those share options.
  Mr. Davey: Will the hon. Gentleman give way?
  Mr. Djanogly: I feel that that issue needs to be addressed, but I shall move on if the hon. Gentleman does not mind.
  I have a second suggestion for improving the Bill. Since April 1999, national insurance has been charged to companies on gains arising from the exercise of unapproved options. That has been nothing more than a

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  staff tax. In practice, companies have been amending their documentation to say that they can get the employees to pay the extra tax on their behalf, but it is conceptually wrong that a company has to pay national insurance on the open-ended growth of the value of its own shares. Finally, where a company agrees to deliver shares and those shares are forfeitable due to performance conditions—resembling an SIP but without the tax breaks—the gain becomes taxed on the value of those shares at the point when they become non-forfeitable. As with the options, the gain would be unascertainable on grant, but worse than with options, the company could not recover national insurance from its employees. Clearly, the position should be aligned with share options or, better still, national insurance on the growth in value should be abolished.
  The reference to the United States by the hon. Member for Edmonton (Mr. Love) reminds me that employees there have the opportunity to choose whether to pay up front or later, and we could do much by adopting the same position. I conclude by repeating that the measures that we are debating today will do no bad at all and some good, but they will tinker at the edges of the issue and fail to get to the heart of the problem.
  12.5 pm
  Ms Meg Munn: I am delighted that the House is giving such serious consideration to the Bill and that it has received support from hon. Members on both sides of the House. As a member of the Labour and Co-operative parties, and as a representative of those parties in Parliament, it is interesting to hear the issues and values that my hon. Friends and I stand for being discussed.
  The Bill would make three significant changes to the law to encourage wider employee share ownership, by improving representation for employees with shares and changing corporation tax and tax reliefs. My hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz) explained those aspects of the Bill in detail, and in supporting it I wish to focus more on the positive aspects of employee shareholding and to say why I believe that it is particularly positive for individuals, companies and societies.
  In doing so, I hope to provide a balance to the speech made by hon. Friend the Member for Huntingdon (Mr. Djanogly). Although he went into a great deal of technicality, he seems to have considered this issue as merely a matter of money, bonuses and incentives, whereas I believe that it is much more fundamental to the way in which we run companies and people operate in this society.
  Employee share ownership is about enriching the experience of working life. After all, people spend a lot of time at work—some of us more than others. One of the key factors in having a positive experience of work is how much we feel in control of our own lives. The people who suffer the most stress in their working lives are often those at the bottom of the pile—those who do the jobs that keep the rest of us going, but who have very little say in what goes on.
  When I became a Member of Parliament I noticed that there was something a little different from my previous occupations and the other workplaces of which I am
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  aware. It is certainly not unusual elsewhere for people to look for opportunities to take early retirement. Interestingly enough, that does not seem to be true of Members of Parliament. Many Members continue to make valuable contributions and to enjoy this job long beyond the usual age of retirement. I pondered why that is so and wondered whether it is because of the convenient working hours and the fact that we are often so close to home and that we have our own place on the Benches and never have to fight to sit down, or because of the supportive and friendly atmosphere in which no one ever criticises us, looks for our mistakes or writes to the papers about the worst way in which we have put our foot in it recently—which I am probably doing at the moment.
  Many people get so much job satisfaction from being a Member of Parliament because they can largely control what they do with their time; they are self-directed—Whips permitting, obviously. They can decide to concentrate on various subjects and to pursue particular interests. They feel that they are making a contribution and doing something worth while. That sense of job satisfaction and having control and a stake in what happens is crucial to employee share ownership.
  The first benefit of employee share ownership is that it encourages an active participation in decision making. Employees are not always on the receiving end of decisions that other people have made and that seem to have no relevance to the employees or to the company for which they work. That taps into the motivation of employees and gets back from them a level of commitment.
  Employee share ownership also helps to enable work to be designed to encourage the fullest contribution from employees. If they want their companies to do well, they are more committed to using all their skills and abilities and to becoming more fully involved in what the company is trying to do. That also ensures and enhances the competence of the employees, as they become committed to taking up training opportunities and to pooling their knowledge and abilities for the best of all concerned.
  The Bill is welcome because it would improve the current situation. Importantly, it would seek to democratise share owning in UK companies. It is about introducing mechanisms to translate individual employee shareholding stakes into a collective voice, making sure that those interests are represented and convincing employees that their shareholdings can give them a stake in the whole enterprise.
  I particularly welcomed the contribution of the hon. Member for Aylesbury (Mr. Lidington), who recognised that employee share ownership enables individuals to build up capital. This country has a problem with savings and we know that sectors of the population have no capital to provide for their families in the long run. Although the Bill might make only a minor contribution to solving that problem and might affect only a few people, the issue should not be ignored.
  Other Members have made it clear that employees who feel that they have a stake in their workplace are more likely to be committed to their jobs, to stay longer in the company and to become valuable members of a team. That will lead to a company's longer-term prosperity and, as other Members have eloquently pointed out, research shows that employee share ownership often boosts productivity.

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  Companies face difficult issues of corporate governance and in ensuring that things are done properly. When stakeholders take a long-term interest in their investments, that is more likely to lead to good corporate governance and to good outcomes for companies. Employee shareholder trusts are an excellent way of encouraging just that. The employees involved have a long-term interest in the company and in their own future. It is a win-win situation.
  If employees can participate in decisions and are not merely the recipients of shares, share options or bonuses in the way that the hon. Member for Huntingdon suggested, that will help to generate and sustain company loyalty and commitment to the organisation. It helps to combat the long-term British disease of short termism. We need companies that will be successful in the long term and, in a rapidly changing world, innovation is important. Employees who are involved in their companies are able to contribute to decisions about what is produced and about the processes used in production.
  As my hon. Friend the Member for Edinburgh, North and Leith said, the Bill would broaden the definitions involved to cover more employee participation companies. It must be right that the tax benefits available to companies under existing schemes should be spread to those organisations whose fundamental purpose is to include employees in their running. They include worker co-operatives, in particular, and the Bill represents a step forward in recognising that companies, such as the John Lewis Partnership, about which we have heard a great deal, should receive the same benefits and opportunities as other employee shareholding arrangements receive.
  Employee share schemes also raise issues for society in general. Does it matter who owns companies? My hon. Friend the Member for West Bromwich, West (Mr. Bailey) talked about the distinct views that were expressed on that a few decades ago, and employee share schemes might be a different approach—a third way, perhaps. However, it is a case not of public or private ownership, but of recognising that our society benefits from different ownership structures. There are different ways to produce profits and to reward employees. Those different structures add to the richness of our society and the proposals will help us to consider new ways to operate that will also improve efficiency, which we all want.
  Hon. Members mentioned what happened a few years ago when many financial mutuals converted to plcs, which was resisted by those of us with a strong interest in mutuality. Anything that encourages people to become involved in companies again is welcome because it allows us to have a more balanced society. Such an approach allows us to recognise the contributions of individuals and the fact that people who work together often achieve more than people who work against each other.
  Unfortunately, with private ownership shareholders' interests often come first. The benefits of being responsive to the interests of employees, consumers and local communities is often forgotten. There is the opportunity, in companies in which employees have a much greater involvement, to raise such issues and put them higher on the agenda, ensuring that the long-term interests of the enterprise are promoted, but not at the expense of the interests of those other important stakeholders.
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  Society is changing and the economy is much more skills driven and knowledge based. We know that those attributes come from employees and that it is not possible to go out and buy those skills as part of a mechanistic process. It must be a good thing if we ensure that people who have that knowledge and those skills are involved in a company and committed to it.
  We must welcome the fact that the Government have promoted employee share ownership, as reflected in previous Budgets. However, the Bill would tidy up some of those provisions and take us significantly further forward. Hon. Members demonstrated how extending employee share ownership can benefit individuals, companies and the wider society. We have discussed whether the Bill would bring about huge changes in society. Are the proposals radical or just minor tinkerings that will not do what people expect? We need to make it clear that the model is optional. People can choose it and it is important that the Government encourage them to do so. For those who see the potential of encouraging active employee participation, the Bill will be an improvement. It will clear up anomalies that penalise those organisations that are at the forefront of involving their employees.
  I conclude by congratulating my hon. Friend the Member for Edinburgh, North and Leith on introducing the Bill. I am especially delighted, as I am sure he is, with the cross-party support that it has received.
  12.19 pm
  John Barrett: I start where the hon. Member for Sheffield, Heeley (Ms Munn) left off by congratulating the hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) on giving us the opportunity to debate the subject. The Bill is a move in the right direction and, as my hon. Friend the Member for Kingston and Surbiton (Mr. Davey) said when he set out in detail our approach, we welcome it.
  Involvement in a company is a key that can open the door to a new way of working—a door that should be open to as many people as possible. For many people, the weekly pay packet or monthly salary is what work is all about. They have no involvement, no commitment and no responsibility for the future growth of the company, never feeling part of its decision making, which affects a large part of everyday life.
  One of the facts of business life is that productivity must constantly be improved in order to survive. More efficient methods must be implemented or competitors will win the day. Often, innovation, team working and efficiency were driven by a very small team from the top down—by those who thought they knew best. That is no longer good enough. Companies must maintain the involvement of all employees.
  Employees who have a shareholding in their company are more likely to want to develop an understanding of how the company works and to be involved in its progress and success. They are less likely to leave it to someone else to act when problems are identified that affect the company's strength. Hon. Members have mentioned unjustified absenteeism. When employees are involved strongly with their company, that is less likely to be a problem.
  For 20 years, before being elected to this place, I was fortunate to have a stake in my place of work. I have worked with many who have owned all or part of a

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  company, held shares in companies, or wanted to have a stake in a company but have had no stake in it. There is a clear correlation between increased involvement in a company and the drive needed to make the company succeed.
  Anything that moves legislation in that direction must be welcomed. It will affect the lives of many people in a number of ways. The hon. Member for Plymouth, Sutton (Linda Gilroy) mentioned an Italian study that showed that increased company involvement resulted in improved health, education, lower crime rates and social participation. I look forward to studies of whether such involvement has the same results here.
  When morale is declining in any company, the disfranchised feel that there is little they can do. Many lose interest and spend more time looking for another job than considering the well-being of their company. Work problems lead to health problems and health problems have an educational impact.
  In recent years, the detachment of many employees from their companies has increased with the use of short-term employment contracts. In the past, often the assumption was that the job would last unless something unexpected happened. Nowadays, often the assumption is that the contract will end unless something unexpected happens. The result is reduced company loyalty, a work force on the move, and less commitment to a company. There is a short-term outlook in many companies and among employees, which is a major problem for British industry. If, as I believe it will, the Bill facilitates more involvement by more employees in more companies, people will be inclined to look long term. As many hon. Members have said, it is a win-win situation.
  Share ownership is not suitable for all, as was mentioned earlier in comparing it with house ownership. Many who have bought homes have done very well. Indeed, in Edinburgh today, many people could not afford to move into their own homes at current prices, but buying a home brings costs and responsibilities for which people may not be prepared. The value of any investment can go down as well as up. There will always be people who want no more from their employer than a weekly pay packet. However, those who do want to play a part should be encouraged and enabled to do so. The Bill enables something that is not possible at present. There was possibly one negative contribution, but I was glad to hear positive speeches and interventions from hon. Members on both sides of the House. I hope that the Bill will go to Committee and be a great success.
  Mr. Love: Does the hon. Gentleman accept that a significant number of employees who may be sceptical at the start of such a share ownership scheme become mobilised by the increase in their influence and the return that they receive from share ownership?
  John Barrett: I could not agree more. Many employees think that share ownership is for other people, not for the likes of them. People will have to embark on a learning curve: once they discover the benefits that they, their company and their family can gain, the system will gain momentum. I wish the Bill success and look forward to Committee.
  12.25 pm
  Mr. Iain Luke: I am glad to be able to make a contribution to this worthy debate on the private Member's Bill promoted by my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz). I congratulate him on his success in the ballot.
  I am well placed to pay tribute to my hon. Friend's commitment, having known him for 20 years. We first met at Edinburgh university, where I was studying for a post-graduate qualification in business administration, majoring in industrial relations. My first chance to enter an electoral contest was in the regional division of the then Lothian region, in Newtown-Stockbridge. I believe that it was my strong showing in that election that turned the corner for Labour in what had been an extremely Conservative part of Edinburgh, resulting in my hon. Friend's being returned as Labour MP at the last election and so getting the chance to introduce this Bill. We both served as leader of our respective city administrations, and we share an office in Millbank. In the light of all that, I am in a good position to comment on his collaborative and co-operative efforts.
  Throughout that time, my hon. Friend has shown a strong commitment to the co-operative movement, which has strong roots in Scotland. I remember as a boy in 1950s Dundee queuing up at the local co-op to put in my book so that I got my messages delivered by the co-op, which was often the only retail outlet in the area. Sadly, such practices, as well as the dividend the co-op used to pay, have in many cases been lost, but we must give credit to the co-operative movement for coming up with new and innovative ideas, pressing them on Governments through elected Co-operative Members of Parliament, and furthering the ideals and spirit of the movement.
  If successful, the Bill will further the progressive action taken or encouraged by Governments for the past 20 years and in recent Budgets. The positive comments of hon. Members on both sides of the House, including the hon. Members for Aylesbury (Mr. Lidington), for Kingston and Surbiton (Mr. Davey) and for South Norfolk (Mr. Bacon), testify to our commitment to stop indulging in "yah-boo" politics. Such positive views will help to lay to rest the conflicts that long beset the world of industrial relations.
  We have lived through tumultuous times. I well recall the debates on "In Place of Strife". The Donovan report and the report of the royal commission on industrial democracy set some of the context of today's debate. We all remember the industrial relations courts at the start of the 1970s, as well as the three-day working weeks, social contracts 1 and 2, and the miners' disputes. The heavy-handed legislative approach of the 1980s and 1990s divided Britain right down the middle.
  By way of contrast, I remember part of my first experience of teaching in further education. I had to explain concepts of business structure to new apprentices drawn from a wide range of trades; we discussed how they could set up business in an "enterprise" fashion, or using an alternative model. Teaching them for their city and guilds general studies exam involved a video that reviewed the development and workings of the Mondragon co-operative—an industrial complex in north-east Spain.
  We are a long way from creating that sort of enterprise in terms of size, integration and contribution to the economy. However, the Bill's objectives are welcome,

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  marking a rejection of the battle and conflict of old-style industrial relations and taking us a small step away from the old idea of "them and us". Through its three main objectives, it would extend the idea of co-operative productive activity.
  First, the Bill extends the tax relief benefits already on offer to more companies and employees. That is obviously welcome because it gives more companies and more people the chance to be involved. There has been much discussion of the John Lewis Partnership and how, up to now, that has not been able to benefit from such a scheme. I hope that, in Committee, that advantage will be extended to that company, which has done so well in its endeavours for its work force.
  The Bill makes it easier for companies to become full employee-owned co-operatives, but we have a long way to go. We should be doing all that we can to encourage such activity. But most importantly, the Bill encourages, enables and involves employee shareholders, on a collective basis, to play a greater role in the management of their shares held in trust and in the direction of the company that employs them; and thereby, however indirectly, to become more involved in the management and direction of the company which provides them with their livelihood and which often supports the livelihood of many in the neighbourhood in which the company is located. That will ensure that the business survives and makes a profit, which is important.
  From the research done by my hon. Friend the Member for Edinburgh, North and Leith, it is evident that experience shows that where such schemes are in place, productivity, profits and worker satisfaction are greatly improved. In the cut-throat, competitive economic world of today, those are essential elements in the survival of many companies throughout Britain.
  In my intervention I referred to the footloose attitude of multinationals. In the recent announcement by Levi Strauss in Scotland of the loss of more than 450 jobs in Dundee and 150 jobs elsewhere, productivity was one of the major reasons for the shell-shock proposals that have put so many jobs at risk after 30 years of successful production and profit making in Dundee. No one wants to wake up to discover that a company in one's locale is, in a matter of days and without real notice, in crisis. The first notice that I had in this case was a letter delivered here to the House of Commons on Thursday. That is something that hon. Members and their constituents do not wish to see and hope to avoid.
  Not that Levi Strauss is a bad employer; on the contrary, it was a model employer, heavily involved, through the community development responsibility fund, in many worthwhile projects in Dundee and elsewhere. However the company's structure and the way in which it takes decisions, without any real input from its employees, creates the feeling of helplessness that I hope the Bill will help to counter; along with the helplessness felt by elected Members at our inability to influence corporate decisions in such company structures where employees are disfranchised because of the multinational nature of the operation. The disillusion in management and the productive process is something that we should be trying to avoid. We should be trying to encourage more participation by employees in good decision making for the benefit of the company. That is the crux of the Bill.
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  I send my best wishes to the Secretary of State for Northern Ireland, my right hon. Friend the Member for Hamilton, North and Bellshill (Dr. Reid), who, with my hon. Friend the Member for Dundee, West (Mr. Ross) will be meeting the management of Levi Strauss this afternoon in Scotland because the plants are located in their constituencies. They will put the case for a lifeline based on the real improvement in productivity that the company has seen over a long period and the commitment of its work force. Hopefully, as I tried to stress earlier, in future we could look at ways in which to promote employee share schemes in multinational enterprises, thereby curbing their often footloose tendencies. However, that is for another day and another debate.
  To conclude my brief contribution, I pay tribute to the commitment of my hon. Friend the Member for Edinburgh, North and Leith, a member of the Labour and Co-operative party, to the principles and ideas of the co-operative movement. The Bill may be small but, if successful, it will have an impact well in excess of its brevity. Its softly-softly approach, without the push for legislative requirements, is in the spirit of the co-operative movement. It certainly helps to close the gaps in employee share ownership between us, our European neighbours and the United States. Most significantly, it continues to build on the all-important bridges that establish links between employees and employers, between the managed and the management, and between capital and labour which, historically, has often been beset by struggle and conflict in this country. If the Bill achieves that goal, it will be to the benefit of all concerned.
  I wish my hon. Friend all the best in his endeavours to get the Bill into Committee and on to the statute book. Like other Members, I think that there will be a lot of discussion and argument about its final details. I would be happy to help my hon. Friend in any way that I can, although I am not a great expert on tax or fiscal measures.
  Reference has been made to the political slogan of the Conservative Government of the 1980s and 1990s to do with trying to create a small shareholder democracy, under which council houses were sold off up and down the country. Much of the privatisation programme was sold to the public under that banner. The Bill tries to create a shareholder work force—a point strongly made by the hon. Member for Aylesbury (Mr. Lidington)—with a genuine share in business decisions and business. That is a commendable and hopefully achievable aim.
  The Government are keen to promote the creation of a true stakeholder economy. We could look at models for such activity, as has been said, including models for allowing football fans to have much more involvement in the shares of club companies. One of my own city teams has been racked by a share problem; the old directors were sacked by new directors, and the fans had no real say in what happened. We could also allow tenants with a long-term involvement in housing a greater say in the direction and control of the organisations that provide their accommodation; there has not been a great deal of work on housing trusts.
  I hope that the Government support the measure, and shall be glad if the Paymaster General says that she and the Government do so in her summing-up. Finally, I thank you, Mr. Deputy Speaker, for allowing me to make a brief contribution to the debate.
  12.38 pm
  Mrs. Cheryl Gillan: I am pleased to have caught your eye, Mr. Deputy Speaker, as I want to join other contributors to our debate in congratulating the hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) on his success in getting a high position in the ballot and introducing the Bill. There is an unusual consensus across the Floor of the House that it has merit and deserves further examination in Committee. I hope that the Minister will allow it to make progress and be examined in more detail in Committee.
  I do not want to delay the House long, but having intervened earlier, I wish to make a brief contribution to echo concerns already expressed about the Bill as drafted. I do not need to reiterate the points that my colleagues and I have made about the John Lewis issues; the Minister has taken them on board and I am sure that she will address them later. Like other contributors, I am concerned about red tape and the cost of the proposal. I hope that there will be an opportunity to address those issues.
  For understandable reasons, a regulatory impact assessment has not yet been carried out for the Bill. I should like to be sure that a company which chose to take part in the schemes introduced by the Bill would not be subject to onerous red tape requirements. Although I am in favour of employee share schemes, I believe that we should do all we can to reduce the red tape associated with them. After all, there is no point in implementing worthy employee share schemes in the interests of raising productivity, for example, if the amount of red tape created in other areas overwhelms businesses and ends up reducing productivity.
  Real examples support the concern about red tape. For example, let us consider the problem of tapers. When the 2000 Budget was introduced, all shareholders in an unquoted trading company became eligible to qualify for a higher rate of capital gains taper relief for the benefit of start-up companies. Although welcome, the relaxation in the definition of business assets in itself created complications. Gains may be subject to different rates of taper, depending on the relative periods of ownership, as a business or a non-business asset.
  The apportionment is on a strict time basis and does not take account of the asset's value at any given point in time. There are pitfalls, and it is easy to trigger anti-avoidance provisions inadvertently—for example, giving employees shares that carry conversion rights could result in any gain on the ultimate sale of the shares being taxed as income, not capital. Depriving the employee of all taper relief may also produce a national insurance charge for the Chancellor.
  Overall, schemes can sound great in principle, but as soon as the complex tax rules or the compliance rules come into play, there can be unfortunate side effects, as we all know, which result in extra red tape or unnecessary complexity.
  Finally, I am concerned about the possible costs of the measures to the taxpayer. As I understand it, the intention of the tax measures is to address the problem whereby many firms, especially the small family-owned ones, are eventually handed over to their employees, with expensive corporation tax liabilities incurred on the transfer of a block of shares to an employee trust. The Bill would remove that legal technicality, making it
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  possible for more businesses to be transferred into employee ownership. That seems a perfectly acceptable proposal, but I should like to know the cost to the Exchequer of this aspect of the Bill.
  I am pleased to have had the opportunity to make a brief contribution. Overall, I support the measures, which spread the benefits of employee share ownership. However, as with many Bills, the devil is in the detail. I look forward to hearing the Minister's response.
  12.42 pm
  Mr. Tom Harris: I am grateful to be offered the chance to speak in the debate. Like most other speakers, I begin by congratulating my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz) on coming near the top of the private Members' ballot. I entered Parliament at the same time as my hon. Friend and chose not to submit my name for the ballot—a decision that I have not regretted. As was said earlier, I cannot imagine a worse feeling of panic than being in the House for a week and discovering that one is near the top of the private Members' ballot. I congratulate my hon. Friend on his staying power and self-control.
  I declare an interest as a member of the Co-operative party, although I am not a Labour and Co-op Member. The Co-operative party supports the Bill, as do I personally. I would have supported it, whether or not I was a member of the Co-operative party.
  I should have liked to welcome the presence of representatives of the Scottish National party here at Westminster. I find it incredibly discouraging that a party that claims to stand for Scotland does not see the need to come to the House on a Friday to represent its constituents' interests and to discuss a measure that will have an effect throughout the United Kingdom, including on many thousands of workers in Scotland. It is a disgrace that SNP Members are not present. They are showing their contempt for this Parliament by showing their contempt for the interest of their own constituents. I hope that that will be noted by hon. Members in all parts of the House.
  It would be useful to put this debate into context. As a Labour party member of 18 years standing, it is difficult for me to think about the debate on share ownership without remembering some of the debates that have taken place in the Labour party, the House and the country as a whole in the past 20 years and even before that. I am delighted that we are having this debate and that the Bill's promoter is a Labour Member. We should be very proud of that. However, the Labour party has not always been as far-sighted and open-minded on share ownership. For example, when I joined the party in 1984, if any Labour candidate or, even worse, Member of Parliament, was discovered to own shares in a private company, especially on the eve of an election, it was something of an embarrassment and certainly a cause for media concern. At that time, Lord Healey had to admit publicly on television that he had used the private health service to carry out an operation on his wife, and similarly, that was considered to be a huge embarrassment for the party. I am extremely grateful that we have moved on leaps and bounds since those times, not least because we have moved from opposition and into government as a direct result of having done so.
  Ms Claire Ward: Will my hon. Friend confirm that some of our Labour party colleagues have

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  sometimes misunderstood the concept of holding shares in the Co-operative party? When one admitted that one was a co-operator and held shares in that organisation, some people began to worry in just the way that he describes in relation to the private sector.
  Mr. Harris: My hon. Friend is correct. I shall add that to the very long list of deliberate misinterpretations of various actions that hon. Members in all parts of the House have had to put up with, whichever party we belong to.
  The hon. Member for Aylesbury (Mr. Lidington) mentioned the profound impact of the Thatcher Government on the country's attitude to share ownership. It would be churlish to deny the impact that Baroness Thatcher and her Government had in that regard. I do not agree, however, with his suggestion that all of the innovations that the Conservative Government introduced in this area were entirely positive. Even that statement would not have been couched in such moderate terms 20 years ago, but I shall leave it at that, and say that their actions were not entirely positive. For example, in 1985, The Observer reported that, within two years—coincidentally, this was to happen in the run-up to the 1987 general election—the Conservative Government would have contrived to create 5,000 new shareholders in previously nationalised companies in every marginal seat in the United Kingdom.
  It is appropriate to suggest that, although it was part of the Government's agenda at that time to create a property-owning and share-owning democracy, there was a very large element of cynical manipulation of the electorate. I am happy to take any interventions on that point. Perhaps credit is due to the Government of the time, as the strategy was very clever. However, it was also balanced. It was intended to promote share ownership and an understanding of how the economy works, and to encourage people to have a financial interest in the economy, but it was also an attempt to ensure that the Conservative Government were re-elected. It was a successful attempt, so I cannot bang on about it for too long, but we should acknowledge the cynicism.
  Mr. Luke: Does my hon. Friend accept that the 5,000 new shareholders that the Conservative Government said they had created in constituencies throughout the United Kingdom still believed in the welfare state and free health care for all? Despite the change in capital ownership, people have remained true to core values.
  Mr. Harris: My hon. Friend is right, and I do not want to be interpreted as saying that we lost the 1987 election because of share ownership. People who perhaps continue to own shares in the private companies to which I referred have largely voted Labour in the past two general elections. I congratulate them on their judgment.
  Employee ownership is different from what is commonly known as share ownership. One of the problems with the Conservative experiment in the 1980s was that it was based on short-termism. People with no interest in British Telecommunications, British Gas or British Nuclear Fuels were encouraged to buy shares in them.
  Linda Gilroy: My hon. Friend recalled the 1997 election. Does he remember that a strong theme of the
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  campaign was that social justice and economic efficiency went hand in hand? Does he agree that the measure would extend employee share ownership along those lines?
  Mr. Harris: My hon. Friend makes a good point and the Bill chimes well with the general view that has existed since before the 1997 election.
  The Government of the 1980s did not encourage private individuals to buy shares in former nationalised companies in order to promote an interest in their expansion and development. The experiment was specifically marketed as, "Give us your money and we'll double it in a short time. You can sell your shares quickly and walk away with a far bigger profit than you would have made with a building society."
  Ann McKechin: My hon. Friend makes an excellent point about investment. Does he agree that increased employee participation should tackle the lack of investment in training and in research and development that has bedevilled British industry, especially the manufacturing and construction industries, for many years?
  Mr. Harris: My hon. Friend makes a good point, which is annoying, because I was about to make it. However, I am grateful to her.
  When considering the Thatcherite reforms of the 1980s, economists say that short-termism has been the long-term problem of the British economy. When individuals are encouraged to make short-term investments in industry, we cannot hope to generate the investment that my hon. Friend mentioned. There has been a sea change in attitude, and the Government are pursuing a longer-term strategy. However, such a strategy was rarely pursued by the Conservative party when it was in government.
  Ms Munn: Does my hon. Friend agree that, although the contribution of the hon. Member for Huntingdon (Mr. Djanogly) was interesting in its detail and complexity, he missed the point of the Bill? He spoke at length about share options and people selling shares, and asked whether that was a risk, and whether they would get their money back, instead of considering the benefits of longer-term investment in not only money but skills, ability and commitment to an enterprise.
  Mr. Harris: I absolutely agree, and I look forward to seeing whether the hon. Member for Huntingdon—who, unfortunately, is not in the Chamber at the moment—intends to support the Bill when it is in Committee.
  Participation is the key factor in all employee share ownership schemes. Sadly, perhaps because of the structure of the British economy, most of the research into this has been carried out in the United States. It was mentioned earlier that there is much wider participation in these schemes across the Atlantic than here. The largest survey of which I am aware was carried out between 1983 and 1986 among 3,700 employees in 45 companies in the United States.
  In its conclusions, the survey identified the three most important factors in the success of any employee share ownership scheme. The first is how much stock is transferred to employees each year. It found that contributions under 3 or 4 per cent. a year simply did not

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  get employees interested enough. That would not get their attention, unless, of course, the value of the stock was increasing at a spectacular rate.
  The second important factor is the employees' involvement and participation in decision making. My very first job was as a reporter on a local newspaper, the East Kilbride News, and one of the biggest employers in the area was Motorola. Motorola had an interesting and innovative strategy on employee relations. It did not recognise trade unions, which I still believe was a major mistake. Thanks to legislation introduced by this Government, that is no longer an insurmountable problem for the trade unions.
  Motorola did, however, have employee councils, and it was noticeable, on visiting the factory, that the employees were much happier and more content when they were actively encouraged to take decisions or at least consulted by the management before major decisions were taken. There was also a much lower turnover in the work force. One of the features of the Bill relates to participation. It is crucial that employees have a practical role in running the company in which they are employed.
  The third factor in the American survey is how often a company communicates with employees about the decisions that it is taking, which relates to the second point about participation. Interestingly, many of these surveys have found that other factors are far less important. For example, factors such as whether a company is unionised, the size of the company, the type of business it pursues, or even the demographics of the work force do not have as much impact on the success of an employee share ownership scheme as those three main factors.
  I hope that the Government will support the Bill. We shall find out when my hon. Friend Paymaster General addresses the House. Incidentally, I think that, in Committee, it should probably be re-titled the Employee Share Ownership (John Lewis Partnership) Bill. I congratulate the John Lewis Partnership on its extremely effective lobbying. When I was lobbying, in a previous incarnation, I wish that I had been half as effective as the John Lewis Partnership. Of course, I had nowhere near the resources that it has.
  The Government have a long-term strategy for industry, and the Bill chimes well with that general philosophy. I hope, therefore, that when my hon. Friend comes to the Dispatch Box, she will tell us that the Government support the measure, which is essentially an amendment to existing legislation, rather than a brand new measure.
  An eloquent Conservative speaker—I think it was the hon. Member for South Norfolk (Mr. Bacon)—spoke of the difficulty of rewarding part-time and low-paid workers, precisely the ones who often feel left out of share ownership schemes. I understand that the industries with the lowest-paid workers and with part-time workers have failed to motivate them by means of short-term measures such as one-off bonus payments. There has been a much more positive response to longer-term commitment on the part of companies. I hope that that philosophy will encourage low-paid and part-time workers to have a vested interest in their companies—although, thanks to the national minimum wage introduced by this Government, far fewer people than ever before now receive very low wages.
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  Turnover is a huge problem, especially—paradoxically—at times of low unemployment. The worst companies will have the highest turnovers at such times. It is difficult for a company to have a long-term healthy outlook when 20, 25 or 30 per cent. of its workers are constantly leaving and being replaced by people with, in many cases, no knowledge of or interest in the company. American surveys have shown that share ownership schemes can contribute hugely to reducing turnover.
  Ms Ward: Research shows that not just turnover but absenteeism is reduced. People who want to be involved in a company in which they have a stake do not want to take time off sick as an excuse, because they have a real interest in maintaining the company's profitability.
  Mr. Harris: That is an excellent point. Although we must not automatically describe all absentees as people who are not committed to their employers, it is true that those who feel they have a personal vested interest in the long-term health of their companies will be inclined to take far fewer days off sick. That will inevitably have an impact on productivity in the long run. Surveys have also shown that increases in sales and employment are much higher in companies with share ownership schemes.
  Employee share ownership also gets rid of the notion of "workers against employers", mentioned earlier by my hon. Friend the Member for West Bromwich, West (Mr. Bailey). It puts workers and employers on the same side, where they should have been in the first place. It thus helps to end industrial strife in which trade union shop stewards feel that they must win concessions from the "enemy", and employers feel that they must not give an inch to the "enemy" on the other side of the table. That division has crippled British industry for a huge part of the 60 years that have elapsed since the end of the second world war.
  The more that we extend share ownership schemes, the more I hope that we shall see positive industrial relations. Trade unions and employers will see the benefits of everyone working together to ensure that the owners of the shares—that is, the employees—gain from the productivity of the company.
  The United States General Accounting Office, in an ongoing series of reports, shows that productivity in companies that run share ownership schemes for employees is 52 per cent. better than in comparable firms. That alone should convince us of the value of such schemes.
  It has also been suggested that employee share ownership schemes can make privatisation programmes more politically acceptable—I am of course offering no advice to the Government as to future privatisation projects. However, employee share ownership can help to overcome the resistance of work forces to any new status or structure that results from privatisation. Furthermore, such schemes may encourage investors; they may be more likely to invest if they feel that there will be no conflict between the work force of a formerly nationalised company and its new private owners.
  I am delighted to speak on behalf of my hon. Friend's Bill. He has put a great deal of work into it and consulted many organisations about it. The Bill has only four pages but—if the House accepts it—it will have a major and positive impact on thousands of workers, not only in Scotland but throughout the United Kingdom. I wish it well.
  1.7 pm
  Mrs. Patsy Calton: I am delighted to be able to make a short speech. I must first declare an interest. I may have received more effective lobbying about the Bill than any Member in the Chamber, as my son works at John Lewis. He is employed at one of the most successful branches in the country—which happens to be in my constituency.
  John Lewis's workers are motivated. They are called partners and they are indeed regarded as partners. The company's principles and values have already been mentioned. Every week, the Cheadle store issues a staff magazine. I shall quote from an interview with a member of the work force. He was asked:
  "Which aspect of your job are you passionate about?"
  He replied:
  "The wellbeing of my team and the integrity of the Partnership. We're a unique business. We have high standards of conduct with each other and our customers. I feel very strongly for what we have achieved and I know that our enthusiasm for constant improvement stems from the fact that we are part of the Partnership and everything it stands for."
  That was the positive side. He was then asked: "What's your pet hate?" He answered:
  "Stock inaccuracies. In an ideal world we would all have the correct information the moment we needed. We're all still working on this."
  We need that kind of attitude in this country. We need managers and work forces to share a common aim and to be jointly informed.
  Earlier, my hon. Friend the Member for Kingston and Surbiton noted that John Lewis attaches great importance to part-time workers. We need to explore in Committee the effects of the Bill on part-time workers. I should support that, as would John Lewis.
  The hon. Member for Sheffield, Heeley (Ms Munn) said that we could avoid stress by exercising control on our lives. In my earlier life I was a teacher. One sees a great many more stressed people in teaching than one does on these Benches. The hon. Lady accurately identified what makes the life of a Member of Parliament less stressful than that of a teacher: we work just as many hours as teachers do, but we control our lives. We are the ones who decide when and how we put those hours in, and we have much greater freedom in that regard than teachers do. The issue of control and of being able to play an equal partnership role in one's life is important.
  This country's future lies in the work force, its leaders and the managers and owners of companies realising that their long-term interests are shared. Work is more than earning money. It takes up more than time. A work force who own their company and are truly involved in decision making and sharing in its success will be happier, healthier and more committed. The managers and work force of the future, and those who are successful now, recognise that their partnership is key. They respect each other's contribution.
  I applaud the Bill's aims and very much hope that it will meet with success.
  1.11 pm
  Mr. Andrew Love: I seem to have been left out in that I am the only hon. Member who has not been circulated with information by the John Lewis Partnership; I shall write to draw the matter to its attention.
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  I join other hon. Members in offering my congratulations to my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz)—I am sure that when he is in Leith, that title would change to "the hon. Member for Leith and Edinburgh, North". I congratulate him not only on his luck as a new Member in being drawn sixth in the first ballot that he entered—I could see the frustration on the faces of colleagues who have been in this place considerably longer and have never been drawn in the ballot—but, more important, on his choice of subject for his Bill.
  Inevitably, as a private Member's Bill it will be only a limited measure, but employee participation is an extremely important issue, for two reasons. First, as has been said, it is crucial to the efficiency of the economy. Productivity, which is central, can be improved by employee participation. The performance of our companies—their ability to compete—is at stake. The measure also chimes in well with the direction that the Government have been taking.
  Why is employee participation important? First, it engages with all the employees of a company—with their skills, their special knowledge and particularly their commitment to the company. If it is conducted properly, it can improve employees' motivation and drive innovation from the shop floor, which is where most of the best ideas in good companies come from.
  At its best, employee participation provides a genuine workplace partnership between the owners and those who represent them and the management and workers of a company. That has very important benefits for the company. First, as many hon. Members have said, it reduces employee turnover. Not only are workers retained for longer, but the effectiveness of their training increases. They do not go off and work for someone else as soon as they have completed their training. Therefore, investment in staff can pay dividends if one can keep hold of those staff.
  Secondly, and perhaps most important, employee participation fosters a more co-operative ethos. When we discuss the workplace in this country, we continually talk about confrontation. The Bill will help to develop a more co-operative ethos.
  Employee share ownership can assist employee participation in several ways. First and most obviously, it incentivises employees. In doing so it also, if properly structured, aligns the interests of both sides of industry in the same direction. To return to an aspect that has been central to the debate, it also increases performance and productivity.
  We normally have long discussions about productivity at the time of the Finance Bill and the pre-Budget report. The Treasury is on record as saying that we are not doing as well with productivity as we should and could be. The economy is going well, but we need to improve productivity. Even though it is a small measure, the Bill will go some way to achieving that.
  Share ownership and, in particular, some of the aspects of the Bill can have a beneficial impact on several issues that have been discussed today. First, short-termism plagues the British economy. Our competitors all take a much longer look at what is best for their companies. Shareholding by employees, who have a longer-term interest in their companies, will have a beneficial impact on the short-term outlook of many in power in this country.

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  Secondly, such share ownership will help company investment decisions. We all know about the dearth of research and development and about the need to ensure that we have adequate capital, especially behind our manufacturing industry. Every time that we compare the capital used per employee in Britain with that used in Germany or the United States, we see that we are failing in this country. The Bill would bring home that fact in boardrooms throughout the country.
  Thirdly, corporate governance is an extremely important facet of the future of the company sector in this country. A wider stakeholder voice—whether for employees, or for customers and others—is very important.
  All that will assist company performance, but I do not want to give the impression that it will revolutionise things overnight. We ought not to overstate the benefits, but there is a lot of evidence—such as that cited by hon. Members on both sides of the House today and that from the United States, where significant numbers of employees are involved in such plans—to show the benefits that employee share ownership can bring.
  Many hon. Members have said that such schemes have been with us for a very long time. They go back to the early 1980s—a fact that Opposition Members have drawn to our attention. Indeed, three different schemes operated in this country when the Labour party came to power in 1997: the approved profit-sharing scheme, which has been placed in abeyance, the save-as-you-earn scheme and the company share option plan. About 2.5 million employees enjoy the benefits of those three schemes. That is to be commended, but the shortcomings of those schemes was the theme of the consultation document on extending share ownership that the Government issued in 1998.
  Several facets of those schemes were considered in that document. The first issue is providing a greater reward for the long-term commitment of employees to their companies. Many hon. Members have mentioned that issue and explained how it is reflected in new legislation. The second issue is creating an enterprise culture, which we talk about a lot. Often—certainly in the past—our debates have been about creating an enterprise culture in the boardroom, but we need to create that culture on the shop floor, and the schemes, as currently structured, go some way to doing that.
  Perhaps the most important issue that the Government highlighted was the need to extend such schemes to a much wider range of companies in our economy. We often talk about the importance of small and medium-sized companies to the United Kingdom economy, yet the existing schemes did not really involve them, and the schemes introduced in 1999 and 2000 represented an attempt to do so.
  Experience in the United States shows the benefits that can be produced. A report on research into those results states:
  "The key conclusion … is that employee share ownership, especially when combined with other means of active employee participation, does have a positive impact on employee motivation, productivity and corporate performance."
  I shall return to that point later, because the Bill refers specifically to active employee participation.
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  There are other facets of the Government's concerns about the schemes that existed before 1997, the first of which relates to fairness. We cannot have fairness if only a limited number of senior managers are allowed to participate in a scheme. The only fair and proper mechanism is to have all-employee share schemes. Inevitably, they will be different for different employees, but they need to include everyone if they are to be fair.
  I am a little surprised by some of the comments of Conservative Members, because the new SIPs were an attempt to reduce complexity and to reduce the cost to companies of share ownership schemes so that they could be extended to the smaller companies that were obviously concerned about such issues. It was to recognise the concerns expressed in the consultation exercise that the new scheme was developed. It has several features that were not in any of the previous schemes.
  I wish to highlight some of the new features, and the first is that share awards can be performance related. I am sure that everyone will join me when I say that I am a little disappointed that many of the companies that have taken up the new schemes have not related awards to performance. The Government may wish to look at that in the future. Secondly, the new scheme gives companies the freedom to design schemes to suit their particular circumstances. One of the great difficulties with previous schemes was their rigidity, but companies now have much greater freedom.
  Forfeiture and the need for employees to stay in a scheme are an important aspect of the new scheme, and it is one that I strongly support. The new scheme provides flexibility for the employer and employee and, perhaps most important for the employees, it allows them to buy shares out of gross income.
  The Bill considers some of ways in which the 1999 and 2000 legislation can be improved. It talks about extending SIPs and the opportunity to take up a SIP for companies owned by employee trusts. That is important. We need to extend the schemes to a wider range of models of corporate ownership. We should not think that the share ownership company is the only corporate entity or that it is the most competitive, efficient or productive. There is plenty of evidence to suggest that there are other models, and the Bill will allow employee trusts to take part in employee share ownership. According to a parliamentary answer that I received in November last year, that could extend to as many as 60,000 employers. I shall return to that important consideration later.
  I referred to United States research about active employee participation. Extensive research has also taken place in the United Kingdom and I wish to quote from the research carried out by Birkbeck college, which appears in the mutual pamphlet from Employees Direct. It states:
  "Two important conclusions have emerged. though. The first is that employees do respond positively to what might be termed 'high commitment' human resource practices such as promoting participation and involvement. The second is to confirm the sort of causal links suggested above, from human resource practices such as participation and involvement through to the attitudes and behaviour of employees and from there on to performance outcomes such as productivity."
  That is an academic way of saying that we need to involve employees and give them a meaningful voice in their company. Only if they have a role and some influence—each company will have to structure how it provides that—will they commit to the company.

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  The hon. Member for Aylesbury (Mr. Lidington) spoke—I believe that he thought eloquently—about the distribution of shares through privatisations. The vast majority of employees sold their shares at the earliest opportunity, which does not benefit companies and is clearly not in their interests. Electing employee representative is one way to foster a commitment that will achieve the objective of getting employees to hold on to their shares. As democrats, we should be in favour of that.
  My hon. Friend the Member for Edinburgh, North and Leith is right not to be prescriptive about that. No doubt there will be many views, as there are in the Chamber today, on what would be an appropriate election. We need flexibility, which is at the core of any development in this matter and needs to be maintained. The important principle is employee representation. Experience suggests that until now management has represented employee interests on a trust. The Bill would give employees a voice.
  Mr. Edward Davey: The hon. Gentleman raises the issue of elections. It has cropped up several times and, as hon. Members said, we could consider it in Committee without being too prescriptive. Perhaps he can set out criteria or principles that would determine how a group of workers in a company would elect representatives. For example, perhaps we could state in the Bill that every employee should have a vote of equal value, without being too prescriptive about electoral systems.
  Mr. Love: Let me state here and now that I shall not be a member of that Standing Committee and will not be able to enter into that debate. However, if the share ownership plan is for all employees, everyone who is involved must be able to take part in electing those who want to represent them. I suspect that all hon. Members would uphold that principle. No doubt principles will be laid down for such elections, but it will be important to allow some flexibility; otherwise, the Bill will be as rigid as other legislation, which will not help to persuade companies to take up the scheme.
  The Bill also deals with the discrimination that those people who want to make a significant move towards employee ownership experience as a result of paying corporation tax up front and of the considerable time that it takes to distribute shares. Opposition Members are having a rather good time. I think that the right hon. and learned Member for Rushcliffe (Mr. Clarke) was on the sensible wing of the Conservative party, and this may well be a case in point. The arrangements for corporation tax discriminate against small family-run businesses in particular. Rather than selling out to a major larger competitor, they might prefer to reward their employees for many years of long service, but that option is not open to them. The current tax regime puts them at a disadvantage and no owner would choose to put himself in that situation, so it is sensible to make the change.
  The 10 per cent. threshold is a safeguard. It would at least make companies pause for thought before using the measure as a tax-saving mechanism, because they would be creating a significant employee shareholding. That might want to do that, but I suspect not in the circumstances. No doubt that could be discussed at length in Committee.
  Finally, I want the Minister to have a flexible approach to the extension of employee share ownership. In the Finance Act 2000, the Government extended the SIP
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  scheme to industrial and provident societies, in particular to redeemable shares. Such shares do not require the same involvement in the company as ordinary share capital, but the Government thought that that would benefit employees. I supported that policy and the impetus behind it. However, I mentioned earlier that mutual organisations have considerable difficulty. As a result of discussions that I had, I wrote to the previous Financial Secretary to the Treasury, whose response was illuminating:
  "so far no arrangement has been identified that would replicate the effect of share ownership in incentivising employees, aligning their interests with those of other shareholders and encouraging improved productivity."
  However, discussions were on-going. I asked my hon. Friend the Economic Secretary to the Treasury a parliamentary question and received the response:
  "We have not yet been able to devise a way in which the link between share ownership and company performance might be reflected in such corporate structures."—[Official Report, 13 November 2001; Vol. 374, c. 608W.]
  Building societies and other mutuals do not issue shares. Therefore, it is very difficult to have a share ownership scheme. I understand the problem, but employees of commercially successful businesses are being disadvantaged because they are not allowed to take part. Even more important, mutuals are not operating on a level playing field. They are suffering a disadvantage, and there are many other disadvantages, so I hope that the Minister will look at the issue.
  The Bill allows the Government to extend employee share ownership to employee trusts. I hope that over the next few months the Minister will look constructively at the matter to see whether a similar extension could be made for mutual organisations. The scheme has dramatic benefits for companies and for employees. It should be available as widely as possible.
  The Paymaster General (Dawn Primarolo): I congratulate my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz) Leith on introducing the Bill. Like all hon. Members who have spoken, I recognise—dare I say it?—his bravery in taking such an issue through the House under the private Member's Bill structure. It is a difficult task and will give him a great deal of work over the next few months. I thank him and his team for working so constructively with me and my officials on the Bill.
  Hon. Members on both sides of the House have contributed to what has been an excellent debate on this important issue. Increasingly, employee share ownership is at the heart of the Government's productivity agenda. All Members recognise the importance of the style of company ownership and the structures of a company, as well as of rewarding employees.
  I am pleased that we are agreed on the general thrust of the Bill. However, there are elements of the Bill that I would not be able to support. I will come to those. My comments will follow many of the points that were made by the hon. Member for Aylesbury (Mr. Lidington) in his thoughtful speech.
  As another caveat, I say to all hon. Members that the tax system is a very important part of our democratic system, but it is not easily amended or dealt with. It does not always produce the effect that hon. Members believed it was going to produce when they drafted legislation. The

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  House will forgive my caution, but after five years as a Treasury Minister, I understand that things do not always work precisely as one intended them to.
  First, I shall focus on the Government's record. There is a wealth of evidence to support employee share ownership. In July 2000, the Government introduced the share incentive plan and enterprise management incentives. The two schemes are very different, but both are aimed at encouraging enterprise and productivity, and both offer generous tax reliefs.
  At the end of October, I launched a nationwide roadshow on the share incentive plan, with my right hon. Friend the Chancellor of the Exchequer. The launch was supported by Digby Jones of the Confederation of British Industry, John Monks of the Trades Union Congress, and George Cox, all of whom expressed unreserved support for the plan. That demonstrates that all hon. Members who have spoken are right to say that there has been a sea change in attitudes toward participation in employee share ownership schemes.
  The aim of the roadshow, run jointly with ProShare, was to tell companies directly about the benefits of SIP and how to go about introducing a plan. Comments have been made about complexity; in fact, after extensive consultation on SIP, the options available to companies are as simple or as complex as they feel necessary in their circumstances. I do not want the House to think that there is a "one size fits all" approach.
  Since enterprise management incentives were introduced in July 2000, we have made improvements. Already, almost 2,000 companies have notified us that they have granted more than 16,000 options. This month, we doubled the gross assets limit to £30 million, allowing 6,000 more small and growing companies to qualify. There are other tax approved schemes—the ones I have described are not the only ones that give employee share schemes access to tax advantages.
  No one can doubt the Government's commitment to employee share ownership. A sound basis for our commitment is provided by research that clearly shows that companies with widespread employee ownership and participation outperform their rivals. Some of the most powerful support is found in a survey carried out by ProShare. It found that 83 per cent. of employers who had introduced a share plan said that it met or exceeded their expectations. There are also interesting results from shareholding employees: 34 per cent. said that they were now more interested in the company and its activities, and 25 per cent. said that share ownership made them more likely to stay with their employer. Similar views were expressed by everyone who has spoken in the debate. Results like those can translate into a significant effect on business success.
  The Government are justifiably proud of SIP, which is the most tax-advantaged share plan ever introduced by a United Kingdom Government. Our aim in introducing the plan was to encourage employees to take a long-term stake in the company for which they work. We want to align employees' interests with those of other shareholders, and give them access to the rewards that flow from the success that they help to create. That is crucial to fulfilling the principles underlying the plan.
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  The plan was developed in partnership with industry, which wanted a framework that would appeal to smaller and unquoted companies. SIP was therefore designed to meet the needs of a range of companies. It has already proved successful. To date, 260 companies have had share plans approved and well over 250 plans are awaiting implementation by the company or are in the process of being approved by the Inland Revenue. The plan is being taken up by companies both large and small, listed and unlisted.
  The hon. Member for Aylesbury asked for details and I can tell him that, of the 260 plans so far approved, 150 are in companies that never previously had an all-employee share scheme, and 71 companies are replacing their old profit sharing schemes with a share incentive plan, and that is what we hoped for. In addition, another 250 or more plans are in the process of being set up by companies. The hon. Gentleman asked how we would meet our target. No time limit was placed on the target of doubling, but given the present pace of change, we can be reasonably confident that in the next few years we shall be close to our target.
  Several hon. Members asked about the involvement of low-paid and part-time workers in share incentive plans, and it seemed to be the view that, particularly in the retail sector, the plan was not being taken up. Hon. Members should be aware that a number of the large supermarket chains already operate, or are bringing in, a share incentive plan. Employees must be properly advised about the most appropriate way in which to use their funds. All hon. Members will appreciate that shares are not a one-way street and there is a risk—a point that the hon. Member for Kingston and Surbiton (Mr. Davey) sought to make in an intervention.
  As the Bill seeks to extend the share incentive plan, it is important that I should spend a little time describing how it works. The share incentive plan allows a company to bring its employees into direct share ownership in several different ways. Up to £3,000 worth of free shares can be given annually to participants tax free. In addition, employees can contribute up to £1,500 a year out of pay before tax and national insurance to buy what are called partnership shares. Employers can then reward the commitment by awarding up to two matching shares for each partnership share bought.
  Employees pay no tax or national insurance on the shares that they are awarded under the plan as long as they are held in the plan for at least five years. I shall not go through the reasons for that, because they have been adequately dealt with today. There are capital gains tax benefits and links to pensions and individual savings accounts. There are also tax breaks for companies, which are allowed deductions against corporation tax for the costs of awarding shares and for their costs in setting up a plan. Employers make substantial savings on employers' national insurance contributions on the salary that employees use to buy partnership shares and on shares given to employees through the plan. It is fair to say that all parties gain from the share incentive plan, whether from direct tax breaks or greater productivity.
  Having set out the Government's commitment to employee share ownership schemes, I shall deal with the Bill, which sets out to change the rules of share incentive plans and has three major objectives. First, it seeks to extend the share incentive plan to companies whose shares are held for charitable purposes or in an employee

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  benefit trust. A number of changes are needed to allow that, including allowing the award of share types not currently allowed in the plan. Secondly, the Bill provides for elected employee representatives to act as trustees of a company's share incentive plan. Thirdly, the Bill aims to encourage the transfer of shares into employee ownership through early corporation tax deduction on money given by the company to a plan trust for buying shares from an individual on behalf of the company's employees.
  I shall deal with each of those aims in turn. Clause 1(2) seeks to extend the share incentive plan to trust-controlled or employee-controlled companies. Because of their structure, those companies are currently excluded from the approved employee share arrangements. They cannot use the arrangements because their constitution prevents them from awarding shares to employees.
  A number of Members asked about the cost of the Bill, including the hon. Members for Chesham and Amersham (Mrs. Gillan) and for Aylesbury. The cost of extending the share incentive plan to trust or employee-controlled companies would be about £25 to £30 million a year, assuming that there is high participation. Corporation tax costs, if the Bill is amended as I seek and as I hope my hon. Friend the Member for Edinburgh, North and Leith will accept, would be about £5 million to £10 million a year. However, as a Minister, I have a problem with that part of the Bill, which is not drafted tightly enough to ensure against abuse. The John Lewis Partnership has been mentioned a great deal; I am not suggesting for a minute that such organisations would be involved. However, as we saw in high costs to the taxpayer of the profit-related pay experience, there are people who seek to use elements in the tax system to reduce their tax, even though they were not designed for that.
  Awarding different classes of shares is a problem. To allow employee-controlled companies to use the share incentive plan without changing their share structure, clause 1(4) seeks both to extend the class of share that can be accepted under a plan and to place restrictions on it. It seeks to enable ordinary share capital held in trust or for charitable purposes to remain untouched, by allowing companies to use another class of ordinary share for the plan; that class may have restricted rights which may affect their value.
  The share incentive plan does not allow companies to use anything for the plan other than the company's ordinary share capital, to ensure that employees are not being awarded shares inferior to the shares of other shareholders. I appreciate the point about the John Lewis Partnership. Under the 1929 settlement, the company established a profit-related scheme, under which all distributed profits to the employees as partners, in the form of an annual profit-related bonus, were paid pro rata to the salary. Because the company could not take part in employee share ownership schemes, in 1990 it converted its existing bonus schemes into a tax-relieved profit-related pay scheme. I do not want to go over again the problems with the profit-related scheme, which was designed to help companies like John Lewis, but had an astronomic cost for the taxpayer. Experience teaches us to be careful in that area.
  I am aware that employee and trust-controlled companies feel that they are at a disadvantage compared with other companies which can use approved employee share schemes, particularly now that profit-related pay has been phased out.
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  This is an extremely complicated area, to which many of my hon. Friends referred. We have struggled in the past and we continue to struggle to see how we might help such companies. I know that my hon. Friend the Member for Edinburgh, North and Leith and his team have encountered the same difficulties in devising a practical approach for the Bill. That, in part, is why I hope that he will agree that these provisions should be removed from the Bill. I cannot consider an arrangement that moves away from ordinary shareholdings, or one which breaks or weakens the link with improved productivity, or reintroduces profit-related pay by some other means.
  I am, of course, conscious that flagship employee-controlled enterprises have successful arrangements for achieving and rewarding employee participation and involvement. Various such structures were discussed today. It is unclear how they would want to use the share incentive plan, and in what ways it would add to the incentives already available to their employees.
  We have, however, already provided for co-operatives to participate in the share incentive plan by allowing them to use redeemable shares in the plan, which conventional companies using the plan cannot do. That was because redeemable shareholding is the vehicle for co-operative membership. Allowing redeemable shares meant that employees would be issued with the same shares as other members.
  Having asked for the provision to be removed from the Bill, I will continue actively to consider whether there are other ways of extending the share incentive plan to trust and employee-owned companies that wish to use the plan as conventional companies do, in ways that preserve the aims of improved productivity and do not allow scope for abuse. I hope that my hon. Friend the Member for Edinburgh, North and Leith will accept that.
  On elected employee representatives as trustees of a company's share incentive plan, I share my hon. Friend's aim of encouraging greater employee participation. The proposal in subsection (5) is that the deed of a share incentive plan trust should allow companies to have at least one elected employee to act as a trustee. I am happy to support the election of employees as trustees. Strictly speaking, that can already be done, but if hon. Members want it to be beyond doubt and written into the Bill, we have no problem in supporting that.
  I am happy for Inland Revenue officials to work with my hon. Friend and his team on a trust deed that would provide for elected employee trustees. That could be offered alongside the existing model trust deed on the Inland Revenue website.
  Finally, I shall deal with early corporation tax deduction on money given by a company to a plan trust to buy shares from an individual. Subsection (6) provides for a corporation tax deduction to be given when a company contributes money to a share incentive plan trust to buy shares from one or more individuals. The figures of £5 million and £10 million that I gave are calculated on the basis that what I am about to say will be accepted, not on what is in the Bill. That would be more expensive.
  Again, I support my hon. Friend's aim of encouraging individuals such as family owners to sell their shares into employee share ownership. I am mindful, however, that the early corporation tax deduction that is currently available through qualifying employee share ownership trusts—sometimes called QUESTs—has been used very

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  little by the individuals such as family owners for whom it was originally designed. The Government have already gone a long way to facilitate the transfer of shares from individuals such as family owners into the share incentive plan.
  My particular concern with the provision is that the corporation tax deduction would no longer be linked to the distribution of shares to employees, which is crucial to the relationship between productivity and employee benefits. The shares acquired by the plan trust could remain indefinitely in the trust. As I said, that would be contrary to the fundamental aim of the share incentive plan. I know that my hon. Friend the Member for Edinburgh, North and Leith is aware of those concerns and I hope that he accepts that the provision is drafted a little too widely, in terms of missing that crucial link. I would be prepared to accept an early corporation tax deduction where that is clearly linked to the aims of the share incentive plan legislation. That would mean that shares would need to be distributed to employees through the share incentive plan over a defined period. If he can accept those amendments as well, the Government can be satisfied that his proposals fit squarely with and support the actions that we have already taken.
  I share my hon. Friend's aim of encouraging employee participation and share ownership. None the less, I have had to conclude that, in some respects, the Bill as it stands would work against the purposes and design of the current share incentive plan. I do not believe that the plan is the right vehicle for achieving collective employee share ownership, because its purpose is to increase productivity through direct individual employee shareholding. Nevertheless, I would be prepared to support an amended Bill along the lines that I have set out.
  First, I would support a Bill in which clause 1(2) to (4) and clause 1(7) were dropped. As I explained, those provisions seek to extend the share incentive plan to company structures that cannot currently use it. Secondly, clause 1(6) would need to be amended so that the shares acquired with up-front corporation tax relief were distributed to employees within a defined limit.
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  I am satisfied, having taken advice, that no human rights, European Community or devolution issues would be raised by the amended Bill that I propose. We believe that the impact on the regulatory burden, which was mentioned by the hon. Member for Chesham and Amersham is negligible. None the less, officials will do further work on the shape of the Bill and on assessment.
  I hope that my hon. Friend will accept the amendments that I propose so that I can accept the progress of the Bill into Committee, where the issues can be sorted out. Again, I congratulate all hon. Members who participated in the debate, which was an excellent example of how Government policy can be probed in the House—and, indeed, improved a little—in a spirit of co-operation.
  1.57 pm
  Mr. Lazarowicz: I thank the Paymaster General for her support of significant elements of the Bill and welcome her commitment to continue considering ways of trying to reach what I think is an agreed objective on giving some advantages to employee trusts, which is one of its aims. I accept the validity of the concerns that she expressed, and not just because it is sometimes wise for Back Benchers to accept the Government's concerns on matters of this nature. Even with the assistance that I have had in drafting the Bill, I do not claim that it is a model of ultimate perfection. The tax system is a complex area. I fully accept the concerns that she and other hon. Members have raised. For that reason, I accept that amendments will have to be made in Committee to give effect to the changes that she outlined. On that basis, I hope that the House will give the Bill its Second Reading. Like the Minister, I thank hon. Members throughout the Chamber for the support that they have shown today.
  Question put and agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 63 (Committal of Bills).

  Public Right of Planning Appeal Bill
  Order for Second Reading read.
  To be read a Second time on Friday 25 January.

  National Heritage Bill [Lords]
  Order for Second Reading read.
  2 pm
  Sir Sydney Chapman: I beg to move, That the Bill be now read a Second time.
  The Bill has three principal objectives. First, it would remove some anomalies in the power and functions of English Heritage. Secondly, it would acknowledge that English Heritage merged with the royal commission on historical monuments of England in 1999. Thirdly, it would implement some of the uncontroversial proposals in the 1996 Green Paper, "Protecting our Heritage", which was published by the previous Conservative Government.
  The Bill originated in the other place, where it was promoted by Baroness Anelay of St. Johns. It received its Second Reading on 31 October and was in Committee in the other place on 14 November, when it reported with one amendment, which the Baroness moved.
  Mr. Eric Forth: I hope that the Bill will make good progress. In the short time available, will my hon. Friend assure us that, although it appears substantial, he is satisfied that the content is uncontroversial, and that we will be able to scrutinise it adequately in Committee?
  Sir Sydney Chapman: Although the Bill deals with important matters, it consists of only eight clauses. The eighth deals with commencement, a technical matter that is included in every Bill. The record of the debates in another place shows that the Bill has been scrupulously examined.
  The Bill would put on the statute book proposals that the previous Conservative Government initially presented. Its contents were included in a Bill that the Government introduced in the last Session of the last Parliament. I hope that my right hon. Friend is satisfied with that reply.
  The Bill has all-party support, and I shall deal generally with the eight clauses. Clauses 1, 2, 3 and 6 would transfer responsibility for underwater archaeology from the Department for Culture, Media and Sport to English Heritage. That responds to the overwhelming wish of many organisations, professions and amateur marine archaeologists. The aim was universally accepted in consultations on the 1996 Green Paper, "Protecting our Heritage", to which I referred earlier.
  Hon. Members know that the seas around Britain contain a wealth of archaeological sites and remains. I hazard the opinion that the density of wrecks around our shores is the highest in the world.
  I shall deal briefly with clauses 4 and 5. Clause 4 covers the trading functions of English Heritage and enables that organisation to produce souvenirs that relate to ancient monuments and historic buildings only in England, where English Heritage's remit runs.
  Clause 5 would empower English Heritage to offer its services and expertise outside the United Kingdom. Hon. Members will know that the National Heritage Act 1983 restricts the commercial activities of English Heritage to England. It is common sense to allow it to deal in services and offer its expertise outside the United Kingdom.
  Mrs. Cheryl Gillan: Will my hon. Friend humour me by telling me whether any
  584
  commercial gain resulting from the Bill might be passed on to any of our excellent universities that carry out first-class archaeological work? I am thinking of Bristol university, in particular, which has an eminent archaeology department. If there were some way in which our heritage could help to bring extra funds into our academic institutions—which provide their services not only in this country but throughout the world—there could be spin-offs that my hon. Friend has not thought of.
  Sir Sydney Chapman: I cannot give my hon. Friend a categorical, definitive answer, but I would judge that, if clause 5 were enacted, archaeological interests throughout the country, including universities, would indirectly be helped. The reason why I dare to suggest that is that English Heritage is funded by the taxpayer, but the amount of its funding depends on how much it earns from other sources. Presumably, the more it earns from other sources, particularly—as clause 5 would allow—from outside the United Kingdom, the less the Government will have to give it in grants. Alternatively, English Heritage would have more resources to give grants to universities. Either way, the prospect will be brighter for supporting archaeological interests if the Bill goes through.
  Clause 7 seeks to empower English Heritage to delegate functions if it has the finance available for a project, but not the personnel. This is a rather technical clause, but it is common sense that, if English Heritage does not have the personnel available to help with some project, it should be able to offer its finances to other reputable organisations to carry out the research or whatever work might be involved. Clause 8 covers the usual technical details relating to the commencement and extent of the Bill.
  I understand from my research and that of Baroness Anelay of St. Johns that all the organisations directly affected by the Bill seem to support its provisions. The two principal organisations affected are English Heritage and the Advisory Committee on Historic Wreck Sites. Both fully support the Bill.
  Mr. Edward Davey: The hon. Gentleman says that those organisations are in favour of the Bill. Does he know whether they have received assurances from the Department for Culture, Media and Sport about whether the budget that currently resides in the Department will be sent down to English Heritage to ensure that its funding is not cut? English Heritage is at present unable to fund some very valuable projects throughout the country—for example, repairs to Kingston parish church in my constituency—because of constraints on its budget. If this transfer of responsibilities were to result in its budget being eaten into by further responsibilities, without a transfer of additional funds, some of us might be a little more concerned than the hon. Gentleman suggests.
  Sir Sydney Chapman: It is not for me to give the categorical assurance that the hon. Gentleman seeks, because I do not happen to be in the Government, and only the Government can be answerable. I understand, however, that the DCMS is anxious for the Bill to be passed. It feels that English Heritage is the right authority to deal with such matters. If we cannot secure the

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  guarantees sought by the hon. Gentleman on Second Reading, I am sure we shall be able to ask for them in Committee.
  Mrs. Gillan: In another place, the Minister dealing with the Bill said:
  "In conclusion, the Bill is a valuable and useful piece of legislation, and I am grateful to the noble Baroness, Lady Anelay, for introducing it. It will give English Heritage the opportunity to export its expertise and also to generate more income … Once again, perhaps I may say how pleased I am to be able to offer the support of the Government."—[Official Report, House of Lords, 31 October 2001; Vol. 627, c. 1497–8.]
  Is it not disappointing that no DCMS Minister is present to—obviously—support the Bill? It is a great shame. The Under-Secretary of State for Health, the hon. Member for Pontefract and Castleford (Yvette Cooper), who is present, knows that the Government support the Bill; she must be a bit chagrined.
  Sir Sydney Chapman: I see one extremely attractive member of the Government, and another member of the Government, on the Front Bench. I am immodest enough to declare a certainty that my subliminal powers of persuasion will reach the Government, even if no DCMS representative is physically present.
  Ms Claire Ward: The hon. Member for Chesham and Amersham (Mrs. Gillan) may well have forgotten that, in this Government, Ministers are able to deal with a range of issues. I am more than sure that my hon. Friend the Under-Secretary of State for Health will be able to deal with this matter, on the Government's behalf, as capably as any DCMS Minister.
  Sir Sydney Chapman: I do not know whether I am referring to one or to both Ministers involved, but I know that if the Bill is given a Second Reading a money resolution will be needed, so I will do all that I can to be polite to Ministers—especially Treasury Ministers.
  I have no doubt, given all that was said in the other place, that the Bill has all-party support. It reflects the last Conservative Government's views, as declared in the 1996 Green and White Papers. Moreover, I think its exact provisions were included in the present Government's Culture and Recreation Bill, introduced in the last Session of the last Parliament. I gather that the Government did not proceed with the Bill because they wanted to run for cover and call a general election.
  Ms Debra Shipley: I have two interests in the Bill. A long time ago I wrote a book for English Heritage, so I have intellectual property rights in that regard; and I am a member of the Select Committee on Culture, Media and Sport. Would English Heritage be allowed to consult other expert groups, and would it be given money enabling it to perform functions that it could not otherwise perform owing to a lack of expertise or personnel? If something exciting and wonderful was discovered, what would happen in terms of the commission's exploitation of intellectual property? Will the hon. Gentleman expand on the two relevant clauses, and how they would work?
  Sir Sydney Chapman: I recognise the hon. Lady's interest in these matters. I trained as an architect because
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  I moved down the alphabetical list, and could not remember how to spell "archaeology". Clause 7 would act as a long stop. It would apply only in those cases where specific expertise or action was needed. English Heritage might not have the personnel, or they might be working on other things, but it would have the power to give grants to other organisations to complete work that might be highly specialised. That is certainly an aspect that we can explore in Committee.
  Ms Shipley: I thank the hon. Gentleman for that clarification. My point may indeed be one for Committee, but how would the provision affect intellectual property rights? If an individual, or a group of individuals, has undertaken work, who would own those rights? There is a discrepancy in the provision.
  Sir Sydney Chapman: I apologise to the hon. Lady for misunderstanding her question. I must brazenly say that I cannot give her a definitive answer. I think that the work would be subcontracted and that, as the finance would be provided by English Heritage, it would own the intellectual property rights. I shall certainly find out and write to the hon. Lady, or we may be able to deal with the point in Committee.
  The Bill would put underwater archaeology on the same basis as land archaeology and bring it within the remit of English Heritage. It would enable English Heritage to take over the running of the secretariat of the Advisory Committee on Historic Wrecked Sites. Indeed, that committee fully welcomes that provision.
  The Bill would give English Heritage the right to sell its expertise abroad at a commercial rate, produce souvenirs and exploit its intellectual property. The measure would assist the formal merger of the Historic Buildings and Monuments Commission for England—which has already merged with English Heritage—with the royal commission on the historical monuments of England into a single national body for the built heritage. In fact, those bodies have already been merged administratively.
  For those reasons, I commend the Bill to the House. I hope very much that Members will feel able to give it a Second Reading.
  2.17 pm
  Shona Mclsaac: As a member of the all-party archaeological group, I am delighted to speak in this debate. I wholly support the Bill introduced by the hon. Member for Chipping Barnet (Sir S. Chapman). It is entirely common sense to put marine archaeology on the same footing as land-based archaeology. There has been a mismatch for many years.
  The waters around the United Kingdom are among the richest in the world for archaeology, especially as regards wrecks—to which the Bill refers. Around our coast, there are some Viking wrecks and Spanish wrecks from the time when the armada was scuttled. Such wrecks are to be found in many parts of UK waters, especially in Scotland. We all recall the raising of the Mary Rose. That vessel still provides us with a vast amount of information on the shipbuilding of its period.
  When the Bill is in Committee, I hope that we may be able to address the fact that many wrecks are also graves. The Bill deals with archaeology, and it will not be long

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  before some of the battleships sunk during the first world war can be examined as archaeology. However, in the minds of many people those ships are also war graves and we must consider that point in Committee.
  When we consider the scientific aspects of underwater archaeology, we sometimes underestimate its importance, as regards not only wrecks but towns, and so on. After the last ice age, sea levels rose when the ice melted and many cities and villages were flooded. I was intrigued to hear today that a city about 9,000 years old has been discovered off the coast of India. Although the Bill will not affect that, it will revolutionise our thinking on the origin of cities. That is part of underwater archaeology, and it will be a new area of exploration in future.
  I am glad that the Bill has been introduced, because it will put lost underwater villages on the same footing as the ancient villages that are protected by English Heritage on land. I hope that the Bill receives a Second Reading and rapidly becomes law.
  2.20 pm
  The Parliamentary Under-Secretary of State for Health (Yvette Cooper): I shall keep my remarks as short as possible. On behalf of the Government, I welcome the Bill. We give it our wholehearted support. The substance of its provisions was contained largely in the Government's Culture and Recreation Bill, which was introduced in another place in December 2000 but was unable to complete its parliamentary passage before the general election was called, so, unfortunately, the provisions contained in this private Member's Bill were lost at that time.
  The changes that the Bill would effect are needed. The Government are very pleased that these provisions have been given a second chance, because broadening the powers of English Heritage to allow it to export its goods and services abroad and to take on work associated with underwater archaeology will be of great benefit not only to English Heritage but to the historic environment and the heritage sector.
  I can assure the House that these provisions have been subject to a number of extensive consultations. They have also received a very positive response from a wide range of heritage organisations. The devolved Administrations are content with the Bill and considerable consultation has taken place with Ministers and officials in those Administrations.
  English Heritage was established in 1983 by the National Heritage Act 1983, which restricts the activities of English Heritage exclusively to ancient monuments and historic buildings situated in England, yet there is a demand from overseas for English Heritage's expertise, goods and services. We know that England is noted for its cultural heritage. English Heritage is itself a leading brand name and the organisation is respected throughout the world for its expertise, skills and experience in the management, conservation and restoration of the historic environment, but at present it has to turn away requests to use that expertise in foreign countries.
  The Bill's overseas trading provisions, like those in the Culture and Recreation Bill before it, will therefore enable those skills to be shared with a wider audience—for example, by creating the opportunity for English Heritage to sell products and services around the world—and will
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  create export opportunities for other English suppliers and contractors in the heritage field who are keen to benefit from English Heritage's lead.
  The underwater archaeology provisions of the Bill arise from the fact that the 1983 Act and the Ancient Monuments and Archaeological Areas Act 1979 do not give English Heritage any powers to act below the mean low water mark. As hon. Members have said, that obviously leaves an anomaly whereby English Heritage cannot perform the functions for underwater archaeology that it can for land-based archaeology, whether it be the provision of educational facilities and services or public information and advice or the making of contributions to research costs and grants, to name but a few.
  It is not possible at the moment for the Secretary of State for Culture, Media and Sport to direct English Heritage to carry out certain administrative functions in relation to underwater archaeology. To allow English Heritage similar involvement with underwater archaeology to that which it has with land-based archaeology would permit considerably more expertise to enter the management and decision-making process in connection with underwater archaeology.
  The Bill is valuable and useful. It will give English Heritage the opportunity to export its expertise and generate more income and it will create opportunities for small private sector organisations to penetrate overseas markets. It will place underwater archaeology on the same footing as land-based archaeology and, most important, it will further enhance English Heritage's status as the lead body in the sector.
  I repeat that I am pleased to offer the Government's support for this private Member's Bill.
  2.24 pm
  Mrs. Cheryl Gillan: I shall not delay the House, except to rise in support of the Bill and to say that, despite the United Kingdom's rich maritime history and in contrast to what happens in Scotland, Northern Ireland and Wales, English Heritage—the lead agency for managing physical remains and the historical environment in England—is not responsible for marine archaeology; the Bill will redress that situation.
  At the moment, we are failing to act to protect our national historical heritage, and the Bill introduced by my hon. Friend the Member for Chipping Barnet (Sir S. Chapman) will correct that. I am delighted that the Government and all the hon. Members who have spoken so far in this brief debate wish the Bill well and hope that it receives its Second Reading. I hope that the House will allow the Bill to be debated in Committee.
  2.25 pm
  Mr. Eric Forth: I want to add just a brief word in support of the Bill, which my hon. Friend the Member for Chipping Barnet (Sir S. Chapman) has so skilfully steered to this stage of its proceedings. It is now pretty obvious that he has persuaded the House of the Bill's merit, and time has fortunately permitted a debate to take place. The Bill was considered fully in another place, as he said, so we can look at it from our perspective in the light of that knowledge.
  I very much welcome, for example, clause 4 on the new trading functions of the commission. The Bill has been widely welcomed, and there is no doubt that it will allow

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  the great inherent strengths of our heritage to be fully exploited—in the best possible meaning of that word. However, I want to put down a tiny marker, which hon. Members may want to consider in Committee.
  I am always interested when a Bill contains provisions such as those in clause 3(2), which states:
  "If the Secretary of State directs the Historic Buildings and Monuments Commission … to exercise functions … the Commission shall exercise them."
  It looks as though the Minister, even in these provisions—welcome as they are—was not quite able to let go, but perhaps that can be considered in Committee, and it is proper that the Committee should do so. All in all, the Bill, which started in another place, has been debated here and has received a widespread welcome, and I wish it well.
  Question put and agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 63 (Committal of Bills).

  THE SPEAKER'S ABSENCE
  Ordered,
  That the Speaker have leave of absence on Tuesday 22nd January to attend the funeral of a close personal friend.—[Jim Fitzpatrick.]

  Mitcham Cottage Hospital
  Motion made, and Question proposed, That this House do now adjourn.—[Jim Fitzpatrick.]
  2.27 pm
  Siobhain McDonagh: I am pleased to have secured this debate on an issue that is very dear to the hearts of my constituents—the future of the former Mitcham cottage hospital, the Wilson. It is no exaggeration to say that I speak for virtually all my 70,000 constituents—no matter what their politics—when I say that they would dearly love the Wilson to re-open its doors as a hospital. It is also no exaggeration to say that the people of Mitcham had, and still have, a strong and proud affection for the Wilson—it was, and is, cherished.
  I can do no better to sum up the feelings of Mitcham people than to quote from a handful of the huge number of supportive but unsolicited letters that I have received since I took up the issue in December. Mr. John Brett of Imperial Gardens, Mitcham wrote:
  "Having been born in Mitcham 75 years ago I know what an asset it would be for local people, especially the elderly as patients and visitors. I am sure that the growth in Mitcham's population warrants the need for the Cottage Hospital."
  Mrs. J. M. Collins of Fenning Court, Mitcham wrote:
  "I am behind you 100 per cent. It should never have been closed. I have been a patient of the Wilson having had both my hips replaced and received the best of care and attention. I cannot speak highly enough of the surgeons, doctors and nursing staff that attended me."
  Mrs. Marie Patterson of Sherwood Park road, Mitcham, wrote:
  "It would certainly be handy for the elderly of the borough who now have at least two buses to catch to get to any hospital for treatment."
  Mrs. Helen Manning-Legg of Commonside East, Mitcham, wrote:
  "Congratulations on initiating the debate for giving the Wilson Hospital back to the people for whom it was a gift! For years we have felt cheated, and in the beginning we fought to keep it open. You have our full support."
  It being half-past Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.
  Motion made, and Question proposed, That this House do now adjourn.—[Jim Fitzpatrick.]
  Siobhain McDonagh: Dr. Alan Cohen, a local GP and chair of the East Merton and Furzedown primary care group, wrote:
  "I am sure that it will not surprise you to know that it has been a stated aim of the Primary Care Group since our inception to provide clinical services at the Wilson … The PCG would very much like to put clinical services in the Wilson, but are currently prevented from doing so by the Health Authority insisting on using it for offices".
  The Wilson disappeared off the clinical radar in the closing years of the Conservative Government, becoming offices for Merton, Sutton and Wandsworth health authority. A much-loved and much-used amenity was lost. Desks and filing cabinets replaced beds; offices replaced wards and an operating theatre. Mitcham was stripped of the hospital that Sir Isaac Wilson, a local benefactor, specifically endowed for the people of Mitcham in 1928. Sir Isaac endowed a cottage hospital for the many, not an

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  office block for the few. The current misuse of the building is an affront to his intentions and to the people of Mitcham.
  As a local councillor for 16 years in the 1980s and 1990s, I was involved in the campaign to keep the Wilson open. It was a strong and determined campaign, and we achieved a marvellous amount with next to no resources. In spite of initially being successful in preventing its closure, in the end we failed. We were let down by false promises from Conservative Health Ministers. It has been a constant regret to me that we failed.
  Towards the end of last year, I took up a campaign in my constituency to urge Merton, Sutton and Wandsworth health authority, and the new south-west London strategic health authority, which is poised to replace it, to find alternative office accommodation to clear the way for the re-introduction of clinical services at the Wilson. Not only is the transition from the health authority to strategic health authority the perfect moment to restate the case for the Wilson, but it is crucial to me that the people of Mitcham are not elbowed to the back of the health queue again.
  My campaign includes a petition signed by a large and increasing number of constituents that I plan to present to the House early next month. The campaign has gained eager support from local people of all ages and backgrounds. They include local GPs, and speaking to them has brought home to me the fact that Mitcham—which is part of the East Merton and Furzedown primary care group—is very much a victim of health inequality.
  East Merton primary care group is some £4 million over target compared with Balham, Tooting and Wandsworth primary care group, which is £3 million under target despite similar levels of deprivation. The extra spend comes from the greater use of secondary care services by GPs in East Merton, as there has not been the investment in infrastructure in primary and secondary care from which Wandsworth has benefited so much.
  Mitcham has the highest rate of teenage pregnancies and low birth weight pregnancies in the area covered by Merton, Sutton and Wandsworth health authority. Sadly and probably amazingly, Merton has the highest number of children put up for adoption in London. According to 1996 figures, Phipps Bridge ward, in which the Wilson stands, had the highest adult mortality rate in the borough.
  Clearly, as well as crying out for the restoration of hospital facilities, there is much to be done to address the very real and disturbing health inequalities that people face in this area of my constituency. I understand that the public health department has been encouraged by local GPs to investigate the inequity between East Merton primary care group and Balham, Tooting and Wandsworth primary care group but, over the last two years, it has been unable to do so. Perhaps my hon. Friend the Minister would offer some help to hard-pressed GPs in my constituency on this point.
  My main objective in this debate is to ask my hon. Friend to offer an undertaking to my constituents in Mitcham and Morden that an option appraisal of intermediate care services in Merton can be carried out to assess the viability of reopening the Wilson as an intermediate care centre and as an extension to the intermediate care service, thereby serving the elderly and the infirm in the Mitcham area who are in need of hospital care.
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  All hon. Members are aware of the colossal pressure on our large NHS hospitals, such as St. George's in Tooting and St. Helier in Carshalton, both of which serve my constituents. The Wilson is equidistant between the two and could ease the pressure on acute beds in both. Indeed, many former cottage hospitals nationally could be pressed back into use to ease the pressure on acute hospitals and to provide care for the elderly who cannot be cared for in their homes.
  I fully realise that there is an on-going debate on how best to deliver intermediate care—whether it should be in the patient's home or in dedicated beds at a resource such as a cottage hospital, which the Wilson has the potential to be. I understand from talking to local GPs that current evidence indicates that care at home with intermediate care nursing teams is probably more effective and better liked by the user of the service. I believe that encouraging independence by providing care in the home is absolutely right.
  There are circumstances, however, when respite beds are necessary, for instance when a patient's home circumstances may be unsuitable, or when patients are suffering from dementia or some other severe infirmity that means that they need clinical care 24 hours a day. The Wilson could come into its own in those circumstances, relieving pressure by relieving bed blocking.
  Considerable work has been done in the Merton, Sutton and Wandsworth area on intermediate care services. A domiciliary provider team currently managed by South West London Community NHS trust and five residential home beds with rehabilitation services attached are available to support the discharges of Merton patients from St. Helier hospital.
  There are between 40 and 55 delayed transfers of care each week from St Helier, the split between Sutton and Merton residents being approximately two thirds and one third respectively. The most significant group that experiences those delays in both boroughs is composed of patients who are waiting for long-term nursing home or residential care. Intermediate care services in their current form would not provide an appropriate level of service for that group of patients. Additional intermediate care beds, with the appropriate rehabilitation input, would, however, undoubtedly allow the trust to discharge some patients much more speedily. That could happen at the Wilson.
  In respect of intermediate care needs at St George's, a recent study on such care identified a need for 60 to 70 intermediate care beds across the Merton, Sutton and Wandsworth area. For the area that St. George's covers in Battersea, at least 16 intermediate care beds are needed and the hospital has forwarded a proposal to the Department of Health to expand the intermediate care provision at the Bolingbroke hospital. Such intermediate care provision could also be provided at the Wilson.
  On alternative offices for the health authority, I certainly would not want to hound the new strategic health authority out of Mitcham and Morden. I am pleased that such an organisation wants to have its base in my constituency. I acknowledge the good work done by the health authority and the work that its successor body will no doubt do. This is not about the individuals who have their office at the Wilson, but about the fact that that should not be at the expense of a hospital to serve the people of Mitcham.

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  I have done some research into the office accommodation available in Merton that is of a sufficient size—more than 1,000 sq ft—to house the new strategic health authority, its support groups and the primary care trust that will be co-located with it. With a bit of imagination and, more importantly, the will to move, the health authority could find office accommodation within a few miles of the Wilson. I hope that Merton's Labour council will assist the health authority to find a new home, just as it has made strenuous efforts to help Wimbledon football club find a site for a new stadium. For instance, the partially empty Brown and Root tower in Colliers Wood, just opposite Colliers Wood tube station, has more than enough space for the health authority. More controversially, perhaps, there is space in the soon-to-close Rowan school in Longthornton, which is a fine building in need of a new use. There are others, too.
  I ask the Minister to give an undertaking to my constituents, the people of Mitcham and Morden, that an option appraisal of intermediate care services in Merton will be carried out to assess the viability of reopening Wilson hospital as an intermediate care centre. I further ask her to take steps to deal with the inequity between local primary care groups.
  I have spoken a lot about the feelings of the people of Mitcham. As someone who has lived in the constituency all my life, I share their feelings. Mitcham has suffered over the years as its facilities and its civic pride have taken a battering. Reopening the Wilson would be a tremendous boost for Mitcham. It would give an entire community great pleasure to see it reopened for the purpose for which it was intended. Sir Isaac Wilson never intended to endow an office block. I therefore strongly urge the Government to respect his wishes, and the wishes of my constituents in Mitcham.
  2.40 pm
  The Parliamentary Under-Secretary of State for Health (Yvette Cooper): I congratulate my hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) on securing the debate. She has made a powerful case on behalf of her constituents about Wilson hospital and about tackling health inequalities in her area. In the wake of our recent consultation on how to narrow health inequalities across the country, I will happily talk to her further about specific issues that she, general practitioners and in particular her constituents face.
  The main subject of my hon. Friend's speech was the future of Wilson hospital. I welcome the opportunity to discuss the future of a facility that, as she has made clear, is strongly valued by her constituents.
  As my hon. Friend will be aware, responsibility for deciding what services are provided in Mitcham rests with the local NHS in south-west London. The key decisions must be taken locally and with proper public consultation where appropriate. Nevertheless, I will respond to her as far as I can about the issues that she has raised, the local position, and how it fits in the context of the national approach to intermediate care.
  Clearly, the issue is important to my hon. Friend's constituents. As she said, Wilson hospital, which was established as a cottage hospital by Sir Isaac Wilson in 1928, was a gift to the local community.
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  In 1990, following consultation, it was agreed that in-patient services at the Wilson be transferred within the district, in line with the previous Government's policy. By that time, the Wilson was offering mainly out-patient services and elective orthopaedic surgery, and had some elderly in-patient beds. Many of the services were transferred to Sutton hospital, part of the current Epsom and St. Helier NHS trust. During that time, the district headquarters, now the Merton, Sutton and Wandsworth health authority, was searching for new accommodation, so it moved into the empty space at the Wilson.
  A health clinic still serves local residents. It offers dental services, a blood clinic and district nurse and health visitor services for the South West London Community NHS trust. The Merton community mental health team is also based on the site. I am aware of local concern about the future of the site and have been very impressed by the strong community feeling on the issue.
  My hon. Friend is right to stress the value of local cottage hospitals. The Government are committed to making appropriate and effective use of those community services. There is an important role for cottage hospitals in the delivery of local health care and in the future development of intermediate care.
  In the NHS plan, we pledged that, as well as additional money, by 2004 there would be 5,000 extra intermediate care beds across the country. Some of those will undoubtedly be in cottage hospitals, some in existing facilities and some in new developments. I agree that often the potential of such hospitals has been ignored. Now, with a new emphasis on intermediate care and delivering care "closer to home", there is an opportunity to breathe new life into local services.
  The NHS plan announced extra investment of £900 million annually by 2003–04 for intermediate care and related services to promote patient independence, of which around one quarter was earmarked specifically for NHS investment in intermediate care. With the £150 million made available recurrently from the previous financial year, that will bring earmarked NHS resources for intermediate care to a total of £405 million by 2003–04.
  A substantial component of that money is to be provided to local government for a range of services to link to intermediate care—for example, through the provision of home care, giving people enough day-to-day help to enable them to live in their own home rather than have to remain in hospital or nursing care. The results of a survey on intermediate care undertaken in August last year show that good progress is already being made. From a baseline of 1999–2000, there will be 2,400 more intermediate care beds by the end of this year. Of course, there is still progress to be made. Our aim now must be to ensure that everyone has access to high-quality, effective intermediate care services.
  Locally, Merton, Sutton and Wandsworth health authority, Merton social services and the proposed Sutton and Merton primary care trust have been working closely together to increase intermediate care provision. There are currently 31 intermediate care beds for Sutton and Merton residents and 10 beds for Wandsworth residents. Intermediate care provision for Merton residents includes beds for elderly people at Bolingbroke hospital, which is part of St. George's Healthcare NHS trust, as well as beds at Eltandia nursing home and Carshalton War Memorial

  595
  hospital. Earlier this month, Merton social services received £248,000 from money allocated to councils to reduce the number of delayed transfers of care, and it has developed a plan with local partners to use the funding to offer older people more opportunities to return to or stay in their own home—for example, through the provision of additional home care arrangements.
  Together, local NHS and social care organisations will develop a more detailed strategy on intermediate care over the next 12 months. Current estimates of need suggest that a minimum of nine additional beds plus additional community placements will be required by 2003–04 for Sutton and Merton residents, although projections are still being reviewed. To meet that need and to reach targets for intermediate care, the health authority, social services and the PCT will need to consider all the options, including enhancing home support as well as providing additional beds in the area.
  It will be for the NHS at local level to decide how and where services should be provided and how best to use local NHS resources, but it is important to involve the local community in discussions on those matters and to take account of local people's views. I am sure that my hon. Friend agrees that there is also a need to take into account issues of clinical viability, accessibility for patients, and cost-effectiveness for the NHS, so that the NHS can provide the best possible services across the board.
  My hon. Friend will be aware that some of the changes resulting from the NHS plan and "Shifting the Balance of Power" announced by the Secretary of State last year were about putting patients and staff at the heart of the NHS and moving power from Whitehall back to those on the front line. The key aim is to reshape the NHS around the needs of its users, to offer them choices and to involve them in decision making and planning. That is key to the discussions that must take place locally and involve local communities, as well as discussions with local authorities,
  596
  the voluntary sector and other key partners. To create a more responsive health and social care system built around the needs of local communities, patients, front-line staff and local people must be involved in consultation.
  My hon. Friend mentioned the fact that the Wilson is currently used for office accommodation. The proposed Sutton and Merton PCT is in need of headquarters office accommodation. That is currently under review, and I am advised that the Wilson is one of the sites being considered. She will be aware that, because the Wilson is not in the commercial sector, the cost of providing offices there is considerably lower than that of leasing commercial premises; that is one of the factors that must be taken into account locally. That will also be a factor in the considerations of the new strategic health authority.
  How far facilities may need to be Modernised will also have to be considered. If the Wilson were to be considered as a cottage hospital in the way that my hon. Friend and the community suggest, there will be concerns about the costs associated with Modernising the building to the standards expected today for clinical services. Such factors must be taken into account by the local NHS when considering the future of the services in the area.
  I have listened carefully to the points made by my hon. Friend, who spoke clearly and happily on behalf of her constituents. Merton, Sutton and Wandsworth health authority welcomes her interest in the matter and would be happy to discuss it further.
  As far as possible, discussions and decisions must take place at the local level, but we shall take a continued interest in the discussions that my hon. Friend has at that level. I shall be happy to discuss the matter further with her when local discussions have taken place about the development of intermediate care in her area and the Wilson hospital.
  Question put and agreed to.
  Adjourned accordingly at nine minutes to Three o' clock.

INTERNATIONAL DEVELOPMENT

  Pan-African Tsetse and Trypanosomiasis Eradication Campaign
  Mrs. Spelman
  To ask the Secretary of State for International Development if she will make a statement on the Pan-African Tsetse and Trypanosomiasis Eradication Campaign. [27759]

  Clare Short
  DFID recognises that Trypanosomiasis is a major constraint to human health and to the livelihoods of poor livestock keepers throughout many parts of Africa. We have made considerable investments (over £37 million) to develop methods to control the disease in livestock and we support the World Health Organisation in its efforts to control sleeping sickness in humans.

  The long-term goal of the Pan-African Tsetse and Trypanosomiasis Eradication (PATTEC) is to eradicate tsetse fly from the continent. It is a complex and ambitious programme that would require many billions of dollars to implement, and is founded on as yet unproven scientific and economic theory.

  Our analysis—shared also by the European Commission—is that it will not be possible to eradicate tsetse flies from Africa. The aims of the campaign are laudable, but we do not believe that they are achievable.

  Our strategy is to promote methods for controlling the tsetse fly and preventative and curative methods of treatment that can be readily implemented by poor people themselves. We have programmes of support with the Inter-African Bureau of Animal Resources of the African Union, and with the Food and Agriculture Organisation of the United Nations, to promote the establishment of sustainable animal health services that provide poor people with the means to control tsetse fly and the disease it carries.

  Where the political will for control exists, and where there are clear social benefits, a regional approach to tsetse control may be justified. Such large scale programmes would however be best handled through multilateral channels such as the EC, and not by bilateral agencies such as DFID.

  Burkina Faso
  Norman Lamb
  To ask the Secretary of State for International Development if she will make a statement on the situation in Burkina Faso regarding the incidence of HIV cases; and what assistance has been provided by her Department in each of the last five years. [28621]

  Clare Short
  Burkina Faso has the second highest HIV/AIDS infection rate in west Africa, the UN estimating the adult prevalence rate as being 6.4 per cent. at the end of 1999. The Burkinabe Government are strongly committed to tackling HIV/AIDS through a comprehensive national 486W
  strategy, and are working in partnership with neighbouring countries to contain the epidemic. Last month Burkina Faso hosted the 12th International Conference on AIDS and sexually transmitted diseases in Africa.

  DFID does not have a substantive aid programme to Burkina Faso, and has not provided direct support for any projects linked to HIV/AIDS over the last five years. However, we fund such work indirectly through our contributions to international agencies—UNAIDS supports regional work to strengthen the response to HIV/AIDS throughout Africa, and the World bank's $500 million Multi-Country HIV/AIDS Program for the Africa Region (MAP) includes $22 million for Burkina Faso to help the Government expand access, particularly for vulnerable groups, to prevention, care and treatment.

  Norman Lamb
  To ask the Secretary of State for International Development how much development aid was provided to Burkina Faso by the UK in each of the last five years. [28620]

  Clare Short
  DFID does not have a development programme in Burkina Faso. Small-scale funding has been available from the small grants scheme and the civil society challenge fund (and its forerunner). Details of DFID grants in aid and in kind are as follows:

  £

  1996–97

  204,000

  1997–98

  156,000

  1998–99

  305,000

  1999–2000

  267,000

  2000–01

  234,000

  In addition the UK provided debt relief of £430,000 in 1997–98.

  The EC maintains a substantial development assistance programme to Burkina Faso. The calculated estimate of the proportion attributable to UK contributions over the years 1995–99 (the last year for which we have data) is as follows:

  £million

  1995

  7.4

  1996

  4.5

  1997

  5.7

  1998

  7.0

  1999

  6.3

  Departmental Transport
  Mr. Bercow
  To ask the Secretary of State for International Development what her estimate is of the cost of(a) ministerial cars and drivers and (b) taxis for her Department in each of the last four years. [27906]

  Clare Short
  The estimated cost of(a) ministerial cars and drivers and (b) taxis for my Department in each of the last four financial years is:

  £

  (a)

  (b)

  1997–98

  257,247

  71,185

  1998–99

  290,081

  55,144

  1999–2000

  270,654

  57,118

  2000–01

  212,114

  78,308

  Zimbabwe
  Norman Lamb
  To ask the Secretary of State for International Development if she will make a statement on the situation relating to the distribution of food aid in Zimbabwe; and on what development assistance from the United Kingdom is being spent. [28434]

  Clare Short
  The prospect of food shortages in Zimbabwe has been clear for a long time. NGOs have planned ahead, including purchasing food, and have been operating supplementary feeding programmes since September 2001. DFID has committed £4 million for food and logistics support for programmes run by NGOs. We are monitoring these activities carefully and working with the NGOs and other donors to help ensure their success. We are satisfied that, at present, they are still able to work effectively.

  The World Food Programme is now beginning food aid operations in Zimbabwe as a part of the UN Humanitarian Assistance and Recovery Programme. WFP will transport food within Zimbabwe, and will also work through NGOs to deliver food at the community level. DFID has pledged a further £3.5 million to WFP for food and logistics support.

  Export Credits Guarantee Department
  Mr. Lilley
  To ask the Secretary of State for International Development what was the value of trade credits guaranteed by the ECGD for sales of military equipment to highly indebted poor countries in each year since 1983. [25240]

  Ms Hewitt
  I have been asked to reply.

  The value of ECGD cover for defence business in each of these years for countries currently classified as HIPCs (Heavily Indebted Poor Countries) is as follows:

  £million

  Year

  Value of ECGD cover

  1984–85

  102.8

  1987–88

  20.1

  1988–89

  49.2

  Total for all years since 1983

  171.2

  For years not listed the total value of ECGD cover was £0.

  Not included in the table is cover provided by ECGD's short-term operation which was privatised in 1991. More generally ECGD's records of business supported prior to 1 April 1987 are no longer comprehensive.

HOUSE OF COMMONS

  Mr. John Stonborough
  Peter Bottomley
  To ask the hon. Member for Roxburgh and Berwickshire, representing the House of Commons Commission, when and for what purpose Mr. John Stonborough was engaged by the House of Commons Commission; what the selection process was; and when the need for advice on media relations was identified. [27263]
  488W
  Mr. Kirkwood
  Mr. Stonborough was engaged with effect from 20 December 2001 to provide the House of Commons Commission with advice on media relations generally, and on long-term information strategy. The commission chose him at its meeting on 18 December 2001. The need for a corporate approach to media matters was identified in the Braithwaite Review of Management and Services (HC745) published in July 1999. This led to the appointment of a communications adviser in the Office of the Clerk in 2000. Mr. Stonborough's engagement represents a further step in that direction.

TRANSPORT, LOCAL GOVERNMENT AND THE REGIONS

  Abandoned Housing
  Mr. Gordon Prentice
  To ask the Secretary of State for Transport, Local Government and the Regions if he will rank local authorities in England by(a) number and (b) percentage of (i) public and (ii) private housing stock which have been abandoned. [27147]

  Ms. Keeble
  Data on levels of abandonment are not held by my Department. Abandonment arises where a property owner simply walks away or 'abandons' a property. The owner's intentions as well as their actions are therefore relevant and it is difficult to define objectively. However, we do have data reporting low demand, which I have placed in the Libraries of the House.

  Homebuy Scheme
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many people in the constituency of Buckingham have received interest free equity loans under the Homebuy scheme; and what the total amount of funding granted is. [27775]

  Ms Keeble
  The number of people in Aylesbury Vale that have received interest free equity loans under the Homebuy scheme is four.

  1999–2000: 1

  2000–01: 1

  2001–02: 2.

  £

  1999–2000

  24,938

  2000–01

  24,640

  2001–02

  61,320

  Total amount of funding granted

  110,898

  Note:

  The Buckingham constituency is only part of Aylesbury Vale local authority area (albeit the main part) and that part of Aylesbury constituency is also covered within this area. Thus, any loans within the Aylesbury constituency may also be included in the figures.

  Source:

  Notting Hill Housing Association

  Starter Home Initiative
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many people in the Buckingham constituency have benefited from the Starter Home initiative for key public workers; and what is(a) the average amount and (b) the total amount granted. [27778]
  489W
  Ms Keeble
  The Starter Home initiative allocations announced on 6 September 2001 included a scheme to help 272 key workers across Buckinghamshire. The grant that has been allocated to the scheme over the three years 2001–02 to 2003–04 is £6.988 million, averaging £25,199 grant, and £493 administration costs, per key worker. Separate allocations were made to other schemes to help 20 key workers in Aylesbury Vale and 70 in Milton Keynes.

  It is proposed that a further 40 key workers are helped in Buckinghamshire under the bidding arrangements for the Starter Home initiative equity loan scheme announced on 16 January 2002, together with a further 10 in Milton Keynes.

  Information on the number of key workers who have purchased homes under the Starter Home initiative scheme during this financial year will be available towards the end of April 2002.

  Right to Buy
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many homes in the Buckingham constituency were bought under(a) right to buy and (b) right to acquire in each year since their inception; and what the total revenue is generated under each scheme. [27774]

  Ms Keeble
  The information is as follows:

  (a) Information on Right to Buy sales reported by Aylesbury Vale district council since October 1980 is in the following table. The figures include a small number of RTB shared ownership sales and sales under the Rent to Mortgage scheme in the local authority's area, which includes part of the Aylesbury constituency.

  Number

  Selling price (£000)

  1980–81

  17

  n/a

  1981–82

  337

  13,780

  1982–83

  404

  4,771

  1983–84

  427

  5,772

  1984–85

  464

  7,069

  1985–86

  395

  6,190

  1986–87

  455

  8,415

  1987–88

  460

  10,028

  1988–89

  491

  11,791

  1989–90

  247

  7,048

  1990–91

  179

  4,987

  1991–92

  159

  3,868

  1992–93

  151

  3,191

  1993–94

  226

  5,047

  1994–95

  176

  4,378

  1995–96

  121

  2,917

  1996–97

  166

  4,273

  1997–98

  216

  6,066

  1998–99

  159

  4,972

  1999–2000

  204

  6,831

  2000–01

  227

  9,260

  1 Estimate

  Notes:

  1. The total selling price of properties sold under the Right to Buy scheme since April 1981 was £120.65 million. Comparable information for 1980–81 was not collected.

  2. The Buckingham constituency is only part of Aylesbury Vale local authority area (albeit the main part) and that part of Aylesbury constituency is also covered within this area. Thus, any houses within the Aylesbury constituency may also be included in the figures.

  Source:

  DTLR P1 (B) quarterly housing activity returns
  490W
  (b) No homes have been bought in Buckinghamshire under right to acquire.

  Homeless Households
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many homeless households in the constituency of Buckingham have been resident in bed-and-breakfast accommodation in each year since 1997: and what percentage of them claimed social security benefits in each year. [27770]

  Ms Keeble
  Information reported by Aylesbury Vale district council on the number of households resident in bed-and-breakfast hotels under statutory homelessness provision at the end of March in each year since 1997 is shown in the table. This relates to households within the local authority's area, which includes part of the Aylesbury constituency. The number of these households claiming, or in receipt of, social security benefits is not collected centrally.

  Homeless households resident in bed-and-breakfast accommodation1 as at 31 March

  Aylesbury Vale DC

  1997

  6

  1998

  11

  1999

  8

  2000

  12

  2001

  5

  1 Includes households accommodated pending completion of inquiries by the local authority

  Source:

  DETR P1 (E) housing return (quarterly)

  Estates Renewal Challenge Fund
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many projects in the Buckingham constituency have received funding from the Estates Renewal Challenge Fund; and if he will list the beneficiaries. [27779]

  Ms Keeble
  Buckinghamshire received no funding from the Estates Renewal Challenge Fund.

  Council Houses
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many council houses have been empty in the Buckingham constituency in each year since 1997. [27773]

  Ms Keeble
  The number of local authority owned dwellings reported as being vacant in each year since 1997 is as follows:

  Local authority owned dwellings in Aylesbury Vale district council area as on 1 April:

  Vacant stock

  2001

  105

  2000

  131

  1999

  142

  1998

  125

  1997

  118

  A level of vacancy is a usual feature of housing management, reflecting turnover and movement within

  491W
  the stock. There is likely to be some variation in the proportion of dwellings that are vacant in a local authority from one date to another during the year.

  Note that the Buckingham constituency is only part of Aylesbury Vale local authority area (albeit the main part) and that part of Aylesbury constituency is also covered within this area. Thus, any houses within the Aylesbury constituency may also be included in the figures in the table.

  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many council houses there are in the Buckingham constituency; and how many of these are owned by the local authority. [27829]

  Ms Keeble
  The number of 'council' houses in the Aylesbury Vale local authority area at March 2001 is 9,621, of which 8,626 are owned by the local authority.

  Note that the Buckingham constituency is only part of Aylesbury Vale local authority area (albeit the main part) and that part of Aylesbury constituency is also covered within this area. Thus, any houses within the Aylesbury constituency may also be included in the figures provided.

  Source:

  Aylesbury Vale Housing Revenue Account Business Plan 2001–31

  Traveller Sites
  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many(a) local authority and (b) private traveller sites there were in the Buckingham constituency in each year since 1997. [27771]

  Ms Keeble
  The number of local authority traveller sites that were in Aylesbury Vale local authority area in each year since 1997 are shown in the table:

  January

  Number of local authority sites

  2001

  12

  2000

  12

  1999

  2

  1998

  2—

  1997

  2—

  1 Of which one closed February 1999

  2 Data for the number of local authority sites in January 1998 and January 1997 is not held within the Department headquarters and is not accessible within the given time scale

  Source:

  Data from the annual DTLR gipsy return GS2

  Figures for the number of private sites are not collected centrally and thus are not available.

  Note that the Buckingham constituency is only part of Aylesbury Vale local authority area (although the main part) and that part of Aylesbury constituency is also covered within this area. Thus, any gypsy sites within Aylesbury constituency may also be included in the figures provided.

  Mr. Bercow
  To ask the Secretary of State for Transport, Local Government and the Regions how many traveller caravans and families were on(a) authorised and unauthorised sites in the Buckingham constituency in each year since 1997. [27772]
  492W
  Ms Keeble
  Figures for the number of caravans and families on authorised and unauthorised sites in the Aylesbury Vale local authority area for each year since 1997 are reported in the table.

  Caravans

  Families

  Total

  July 2001

  39

  32

  January 2001

  28

  26

  July 2000

  30

  20

  January 2000

  35

  31

  July 1999

  33

  27

  January 1999

  35

  25

  July 1998

  40

  30

  January 1998

  32

  25

  July 1997

  48

  39

  January 1997

  37

  26

  Unauthorised encampments

  July 2001

  19

  14

  January 2001

  8

  8

  July 2000

  13

  4

  January 2000

  16

  15

  July 1999

  19

  16

  January 1999

  9

  3

  July 1998

  9

  7

  January 1998

  2

  1

  July 1997

  16

  115

  January 1997

  8

  4

  Authorised sites:

  Council

  July 2001

  5

  5

  January 2001

  5

  5

  July 2000

  4

  4

  January 2000

  6

  4

  July 1999

  3

  0

  January 1999

  15

  11

  July 1998

  20

  12

  January 1998

  19

  13

  July 1997

  21

  13

  January 1997

  18

  11

  Private

  July 2001

  15

  13

  January 2001

  15

  13

  July 2000

  13

  12

  January 2000

  13

  12

  July 1999

  11

  11

  January 1999

  11

  11

  July 1998

  11

  111

  January 1998

  11

  111

  July 1997

  11

  111

  January 1997

  11

  111

  1 Estimated figure

  Note:

  The Buckingham constituency is only part of Aylesbury Vale local authority area (although the main part) and that part of Aylesbury constituency is also covered within this area. Thus, any caravans or families on gypsy sites within Aylesbury constituency may also be included in the figures provided.

  Source:

  Counts data are from the bi-annual DTLR Gypsy return GSI

  Coastal Erosion
  Paul Flynn
  To ask the Secretary of State for Transport, Local Government and the Regions what assessment he has made of the effects of sand dredging on coastal erosion. [28115]
  493W
  Ms Keeble
  [holding answer 17 January 2002]: Careful consideration is given to all of the environmental implications of marine minerals dredging proposals that are submitted to the Secretary of State. Each proposal is subject to environmental impact assessment that includes a coastal impact study prepared by HR Wallingford. The proposed dredging will be allowed only if the Secretary of State is satisfied that there will be no unacceptable coastal impacts.

  A14
  Mr. Djanogly
  To ask the Secretary of State for Transport, Local Government and the Regions when, upon the Highways Agency completing its preparatory work on the major A14 improvements, included in the preferred plan of the Cambridge to Huntingdon multi-modal study, the scheme will entered into the DTLR's targeted programme of improvements. [27737]

  Mr. Spellar
  I have asked the Highways Agency to carry out preparatory work on the major A14 improvements included in the preferred plan of the Cambridge to Huntingdon multi-modal study with a view to an early entry to the targeted programme of improvements. This work by the Highways Agency began this month with the aim of finishing it within six months, after which a decision will be made on entry to the TPI. Subsequently, public consultation on the route would be expected within 12 months.

  Mr. Djanogly
  To ask the Secretary of State for Transport, Local Government and the Regions whether, in the event of approval of the final plans for the proposed major A14 improvements arising from the Cambridge to Huntingdon multi-modal study, it is the Government's intention to utilise the resources, provided for implementing decisions arising from multi-modal studies in the Government's 10-year transport plan, to effect the A14 improvements. [27738]

  Mr. Spellar
  I can confirm that in the event of approval of the final plans for the proposed A 14 improvements, the scheme will be funded from the resources made available under the 10-Year Plan for Transport.

  Landscaping Industry
  Mr. Maples
  To ask the Secretary of State for Transport, Local Government and the Regions what recent research he has commissioned into the health and safety record of the landscaping industry; and if he will publish this research. [27884]

  Mr. Raynsford
  No recent research has been commissioned by the Health and Safety Executive into the health and safety record of the landscaping industry.

  Construction Industry
  Mr. Maples
  To ask the Secretary of State for Transport, Local Government and the Regions what new health and safety measures are planned for the construction industry, with particular regard to those businesses working within the land-based sector. [27883]

  Mr. Raynsford
  The Government have established the Strategic Forum for Construction to bring about industry consensus on future strategy and policy and has asked the chairman, Sir John Egan, to tackle the industry's health 494W
  and safety performance as a key priority for action. The Health and Safety Commission has also initiated a Construction Priority Programme to focus its resources on the industry and the Health and Safety Executive is planning to publish a discussion document in the spring to ask the industry's views on a wide range of issues that affect health and safety.

  The Constructors' Liaison Group, the umbrella body for the British Association of Landscape Industries, committed itself to adopting targets for certificated competence in health and safety of the work force, encouraging members to support the Construction Skills Certification Scheme and similar schemes.

  Genetically Modified Organisms
  Ms Coffey
  To ask the Secretary of State for Transport, Local Government and the Regions when the public register holding information on genetically modified organisms will be reopened. [29351]

  Dr. Whitehead
  The public register holding information on the contained use of genetically modified organisms will be reopened on or around 11 February and will contain all information except for that excluded in the interests of national security.

  Under the Genetically Modified Organisms (Contained Use) Regulations 2000 the Competent Authority—the Department for Environment, Food and Rural Affairs and the Health and Safety Executive (HSE) in England, the Scottish Ministers and HSE in Scotland—is required to maintain a public register, and is firmly committed to a policy of openness and transparency. The register contains information on all notified premises and activities.

  Following the activities of 11 September, HSE, on behalf of the Competent Authority, took the decision to temporarily withhold public access to the register because of the security risk.

  Yesterday I signed the Genetically Modified Organisms (Contained Use) (Amendment) Regulations 2002 which will allow the Secretary of State to exclude information from the register in the interests of national security.

  A meeting of the Technical Sub-Committee of the Advisory Committee on Genetic Modification and invited experts will consider the list of pathogens already compiled for schedule 5 of the Anti-terrorism, Crime and Security Act 2001 and whether any additional genetically modified pathogens should be excluded from the register.

  HSE acting on behalf of, and with the agreement of, the other members of the Competent Authority, will then review and sift the entries on the register and will reopen the register on or around 11 February. In the meantime HSE has arranged to make the information available to enquirers on a case-by-case basis.

  Following the reopening of the register a system of regular review will be put in place to consider those items excluded from the register, with the aim of keeping to a minimum information which has to be excluded in the interests of national security.

  Commuter Traffic
  Lembit Öpik
  To ask the Secretary of State for Transport, Local Government and the Regions what
  495W
  assessment his Department has made of the environmental benefits of using financial incentives to encourage commuter traffic to shift from using cars to motorcycles; and if he will make a statement. [26731]

  Mr. Boateng
  I have been asked to reply.

  The Government believe there are some environmental benefits associated with commuting by motorcycle rather than car. These are outlined in the interim report published by the Advisory Group on Motorcycling in April last year. A copy is available in the House Library.

  The Government are also currently undertaking a consultation exercise asking for views on how VED for motorcycles can better reflect environmental impacts. The closing date for responses is 8 February.

SOLICITOR-GENERAL

  Crown Prosecution Service
  Miss McIntosh
  To ask the Solicitor-General what assessment she has made of HM CPS inspectorate's report on inspection of the CPS in North Yorkshire; and if she will make a statement. [27682]

  The Solicitor-General
  The HMCPSI report on North Yorkshire was published on 4 December 2001. The Attorney-General and I have considered the report and are pleased to note the positive picture that it presents.

  The report identifies clear improvements since the last inspection of North Yorkshire in 1998. Inspectors found that the area had a very good sense of corporate identity supported by good communication, with an experienced, stable and committed staff and strong leadership. Good systems are in placed for monitoring and reporting on casework performance. The quality of the lawyers' decision-making is sound and cases are progressed well with on-going reviews. Some aspects of casework still require improvement but work is in hand to bring about the necessary improvements. The report commented positively on the quality of management of the area, standards of advocacy, relationships with other criminal justice agencies and the involvement of staff in community and specialist groups across the county.

  Plans have already been agreed to tackle those areas highlighted in the report where further improvements are necessary and action will be taken to ensure even better performance in the future.

  Bob Spink
  To ask the Solicitor-General what action she takes to prevent the use of inappropriate lesser charges by the Crown Prosecution Service. [28415]

  The Solicitor-General
  When considering any allegation, Crown Prosecutors are guided by statutory provisions and the Code for Crown Prosecutors. It is the duty of Crown Prosecutors to make sure that the right person is prosecuted for the right offence. In doing so, they must always act in the interests of justice and not solely for the purpose of obtaining a conviction.

  The code further advises that Crown Prosecutors should select charges which reflect the seriousness of the offending, give the court adequate sentencing powers and enable the case to be presented in a clear and simple way.
  496W
  This means that Crown Prosecutors may not always continue with the most serious charge where there is a choice.

  There are two stages in the decision to prosecute. The first stage is the evidential test. If the case does not pass the evidential test, it must not go ahead. If the case does meet the evidential test, Crown Prosecutors must decide if a prosecution is needed in the public interest.

  In addition to statutory provisions and the Code for Crown Prosecutors, the Crown Prosecution Service, Crown Prosecutors are guided by charging standards, nationally agreed with the police for a range of offences, including offences of violence. The charging standards for assaults were designed to ensure consistency in the charging and prosecuting of offences involving violence.

  CPS Essex has moved to a Criminal Justice Unit and Trial Unit structure. This move, together with the Narey reforms have meant that prosecutors are involved at a far earlier stage of the process and are able to provide advice.

  Bob Spink
  To ask the Solicitor-General how many cases, by category of offence, have been discontinued in the Essex Crown Prosecution Service in the last year for which records are available. [28420]

  The Solicitor-General
  The Crown Prosecution Service does not record offences discontinued or dropped by offence category. However, in the year October 2000 to September 2001, CPS Essex finalised 27,942 defendant cases, in the magistrates and Crown courts, out of which cases against 3,163 defendants were discontinued. This represents 11.3 per cent. of the total casework, against a national average for discontinue of 13.1 per cent.

  Bob Spink
  To ask the Solicitor-General what the target staffing level is of the Crown Prosecution Service in Essex; and what the actual level is. [28421]

  The Solicitor-General
  The staffing level for the Essex area of the Crown Prosecution Service on 1 April last year was 106.2 posts, comprising 37.6 prosecutor posts, and 68.6 administrative posts. The Government have made substantial extra resources available to the Crown Prosecution Service, a 23 per cent. increase in real terms, which has enabled it to recruit significant numbers of extra staff.

  Currently the Essex area has 115 staff in post, comprising 42 prosecutors and 73 administrative staff. This level of staffing meets the area's current needs.

DEFENCE

  Air-to-Air Missile
  Mr. Gareth R. Thomas
  To ask the Secretary of State for Defence when he expects the Advanced Short—Range Air-to-Air Missile to enter service; and if he will make a statement. [29350]

  Mr. Ingram
  The Advanced Short-Range Air-to-Air Missile (ASRAAM) will enter service with the Royal Air Force later this month. The delivery of the first batch of missiles marks the successful agreement between the Ministry of Defence and the missile manufacturer MBDA. By working constructively together, we have agreed a clear and robust route map to achieve the full operational
  497W
  capability required of the missile. Tornado F3 will be the first of our aircraft to be fitted with ASRAAM. The missile will also be one of Eurofighter' s principal weapons. ASRAAM will provide a major advance in our short-range air-to-air combat capability.

  Conflict Prevention Fund
  Angus Robertson
  To ask the Secretary of State for Defence what his policy is on disbursement of the UK Conflict Prevention Fund. [26669]

  Mr. Ingram
  [holding answer 11 January 2002]: Policy on the disbursement of the pooled budgets for conflict prevention is determined jointly by the Ministry of Defence, the Foreign and Commonwealth Office and the Department for International Development, working together with the Cabinet Office and the Treasury.

  The aim of the pooled budgets is to reduce the number of people whose lives are affected by violent conflict and the potential sources of future conflict. Strategies to achieve this are planned and reviewed through two sub-committees of the Cabinet Office Defence and Overseas Policy Committee, one for sub-Saharan Africa, the other for the rest of the world.

  The strategy for sub-Saharan Africa includes, for example, assisting with building indigenous peacekeeping capacity, as well as conflict resolution and security sector reform in Sierra Leone. Strategies for the rest of the world include regional strategies in the Balkans, central and eastern Europe, South Asia and the middle east, and functional strategies like assisting UN peacekeeping reform and controlling small arms and light weapons.

  The budgets also contribute to the additional costs of the UK's support to peacekeeping and peace-enforcement operations. In 2001–02 these have included commitments in Sierra Leone, Macedonia, Bosnia, Kosovo, and the Iraqi no-fly zones. Conflict prevention priorities and strategies are reviewed annually.

  RAF Bases
  Mr. Gray
  To ask the Secretary of State for Defence what percentage of flying hours were lost at(a) Lyneham and (b) Brize Norton in each of the last five years on account of (i) ice, (ii) fog and (iii) wind. [26625]

  Mr. Ingram
  Flying hours are not generally lost due to bad weather, as postponed flights will usually take place on a subsequent occasion. However weather conditions at RAF stations are assessed on an approximately hourly basis. Table 1 shows the percentage of occasions where weather conditions were assessed as 'red', ie the most severe conditions in terms of visibility and cloud cover. Table 2 shows the percentage of occasions when gusts of over 30 knots were registered. Not all flights are necessarily postponed in these conditions.

  Table 1

  RAF Brize Norton

  RAF Lyneham

  1997

  3.96

  4.71

  1998

  1.72

  2.52

  1999

  1.36

  2.29

  2000

  1.46

  2.32

  2001

  2.34

  3.01

  Average

  2.17

  2.97

  498W

  Table 2

  RAF Brize Norton

  RAF Lyneham

  1997

  3.05

  3.75

  1998

  2.07

  3.60

  1999

  2.22

  3.79

  2000

  2.27

  4.02

  2001

  0.84

  1.92

  Average

  2.09

  3.41

  Mr. Gray
  To ask the Secretary of State for Defence if he will estimate how many aircraft movements take place on an annual basis at(a) RAF Lyneham and (b) RAF Brize Norton; and how many of them were (i) in daylight and (ii) at night. [26626]

  Mr. Ingram
  The number of aircraft movements undertaken at RAF Lyneham was approximately 36,000 during 2001 and at RAF Brize Norton 33,000. About 9 per cent. of these movements were undertaken at night.

  Wind Turbines
  Jim Knight
  To ask the Secretary of State for Defence what his policy is on the support of wind turbine deployers seeking planning consent in consultative statements issued by Defence Estates of district councils as part of the planning consent issue process. [27274]

  Dr. Moonie
  The Ministry of Defence has a policy to assess each wind farm proposal on a case-by-case basis. We have an agreement with the wind energy industry that enables Defence Estates Safeguarding section to receive details of wind farms from individual companies some time prior to them applying for formal planning permission.

  If the developer subsequently proceeds to seek formal planning permission from the local planning authority (LPA) and the site lies outside a formally safeguarded area then there is no statutory obligation on the authority to consult Defence Estates although most do so. In cases where the MOD does object to a proposal and the developer continues with the project then Defence Estates would seek to be formally consulted by the local authority.

  As with all planning application consultations, Defence Estates Safeguarding strives to meet the response deadlines imposed by the planning process. Where we are unable to meet the deadline because the assessment is still being undertaken the LPA are advised to wait for our reply before consent is given. This action ensures that development does not occur that will either cause a safety hazard to military activity or interfere with the ability to train effectively.

  Antonov Aircraft
  Mr. Gray
  To ask the Secretary of State for Defence how many Antonov cargo planes are on charter to the RAF; how long those charters will last and what their total cost is; for what reason chartering Antonov is necessary; what assessment he has made of the possibility of using C-17s; and if he will make a statement about RAF transport requirements. [28182]
  499W
  Mr. Ingram
  [holding answer 17 January 2002]: Eleven Antonov aircraft sorties have been flown to date in support of UK force deployments to Afghanistan. Six further sorties have been contracted. £4 million has been spent to date.

  The nature of airfields available in Afghanistan, together with the threat presented by surface-to-air missiles (SAM) had limited the RAF to the use of Hercules transport aircraft, which are fitted with a defensive aids suite. While the Hercules is a versatile and capable aircraft, the Antonov has a far greater payload, and has enabled the more rapid deployment of equipment, since the company operating the Antonovs has not restricted their use, even with the SAM threat.

  A review of the threat to aircraft, and the re-opening of Kabul International airport, is likely to mean that use of the RAF's C-17 aircraft will soon be possible. However, the demanding timetable for the operation in Afghanistan is likely to mean that further Antonov charter will be required.

  Berthing Capacity
  Mr. Streeter
  To ask the Secretary of State for Defence what criteria he is using in the review of berthing capacity at Her Majesty's naval bases. [27897]

  Mr. Ingram
  The aim of the study into berthing capacity at Her Majesty's naval bases is to define the future policy for base porting and the required waterfront infrastructure to support maritime and joint operations. The criteria that will be used for the study include the following:

  (a) Any current base porting and waterfront infrastructure limitations that constrain the support of maritime and joint operations.

  (b) The waterfront infrastructure capacity required to support future maritime and joint operations. Taking into account that the next generation of warships including, the future aircraft carriers, Type 45 Destroyers, amphibious ships and ASTUTE class submarines are all significantly larger than their predecessors.

  (c) Apart from the larger dimensions of future vessels, a number of other considerations need to be taken into account, including increased use of naval harbours by commercial operators, the implications for personnel, the delivery of operational sea training, the need to accommodate visiting vessels from NATO and other nations, conventional weapons handling safety regulations, environmental impact and future berthing policy for Royal Fleet Auxiliary vessels. A large number of longer-term factors, including the consequences of various initiatives such as the Navy's TOPMAST project (Tomorrow's Personnel Management System), warship support Modernisation, contractor logistic support and reliability centred maintenance will require further detailed consideration during the course of the work.

  Mr. Streeter
  To ask the Secretary of State for Defence when he will decide the outcome of his Department's review of berthing capacities at Her Majesty's naval bases. [27896]

  Mr. Ingram
  The study into berthing capacity at Her Majesty's naval bases is due in the summer of 2002. Decisions on base porting will be informed by this study.

  Pensions
  Mr. Swayne
  To ask the Secretary of State for Defence if he will estimate the cost to the armed forces pension 500W
  scheme of providing pensions, at a rate of one half the serving members' pension, to widows and widowers of personnel who retired before 1 April 1973. [27193]

  Mr. Ingram
  The Armed Forces Pension Scheme (AFPS) increased the rate of widows' and widowers' pension from one third of the members pension to one half, from 31 March 1973. Individuals serving on or after this date were provided with the opportunity to make additional contributions so as to qualify former service for the half rate of widows' pension. On this basis, it would be difficult, in equity, to extend the half rate pension to widows whose husbands had left the service before that date and who had not, as a result, contributed financially towards the improvement. It has also been the long-standing policy of successive Governments that discretionary changes to improve the benefits offered by public service pension schemes should be implemented for future service only.

  We do not know exactly how many people would be affected by such a change, but we estimate the cost for the Armed Forces Pension Scheme to be £25–30 million per year. The cost would be substantially higher if the improvement were extended to other public service pension schemes.

  Mr. Swayne
  To ask the Secretary of State for Defence if he will estimate the cost to the Armed Forces Pension Scheme of entitling servicemen and women who retired before 31 March 1973 to buy-in to the scheme's improved benefits in respect of providing widows and widowers a full half pension. [27194]

  Mr. Ingram
  As such a change would be on a "buy-in" basis, we would expect the cost of extending the half rate pensions to pre-1973 widows and widowers to be covered by contributions. The Ministry of Defence would incur administration costs but these would be relatively small. However, such changes have been ruled out by the long-standing policy of successive Governments that scheme improvements should not be retrospective.

  UN Military Staff College
  Angus Robertson
  To ask the Secretary of State for Defence what the status is of the proposed UN military staff college for the training of peace keepers; and if he will propose using the Scottish Centre for Nonviolence as its location. [26683]

  Mr. Ingram
  [holding answer 11 January 2002]: The UK's approach to providing support to UN training is through a flexible programme of training aimed at enhancing multinational co-operation and interoperability, and strengthening the integrated civil-military approach to peace support operations. This is achieved through conferences, seminars and workshops, expanding places on, or reorientating, existing courses and the development of bespoke UN courses. This is being carried out very successfully throughout locations within the UK and abroad. While a dedicated UN military staff college remains a possibility, we are not currently pursuing the establishment of one.

  Eagle-Picher
  Mr. Paul Marsden
  To ask the Secretary of State for Defence what assessment he has made of the accuracy of bombs dropped on Afghanistan with batteries produced by Eagle-Picher; and if he will make a statement. [27258]

  Mr. Ingram
  Eagle-Picher batteries are used in US munitions, and this is therefore a matter for them.

  Search and Rescue Squadron
  Bob Russell
  To ask the Secretary of State for Defence if he will ensure that waterproof helmet-fitted radios are made available for Royal Air Force Search and Rescue Squadron winchmen. [28096]

  Mr. Ingram
  Subject to a satisfactory outcome of current trials, a helmet-radio assembly for RAF Search and Rescue winchmen will come into service this summer. A fully integrated and waterproof helmet-radio is scheduled to be introduced next year. This will permit full radio and intercom voice communications between the helicopter crew and the winchman.

  Bob Russell
  To ask the Secretary of State for Defence how many winchmen serve with the Royal Air Force Search and Rescue Squadron. [28095]

  Mr. Ingram
  There are currently 49 Search and Rescue winchmen within the Royal Air Force.

  US Trident Submarines
  Mr. Alan Simpson
  To ask the Secretary of State for Defence what discussions his Department has had with its counterparts in Washington concerning US plans to convert two of its fleet of Trident submarines to conventional use. [28259]

  Mr. Ingram
  We have not taken part in any discussions.

CULTURE, MEDIA AND SPORT

  Fraud
  Mr. Menzies Campbell
  To ask the Secretary of State for Culture, Media and Sport what estimate her Department has made of the cost to its budget since 1 May 1997 of fraud; and if she will make a statement. [27288]

  Dr. Howells
  The available information is given in the table:

  £

  1997–98

  1998–99

  1999–2000

  2000–01

  DCMS1

  1,909

  0

  0

  0

  Royal Parks Agency

  0

  0

  0

  0

  Historic Royal Palaces Agency2

  13,600

  —

  —

  —

  Non-departmental Public Bodies

  152,183

  178,894

  1,978

  23,272

  1 Net of amounts recovered

  2 Historic Royal Palaces Agency became an non-departmental public body on 1 April 1998

  Film Council
  Nick Harvey
  To ask the Secretary of State for Culture, Media and Sport how many full-length feature 502W
  films the Film Council has financially supported in each year since its creation; what the total income for each of those films is; what estimate the Film Council has made of each film's total audience; and if she will make a statement. [27754]

  Dr. Howells
  The Film Council has directly or indirectly financially supported a total of 58 feature length films to date since its creation. Of these, 15 were directly funded from the Film Council Lottery funds which became operational in October 2000. The remainder were funded through the pre-existing Lottery film franchises or through the interim arrangements with the film production activities of its predecessor bodies—the Arts Council of England (through Lottery funding) and British Screen Ltd. (through grant in aid funding).

  The total cash received by the Film Council to 31 December 2001 against the 58 titles is £2,091,739. A film is normally expected to generate income over several years and the income received to date against these titles is therefore only a small part of the expected return on investment.

  The Film Council does not produce estimates of total audience for individual films. A film's earning potential spans a number of international markets or countries and a range of media platforms (including cinema, video, DVD, and television) and it is therefore unrealistic to attempt to estimate total audience.

  Nick Harvey
  To ask the Secretary of State for Culture, Media and Sport how much money the Film Council received from lottery funds in the last financial year; what amount the Film Council allocated in the last financial year; what amount the Film Council allocated and paid out in the last financial year; and if she will make a statement. [27753]

  Dr. Howells
  The Film Council was allocated £31.474 million in income from the National Lottery Distribution Fund during the 2000–01 financial year. The Film Council allocated £33.82 million of lottery funding to projects and paid out £20.003 million in the same year.

  Lost/Stolen Property
  Mr. Bercow
  To ask the Secretary of State for Culture, Media and Sport if she will list those items valued at more than £50 which have been stolen or lost from her Department in each of the last four years. [27993]

  Dr. Howells
  Items stolen from the Department over the last four years are as follows: a laptop computer (1998), three personal computer base units and one personal computer monitor (2001). As required each incident was reported immediately on discovery as a security breach.

  Refurbishment
  Mr. Bercow
  To ask the Secretary of State for Culture, Media and Sport what her estimate is of the cost of buildings refurbishment carried out by her Department in each of the last four years. [27970]

  Dr. Howells
  The Department has needed to relocate some divisions during the last four years and refurbishment has been necessary in those cases in preference to higher rental costs for property offered by developers. In 1999 the Government Art Collection was
  503W
  rehoused at a cost of £144,000. In 2000 the cost of moving towards a single roof solution for the Department was £615,000 and improving facilities in 2000 and 2001 was at a cost of £375,000 and £648,000 respectively.

WORK AND PENSIONS

  Benefit Costs
  Mr. Bercow
  To ask the Secretary of State for Work and Pensions if he will make a statement on the cost in(a) 2000–01 and (b) 2001–02 of the (i) Integrated Enquiry Service, (ii) Shared Fraud Hotline, (iii) local authority departmental information teams and (iv) overpayment recoveries in respect of housing benefit. [19009]

  Malcolm Wicks
  These initiatives made up the housing benefit improvement programme, the purpose of which was to contribute to improving housing benefit and council tax benefit administration. During the life of the programme, strong links were established with local authority managers and staff that will continue to develop as the recommendations from the programme are taken forward. These relationships have contributed to a greater understanding of the local authority information requirements, and the introduction of a standard set of procedures that will help deliver improvements to the recovery of housing benefit and council tax benefit overpayments.

  The information on costs is in the table:

  Housing benefit improvement programme expenditure

  £

  2000–011

  2001–02

  Integrated Enquiry Service

  557,000

  2309,000

  Shared Fraud Hotline

  78,000

  257,000

  Local Authority/Benefits Agency Information Flow Project

  24,000

  0

  Housing Benefit Overpayment Recovery Project

  64,000

  2819,000

  1 Outturn

  2 Forecast

  Note

  Figures are rounded to nearest £1,000

  Source:

  Housing Benefit Improvement Programme budget

  Mental Health
  Lynne Jones
  To ask the Secretary of State for Work and Pensions what research the Government have conducted on the health impact on mental health service users of the implementation of his Department's benefits policies. [20231]

  Mr. Nicholas Brown
  A major goal of the Government are to help those people who are sick or disabled who can work to do so, while providing security for those who cannot work. This group includes people with mental health problems, whether they use mental health services or not. The Department for Work and Pensions consults with service users to ensure that relevant research informs new ideas and policy implementation.

  The Office for National Statistics published a report on the Psychiatric Morbidity of Adults carried out on behalf of the Department of Health on 18 December. The main aim of the survey was to estimate the prevalence of psychiatric morbidity among adults aged 16 to 74 living
  504W
  in private households in Great Britain. The survey report also examines the use of services associated with mental disorder and considers the characteristics—including economic activity—of people with mental disorder.

  A longitudinal follow up to that survey is planned for 2002 and aims to estimate the duration of mental health problems. The study will also involve some follow-up work on use of services.

  Departmental Sickness Absence
  Mr. Bercow
  To ask the Secretary of State for Work and Pensions if he will commission and publish an independent report on the reasons for the level of sickness absence in his Department. [26999]

  Mr. McCartney
  We have no plans to publish an independent report on the reasons for absence in the Department.

  The Cabinet Office already commissions and publishes an independent annual report covering all Government Departments; "Analysis of Sickness Absence in the Civil Service". This report includes details of the causes of absenteeism in my Department.

  The report for the year 2000, will be published shortly.

TRADE AND INDUSTRY

  Electricity
  Fiona Mactaggart
  To ask the Secretary of State for Trade and Industry when she expects to respond to the consultation on the impact of NETA on small generators. [26601]

  Mr. Wilson
  The Government are analysing and considering responses to their consultation carefully. The Department of Trade and Industry will be issuing a response shortly.

  Departmental Expenditure
  Matthew Taylor
  To ask the Secretary of State for Trade and Industry, pursuant to her answer of 17 December 2001,Official Report, column 473W, on departmental expenditure, what estimate she has made of the savings produced by refinancing; over what period of time she expects these to be realised and under which vote; and if she will make a statement. [26080]

  Ms Hewitt
  The refinancing programme to date is estimated to generate £75 million of savings. The majority of the savings will be realised over the next five years, but will continue until 2018.

  The relevant vote is the Export Credits Guarantee Department Request for Resources 1.

  Former Miners
  Ms Walley
  To ask the Secretary of State for Trade and Industry what representations(a) she and (b) her Department has received on allowing former miners, who were sacked in the 1980s, access to their pension funds. [27606]
  505W
  Mr. Wilson
  None. All former British Coal miners when reaching pensionable age, whether dismissed or not, have access to the pension benefits they have accrued while in employment.

  I announced on 11 December 2001, Official Report, columns 759–60W, that certain miners dismissed during the 1984–85 strike would receive an enhancement to their pension in recognition of the years of further service they lost as a result of British Coal's decision not to re-employ them.

  Environmental Reports
  Mr. Weir
  To ask the Secretary of State for Trade and Industry how many(a) multinational companies with bases in Scotland and (b) Scottish companies had published environmental reports by 31 December 2001. [27272]

  Mr. Wilson
  While the Government are keen to encourage companies to report, it is not mandatory to do so. There is, therefore, no central register of which companies report.

  Renewable Energy
  Mr. Stunell
  To ask the Secretary of State for Trade and Industry what the total level was of Government financial support to the renewable energy sector in each year between 1980 and 1990 broken down by(a) research grants, (b) non-fossil fuel levy and (c) other sources. [27456]

  Mr. Wilson
  Main Government financial support for the renewable energy sector between 1980 and 1990 was in the form of research grants from the then Department of Energy's New and Renewable Energy Research and Development Programme. Programme spend was as follows:

  £ million

  1980–81

  11.1

  1981–82

  17.3

  1982–83

  14.1

  1983–84

  11.3

  1984–85

  14.1

  1985–86

  12.7

  1986–87

  11.6

  1987–88

  14.3

  1988–89

  15.3

  1989–90

  17.2

  1990–91

  20.4

  During these years, the Government may also have funded some other relevant research projects managed by the research councils, but to identify these projects now would be difficult and would involve disproportionate cost.

  The Non Fossil Fuel Obligation and the Fossil Fuel Levy supporting it were introduced in financial year 1990–91. In 1990–91, levy support for renewable energy was £6.1 million. I am not aware of funding for renewable energy from other Government sources from 1980 to 1990.
  506W
  Mr. Carmichael
  To ask the Secretary of State for Trade and Industry if she will list the projects and institutions benefiting from the Lottery money announced by the Government in March 2001 for research into renewable energy projects. [25888]

  Mr. Wilson
  [holding answer 15 January 2002]: Funding from the Lottery is being directed especially towards the development of the offshore wind energy and energy crops industries. The offshore wind energy scheme is now open for applications and we are presently working up the details of the energy crops scheme. No funds have yet been awarded under either scheme.

  Wind Turbines
  Jim Knight
  To ask the Secretary of State for Trade and Industry (1) how much she has allocated for grant aid to farmers in siting small scale wind power generators on their land; and how much has been issued under this grant scheme to date; [27277]

  (2) what steps are being taken in support of farmers in the siting of wind turbines as a vehicle for agricultural diversification. [27276]

  Mr. Wilson
  The Government believe that the financial incentive provided by the Renewables Obligation and exemption from the climate change levy will be sufficient to bring forward new onshore wind projects without the requirement for further financial support from Government.

  The Renewables Obligation will succeed the Non-Fossil Fuel Obligation (NFFO). Between 1990 and 1998 302 wind projects were awarded NFFO contracts, of which 74 had commissioned by 30 September 2001. The Electricity from Non-Fossil Fuel Sources (Locational Flexibility) Order 2001 which was made in December will enable a number of those projects which have yet to commission to come forward and a number of these are likely to be on agricultural land.

  I was pleased to launch on 28 August 2001 an innovative new service, operated by National Wind Power Ltd., to help farmers and landowners to develop small wind energy projects typically comprising one, two or three turbines. The WindWorks package has been developed to provide farmers with the financial rewards associated with ownership of a wind energy project while avoiding exposure of farmers and landowners to new financial risks at a time when great uncertainty exists in the farming industry and rural economy. More detail on WindWorks can be found at: http://www.natwindpower.co.uk/windworks/index.htm.

  NETA
  Mr. Carmichael
  To ask the Secretary of State for Trade and Industry what measures she has taken to help intermittent suppliers adversely affected by NETA. [25894]

  Mr. Wilson
  [holding answer 15 January 2002]: On 1 November 2001 I published a consultation document in response to Ofgem's reports on NETA and its impact on smaller generators, including intermittent generators. Consultation closed on 1 December and follow-up work to analyse responses and take appropriate action is now under way. On 20 December I announced the formation of a working group to look at obstacles to consolidation

  507W
  under NETA, and to report to DTI by 31 January 2002. Many of the issues raised and considered in the consultation document, and by the working group, apply to the demand side, including intermittent suppliers. The Government will be publishing a response to their consultation shortly.

  Nuclear Waste Storage
  Mr. Carmichael
  To ask the Secretary of State for Trade and Industry what assessment has been made of the ability of the UK's intermediate and high level nuclear waste storage facilities to withstand terrorist attack. [25891]

  Mr. Wilson
  [holding answer 15 January 2002]: The UK's civil nuclear sites apply stringent security measures regulated by the Office for Civil Nuclear Security (OCNS), the security regulator. The security regulator works closely with the Health and Safety Executive, the safety regulator, which provides advice on the safety implications of events, including external hazards such as plane crashes, at nuclear installations. Security and safety precautions at nuclear sites are kept under regular review. Both regulators are reviewing all relevant precautions in the light of the terrorist attacks in the USA on 11 September 2001. It is not Government policy to disclose details of security measures taken at civil nuclear sites.

  Mr. Carmichael
  To ask the Secretary of State for Trade and Industry if she will list the(a) annual cost of maintaining the nuclear waste storage facilities at Sellafield and Dounreay and (b) the forecast for the annual running and maintenance costs over the next 50 years.

  Mr. Wilson
  [holding answer 15 January 2002]: I am advised by UKAEA and BNFL that the current total annual cost of maintaining radioactive waste storage facilities at Dounreay is £12 million, and at Sellafield is £50 million, while the forecast total running and maintenance cost of radioactive waste storage facilities over the next 50 years at Dounreay is £450 million and at Sellafield is £1,100 million.

  All figures are at 2001–02 money values and include overheads.

  Energy Charter Conference
  Mr. Key
  To ask the Secretary of State for Trade and Industry who represented her Department at the Energy Charter Conference session on 17 December 2001. [27889]

  Mr. Wilson
  Officials of the Department of Trade and Industry represented the United Kingdom at this meeting.

  BAE
  Mr. Evans
  To ask the Secretary of State for Trade and Industry what discussions she has had with BAE concerning the future of the plant at Broughton. [28658]

  Mr. Wilson
  Airbus UK owns the plant at Broughton and another site at Filton, where all the wings for Airbus aircraft are developed and manufactured. The Department remains in close touch with the company and with BAE Systems, which is a 20 per cent. shareholder in the Airbus company. UK work on Airbus programmes, including at Broughton, was covered in recent discussions between 508W
  BAE Systems and my right hon. Friend the Secretary of State for Trade and Industry and also in discussions which I had recently with Airbus UK and Airbus in Toulouse.

TREASURY

  Public Expenditure
  Mr. Bercow
  To ask the Chancellor of the Exchequer what percentage of each public expenditure programme was cash-limited in each of the years from 1992–93 to 2001–02. [26273]

  Mr. Andrew Smith
  Information on the cash limits and total spending for each Department is available in the following documents.

  Year

  Spending plans

  Final cash limits and DELs

  1992–93

  Cm 1920

  Tables 3.3 and B1

  Cm 2273

  Tables 1 and 2

  1993–94

  Cm 2219

  Tables 3.3 and B1

  Cm 2617

  Tables 1 and 2

  1994–95

  Cm 2519

  Tables 2.1 and 2.2

  Cm 2903

  Tables 2 and 3

  1995–96

  Cm 2821

  Tables 2.1 and 2.2

  Cm 3318

  Tables 2 and 3

  1996–97

  Cm 3201

  Tables 2.1 and 2.2

  Cm 3696

  Tables 2 and 3

  1997–98

  Cm 3601

  Tables 1.1 and 1.2

  Cm 3988

  Tables 2 and 3

  1998–99

  Cm 3901

  Tables 1.1 and 1.2

  Cm 4416

  Tables 2 and 3

  1999–2000

  Cm 4201

  Tables 1.2 and 1.3

  Cm 4812

  Table 1

  2000–01

  Cm 4601

  Tables 1.2 and 1.3

  Cm 5243

  Table 1

  2001–02

  Cm 5101

  Tables 1.1 and 1.2

  HC 391

  Table 1.41

  1 Latest position

  Mr. Bercow
  To ask the Chancellor of the Exchequer what percentage of the gross domestic product he expects public expenditure to constitute in 2006–07.

  Mr. Andrew Smith
  Firm spending plans for 2006–07 will be set out in a future Spending Review. Paragraph B20 of the pre-Budget report (Cm 5318) explains the assumptions made in the Government's current fiscal projections.

  Direct and Indirect Taxation
  Mr. Bercow
  To ask the Chancellor of the Exchequer if he will estimate the percentage change in upper tax income per income decile as a consequence of announced changes to direct and indirect taxation over the period 2002–03 to 2004–05. [26330]

  Mr. Andrew Smith
  There will be a reduction in income tax for a relatively small number of higher rate taxpayers with the increase in the children's tax credit to up to £20 a week for families in the year of a child's birth from April 2002. Apart from this, announced tax changes over the period 2002–02 to 2001–05 will have no impact on higher rate taxpayers.

  Single Person's Allowance
  Mr. Bercow
  To ask the Chancellor of the Exchequer by how much in real terms the average annual tax payments of a person with no allowance and reliefs other than the single person's allowance earning(a) £10,000, (b) £20,000, (c) £30,000, (d) £50,000 and (e) £100,000 has changed since 1997–98. [26214]

  Dawn Primarolo
  The reduction in tax at 1997–98 prices for a taxpayer claiming only the personal allowance and earning the specified levels in 1997–98 and 2000–01 are shown in the table.
  509W

  £

  Earnings

  Tax reduction at 1997–98 prices1

  £

  Earnings

  Tax reduction at 1997–98 prices1

  £10,000

  271

  £20,000

  531

  £30,000

  792

  £50,000

  1,816

  £100,000

  3,276

  1 Deflated using RPI

  Customs and Excise Forecasts
  Mr. Lidington
  To ask the Chancellor of the Exchequer if he will make it his policy(a) to record the reasons for manual adjustments made by HM Customs and Excise to their modelled forecasts for alcohol receipts and (b) to make public those reasons. [26411]

  Mr. Boateng
  Under Exemption 2 of the Code of Practice on Access to Government Information, it would be inappropriate to publish internal discussion and advice leading to the published alcohol revenue forecasts.

  Pre-Budget Report
  Mr. Bercow
  To ask the Chancellor of the Exchequer what the cost was of the publication and distribution of the 2001 pre-Budget report. [27438]

  Mr. Andrew Smith
  The net cost of printing and distributing the 2001 PBR was £56,000.

  Aggregates Levy
  Mr. Weir
  To ask the Chancellor of the Exchequer which other countries in the European Union have introduced an aggregates levy; what discussions he has had with the finance Ministers of the European Union regarding a common aggregate levy; what the level of aggregates levy proposed in each of the countries of the European Union is; whether aggregates imported into the UK from other countries(a) in and (b) outside the European Union will be subject to the aggregate levy; what tonnage of aggregates has been imported into the United Kingdom from (i) the European Union and (ii) countries outside the European Union in each of the last five years; and whether added value aggregates products from outside the United Kingdom will be subject to the aggregate levy. [26775]

  Mr. Boateng
  [holding answer 14 January 2002]: The aggregates levy is designed to address the environmental effects of aggregate extraction in the UK and the rate was set to reflect these costs following independent research. Aggregate taxes in other EU member states are a matter for the individual states themselves. The known current position in the member states can be summarised as follows:

  Denmark—0,67 euro/m3

  France—0.1 euro/tonne

  Spain—no national tax hut potential for regional taxation

  Italy—regional taxation, typically 2 to 5 per cent. of value

  Sweden—0.6 euro/tonne on sand and gravel only

  Austria—regional tax of approximately 0.15 euro/tonne

  Greece—2 per cent. of value

  Netherlands—in the process of introducing a tax.

  510W
  Aggregates imported from other countries, whether in the EU or not, will be liable to the levy. The total tonnage of imported aggregate for each of the last five years for which data are available is as follows.

  Imports

  Tonnes

  1994

  2,166,211

  1995

  1,942,602

  1996

  642,581

  1997

  502,381

  1998

  822,087

  Imported products made from aggregates are not themselves aggregates and so will not be subject to the levy.

  Business Taxation
  Mr. Bercow
  To ask the Chancellor of the Exchequer what plans he has to simplify business taxation. [27465]

  Dawn Primarolo
  A number of measures to simplify business taxation were contained in the Budget and pre-Budget reports, published in March 2001 and November respectively. Both these documents are available in the Library of the House.

  Departmental PFI Contracts
  Matthew Taylor
  To ask the Chancellor of the Exchequer what estimate he has made of the proportion of PFI contracts made by his Department where an amount in excess of 90 per cent. of the capital value of the asset is recouped by the lessor out of the capital element of lease payments over the lifetime of the contract concerned; and if he will make a statement. [27697]

  Mr. Andrew Smith
  No such estimate has been made. The existing PFI contracts in the Departments are for the provision of a service in return for a unitary payment, the payment of which is dependent on satisfactory performance. The unitary payment is not broken down into constituent parts.

  Public Sector Pay
  Mr. Bercow
  To ask the Chancellor of the Exchequer what the impact of the public pay review bodies' recommendations will be on the public spending limits of 2001–07. [27921]

  Mr. Andrew Smith
  Public spending plans are settled in the spending reviews, and are not amended by reference to the recommendations of the pay review bodies. It is normal practice for Departments to accommodate pay awards within public spending limits.

  VAT
  Mr. Lidington
  To ask the Chancellor of the Exchequer what his policy is towards introducing reduced rates of VAT on organisations covered by category 14 of annexe H to the Sixth Directive.

  Mr. Boateng
  [holding answer 17 January 2002]: Not-for-profit welfare services provided by charities are already VAT exempt.

  Drug Misuse
  Mr. Bercow
  To ask the Chancellor of the Exchequer if he will list by Department the total amount allocated to tackling problems relating to drugs in each of the last 10 years. [27452]

  Mr. Bob Ainsworth
  I have been asked to reply.

  Information on resources is not available in the form requested.

  The Government have made available substantial resources for directly tackling the problem of drug misuse. A breakdown of funding allocated for the years 1995 to 2004 is as follows.

  The first United Kingdom drugs strategy, "Tackling Drugs Together", was launched in May 1995 and allocated £8.8 million over three years to Drug Action Teams, £5.9 million on schools drug education for 1995–96, and £1 million in the same year for services to young people at an early stage of drug misuse.

  For the present strategy "Tackling Drugs to Build a Better Britain", the 1998 Comprehensive Spending Review settlement provided an additional £217 million of resources for three years. The Spending Review 2000 (SR 2000) and the Budget 2001 provided further resources bringing total expenditure under the drugs strategy to nearly £1 billion by 2003–04—see Table A.

  Furthermore, SR 2000 also supported a range of related programmes—see Table B—and following the Budget 2001, some additional investment was made, particularly to help Communities tackle drug misuse—see Table C.

  Table A: 2000 Spending Review—resources directly allocated for tackling drug abuses (by main aim of the national anti-drugs strategy)1

  2000–012

  2001–02

  2002–03

  2003–04

  Drug treatment3

  234

  328

  377

  401

  Protecting young people

  63

  90

  97

  120

  Safeguarding communities

  45

  79

  81

  95

  Reducing availability4

  353

  373

  376

  380

  Total

  695

  870

  931

  996

  1 Excludes devolved spending

  2 Estimates of baseline spend in Departmental Expenditure Limits

  3 Comprises mainstream spending by the Department of Health, local authorities and the pooled National Treatment Agency (NTA) budget. Excludes additional Prison Service treatment spend, brigaded under Communities

  4 UK spend for 2001–02 to 2003–04 includes the anti-drugs share of the £90 million approved for combating organised crime

  Table B: 2000 Spending Review—new resources provided for related programmes1

  2001–02

  2002–03

  2003–04

  Criminal Justice System

  1,420

  2,290

  2,720

  Neighbourhood Renewal Fund

  200

  300

  400

  Children's Fund

  100

  150

  200

  Connexions2

  77

  177

  3—

  1 Excludes devolved spending

  2 This was added to existing provision for the careers service. Funding will continue to go to the careers service in areas where Connexions is not yet running

  3 Provision for 2003–04 will be announced in due course

  512W

  Table C: Budget 2001—new resources for anti-drugs measures1

  2001–02

  2002–03

  2003–04

  Strengthening communities

  50

  70

  100

  Extending drug testing in the CJS

  0

  20

  30

  Providing more help to find jobs

  5

  15

  20

  Strengthening DATs

  5

  5

  5

  Expanding Positive Futures

  2

  3

  2—

  1 Excludes devolved spending

  2 Provision to be decided in the light of other sources of funding

ENVIRONMENT, FOOD AND RURAL AFFAIRS

  Home Energy Efficiency
  Mr. Llwyd
  To ask the Secretary of State for Environment, Food and Rural Affairs what assessment she has made of(a) how much is invested annually into household energy efficiency and (b) how this money is spent. [25625]

  Mr. Meacher
  The Government estimate that during 2000 (the most recent year for which figures are available) the total investment in household energy efficiency measures was approximately £250 million (excluding double glazing). The breakdown for the major items of this expenditure is:

  £million

  Loft insulation

  90

  Cavity wall insulation

  70

  Lighting

  50

  Draught proofing

  20

  Condensing boilers1

  10

  Tank insulation

  5

  1 This figure includes only the fraction of the total cost of the boiler assumed to represent the additional cost of the increased energy efficiency.

  Although installing double glazing in homes does increase the energy efficiency of the building it is rare that double glazing is installed for energy efficiency reasons alone. Hence, expenditure on double glazing is excluded from the figures. However, the Government estimate that the energy efficiency component of double glazing installations totals some £500 million p.a.

  Home Heating
  Mr. Steen
  To ask the Secretary of State for Environment, Food and Rural Affairs when she will install heating equipment at the house of Mrs. Anita Farrow of Ashburton, a constituent; and if she will make a statement on the reason for the delay. [24955]

  Mr. Meacher
  [holding answer 9 January 2002]: The Home Energy Efficiency Scheme (HEES), now marketed as The Warm Front Team, is administered in south-west England by the Eaga Partnership Ltd. Eaga advise that contractors are due to complete the work on Mrs. Farrow's property by the end of this month.

  The delay was mainly due to the original heating contractor declining to carry out the work after having agreed to do so. It took some time to locate an alternative contractor and resolve a shortage of suitable heating equipment.

  Rural Regeneration
  Charlotte Atkins
  To ask the Secretary of State for Environment, Food and Rural Affairs what sources of(a) Government and (b) EU funding are available to (i) farmers, (ii) rural villages, (iii) rural businesses, (iv) local authorities, (v) parish councils and (vi) rural voluntary organisations to help regenerate rural economies. [27257]

  Alun Michael
  Many Government and European Union programmes contribute to the rural agenda.

  Through the Regional Development Agencies (RDAs) and the Countryside Agency we support the market towns programme which is intended to regenerate some 120 small rural towns as well as a range of support measures to rural businesses via the rural development programme and redundant building grant scheme.

  Through the Countryside Agency we support the Vital Villages programme which includes community service grants to support projects to maintain or introduce services which are local priorities; parish transport grants for small scale projects to meet local needs; parish plans grants to help 1,000 parishes draw up their own town or village plans to set out local needs and aspirations.

  The Department for Environment, Food and Rural Affairs is responsible for the following programmes which involve funding from the Government and from the European Community:
  The England Rural Development Programme (ERDP) under which the two main priority areas for funding are schemes to conserve and enhance the rural environment and schemes to enable farming, forestry and other rural businesses and communities to adapt to changing circumstances and to create a productive and sustainable rural economy.
  Objective 1 funding in certain areas (Cornwall and the Isles of Scilly, Merseyside and South Yorkshire) to promote similar measures to the ERDP. Because these areas are defined by the Commission as being of greater need, the rates of grant are slightly higher.
  Leader+ Local Action Groups (which include farmers, rural villages, rural businesses, local authorities, parish councils and voluntary organisations) are helping to improve the quality of life and economic prosperity in their area through innovative approaches to sustainable rural development.

  A more extensive list of potential sources of funding and advice for rural businesses can be found in Annex 1 of the Rural White Paper, "Our Countryside: the future, a fair deal for rural England" published in November 2000. A report on our progress on implementation of the Rural White Paper was included in "England's Rural Future", published on 12 December 2001, Official Report, column 920W.

  Kyoto Protocol
  Malcolm Bruce
  To ask the Secretary of State for Environment, Food and Rural Affairs whether she proposes an early ratification of the Kyoto protocol by the United Kingdom; and if she will make a statement. [27837]
  514W
  Mr. Meacher
  [holding answer 16 January 2002]: For legal and presentational reasons, the UK will ratify the Kyoto protocol at the same time as the European Community and other member states. At the European Council on 31 October 2001, the EU stressed
  "the Community's and its member states' resolve to complete their ratification procedures in time for timely ratification with a view to entry into force of the Kyoto protocol by the World Summit on Sustainable Development"
  in 2002.

  The first step in the process is for the EC to ratify the protocol through the adoption of a Council Decision that will include further clarification on the arrangements for implementing the agreement between the EC and its member states in 1998 on sharing out the EC's-8 percent. target. A Council Decision dealing with these issues is currently under discussion and is expected to be adopted at the next Environment Council on 4 March 2002.

EDUCATION AND SKILLS

  Student Loans Company
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what the administration costs of the Student Loans Company were in 2000–01; and what she expects them to be in 2001–02. [21299]

  Margaret Hodge
  The Student Loans Company's provisional outturn of administration costs in 2000–01 was £47.5 million (cash). The final figure will be included in the company's 2000–01 annual report which is expected to be published in mid-December 2002. Copies of this document will be placed in the Libraries of both of the Houses of Parliament.

  The planned administration expenditure for 2001–02 is £55 million.

  Both of these figures are provided on a UK basis, and include funding from the private sector to cover the administration of the two sold loan portfolios.

  Higher Education Funding Council
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what the administration costs of the Higher Education Funding Council for England were in 2000–01; and what she expects them to be in 2001–02. [21291]

  Margaret Hodge
  Provision for the administrative costs of the Higher Education Funding Council for England is £14.6 million in 2001–02 and £14.9 million in 2002–03.

  Further Education Funding Council
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what the administration costs of the Further Education Funding Council were in 2000–01; and what she expects them to be in 2001–01. [21292]

  John Healey
  We do not yet have final expenditure details for the Further Education Funding Council (FEFC) in 2000–01. Latest planned funding for the FEFC for administration was £27.4 million.
  515W
  The FEFC will not incur any administrative costs in 2001–02. From April 2001 the Learning and Skills Council (LSC) has taken over the majority of the functions previously carried out by the FEFC, as well as those of TECs.

  Teacher Training Agency
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what the administration costs of the Teacher Training Agency were in 2000–01; and what she expects them to be in 2001–02. [21297]

  Mr. Timms
  The administration costs of the Teacher Training Agency (TTA) in 2000–01, as published in the agency's annual financial statements, were £7.392 million. The TTA's current forecast administration costs for 2001–02 are around £7.85 million.

  Qualifications and Curriculum Authority
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what the administration costs of the Qualifications and Curriculum Authority were in 2000–01; and what she expects them to be in 2001–02. [21300]

  Mr. Ivan Lewis
  The Qualifications and Curriculum Authority incurred administration costs in 2000–01 of £25,600,000, and expects to spend £28 million in 2001–02.

  Investors in People
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what the administration costs of Investors in People were in 2000–01; and what she expects them to be in 2001–02. [21301]

  John Healey
  In this financial year, Investors in People UK will receive grant in aid of £1.617 million. Up to 75 per cent. of this is used for running costs—e.g. staff/premises costs; the remainder is used to fund the development of the standard. In addition to this, the company has also received additional funding of £1.6 million from the Department for marketing purposes. Last year, IiP UK generated additional income of £3.7 million from their own operations, which was used to carry out development, quality assurance, and advice and guidance.

  Exam Standards
  Mr. Damian Green
  To ask the Secretary of State for Education and Skills if she will publish the full report of the Qualifications and Curriculum Authority into the claims of Mr. Jeffrey Robinson about exam standards. [24887]

  Mr. Ivan Lewis
  QCA commissioned a full report from the awarding body OCR on Mr. Robinson's allegations. Although the OCR report is a confidential technical document and it is not QCA's practice to publish documents of this type, QCA's assessment of it has been published in the QCA website.

  Civil Service Code
  Mr. Fallon
  To ask the Secretary of State for Education and Skills how many complaints have been reported in 516W
  her Department under paragraph 11 of the Civil Service Code since 13 May 1999; and how many of them related to special advisers. [25328]

  Mr. Ivan Lewis
  [holding answer 9 January 2002]: The procedures for making complaints under the Civil Service Code are set out in the Department's staff handbook. Civil servants are encouraged, in the first instance, to raise complaints made under paragraph 11 of the Civil Service Code with their line manager. If for any reason this is not felt to be possible, perhaps because the line manager is part of the complaint, individuals may take their complaint to a nominated official (or officials). It is not possible to provide a comprehensive figure for the number of complaints made within this Department under paragraph 11 of the code, as there is no requirement for managers to report centrally details of complaints made under the Civil Service Code which are resolved within the management line.

  Early Education Places
  Mr. Brady
  To ask the Secretary of State for Education and Skills what percentage of three-year-olds in Trafford are in receipt of a free early education place. [25994]

  Margaret Hodge
  [holding answer 11 January 2002]: We are committed to providing all three-year-olds, whose parents want one, with a free nursery education place by September 2004. We have recently announced details of the £275 million of funding we are making available to provide free early education places for three-year-olds in 2002–03. This funding has been initially allocated according to the position of an authority on the Government's Index of Multiple Deprivation. As a result, Trafford LEA has been allocated £335,000 of this funding to provide 275 free early education places.

  Estimates of the percentage of three-year-olds already provided with a place are used nationally for internal planning and monitoring. However, accurate local population figures are not available to the Department, although local authorities may choose to make their own estimates based on local data.

  Speech Therapists
  Mr. Lilley
  To ask the Secretary of State for Education and Skills how many speech therapists qualified for teaching children with special educational needs are in practice in each local education authority in England. [27696]

  Mr. Ivan Lewis
  This information is not collected centrally. Under the Standards Fund, grant support is available to local education authorities to help them enhance speech and language therapy services in conjunction with the NHS and voluntary sector. We have also supported the work of the charity I-CAN on creating a joint professional development framework for teachers and speech and language therapists, to be published shortly.

  Ministerial Transport
  Mr. Bercow
  To ask the Secretary of State for Education and Skills what her estimate is of the cost of(a) ministerial cars and drivers and (b) taxis for her Department in each of the last four years. [27903]
  517W
  Mr. Ivan Lewis
  Nick Matheson, Chief Executive of the Government Car and Despatch Agency (GCDA) which provides ministerial cars and drivers, will be writing separately in response to part(a) of this question.

  It is not possible, even at disproportionate cost, to provide an estimate of the cost of taxis used within my Department in each of the last four years.

  Sixth Form Funding
  Mr. Damian Green
  To ask the Secretary of State for Education and Skills if she will list those local education authorities in England which have indicated that they will be unable to meet the financial provisions for school sixth forms in 2002–03, as specified by the Learning and Skills Council; and if she will make a statement. [28109]

  Mr. Ivan Lewis
  The Learning and Skills Council has issued to LEAs and schools their provisional sixth form funding allocations for 2002–03. These allocations will be confirmed shortly. LEAs will be required to pass on all the money received for sixth forms to the schools.

  Because the way the LSC distributes the funds differs from that formerly used by LEAs, transitional issues have arisen for some authorities. We propose to deal with these by providing extra grant resources for 2002–03 for those authorities most significantly affected, and by allowing more flexibility in the way LEAs fund schools. A letter to this effect was sent to all LEAs on 7 December 2001 and copies have been placed in the Library.

  Mr. Damian Green
  To ask the Secretary of State for Education and Skills if she will list, by local education authority in England, the amounts allocated for 2002–03 to schools with sixth forms, excluding funding for statemented special education needs, by the Learning and Skills Council according to the(a) terms of the Real Terms Guarantee, (b) Learning and Skills Council's methodology and (c) Learning and Skills Council's methodology as modified by the restriction of gains to 30 per cent. above the levels of the Real Terms Guarantee. [28110]

  Mr. Ivan Lewis
  This is principally a matter for the Learning and Skills Council. Their provisional school sixth form allocations were published on 14 December 2001 and are publicly available on the LSC's internet website in the form requested by the hon. Member at www.lsc.gov.uk. The allocations will be confirmed shortly.

  Myalgic Encephalomyelitis
  Dr. Julian Lewis
  To ask the Secretary of State for Education and Skills what guidance she has given to local educational authorities to cater for the needs of children whose education is disrupted by ME. [28221]

  Mr. Ivan Lewis
  On 1 November 2001, the Department for Education and Skills jointly with the Department of Health published new statutory guidance, "Access to Education for children and young people with medical needs". This guidance sets out minimum national standards for the education of children who are unable to 518W
  attend school because of medical needs, and is applicable to children with Chronic Fatigue Syndrome/Myalgic Encephalomyelitis (CFS/ME).

  The Independent Working Group report on CFS/ME was published on 11 January 2002. The Government hope that publication of the report will result in improved awareness and understanding of this condition and lead to improved diagnosis, treatment and management. Advice is given in the report about the education of children and young people with CFS/ME.

  Children's Rights Commissioner
  Mr. Woodward
  To ask the Secretary of State for Education and Skills what recent representations she has received on the establishment of a Children's Rights Commissioner. [27431]

  Mr. Ivan Lewis
  [holding answer 17 January 2002]: My Department has received two letters making representations about a Children's Rights Commissioner in England, one of which was forwarded by the Prime Minister's office.

  Specialist Schools
  Mr. Laws
  To ask the Secretary of State for Education and Skills what her estimate is of the total expenditure on specialist schools in(a) England and (b) Somerset for each year from 1997–98 to 2003–04 (planned); and if she will make a statement. [27043]

  Mr. Timms
  [holding answer 17 January 2002]: Information on the actual and planned expenditure for specialist schools for (a) England and (b) Somerset for each year from 1997–98 to 2003–04 is provided if the table.

  Financial Year

  England (£ million)

  Somerset (£)

  1997–98

  33.1

  247,175

  1998–99

  40.8

  462,660

  1999–2000

  47.4

  523,972

  2000–01

  71.9

  815,716

  2001–02

  94.0

  885,063

  2002–03

  1108.0

  2957,063

  2003–04

  1127.0

  2957,063

  1 Estimates for 2002–03 and 2003–04 are baseline figures for those years based on targets of 1,000 specialist schools by 2003 and 1,500 by 2005.

  2 Estimated expenditure on specialist schools in Somerset for 2002–03 and 2003–04 is based on current pupil numbers in schools already designated.

  Mr. Laws
  To ask the Secretary of State for Education and Skills how many schools have applied for specialist school status in each quarter since May 1997; how many of these schools were granted specialist status in each of these quarters; how many cluster bids have been accepted; and if she will make a statement. [27051]

  Mr. Timms
  The number of specialist school applications received in each competition since May 1997 and the number of schools designated in each round are shown in the table. A small number of "associated applications" have been discussed with officials but no applications which are part of these associated applications have yet been successful.
  519W

  Competitions

  Schools applying

  Number of schools designated

  May 1997

  40

  8

  October 1997

  107

  32

  March 1998

  122

  51

  October 1998

  67

  43

  March 1999

  52

  37

  June 1999

  95

  44

  October 1999

  68

  37

  March 2000

  117

  59

  June 2000

  115

  34

  October 2000

  106

  39

  March 2001

  154

  79

  Note:

  261 applications received in the October 2001 competition are currently being assessed.

  Mr. Laws
  To ask the Secretary of State for Education and Skills how many schools will be granted specialist school status in the bidding rounds during 2002; what proportion this is of the total number of expected bids; and if she will make a statement. [27052]

  Mr. Timms
  It is difficult to estimate the number of bids we will receive this year but it is likely to be at least as many (both in March and October) as in the October 2001 competition, when 261 schools made applications. Our published target is to have at least 830 specialist schools by September 2002. There are 463 specialist schools at present.

  Nurture Groups
  Mr. Laws
  To ask the Secretary of State for Education and Skills what plans she has to establish nurture groups in primary schools in order to give special assistance to young children with social and educational problems; and if she will make a statement. [27047]

  Mr. Ivan Lewis
  The Government recognise the benefit that nurture groups can provide for disaffected young children or those with emotional behavioural and other difficulties (EBD).

  A number of LEAs and schools already use this approach for pupils with EBD. In June 2001, My Department published guidance on promoting children's mental health in early years and school settings, which includes the use of nurture groups as an effective early intervention strategy for young children in schools who have mental health difficulties. In co-operation with the Coram Foundation we will also be publishing guidance later this year on effective strategies for dealing with pupils with behavioural and other difficulties. This will include the use of nurture groups as one of a range of strategies primary schools might adopt. It is for individual schools to decide where it is appropriate for nurture groups to be used depending on the needs of the children and the school's circumstances.

  Launchpad Status
  Mr. Laws
  To ask the Secretary of State for Education and Skills what criteria will be used in determining which schools are awarded launchpad status; and if she will make a statement. [27049]
  520W
  Mr. Timms
  The aim is to include a broad cross-section of primary and secondary schools from across the country, together with a small number of special schools since it is vital that lessons learned from the project have credibility and wide application. We shall be taking into account factors such as school size and location, as well as securing participant schools showing a range of pupil attainment and teacher turnover. We shall want to include schools which are already developing innovative practice and we also plan to ensure there is representation of some in challenging circumstances.

  Student Poverty
  Mr. Laws
  To ask the Secretary of State for Education and Skills if she will publish information possessed by her Department which shows the proportion of students(a) on free school meals, (b) in families dependent on benefits, (c) considered to be from more deprived backgrounds as available indicators, in (i) specialist schools and (ii) non-specialist community and comprehensive schools; and if she will make a statement. [27048]

  Mr. Timms
  Information on the numbers and proportions of pupils eligible for a free school meal for specialist and non-specialist community and comprehensive schools is shown in the following table. Similar information on students in families dependent on benefits and considered to be from more deprived backgrounds is not available.

  England

  Specialist secondary schools

  Number of day pupils

  769,973

  Number of pupils eligible for FSM

  112,865

  Percentage of pupils eligible for FSM

  14.7

  Other maintained secondary schools

  Number of day pupils

  2,457,000

  Number of pupils eligible for FSM

  396,811

  Percentage of pupils eligible for FSM

  16.2

  Source:

  Annual Schools Census (amended December 2001)

  Schools' Reserves
  Mr. Laws
  To ask the Secretary of State for Education and Skills if she will make a statement on the level of schools' reserves; whether the present level of reserves is in excess of guidelines; and if she will make a statement. [27050]

  Mr. Timms
  At the end of the financial year 1999–2000, balances held by maintained schools in England amounted in total to approximately £723 million: this figure is derived from the outturn statements prepared by local education authorities under section 52 of the School Standards and Framework Act 1998, and represents surpluses net of deficits.

  Prudent financial management will normally entail the retention by schools of reasonable reserves, whether on a contingency basis or by way of saving to meet large planned items of future expenditure. In view of the widely varying circumstances of individual schools, my right hon. Friend does not consider that the promulgation of specific guideline figures by the Department would be helpful. It is the responsibility of LEAs to monitor the level of balances in the schools which they maintain, and

  521W
  to challenge those schools whose balances appear, in all the circumstances, to be excessive. Where a school persistently retains a large balance for no clear reason, it is open to the LEA to consider whether delegation should be suspended under section 51 of the School Standards and Framework Act.

  Teachers' Pay
  Mr. Wray
  To ask the Secretary of State for Education and Skills what the average starting salary is for newly qualified teachers in(a) London and (b) the rest of the UK; after how long a newly qualified teacher will receive a pay rise; and if she will make a statement on teachers' pay with special reference to rises they have had since 1997, and pay rises they will receive. [27673]

  Mr. Timms
  A newly qualified teacher in England and Wales with a second class honours degree or above currently starts at point two of the main scale on £17,001 pa. Others start on £16,038 pa. Schools may start teachers higher up the scale to recognise any other experience they consider relevant. Teachers working in inner London receive an extra £3,000 pa; those in outer London receive an extra £1,974 pa and those on the fringe receive an extra £765 pa. All teachers receive a pay increase in April of each year when the pay scales are revalorised. In the early part of their career, teachers will also receive an increment in September when, subject to satisfactory performance, they move up one point on the main qualified teachers' pay scale. Schools have discretion to advance excellent performers by two points in any year. Later in their career, any further pay advancement can be justified only by excellent performance or promotion.

  As a result of the performance threshold system and other pay improvements, good experienced teachers in England and Wales have received an extra 25 per cent. in pay since 1997. This is 17 per cent. in real terms. We have established a new upper pay spine for teachers with a maximum of £31,128. The maximum pay for the advanced skills teacher grade we have introduced is £44,571. Our school leaders can now earn up to £78,783.

  Teachers' pay in England and Wales is based on recommendations made by the independent School Teachers' Review Body (STRB). They are shortly due to publish their report detailing their recommendations for 2002–03. My right hon. Friend will consult key stakeholders before implementing any changes. Scotland and Northern Ireland are responsible for their own pay arrangements for their teachers.

DEPUTY PRIME MINISTER

  Business Regulation
  Dr. Cable
  To ask the Deputy Prime Minister how many new regulations affecting business have been introduced since June 2001; and how many have been repealed. [26764]

  Ms Hewitt
  I have been asked to reply.
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  The Department has proposed 49 regulations to Parliament since June. Of these regulations, more than half were public telecommunications operator licences, amended or simplified regulations or preserved commercial electricity supply agreements.

  Records relating to repealed regulations are not held centrally. The information requested could be obtained and collated only at disproportionate cost.

NORTHERN IRELAND

  Parades
  Mr. McGrady
  To ask the Secretary of State for Northern Ireland what the cost was of policing each parade in Kilkeel and Annalong between 1 April 2001 and 30 September 2001; and if he will make a statement. [25930]

  Jane Kennedy
  There were 19 parades in Kilkeel and Annalong between 1 April 2001 and 30 September 2001. The cost of policing each parade is as follows:

  Parade

  Date

  Cost (£)

  Rising Son of Valley

  21 April

  28,359

  Annalong Single Star

  18 May

  11,269

  Mourne LOL No.6

  27 May

  436

  Pride of Balinaran

  23 June

  42,791

  St. Mary's GAC

  1 July

  269

  Ballymartin LOL

  2 July

  1,458

  Annalong

  2 July

  23,827

  Mourne LOL No. 6

  8 July

  269

  Apprentice/Schomberg

  11 July

  13,037

  Kilkeel District LOL

  12 July

  43,630

  Mourne Defenders

  12 July

  643

  Orange Hall Committee

  28 July

  16,403

  Mourne LOL No. 6

  29 July

  356

  Mourne Defenders

  3 August

  12,814

  Brunswick Accordion

  10 August

  14,954

  AOH

  15 August

  85,636

  Scrogg Road Community

  19 August

  1,106

  Mourne District RBC

  19 August

  1,106

  Mourne District RPB

  25 August

  2,192

  Armed Theft (Belfast)
  Mr. Blunt
  To ask the Secretary of State for Northern Ireland, pursuant to the answer of 8 January 2002,Official Report, column 568W, to the hon. Member for Belfast, North (Mr. Dodds) on armed theft (Belfast), which Republican paramilitary groups the police believe were responsible. [26820]

  Jane Kennedy
  As I stated in my answer to the hon. Member for Belfast, North the police believe that those involved in the robberies had an association to republican paramilitary groups. It is not possible to attribute the robberies to any specific grouping.

  Paramilitary Violence
  Mr. Trimble
  To ask the Secretary of State for Northern Ireland how many(a) shootings, (b) bombings and (c) beatings there were in each of the last six months by (i) Republican paramilitaries purported to be on

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  ceasefire, (ii) Republican paramilitaries not on ceasefire, (iii) Loyalist paramilitaries claiming to be on ceasefire and (iv) Loyalist paramilitaries not on ceasefire. [26883]

  Jane Kennedy
  The following tables provide the security statistics attributed to all Republican and Loyalist groupings. It is not possible to provide attribution by specific groups, purportedly on ceasefire or otherwise.

  Security situation statistics: July to December 2001—number of deaths as a result of the security situation

  By Loyalist

  By Republican

  Total

  July

  2

  0

  2

  August

  0

  0

  0

  September

  1

  0

  1

  October

  1

  1

  2

  November

  1

  0

  1

  December

  2

  1

  3

  Total

  7

  2

  9

  Number of shooting incidents

  By Loyalist

  By Republican

  Other N/K

  Total

  July

  27

  10

  2

  39

  August

  8

  12

  4

  24

  September

  32

  16

  0

  48

  October

  20

  7

  1

  28

  November

  19

  7

  2

  28

  December

  13

  4

  3

  20

  Total

  119

  56

  12

  187

  Notes:

  1. The following types of incidents are included:

  Shots fired by terrorists

  Shots fired by the security forces

  Paramilitary-style attacks involved shootings

  Shots heard (and later confirmed)

  Other violent incidents where shots are fired (eg armed robbery).

  2. Statistics are provisional and may be subject to minor adjustment.

  Number of bombing incidents

  By Loyalist

  By Republican

  Other N/K

  Total

  July

  50

  6

  2

  58

  August

  28

  8

  3

  39

  September

  54

  4

  1

  59

  October

  41

  2

  5

  48

  November

  15

  3

  1

  19

  December

  5

  1

  1

  7

  Total

  193

  24

  13

  230

  Notes:

  1. An individual bombing incident may involve one or more explosive devices. Incidents recorded include explosions and defusings. Incidents involving hoax devices, petrol bombings or incendiaries are excluded.

  2. Statistics are provisional and may be subject to minor adjustment.

  Number of casualties as a result of paramilitary style assaults

  By Loyalist

  By Republican

  Total

  July

  13

  2

  15

  August

  3

  2

  5

  September

  7

  2

  9

  October

  6

  3

  9

  November

  4

  4

  8

  December

  8

  2

  10

  Total

  41

  15

  56

  524W

  Number of casualties as a result of paramilitary style shootings

  By Loyalist

  By Republican

  Total

  July

  8

  5

  13

  August

  10

  11

  21

  September

  8

  11

  19

  October

  10

  2

  12

  November

  12

  2

  14

  December

  7

  4

  11

  Total

  55

  35

  90

  Note:

  Statistics are provisional and may be subject to minor adjustment.

FOREIGN AND COMMONWEALTH AFFAIRS

  Newspaper Advertising
  Mr. Bercow
  To ask the Secretary of State for Foreign and Commonwealth Affairs what has been the expenditure of his(a) Department, (b) agencies and (c) non-departmental public bodies on newspaper advertising by title in each year since 1997. [26987]

  Mr. MacShane
  I refer the hon. Member to the answer I gave to the hon. Member for Twickenham (Dr. Cable) on 19 November 2001,Official Report, column 24W.

  The Foreign and Commonwealth Office, its executive non-departmental public bodies and executive agency have routinely advertised in the domestic press for recruitment purposes. Other than that, expenditure incurred was:

  2001–02: £2,650—Metro (London), The Voice, Time Out1

  2000–01: £8,589—Metro (London)2

  1999–2000: Nil

  1998–99: Nil

  1997–98: Nil.

  1 Promoting the "Know Before You Go" consular campaign.

  2 Publicising an FCO open day.

  In addition, the British Council has advertised for such activities as teacher exchanges, language assistants and conference promotion. Accurate figures by year are not available. But from 1997 to 2001 the total expenditure was £16,400. The expenditure from April 2001 to date is £6,565. The titles used were The Times Educational Supplement (mainly) and The Guardian newspaper.

  Correspondence
  Sir Teddy Taylor
  To ask the Secretary of State for Foreign and Commonwealth Affairs when he intends to reply to the letter of 12 September 2001 from the hon. Member for Rochford and Southend, East about Heathrow airport. [28010]

  Mr. Bradshaw
  [holding answer 17 January 2002]: Unfortunately the letter dated 12 September 2001 from the hon. Member for Rochford and Southend, East about Heathrow airport was lost. Officials have requested a further copy. A reply will be sent as soon as possible.

  Christian Minorities
  Mr. Drew
  To ask the Secretary of State for Foreign and Commonwealth Affairs what help his Department offers other Governments who are in the process of
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  drafting new laws in the areas of (a) religious freedom and (b) cults to ensure that there is no discrimination against Christian minorities. [28314]

  Peter Hain
  Promotion of human rights is at the heart of our foreign policy and we regard freedom of thought, conscience and religion as very important human rights. We condemn instances where individuals are persecuted because of their faith or belief, wherever it happens and whatever the religion of the individual or group concerned.

  We take every opportunity, often working with our EU partners, to urge states to pursue laws and practices which foster tolerance and mutual respect and to protect religious minorities against discrimination, intimidation and attacks. Where necessary, we remind Governments of the need to comply with their international obligations and to uphold freedom of religion.

  We also support, including through financial assistance, the work of the Organisation for Security and Co-operation in Europe and its Office of Democratic Institutions and Human Rights which, inter alia, offer technical assistance on legislation. For example, in 2001, their advisory panel of Experts on Freedom of Religion helped develop a package for Armenian schools on religious tolerance, prepared a draft law on the Status of Religious Associations in Bosnia-Herzegovina, and expanded a website to gather and identify examples of legislative best practice on Freedom of Religion.

LORD CHANCELLOR'S DEPARTMENT

  Legal Profession (Ethics)
  Mr. Allen
  To ask the Parliamentary Secretary, Lord Chancellor's Department what recent discussions the Lord Chancellor has had with the Home Secretary arising from his recent speech about the ethics of the legal profession; and if he will make a statement.

  Mr. Wills
  My right hon. Friend the Home Secretary and the Lord Chancellor have regular meetings on a wide range of matters. As with previous Governments it is not the practice to provide details of confidential discussions.

  Lay Magistrates (Essex)
  Bob Spink
  To ask the Parliamentary Secretary, Lord Chancellor's Department what initiatives are planned to recruit more lay magistrates in Essex. [28417]

  Mr. Wills
  The Lord Chancellor's Advisory Committee for Essex undertakes a range of recruitment activities each year to attract people from across the community to become magistrates. Last year initiatives included adverts in the local press, contacting local trade unions, the Regional Employers Organisation, local ethnic minority groups and the Racial Equality Council, sending them leaflets and offering to give presentations, circulating leaflets and posters to local libraries. This year it plans to continue issuing leaflets to local organisations and include an advert on free street maps, as well as placing adverts in the local press.

HEALTH

  IT Systems
  Mr. Burstow
  To ask the Secretary of State for Health what assessment he has made of the SNOMED system for recording clinical details for all patient activity in other countries. [10282]

  Ms Blears
  The use of the SNOMED system produced by the College of American Pathologists, and in particular SNOMED RT, has been assessed in other countries. The clinical details that it contained were weak in the area of primary care. However, because the Clinical Terms Version 3 (Read Codes) produced by the national health service were strong in the area of primary care the opportunity to have a collaborative project between the NHS and the College of American Pathologists was seized. The combined product, SNOMED CT (Clinical Terms) will contain over 400,000 clinical terms. Other countries and healthcare organisations who have SNOMED RT systems will be upgrading their systems to SNOMED CT when it has been tested and released.

  Social Workers
  Hywel Williams
  To ask the Secretary of State for Health how many social workers were employed in(a) England and (b) Wales in each of the last 10 years. [9264]

  Jacqui Smith
  The whole-time equivalent number of social work staff employed by local authorities in England during the past 10 years is:

  Whole-time equivalent1

  Year (as at 30 September)

  Social work staff

  1991

  25,538

  1992

  26,510

  1993

  28,333

  1994

  30,357

  1995

  31,925

  1996

  32,140

  1997

  32,990

  1998

  33,432

  1999

  33,912

  2000

  34,692

  1 Including team leaders/assistant team leaders and (from 1993) care managers.

  Social work staff includes team leaders, assistant team leaders and (from 1993) care managers, as well as social workers. The Department does not collect just the number of social workers.

  Information for Wales is a matter for the devolved Assembly.

  Midwifery
  Mr. Pollard
  To ask the Secretary of State for Health what plans he has to increase the number of midwife-led birthing units for low risk births; and if he will make a statement. [12008]

  Yvette Cooper
  There are a number of different ways of providing good quality woman-centred midwifery care including care in midwife-led birthing units for low risk births. It is a matter for local health authorities and national health service trusts to decide on the pattern of service provision taking into account the needs of local
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  people, evidence of effectiveness and available resources. The Maternity Workforce Group is looking at alternative models of care.

  NHS Information Authority
  Mr. Todd
  To ask the Secretary of State for Health what steps he will take to address staff turnover within the NHS Information Authority. [15397]

  Ms Blears
  The National Health Service Information Authority had a turnover during the last 12 months of 11.36 per cent. This is compared with a 23 per cent. increase in its staff over the same period. Therefore the overall staffing position was growth.

  Over the past two years the authority has rationalised its offices from 23 to 11. This has invariably caused a need to relocate some staff from one site to another. However, very few staff with key technical skills left the authority because of this. The vast majority supported all staff through this process with appropriate actions—flexible working; home relocation arrangements; teleworking and transport services.

  Significant effort has also been put into the development of a full induction process for new staff joining the authority to ensure, wherever they are located, that they gain an understanding of the purpose, nature and culture of the authority as quickly as possible.

  NHS Dentists (Dorset)
  Mrs. Brooke
  To ask the Secretary of State for Health how many patients in Dorset were registered with an NHS dentist in April(a) 1990, (b) 1995 and (c) 2000. [15786]

  Ms Blears
  [holding answer 21 November 2001]: The number of general dental service registrations in Dorset health authority is shown in the table at 30 April for the years 1995 and 2000. There were no registrations in April 1990; registrations were introduced in October 1990.

  April

  Children

  Adults

  Total

  1995

  100,015

  325,207

  425,222

  2000

  102,704

  274,611

  377,315

  The figures for 1995 and 2000 cannot be compared. Registration rates were reduced by the shortening of the registration period for new registrations from 1996. For adults the period fell from 24 to 15 months. Children's registrations used to lapse at the end of the end of the following calendar year; they now last for 24 months.

  Mrs. Brooke
  To ask the Secretary of State for Health how many dentists in Dorset are taking new adult NHS patients; and how many were taking new adult NHS patients in April 1990. [15787]

  Ms Blears
  [holding answer 21 November 2001]: Almost 66 general dental service dentists in Dorset are estimated to be taking on new adult patients. This is an estimate for August and is based on the number of dentists whose new registrations in August exceeded a minimum level.

  Information for April 1990 about dentists taking on new patients is not available.

  Teenage Pregnancy
  Mr. Bercow
  To ask the Secretary of State for Health what policies have followed fulfilment of the Public Service Agreement target to complete and publish reports on teenage pregnancy for 16 to 18-year-olds not in education. [21260]

  Yvette Cooper
  There is no Public Service Agreement to complete and publish reports on teenage pregnancy for 16 to 18-year-olds not in education.

  Our teenage pregnancy strategy aims to help more teenage parents into education, training or employment. 20 Sure Start Plus pilots are under way, providing personal support for pregnant teenagers and teenage parents on health, education, benefits and housing issues. Nine further pilots are testing how best to provide for child care for teenage parents, to help them access education or work. Teenage parents are also eligible for the education maintenance allowance in areas where this is being piloted, two of which (Cornwall and Stoke) are testing additional flexibilities to meet the needs of teenage parents, including a longer period of eligibility for the allowance. Every local area in England has in place a 10-year multi-agency strategy to tackle teenage pregnancy, including action to improve support for teenage parents. Between 1997 and 2001, the percentage of teenage mothers aged between 16 and 19 in education, training or employment increased from 16 per cent. to 29 per cent.

  Aspergillus Fumigatus Infection
  Dr. Naysmith
  To ask the Secretary of State for Health (1) what plans there are to increase funding available for research into Aspergillus fumigatus infection; [22456]

  (2) what steps are being taken to fund research into (a) the prevention of and (b) diseases contracted via Aspergillus fumigatus infection. [22455]

  Yvette Cooper
  The Department is not funding specific research into the prevention and treatment of Aspergillus fumigatus infections.

  The main Government agency for research into the causes of, and treatments for, disease is the Medical Research Council (MRC) which receives its funding via the Department of Trade and Industry. The Department of Health funds research to support policy and the delivery of effective practice in the national health service.

  The Department of Health provides support for research commissioned by charities and the research councils that takes place in the NHS. Details of on-going and recently completed research projects are available on the National Research Register (NRR) at www.doh.gov.uk/research/nrr.htm.

  There are two on-going projects regarding Aspergillus infection:
  Genome sequencing of Aspergillus fumigatus, supported by the National Institute of Allergy and Infectious Disease
  Transcriptional Regulation of Chitinase Expression in Aspergillus fumigatus and the identification of novel targets for antifungal drugs supported by the Wellcome Trust.
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  The NRR also details 14 completed projects related to Aspergillus fumigatus, one of which was directly supported through the Department of Health's North West Regional Research Programme on DNA fingerprinting of Aspergillus.

  The Public Health Laboratory Service, which receives funding from the Department of Health, recently reviewed all reports of Aspergillus infection between 1990 and 1999. Their findings were reported in the Journal of Epidemiology and Infection 2001, Volume 126, at pages 397 to 414.

  The Department has no plans to increase funding available for research into Aspergillus fumigatus infection.

  The Department keeps its priorities for research under review. Priorities for departmental research for the development of the policy are determined through discussion with policy colleagues, the Departmental Research Committee and Ministers. In the NHS, priorities are identified through widespread consultation with those using, delivering and managing services. They take account of the burden of disease, potential benefits and departmental objectives, as well as the responsibilities and work of other funders.

  Drugs
  Mr. Sanders
  To ask the Secretary of State for Health if he will break down by(a) interventions and (b) drugs for clinical condition and tumour type, the money announced on 5 December; and how many patients will be treated in each category. [22765]

  Yvette Cooper
  The revenue allocations announced on 6 December represent the latest stage in the Government's programme of sustained investment and reform in the national health service set out in the NHS Plan last year. There is only limited earmarking of funds within allocations so that the NHS locally can flexibly manage all the resources available. This means it is not possible to break down the allocations by interventions or by drugs.

  £76 million will be earmarked for cancer services in 2002–03 to ensure that investment gets through to the front line to be spent on the priorities identified by doctors, nurses and other frontline staff. The priorities for action in 2002–03 on cancer were set out in the Priorities and Planning Framework published on 6 December.

  Solihull Hospital
  Mr. John Taylor
  To ask the Secretary of State for Health if he will make a further statement on the future of accident and emergency provisions at Solihull hospital. [22914]

  Yvette Cooper
  The service review of the accident and emergency department at Solihull hospital is continuing.

  The Service Review Group will report to Solihull health authority on its recommendations, with a view to the health authority then launching a public consultation on its preferred option. The review was originally due to report back by the end September, but this has now been extended until early this year.

  Food Supplements
  Mr. Todd
  To ask the Secretary of State for Health what assessment he has made of the implications of omission from the proposed Annexe to the Food Supplements Directive on the future availability of products currently on sale in the UK. [23375]

  Yvette Cooper
  The implications of omission of substances currently used in products sold on the United Kingdom market from the proposed lists depend on future developments in updating these lists. The proposed directive would establish a seven year transitional period during which member states could allow continued use of all these substances. The annexes would then be amended to include additional substances cleared by the European Union Scientific Committee on Foods.

  MMR Vaccine
  Miss Kirkbride
  To ask the Secretary of State for Health what discussions he has had with(a) drug companies and (b) medical organisations on MMR-C; and what plans he has to introduce MMR-C into England and Wales. [24276]

  Yvette Cooper
  None.

  Mrs. Dunwoody
  To ask the Secretary of State for Health what percentage of eligible children in Cheshire have been vaccinated with the MMR vaccine in(a) 2001–02, (b) 2000–01 and (c) 1999–2000; and if he will fund a public campaign to promote the use of the MMR vaccine throughout the north-west of England. [26633]

  Yvette Cooper
  The percentage of children in Cheshire immunised against measles, mumps and rubella by their second birthday and fifth birthday is shown in the table. An England wide MMR information campaign was launched last summer, which provided a range of new material for parents and health professionals including posters, factsheets, videos and leaflets. The materials were also launched onto the national immunisation website www.immunisation.org.uk. The aim of this campaign is to meet parents wishes for clear, factual and accurate information about MMR.

  Percentage of children immunised against MMR

  By their fifth birthday1

  At 31 March

  By their second birthday

  First dose

  First and second dose

  North Cheshire

  1999

  90

  —

  —

  2000

  90

  92

  72

  2001

  88

  92

  75

  South Cheshire

  1999

  89

  —

  —

  2000

  88

  90

  65

  2001

  89

  90

  72

  1 Information about uptake of MMR immunisation at age five was collected for the first time in 1999–2000

  Source:

  Department of Health, Statistics Division SD2B

  Cancer Nurses
  Dr. Fox
  To ask the Secretary of State for Health how many cancer nurse specialists there were in each year since 1997, broken down by type of cancer. [24597]

  Yvette Cooper
  The information requested is not collected centrally.

  Cancer-related Illnesses
  Mr. Barker
  To ask the Secretary of State for Health how many patients treated for cancer-related illnesses within the last 12 months were prescribed courses of treatment(a) approved and (b) awaiting approval by NICE. [25877]

  Yvette Cooper
  Over the last 12 months the National Institute for Clinical Excellence (NICE) have published appraisals on the use of new chemotherapy drugs to treat ovarian, brain, pancreatic, lung and breast cancers as well as leukaemia. Around 19,000 patients each year should now be benefiting from chemotherapy treatments appraised by NICE.

  NICE is currently appraising further treatments for advanced ovarian, breast and colorectal cancers and chronic myeloid leukaemia.

  Smoking Helpline
  Tim Loughton
  To ask the Secretary of State for Health how many people have called the smoking helpline since it was set up. [24302]

  Yvette Cooper
  [holding answer 8 January 2002]: A total of 325,698 people have called the national health service smoking helpline in the inclusive period 1 June 2000 to 2 December 2001.

  Tim Loughton
  To ask the Secretary of State for Health how many people are employed on the smoking helpline; and at what cost. [24304]

  Yvette Cooper
  [holding answer 8 January 2001]: A total of 213 staff, including 49 specialist advisers, are trained to work on the helpline services. The precise numbers engaged at any given time depends upon predicted call volumes.

  The overall budget for the specialist adviser staff in 2001–02 is £285,000. Calls dealt with by the non-specialist service are charged on a per call basis with a budget ceiling of £239,000.

  Tim Loughton
  To ask the Secretary of State for Health how much the smoking helpline cost to set up. [24301]

  Yvette Cooper
  [holding answer 8 January 2002]: Set up costs of the national health service smoking helpline amounted to £37,420.

  Media Injunctions
  Tim Loughton
  To ask the Secretary of State for Health how much his Department has spent in legal fees in each of the last five years in relation to obtaining injunctions against media organisations. [24320]

  Ms Blears
  [holding answer 8 January 2002]: The Department has incurred no legal costs in relation to obtaining injunctions because we have not sought any injunctions against the media in the last five years.

  Bed Blocking
  Mr. Luff
  To ask the Secretary of State for Health how many of the patients awaiting discharge in inappropriately occupied beds in Worcestershire hospitals will have their future care packages funded by(a) the health authority, (b) the county social services department and (c) a combination of both; what the equivalent figures were in January 2001; and if he will make a statement. [26403]

  Yvette Cooper
  Funding arrangements for the number of patients awaiting discharge in inappropriately occupied beds in Worcestershire hospitals 2000–01 are as follows.

  December 2000

  December 2001

  Health authority funded placements

  11

  19

  Social Services funded placements

  9

  11

  Jointly funded placements

  9

  5

  Note:

  The data for each year come from two different sources. The 2001 figures have been taken from the weekly SITREPs, and the 2000 figures have been taken from the 2000–01 Q3 CIC return. Both sets of figures cover the last day in December. The monthly figure is a snapshot for that day, the weekly figure is a snapshot for the week ending 31 December.

  We are investing an extra £900 million in intermediate care to ensure that we can free up acute hospital beds which are being occupied by older people who could be cared for at home or elsewhere, which in turn will speed up accident and emergency admissions. The NHS Plan clearly states that by 2004 we will end widespread bed blocking. To achieve this we have a target of 5,000 extra intermediate care beds and an additional 1,700 non-residential intermediate care places by 2003–04, with 220,000 more people receiving intermediate care services.

  I am advised that Worcestershire county council's allocation of £713,000 from the Government's "Cash for Change" initiative will be used to fund additional residential and nursing home placements, a home care discharge scheme and one off payments to support independent sector homes cost pressures. In addition, Worcestershire health authority received an extra £382,000 in April 2001 to help them prepare for winter pressures.

  Kidderminster Hospital
  Dr. Richard Taylor
  To ask the Secretary of State for Health if he will review the arrangements for the alternative storage of the deceased following the closure of the mortuary at Kidderminster hospital; and if he will make a statement on the implications for costs to families. [26222]

  Yvette Cooper
  I am informed that the coroner, local funeral directors and the Kidderminster and district community health council have been involved in the planning of alternative arrangements for the storage and removal of the bodies of deceased patients from Kidderminster hospital.

  Where the family have already decided upon a funeral director, then arrangements will go ahead as planned. In those cases where a decision has yet to be made, then arrangements have been made with a local funeral directors company for appropriate storage of the deceased, at no cost to the family, until a decision is reached.
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  The trust has confirmed that it sees as a priority the need to maintain a service which treats the deceased with respect and dignity, and which is compassionate in the manner in which it relates to the members of their family.

  Haemophilia
  Mr. Todd
  To ask the Secretary of State for Health what recent representations he has received concerning the availability of recombinant clotting factors to haemophilia patients in England; and if he will make a statement. [26423]

  Yvette Cooper
  Departmental officials discussed the availability of recombinant clotting factors with the Haemophilia Society on 30 November 2001.

  We are actively considering extending the provision of recombinant clotting factors to all haemophilia patients in England when supplies allow. Currently the policy is to provide recombinant clotting factors for new haemophilia patients and children under 16.

  Dr. Fox
  To ask the Secretary of State for Health if he will list the health authorities and trusts in England which provide recombinant clotting factors to haemophiliac patients aged over 16 years. [27244]

  Yvette Cooper
  The information requested is not collected centrally.

  Tuberculosis
  Mr. Breed
  To ask the Secretary of State for Health how many cases of human TB there have been in the United Kingdom since 1995, broken down by year and county. [26753]

  Yvette Cooper
  The number of reported cases of human tuberculosis in the United Kingdom from 1995 to 2000 is shown in the table.

  1995

  1996

  1997

  1998

  1999

  20001

  Northern and Yorkshire

  624

  605

  617

  642

  611

  573

  Trent

  520

  544

  484

  498

  497

  456

  Eastern

  267

  260

  232

  268

  228

  273

  London

  2,024

  2,190

  2,411

  2,444

  2,493

  2,643

  South East

  484

  457

  483

  503

  495

  527

  South West

  202

  201

  212

  213

  209

  228

  West Midlands

  654

  655

  610

  673

  712

  734

  North West

  633

  581

  615

  674

  693

  623

  Wales

  180

  161

  195

  172

  205

  174

  Scotland

  478

  509

  433

  464

  497

  406

  Northern Ireland

  90

  75

  75

  61

  61

  58

  Total

  6,174

  6,238

  6,367

  6,612

  6,701

  6,695

  1 Provisional

  Herceptin
  Mr. Hurst
  To ask the Secretary of State for Health (1) when he expects to receive the findings of NICE regarding the use of the drug Herceptin as treatment for breast cancer; and if he will make a statement; [26962]

  (2) which health authorities in England and Wales have authorised the use of the drug Herceptin as treatment for breast cancer within the national health service. [26960]

  Yvette Cooper
  My right hon. Friend the Secretary of State and the National Assembly for Wales have asked the National Institute for Clinical Excellence (NICE) to appraise Herceptin for the treatment of advanced breast 534W
  cancer, and to issue guidance on its use to the NHS in England and Wales. NICE expects to issue guidance on Herceptin in spring 2002.

  Data on the number of health authorities in England and Wales currently authorising the use of Herceptin is not collected. However, as with all newly licensed treatments in advance of a NICE appraisal, the Department's advice is that funding authorities should consider the clinical evidence available for a specific treatment before making any decision.

  Explosion (Sandhurst)
  Mr. Laurence Robertson
  To ask the Secretary of State for Health what assessment he has made of the health of residents in Sandhurst, Gloucestershire, following the explosion at Cleansing Services Group Ltd.; and if he will make a statement. [26656]

  Ms Blears
  [holding answer 11 January 2002]: Gloucestershire health authority has monitored the health of the residents of Sandhurst following the fire at Cleansing Services Group in October 2000.

  The authority has found that the physical and/or psychological health of a significant proportion of Sandhurst residents was affected following the fire. The majority of physical symptoms experienced resolved within four weeks although a small number of people reported continuing physical symptoms seven months after the incident. The health authority has established a study to monitor the long-term effects of the incident on the community.

  GP Surgeries (North Stoke)
  Ms Walley
  To ask the Secretary of State for Health if he will estimate the areas of unmet needs in respect of access to GP surgeries in North Stoke. [26932]

  Yvette Cooper
  There are 17 general practitioner practices in the locality, and I understand that capacity exists to accept more patients.

  In addition, Stoke (Haywood) walk-in centre opened in June 2000 and has proved popular locally, seeing 21,000 patients in the first 12 months.

  Private Finance Initiative (West Midlands)
  David Wright
  To ask the Secretary of State for Health how many health-related PFI proceeds are(a) under way and (b) being evaluated in the west midlands; and where they are located. [26746]

  Yvette Cooper
  the current private finance initiative schemes that are(a) under way and (b) being evaluated in the west midlands are as follows:

  PFI schemes commissioned

  Sedgley Community Centre (Dudley)

  Black Country Mental Health in-patient facility (Sandwell)

  Stoke-on-Trent Mental Health in-patient facility (Stoke-on-Trent)

  Monyhull Learning Disability in-patient facility (South Birmingham)

  535W
  PFI schemes in build

  Hereford District General Hospital

  Worcester District General Hospital

  Northern Birmingham Mental Health in-patient facility

  Dudley District General Hospital

  PFI schemes in procurement

  Walsgrave District General Hospital and Mental Health in-patient facility (Coventry)

  City Hospital Ambulatory Care Centre (Birmingham)

  Wolverhampton Managed Radiology scheme

  Nationally prioritised schemes in fourth and fifth waves (preparing business cases and planning to place OJEC advertisements in 2002–03)

  University Hospital Birmingham Acute Hospital and South Birmingham Mental Health in-patient facility

  North Staffordshire redevelopment of Acute Hospital site and North Stoke Primary Care Centre (Stoke-on-Trent)

  Walsall Women's and Children's Unit and Ambulatory Care Centre

  Wolverhampton Acute Hospital site rationalisation.

  Community Pharmacists
  Mr. Drew
  To ask the Secretary of State for Health what further plans he has to review the fees paid to community pharmacists for dispensing NHS prescriptions. [26781]

  Ms Blears
  [holding answer 14 January 2002]: We are currently considering representations on this issue from the Pharmaceutical Services Negotiating Committee and others.

  Hospital Investment (Shropshire)
  David Wright
  To ask the Secretary of State for Health what proportion of hospital investment in the last five years in Shropshire has been allocated to the hospitals in(a) Telford, (b) Shrewsbury and (c) Oswestry. [26750]

  'Two week wait' performance: Percentage of patients seen within two weeks for first consultant out-patient appointment when referred urgently by their GP for suspected cancer, and the referral is received by the NHS trust within 24 hours: England

  2000–01

  Quarter 3

  Quarter 4

  Cancer site

  Number of referrals

  Number seen within 14 days

  Percentage seen within 14 days

  Number of referrals

  Number seen within 14 days

  Percentage seen within 14 days

  Breast

  20,540

  19,697

  95.9

  20,356

  19,513

  95.9

  Children's

  1—

  1—

  1—

  127

  125

  98.4

  Lung

  1—

  1—

  1—

  4,359

  4,141

  95.0

  Haematological malignancies including leukaemia

  1—

  1—

  1—

  557

  529

  95.0

  Upper Gastrointestinal

  1—

  1—

  1—

  5,429

  4,990

  91.9

  Lower Gastrointestinal

  1—

  1—

  1—

  9,458

  8,723

  92.2

  Skin

  1—

  1—

  1—

  5,906

  5,499

  93.1

  Gynaecological

  1—

  1—

  1—

  3,722

  3,441

  92.5

  Brain/Central Nervous System

  1—

  1—

  1—

  185

  169

  91.4

  Urological

  1—

  1—

  1—

  4,714

  4,034

  85.6

  Head and Neck

  1—

  1—

  1—

  2,613

  2,524

  96.6

  Sarcomas

  1—

  1—

  1—

  122

  114

  93.4

  Other Cancers

  1—

  1—

  1—

  234

  222

  94.9

  1 Not collected

  536W
  Yvette Cooper
  The total capital allocations to the three national health service trusts in Shropshire during the four-year period 1998–99 to 2001–02 are shown in the table.

  £ million

  Percentage

  Telford (Princess Royal Hospital NHS Trust)

  10.9

  37

  Shrewsbury (Royal Shrewsbury Hospital NHS Trust)

  11.7

  40

  Oswestry (Robert Jones and Agnes Hunt Orthopaedic Hospital NHS Trust)

  6.6

  23

  Total

  29.2

  100

  Note:

  The information requested is only available for the last four financial years (1998–99 to 2001–02 inclusive).

  Cancer Patients
  Dr. Fox
  To ask the Secretary of State for Health (1) what percentage of patients in each cancer speciality referred by their general practitioners are referred(a) urgently and (b) non-urgently; [27233]

  (2) how many patients in each cancer specialty were referred by their general practitioners, (a) urgently and (b) non-urgently, in the last year for which figures are available; [27231]

  (3) what percentage of patients in each cancer speciality referred to by their general practitioners as (a) urgent and (b) non-urgent are seen within a month. [27232]

  Yvette Cooper
  The two-week out-patient waiting time standard was introduced for urgent cases of suspected breast cancer from April 1999 and was extended to all other urgent cases of suspected cancer during 2000. Performance data against the standard are shown in the table. Data for non-urgent referrals are not collected centrally.

  Full implementation of the maximum target wait of one month from diagnosis to their first definitive treatment for breast cancer was introduced on 31 December 2001. Central monitoring began on 1 January 2002 and data will be published later in the year.
  537W

  2001–02

  Quarter 1

  Quarter 2

  Cancer site

  Number of referrals

  Number seen within 14 days

  Percentage seen within 14 days

  Number of referrals

  Number seen within 14 days

  Percentage seen within 14 days

  Breast

  21,918

  21,001

  95.8

  23,039

  21,624

  93,9

  Children's

  107

  107

  100.0

  105

  102

  97.1

  Lung

  4,328

  4,028

  93.1

  4,217

  3,991

  94.6

  Haematological malignancies including leukaemia

  537

  507

  94.4

  650

  625

  96.2

  Upper Gastrointestinal

  5,775

  5,296

  91.7

  6,604

  6,041

  91.5

  Lower Gastrointestinal

  10,562

  9,468

  89.6

  12,235

  10,975

  89.7

  Skin

  8,419

  7,690

  91.3

  10,314

  9,120

  88.4

  Gynaecological

  4,400

  4,035

  91.7

  5,423

  4,960

  91.5

  Brain/Central Nervous System

  199

  180

  90.5

  260

  241

  92.7

  Urological

  5,185

  4,444

  85.7

  6,596

  5,573

  84.5

  Head and Neck

  3,452

  3,212

  93.0

  4,169

  3,936

  94.4

  Sarcomas

  138

  130

  94.2

  139

  125

  89.9

  Other Cancers

  378

  360

  95.2

  353

  337

  95.5

  Source:

  Department of Health form QMCW

  Heart Disease
  Dr. Fox
  To ask the Secretary of State for Health what the death rate per 100,000 among people aged under 65 years due to heart disease was in each of the last five years for which figures are available. [27364]

  Yvette Cooper
  The European age standardised death rates per 100,000 population from ischaemic heart disease aged under 65 in the United Kingdom is shown in the table.

  Year

  Persons

  1996

  41.7

  1997

  39.2

  1998

  37.3

  1999

  34.1

  2000

  32.1

  Children's Hospices
  Dr. Fox
  To ask the Secretary of State for Health what funding was given to each children's hospice in the last year by his Department. [27249]

  Yvette Cooper
  The information requested is not collected centrally.

  Small Bowel Transplantation
  Dr. Fox
  To ask the Secretary of State for Health what progress has been made on developing and extending the availability of small bowel transplantation. [27349]

  Yvette Cooper
  We recognise this is a very important national service and good progress has been made in making it available to those who might benefit from the procedure. Both adult and paediatric small bowel transplantation services have been designated by the National Specialist Commissioning Advisory Group and national centres identified since April 1997.

  No transplants were performed before this date. In the case of children, 14 transplants have now been performed. In the case of adults, a number of patients have been assessed but to date transplantation has not been the preferred option for their care.

  Aggregates Levy
  Mr. Lidington
  To ask the Secretary of State for Health what provision he has made in his hospital building programme for additional costs resulting from the aggregates levy. [26511]

  Mr. Hutton
  [holding answer 14 January 2002]: Any additional costs arising from the levy may be factored into bidders proposals under both the private finance initiative and public capital procurement routes. Such bids will continue to be assessed on a case-by-case basis by individual national health service trusts on the grounds of meeting service need, affordability and value for money.

  NHS Appointments
  Dr. Richard Taylor
  To ask the Secretary of State for Health if he will list appointments to chairs of NHS trusts made by the NHS Appointments Commissioner for the west midlands. [27408]

  Yvette Cooper
  The chair appointments made by the National Health Service Appointments Commission to NHS trusts in the west midlands are as follows:

  Chair appointment

  NHS trust

  Professor Margaret Bamford

  Dudley Priority Health

  Mr. Charles Goody

  Coventry Healthcare

  Mr. Bryan Knight

  Sandwell Healthcare

  Mr. Francis McCarney

  George Eliot Hospital

  Mr. Michael O'Riorden

  Worcestershire Acute Hospitals

  Dr. Bransby Thomas

  South Warwickshire Combined Care

  Mr. Clive Wilkinson

  Birmingham Heartlands and Solihull (Teaching)

  Sir Bernard Zissman

  Good Hope Hospital

  BCG Vaccination
  Dr. Tonge
  To ask the Secretary of State for Health what his future policy is for BCG vaccination; and if he will make a statement on the availability of the vaccine. [27593]

  Yvette Cooper
  Our recommendation for the use of BCG vaccine is based on the advice of an independent expert advisory committee, the Joint Committee on Vaccination and Immunisation, which is regularly reviewed.
  539W
  BCG vaccine is readily available to all those recommended to receive it. These include:
  Health service staff who may have come in contact with infectious patients or their specimens.
  Veterinary or other staff who handle animal species known to be susceptible to tuberculosis.
  Staff of prisons, old people's homes, refugee hostels and hostels for the homeless.
  Contacts of cases known to be suffering from active pulmonary tuberculosis.
  Immigrants from countries with a high prevalence of TB, their children and infants wherever born.
  Those intending to stay in Asia, Africa, central or south America for more than a month.
  School children between the ages of 10 and 14 years.

  This policy is set out in the booklet "Immunisation against Infectious Disease 1996".

  Alternative Blood Therapies
  Mr. Havard
  To ask the Secretary of State for Health when the appropriate use of blood working group will publish its report on the use of alternative blood therapies in place of transfusing blood. [27502]

  Yvette Cooper
  [holding answer 15 January 2002]: The National Blood Service "appropriate use of blood" group is currently gathering evidence on alternatives to blood, bloodless surgery and autologous blood transfusion. Proposed guidance material will be considered by the Chief Medical Officer's National Blood Transfusion Committee later this year. It is anticipated that the guidance will be promulgated through regional and local hospital blood transfusion committees.

  Avon/Gloucestershire and Wiltshire Health Authority
  Mr. Drew
  To ask the Secretary of State for Health when he expects to make an announcement on the appointment of a chief executive for the new Avon/Gloucestershire and Wiltshire health authority; and for what reason it has not been possible to make that appointment already. [27314]

  Ms Blears
  [holding answer 15 January 2002]: The appointment of Mr. Mark Outhwaite as chief executive was announced on 14 January. It was not possible to complete the process of making appointments to all 28 strategic health authorities before Christmas and the intervening holiday period inevitable imposed a delay. Now that the appointment has been made, work on setting up the new health authority and preparing it for its role will go ahead at the same speed as other areas.

  Sodium Consumption
  Mr. Gummer
  To ask the Secretary of State for Health what the Food Standards Agency's position is on the acceptable level of daily sodium intake for the general population; on what evidence the Food Standards Agency bases its policy on dietary salt consumption; and what recent advice the Food Standards Agency has given Ministers regarding the recommended daily sodium consumption. [27693]
  540W
  Yvette Cooper
  The Food Standards Agency's advice on salt is that individuals should reduce their intake to 6 grammes per day (equivalent to 2.3 grammes of sodium). This is based on the recommendations made by the expert committee on Medical Aspects of Food Policy.

  Mr. Gummer
  To ask the Secretary of State for Health what public awareness campaigns the Food Standards Agency is undertaking to reduce daily human consumption of salt; how the Food Standards Agency communicates its recommended daily intake of sodium to the public; and what media outlets the Food Standards Agency uses to highlight its policy on salt and its recommended daily intake of sodium. [27694]

  Yvette Cooper
  Advice to the general public on levels of salt intake is covered as an integral part of Food Standards Agency activity to provide information on a healthy balanced diet generally. This is done through a variety of routes which include FSA publications, the FSA website, and advice to the food industry on the nutritional labelling of foods.

  Breast Cancer
  Mr. Hammond
  To ask the Secretary of State for Health if he will make it his policy that women who have suffered pre-menopausal breast cancer will be subject to automatic recall under the NHS breast cancer screening programme. [27756]

  Yvette Cooper
  National guidelines1 state that women who have been treated for breast cancer should undergo mammography yearly during the first five years after surgery, and every two years afterwards, regardless of age. The national health service breast screening programme invites women aged 50 to 64 for mammography every three years, to be extended to the age of 70 by 2004. It is for a woman's clinical team to decide whether she enters the breast screening programme at age 50 or if she is monitored outside the programme.
  1 Improving Outcomes in Breast Cancer: The Manual (July 1996). This is being updated for publication in 2002.

  NHS Complaints Procedure
  Mr. Horam
  To ask the Secretary of State for Health if he will alter the NHS complaints procedure so that independent review bodies can investigate a complaint relating to more than one NHS body. [26013]

  Ms Blears
  [holding answer 15 January 2002]: We are currently in the process of reforming the national health service complaints procedure and as part of that we are considering how best a second, "independent review" element of the procedure might work.

  Food Allergies
  Dr. Kumar
  To ask the Secretary of State for Health what research has been conducted into the underlying causes of food allergies to commonly available ingredients, with particular reference to(a) wheat, (b) dairy products and (c) nuts. [27852]

  Yvette Cooper
  The Food Standards Agency is currently spending £800,000 a year on research into food allergy. This research focuses both on the occurrence of food allergies and the mechanisms underlying the reactions with emphasis on severe allergy, in particular
  541W
  peanut and tree-nut allergies. The FSA currently funds 12 research projects on peanut allergy (the main cause of food allergy related deaths in the United Kingdom) and one on dairy products. The FSA does not currently fund any research into wheat allergy, although the research on mechanisms may be of relevance. Further detail on the food allergy research programme can be obtained from the FSA research programmes annual report 1999–2000 which has been placed in the Library.

  NHS Trusts (Worcestershire)
  Mr. Luff
  To ask the Secretary of State for Health when the chairmanship of the South Worcestershire Primary Care Trust will be announced; and if he will make a statement. [28242]

  Yvette Cooper
  [holding answer 17 January 2002]: Proposals for the establishment of the South Worcestershire Primary Care Trust are still being considered. A decision will be announced as soon as possible.

  vCJD
  Mr. Wiggin
  To ask the Secretary of State for Health how many people have died from vCJD since August 1990; and how many were vegetarian. [28390]

  Yvette Cooper
  Up to 7 January 2002 there have been 104 deaths from variant Creutzfeldt-Jakob Disease (VCJD) within the United Kingdom. Four out of the 104 were vegetarians during some period of their lives but none were lifelong vegetarians.

  EU Health Council
  Annabelle Ewing
  To ask the Secretary of State for Health which representatives briefed his Department on devolved Scottish matters in preparation for the EU Health Council in Brussels on 15 November; and on what issues. [28682]

  Yvette Cooper
  Scotland's interests were represented at the November Health Council by the United Kingdom delegation led by the Minister of State for Health (Mr. Hutton), who represented all parts of the United Kingdom. There are regular communications between the Department of Health and the Scottish Executive on European Union health matters, but specific discussions are conducted on a confidential basis.

  Correspondence
  Mr. Gamier
  To ask the Secretary of State for Health when he will answer the letter dated 30 July 2001 from the hon. and learned Member for Harborough concerning a constituent child protection social worker suspended by Leicester city social services department. [28583]

  Jacqui Smith
  We have transferred the letter to my right hon. Friend the Secretary of State for Transport, Local Government and the Regions and he will be responding shortly.

  Nurses
  Mr. Wray
  To ask the Secretary of State for Health what the starting annual salary is for newly qualified nurses in and(a) London (b) the rest of the UK; after how
  542W
  long a newly qualified nurse will receive a pay rise; and if he will make a statement on nurses' pay, with special reference to rises they have had since 1997, and pay rises they will receive. [27674]

  Mr. Hutton
  The annual starting salary for a newly qualified nurse working full-time in inner London is £19,178 (including London allowance and cost of living supplements). For staff working outside London and the south of England the annual starting salary for a newly qualified nurse working full-time is £15,445.

  Newly qualified nurses normally enter the clinical grading structure on the first pay point on Grade D with annual progression through a further three points until they reach the scale maximum.

  We accepted in full the recommendation of the Review Body for nursing staff, midwives and health visitors and professions allied to medicine for pay in 2002–03. From 1 April 2002 all nurses, midwives and health visitors will receive an increase of at least 3.6 per cent. Pay has increased across the board for all nurses by at least 26 per cent. in cash terms since 1997.

HOME DEPARTMENT

  Immigration and Nationality Directorate
  Mr. Love
  To ask the Secretary of State for the Home Department if he will list the(a) budgeted, (b) actual and (c) projected expenditure by the Immigration and Nationality Directorate in each year from 1995 to the end of the current comprehensive spending review period; and if he will make a statement. [25744]

  Angela Eagle
  The following sums have been allocated to and spent by the Home Office Immigration and Nationality Directorate since 1994–95.

  £ million

  Budgeted

  Actual expenditure

  1994–95

  186

  187

  1995–96

  207

  202

  1996–97

  223

  216

  1997–98

  226

  207

  1998–99

  223

  214

  1999–2000

  794

  857

  2000–01

  1,199

  1,251

  2001–02

  976

  —

  2002–03

  990

  —

  2003–04

  1,045

  —

  Figures include capital expenditure and are in cash terms until 2000–01 and resource terms thereafter.

  A significant portion of the overall budget from 1999–2000 onwards relates to asylum support. Up to 1998–99, the budgets were assigned to and expenditure incurred by the Department of Social Security and the Department of Health and not by the Immigration and Nationality Directorate. The sums spent are set down in a reply given by the then Home Secretary, my right hon. Friend the Member for Blackburn (Mr. Straw) to the hon. Member for Ribble Valley (Mr. Evans) on 9 May 2000, Official Report, column 331W. The budgets for this year and for the two following years are provisional and may be amended following the conclusion of on-going discussions with Her Majesty's Treasury.
  543W
  I shall write to my hon. Friend when I have additional information on the budget and projected expenditure for this year.

  Mr. Nigel Jones
  To ask the Secretary of State for the Home Department (1) if the Immigration and Nationality Directorate is meeting its target for granting applications for indefinite leave to remain in the United Kingdom as a spouse; and if he will make a statement; [22146]

  (2) if the Immigration and Nationality Directorate is meeting its target for granting applications for extensions to visas to study in the United Kingdom; and if he will make a statement. [22147]

  Angela Eagle
  We aim to decide 70 per cent. of all new general and settlement applications within three weeks but at present it is taking up to eight weeks to consider new straightforward applications. The reasons for this are (i); the exceptionally high number of new applications received this year, and especially, in recent months; and (ii) process changes that are being introduced. We are working to reduce this to three weeks or less as soon as possible. Because of the high intake, those cases which require more detailed consideration are currently taking six months or a little more to complete.

  Mr. Drew
  To ask the Secretary of State for the Home Department if he will make a statement on levels of employment at the Immigration and Nationality Directorate at Croydon. [26784]

  Angela Eagle
  [holding answer 14 January 2002]: At March 1999, an estimate of the full-time equivalent figure for the number of staff employed in the Immigration and Nationality Directorate in Croydon was 1,920. On 1 October 2001, this figure had risen to 3,940. This includes staff dealing with immigration casework as well as those who work in a support function.

  European Arrest Warrant
  Mrs. Dunwoody
  To ask the Secretary of State for the Home Department if he will announce the date on which legislation to introduce extradition under the European arrest warrant will be introduced. [26605]

  Mr. Bob Ainsworth
  We have made our commitment to an Extradition Bill clear and measures will be brought before the House in the usual way.

  Mr. Cash
  To ask the Secretary of State for the Home Department what are the criteria for determining the competent authorities in each of the EU member states as to who are to be their issuing and executing judicial authorities in respect of Article 6 of the Council Framework Decision relating to the European arrest warrant. [26950]

  Mr. Bob Ainsworth
  The Framework Decision on the European arrest warrant and the surrender procedures between member states stipulates at Article 1(1) that"the European arrest warrant shall be a court decision."

  At Article 6(1) it further stipulates that:
  "The issuing judicial authority shall be the judicial authority of the issuing state which is competent to issue an arrest warrant by virtue of the law of the issuing state";
  544W
  and at Article 6(2) that:
  "The executing judicial authority shall be the judicial authority of the executing state which is competent by virtue of the law of the executing state".

  By this the Framework Decision makes clear that the issuing and executing authorities must be judicial authorities, but the criteria that the member states may apply to determine which of their judicial authorities shall be responsible for the issuing and execution of European arrest warrants are left to each member state to decide upon. This is consistent with Article 34.2 (b) of the Treaty on European Union, under which the Framework Decision has been negotiated, which states that:
  "Framework decisions shall be binding upon the member states as to the results to be achieved but shall leave to the national authorities the choice of the form and methods".

  Mr. Cash
  To ask the Secretary of State for the Home Department if he will list the offences in English law to which Article 2(2) of the Council Framework Decision relating to the European arrest warrant refers which are punishable under the law of an issuing member state by a sentence of three years and where dual criminality is not required. [26951]

  Mr. Bob Ainsworth
  The list at Article 2(2) is not intended to be an exhaustive list of all the serious criminal offences under the national law of all member states. To answer this question in full would require listing all the offences in English law which might fall under one of the generic headings of offences in Article 2(2) of the Council Framework Decision on the European arrest warrant, and which are punishable by a maximum sentence of at least three years, and cross-referring them to all the offences in the penal codes of the other member states of the European Union (EU) which fall under these headings which are punishable by this sentence. The generic headings listed at Article 2(2) relate to conduct for which there are criminal sanctions in all the member states of the EU, even if the legal definitions of the offences do not precisely match. On any warrant, the offence for which surrender is sought will be framed by the issuing judicial authority under its national law.

  Examples of such offences in English law, to which there is a likely equivalent in the law of other member states are: under the heading of "illicit trafficking in narcotic drugs and psychotropic substances"—drug trafficking offences involving Class A or Class B drugs; under the heading of "terrorism"—offences under the Explosive Substances Act 1883 and offences under the Terrorism Act 2000 as amended by the Anti-Terrorism, Crime and Security Act 2001; under the heading of "rape"—rape and serious sexual offences; under the heading of "swindling"—offences under the Theft Acts 1968 and 1978 that carry a sentence of at least three years; and under the heading of "racism and xenophobia", offences relating to incitement to racial hatred, racially aggravated offences and racial discrimination under the Race Relations Act, where a sentence of at least three years applies.

  In-sourcing
  Paul Flynn
  To ask the Secretary of State for the Home Department what work previously out-sourced from Government Departments to the private sector he plans to in-source back to Departments. [26032]
  545W
  Mr. Blunkett
  Where provision of a service has been contracted out to a private company, any decision on future delivery will be based on value for money considerations, including performance and departmental requirements. We currently have no plans to bring back into the core Home Office any services which have been contracted out.

  Credit Card Fraud
  Mr. Sheerman
  To ask the Secretary of State for the Home Department (1) how many people were found guilty of credit card fraud in each of the past 10 years; [27370]

  (2) what the cost was of credit card fraud in each of the past 10 years. [27371]

  Mr. Keith Bradley
  The Home Office Court Proceedings database is unable to distinguish offences of credit card fraud from other types of fraud as the circumstances of individual offences are not collected centrally.

  The following table shows the number of persons found guilty or cautioned for all offences of 'other fraud' (as distinct from fraud by a company director or false accounting) for the years 1991 to 2000:

  Persons found guilty or cautioned for 'other fraud' in England and Wales, 1991 to 2000

  Number

  1991

  22,775

  1992

  23,429

  1993

  21,178

  1994

  21,035

  1995

  19,807

  1996

  19,394

  1997

  19,442

  1998

  21,760

  1999

  22,191

  2000

  20,904

  Information on the cost of credit card fraud is not collated by the Home Office. However, the Association of Payment Clearing Services has estimated the cost of reported losses due to credit card fraud over the last five years as:

  £ million

  1996

  97.1

  1997

  122.0

  1998

  135.0

  1999

  188.4

  2000

  292.6

  Source:

  APACS Fraud in Focus 2001

  Work Permits
  Lembit Öpik
  To ask the Secretary of State for the Home Department what plans his Department has to change the rules governing the issuing of work permits to Lithuanian citizens; and if he will make a statement. [27832]

  Angela Eagle
  There is no differential between nationalities when considering a work permit application. The decision is determined by whether the application meets the criteria of the work permit arrangements.

  Ministerial Travel
  Bob Russell
  To ask the Secretary of State for the Home Department when he last used the railway service in connection with his official duties; what station he left from and what was the destination; and whether it is his intention to make greater use of the railways in future. [28090]

  Mr. Blunkett
  All arrangements for official travel are made in line with the guidance set out in Chapter 7 of the Ministerial Code, and the accompanying guidance document "Travel by Ministers", using the most efficient and cost effective mode of transport, and bearing in mind security considerations. My last official visit by train was on 11 December last year to address the Balsall Health Forum in the west midlands. For this visit I returned to London by rail from Birmingham New Street to London Euston. I intend to continue using the railway for official travel whenever this is practical.

  I almost always travel to and from my constituency by rail, undertaking official duties in and around the area of Sheffield. The last official engagement on such a visit was on Friday 11 January.

  Child Asylum Seekers
  Paul Flynn
  To ask the Secretary of State for the Home Department what assessment he has made of the motivation of(a) child asylum seekers and (b) those who facilitate their journeys; and if he will make a statement. [28112]

  Angela Eagle
  [holding answer 17 January 2002]: We have not assessed the motivation of child asylum seekers. All asylum applications, regardless of the applicant's age, will be considered in accordance with the criteria set out in the United Nations convention relating to the status of refugees.

  There is no common motivation for those facilitating child asylum seekers. Some will act altruistically, others to improve the economic or educational prospects of family members. But there are many whose motivation is profit and the involvement of organised people smuggling gangs is becoming increasingly common.

  Visas
  Mr. Gummer
  To ask the Secretary of State for the Home Department what information is given to applicants for a new student visa about the length of time that they may be without their passport. [23635]

  Angela Eagle
  Information about the likely time scale for considering applications for leave to remain is quoted in the relevant application form and on the Immigration and Nationality Directorate website. The website is updated regularly. Since 1 January 2002, all new applications for leave to remain are being acknowledged. The acknowledgement letter indicates the likely time scale for the application to be considered. If, on initial consideration, the application cannot be decided for whatever reason, another letter giving a further indication of the likely time scale is sent to the applicant.

  Mr. Gummer
  To ask the Secretary of State for the Home Department (1) what standards of service he sets for processing individual applications for visa renewals; [23633]
  547W
  (2) for what reasons the visa office estimate that the renewal of a one year student visa will take at least five weeks. [23636]

  Angela Eagle
  We aim to decide 70 per cent. of all new general and settlement applications within three weeks but at present it is taking up to eight weeks to consider new straightforward applications. The reasons for this are (i) the exceptionally high number of new applications received this year, and especially, in recent months; and (ii) process changes that are being introduced. We are working to reduce this to three weeks or less as soon as possible.

  Passports
  Mr. Chope
  To ask the Secretary of State for the Home Department what the minimum period is within which a British passport holder can obtain an emergency replacement in the event of loss or theft; and what the minimum period was prior to 14 January. [28424]

  Angela Eagle
  On 14 January the Passport Service introduced two new guaranteed services at its public counters. These are a same day service at £75 for a standard passport and a one week service at £60 for a standard passport. The standard two week service (non-guaranteed) remains available for postal application. The same day service is not available for first passport applications because of the time needed to complete checks on identity. Applications to replace lost or stolen passports are dealt with in the same way as first applications, because the high incidence of fraud makes it necessary to check identity and records of the previous issue. This means that the fastest service normally available for replacement of a lost or stolen passport is the guaranteed one week service.

  Exceptionally, in the case of a genuine emergency involving travel for compassionate reasons or business purposes, a same day service can be provided. Prior to 14 January, services were not guaranteed and turnaround
  548W
  times would depend on factors such as the volume of applications being dealt with and the relative difficulty of establishing identity in the individual case. The change is intended to help customers by providing a choice of services with guarantees for those who need a fast service, while protecting the integrity of the British passport.

  Mr. Chope
  To ask the Secretary of State for the Home Department on how many occasions in each of the last five years the Passport Office Agency has paid compensation to its customers; and what was the total sum of such compensation. [28423]

  Angela Eagle
  The total number of compensation payments made to customers of the United Kingdom Passport Service over the last five years is given in the table together with the amounts for each year.

  Number of payments

  Total amount of compensation (£)

  1997

  1,557

  42,303

  1998

  2,086

  60,610

  1999

  5,142

  344,984

  2000

  2,478

  110,306

  2001

  2,193

  71,955

  Asylum Seekers
  Bob Spink
  To ask the Secretary of State for the Home Department what plans he has to provide additional accommodation for asylum seekers in Essex; and in which towns. [28419]

  Angela Eagle
  It is current policy to disperse asylum seekers away from London and the south-east. In his statement on 29 October last year my right hon. Friend the Home Secretary made it clear that the policy of dispersing asylum seekers away from London and the south-east would continue. I can confirm that to date the Immigration and Nationality Directorate has not identified any areas in Essex suitable for use as cluster areas for the dispersal of asylum seekers.

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

Tobacco Advertising and Promotion Bill [H.L.]
Lord Clement-Jones: 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 Clement-Jones.)
On Question, Motion agreed to.
House in Committee accordingly.
[The PRINCIPAL DEPUTY CHAIRMAN OF COMMITTEES (Lord Brabazon of Tara) in the Chair.]
Clause 7 [Developments in technology]:
On Question, Whether Clause 7 shall stand part of the Bill?
Lord Lucas: My purpose in opposing this Question is mostly to try to find out what the Government intend to do with the clause. I am interested by both its breadth and its narrowness.
I turn first to its breadth. I cannot understand why the Government want to amend the Bill as, if we agree to the amendments that have been indicated, it will deal with any development that I can foresee in electronic publishing. That involves a very wide power, which would allow the safeguards that are being put into the Bill to protect Internet service providers and others—intermediaries in electronic publishing—to be removed merely because it had become convenient to the Secretary of State and related to some change that he perceived in the world of electronic publishing. I should be grateful if the Minister would set out for me his view of the way in which the power will be used and illustrate the circumstances in which he believes it will be necessary.
I am also interested in the clause's narrowness. I do not quite know what "electronic" publishing means in this context. Electronics is currently used in almost every aspect of publishing by any means. I presume that in this context the provisions are limited to the situation in which electronics is in some way a medium of transmission. But what will happen if in future years optics or magnetics become the method by which information is transmitted? Both of those areas are being researched and might well become the way
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things are done in future. I do not understand what the scope and limitations are on the phrase, "by electronic means". I should be grateful if the Minister would elucidate that for me; or perhaps the proposer of the Bill is the expert on that matter. I shall wait to see.
Lord Skelmersdale: My Lords, as Members of the Committee can see from the Marshalled List, I also put my name to the proposal to leave out Clause 7. I did so as a procedural device and not because I believe that the clause should be left out.
I added my name to the Marshalled List so that I could question the Minister further on a point that he answered—alas, only partially—on Second Reacting. At that time, I asked whether the Bill should be notified to the Commission under the Technical Standards Directive. That has proved to be something of a moving target. It was first raised by my noble friend Lord Northesk at Second Reading of the Government's Bill on this subject. On that occasion, the Minister replied that he felt that there was no need.
The Minister's answer was rather different when I asked a similar question at this Bill's Second Reading. He said:
"In relation to the Technical Standards Directive, I am advised that, since the Bill covers advertising rather than technical specifications relating to goods, it is not notifiable in its entirety. However, where the Bill would affect specifications applicable to goods, such as the brand-sharing provisions, the Bill provides for regulations to be made which could be notified under the Technical Standards Directive following due consultation".—[Official Report, 2/11/01; col. 1704.]
I was very pleased with the Minister's answer so far as it went. Products that are covered by primary or secondary legislation are indeed notifiable. However, I am afraid that the Minister's advisers did not delve quite as deeply as they might have into the intricacies of EC product law as that applies throughout the member states. Since Second Reading, I have discovered that the Netherlands, as well as Denmark, to which I referred at Second Reading, notified the terms of its tobacco advertising legislation under the Technical Standards Directive before—this is the important point—passing it into law and not merely because of covering products.
The original legislation is now much wider than it was when it first passed into law. It now covers information technology services in addition to mere products under the amending directive EC 98/34. Very conveniently, the consolidated version is available in the House of Lords Library. It is apparent from Article I of that combined directive that it most definitely applies to any piece of domestic legislation that covers services,
"normally provided for remuneration, at a distance, by electronic means and at the individual request of a recipient of services";
in other words, Internet, fax and telephone trading, with which great chunks of the Bill are concerned. Notification to the Commission is to he made whenever a new or amended national standard is arrived at.

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Members of the Committee may ask why the Government agreed to that. The Minister—perhaps inadvertently; I should hate to do him an injustice—said at Second Reading:
"I share the concerns of my noble friend Lord Mitchell to ensure consistency of approach;"
that is, in Internet matters—
"that is absolutely right. I understand the concerns of the Internet service providers. I have met them. The Government would look sympathetically at amendments which might be seen to deal with specific problems they encounter".—[Official Report, 2/11/01; col. 1704.]
That is all well and good. Perhaps the Minister's answer to my noble friend is that Clause 7 could in certain circumstances provide for that. Therefore, we agree on that point.
However, I press the Minister rather further. Will he now refer not only regulations on brand-sharing but the clauses covering Internet trading and their subsequent statutory instruments to the Commission? At the speed that debates on the Bill are currently progressing, that will hardly delay the passage of the Bill through Parliament. It would be asking too much to request a considered response today, but I ask the Minister to write to me and to other noble Lords who are interested in the computer aspects of the Bill with his considered view on this point: in other words, whether EC 98/48 applies to the Bill and, if not, why not?
11.15 a.m.
Lord Geddes: It was, and still is, to my regret that I was abroad in Australia on the day that the Bill received its Second Reading on 2nd November and I have not been able to attend the two days of the Committee stage since then. Therefore, I apologise to the Committee for intervening at all. This is the first occasion on which I have been able to declare an interest as a member of the Lords and Commons Pipe and Cigar Smokers' Club, whose tie I am proudly wearing this morning.
I have only one point to raise and that is by way of a question to the Minister. As I understand it, the e-commerce directive was due to have been signed by the United Kingdom yesterday. Can I ask the noble Lord whether it was so signed and, if it was not, when will it be signed? Until it is signed, how on earth can this clause stand part of the Bill when we do not know exactly what the e-commerce directive will or will not say?
The Earl of Erroll: I want to ask a brief question. I read this clause and wondered why such wide powers are needed. The clause states that the Secretary of State will have the power to,
"amend any provision of this Act … in consequence of any developments in technology".
Does that limit only parts of the Act which will deal with technology? In other words, can the power be used to change matters only as a result of developments in technology or, if there is a
1250
development in technology, can it then be used to amend any provision in the Act which may not relate directly to technology? I believe that that would give the Secretary of State the power to change whatever he likes. I consider that to be rather unwise and believe that there is not much point in continuing to talk about the Bill if the Secretary of State can change the Act later.
Lord Filkin: I am grateful to the noble Lord, Lord Lucas. for this probing provision because it enables the Government to place a number of matters clearly on the record. It also enables the start of this Committee day to mark some of the fundamental reasons why I believe the majority of this House considers the Bill to be necessary. I shall try to address those questions by illustrating that the clause is necessary and reasonable and that there are safeguards. I shall also pick up the important and specific points that have been raised by Members of the Committee.
The Bill focuses on banning tobacco advertising and promotion. It covers a variety of means of publishing and distributing which we have already discussed. We believe strongly that the clause is necessary as it would enable the amendment of any provision of the Act in consequence of any development in technology relating to publishing or distributing by electronic means.
Throughout our debate on the Bill, the question of the Internet and electronic communication has led us to acknowledge that this is a new, exciting and very rapidly changing area. The Bill does not treat advertising by electronic means either less or more favourably than other forms of advertising. The reason for taking this power is that the pace of technological change makes it very difficult to predict what new means of publishing or distributing may emerge. There are clearly no immediate plans to make an order under the clause.
The noble Lord, Lord Lucas, asked the good, if impossible, question as to what developments might take place in the future that would require the clause to be needed. I believe that if I could answer that. I should probably not be standing here. One would be a rather valuable commodity elsewhere if one could spot what was going to come. One can only do so, to an extent, retrospectively. I recollect four or so years ago trying to communicate by e-mail with the DTR, as it then was. One had to telephone one person who then printed out what one had sent and passed it on. Now, the whole of government communicates electronically. Perhaps two or so years ago we would not have conceived of text-messaging or e-mails to mobile phones. Therefore, without going on at length, I believe it is clear that technology is moving so fast that it is almost certain that new things will occur in the future that we cannot foresee now. Thus, if we did not have such a clause, the Act would rapidly become obsolete.
The noble Lord, Lord Lucas, raised the question of whether the clause includes other technologies. The clause is specific on "electronic", but even if he is right,

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as regards "optical and other means", it is unlikely that there is not some electronic part of such a process that makes it relevant.
I turn to whether or not the clause is unreasonable; in other words, whether it is excessive and goes too far, given the concerns expressed about the power of the Secretary of State to amend primary legislation by order. I draw the attention of the Committee to the report of the former Select Committee on Delegated Powers and Deregulation in February last year in connection with the Government's earlier Bill on the topic. The committee considered that the limited scope of the power and the provision of affirmative procedure made it acceptable. That should give us some comfort. Furthermore, the power is not broad; it is limited. It can be used only in relation to developments in technology. In other words, there has to be a development in technology, which is germane to the Act before it can be brought into use.
Noble Lords will also be aware that if the Secretary of State wished to use such a power, that would require affirmative resolution by this House. The House has become, I believe rightly, more vigorous in the way it scrutinises affirmative instruments at such times.
Noble Lords will also be aware that while it is right to scrutinise such powerful clauses strongly, they are by no means unique. Both this Government and the previous government have used them on a number of occasions. I shall not bore the House by scheduling them unless Members particularly want me to do so.
I turn to the other specific questions, which I have not addressed. The noble Lord, Lord Skelmersdale, raised an extremely important question about the application of the technical standards directive. We do not accept that that applies to the advertising directive. However, we accept that where the specification of products is affected by the technical standards directive, it will apply. We shall follow that with regard to brand-sharing regulations. The question raised by the noble Lord was clearly detailed, thoughtful and technical, and therefore merits, as he requested, a considered and detailed written reply to address the point, which he will receive before Report stage.
I turn to the question raised by the noble Lord, Lord Geddes, on the e-commerce directive, which was adopted on 8th June 2000 and was due to be implemented yesterday. The DTI plans to consult on that in the early part of the year. That consultation process will be thorough and vigorous before the Government table regulations under the directive.
I trust that I have answered the narrow specifics about which noble Lords have expressed concern. With the leave of the House, I shall go back to some of the fundamental reasons why a clause of this type is necessary. It is not simply because of the movement in technology. There are also the severe mischiefs which we in the Committee—and certainly this is the Government's perspective—want to limit.
We have discussed previously the fact that 120,000 people a year will die as a result of smoking cigarettes. There is a slightly different way of putting that, which I do not think has arisen. If we were to put 1,000 20
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year-olds together in a room, all of whom smoke and continue to smoke, from that 1,000 one would be murdered, six would die as a result of car accidents, 250 would die in middle age from smoking and a further 250 would die later in life from smoking. That gives us, graphically, a sense of the scale of the potential damage to young people who take up cigarette smoking. For that reason, the Government arc broadly supportive of the Bill. We need to ensure that future loopholes can be addressed rapidly. That is why we believe that the clause is necessary.
Lord Monson: Before the Minister silts down, does he not agree that Clause 2(3) already prohibits the distribution of tobacco advertisements in electronic form? The subsection is unequivocal, unambiguous and all embracing. Therefore, why is Clause 7 needed?
Lord Filkin: It is necessary for the reasons I have given; that is, to put beyond doubt that there is a power for this place, if it wishes, on a proposition from the Government, to ensure that any subsequent change in technology is not allowed to leave loopholes unplugged and unstopped.
Lord Skelmersdale: For the avoidance of doubt, I agree with the Minister that the world wide web is moving so fast that a clause such as this, on this occasion—I would not tie myself to any other—is necessary. I am grateful to the Minister for responding to my comments on European product law and for stating that he will write to me. However, he made the most remarkable statement in reply to my noble friend Lord Geddes. The Minister spoke about the Government laying instruments under the e-commerce directive. Surely he meant that they will lay an instrument to bring the e-commerce directive into British law?
Lord Filkin: I am sure that that is what I meant to say, even if I did not say it.
Lord Clement-Jones: I welcome the spirit in which the clause has been debated by the noble Lord, Lord Lucas, and other contributors. This is an important issue. A clause of this type is not simply to be treated as inevitable in Bills such as this. If the circumstances were different, I might well find myself on a different issue arguing that such a Henry VIII clause should not be part of the Bill. However, the issues are so important that I believe the clause to be a very important part of the Bill.
In reply to the noble Lord, Lord Lucas, if we knew what to expect in the way of forthcoming technology, we would not need the clause. It is precisely because we do not know what to expect that we do need it. The noble Lord tempts me when he talks about developments in optics, and so forth. Perhaps they are not electronic; perhaps we need a wider clause. I am sure that this would horrify the noble Lord, Lord Lucas, but there may well be arguments that "electronic" is not sufficiently wide to describe the kind of technological communications that will take place in the future.

1253
If we cast our minds back only a few years, when I left the corporate sector in 1995 nobody communicated by e-mail. In the seven years since then, everybody in business has now adopted e-mail. The web is a common factor used by schoolchildren for their school research, and so forth. There have been fantastic changes. We do not know what will happen. We know that technology moves faster and faster. Hence the need for this type of clause.
The noble Lord. Lord Skelmersdale, raised the issue of the technical standards directive. I am sure that he will receive a satisfactory reply from the Minister in due course. I understand that the regulations will need to be notified, as part of the regulation-laying process, if they fall within the directive. However, that does not need to delay, after the passing of the Bill, the way in which the Bill is designed to operate.
As regards the e-commerce directive, the noble Lord. Lord Geddes, received a reply from the Minister on the question of when it was adopted by the Council of Ministers and, indeed, the timetable for when it will be implemented. That means that the actual text of the directive in EU terms is there. Therefore, we have the certainty, about which he was rather doubtful, to build on the Bill and to ensure that it is consistent with the provisions of the directive. I believe that those who might have doubts about the e-commerce aspect would welcome that.
As regards the scope of the clause, the noble Lord, Lord Filkin, rightly referred to the Select Committee on Deregulation and Regulatory Reform. After the Second Reading of a Bill we always await with great anticipation what that committee will say about the particular regulation-making power contained in it. On many occasions it has been highly critical. Quite often the Government change their position at the Committee or Report stages directly as a result of its conclusions. In this case it was clear on the matter. It made no qualification. It said that the power was limited in scope and therefore it is acceptable. The noble Lord, Lord Filkin, pointed that out. So we can be fairly content that this clause goes no further than is necessary.
However, there is a great mischief, as the Minister pointed out. If we allowed a Bill such as this to go through without such a clause, in view of the technological changes that can take place, we do not know whether in a year or two or three those changes will have completely altered the way in which people receive information. To allow advertising over that new medium without this clause would put a large hole in the middle of the Bill. This kind of clause, as we know only too well, is not unprecedented. Indeed, after the passing of the Bill I think that we shall say that this is actually one of the most apposite cases for this kind of Henry VIII clause.
11.30 a.m.
Lord Lucas: I am sorry to say that after all that I find my questions largely unanswered. The Bill sets out at the beginning to catch publishing and distribution in
1254
the widest of terms. Anything which constitutes publishing or distribution and which involves an advertisement will be caught by the Bill. Indeed, because of the way in which Clause 7 is drawn, if it is not publishing or distributing the clause will not bite. So, if it is publishing and distributing the Bill catches it. It does not matter by what means. It could be by thought transference. The Bill would still catch it because someone would be publishing the advertisement and the noble Lord perhaps would be receiving it.
Lord Clement-Jones: "Electronic means", means what it says.
Lord Lucas: Yes, but Clause 1 does not have that caveat. If an advertisement is published or distributed by whatever means imaginable or possible in the future, it is caught by the Bill. Indeed, it has to be published or distributed within the meaning of those words for Clause 7 to catch it. So it does not really matter what advances there are in technology, tobacco advertisements will be caught by the Bill, by whatever means they are published or distributed.
Lord Filkin: If the noble Lord is right, he need have no anxiety about Clause 7 standing part because it will not need to be used.
Lord Lucas: I am saying that in this context there is no need for Clause 7 because there is absolutely nothing that will not be caught by Clause 1.
The Earl of Erroll: The reason for my concern is the matter of precedents. One puts something into a Bill in order to use it as a precedent to put it into other Bills. The noble Lord has already used that argument for keeping it in this one. We should be stopping these precedents being used too often in an otiose way.
Baroness O'Cathain: I should like to clear up a matter with the noble Lord with regard to Clauses I and 7. In another two or three years it could well happen that stuff on the web will not be called advertisements. We do not know. The noble Lord, Lord Clement-Jones, referred to the way in which things have moved so fast in the past two or three years. It is not beyond the wit of people who really want to try and get more and more business to invent a new terminology for the web which does not use the word "advertisement".
Lord Clement-Jones: The noble Baroness makes an interesting point. But that is an argument for widening provisions rather than narrowing them.
The Earl of Erroll: Without even consulting the provision. I seem to remember that it says has the "tendency to promote". It does not actually limit it to the word "advertisement". The beginning of the Bill is drawn in far wider terms. The only purpose that I can give this clause is to set yet another precedent for its use in future legislation.
Baroness O'Cathain: Clause 1 actually states:
"Meaning of 'tobacco advertisement' and 'tobacco product' In this Act——'
'tobacco advertisement' means an advertisement—
(a) whose purpose is to promote".
It means an advertisement. I am saying that it need not he an advertisement, it could be some other nomenclature and something which is part of a marketing ploy of one kind or another.
Lord Filkin: In a sense this touches on a theme which has run throughout the Bill. Perhaps I may go back to some of the general principles. The Bill, if passed, will clearly affect the ability of the tobacco industry to advertise its products. It will not like that, for obvious and understandable commercial reasons. There is massive international evidence that when such bans come in, the industry seeks vigorously to find alternative means, both of promoting its products and of sustaining the brands and, above all, of trying to persuade new users to smoke.
It is for that reason that we must expect and be cautious that there will be further attempts (we know not what) to promote smoking as a habit. The Government's stance is that we are not seeking to prohibit the smoking of cigarettes, but we are seeking to limit the likelihood that people will take up the habit or be able to give it up if they want. That is why it is fundamentally necessary to have careful clauses of this kind, albeit limited in the application of their scope and subject to affirmative resolution of the House.
Obviously, we shall study the thrust of the contention of the noble Lord, Lord Lucas, that this clause is otiose. I think that the word is completely correctly used; we do not need the clause in the Bill. However, I am fairly confident that that will not be the advice when we consider it. No doubt we shall put the matter beyond doubt on Report.
Lord Clement-Jones: Those are wise words. I do not accept the case that Clause 7 is otiose in those circumstances. For example, the clause relates to regulations that may be made in respect of displays. It can relate to all kinds of other things. For instance, if one could make a 3-D display in the future by some electronic optical means in people's homes, would that not be some kind of development that we would want to catch? I do not know whether or not that will ever be possible in the future. I should not be at all surprised.
I am sure that if we sat only for another 10 or 15 minutes we could think of cases where this kind of provision would be entirely appropriate and that it would not be simply overlapping with subsection (3) of Clause 2.
So I do not accept the case for exclusion of Clause 7. I believe that actually it is a very important part of the Bill.
Lord Peston: Does the noble Lord appreciate that the initiation of the debate by the noble Lord, Lord Lucas, leads to the exact opposite conclusion from the direction in which he has directed us? The intervention
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of the noble Baroness, Lady O'Cathain, leads us to that. The point about Clause 7 is that it is too narrow; it is not broad enough. It should have the additional words, "or any means whatsoever".
I do not know whether the noble Lord, Lord Lucas, is aware that the logic of his position is that, far from arguing as he has, he should be arguing exactly the reverse and encouraging the Government on Report to add the words, "or any other means whatsoever", to which I should put up my hand and strongly support. It is not obvious to me that that is what the noble Lord had in mind.
Lord Lucas: I just have not been allowed to get to the end of my speech yet. Yes, as so often, the noble Lord, Lord Peston, is absolutely right. If there were a reason for the clause, I should not add words to the Bill, but just take out the words "by electronic means".
I do not want to prolong the debate. I should be grateful if the Minister could write to me and answer the duality of questions: first, why is Clause 2—and I meant Clause 2 when speaking before—not enough? It seems to catch everything that is publishing or distribution. Secondly, if he can show me why it is not enough, why is Clause 7 not too little? That is the bottom level of what the noble Lord., Lord Peston, asked. I am very happy to have that information by way of a letter.
Lord Filkin: I am extremely grateful. It is a thoughtful probing amendment, and we will be delighted to respond in that way in writing, addressing both points.
Lord Clement-Jones: I welcome that assurance from the Minister. One of the answers to the noble Lord's question is that the clause does not relate only to the process of publishing or distributing. It relates to regulations made under the whole of the Bill.
I am taken by the idea of the noble Lord's controls over thought transference. We may have to consider that on Report.
Lord Geddes: Clause 2(3) has been specifically mentioned more than once in the past five minutes. I hope that I can help the Government on this. I am a bit confused. Subsection (1) of Clause 2 specifically says:
"is guilty of an offence".
Subsection (2) says:
"is guilty of an offence".
Subsection (4) says, "is not an offence". Subsection (3) says nothing. There is no verb in it. Should it not say "is an offence" or "is not an offence"? It should say something.
Lord Filkin: Missing verbs, as the Prime Minister well knows, ought to be an offence.
Lord Lucas: I want to reply to the point raised by the noble Lord, Lord Clement-Jones. The words "publishing" and "distributing" are specifically used

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in Clause 7, so the change must be associated with publishing or distributing for Clause 7 to bite. That is another reason why I think that the clause is too narrow to catch any real mischief.
I wish, I wish that the Government were as the Minister said they were. The first Question that I tabled in the House, when the Government took office in 1997, asked when they would answer my Questions for Written Answer by e-mail. Until today, the answer, with the exception of one or two departments, was, "Not yet".
Secondly, it is all very well to hold up the affirmative resolution as the backstop, as, indeed, it is. The Government propose to do away with our ability to use that absolute backstop and make it a delaying power. We ought to see the matter in that context.
Thirdly, the Minister hymned the necessity of doing as much as we can to prevent tobacco-related deaths. I agree entirely, but I want to pick up an anomaly that has come to my notice recently, which the noble Lord might care to investigate. His colleagues in the Home Office have effectively banned a large segment of smoking-related research in this country. Animals can no longer be exposed to tobacco smoke to investigate the consequences and find ways of curing the results. Such research must now be exported to the Netherlands. Is that in accordance with the wishes of the Department of Health? If not, will the Minister consider doing something about it?
Lord Filkin: As the noble Lord, Lord Lucas, knows, the Government always speak with one voice. I shall certainly look into the issue with interest.
Clause 7 agreed to.
Clause 8 [Displays]:
[Amendments Nos. 53 and 54 not moved.]
Baroness Noakes Baroness Noakes moved Amendment No. 55:
Page 4, line 17, leave out subsection (4).
The noble Baroness said: There is a difference between the offence created by Clause 8 and those that we have discussed earlier in Committee. First, the offence under subsection (1) is dependent upon regulations to be made, and we do not know what those regulations will be. More importantly, the offences created by Clauses 2 and 3 have some specific defences available in Clauses 5 and 6, but no specific defences are available against an offence created by Clause 8. Clause 8 is therefore more draconian than the provisions of the Bill that we have already discussed.
Subsection (4) says that the Government will decide later, and by regulations, whether something is to be outlawed by Clause 2 as a tobacco advertisement or is to be treated as a display. We think that that goes too far and is unnecessary. I am sorry that Amendment No. 7, tabled by my noble friend Lord Skelmersdale, removing for the avoidance of doubt the possibility that a display was not a promotion and, therefore, not an advertisement did not find favour. I also regret that
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Amendment No. 1, to which I spoke on our first day in Committee, which sought to define "advertisement" was also rejected. Even without those clarifying amendments, it should be clear that a display is not an advertisement, and we do not believe that the Government should later choose which set of offences might apply.
I ask the noble Lord, Lord Clement-Jones, to say whether he believes that there is good cause for a provision allowing the Government to pick and choose what is an advertisement or a display at a later stage. If he does, would he say what that is? If the noble Lord believes that there is any potential ambiguity between the terms "advertisement" and "display", the issue would be best dealt with by an amendment removing the ambiguity rather than leaving it to a later decision of the Government.
On our first day in Committee, the noble Lord, Lord Clement-Jones, when speaking against the earlier amendments to which I have just referred, said:
"Our judgement on these Benches is that there is insufficient ambiguity about the word "advertisement" to agree to amendment of the definition".—[Official Report, 16/11/01; col. 806.]
The noble Lord cannot have it both ways. Either the terms used in the Bill are clear and unambiguous—in which case, subsection (4) of Clause 8 is unnecessary—or they are not, in which case, we must amend the definitions used earlier. I beg to move.
11.45 a.m.
Lord Skelmersdale: I hate to be in the position of having to argue with my own Front Bench, but, on this occasion I must certainly argue in part. As I understand the matter, leaving out the whole of subsection (4) would render the whole of Clause 8 useless.
I agree with my noble friend Lady Noakes that what is needed is to decide—or have regulations about—when a display becomes an advertisement. We dealt with that on our first day in Committee and, possibly, on the second day too, when I was not present. If we do that, why do we need paragraph (b)? If we make the decision once, why must we do it the opposite way? That seems totally nonsensical and unnecessary.
The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath): I certainly agree with the noble Baroness, Lady Noakes, that, rather than picking and choosing, in that sense, we require clarity on the matter. I am sure that the noble Lord. Lord Clement-Jones, will argue that Clause 8(4) is intended to provide such clarity. It must be considered alongside Clause 2, as the noble Baroness suggested. That clause gives the power to regulate the advertising of tobacco products at point of sale, whereas Clause 8 gives Ministers the power to regulate the display of tobacco products at point of sale.
In many circumstances, an object will clearly be an advertisement and not a display, such as, perhaps, open and closed signs hanging in a shop door showing

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the brand name of a tobacco product. Other products will clearly be a display and not an advertisement, such as rows of cigarettes in a shop gantry. There may be situations in which something could simultaneously be an advertisement for a tobacco product and a display of tobacco products. An example might be a set of Marlboro cigarette packets arranged in a gantry in the form of the letter M.
It is clear that there must be an understanding among all concerned as to what is a display and what is an advertisement. The Government's intention is to consult on regulations, under Clause 4(2), as soon as possible, if the Bill is enacted. However, the intention would be not to exercise the power under Clause 8. It would be kept as a reserved power that it might be necessary to bring in if there were any loopholes or abuses. The intent is to make the position more easily understandable by anyone involved.
Baroness O'Cathain: I wish to apologise to the Committee for the fact that unfortunately I was unable to take part in the preceding deliberations on the Bill. I am concerned about the way the debate is going. Both advertising and display can be called promotion. It is possible to say that a display might not necessarily be an advertisement, but I always think that a display is in fact part of an advertisement. From long years working in marketing, that is certainly the way it has come to be known.
Should we not add the words "any forms of promotion" to the Bill? I throw this in because I am becoming concerned about the way in which we are moving down one track called "advertising" and another called "display". The two are not really capable of being separated.
Lord Skelmersdale: I believe that, almost certainly, the answer to the point put by my noble friend Lady O'Cathain is to be found in Clause 1. A tobacco advertisement means,
"an advertisement—
(a) whose purpose is to promote".
I suspect that that is exactly what the Minister was going to say.
Baroness O'Cathain: That is also the purpose of a display.
Lord Skelmersdale: I still have not received an answer on the point I raised. It is all very well to produce regulations which define what would turn a display into an advertisement. However, regulations are not then also needed to define what would turn an advertisement into a display. Therefore we do not need both paragraphs (a) and (b) of subsection (4).
Lord Campbell of Alloway: I have to declare an interest in that I am a member of the Lords and Commons Pipe and Cigar Smokers' Club. I never smoke cigarettes; I hate them.
Frankly, this is a most confusing form of drafting which seems to have confused everyone. Surely it is this: if a display is not an advertisement, then broadly
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speaking it cannot be considered to be a promotion; that is, if it is merely a display which is not an advertisement. Either it is or it is not an advertisement as a matter of fact. If it is an advertisement, that is fine. But if it is not an advertisement, well, then what is the matter?
I may have grasped the wrong end of the stick, but having listened to this debate on the matter of construction, I really do think that the clause as it stands is gobbledegook.
Lord Hunt of Kings Heath: No doubt the noble Lord, Lord Clement-Jones, will wish to comment on the drafting of the Bill. Surely the point is that Clause 8(1) applies to the position in relation to displays and defines the offence of which a person would be guilty. Clause 8(4)(a) and (b) seek to enable us to specify under which regulatory regime displays which also could be regarded as advertisements should be treated. That is why we need paragraph (b) as well as paragraph (a); that is, for the avoidance of any doubt.
I accept that the noble Lord may find the wording confusing, but it is a genuine attempt to ensure that there is clarity in this area. Throughout the Bill there have been discussions about the complications of interpretation. That is because of experience of the whole history of tobacco advertisements and the ingenuity of the tobacco companies in this area.
Lord Monson: Perhaps I may take this opportunity to respond to the point put by the noble Baroness, Lady O'Cathain. If the Bill were changed so as to make it illegal to promote tobacco products rather than simply to advertise them, the BBC and ITV would be outlawed from showing on television old films made in the 1930s, 1940s and 1950s. Those films invariably showed the hero and heroine smoking like chimneys, which would undoubtedly have the effect of promoting tobacco smoking among young people.
Lord Clement-Jones: As noble Lords might imagine, I shall not take full credit for the drafting of this Bill. However, I believe that I can help noble Lords in the discussion about it.
The Bill is called the "Tobacco Advertising and Promotion" Bill rather than the "Tobacco Advertising Bill". It covers a wider range of matters than pure advertising. It covers displays, brand stretching, sponsorship and so forth. While I bow to the experience of the noble Baroness, Lady O'Cathain, in the retailing area, I too have some experience in that field, as well as in others. The word "advertising" has a broad meaning when used in the clauses of this Bill and has been designed to do so.
Possibly there are occasions when one could consider a display to be a promotion as opposed to an advertisement. It is entirely possible that a court might take the view that a pile of product in a store is not an advertisement but simply a display of product. The matter is as simple as that.
Lord Campbell of Alloway: I am most grateful to the noble Lord. If the advertisement does not amount to a

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promotion, then no harm will have been done. It is a question of fact and a court would have to decide it. So where is the logic in what he has just said?
Lord Clement-Jones: With the greatest respect, there is huge logic in what I have just said. If a display is effectively a promotion and induces smokers to carry on smoking, to start up again or to smoke more, then that is precisely the mischief that we are trying to stop under the Bill. The Bill makes a distinction between advertising, between sponsorship, between display, between brand stretching and between a number of other areas. That is what it has been designed to do.
However, as the noble Lord, Lord Monson, pointed out, the Bill has not been drafted to say, "Right, every form of promotion is banned". In fact, the Bill is fairer than that. If the noble Lord, Lord Campbell, wishes us to introduce a one-clause Bill banning all possible forms of tobacco promotion, then I am sure we could consider that on a future occasion. I dare say that it would be perfectly acceptable to many noble Lords.
It is possible to pick these things over legally—I have been guilty of that myself on a number of occasions—and come to precisely the wrong conclusion. The Bill takes a common-sense approach.
The noble Baroness, Lady Noakes, introduced the amendment and challenged me on my statement on a previous Committee day. Of course there may well be some form of overlap between an advertisement and a display, and that is precisely what subsection (4) of Clause 8 is designed to cover. It is designed to ensure fairness. Of course those who are faced with the situation where they are had up by environmental or trading standards officers for using a display which could also be an advertisement need to know what would be the penalties for an offence. Thus the subsection has been drafted to ensure the clarity that we all seek in any legislation. We should all be quite clear about what are the penalties and so avoid any confusion in that respect.
However, what we cannot do is legislate in advance for whether in fact something is an advertisement or in fact it is a display. If cigarette packets are stacked into the shape of a large "M", that would be a difficult instance. However, what we need to know is, if such a display could be both, whether the display penalty or the advertisement penalty should be imposed. I do not think that that presents a great conundrum.
Baroness Noakes: I thank the noble Lord, Lord Clement-Jones, and the Minister for their responses. I shall read carefully what has been said. However, I continue to believe that this is an unnecessary provision. If the noble Lord, Lord Clement-Jones, believes that there may be some overlap then the simplest way to deal with it would be to say that anything that is treated as an advertisement should not also be treated as a display. That was proposed in one of the earlier amendments rejected by the noble Lord.
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Certain important additional points have been made by my noble friends Lady O'Cathain and Lord Campbell of Alloway. I shall reflect further on the debate before we reach the Report stage. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Noon
On Question, Whether Clause 8 shall stand part of the Bill?
The Viscount of Oxfuird: In speaking to this clause I declare an interest, as I did at Second Reading, as a member of the Lords and Commons Pipe and Cigar Smokers' Club.
The purpose of my opposition to Clause 8 standing part of the Bill has been made manifest by the debate on the amendments. The matter needs further and slightly more urgent consideration. We have the problem of the word "advertisement", which was discussed when we debated Clause 1 and which subsequently strayed into the purpose of Clause 8 in November. It is useful that we have this opportunity to consider Clause 8 specifically.
The noble Lord, Lord Hunt, explained earlier in Committee that Clause 8 was,
"a preventative clause to give us power in future to produce regulations if there is evidence that the current position, for example on gantries, is being abused in any way".
He went on to state:
"It may be difficult to anticipate what exactly would be in those particular regulations. The safeguard is that they are affirmative regulations".—[Official Report. 16/11/01; col. 818.]
That is quite important and has already been referred to in the debate today. I agree wholeheartedly with the Minister that it is difficult to anticipate what exactly will be in particular regulations, but I am not alone in considering that Clause 8 is confused, will be confusing and, sadly, is not necessary.
We need to look at the history of the clause. It would seem that it was conceived in the course of committee proceedings in the other place in the previous Parliament. In considering Clause 4, the opposition questioned what was a display of tobacco products at the point of sale and whether, possibly, a display could be or could become an advertisement. The outcome was the introduction of an amendment by the government—the addition of Clause 8. That amendment was added to the Bill without any debate as to its content. Far from clarifying matters, as we have heard from the subsequent debates, the issue is confused and confusing.
The Explanatory Notes to subsection (4) of Clause 8 explain that any regulations made under Clause 8 must clarify how displays which amount to advertisements are to be regulated. They go on to state:
"Given that the Government would have regulated both for advertising (under clause 4 subsection (2)) and displays (under clause 8 subsection (1)) at the point of sale, it would be essential to specify under which regulatory regime displays which also amounted to advertisements were to be treated".

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This matter was highlighted by the Select Committee on Delegated Powers and Deregulation. That Select Committee is respected in all corners of the House. In its eleventh report, it described the power given to Ministers by Clause 8 as a "somewhat puzzling power". That is a polite understatement. The Select Committee went on to state:
"The puzzle is made more difficult by subsection (4), which provides that 'The regulations must make provision for a display which also amounts to an advertisement to be treated for the purpose of offences under the [Bill]. as one or other but not both".
Ultimately, the Select Committee considered that the provision of the affirmative procedure was a sufficient safeguard for this "somewhat puzzling power". This clause is not necessary or appropriate.
Lord Skelmersdale: I am reminded that on Second Reading and, indeed, when the Bill in its previous form was being considered by another place, Ministers, both there and here, made the offer to publish as many regulations in draft as they possibly could before the Bill finished its progress in this House. I intervene only to keep both Ministers, as far as possible, up to their promise.
Lord Monson: As Clause 8 appears to be the brainchild of the Government, perhaps this question should be put to the noble Lord, Lord Filkin, rather than to the noble Lord, Lord Clement-Jones. What is the purpose of subsection (2) of Clause 8? The subsection states:
"It is not an offence … for a person who does not carry on business in the United Kingdom to display or cause to be displayed tobacco products—
and so on.
If people are located outside the United Kingdom they are outside the scope of British justice anyway, are they not? Or is it the intention of the Government to alter the proposed European arrest warrant so that people can be extradited from continental EU countries for the heinous crime of advertising tobacco?
Lord Peston: I find myself in the rather embarrassing position of finding Clause 8 totally clear. I am completely at a loss as to what is troubling those noble Lords who are puzzled by it. The logic, it seems to me, is that it is accepted that something may be a display and an advertisement; that that something has to be dealt with, and we have decide whether to deal with it as an advertisement or as a display. Given the way the Bill is drafted, as I understand it, we cannot deal with it as both.
Clause 8 states that as you have got to make up your mind which it is, the best way to do that is to have some regulations, which will be placed before Parliament, to say, "This is how we are going to do it". That makes perfectly good sense to me. I really do not know what noble Lords are fussing about.
I would never be one to criticise the Select Committee on Delegated Powers and Deregulation—although, when we were in opposition, I was against having such a committee because I was totally against that much delegated power going ahead anyway. That
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is another matter, but I am also puzzled that it is puzzled. The matter seems very straightforward. Something can be both a display and an advertisement and you have got to make up your minds how you deal with it.
Although we are not in the psychiatric game today, I should like to know quite what is troubling the noble Lords who are troubled. In my view, the Government should go ahead—I hope that the noble Lord, Lord Clement-Jones, does not resile from this—because this clause is both clear and needed.
Baroness O'Cathain: Perhaps I may ask for clarification from my noble friend Lord Oxfuird. Several times during his introduction, he used the words "point of sale". The words "point of sale' do not enter into Clause 8 at all. It suddenly came to me that someone said that you cannot ban displays because you can go into a confectioners, tobacconists and newsagents and see a whole lot of cigarettes for sale there on display. But a point-of-sale display is quite different. It is something which is at the till or is removed from the cigarettes on the shelves. We need a definition for "point of sale". Generally speaking, in both the retail sector and in marketing generally, "point of sale" means something which is necessarily remote from the normal source of the product—for instance, by the tills, by the check-outs or in a special gondola of its own.
So what does my noble friend Lord Oxfuird mean by "point of sale", particularly as the words do not appear in Clause 8?
The Viscount of Oxfuird: I thank my noble friend Lady O'Cathain for her comments. I am trying to see where I used the words "point of sale". It is not in my script. Oh yes, it is in the Explanatory Notes. I take my noble friend's advice and thank her for it.
The Earl of Erroll: I entirely agree with the noble Lord, Lord Peston, that the provision is necessary. We had a long discussion about what was an advertisement and what was not. We decided not to define it.
I am not trying to allow the advertising of tobacco products to continue. I am concerned about a possible difficulty mentioned to me by the noble Lord, Lord Weatherill, some years ago; namely, the "law of unintended consequences". I am concerned that the Bill could be used by people in order to cause trouble to other businesses, using the very broad powers in the Bill to accuse them of doing something when it might be difficult for them to prove otherwise.
I have referred to this matter previously in relation to material transmitted electronically. Therefore. I shall not bore the Committee with it now. Clause 8 is very useful. It helps to take some matters out that could be included in the term "advertisement". Therefore, I fully support the noble Lord's remarks.
Lord Hunt of Kings Heath: My Lords, we have debated the matter well. I do not think I need repeat

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my remarks in relation to the earlier amendment. I believe that, unlike some noble Lords, my noble friend has got it right. It is abundantly clear why we need to have a safeguard in relation to displays; and why we want, through the regulatory power provided in the clause, to give certainty as far as possible to anyone who might be affected.
It is important to underline the point that it would require an affirmative regulation. Therefore, the matter would be subject to full debate in this House. I know to my own cost that debates on affirmative regulations are extensively scrutinised and cause great excitement to the Department of Health—at least, the previous three or four that I have moved in this House have done so.
Secondly, I want to make it clear that there is no intention of unnecessarily increasing the burdens on small business. I also confirm that the Government do not intend to change the way in which tobacco products are now commonly displayed in gantries in corner shops, supermarkets and ordinary places of sale.
It may well be the case, as I said earlier, that we do not need to make any regulations using the powers contained in the clause. However, because of the potential for future loopholes and abuses—for example, in the case that I cited originally, of a big Marlboro "M" with lots of packets of cigarettes being displayed in it. There is a need for what might almost be called a reserve power to control and regulate the display of tobacco products if that is required.
In answer to the question about Clause 8(2), my advice is that in theory a person not in the UK could be guilty of an offence and could be prosecuted if he or she came to the UK. We would not want that to happen. That is why the clause is drafted in this way.
12.15 p.m.
Lord Clement-Jones: This has been an interesting debate. I suspect that the noble Lord, Lord Peston, and I must have both sprung up this morning with a clear head. I certainly agree with him: I do not find any great lack of clarity in the clause. I understand why we needed to elucidate why subsection (4) was required. But I certainly do not understand why we have to elucidate the whole of the clause.
As has been amply discussed, the clause relates to product displays. We are not talking about "point of sale" material. It is when those displays may possibly be advertisements as well that the provision in Clause 8(4) cuts in.
I am slightly baffled as to why we are having this debate, unless there is a genuine view that the power to ban displays at some point in the future should not be available in the Bill. That is a view with which I strongly disagree. I believe that we may well wish to exercise such a power at some point in the future. Displays are very seductive. If they were not, our supermarkets would not have their "gondolas" full of products. They are product displays which are promotions. Displays in shop windows will be
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particularly seductive for young people. Therefore, I am totally unapologetic about the purpose and design of Clause 8.
Sub-section (4) is intended to provide fairness and certainty, so that it is quite clear into what category of offence a case falls where the promotion is both a "display" and an "advertisement". I do not know whether the phrase "hung for both a sheep and a lamb", instead of "either a sheep or a lamb" has any resonance at all, but that is the design of the clause.
The noble Earl, Lord Erroll, introduced the useful phrase, "the law of unintended consequences", and said that his purpose was to make sure that a situation did not arise where there was a great deal of uncertainty about what kinds of offences people face. Again, that part of the clause is designed to cut back on the number of unintended consequences. I find the clause unimpeached in the course of the debate and I very much hope that Members of the Committee will support it.
Clause 8 agreed to.
Clause 9 [Prohibition of free distributions]:
[Amendments Nos. 56 to 60 not moved.]
Lord Monson Lord Monson moved Amendment No. 61:
Page 5, line 6, after "of insert ""nominal sum" and"
The noble Lord said: In the absence of my noble friend Lord Palmer, I should like to move Amendment No. 61, although I have not had time to study it previously. The amendment is entirely helpful both to the noble Lord, Lord Clement-Jones, and to the Government. It is not in any way a wrecking amendment or one designed to detract from the force of the Bill. It is simply logical—
Lord Hunt of Kings Heath: Perhaps the noble Lord will forgive me. I think there is some confusion as to which amendment he is speaking to. I apologise to the Committee, but perhaps we can clarify that.
The Deputy Chairman of Committees (Lord Brougham and Vaux): Amendment No. 60 is not moved, and I understand that the noble Lord is speaking to Amendment No. 61.
Lord Monson: That is the amendment to which I was speaking. As I said, I believe it is entirely helpful. If the Bill specifies a "substantial discount", it is illogical not to identify precisely what is meant by "nominal sum". I hope that this minor amendment may be accepted without too much fuss by the noble Lord, Lord Clement-Jones.
Lord Filkin: Clause 9(7) provides that any regulations concerning the making of products available for a nominal sum or "at a substantial discount" must define the term "substantial discount". The amendment would require the regulation also to define "nominal sum".
The requirement to define "substantial discount" is in the Bill because it is a relative concept and may mean different things to different people, and in different

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circumstances. For example, many people would see £1,000 as a substantial sum, but if it was the discount off a car costing £50,000 it might not be seen as a substantial discount, being only 2 per cent of the value. Therefore, because of that uncertainty, and because there is the potential liability for a criminal offence, it needs to be beyond doubt what is implied by the term.
We do not believe that the term "nominal sum" is likely to give rise to similar difficulties. This is a term which is generally understood and we think it is right for it to hear its normal meaning. As has been said previously, in the absence of a definition, words in the statute will be given their natural and ordinary meaning. "Nominal" is defined in the dictionary as:
"minimal in relationship to the true value; token; so small or insignificant as to hardly justify the name".
In the absence of a definition, the courts have interpreted the reference to "nominal rent" in the Finance Act 1910 as a mere token or acknowledgement of the relation of landlord and tenant.
In contrast, "substantial" is a word with no fixed meaning that may mean different things to different people. The Government do not support the amendment for that reason.
Lord Clement-Jones: I have very little to add to that. I assure the noble Lord, Lord Monson, that the meaning of "nominal sum" is clear to lawyers. The phrase is frequently used relating to the exchange of documents between trustees, when the beneficial ownership does not change. It is a common phrase that is easily susceptible to interpretation. There are very few circumstances in which there would be any ambiguity about it.
We have had debates throughout the passage of the Bill about whether certain terms used in the Bill should be defined exhaustively. We had a debate about the word "advertisement" at the beginning of Committee stage. There is always a judgment to be made about whether it is better to leave a particular phrase for interpretation or whether there needs to be a particular interpretation for the purposes of a Bill. My strong view is that there is sufficient usage of "nominal sum" across the commercial world for it to be easily interpreted and very clear in its application. Therefore, no particular definition needs to be inserted in the Bill. That is rather different from "substantial discount", which is defined.
Lord Campbell of Alloway: I agree with everything that the noble Lord, Lord Clement-Jones, has said about the amendment. However, whether the essence of what "substantial discount" means should be defined in regulations is a very important point. I agree that sometimes it is better to leave matters open and sometimes it is better to define. However, I do not understand why it is better to define in the regulations under Clause 9(7), but it is not better to define in this muddled affair under Clause 8(4). I am cross-reading against the two. I do not understand why the same provision that requires a definition of "substantial discount" should not be taken on board for consideration before Report when considering the argument on Clause 8(4).
Lord Clement-Jones: I am not sure that I entirely follow the noble Lord in his logic. Clause 8(4) is designed simply to state into which category of offence a display that was also an advertisement—or an advertisement that was also a display—would fall. The regulations envisaged under Clause 8(4) are fairly straightforward. The purpose of Clause 9(7) is rather different. It would give a definition of "substantial discount". The purpose of Clause 8(4) is not to define when an advertisement is a display or when a display is an advertisement. It will be a matter of fact whether an advertisement is an advertisement or a display is a display. The intention is simply to prevent overlap on how offences are dealt with. The two provisions have entirely separate purposes.
Lord Monson: I am grateful to the noble Lords, Lord Filkin and Lord Clement-Jones, for their replies. To a layman, "nominal sum" is almost as imprecise and arbitrary as "substantial discount", but if the noble Lord, Lord Clement-Jones, assures me that it is not in the least imprecise for the legal profession, that is the end of the story. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 9 agreed to.
Clause 10 [Prohibition of sponsorship]:
The Earl of Liverpool The Earl of Liverpool moved Amendment No. 62:
Page 5, line 15, leave out "something" and insert "a public event or activity"
The noble Earl said: Amendments Nos. 62 and 63 have been grouped together, but they address two separate matters. With the leave of the Committee, I shall speak to each amendment in turn.
Unlike the first occasion, when the Bill was introduced by the Government, it is riot accompanied by a ministerial statement that it is compliant with the Human Rights Act 1998. Even if it were accompanied by such a statement, the reality is highly questionable.
In its recent report on the Bill, the Joint Committee on Human Rights draws the attention of each House to a number of important aspects, not least among which is the need for justification of the measures that it contains and an assessment of their proportionality.
Proportionality can be questioned strongly in relation to the impact of the provisions of the Bill, not simply on commercial freedoms but on those of the individual and of private groups. The Bill makes it an offence if a sponsorship agreement has the purpose or effect of promoting a tobacco product in this country. It also prohibits the giving away of tobacco products.
Let us put those provisions into a real-world, practical context. For example, there are private cigar and pipe smoking clubs that often meet for tastings sponsored by specialist tobacconists. The Bill would outlaw the sponsorship of those events. The events could no longer take place, without any benefit to the central objectives of the Bill. I do not regard that as in any way proportionate. I do not believe that it is right that tobacco sponsorship should be prohibited for private groups to which the public generally do riot have access.

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The Minister in another place gave an indication of the extreme scope of the Bill in Committee in the last Parliament. It was then indicated that it would be perfectly acceptable for cigarettes or cigars to be offered to guests at a luncheon hosted or sponsored by, for example, British Aerospace. However, if the same offer were made at a similar event hosted or sponsored by a tobacco company, it would not be acceptable.
It is well known that many companies sponsor lunches and hospitality boxes for sporting events privately. That covers activities such as rugby league matches, test cricket, Wimbledon or Ascot. The Bill would result in the absurd situation in which British Aerospace, an internationally known firm of estate agents and a tobacco company could occupy three adjacent boxes, offering the same hospitality to their clients or guests, yet when they reached the coffee, brandy and cigars stage, while British Aerospace and the estate agents would be allowed to offer all three items, the tobacco company would be able to offer only coffee and brandy, but not cigars. That is patently ridiculous, utterly unreasonable and wrong. I cannot believe that that was the intention of those who drafted the Bill. I hope that the noble Lord, Lord Clement-Jones will look favourably on Amendment No. 62.
One of the purposes of Amendment No. 63 is to introduce consistency to the Bill. The amendment in respect of sponsorship agreements mirrors provisions in Clause 4(1)(a) and Clause 9(3). Clause 4(1)(a) permits a tobacco advertisement,
"if it is, or is contained in, a communication made for the purposes of the tobacco trade and directed solely at persons engaged in any capacity in that trade".
Clause 9(3) permits the giving away of products or coupons,
"for the purposes of the tobacco trade, to persons engaged in any capacity in that trade".
Amendment No. 63 makes a similar provision with regard to sponsorship agreements. It provides that it is not an offence if a sponsorship agreement is for the purposes of the tobacco trade and is likewise confined to persons within that trade. In-company sponsorship agreements are not uncommon in the trade and within trade associations such as the National Association of Cigarette Machine Operators (NACMO). Just as advertising within the tobacco trade and the giving away of product coupons for the purposes of the tobacco trade to persons in the trade should be and is permitted by the Bill, so should it be the case with sponsorship agreements confined to the tobacco trade.
The two amendments are disparate; they are separate. Amendment No. 63 deals with sponsorship agreements within the tobacco trade. Amendment No. 62 deals with events of a private and not public nature. I beg to move.
12.30 p.m.
Lord Campbell of Alloway: I support my noble friend's amendment. In this context, I have to declare that I was a member of the Joint Committee on Human Rights which made the report to which he referred.
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In the context of sponsorship, one has to take on board, first, that there is the total ban on proportionality; and, secondly, that there is this wide definition of tobacco products which goes beyond cigarettes which are the killer on the evidence adduced by many. One has to accept that this interference in lawful trading—the proposed restriction on lawful trading or lawful activity such as sponsorship—has to be justified as proportionate. In this circumstance, the burden of proof in any proceedings would be on those who have to justify. I do not think that it could be done. I give my personal opinion; it has nothing to do with anything that other members of the committee may think or have said. The noble Earl's amendments would move towards a better prospect of justification than otherwise. They should be supported as not interfering with a lawful activity.
The Earl of Erroll: I can understand that we seek to ban the sponsorship of major events and the plastering of names, but I should be sad if the clause included, for example, hospitality tents which are used by invitation only. They are not for the general public to wander into. The amendments are entirely sensible. It would be ridiculous if cigarettes could not be dished up in a hospitality tent which is not open to members of the general public and has a restricted invitation list.
Lord Naseby: I apologise to the Committee for arriving somewhat late. I had to chair the meeting of the governors of Bedford School. I did not think that that should be put off for our third day in Committee. I hope that we shall be able to conclude the Committee proceedings today and that the sponsor of the Bill will be in a more generous mood than previously. These proposed amendments seem an ample opportunity for some generosity by the sponsor of the Bill.
Amendment No. 62 is important. Dare I mention that the Carlton Club had a cigar-smoking evening for those who were interested? Since I do not smoke I did not attend. Whether it was sponsored, I do not know. I doubt it, but I imagine that we may well have negotiated a good price for the evening. It was a private club with a limited section of the membership taking an interest.
My noble friend is right. It is a question of proportionality. First, we are dealing only with a small segment of the smoking market. We are dealing with that segment where the damage in medical terms is still questionable: it does not do damage to the same extent because one does not inhale. I think that the evidence is that cigar and pipe smoking are less damaging. The sponsorship does not involve the public but just those who take an interest in the two products. If it is a private group, involving only those people who take such an interest, there should be exemption.
Baroness O'Cathain: On a point of clarification, the amendment does not specify cigars and pipe smoking which the noble Lord says are less dangerous. It could involve cigarettes.
Lord Naseby: The noble Baroness may have a point in which case the amendment needs refining. The sponsor may wish to make that point. If he does so, the Committee will want to listen attentively.

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Amendment No. 63 deals with the trade and not the public. With regard to the trade, it seems a gross interference in people's normal commercial rights that those who are manufacturing and selling legally are prevented from carrying out a normal promotion of their product to those who distribute it. Airlines and others would not want to have that restriction imposed upon them. It seems wrong that there should be such an imposition on the tobacco trade.
Lord Geddes: I support both amendments in the name of my noble friend Lord Liverpool. The arguments have been well rehearsed. I repeat them briefly.
On Amendment No. 62, I am worried by the use of the word "something". The objective of the amendment is to make it an offence if sponsorship is for a public event but not when it is for a private event. Leaving that aside, what is a contribution towards "something"? In that context, it could mean anything— a railway engine or a camel. The Bill needs to be more specific. My noble friend Lord Liverpool has proposed his amendment in a way that is consistent with the purpose of the Bill.
On Amendment No. 63, perhaps I may endeavour to help the promoter of the Bill and the Government. A Bill which becomes an Act of Parliament must surely be consistent throughout. Since Clause 4(1)(a) and Clause 9(3) are very specific on this point, surely to goodness Amendment No. 63 must be agreed to in order to get some consistency throughout the Bill.
Lord Hunt of Kings Heath: I am grateful to the noble Earl for raising these two matters and I welcome the noble Lord, Lord Naseby, back to our deliberations. He was much missed in our first two hours of debate this morning. I am disappointed that he raised the issue of the Carlton Club because it meant that I could not take a crack at it, as I intended to,
The noble Lord, Lord Geddes, raised the point of "something". I suspect that we shall know "something" when we see it. The essential problem is that by attempting to define, as the noble Earl does, you risk exclusion. The context in which we debate this Bill is one in which we are seeking to exclude potential loopholes. One loophole is that by restricting the ban to a public activity or event, various other forms of promotion may become available. Perhaps a tobacco company could strike a deal with a supermarket which stocks its products to fund a private function. It could, for example. allow a tobacco company to sponsor an event at a social club to which only members are admitted. If that were done in an extensive way, as might be perfectly possible, by the tobacco industry it could be one way to get round the ban and continue to promote such products. The intent of this clause is to put in place a comprehensive ban on the sponsorship of tobacco products, which is why it is drafted as it is.
Regarding Amendment No. 63, I shall be interested to hear what the noble Lord, Lord Clement-Jones, has to say. Certainly one needs to look at whether there are some specific and tight examples where the legitimate
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course of business might be inhibited. That is something we might want to look at without any commitment between now and Report stage.
Lord Clement-Jones: It has been helpful to have both these amendments taken together because they raise issues of proportionality and come back to the public policy issues that we debated earlier in Committee as to how far do you go in legislating for certain things not to take place. Do we start to allow only brandy and cigars to be provided at a corporate event or do we go all the way down the track to allow—let me surmise here—shooting parties or corporate hospitality to be provided by tobacco manufacturers, and then all the way through to semi-public events?
I know where I should like to draw the line——as tightly as possible—because I believe that anything which promotes tobacco products and has the potential effect of increasing tobacco consumption is something which this Bill is trying to attempt. That is why this clause is drafted in the way that it is. But in fact it applies to tobacco products and promotions. It does not apply to the corporate identities of the companies involved.
If a company wishes to sponsor an event, or "something" in the terms of the Bill, my interpretation of this clause is that, provided that the company does not promote tobacco products, it is perfectly entitled to do that. Therefore, if a tobacco manufacturer wishes to have a sponsored event, a trade association event, or whatever it may be, that is perfectly okay provided it does not promote tobacco products.
I do not think, in corporate terms, that this is too restrictive. In fact you might argue that because quite often the corporate name is so closely identified with tobacco products, this is quite a generous clause. Again I do not believe that Amendment No. 62 is necessary. It is a public policy issue. The noble Earl, Lord Erroll, asked why we could not carry on with corporate hospitality. It is a question of degree. In my book, private corporate hospitality events, which are extremely prevalent and are often an extremely effective way of promoting products, are just as culpable of promotion as major public events.
12.45 p.m.
The Earl of Erroll: The point was made earlier about being able to serve cigarettes or cigars at the end of a meal. As I understood the noble Lord's point, if, for example, the company which happened to take the corporate hospitality tent was not a tobacco company it could give cigars and cigarettes out at the end of the meal. If it were a tobacco company, it could not do so. I tend to think that the general public would see that as idiotic and that the law was being an ass yet again. Perhaps one should have some wording to the effect that a tobacco company can behave in a normal fashion in such cases. It is wrong for the law to be seen as an ass. I originally thought that the noble Lord had said that a tobacco company cannot dish up cigarettes

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although other companies can. His later remarks gave me hope that everything might be all right. I am not sure which is the right interpretation.
Lord Clement-Jones: Perhaps I may say, off the cuff, that the noble Earl's initial interpretation is probably correct. There may well be some inconsistency there, but we come back to the principle of the clause, which is whether the effect of the sponsorship is to promote tobacco products. I do not think that the law is an ass if its principle is perfectly clear. There are always one or two unintended consequences, but clearly the aim is to get as few unintended consequences as possible. Certainly they are not got rid of by driving a coach and horses through a clause.
Lord Burnham: Might I ask the noble Lord whether in the context of this amendment and before we get to the Report stage he might consider the possible insertion at some point of the old word "nominal"?
Lord Clement-Jones: I have probably been hoist by my own petard at some stage along the way. I am not quite sure where the "nominal" phrase might fit in the context. Nominal sponsorship, as a phrase, might not fit because sponsorship is very rarely nominal; it is nearly always designed to have an effect on the sales of the product being sponsored.
Baroness O'Cathain: Would this Bill not actually prohibit any hospitality tent for corporate sponsorship by a tobacco company? Therefore, you would not have the problem of three companies with three tents: you would have only the two which were not tobacco companies.
The Earl of Erroll: I am not sure at all. I am only trying to respond to what I have been hearing. I shall be corrected if I am wrong, but a tobacco company could take a tent at some event as long as it was not trying to plaster its name all over it, advertising a tobacco product. The challenge then comes because there is a degree of sponsorship of the event involved. Money has been contributed by the company which helps to support the event. The moment the company serves free cigarettes in the tent at the end of a meal, it has actually supplied a tobacco product, which might be seen to be a promotion whereas, next door, British Gas can quite happily light up and set the world on fire.
Lord Peston: There is a misunderstanding here. This has nothing to do with giving free brandy or cigars at the end of a meal. The Bill has no connection with that whatever and I cannot imagine any rational person thinking that it did. When I was at the annual dinner of the Institute of Directors a few weeks ago people were offered cigars—I immediately refused—and it did not occur to me that the Institute of Directors was promoting tobacco products. Even if the organisation had not been the Institute of Directors, I do not see
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that it was promoting tobacco products. It was doing something for which I certainly not care, but that is not a problem at all.
The only issue is sponsorship, which is another matter. In this case, sponsorship is very clearly and simply ruled out, as it ought to be.
I am a little puzzled by the "private" issue. The Lords and Commons Tobacco Group, or whatever it now calls itself, has not yet declared its interest on this amendment, although it has on earlier ones. I take it for granted, however, that members of that group do not receive free pipe tobacco and free cigars from tobacco companies, so that they have no interest to declare on this matter. I make the point just to be entirely sure that I know where I am.
Lord Monson: It would be extremely helpful if the Minister would confirm that the noble Lord, Lord Peston, is right that it would be quite legal for a tobacco company to dish out free cigars and cigarettes as well as some brandy and coffee at the end of a meal.
Lord Peston: My point is that it is a complete irrelevance whether they dish them out. The question is whether their activity is a sponsorship activity. People at these sponsorship events may find other things more attractive than cigars, such as bags of sweets, which would be just as illegal as anything else at a sponsorship event. In this case the essence is sponsorship; it is not to do specifically with free cigars or cigarettes. That is not what the provision is about, and I am rather keen that we should at least debate what it is about.
Lord Monson: That makes it all the more important that we hear from the Government precisely how they interpret the situation. May I put it to the noble Lord, Lord Clement-Jones, that the recipients of corporate hospitality are very unlikely to be teenagers or even in their 20s or 30s? Those who accept cigarettes or cigars at the end of a meal in a corporate hospitality tent are likely to be confirmed smokers, who are not those whom the Bill seeks to protect. It is an important point.
Lord Hunt of Kings Heath: The noble Lord, Lord Clement-Jones, will undoubtedly wish to respond to those points. Surely, however, the essence of the issue is addressed in Clause 10(1) which deals with purpose. If the sponsorship purpose is to promote a tobacco product then it falls within the terms of the clause.
Lord Clement-Jones: We may well have come across one or two interesting highways and byways in considering Clause 10, but, as the Minister said, the clause's intent is utterly clear. Although I agree with the noble Lord, Lord Peston, that the provision is all about sponsorship, I think that the interpretation of the noble Earl, Lord Liverpool, is probably correct. It may be something that tobacco companies will have to live with. If a tobacco company places cigarettes on the table at an event that it sponsors in its corporate name, that may well constitute promoting a tobacco product.

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It is something that they will probably have to live with. I do riot think that allowing them to do so will serve the purposes of this Bill in any shape or form.
Lord Monson: Would it be in order for them to place on the table a rival company's tobacco products?
Lord Clement-Jones: I have never thought that the tobacco companies were that naïve.
The point on corporate events and younger people will not wash. Younger people are the target audience at some of the events sponsored by tobacco companies, whether they are beach parties, polo matches or many other events of which your Lordships are aware. The age groups concerned do not start at 25.
I am slightly baffled why the noble Earl, Lord Liverpool, felt it necessary to table Amendment No. 63. Provided that it is not promoting tobacco products, sponsorship of trade association activities in the corporate name seems to be a perfectly legitimate activity in terms of Clause 10. If a tobacco company wishes to have a knees-up for its employees, or even for the employees of another company through the trade association, the provision would not, so far as I can see, prohibit it. In promoting Amendments Nos 62 and 63, the noble Earl, Lord Liverpool, has rather made out that Clause 10 is more restrictive than it truly is. If he re-examines the wording, he might find that it is rather more benign than he thinks.
Lord Faulkner of Worcester: Before the noble Lord sits down, would he comment on the point made by the noble Earl, Lord Erroll, about the people at whom the Bill is aimed? He said that the Bill is not aimed at confirmed smokers. My understanding is that it is aimed at the 70 per cent of confirmed smokers who are desperate to give up smoking but do not have the will power to do so and who are irritated by the existence of sponsorship and advertising.
Lord Clement-Jones: Absolutely. We are trying to prevent not only new smokers but relapses by those trying to give up smoking. The noble Lord, Lord Faulkner, is entirely right about that.
Lord Naseby: Amendment No. 63 does not seem as clear as the noble Lord suggests. As I read it, although one can advertise and give away products and coupons within the tobacco trade, a tobacco company cannot sponsor an event that is exclusively for the tobacco trade. If my interpretation is wrong, I very much hope that the Minister will tell me. On my reading of the Bill, it would be impossible for a tobacco company to sponsor an event exclusively for the tobacco trade. Amendment No. 63, however, seeks to make it clear that such sponsorship is possible, just as it is possible to advertise within the tobacco trade.
Lord Skelmersdale: I had not intended to intervene in this discussion, but as it has been shown—we have had discussions on the matter—that advertisements
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circulating within the tobacco trade are legal, it seems a nonsense that corporate entertainment purely for the tobacco trade is not, if that is the case.
Lord Clement-Jones: I do not believe that that is the case. Provided that they are not intended to promote tobacco products, events such as employee knees-up or whatever they may happen to be are entirely legitimate.
Lord Naseby: The noble Lord says "provided that they are not promoting tobacco products", but advertising within the tobacco trade is promoting cigarettes or other tobacco products albeit within the trade. Coupons can be used within the trade. All such activity, which may deal with new developments and so on, is by definition promoting tobacco, albeit just within the trade. The question that my noble friends and I are asking is that if the Bill makes such activity legal—I very much hope that the Minister will confirm that it is; it has certainly been the interpretation all the way through our consideration—why should the tobacco companies not be allowed to sponsor, exclusively to the tobacco trade, a session that is about promoting tobacco? I am not talking about employee knees-up and that type of thing, but a session that is exclusively for the tobacco trade. By definition, such sessions are bound to have some information about the tobacco trade.
Baroness Finlay of Llandaff: I may be naïve about the provisions' legal aspects, but I am concerned about the amendment. The spirit of the Bill is to prevent sponsorship, particularly as it affects young people. Amendment No. 63 might create a loophole whereby any student who has ever sold a packet of cigarettes during their holiday job in Spar could be deemed as one who had been,
"engaged in the tobacco trade (even if they are also engaged in another trade)",
which may be studying, or working in Spar, or Tesco—I do not intend to advertise a specific supermarket.
Students are notoriously short of cash for social events and they would be quite keen to take up an invitation to any event. It seems that Amendment No. 63 would enable a tobacco company to lay on and pay for a social activity such as a ball that could include just about every student in the National Union of Students, almost all of whom have had a holiday job in some of those outlets.
Lord Hunt of Kings Heath: The noble Baroness has put her finger on one of the problems. By accepting Amendment No. 63, your Lordships could be giving tobacco companies the green light to organise and sponsor events or social contacts in the industry which may well be associated with other sectors. If that happened, the point that the noble Baroness has raised would come into play.
Earlier I put it to the noble Lord, Lord Clement-Jones—if we accept that there is a problem in terms of loopholes—whether there are instances of legitimate business activity which have been mentioned which

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one would not wish to see caught by the provision. I do not know whether the noble Lord, Lord Clement-Jones, without commitment is prepared to consider that narrow area between now and Report.
1 p.m.
Lord Clement-Jones: This is an interesting point. I am not convinced by the logic of the noble Lord, Lord Naseby. There is much more potential for leakage into the wider world during a sponsored event. I refer, for example, to an annual Benson & Hedges ball which is given strictly to promote Benson & Hedges products. Of course, that falls within the terms of the noble Earl's amendment. However, people invited to that ball may invite all their friends.
Lord Naseby: Perhaps the noble Lord has not fully understood the matter. If everyone who attends that event is in the tobacco trade, the situation would be covered by the amendment. However, if anyone attended who was not in the tobacco trade, that would not be the case.
Lord Clement-Jones: So no wives, daughters or sons would be invited, only those involved in the tobacco trade?
Lord Naseby: That is how the amendment is drafted at present. The Minister made a helpful suggestion. One can go from the extreme of saying that the provision applies purely to people who must currently be involved in the tobacco trade—that is perhaps the tightest definition—or apply various gradations within that definition. All I ask the noble Lord to consider is how the tobacco industry can continue its normal functioning and yet not open such events to the wider general public. The noble Baroness mentioned students. Neither I nor my noble friends wish to open up that area. As I say, the Minister made a helpful suggestion. I hope that the noble Lord will consider it before Report.
Lord Clement-Jones: Those comments are helpful. What the noble Lord, Lord Naseby, is really saying is that the measure will not be used as a Trojan horse. It is concerned entirely with the trade. Any amendment will need to be judged entirely on that basis. Clearly, there are still drafting points to consider, but I am prepared to consider the amendment before Report.
The Earl of Liverpool: I assure the noble Lord, Lord Clement-Jones, that I had no intention of introducing a Trojan horse. The amendment is a genuine attempt to try to tighten an inconsistency in the Bill and, most importantly, to allow companies going about their legal business at such events to be treated in the same way as other companies not in the tobacco trade. My Amendment No. 62 may be imperfect. However, it was not intended to constitute a way of getting round sponsorship. I am not trying to do anything other than explain that there are a number of companies in different fields which offer corporate hospitality at
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sporting events around the country. They may have a marquee or simply a small box. However, those marquees or boxes will not be open to the public and admission will be by invitation only.
I am not referring to the situation where a tobacco company sponsors the event to which it invites its guests. It seems to me that it is completely absurd for the company offering corporate hospitality not to be allowed to hand around cigarettes and cigars because it happens to be a tobacco company. Apparently, that is the position as that is the way the sponsor of the Bill interprets it. However, companies not involved in the tobacco trade would be able to hand out those products freely.
Lord Hunt of Kings Heath: I am grateful to the noble Earl for giving way. Surely, there is a big difference here; namely, that the company not involved in the tobacco business is not involved in promoting tobacco products, whereas a tobacco company is so involved. There is a logic as regards why they should be dealt with differently.
The Earl of Liverpool: I thank the Minister for that intervention, but can he not see that that is not the prime point of offering the corporate hospitality? The point of offering that hospitality is to thank friends and people involved in the trade for their custom over the years, as other companies would do. In those circumstances it would be abnormal not to offer the whole round of hospitality which involves food. drink, cigarettes and cigars. Surely it cannot be the intention of the Bill to make that illegal. Is the Minister saying to me that these events could be policed and someone could he hovering waiting for the whiff of smoke to emanate from a tobacco company's private box? I believe that that is what he is saying and it is completely absurd.
Lord Hunt of Kings Heath: I am sure that we can rely on the good sense of the enforcement authorities. In the previous Committee debate we debated the protocol under which trading standards officers would enforce the provisions of the Bill. I am sure that they would do so sensibly. My view is that the noble Earl should perhaps quit while he is ahead as I sense that the noble Lord, Lord Clement-Jones, is sympathetic to the point about a potential problem in terms of legitimate business activity. It may be wise to call a halt to the matter at this point and allow discussions to take place between now and Report.
The Earl of Liverpool: I thank the Minister for those helpful remarks. In conclusion, I thank all those who have taken part in this interesting debate. As I say, I am grateful for the Minister's comments. On the basis that the matter will be considered before Report. I am happy to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 63 to 65 not moved.]
Clause 10 agreed to.
Clause 11[Brandsharing]:
[Amendments Nos. 66 to 68 not moved.]
Lord Naseby Lord Naseby moved Amendment No. 69:
Page 5, line 44, leave out ", or whose effect is to do so"
The noble Lord said: In the absence of my noble friend Lord Lucas, I move the amendment. The amendment recognises that we all understand and are at one with the words in the Bill which state,
"may prohibit or restrict only that use whose purpose is to promote a tobacco product".
However, the amendment seeks to remove the rather odious following words in the Bill; namely,
"or whose effect is to do so",
as they constitute a judgmental provision as to whether or not that effect will occur. It seems to me that that constitutes a wonderful opportunity for lawyers to spend endless hours in the courts trying to decide whether or not that effect will occur. In moving the amendment I seek to tighten the Bill so that we are absolutely clear that it is the promotion of tobacco products that we must avoid. However, if the element that is being promoted is a "tick", for example—I do not think that Nike has anything to do with the tobacco trade—that should not be banned. I do not want to become involved in a long debate about brands that cover various products as we dealt with that previously, although not very satisfactorily. As I say, the amendment seeks to tighten the Bill and not give lawyers a wonderful opportunity to make considerable sums of money. I beg to move.
Lord Filkin: I thank the noble Lord, Lord Naseby, for moving the amendment—although I doubt that the noble Lord, Lord Lucas, if he had been in his place, would have done so. Given his strong interest in these issues, I trust that he would have let it pass. Given that, I shall be extremely brief, but I shall be prolix later if necessary.
Effect is there as well as intention, for reasons upon which we have touched previously. We are not seeking to inquire into people's souls, as to whether or not they want to have a certain effect. We are trying to limit the effect of tobacco promotion on young people and those who wish to give up smoking. Whether or not the action was intended, if the effect is of the nature in question the Government's position is that we want the power to limit that effect. The Government will consult carefully and thoroughly on regulations, so that we hear the views of the industry and others.
Lord Clement-Jones: This has been one of our shorter debates but the wording
"whose effect is to do so"
is extremely important. The definition of a tobacco advertisement in Clause 1 is one
"whose purpose is to promote a tobacco product, or … whose effect is to do so".
That is entirely mirrored in Clause 11 and rightly so, because it is crucial that brand-sharing is caught in the same way. If the measure were based purely on intent,
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anybody who recklessly or negligently used a brand that had the effect of promoting tobacco would not be caught. If the regulations—which the Minister has said will be heavily consulted on—were based purely on intent, it would be far too easy for someone to escape.
We return to public policy and how high the hurdle should be. It is entirely appropriate that the test should be, as well, whether the effect of the use is to promote tobacco. Companies should be put on notice that they need to be careful to ensure that their activities do not promote tobacco products.
Lord Naseby: Having listened to the Minister and the promoter, we clearly disagree. But we have debated the issue at length on two previous occasions and as I, too, want to make progress, I do not choose to divide the Committee. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 11 shall stand part of the Bill?
1.15 p.m.
Lord Naseby: I remain deeply concerned about brand-sharing, which the promoter said he is determined to outlaw. In our earlier deliberations on own-label products, the noble Lord cited Sainsbury's and seemed to suggest that a tobacco own-brand would be permissible and not fall foul of Clause 11. That is an important point and one on which I have not given the noble Lord notice—so if he does not wish to respond now, it needs to be answered on Report.
How confident are the Government that they will not find themselves facing claims for compensation for loss of intellectual property rights? I imagine that some work must have been done on that aspect. On 7th December, the Minister said that was a complex subject—which means, "Heavens! This looks like dangerous ground and I am advised that I should be getting worried." I hope that those two points will be clarified on Report because they are crucial to the Bill and important to the industry.
Lord Peston: The noble Lord, Lord Naseby, is right to remind us that we will return to one or two of these topics on Report. Brand-sharing is an area in which I made a mistake. I did not know that Dunhill had sold the rights to use its name on cigarettes rather than being involved in cigarette manufacture itself. That is the past and there is no problem from now on, so I agree that point relates to Amendment No. 7. However, Dunhill was an innocent party and we must ensure that such companies are not damaged in respect of brand-sharing. I totally support the noble Lord's view that one or two technical aspects require further scrutiny, without any commitment as to where any of us will end up.
Lord Filkin: I am seriously worried if the noble Lords, Lord Peston and Naseby, agree—we are clearly in some difficulty. Both noble Lords are right on this occasion. The general principle is that the Government

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are confident that there will not be a legitimate case for compensation, having consulted on the regulations after the Bill is passed with the care that we intend. The defence of public health is the fundamental issue but we take the noble Lords' point and request. We will look at the issues in some detail and give answers on Report, if required.
Lord Clement-Jones: It has taken two and a half days in Committee to bring the noble Lords, Lord Peston and Lord Naseby, together. As the Minister said, some issues need deliberating upon when the regulations are put together.
I am not sure that I gave any undertaking about the use of Sainsbury's in brand-stretching but I am sure that any regulations would be wrong if they did not permit Sainsbury's to use its name even if the company had an own-brand cigarette. It is not that use of the Sainsbury name would be promoting cigarettes. That would not be a fair interpretation if the name were on a sweatshirt, tracksuit or umbrella—which is a different proposition. We can all think of other examples, so work needs to be done when composing the regulations.
We need to think about some of the consequences of particular forms of regulation. If the Bill did not have a brand-sharing clause, that would weaken it considerably because brand-sharing is the route of modern marketing. The noble Baroness, Lady Jay, was particularly eloquent on the subject of examples from abroad, which demonstrated how brand-sharing is used in the modern world and directed at young people. Clause 11 is an essential part of the Bill but we need to treat the regulations with some care.
Clause 11 agreed to.
Clauses 12 and 13 agreed to.
Clause 14 [Powers of entry, etc]:
Lord Monson Lord Monson moved Amendment No. 71:
Page 7. line 18, leave out "which he considers" and insert "where there are reasonable grounds for him to believe"
The noble Lord said: In the absence of my noble friend Lord Palmer I shall briefly speak to this amendment and those grouped with it. Once again, the amendments are all extremely moderate. They are certainly not intended to weaken—still less to sabotage—the Bill. They would introduce a concept of reasonableness into the powers of entry that are conferred in Clause 14. Noble Lords are traditionally vigilant in defence of our liberties and accordingly suspicious of granting powers of entry unless they will be used reasonably and can be shown to have a reasonable basis. The amendments are self-explanatory. I beg to move.
Lord Skelmersdale: When I read the amendment I had to check up on my rather faulty memory. The words in the Bill differ from those in the Consumer Protection Act 1987. I ask either the noble Lord, Lord
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Clement-Jones, or the Minister: why? The situation is—or should be—almost exactly the same under this Bill and that Act.
The Earl of Erroll: I am afraid that I do not always share the belief that the noble Lord, Lord Hunt, has in the reasonableness of enforcement agencies. Occasionally, one comes across someone who might be described as a little dictator and it is very wise sometimes to involve a third party. The next group of amendments, which I hope will be spoken to by the noble Baroness, Lady Jay, raise exactly the same matter. I shall save myself from having to leap up in that debate if I say now that those amendments appear to be extremely sensible for exactly the same reason.
Lord Naseby: In supporting the noble Lord, Lord Monson, we need to remind ourselves that the offences with which we are concerned involve the publication and distribution of advertisements, free products, coupons to the public or sponsorship agreements that promote a tobacco product. The key difference between these offences, which are clear, and many of the other offences—in relation to which trading standards officers will need the powers contained in the Bill—is that these are open offences; they are already in the public domain. That is perhaps unlike the situation involving the Consumer Protection Act, which was mentioned by my noble friend Lord Skelmersdale; that may need detailed investigation. We should also consider the Food Standards Act in that regard—again, it may not be immediately obvious that there is a problem or that urgent action by trading standards officers is required.
The fact that these offences are already in the public domain means that the amendments, which would trim back a little the powers of entry, are more appropriate than having the draconian provisions that are understandably necessary in relation to, in particular, the Food Standards Act. This is a matter of proportionality—we again return to that word. I support the noble Lord, Lord Monson, who moved the amendment.
Baroness Noakes: I shall speak briefly to Amendments Nos. 77 and 81, which stand in my name. The noble Lord. Lord Monson, who moved Amendment No. 71, and other noble Lords who have spoken subsequently, referred to these as modest amendments that are designed to trim very slightly the Bill's scope.
Amendment No. 77 is narrow and deals with the power to retain documents. It is similar to Amendment No. 76, which stands in the name of the noble Lord, Lord Palmer. Amendment No. 77 would slightly amend the power that officers will have to hold on to documents for weeks or months on the grounds that they consider it necessary—whether or not it is reasonable—for those officers to hold on to items for a long period. None of the other powers in subsection (1) carries the same potential for the disruption of a business. A power of entry may well be disruptive but it is over in a relatively short period. If an officer goes

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in and takes away books and records a business could be seriously inconvenienced. If the officer takes away products, the financial consequences could be significant to the business. That is why a test of reasonableness is proposed in the clause.
I turn to Amendment No. 81, which is another modest amendment. It deals specifically with the right of entry into premises either in relation to subsection (1) or under a warrant granted under subsection (4). Under subsection (5) an officer can take with him any,
"other persons … as he considers necessary".
Amendment No. 81 would require both persons to be authorised. The officer would not have the discretion to take with him or her whomever he or she chose; responsibility would be placed firmly on the relevant weights and measures authority, which must authorise specific individuals. The amendment would ensure that that authority took full responsibility for the relevant individuals when private premises were being invaded—possibly when the occupier was not present to supervise entry. That is a small safeguard to businesses. I hope that it will commend itself—not much today has commended itself—to the noble Lord, Lord Clement-Jones.
Lord Filkin: We come to the extremely important issue of enforcement, which the Committee naturally wants to ensure will be handled well and appropriately in the Bill.
Amendments Nos. 71, 72, 76, 77, 79, 80 and 82 seek to place in the Bill an express requirement on enforcement officers to act reasonably. I recognise that Members of the Committee are concerned to ensure that enforcement is carried out responsibly and that trading standards officers do not play fast and loose with the law. However, there is no need for the amendments. The duty to act reasonably applies in any event. Enforcement officers can already be held to account for the exercise of their duties. Indeed, any trading standards officer who "misconducts" himself or herself in the execution of his or her office is guilty of an offence and liable on summary conviction to a fine of up to £5,000 under the Weights and Measures Act 1985. Apart from anything else, no prosecution could succeed if enforcement officers were seen to have acted unreasonably. The Government therefore believe that, although we are sympathetic to the anxiety that caused the amendment to be moved, it is simply unnecessary to pad out the Bill with references of that kind because we believe that the issues are already dealt with under existing statutory powers.
Despite the point that was made by, I think, the noble Earl, Lord Erroll, we are generally confident and trust in the good sense of local authorities corporately and in officers individually to ensure that implementation of the Bill is sensitive and appropriate.
I turn to trading standards officers and the way in which they tend to act on such matters—they are the officers responsible within the relevant local authorities for enforcement. The approach of trading standards officers is to draw attention to offences and then to educate, to prevent or end offences in the
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simplest and swiftest way. Prosecution is not usually their first action. Court proceedings tend to he their last resort. We do not expect the Bill to result in large numbers of prosecutions. Tobacco companies have told us that they intend to comply with the law. Trading standards officers attempt to resolve an issue, to educate and to draw attention to offences before there is a need to prosecute.
Trading standards officers also operate under the principles of good enforcement, which were outlined in the joint sponsored Local Authority Association/Cabinet Office enforcement concordat, which was published in 1998. It is available from the Better Regulation Unit at the Cabinet Office. That seeks to ensure that enforcement authorities publish performance standards, are open and helpful, provide a means to complain, follow up on complaints received, ensure that wherever possible the impact of legislation is proportionate and act in a consistent manner.
Again, in addressing what the noble Lord, Lord Naseby, said, my own experience has led me to believe that in general trading standards officers do act responsibly in this way. I believe that that is reinforced by the presence of LACOTS—the expert local authority body—which will try to ensure that enforcement is dealt with skilfully, informedly and, so far as is reasonably practicable, uniformly. Therefore, this is probably one area where local authorities are best supported by a specialist body that has been formed for these purposes.
With regard to the question raised by the noble Lord, Lord Skelmersdale, in relation to the Consumer Protection Act, we should like to look at that in a little more detail. The glib answer might be that that Act dealt with the compensation of substantial goods. But let us return to that issue at a later stage.
I turn to the concern expressed by the noble Baroness, Lady Noakes, about the power to hold on to goods. Again, I believe that a distinction arises with the Consumer Protection Act when sometimes substantial goods can be confiscated in the course of an investigation or a potential prosecution. Under this Bill, if passed, in almost all cases trading standards officers would be likely to seize on entry and investigation documents or a computer hard disk. They would not seize, for example. a substantial amount of cigarettes. We would generally expect the power to seize goods to be minimal.
For those reasons, I suggest that, while the intent of the amendments is understandable, it is not necessary for them to be put on to the face of the Bill.
1.30 p.m.
Baroness Noakes: Before the noble Lord sits down, perhaps I may ask him to look specifically at Amendment No. 81. It does not concern an issue of reasonableness, to which I believe he directed his remarks relating to the way in which trading standards

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officers work. It concerns whether or not the persons who enter into premises under the powers in the Bill need to be authorised by the appropriate authority.
Lord Filkin: I thank the noble Baroness for drawing my attention to my omission on that point. Unfortunately, however, I also ask the Committee to reject Amendment No. 81. Clause 14(5) allows a duly authorised officer entering premises on the authority of a search warrant in connection with the enforcement of the Bill to be accompanied, as the noble Baroness rightly points out, by such persons as he considers necessary. That could mean a trading enforcement officer or, in the rare cases where violence was feared, a police officer.
This subsection follows other similar legislation, such as Section 33 of the Consumer Protection Act 1987 and Section 32(4) of the Food Safety Act 1990. I do not believe that in practice the absence of the word "authorised" in this legislation has caused problems. Therefore, I do not agree with the implication that enforcement officers, who are professional public servants, may be inclined to take inappropriate people along with them in the course of their duties. For that reason, I do not believe that we need to be concerned in the way that has been suggested.
Lord Clement-Jones: I do not propose to add a great deal to the Minister's very full reply on this subject. The Bill stands on its own. In the enforcement section, it deliberately tries to take a balanced view as to what powers are necessary and how they should be exercised. In one case, it is clear that it is on all fours with the Consumer Protection Act; in another case, it is not necessarily on all fours with that Act. No Bill will necessarily follow slavishly a previous Act; it depends on the circumstances. The Minister said that he will look a little closer at the comparison with the CPA of the reasonableness insertion. I have no doubt that that would also apply if there were other comparison points in the enforcement powers. I believe that that is a fair offer.
In the meantime, I do not believe that we can but be reassured by what the Minister had to say in his very full reply about the way in which enforcement officers exercise such powers. They are already under a duty to act reasonably and they have a very strong professional body which ensures that they act professionally and exchange information in a professional fashion. Therefore, I believe that, without evidence to the contrary, the provisions in this clause are currently fairly adequate. No doubt the Minister will return to us if he believes that there is a comparison with the Consumer Protection Act which should perhaps be closer in terms of making "reasonableness" explicit.
Lord Monson: I am grateful for the support that has been given to these amendments, albeit slightly qualified in the case of the noble Baroness, Lady Noakes. In the light of the intervention of the noble Lord, Lord Skelmersdale, from which I inferred that
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the requirement of reasonableness has, indeed, been enshrined in the Consumer Protection Act, I am slightly saddened by the reply given by the noble Lord, Lord Filkin. If enforcement officials are de facto obliged to behave reasonably, why not dot the "i"s and cross the "t"s by stating that on the face of the Bill?
Lord Filkin: For two reasons. First, generally we have confidence in the wisdom and care with which trading standards officers operate; and, secondly, because it is otiose to do so.
Lord Monson: That may be. I take on board the fact that the Government will look at the Consumer Protection Act between now and the next stage. Certainly, as the noble Lord, Lord Clement-Jones, has just said, it is extremely helpful to have the comments of the noble Lord, Lord Filkin, on record. That may be helpful during the proceedings at a future date. I have no idea whether or not between now and the next stage the Government will try to bring matters into line with the Consumer Protection Act, and I have no idea what my noble friend Lord Palmer will wish to do on Report. However, for the time being, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 72 not moved.]
Baroness Jay of Paddington Baroness Jay of Paddington moved Amendment No. 73:
Page 7, line 23, at beginning insert "where he considers it necessary for that purpose,".
The noble Baroness said: This group of amendments, to which my name is attached, takes forward the discussion that we had on the previous group about more effective enforcement of the provisions in the Bill. I hope that they will perhaps find more favour with the noble Lord, Lord Clement-Jones, and with the Government. They are very straightforward and are designed simply to assist the trading standards officers who may make an investigation.
Specifically, the power in Clause 14(1)(c) to take possession of books, documents, and so on, can, as the Bill is drafted at present, be exercised only where the item has been produced in accordance with the requirement mentioned at the beginning of the paragraph. Clearly that will not matter in circumstances where an officer has perhaps been invited, or at least allowed, on to the premises without a search warrant. Presumably in those circumstances the occupier is at least collaborating with the investigation, if not necessarily welcoming it.
However, we believe that there may be a potential problem with an officer who is on the premises by virtue of a search warrant or who could, indeed, be on premises which were not at that moment occupied and who may need power to investigate articles or perhaps, as was suggested in the discussion on the previous group of amendments, seize articles in the last resort without having first required their production, as the Bill currently states. If, for example, the premises were

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unoccupied, it would be difficult for those products to be voluntarily produced so that the officer could take possession of them.
As I said, these amendments are extremely straightforward. My noble friend Lord Faulkner and I tabled these amendments. We hope usefully to close a potential loophole. I am grateful to the noble Earl, Lord Erroll, for the support that he gave before I even spoke to these amendments. I hope that they will be welcomed equally by the noble Lord, Lord Clement-Jones, and, indeed, by the Government.
Lord Filkin: I am very grateful to my noble friends Lady Jay and Lord Faulkner for these amendments, which seem to us to be helpful and necessary. Therefore, the Government support them. In short, for the reasons given by my noble friend and without repeating what she said, we consider them to be necessary in exactly the circumstances that she instanced. Therefore, we very much wish to support them and to see them incorporated into the Bill.
The Earl of Erroll: The reason I like the amendment is that it separates the production from the retention. I have not read far enough forward, but I wonder whether Amendment No. 78, which I have not read properly, should contain provision for appeal. If one's documents have been removed, it may be difficult to continue one's business. Perhaps that could be looked at more closely. Otherwise, in general, I believe that separating the retention from the production provision is a good idea. I did not mean to be heavy-handed a bout trading standards officers, for whom I have great respect and about whom I have heard only good. I referred in a more general sense to enforcement. One occasionally hears stories about other agencies and one never knows. Perhaps I am being over-cautious. I would hate it to be thought that I have ever heard anything had about trading standards officers.
Lord Naseby: I do not rise to support the amendment but I shall not speak against it either. I rise simply to point out to the Committee that if the amendment were to find favour, it would strengthen the case for an appeal mechanism.
Lord Clement-Jones: I am not sure that I follow the logic of that. I shall ponder it when I read Hansard on Monday. The amendment clearly closes a valuable loophole. I am delighted that the noble Earl, Lord Erroll, took the opportunity to ensure that the trading standards officers would not take offence at anything he said in the course of the debate. I do not know whether he has interests in ensuring that he keeps good relations with them, but perhaps I may say that that was a neat piece of backtracking. Obviously, in so far as the amendment closes a loophole, I welcome it.
On Question, amendment agreed to.
Baroness Jay of Paddington Baroness Jay of Paddington moved Amendment No. 74:
Page 7, line 24. after second "it," insert "and"
On Question, amendment agreed to.
The Deputy Chairman of Committees (Viscount Simon): Before calling Amendment No. 75, I must inform the Committee that if that amendment is agreed to, I cannot call Amendments Nos. 76 and 77 standing in the names of the noble Lord, Lord Paltrier, the noble Earl, Lord Howe, and the noble Baroness, Lady Noakes.
Baroness Jay of Paddington Baroness Jay of Paddington moved Amendment No. 75:
Page 7, line 25, leave out from first "it" to end of line 26.
On Question, amendment agreed to.
Baroness Jay of Paddington Baroness Jay of Paddington moved Amendment No. 78:
Page 7, line 26, at end insert—
"(ca) to take possession of any book, document, data, record (in whatever form it is held) or product which is on the premises and retain it for as long as he considers necessary for that purpose:
On Question, amendment agreed to.
[Amendments Nos. 79 to 82 not moved.]
Baroness Jay of Paddington Baroness Jay of Paddington moved Amendment No. 83:
Page 8, line 16, leave out "(1)(c)" and insert "(l)(ca)"
On Question, amendment agreed to.
1.45 p.m.
Baroness Noakes Baroness Noakes moved Amendment No. 84:
Page 8, line 43, at end insert—
"(13) If a person who enters any premises by virtue of this section discloses to any person information obtained on the premises with regard to any trade secret, he is, unless the disclosure is made in the performance of his duty, guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale."
The noble Baroness said: In moving Amendment No. 84 I shall speak also to Amendments Nos. 85 and 86. This group of amendments has a theme of providing protection to those against whom the powers of entry, and in particular access to and retention of goods, are used. The amendments do not seek to deny the powers, but seek to provide some counterbalances where things go wrong.
I stress that these are not unusual protections but ordinary measures similar to those found in other legislation. They are designed to deal with what one hopes will be the rare event of the Clause 14 powers being used inappropriately. The powers are particularly important, given that the earlier amendments, relating in particular to reasonableness, seemed not to catch the eye of the noble Lord, Lord Clement-Jones.
Amendment No. 84 inserts a new subsection (13) to Clause 14. It is designed to ensure that those who enter premises using the Clause 14 powers do not abuse any information about trade secrets that they acquire. Subsection (13) makes it an offence to disclose that information otherwise than in the performance of the officer's duty. I have mentioned that 1 do not expect the subsection to be needed often, but it is a useful

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reminder to those using the extensive powers created by the Bill that they carry responsibilities to those being investigated or pursued.
I turn to Amendment No. 85, which seeks to introduce a new clause after Clause 15 to deal with the situation where goods have been retained by an authorised officer under the Clause 14 powers. As the Bill stands, without amendment, the officer can take possession of and retain books, documents and, importantly, products and can then keep them for as long as he considers necessary for the exercise of his functions under the Bill.
So, what happens if the officer arrives, enters premises, takes away goods but then does nothing? There is no specific remedy for that in the Bill. The amendment creates in subsection (1) the power for the owner of goods, or someone else with an interest in the goods, to apply for an order for their return. Under subsection (2) the application has to be to a magistrates' court or, in Scotland, to a sheriff. Committee Members will see that what is intended is a low-level and accessible court.
Subsection (3) restricts the remedy to cases where proceedings have not been brought and more than six months have elapsed since the goods were seized. That is a remedy which is modestly framed and does not result in every seizure being followed immediately by legal challenge. Finally, subsection (4) contains rights of appeal from the magistrates' or sheriff's decision.
I lay particular emphasis on the modesty of the provision. If a business has had its documents or records seized, that could disrupt the operational efficiency of the business. If saleable products have been taken—the noble Lord, Lord Filkin, said earlier that that is not likely but it is possible under the Act—the financial consequences could be significant. The first priority for people is normally to get the goods hack. I hope that the noble Lord, Lord Clement-Jones, and the Minister can see the force of that. I hope that they will not take the view that anybody even suspected of a breach of the tobacco advertising ban being introduced by the Bill should become a person without rights to his own goods for as long as the authorities decide. I know that many noble Lords on other Benches have scant sympathy for tobacco companies in particular and, indeed, big businesses generally. However, I remind noble Lords that the Bill is widely drawn. It can drag many smaller businesses within its net: those in printing; newspaper distribution, advertising; and specialist tobacconists, to name the more obvious.
Amendment No. 86, the last in this group of three amendments, deals with a more significant remedy for those who have been subjected to the powers of seizure and detention under Clause 14 but are innocent of the crimes created in the Bill. The new clause after Clause 15 would enable the owner of or other person with an interest in the seized goods to claim compensation from the enforcement authority.
Subsection (1)(b) would not allow compensation to be paid if the power to retain the goods had been exercised due to the owner's default or neglect. So,
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perhaps if the owner had in some way obstructed the officer's inquiries leading to the officer retaining the goods, the owner would not be entitled to a remedy under the new clause. The aim of the clause is to insert a low-cost remedy which is not over-burdened with costly legal action. Hence the suggestion of arbitration in subsection (2).
As with the two previous amendments, I hope that the noble Lord, Lord Clement-Jones, and the Minister can see the equity involved in the amendments and will he prepared to accept the principle of the amendments of modest remedies and protections for those potentially unfairly affected by the Bill. I beg to move.
Lord Skelmersdale: If any part of the Bill is objected to in the courts by virtue of an appeal on the subject of human rights, I believe that it will be this part. My noble friend Lady Noakes is right. Without provisions for compensation and appeal in Amendments Nos. 85 and 86, Clause 14, as currently drafted, amounts to a rather unreasonable and unjust measure. I cannot find any justification for it at all, especially in view of the general range and seriousness of offences under the Bill.
So far as concerns Amendment No. 84, I feel that my noble friend, at the very least, has gone rather over the top in terms of drafting. I suspect that the Minister will tell us that her last phrase referring to the penalty,
"a fine not exceeding level 5 on the standard scale",
actually belongs in Clause 16 rather than Clause 14. That clause deals with all the other fines and penalties under the Bill.
Like my noble friend, I suspect that, although the provision appears in the Food Safety Act 1990, it is unlikely to have any relevant application to this particular Bill. However, I would suggest rather gently that that is no good reason for leaving it out.
The Earl of Erroll: I should have thought that the new clause is eminently sensible and is logically a very good part of checks and balances. If all one's accounting records and such documents have been taken and retained, presumably one would eventually have problems with the VAT man. One could end up in the courts being locked up for other offences as well. So one must have some kind of appeal.
Lord Naseby: I wholeheartedly support my noble friend on the Front Bench. It seems to me that while perhaps 99 per cent of trading standards officers and others involved are entirely reliable, life being what it is, there will always be the odd person who is not as reliable. There may be instances—it may only be one case in 10 years, it does not matter—where either there should be compensation or an appeal. I cannot think that any government would want an Act on the statute book where those two provisions are denied to UK citizens. Therefore. I wholeheartedly support the amendment.
Lord Filkin: This is essentially about the proportionality and the likely level of risk that might

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come about under actions by trading standards officers in these circumstances. I shall seek to suggest that the concerns are somewhat over the top, given how one would expect things to operate.
Amendment No. 84 adds a new subsection to Clause 13 which creates a new criminal offence for trading standards officers or anyone accompanying them in connection with investigations under the Bill if they divulged any information constituting a trade secret.
I do not think that there is a need, however, to add to the weight of offences on the statute book by creating a new offence applicable to TSOs in the course of enforcing the provisions of this Bill.
An enforcement officer goes on to business premises and, for example, sees something which constitutes a tobacco advertisement or is connected with a possible offence under the Act. There will be no trade secret in a leaflet offering a free cigarette lighter in return for packet tops or a branded open and closed sign which a newsagent has omitted to remove. Even if the information is something more sensitive, such as a computer programme, the question arises: what is a trade secret in these circumstances?
The penal provision is not necessary and we have received no representations from business interests that it is required. As with Amendment No. 5 where the option of civil action is available, if enforcement officers or a person accompanying them did divulge a trade secret, they could be subject to civil action, which, as the noble Baroness will know, carries a lower burden of proof and the potential for substantial damages, if so found. So in practice the civil courts already provide an effective remedy.
Under Amendment No. 85, this new clause gives any person whose goods are detained by an enforcement officer under Section 14(1)(c) of the Act the right to apply to a court to have them returned. It repeats the wording of Section 33 of the Consumer Protection Act.
Clause 14(1)(c) of the Bill gives enforcement officers the power to take possession of any book, document, data, record or product and retain it as long as is considered necessary for the purpose.
Clause 14 follows closely the equivalent provisions in the draft regulations which were made in connection with the European Directive 98/43/EC. We consulted widely on these regulations and received no representations to the effect that a provision for appeal similar to this new clause may be necessary.
I do not believe that it is necessary to reproduce the provisions of Section 33 of the Consumer Protection Act here. In cases under that Act the powers are more wide-reaching, reflecting the gravity of the subject matter—for example, unsafe goods—and enforcement officers are likely to have to seize whole consignments of goods which they consider to be unsafe. Under this Bill, which is about tobacco promotion not unsafe goods, there is no need for such measures. Any taking of possessions is likely to involve at most the taking away of items of small value such as a sample copy of a
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magazine or a computer disk for evidential purposes and, in any case, the items may only be retained for as long as is necessary for such purposes.
Under Amendment No. 86, the new clause gives a right to compensation to anyone whose goods are detained in connection with the provisions of the Bill where there is no culpable behaviour found on his part. Again the new clause follows closely the wording of Section 34 of the Consumer Protection Act.
Clause 14(1)(c) of the Bill gives enforcement officers the power to take possession of any book, document, data, record or product and retain it for as long as they consider necessary for the purpose.
Clause 14 follows closely the equivalent provisions in the draft regulations which were made in connection with the European Directive 98/43/EC. Again we consulted widely on these regulations and received no representations to the effect that a provision for compensation similar to this new clause might be necessary.
I do not believe that it is necessary to reproduce the provisions of Section 34 of the Consumer Protection Act here. Again, in cases under that Act the powers are more wide-reaching, reflecting the gravity of the subject matter—for example, unsafe goods—and enforcement officers are likely to have to seize whole consignments of goods which they consider to be unsafe. Under the Bill, which is about tobacco promotion not unsafe goods, the Government believe that there is no need for such measures. Any taking of possessions is likely to involve at most the taking away of a sample copy of a magazine or a computer disk for evidential purposes and, in any case. the items may only be retained as long as is necessary for such purposes.
I very much hope—perhaps more in optimism than in expectation—that I have convinced noble Lords that there is no need for these amendments. In any event, one expects that ordinary common sense will apply. In the case cited by the noble Earl, Lord Erroll, of a company which believed that its data necessary for completing its VAT returns had been seized, one would expect that it would make immediate representation to the relevant local authority, which would be negligent in not providing at least copies of such documents, so that it could comply with its other statutory obligations in such circumstances.
For these reasons, while understanding the spirit of the amendments, the Government do not believe that they are necessary.
Lord Clement-Jones: The Minister has set out the Government's response very fairly. He put it very mildly as a matter of proportionality and risk. I would probably put it more robustly as sledgehammers and nuts. It is very seductive to look at one Act, whether it is the Food Standards Act or the Consumer Protection Act, and say, "Right, what we have to do is apply those safeguards in this particular Bill". But, that then fails to look at the subject matter of the Bill in question. We are talking far more about intellectual property here than about physical property.

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Of course, under the Consumer Protection Act one could be talking about seizure of quite a large quantity of goods. In the case of a container load of toys imported from abroad, which are unsafe or whatever, then of course one is talking about seizure and very heavy economic compensation if the wrong decisions were taken, and so on and so forth. The same applies under the Food Standards Act. But here we are talking about advertisements and promotions. We are probably not in the short term talking about displays, but we may be in the long term. We are talking about the more non-physical aspects of trading under the Bill. Introducing a series of matters relating to trade secrets, appeals and compensation drawn from other Acts does not add a great deal to the Bill.
The Conservative Benches are normally the first to reject unnecessary regulation in such circumstances, and I hope that they will be consistent in their behaviour in respect of such matters.
Baroness Noakes: I thank the noble Lord, Lord Clement-Jones, for that. I find it curious that he should stigmatise protection as regulation. Those of us on these Benches will always support the building in of protections, especially for the kind of businesses that would be affected by onerous legislation. That is the hallmark of these Benches.
Several points were made, rejecting these modest protections against things that might go wrong. The noble Lord, Lord Filkin, said that the Government had had no representations. It is not the job of the House of Lords simply to pass legislation on the basis of representations. The hallmark of your Lordships' House is that we will carefully consider the way in which legislation is likely to work in practice. Indeed, we have an obligation to think of the practical implications, regardless of whether any of us has received representations to a particular effect.
The point has also been made that we may he talking about things that are of small value compared to the things that might be given protection under the Consumer Protection Act 1987. Again, it is hard to resist protection for individual businesses on the basis that something might be of less value if attacked under the provisions of this Bill. rather than a pre-existing Act.
We do not know whether the powers in the Bill could be used to take things that are extremely valuable to the particular business or individual from whom the items are removed. In particular, a trading standards officer could take physical property, including hard disks, as the Minister said, which could be of significant value to the operation of the business.
In respect of Amendment No. 84, the Minister offered a civil action in place of the criminal penalty that the amendment proposed. Why should the person who has been wrongly subjected to the powers of the Act have to take a civil action? Why can he not look to the powers of the law to deal with the improper use of the powers created by the Act?
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I am unimpressed by any of the responses that have been given on the amendments. Today is not the day to seek the opinion of the House, and I shall reflect further. However, we may well want to return to those aspects of the Bill on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 14, as amended, agreed to.
Clause 15 agreed to.
[Amendments Nos. 85 and 86 not moved.]
Clause 16 [Penalties]:
Lord Naseby Lord Naseby moved Amendment No. 87:
Page 9, line 19, leave out "six" and insert "three"
The noble Lord said: In the absence of my noble friend Lord Palmer—
Baroness O'Cathain: The noble Lord, Lord Palmer, sits on the Cross Benches.
Lord Naseby: The noble Lord may be a Cross-Bencher, but I have known him for the best part of 50 years, and I treat him as a friend. I hope that that is acceptable to the Committee.
As originally drafted, the Bill provided for imprisonment on a summary conviction for a term not exceeding three months, or a fine not exceeding level 5. That was increased in Committee in the other place when the Bill was first introduced, in the last Parliament, so as to make the maximum term of imprisonment on summary conviction six months—in other words, a doubling of the term. At the same time, a new provision was added for conviction on indictment to a term of imprisonment of up to two years or an unlimited fine or both.
The amendment would revert to the penalties originally contained in the Bill. The penalties as they now stand in the Bill seem to my noble friend and me to be excessive, given the nature of the offence and the possibility of inadvertent breaches, which are not likely among the manufacturers, but which may well occur in the retail trade, especially at the smaller end of the trade. I hope that the sponsor of the Bill will recognise that the enhancement of the penalties is rather excessive.
I do not need to make detailed comparisons, but I shall mention one. Under the Misuse of Drugs Act 1971, possession of a class C drug carries a maximum penalty on indictment of two years' imprisonment and an unlimited fine. That provision may perhaps be relaxed in respect of cannabis, with prosecutions not being pursued on mere possession of the drug in small quantities. What then is the justification for regarding a breach of an advertising ban on tobacco products, which are not illegal, as more serious than the possession of an illegal drug? I beg to move.
Lord Filkin: I commend the noble Lord, Lord Naseby, for his industry on the Bill. We certainly cannot claim that it is untested at this stage.

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The noble Lord rightly draws attention to the fact that the earlier government Bill specified just three months—in other words, the case would be triable summarily. If memory serves, it was as a result of Opposition amendments in the House of Commons that it was increased to six months—in other words, an indictable offence. There is a certain ping-pong going on, which could be played for some time. I hope not.
Lord Skelmersdale: Perhaps I may briefly interrupt the Minister. Earlier today I said that it grieved me to have to argue with my noble friend on the Front Bench. I do not see any good reason why my noble friend Lord Naseby should disapprove of actions taken by the Opposition in another place.
Lord Filkin: I thank the noble Lord, Lord Skelmersdale. Perhaps I may move on to the substance of my response.
Clause 16 in its present form provides a wide range of penalties which the Government believe will enable courts to ensure that the punishment fits the crime. Indeed, there could well be a wide range of circumstances involved under the terms of the Bill. They would range from one extreme, the corner shop which had broken the law, right through to a multinational corporation which had sought vigorously and persistently to promote tobacco products in the United Kingdom, despite the provisions of this legislation. Because of the range of circumstances, I urge the Committee to reject the amendments which, if adopted, would reduce the maximum penalties available and so would not provide a sufficient deterrent for persistent offenders with deep pockets.
The option of conviction on indictment opens up the possibility of unlimited fines which will deter the serious corporate offender. At the other end of the scale, first offences committed by small retailers would attract relatively low fines in a magistrates' court, being enough to remind everyone that the law exists and will be enforced. Therefore the Bill in its current form allows for both circumstances to be dealt with appropriately.
As was said earlier, trading standards officers see their role as twofold. They are there to educate employers and prevent the law being broken first and foremost. They are also there to enforce the law. They will judge each case on the basis of its individual merits, using similar examples where appropriate.
The Government do not believe that these are excessive penalties. Clause 16(2) currently provides for up to two years' imprisonment on indictment. It we are going to make these offences triable on indictment, we could not provide for less. There are literally hundreds of other offences with similar tariffs. The Food Safety Act 1990 has such a penalty in relation to the offence of rendering food injurious to health with intent to sell it for human consumption or selling food for human consumption which fails to comply with food safety requirements. The Betting and Gaming Duties Act 1981 provides for imprisonment for up to two years for the offence of providing a gaming machine in contravention of restrictions set out in the Act. Other Acts make similar provisions.
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If enacted, the Bill would not imprison innocent shopkeepers for years or close down their businesses. Courts will take into account all the circumstances when sentencing, but they must have appropriate sentences for offences at both ends of the scale; that is, both for minor first offences and for serious, large corporate offenders. For those reasons, we suggest that the amendment would be inappropriate.
Lord Clement-Jones: I must confess that I am not entirely clear about the background to the introduction of the indictable offence in Clause 16, or who instigated it. However, I suspect that the motives of those introducing it were to provide greater protection. If an offence is to be triable "either way", as the criminal lawyers refer to it, then the defendant is granted the benefit on indictment of having a Crown Court hearing and a circuit judge to try the offence. I suspect that is why paragraph (b) has been put in.
You cannot have an indictable offence unless you have those forms of offences. You cannot have it both ways: either there is the protection of the Crown Court and the full mode of trial on indictment or there is the possibility of a trial in the magistrates' court. I am sure that most noble Lords would agree that offences may or will be committed under the terms of the Bill which are so serious that they need to be tried on indictment, whether that is the choice of the defendant or of the prosecution, and that in certain circumstances the fine should be more than £5,000 or the prison sentence longer than six months. Here I refer to pretty major cases, those of corporate abuse on a large scale. But one needs the power to be able to impose a fine of more than £5,000 because that sum would be rather like receiving a parking ticket for a multinational corporation. One has to consider far larger fines for the legislation to bite and to ensure that the behaviour in question is not repeated.
I do not think that the penalties are disproportionate, but rather that they are fair. It is clear that they were considered quite closely in the other place during deliberations on the previous government Bill. I believe that those deliberations resulted in the right conclusion.
Lord Naseby: I have listened with care to the Minister and to the proposer of the Bill. Although I am not a lawyer, the element I find strange is why the provision should be that much stronger than anything in the consumer protection Acts where the problems encountered will be at least as great, or even greater, in particular when dealing with the dimension of safety. It is the differentiation that appears in this Bill from the consumer protection Acts that I find rather difficult to work out. Why should the two be so different? At this stage I shall withdraw the amendment and reserve the right to return to the matter.
Amendment, by leave, withdrawn.
[Amendment No. 88 not moved.]
2.15 p.m.
Lord Campbell of Alloway Lord Campbell of Alloway moved Amendment No. 88A:
Page 9, line 22, at end insert—
"(3) In the absence of evidence which establishes beyond reasonable doubt that tobacco advertising as prohibited by section 2 or 3 of this Act or by regulations made under this Act would increase overall consumption or induce young persons to smoke, no penalty may be imposed under or by virtue of any provision of this Act if, at the conclusion of the hearing on an alleged offence, notice of intention is given—
(a) to seek a judicial declaration of non-conformity of the Act with the provisions of articles 8 or 10 of the European Convention on Human Rights; and
(b) to apply to the European Court of Justice for a declaration that, contrary to the provisions of the European Union Treaty, the Act distorts competition within the single market and inhibits the freedom to provide goods and services.
(4) Steps to institute proceedings under subsection (3) above must be taken within 28 days from the conclusion of the hearing on the alleged offence.
(5) A penalty may only be imposed after it has been determined judicially that the Act is in conformity with the European Convention on Human Rights or the European Union Treaty."
The noble Lord said: I move this amendment at the request of my noble friend Lord Brougham and Vaux. I declare an interest having drafted the amendment—at no one's request—the first time around on the Government's Bill when I was not a member of the Joint Committee on Human Rights. I thank my noble friend Lord Brougham and Vaux for having tabled the amendment.
I have already declared my other interests. I speak only for myself but, as the issue has been discussed and is relevant, I should say that membership of the club in no way increases the consumption of tobacco. When we meet, wives and children and so on are not there. They are private affairs attended by members of the club and of the tobacco trade. They are certainly not exercises in commercial sponsorship of any kind. I have been a member for years and I change the brand of tobacco that I smoke either for convenience or through choice. My membership of the club has absolutely nothing to do with my personal, private and rather disgusting habit.
My speech will go wide of the purpose of any other amendment. It seeks to deal with the reality of the ultimate resolution, which will be inevitably a matter for the courts. They will have to resolve a crucial and complex—
Lord Peston: Perhaps I may interrupt the noble Lord for clarification. Is he addressing Amendment No. 88A?
Lord Campbell of Alloway: Yes.
Lord Peston: I am a bit lost as to what it has to do with what the noble Lord has been talking about—membership of clubs and so on. Have I got the wrong copy of the amendment or what?
Lord Campbell of Alloway: I do not know what the noble Lord has got, but I am grateful for his intervention, as I always am. Perhaps I may continue.
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The keystone of the structure of the amendment is the final subsection which prohibits, on a conviction which may be set aside on appeal, the imposition of a penalty until the rectitude of that conviction has been determined on appeal by either the European Court of Justice or the ECHR. If it will assist the noble Lord, Lord Peston, the clause is concerned with penalties.
There is no doubt that those concerned with the manufacture and sale of tobacco would wish to maintain that the proposed regime, if enacted, would not be prescribed by law, as explained in paragraph 14 of the report of the Joint Committee. There is no doubt that this is a restrictive regime on advertising, promotion and sponsorship. It is, prima facie in law, in restraint of trade and unlawful unless justified by those who propose it. It is a burden—at this stage it is not interesting to say whether or not it is a heavy burden—that they have to discharge.
It is inevitable that a test case will be mounted in our courts, which will apply EC law, which is between member states and is supranational. Having found the facts, our courts will refer the matter to the European Court of Justice at Luxembourg for its opinion. It is equally plain from the report of the Joint Committee that that would be the position not only with Luxembourg but with the Court of Human Rights at Strasbourg. It is well known that the court at Luxembourg has already struck down certain articles of Council Directive 98 as ultra wires.
This is not the time to enter into any detailed argument and there is little more that I have to say. However, I ought to place certain matters on record as this is a probing amendment and will obviously have to be reconsidered in the light of such reactions as I hope I may evoke.
In the context Article 10 of the ECHR, the problem is one of justifying the regime as proportionate. A similar problem arises with Articles 28 and 49 of the EU law. The matter is dealt with in paragraphs 12 to 25 of the report. Perhaps I may leave it like that, so that it is on record, and perhaps we can return to the matter. It takes too long to deal with in any other way.
At paragraph 23 the point is taken, relevant to Community law and ECHR law, that there should be clear evidence that nothing short of a total ban on tobacco advertising and sponsorship could be expected to achieve its legitimate object—that is, the public health safeguard and whether the effect of the ban on advertising would be to decrease overall consumption. That is dealt with at paragraph 33.
It will be for the courts to evaluate the evidence as to whether those who support the regime can establish beyond all reasonable doubt—it is a criminal case—that without this regime overall consumption would increase, the young would be induced to smoke, and so forth. The matter cannot be decided in this House; it cannot be decided in our Parliament. The only way in which this legislation can be dealt with is by the courts. First, they have the difficult task of finding the facts on the evidence—of course, there is a total conflict of fact. Then, they must decide whether, within the meaning of

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what is "proportionate" in law, a total ban can be justified. If it cannot, the action will be unlawful. I beg to move.
Baroness Finlay of Llandaff: I would not dare to comment on the latter part of the amendment, but perhaps I may comment on the first paragraph. The amendment states that it must be established beyond reasonable doubt that tobacco advertising would increase overall consumption or induce young persons to smoke. That implies that a lawyer could argue that you were excluding all the data that affected older people and all the data on passive smoking. Removing those numbers from the data collected in evidence, leaves numbers potentially small enough to make it impossible to prove scientifically (statistically) that "p<0.05"—in other words, in terms of the data, that this was not a probability; it was not a 1:20 instance due to chance. That is the nature of the scientific statistics, whereas the figure known as the 95 per cent confidence interval is used. I have a real concern that restricting the allowable data to that extent and honing the issue down so enormously would make a mockery of the use of scientific data anywhere.
The word "consumption" is also potentially misleading, because there is no definition of it. I foresee endless arguments over whether it related to consumption of different numbers of cigarettes, of different strengths of tobacco or of particular carcinogens or agents in tobacco. Proving that in relation to passive smoking would be particularly difficult.
The other problem is that the data prior to the introduction of the Bill were not collected with a view to being able to collect them afterwards. Scientifically, prospective data are much more powerful than retrospective data.
I have a genuine concern that the amendment could put all of scientific data on trial.
Lord Campbell of Alloway: If it is convenient to the Committee, I should like to reply to the noble Baroness's two points quickly. I take her first point. I had been worried about the drafting too. The amendment must be redrafted.
The noble Baroness's second point was about endless arguments. There will be a vast case—maybe two cases—but once the basis has been decided, as with the restrictive practices legislation winch produced three key cases, there will be no more. There will be endless argument, but the issue must be resolved. It will never be resolved below the level of the Appellate Committee of this place. I accept that. However, once the principle has been established, the issue will narrow down to a matter of the facts in each case.
Lord Peston: I agree with the noble Baroness, Lady Finlay, but I think that the matter is much more serious. I am genuinely surprised that my good friends the noble Lords, Lord Brougham and Vaux and Lord
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Campbell of Alloway, have associated themselves with an amendment that is totally destructive of the basis of the Bill. The amendment should not be before the Committee. We are talking about a noxious product that does massive damage to people. That is the basis on which we are dealing with the Bill. We are not going over the scientific evidence. The suggestion behind the amendment is that those matters are still in doubt, but they are not. We are not legislating on the basis that this is still an open question. I do not remember exactly when the original research on the dangers of smoking was conducted, but it was 30 or 40 years ago.
Lord Campbell of Alloway: The noble Lord says that it is not an open question, but I say that most assuredly it is. This is the dimension of the dispute on fact. We have to face up to it.
Lord Skelmersdale: My noble friend and the noble Lord, Lord Peston, seem to be at cross purposes. We all know about the effects of smoking. Nobody in the Committee disagrees with that. However, we do not know what the effects of the Bill will be. That is why I put my name to Amendment No. 90. We would be far better off waiting until the Bill has been in force for six years, 10 years or whatever, and then deciding whether it should remain on the statute book. That seems the sensible way to proceed.
Lord Peston: I should like to finish my remarks. I thought that we were debating Amendment No. 88A as a separate amendment, not as part of a group. That is the amendment that I am objecting to extremely strongly. We shall come on to the points raised by the noble Lord, Lord Skelmersdale—if we get a move on and I do not take too long—in a few moments.
The amendment is destructive of the Bill and I repeat that I am genuinely surprised that it is before us. I hope that it is withdrawn and we do not waste any more time on it.
Let me add two points now rather than later. First, the noble Lord, Lord Campbell of Alloway, implied that noble Lords could not legislate in this field: that we had to wait for the European Courts and lawyers to decide matters that I thought—we are still a sovereign Parliament—we could decide ourselves.
Secondly, my experience of almost all legislation and everything else is that we do not know for certain what will happen. To make a nasty point, when we privatised the railway industry we did not know for certain what was going to happen. Those of us who opposed the legislation thought that bad things might happen. But the Government did not automatically introduce a six-year clause, saying that they would nationalise the railways again if the legislation did not work out. We legislate in this Chamber on the assumption that we are doing the right thing and with confidence—it may not be 100 per cent—that it will work out. We do not need to add specific six-year or three-year periods, with appeals to all kinds of other courts, in order to legislate. I hope that we shall go

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ahead with the Bill without the additional provisos. Having said that, it enables me not to speak when the noble Lord moves his amendment.
2.30 p.m.
Lord Skelmersdale: I hope that the noble Lord will listen because I shall respond to that amendment and not now.
Lord Hunt of Kings Heath: Perhaps I may dare to say that my noble friend was a little unfair to the noble Lord, Lord Campbell. My assumption is that the noble Lord raises the amendment in the light of the discussions of the Joint Committee on Human Rights of which he is a member. My honourable friend Ms Yvette Cooper, the Minister for Public Health, wrote a letter responding to the points raised by the committee, a copy of which has been placed in the Library. I have no doubt that that might inform our debate if we return to the issue on Report.
The issue is whether there is clear enough evidence to support the contention that only a comprehensive advertising ban would be sufficient to bring about the desired reduction in tobacco consumption. I suspect that that takes us on to the next amendment. I have no doubt that while there may be disagreements about that from the Government's point of view, in the letter that Yvette Cooper sent to the Joint Committee on Human Rights the Government state firmly their own belief that there is clear evidence and that, therefore, it passes the test posed by the Joint Committee.
I fully accept that the noble Lord, Lord Campbell, raises the matter as a way of getting that debate on to the Floor of the House. Perhaps I may suggest that if we return to the issue on Report we have the benefit of the response on that matter from the Department of Health to the Joint Committee.
Lord Clement-Jones: That is a constructive way forward. The wonderful thing about having the Minister speak before me is that my speech then looks extreme compared with his moderation.
I resent the attempt to introduce the notion of fundamental human rights into the issue of tobacco advertising. The banning of tobacco advertising is in no shape or form a breach of fundamental human rights. If we believe that we have evidence, it is perfectly respectable and responsible to pass the Bill in its current form without caveats in the form of sunset clauses, and so on. I have no doubt that we shall be talking about that.
The noble Lord, Lord Peston, made a splendid point about privatising the railways and why we should not add sunset clauses to such legislation. One can cite dangerous dogs legislation. What evidence was there that banning dangerous dogs was going to be useful? I think that probably the evidence is against that now. Let us discuss that in another debate. It will be helpful if we have all read the letter in the Library, as the Minister suggests.
Lord Campbell of Alloway: Having got on to dangerous dogs. one has really no option but to
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withdraw the amendment at once. I am grateful to the Government Front Bench for having realised the importance of what I was trying to do, which is always helpful because it is so rare that anybody in this House—and certainly not the noble Lord, Lord Peston—ever understands what I want to do. But at least I am grateful for small mercies. With a "goodbye" to dangerous dogs, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 16 agreed to.
Clauses 17 and 18 agreed to.
Clause 19 [Transitional provisions: sponsorship]:
On Question. Whether Clause 19 shall stand part of the Bill?
Baroness Noakes: I have given notice, together with my noble friends Lady Anelay of St Johns and Lord Luke, that I wish to oppose Clause 19. This is in order to explore the Government's position regarding the transitional provisions on sponsorship, as they will affect sports such as darts.
Clause 19 allows the Secretary of State to make regulations to specify when the ban on sponsorship in Clause 10 should take effect. We know the latest date on which it could take effect is 1st October 2006 and we also know that the Government intend to give preferential treatment to Formula 1 and to snooker. They will be allowed to escape the effects of the Bill until 2006: other sports will not.
I have nothing whatsoever against either Formula 1 or snooker but I object to the Government treating other sports unfairly. It is perverse to say that these two sports are global and therefore can have until 2006 to sort out their sponsorship deals whereas other sports like darts have to face a cliff-edge drop in sponsorship by 2003, even though it has players from across the globe and has global appeal.
The Government have said in the past that they would set up a taskforce to help sports adjust their sponsorship deals, but to suggest that sports can find replacement sponsors easily is a misunderstanding of the commercial marketplace. The current shortfall is estimated to be £10 million, with an additional 10 million for marketing sporting events.
The secretary-general of the British Darts Organisation, Ollie Croft, wrote to my honourable friend in another place, John Greenaway, to make this point about the taskforce:
"The taskforce was simply a gesture to give the impression that we were being given assistance. In truth. there probably is not a business out there which can replace the funding we receive from Imperial Tobacco. Our main concern is that we have only until 2003 to save our sport. What would help enormously is an extension to 2006, like Formula One and snooker. We can fulfil the Government's criterion of being a global sport. The number of countries which are members of the World Darts Federation or associate international members of the British Darts Organisation shows that this claim can be justified".
When my noble friend Lady Anelay raised these points in the Second Reading debate last March the Minister stated that he did not wish to prejudge the

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consultation process during which the British Darts Organisation would be able to make representations. Will the Minister give the House details about the progress made by that consultation process? Do the Government recognise that darts is indeed a global sport?
The Minister will no doubt be aware that the England team recently won all the gold medals in the Darts World Cup in Kuala Lumpur, and in the 2002 Embassy World Professional Darts Championship 13 of the 54 playing nations were represented. Indeed it was won by an Australian, Tony David, who is a non-smoker. The Embassy is a high-profile TV event enjoyed by millions of viewers, and flies the flag for the UK. I am told by the British Darts Organisation that just last week BBC TV Sport signed a new three-year contract to continue screening the world championships. Surely it would be in nobody's interests for this event to be dropped because the British Darts Organisation would be forbidden to obtain sponsorship from the tobacco industry.
Is the noble Lord, Lord Clement-Jones, aware of the social benefits of darts? When youngsters play darts, they learn discipline and basic mental arithmetic. It is not expensive as a hobby and it has no language or cultural barriers. It is indeed a sport for all.
I hope that the Minister will tell the House today that the Government have reconsidered their position and that darts will be treated in the same way as snooker so that its deadline for tobacco sponsorship is extended to 2006.
Lord Faulkner of Worcester: I think that the noble Baroness rather shot herself in the foot with a dart when she said that darts is a sport for all, particularly enjoyed by young people. That is precisely why the continued sponsorship of darts by the tobacco industry is so undesirable. I would be appalled if the Minister were to tell us that, for some reason, he has found an excuse for extending the ban applying to t he British Darts Organisation beyond 2003. My own preference would be for a 2003 ban to apply to everyone, including global events. I understand, however, why that is not happening.
It strikes me as utterly perverse to regard darts as an exception, particularly when, as the noble Baroness said, it is watched and enjoyed by millions of young people. My understanding is that darts as a sport has done relatively little to find an alternative sponsor to tobacco, unlike all the other sports that have received tobacco sponsorship such as Rugby League, cricket and Rugby Union. I think that the problems facing darts are very much of its own making. As I said, I hope that the Minister will resist the suggestion.
Lord Peston: I, too, am indebted to the noble Baroness, Lady Noakes, for raising the issue as I wish again to support what my noble friend Lord Faulkner has said. The logic of the noble Baroness's comments is that everyone should be treated equally. As your Lordships know, I chair the Economic Affairs Committee, which is devoting its life to globalisation, but it had not occurred to me that racing cars and
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snooker are central to global issues. My view is therefore almost exactly the same as that of my noble friend Lord Faulkner; we differ only in that I think it disgraceful that motor racing and snooker have been given any leeway at all. My noble friend says that he understands why they have been allowed that leeway, but I cannot understand why such alleged sports feel that it is right to take money from the tobacco companies. My own view is that, if they cannot survive without tobacco sponsorship, they should not be engaged in the activity at all.
I feel terribly sorry about the darts people. I was always hopeless at the game, but loved playing it and had great pleasure when my dart occasionally hit the board. None the less, the issue has perhaps clarified the Bill's generosity and the fact that it is not taking the draconian approach that people like me would prefer. I would love to hear my noble friend the Minister say that the Government have changed their mind and have no intention of giving special protection to snooker, let alone motor racing.
Lord Naseby: The noble Lord. Lord Peston, says that he has no idea why Formula 1 is exempt. We all know the reason: the Labour Party took £1 million-plus from that particular industry. The sum was paid back, but it caused great embarrassment on the Government Benches. I feel sorry for the Minister, who will have to reply on this point. All that the noble Lord, Lord Peston, has done is to re-emphasise that embarrassment.
I take slight issue with my noble friend Lady Noakes as I have never regarded darts as a young person's sport. I suspect that it is played in every pub in the country, and that, on the whole, darts players are not particularly young. Certainly in my former constituency, the more skilful darts players tended to be rather elderly, and darn good at it they were, too. I therefore suspect that its age profile is rather older than that of other sports.
The Bill will ban sponsorship. We may or may not agree with such a ban, but that is the Bill's purpose. My noble friend Lady Noakes is simply saying that all sports should be treated equally. Although the treatment itself and the commencement date are matters for debate, I see absolutely no reason not to treat every sport identically—other than the Government's embarrassment at having accepted £1 million from the motor racing industry, and then suddenly finding snooker on the side. It is all a bit of spin.
2.45 p.m.
The Earl of Erroll: We have massive amounts of anti-discrimination legislation, equality legislation etcetera to do with human beings. I cannot see why those concepts do not apply also to sports, companies and everything else. On the ground of equity I believe that they should all be treated the same.
Lord McNally: I declare an interest in that darts is the only game or sport that I have ever been remotely good at. It is for that reason that I intervene. It is

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probably the only time in this Bill that I shall agree with the noble Lord, Lord Naseby, in that he told the truth, the whole truth and nothing but the truth as regards why there is this shameful anomaly in the Bill.
Noble Lords: Oh!
Lord McNally: I shall not cry. "Author, author" at this point.
Lord Naseby: The noble Lord will know that I spent 25 years in the advertising industry. He will also know that I was party to the quote that he offered. I hope he is not suggesting that anything I have said at any stage in this Bill has been anything but the truth as I believe it to be.
Lord McNally: No, of course not—full and fair.
It is interesting to note that the Sports Council and, indeed, the department for sport refuse to recognise darts as a sport but still class it as a leisure pastime. That is an absurd slight to the sport of darts, as anyone who has ever played it will recognise. I believe that the noble Baroness, Lady Noakes, approaches the matter from the wrong angle, but that the noble Lord, Lord Faulkner, was correct. What should emerge is a parity of treatment which removes the privilege that has been accorded to motor racing and snooker. In the meantime, darts, along with other sports, should with a sense of urgency face up to the idea that the tobacco sponsorship option is not available. Like the noble Lord, Lord Naseby, people make money in this business through creative thinking. My creative thinking consists of asking whether those involved in darts have ever thought of approaching Slim-Fast as a possible sponsor?
Lord Hunt of Kings Heath: I pay tribute to the eloquence of the noble Baroness, Lady Noakes, on behalf of the sport of darts. I did not take her to be a darts player but I think she must have been to be able to put over that point with such passion.
Like the noble Lord, Lord McNally, I was a darts player in my youth. I spent many happy hours in my early twenties playing darts with my right honourable friend the Chief Secretary to the Treasury. That was a clever ruse on my part to ensure that 30 years later we might get extra money out of the Treasury for the Department of Health. I hope that that ruse will continue to pay off in the years ahead.
I was disappointed with the unusual and unworthy cynicism of some Members of the Committee in relation to the reason for the Government's policy on this matter. The Government have been coherent and straight on the matter. We said that sponsorship of events with a view to promoting tobacco products must stop as it is a powerful way to promote smoking. We also said that we do not want that ban to harm sports. For some time we have made clear that, subject to consultation, we expect most sponsorship of sporting events to end by July 2003, but that global sporting events which receive considerable income
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from tobacco interests should be given until October 2006 to do the same, provided, first, that they do not sign new contracts with tobacco companies and, secondly, that they phase out the current sponsorship that they receive. As the noble Baroness suggested, Clause 19 gives Ministers the regulation-making powers to deliver that policy.
It is some years since the Government announced their plans to bring tobacco sponsorship to an end. Frankly, sports concerns have been given ample time to think about other arrangements. The Department for Culture, Media and Sport set up a task force to help sports likely to be affected by a ban on tobacco sponsorship. I checked with the department this morning that it will continue to be available to provide advice to the relevant darts associations on finding substitute sponsorship. I am sure that that is the most appropriate way forward for darts sports as a whole.
As to which sports are likely to he included under the global classification, if the Bill is enacted there will be a consultation period before any regulations are made under Clause 19. They will set out criteria that will need to be satisfied by sports wishing to retain sponsorship for the longer transitional period. I cannot prejudge the outcome of that consultation and indicate which sports might qualify.
Subject to any persuasive arguments made in consultation, the intention remains to implement broadly the longstanding policy of distinguishing between global and non-global. Key is that, at the end of the day, all tobacco sponsorship will be banned. It is just a question of a transitional period. On that basis, Clause 19 is appropriate. In relation to darts sports, I recommend that they continue a dialogue with the department.
Lord Clement-Jones: The noble Baroness hit a double-top with this interesting debate, if not a bull's-eye. If the Minister is saying that the consequence of his playing darts with the Chief Secretary to the Treasury is more health funding, the Liberal Democrats will sponsor the noble Lord's future games.
It is clear from the remarks of my noble friend Lord McNally that we deeply resent the existing exceptions to sponsorship banning by 2003. We see no justification for the exceptions for snooker and Formula 1. Max Moseley, the head of FIA, was quoted as saying that Formula I would be able to find the money—so it is incomprehensible that exception was given.
Clause 19 is potentially discriminatory against the sport of darts because I worded the Bill in exactly the way that the Government had it, because I knew that the Government would not support the Bill unless it was phrased that way. That is entirely the motive and justification for the Bill's current wording. If it is not satisfactory, would that the Government, at this late stage, change their mind. I suspect that is not possible and that the noble sport of darts will be discriminated against. When I watch television in the evening and see the viewing figures, it is an eminently sponsorable

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sport. I dare say that some of the crocodile tears will quickly dry and that alternative sponsors will be found.
Lord Naseby: Before the noble Lord sits down, may I be clear that he—as the Bill's promoter—would like to see all sponsorship ending in 2003. So if an amendment to that effect were tabled on Report, obviously the noble Lord would support it. Is that right?
Lord Clement-Jones: The noble Lord has been around long enough to know that any Bill that passes through this House must seek the support of the other place. That is the reality of the matter.
Baroness Noakes: I want to put on record that do play darts and learnt it at a very young age. I found that useful in my youth because it was a game at which I could beat men.
More seriously, I seek clarification from the Minister. He said that he would undertake consultations and that he believed that, subject to those consultations, there would be a long transitional period for global sports. I did not hear him say whether he regarded darts as a global sport; I should be grateful for clarification.
Lord Hunt of Kings Heath: No, I do not think that I am in any position to say whether darts is a global sport. That decision would be determined by the outcome of the consultations on the regulations.
Baroness Noakes: On the same basis, would the Minister say whether Formula 1 and snooker are likely to be treated as global sports?
Lord Hunt of Kings Heath: For the very reason that I gave in my original answer, no, I cannot.
Lord Peston: The important theoretical point is whether we will at least be told what the word "global" means in this context. Another sport might say that it was "global" or I might be able to argue that, but I do not remotely see how snooker or motor racing could be defined as "global" within any reasonable meaning of the word. Is there a document that I have not read about its meaning, or will there be such a document? This is a serious matter and I am totally with the noble Lord, Lord Clement-Jones. I still do not regard it as impossible at this stage to deal with the matter, apart from the noble Lord's correct technical point that the Bill has got to get through the House of Commons.
Lord Hunt of Kings Heath: Those definitions will have to be developed as part of any future consultation process. The draft regulations that were developed in relation to the original 1998 EC directive state:
"'exceptional global event' means an event or activity that takes place in at least two continents and three countries and which is the subject of a sponsorship contract for which the financial consideration is in excess of two and a half million pounds per annum".
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I do not say that that definition will continue but it gives a broad outline of the original thinking.
Lord Naseby: Could the Minister confirm that those words were supplied by the United Kingdom?
Lord Hunt of Kings Heath: They may well have been supplied by the United Kingdom but that is riot particularly apposite to this debate. As I said to my noble friend Lord Peston, those matters will have to be revisited—on the assumption that the Bill is enacted—when regulations are consulted on in relation to Clause 19.
Clause 19 agreed to.
Baroness Noakes Baroness Noakes moved Amendment No. 89:
After Clause 19, insert the following new clause—
"COMMISSION OF BODY TO STUDY THE EFFECTS OF ACT
(1) The Secretary of State shall commission a reputable and appropriate qualified body to carry out a rolling study of the effects of this Act on—

(a) the prevalence of smoking in the United Kingdom population, with particular reference to the uptake of smoking by persons between the ages of 16 and 19 and under the age of 16; and

(b) the effect of this Act on market shares of different participants in the tobacco industry.

(2) Following the third anniversary of this Act coming into force, and annually thereafter, the Secretary of State shall arrange for an annual report of the findings of the study commissioned in accordance with subsection (1) above to be laid before Parliament."
The noble Baroness said: In moving this amendment, I shall speak also to Amendment No. 90.
Amendment No. 89 would require the Secretary of State to commission a rolling study of the effects of the legislation on the prevalence of smoking in the UK, with particular reference to the uptake of smoking among 16 to 19 year-olds and the market share of different tobacco industry participants. The intention is that the study would report after three years and annually thereafter.
Amendment No. 90 would introduce a sunset clause that would take effect after six years, and its continuation would require an order that was approved by both Houses. The Secretary of State may make that order if he is satisfied that the legislation has led to a reduction in the prevalence of smoking, with particular reference to the uptake of smoking among 16 to 19 year-olds. He would of course have available to him, if Amendment No. 89 is agreed to, three reports from the rolling study before making that order.
The amendments have their roots in the interesting Second Reading debate on this Bill and, last year, on its predecessor, and in our first two Committee days. The issue is the evidential basis for banning tobacco advertisements, not for the harmful effects of smoking. We should also consider whether a ban will lead to a drop in consumption, particularly among young people, who are believed by many to be the target of tobacco advertisements in this country.
Those who support this Bill do so because they believe that banning tobacco advertising will lead to a reduction in tobacco consumption and that that in turn will lead to fewer deaths from tobacco-related illnesses. But do they have conclusive evidence? In the red corner we have the report of Mr Clive Smee, a highly respected economist in the Department of Health. It concluded that, on balance, banning tobacco advertising led to a fall in smoking.
In the other corner, we have the later report of KPMG. I should say that, as a partner in KPMG when the report was produced, I probably had a financial interest in it. However, I had nothing whatever to do with the report and, indeed, had not heard of it until I came to your Lordships' House. The report concluded that there is overwhelming evidence to support the proposition that advertising bans on tobacco products do not reduce tobacco consumption.
Both reports looked at the evidence available from many studies abroad and came to different conclusions. I shall not repeat the detailed arguments here today. My main point is that neither corner has landed a knock-out blow. The evidence is not clear beyond peradventure.
A particular concern of the supporters of the Bill is the effect of advertising on the young. I, for one, should have no hesitation in banning tobacco advertising if it were shown that the uptake of smoking among teenagers in this country were related to tobacco advertising. During our previous Committee day, the noble Baroness, Lady Jay, informed the Committee about brand-recognition impact on young children. She mentioned a character called "Joe Camel" and other marketing campaigns in the US. They were very interesting but they did not constitute evidence about the impact of advertising on the uptake of smoking among the young or, indeed, about the impact on children in this country.
The evidence that we have from the Office of Population Censuses and Surveys indicates that social factors predominate in the characteristics of children taking up smoking. The price and availability of tobacco are also likely to be important. The Government's own actions in imposing very high levels of tobacco duty have incentivised illegal smuggling and distribution. That alone may well have increased the likelihood of children having access to cigarettes and taking up smoking. I am not arguing that tobacco advertising cannot affect smoking prevalence or whether or not the young take up smoking. My point is that the evidence is far from conclusive that tobacco advertising does so as a matter of fact.
Some people say that tobacco companies spend their money rationally and would not advertise their products if they did not believe that they would thereby recruit new smokers and increase tobacco consumption. Tobacco companies say that in the mature market in which they operate, in the UK in particular, they advertise in order to promote their brands against the competition and thereby gain
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market share. I was grateful to the noble Lord, Lord Filkin, during our second Committee day for telling us about the example of a Benson & Hedges bistro in Kuala Lumpur. That example demonstrated nicely that such marketing action was taken because, in the words of the noble Lord, Lord Filkin,
"Benson & Hedges was concerned about a relatively weak market share, which was declining"".—[Official Report, 7/12/01; col. 1080.];
that is, the actions were designed to grow market share rather than recruit new smokers.
Whatever the truth about the effect of advertising, we should be able to deduce the impact of a tobacco advertising ban by monitoring what happens when a ban is introduced. That is what the rolling studies proposed in Amendment No. 89 seek to do. The noble Lord, Lord Clement-Jones, said in the context of a sunset clause in our Second Reading debate on 2nd November last year,
"the burden of proof lies squarely on the Bill's opponents, in view of the achievable public health benefits".—[Official Report, 2/11/01; col. 1710.]
I hope that the noble Lord does not deem seeking the truth on the effects of tobacco advertising as opposition because it is not intended as that.
Amendments Nos. 89 and 90 do not oppose the ban proposed in the Bill. They reflect that there is doubt about the effect of a tobacco advertising ban. I hope that Members of the Committee will agree that the quality of decision-making in this area would be improved in the long term if greater light were shed on the effect of tobacco advertising, in particular on young people.
I do not believe that for the purposes of these amendments it is necessary to prove that banning tobacco advertising will have no effect on consumption. I believe that it is necessary only to say that there are reasonable doubts about the issue and that further studies should be undertaken.
Amendment No. 90 reflects the likelihood that even after five years of study and three expert reports, issues may not be black and white. The noble Baroness referred earlier to the difficulties in proving that conclusively. It is likely that the Secretary of State would not be absolutely certain about the impact of a ban on tobacco advertising on smoking prevalence. Hence the amendment is framed in terms of the Secretary of State being satisfied that the ban has led to a reduction in smoking.
Rightly or wrongly tobacco remains a lawful product in its manufacture, sale and use. The Bill will not change that. Advertising is a lawful activity. Banning an otherwise lawful activity in relation to a lawful product should, I suggest, be evidence based. If the Bill becomes law it will be on the basis of a belief that the ban will have the desired impact on tobacco consumption. At the same time, Members of the Committee should admit that the evidence is not perfect. The amendments would allow the passage of time to provide the further evidence that would be necessary to make the ban permanent. Alternatively, if

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the evidence does not support a ban on tobacco advertising, we should then allow the sunset clause to remove the ban from the statute book. I beg to move.
3 p.m.
Baroness Jay of Paddington: The noble Baroness was kind enough to refer to my earlier contribution in Committee. I accept that it would be extremely helpful from all points of view if we had more detail, and, particularly, more comparative research about the impact of tobacco advertising on young people. However, it has never been the position of those who support measures in this field—I speak only for myself and not for the Government, nor, indeed, for the sponsor of the Bill—that banning tobacco advertising will, by itself, reduce the consumption of tobacco. It is seen as part of a wider and significant campaign in health education and other fields to address the prevalence of smoking among those people, who, we have heard today, comprise 70 per cent of existing smokers, who would like to give up, and, more especially, as the noble Baroness said, among those young people, particularly children, who may be tempted to start smoking.
I am sure that the noble Baroness is familiar with the White Paper entitled Smoking Kills, which was published by the Government in 1998 and which led to the provisions of the Bill. That document set out a wide series of proposals for health education and various other means of reducing the prevalence of tobacco consumption, among which, indeed, the banning of tobacco advertising was significant. However, it was not seen as being of itself sufficient to reduce the prevalence of smoking in the way I have described.
It seems to me that the logic of what the noble Baroness said in support of her amendments is that if we wanted to do some kind of comparative study of the impact of the different ingredients of an anti-smoking campaign, we would, for example, have to introduce regulations which enabled us to cease providing nicotine patches on the health service after a specified time in order to carry out that kind of activity. We would need to consider health education programmes as they related to smoking programmes in schools and say that the regulations or provisions under the various forms of education and health education policy that may exist should be time limited in order to demonstrate their effectiveness.
I have always felt that it is entirely consistent to say that the banning of tobacco advertising has been proved to be a significant part of an overall tobacco smoking cessation programme. The international comparisons, for example in Norway and New Zealand, demonstrate that. We know that sufficiently. We are not arguing that this alone will have the impact suggested by the noble Baroness in stopping people smoking or, indeed, preventing children from entering the market. However, as regards children entering the market, I believe that we have sufficient proof that brand recognition of the kind referred to by the noble Baroness, who mentioned my earlier remarks in Committee, has a significant part to play.
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Therefore, the point is that it is insufficient to suggest that if one simply time-limits one part of this campaign, one can demonstrate something conclusively. Since the argument is that one needs all the weapons in the armoury to achieve effective smoking cessation, there is no logical health education or other health policy reason to argue the case that the noble Baroness has.
Baroness Finlay of Llandaff: I support what the noble Baroness, Lady Jay, has just said. I also thank the noble Baroness, Lady Noakes, for having referred to my previous comments. I should of course welcome anything which promotes objective research into any topic. I certainly would have no objection to increasing funding for research.
However, I have a problem with the timeframe put on the matter. If there is to be an allowance for sponsorship to continue in some sports—I do not want to revisit that argument—until possibly 2006, that is six years from when this Bill may be enacted. We are now in 2002. That will take us to 2008. It will give us only two, and not six, years in which to collect evidence. It is practically impossible to collect the kind of evidence of changes in behaviour and changes in patterns within two years, particularly because of the confounding variables which have just been referred to by the previous speaker, the noble Baroness, Lady Jay.
The Earl of Erroll: I have listened to the debate with interest. I wonder whether we should take the two things separately. Obviously, from the point of view of the promoter of the Bill, Amendment No. 90 is unacceptable because he will be desperate to make sure that the legislation stays on the statue book for as long as possible.
Amendment No. 89 has a great deal of merit. As I listened to the fact that it may not even be possible to measure the difference that the legislation will have—and it may have no effect—I suddenly thought that for the last I do not know how many years the advertising of cigarettes has tried to promote the fact that smoking kills. There has been nothing saying that it is healthy—and that has not had any effect. One begins to think, "Well perhaps this will have less effect than one would think". It would be useful to know whether or not it will work, because this Bill could be used as a precedent to attack other legitimate forms of business and so on when there is not sufficient evidence to prove that it will do any good.
It frightens me that we are passing a. Bill which may have no effect. In doing so, we shall probably be destroying certain businesses, possibly certain sports and all kinds of things which have worked perfectly well. I am not saying that we should not do that. I am going along with the matter because that decision has been taken. However, I think that it would he quite wise to sit back and to find out whether the legislation will be effective, so that in six, eight or 10 years' time if it is found to be totally ineffective, people will not start saying, "Well, this is a wonderful example for doing the same thing to something else to which someone else

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objects". Alternatively it may be that Parliament decides that the legislation should be reversed and introduces a Bill to repeal the legislation.
Baroness Gibson of Market Rasen: I speak briefly to my Amendment No. 93, which is self-explanatory. Some noble Lords will know that I have spoken on the issue of employment in particular in the tobacco industry during previous debates.
I must declare an interest. Before I came to your Lordships' House I was a national official of MSF which has had the new name of Amicus since 1st January. Amicus has members who work in the tobacco industry. Rightly or wrongly, they believe that if this Bill is carried—it may be that it is carried with other provisions as well—they are in danger of losing some jobs in the tobacco industry. I remind your Lordships that we are talking about skilled workers. Thanks to those who have been negotiating in the tobacco industry, they are also among our better paid jobs. Those jobs are throughout the country, including in Northern Ireland. I have itemised the areas previously in your Lordships' House. They include areas which already have high unemployment. I have spoken particularly because I have a knowledge of the tobacco industry, but the question of employment could apply also to printers and those involved in advertising.
I hope that by raising this matter today I can have an assurance from the Minister that, if the Bill is passed, an eye will be kept on what is happening with regard to employment.
3.15 p.m.
The Earl of Listowel: I want to draw the Committee's attention to Amendments Nos. 89 and 90. They seem to reinforce the idea that the House should have some form of post-legislative scrutiny, to see that legislation passed in the House is effective.
Lord Skelmersdale: I have been a fan of sunset clauses, unlike the noble Lord, Lord Peston, judging by what he said earlier, ever since I had the opportunity to go to Wellington for a parliamentary conference on statutory instruments in the mid-1990s. I was educated in sunset clauses by the Australian contingent who scatter—there is no other word for it—sunset clauses around their statute book like confetti.
I promised to answer the noble Lord, Lord Peston, at this point, rather than earlier. I would be the first to say to him that such clauses are not always appropriate. That is not because the outcome of the Bill is unclear and therefore it needs a sunset clause; it is because, as my noble friend Lady Noakes said, we are banning the advertising of a perfectly legal product. If it does not work, we should not continue to do it. It is as simple as that. However, governments always rely on the difficulty of finding time to get new legislation—banning legislation, for example—onto the statute book. That is why, in this case, I believe that a sunset clause is important.
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The noble Baroness, Lady Jay of Paddington. and I were both Health Ministers, she much more recently than I. There has been a successful package of measures to persuade people to give up smoking, and this is an extra—to mix my metaphors—arm to that package. I hope that it will continue to he successful, but, as far as one can tell—the evidence is by no means conclusive—banning the advertising of tobacco and tobacco products has, in other European countries, had, to say the least, an erratic effect. For example, consumption in Finland has almost halved, since legislation was introduced on the subject: in Sweden, it has gone done significantly, but not nearly as much; and, in Norway. it has gone up by a small amount.
I do not know what the effect of the legislation in this country will be in six years' time. Nor, to return to what the noble Baroness, Lady Jay, had to say, do I know what effect the total package of measures that will then be in force will have. However, I believe that there is no guarantee that smoking levels will continue to go down. That is why I support the idea of a sunset clause.
I do not think that the lead amendment moved by my noble friend Lady Noakes is very helpful. I am all for the Secretary of State making an informed decision, but I am not entirely sure that the rolling commission that she suggests will help to inform that decision. Perhaps I should say to my noble friend that I am agnostic on that amendment.
Lord Peston: I do not want to speak about sunset clauses, as I have already expressed a view on that, but I would like to say a word or two about research.
I very much support the view of the noble Baroness, Lady Finlay of Llandaff, that we want more research in this area. However, research into behavioural areas is immensely difficult. In my normal cynical mode, I would say that if someone gives me a problem such as this one, I will find an economist, a data set and a statistical method that will come out with answer "A". I will then find a second economist and data set that will produce answer "Not A"—possibly, its reverse. Then, I will find a third one who will not decide between "A" and "Not A".
This is a difficult area. My noble friend Lady Jay was right to say that not only will there be research—the noble Baroness, Lady Finlay, pointed out that it is a fascinating area—but it will require study over an enormously long time period. We need to study several cohorts of young people, starting when the Bill becomes an Act and carrying on more or less through their lifetimes. Only then could we even begin to believe that we can reach an answer, let alone know that we would do so.
With all due respect to the noble Baroness, Lady Noakes, she may be a little naïve as regards how quickly any light could he thrown on to this subject. I can say only that I would take a similar view about monetary policy and the Bank of England. Much as I support the Bank's monetary policy, we could be just as difficult about how clearly research-based it is. I might go further and say that if all legislation had to

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be evidence-based, I doubt whether we would pass very much legislation at all. That might not necessarily be a bad thing.
That leads me to my second remark. Why do we not occasionally use our common sense? I realise that I am not wearing my professorial hat, as I do when I am in the business of promoting research, but if we use our common sense with regard to what the tobacco companies are up to and what they think that they can achieve, it defies belief that they do not consider that they sell more cigarettes as a result of advertising and promotion. Perhaps that undermines the social sciences, but a little common sense in this area is also worthwhile.
I was delighted to hear from my noble friend Lady Gibson that her former union has been renamed. I have learnt at least one new thing today. I congratulate the union on choosing the marvellous name of Amicus. I have devoted my life to supporting full employment as the main objective of government policy and we must never move away from that. However, we have to be realistic. If the Bill is passed and it succeeds, then we hope that fewer cigarettes will be sold, not only in this country but also abroad. There is therefore a genuine threat to the employment or my noble friend's former members. My heart goes out to them because that is something I never want to see. However, that tells us that on another occasion we should consider the whole question of employment policy. We should put in place policies that will help those workers.
Before I resume my seat, perhaps I may make a political point. We do not need any lessons from the other side on the creation of unemployment. They were willing to destroy the coalmining industry and ruin the lives of large numbers of people. It is good news that they seek to defend the position of tobacco workers, but I do not feel that there is any moral weakness on our side if some jobs are put at risk. The route to solving the problem is to look at the whole question of employment rather than to consider tobacco advertising.
Baroness Finlay of Llandaff: I rise for a moment to say that I may have been incorrect in that I should have declared an interest. I have just been invited to become a founder member of the merging charities, the Imperial Cancer Research Fund and the Cancer Research Campaign. If, in discussing research, I did not declare an interest then I ask the forgiveness of the Committee.
Lord Hunt of Kings Heath: I am sorry that the noble Lord, Lord Campbell of Alloway, is not in his place because our discussion now goes to the crux of what he was seeking to achieve; that is, to revisit our debate on Second Reading on what evidence is available to support the contention in the Bill of the noble Lord, Lord Clement-Jones, which is that a ban on advertising would be one significant factor in the effort to reduce tobacco consumption in this country. I must say that I think that my noble friends Lady Jay and Lord Peston got this right. I do believe that the evidence is in place to support the noble Lord's Bill.
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I do not wish to revisit all the reports from which I quoted in our debate on Second Reading, but if we turn to the Smee report, produced in 1992 by the very esteemed and respected economic adviser to the Department of Health at the request of the previous government, we can see that he concluded that the preponderance of positive results does indicate that advertising has a positive effect on consumption. He, too, looked at the evidence from a number of countries, including those mentioned by the noble Lord, Lord Skelmersdale, in his intervention. Professor Smee stated that there were complications in some of the studies undertaken, in the main because advertising bans were often introduced in conjunction with other tobacco control measures. However, he concluded that in each case the banning of advertising was followed by a fall in smoking on a scale which could not reasonably be attributed to other factors.
But it is not only the Smee report. The 1999 report from the World Bank suggested that implementation of the 1998 EU directive could have reduced cigarette consumption within the European Union by almost 7 per cent. There is other, more recent, evidence from the American researchers Saffer and Chaloupka, who studied data from 22 countries. They concluded that tobacco advertising increases tobacco consumption. I do not want to go on.
I contend that there is sufficient evidence to give confidence—to back up the suggestion of the noble Lord, Lord Peston, there is a great deal to be said for common sense in making these judgments—that the Bill is justified. The evidence supports it.
As to research, I should say to the noble Baroness, Lady Noakes, that, as part of the Government's efforts to reduce tobacco consumption, there will be continuing research in this area. The Health Development Agency has a particular interest in evidence-based research in the area of public health, and other organisations will wish to research this area, but I do not believe that that justifies Amendment No. 89.
As to Amendment No. 90 and the issue of a sunset clause, the noble Lord, Lord Skelmersdale, said that he is a fan of sunset clauses. I do not know whether he extends that to legislation on hereditary Peers, but I believe—
Lord Skelmersdale: If the noble Lord is going to quote me, I should be grateful if he would quote me accurately. I said that I had become a fan of sunset clauses "in some circumstances".
Lord Hunt of Kings Heath: Let us examine the kind of circumstances in which sunset clauses should he used. The noble Lord will know that in recent years sunset clauses have been used in relation to the Terrorism Act 2000, the Armed Forces Act 1996, the Imprisonment (Temporary Provisions) Act 1980 and the Northern Ireland (Emergency Provisions) Act 1973, to name but a few. I suggest that sunset clauses are used where the state is potentially given

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exceptional powers to curtail an individual's freedom of movement, and one can understand why they have been used to that effect.
The noble Lord argues that there are special circumstances, which he mentioned, in the tobacco Bill we are bringing forward, but I do not believe that they go so far as to justify a sunset clause. In essence, we should have confidence in what we are legislating for and which is backed up by the evidence.
Lord Skelmersdale: Before the Minister leaves the point he has made, I could translate his words as saying that in 6, 10, 16, 20 years' time, or whatever, if the consumption of cigarettes and tobacco is seen to go dramatically up, he would still leave this Bill on the statute book. If he is saying that, I suggest that he is very, very wrong.
Lord Hunt of Kings Heath: My earnest hope is that that will not happen and that the Bill, if enacted, along with the various other efforts we are all making to try to reduce tobacco consumption, will be effective. All I am saying is that I am confident that this Bill is one plank in efforts being made to reduce tobacco consumption. The evidence we have available suggests that we are going in the right direction; it is strong enough for the House to feel safe and secure in passing the Bill.
Baroness Jay of Paddington: Will my noble friend give way? To pick up the point made by the noble Lord, Lord Skelmersdale, it seems to me that if you have a time-limited Bill on this kind of activity, there are methods by which the tobacco companies could exploit it. I am not in any way attributing cynical policies to them but, for example, they could, in the run-up to the review of a sunset clause of the kind suggested by the noble Lord, lower the price of cigarettes to such an extent that it counteracted any health education or health promotion methods being used across the hoard. That would introduce, even temporarily, a rise in consumption. Although this could occur after the Bill had been passed—the point made by the noble Lord—my noble friend would be right in saying that any such provision should obviously be ignored.
Lord Skelmersdale: Surely it will take some time for the effect to be noticed and recorded. During that time, any responsible Government would increase the taxes on cigarettes and tobacco.
3.30 p.m.
Lord Hunt of Kings Heath: It does not seem to me to detract from the substantive point; namely, that the Government believe that the evidence is sufficiently robust to enable them to recommend to the House that it should support the Bill.
Lord Skelmersdale: The noble Lord is arguing from the wrong position. No one is arguing that the Bill should not be placed on the statute book. What we are
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talking about is under what circumstances it should continue to be on the statute book. I am merely saying that there is doubt—as indeed there is.
Baroness O'Cathain: If something dramatic occurred—for example, if someone said that smoking was good for people—then perhaps the Government of the day would introduce another Bill. I do not think for one moment that the idea of including a sunset clause, just because the Bill might result in more people smoking, is the correct approach.
As the Minister rightly says, the Bill contains a raft of measures. I do not know the figures, but I do not believe that smoking has increased over the past 10 years or so. I know that that has been the case in certain areas; but there is now hardly any place where people can smoke. That is bound to have reduced consumption. Perhaps we shall all come to our senses and realise how appalling smoking is in terms of its effect on our health.
Lord Hunt of Kings Heath: I understand that the noble Lord, Lord Skelmersdale, has a doubt. I do not share it. But, even if I did, I am not sure that I should conclude that a sunset clause is warranted given the scale of seriousness against which sunset clauses are used in legislation. However, I suspect that we are not going to agree on that.
Perhaps I should turn to Amendment No. 93. My honourable friend Ms Yvette Cooper published a regulatory impact assessment in December 2000 in connection with the earlier government Bill. This carried out, as far as possible, an assessment of the effects of the Bill on employment. It pointed out that there would be various effects, as is patently obvious, as a result of the likely fall in tobacco consumption. It pointed out, however, that if consumers spent less on tobacco they might spend more on other consumer goods; therefore, although there might be a reduction in the employment opportunities in the tobacco manufacturing industry, that might be compensated for in additional employment opportunities in other parts of the employment sector. It is also worth making the point that there has been a long-term fall in employment in the industry, due as much to automation as to falling demand.
I want to assure my noble friend that, of course, the Government are sensitive to the concerns of employees in the tobacco industry. One would have to be. They recognise that the industry provides skilled, well-paid jobs and that it has a significant impact on the local economy in a number of areas. I hope that I can assure my noble friend that the Government will keep a careful eye on this in terms of what support can be given to workers who are so affected. I am not unmindful of the impact on individuals, and have a great deal of sympathy with them. But, as my noble friend Lord Peston, said, at the end of the day we believe that the public interest is strongly in favour of the Bill and a reduction in consumption.
Lord Clement-Jones: We have had an interesting debate. The Minister put it very well when he said that he had no doubt. I share that lack of doubt. Even where there is a doubt, because of the public health interest we should legislate in these matters and not have a sunset clause. That is a fair statement, in the light of Amendments Nos. 89 and 90.
The noble Lord, Lord Peston, and the noble Baronesses, Lady Finlay and Lady Jay, have told us all about the problems of research that would fit the criteria set out in Amendment No. 89. That is fraught with difficulties relating to timing, changes in behaviour and the fact that there are other factors. Nobody has ever denied that other factors affect tobacco consumption, including price and peer group pressure.
The noble Baroness, Lady Noakes, talked about seeking after truth. I am among that number. We want to see the evidence after a few years of the operation of the Bill in the proper way, but the evidence pro tem is pretty overwhelming. I do not accept the points made by those who cast doubt on the evidence. I shall not repeat what the noble Lord, Lord Hunt, said, but many speakers at Second Reading went through the evidence exhaustively, particularly that from Scandinavia and New Zealand, but also that from many other areas. I hope that that tracking will take place.
Of course, the situation is complicated by the fact that there are other measures. This is only one part of a total package. As several noble Lords, particularly the noble Baroness, Lady Jay, pointed out, a range of other measures are being taken to reduce tobacco consumption. That complicates the matter.
I have great sympathy with the points raised by the noble Baroness, Lady Gibson. I very much welcome what the Minister said on that subject. Of course we regret any loss of employment, but one must be realistic. If we are banning advertising and we intend to lower consumption of tobacco products, there will be an inevitable reduction in employment, unless there is a simultaneous and regrettable export surge. The proper way forward is to look for alternative forms of employment. The companies involved must take that on board.
I do not believe that a sunset clause is the proper way forward. I am the first to stand up on human rights matters, whether it is prevention of terrorism legislation or matters affecting individual liberty. Such measures should be extremely narrowly confined in their application and I favour including sunset clauses in such legislation if appropriate. However, as I said earlier, I do not believe that we are talking about matters of fundamental human rights and I do not believe that a sunset clause is appropriate. As the Minister said, sunset clauses are appropriate when the state takes exceptional powers that need restricting.
I am afraid that I am not sympathetic to Amendments Nos. 89 or 90. I am sympathetic in spirit with Amendment No. 93, but I am afraid that the Bill will have an inevitable impact on employment.
Baroness Noakes: We have had an interesting debate on the amendments. I thank my noble friend Lord Skelmersdale for his support on the sunset clause. The two of us are pretty lonely on the subject—so lonely that I might even think about taking up smoking again.
I am surprised at the opposition to a sunset clause. We are not seeking to oppose the Bill. A number of noble Lords have said that we have enough evidence to legislate. I am not opposing that plausible position. However, we do not know the effects of a tobacco ban on cigarette consumption, particularly among the young, in this country. The aim of the amendment was simply to find that out. It is modestly drafted, because it requires only that the Secretary of State should be satisfied that the Act has led to a reduction in tobacco consumption, in particular among the young. It does not seek to oppose the nature of the Bill but seeks after truth in this matter, after the event.
To back that up, I proposed that research be undertaken. A number of noble Lords have spoken of the difficulties of research. The noble Baroness, Lady Jay, talked about the way in which tobacco advertising fitted into a wider programme. I accept that. The noble Baroness, Lady Finlay, spoke about confounding variables—a new term which I shall use often. I understand what they say: that it is difficult to undertake this kind of research. But it is not impossible over the proposed timescale. I accept the point that timescales might be longer. However, it is possible to do the research. Why are we afraid to find out the position?
Lord Faulkner of Worcester: I am grateful to the noble Baroness for giving way. If she accepts the principle that the purpose underlying the legislation and so much else of our health education policy is to reduce the amount of tobacco consumption and if research were to prove that the Bill had not produced a big reduction in consumption, the logical conclusion would be to consider ways in which we can redouble our efforts and bring about a reduction by other means. It is surely not logical to throw away the one weapon which we already have in the armoury.
Baroness Noakes: The noble Lord misunderstands me. I have no problem about trying to reduce consumption. It is a wholly worthy aim. Many of the strands of policy to which the noble Baroness, Lady Jay, referred are important in achieving that aim. If a tobacco ban is seen by evidence to be ineffective that does not lead me to say logically that I want to throw it away. If a tobacco ban is not effective, since it restricts companies carrying out their lawful business in this country, I would want to remove it. But, equally, I would want to redouble, treble or quadruple efforts to reduce by other policies tobacco consumption. I focus on this single policy. If that policy is not effective, it should not be on the statute book.
Lord Peston: Is the noble Baroness not interested in logic? My noble friend Lady Jay made a decisive point. I put it as simply as I can. Why are we engaged in the health education business if at the same time the tobacco companies are spending millions more than we are spending and both are regarded as legitimate activities? If we are in the health education business—very strongly we are—logically, it is entirely reasonable that we should say, "We do not want another group of people out there busily promoting the exact thing that we in the health business are saying is a bad thing". Is not there a logical point here? It is quite separate from everything else we are talking about.
Baroness Noakes: With the greatest respect to the noble Lord, Lord Peston, I do not think that it follows logically that one would want to ban tobacco advertising at the same time as doing other things. It is not proven that a tobacco advertising ban will lead to a reduction in consumption. If we were clear about that, there would not be a problem. If a ban on tobacco advertising had no impact, we should be neutral and allow advertising to continue.
I put this to the noble Lord, Lord Peston. Advertising could be aimed at increasing consumption—that is the position of most of the people who support the Bill—and therefore should be banned. That is not the same as a tobacco ban leading to a reduction in consumption. But tobacco advertising could also be aimed—as the tobacco companies maintain—at increasing their market share within the market which exists. They are competing among each other for smokers who have already decided to smoke. They are not policies, in this day and
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age, designed at increasing consumption but to increase market share. That is what research might wish to find out.
Baroness O'Cathain: I thank my noble friend for giving way. One cannot prove that tobacco advertising is solely to increase market share. Even if one could prove that, within that market share there would be new, young smokers because older smokers may be dead from emphysema and lung cancer, and goodness knows what else, or have given up. I know many older smokers who have given up smoking after 30 or 40 years. The reality is that one cannot say that because tobacco advertising is done in this way it increases only market share. That has been a spurious argument all along.
Baroness Noakes: I am grateful, I think, to my noble friend. I continue to have a naïve belief that research in this area would enlighten us all as to what the effect of a ban on tobacco advertising in this country might be. Given the time, I shall not labour the point further but I shall not rule out returning to this matter at Report stage. I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
[Amendment No. 90 not moved.]
Clause 20 [Interpretation]:
[Amendments Nos. 91 and 92 not moved.]
Clause 20 agreed to.
Clause 21 [Commencement, short title and extent]:
[Amendment No. 93 not moved.]
Clause 21 agreed to.
House resumed: Bill reported with amendments.
House adjourned at thirteen minutes before four O'clock

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