Sitting of 20 April 2004

Preamble
The House met at half-past Eleven o'clock
PRAYERS
[MR. SPEAKER in the Chair]
Oral Answers to Questions
  TRANSPORT
  The Secretary of State was asked—
  TRANSPORT

    Rural Transport
    Nick Harvey: If he will make a statement on the relationship between transport provision and access to public services in rural areas. [166169]
    The Minister of State, Department for Transport (Dr. Kim Howells): Good transport is important in improving access to public services in rural areas. We recognised that in targeting additional investment to improve accessibility for rural communities. We have invested £240 million in rural transport in the last three years alone, a 54 per cent. increase on the previous three years.
    Nick Harvey: Obviously new investment is welcome, but is the Minister aware that those improvements arise from a very low base? In my constituency, bus services to our hospital have been cut, and although we have welcome new sport and theatre facilities, using them in the evenings is an unimaginable dream for many youngsters because bus services stop at 6 pm. What impact does the Minister expect the forthcoming School Transport Bill to have on public transport provision in rural areas, which is already sparse? It raises the spectre of more children having to pay to travel to school by bus, which will inevitably drive more of them into the car run.
    Dr. Howells: I accept what the hon. Gentleman says. We must encourage people to use buses much more. What worries me is that, although large amounts are being spent on bus subsidies in rural areas, few people use the buses. I know that several initiatives have been launched in the hon. Gentleman's constituency—a 1999 initiative called, I believe, Buses Are Cool, followed by Life in the Bus Lane and Life in the Bus Lane 2. A great deal of money is being spent on efforts to encourage young people in particular to get to the places mentioned by the hon. Gentleman, but there is much more work to be done. Local authorities have a responsibility to publicise the fact that they are investing
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    in bus services, especially in rural areas. If there were more publicity and we could generate a better image for buses, many more people might use them.
    David Taylor: Following the disasters of deregulation and privatisation, this Government's progress since 1997 has been commendable; but for a small extra amount—just £300 million per year—standards could be raised, and the free bus travel for pensioners that is available in other countries of the United Kingdom could be extended to England. Is my hon. Friend confident that we can make progress in that respect, and also raise the minimum standard of the scheme by eliminating rush-hour exemptions? That would enable pensioners in Castle Donington, for instance, to keep appointments at Derby Royal infirmary without having to wait until 9.30 am.
    Dr. Howells: I am sure that my hon. Friend is on top of that quandary for pensioners in his constituency, and can work with local authorities to ensure that proper bus services are provided. The money has not been in short supply. The £300 million that my hon. Friend mentioned is not an inconsiderable sum; it is a very large sum. We are spending huge amounts on bus subsidies, but they are not always used to best effect. There must be a better way of getting value for precious taxpayers' money.

    Railways
    Mr. John Grogan: What representations he has received from Network Rail about the future organisation of the railways. [166170]
    The Secretary of State for Transport (Mr. Alistair Darling): In the course of the rail review, my Department has received representations from a wide range of people in the rail industry, including representatives of Network Rail.
    Mr. Grogan: Given the Government's commendable view that what matters is what works, why not leave the franchise in the hands of South Eastern Trains, which has improved punctuality dramatically since the demise of Connex? To secure two public sector comparators, why not make a similar arrangement for the northern franchise area?
    Mr. Darling: While I am always the first to welcome an improvement in performance, I must tell my hon. Friend that the performance of South Eastern Trains has improved by almost the same amount as that of the other south-east operators. It does not necessarily follow that the fact that the Strategic Rail Authority is currently running the franchise has led to the improvement; it is also due to Network Rail's improved performance.
    During the review I have made it clear that I consider the principle of both public and private participation in the industry to be important and beneficial. Apart from anything else, the private sector brings in almost as much money as the public sector. Although Connex was undoubtedly a supreme example of a bad franchisee, there are many good private sector operators, and some

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    are an awful lot better than British Rail was. It is not necessarily the case that the private sector is bad and the public sector is good.
    Pete Wishart: To assist in the debate about the future organisation of the railways, is the Secretary of State in a position to tell us more about what powers he intends to devolve to the Scottish Executive and other regional bodies? Is he impressed with the contribution of the Federation of Small Businesses in Scotland—it has enjoyed great consensus—which has suggested that perhaps the solution to the Scottish railway problem is to devolve all powers to the Scottish Executive?
    Mr. Darling: I suppose that it follows from the hon. Gentleman's philosophy that, as he does not like England, he would not want railway lines going beyond the border. If he thinks about the logic, let us suppose that Scotland were responsible for all mainline track. Correspondingly, the English attitude to upgrading track in England would be to stop investment at Newcastle and probably at Preston, because it would not be worth going beyond that. The fact is that we have a national railway network, and Scotland benefits from that. For example, when the east coast main line collapsed at Dolphinstone outside Edinburgh three or four years ago, Network Rail was able to step in and do something about that immediately, because although the sums needed were large, they were not for Network Rail. I reject the idea of balkanising Britain's railways, although I understand that that is entirely in tune with the nationalist philosophy.
    In relation to devolving further powers to the Scottish Executive, we are considering that as part of the review. I made that clear on 19 January, and we are continuing to discuss with the Scottish Executive and others how we do that. We are also discussing that in relation to the Welsh Assembly and some of the English passenger transport executives.
    Mr. Graham Stringer: I would not want to balkanise the railway system in any sense. I am sure however, that my right hon. Friend is aware that about £750 million is spent on rail in Greater Manchester. The vast proportion of that money is for local rail services not national rail services. Would it not be sensible, in any future reorganisation, if the proportion of money that is for local services were handed over to the passenger transport executive, so that it could make rational choices to improve the rail system, and rational choices between heavy and light rail and the bus system to provide a better integrated transport system in Greater Manchester.
    > Mr. Darling: I have a lot of sympathy with what my hon. Friend says. I see that a small part of the recent Transport Committee report on the railways suggested that we should do just that. As I said in my statement on 19 January, one of the things that I want to consider is being able to give more responsibility to PTEs to choose between, say, rail, light rail and bus services. There are far too many areas in which people regard rail as a free good, and they do not make sensible choices between other modes of transport. As I said a moment or two ago, in reply to the hon. Member for North Tayside
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    (Pete Wishart), devolving power, not just to Scotland and Wales but to the English PTEs, is an important element, because when looking at Britain's railways, it does not follow automatically that heavy rail is the solution for local transport. Indeed, Greater Manchester, with its metro system, is a very good example of an alternative to heavy rail having been highly successful.
    Mrs. Theresa May: The Secretary of State has just confirmed the importance of private sector investment in improving the railways. He has said in the past that the train operating companies have brought innovation to services, which was lacking. Will he now confirm that his future reorganisation of the railways will maintain the access to the fare box that has enabled train operating companies to compete and innovate in the interests of passengers?
    Mr. Darling: It is important that the right incentives and rewards exist to enable private operators to be confident in investing in the railways and to get a proper return for doing that. As the hon. Lady will know, the whole point of the review is to look at all the options and to make sure that proper incentives and rewards exist. Let us be in no doubt: I am determined that we should maintain the present system in which there is substantial private sector involvement in the railways, as the railways as a whole will be better for that. What is lacking at the moment, however, is a coherent system of management to enable the railways to be run properly, which the review will also set out to achieve.
    Mrs. May: The current system of management of the railways is the one that this Government set up when they established Network Rail and the Strategic Rail Authority. Following the reorganisation that led to Network Rail, the Government announced a series of performance benchmarks for improvements on the railways. Will the Secretary of State confirm that the key benchmark of improving punctuality and reliability has been missed in eight out of the last 10 quarters, and that with reduced services, such as stations closing in Kent, longer journeys for commuters from Maidenhead and Twyford, and cuts in cross-country services, passengers are beginning to ask whether the Government are capable of delivering any improvement on the railways? Is not the spirit of Dr. Beeching alive and well in the Department for Transport?
    Mr. Darling: We must admire the hon. Lady's brass neck, if nothing else. There is probably limited value in going back over old ground about who is to blame for what. [HON. MEMBERS: "Go on."] All right; just for one moment. I remind her that Network Rail was set up because Railtrack, the creature of privatisation, was an abysmal failure. Virtually no one in the country remains in that small and select band, the friends of Railtrack, but she is one of them. As she ought to know, performance is gradually improving across the network. She mentioned cross-country trains and was critical of the decision to thin the services. As a result of that service thinning, reliability has gone up dramatically. The problem was—[Interruption.] I will tell the hon. Lady what was happening. Railtrack oversold the space on the railways, with the result that they became

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    congested and timetables became unreliable. That was a direct result of privatisation and the failure to have a coherent management. If the hon. Lady wants to go into the next election defending the privatisation of the 1990s, let her. For our part, we will go into the election with a reorganised railway which makes sense and which works. I remind her that, last year, Britain's railways carried more passengers than at any time since the 1960s.
    Several hon. Members rose—
    Mr. Speaker: Order. May I gently remind the House that I have an Order Paper to get through and I could do with some help? We are on question No. 2 and it is a quarter to 12.
    Mr. Tony Clarke: In his future discussions with Network Rail, will my right hon. Friend raise the plight of Northampton commuters and make sure that promises made by rail operating companies when they come looking for public expenditure are kept post-expenditure? Ten years ago, trains from Northampton to London took less than an hour. We have now had 10 years of disruption. The west coast main line is still not finished and the rail operating companies are promising us longer train journeys and fewer trains. When will Northampton get more fast trains and shorter journeys? When will the promises made by operating companies be kept?
    Mr. Darling: I am aware of the problems and, in view of your instruction, Mr. Speaker, I shall be brief. I shall get my hon. Friend the Minister of State to write to my hon. Friend about that issue.
    Chris Grayling: Which rail projects outlined in the 10-year plan he expects will not be completed by the end of the 10-year period. [166171]
    The Secretary of State for Transport (Mr. Alistair Darling): The plan set out investment for both the public and private sector over 10 years and substantial progress is being made. Delivery of projects depends on a number of factors including controlling costs and improving performance.
    Chris Grayling: The Transport 2010 document is a work of fiction in many parts. At its launch, the Deputy Prime Minister said that it presented an ambitious vision of what we could achieve by 2010. Has the Secretary of State seen the map on page 48 of the new rail projects to be opened by 2010, on which virtually no work has even started and there is certainly little chance, if any, of them being completed by 2010? Does he now regret the promises made by the Government? What does he plan to do to ensure that some of the projects are completed any time soon?
    Mr. Darling: One way of ensuring that these projects are delivered is not to have a Conservative Government, who would be committed to £600 million of cuts in railway expenditure. Let me give two examples from the map to which he refers. One is the channel tunnel rail link, the first high-speed railway line to be built in this
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    country for 100 years. The first phase is now open and there are more passengers going between London and the continent. Another example is the west coast main line, a project that was in complete ruins under Railtrack, the friends of the hon. Member for Maidenhead (Mrs. May). It is now having £7 billion spent on it and most of the first stage of the work will be completed this year. It will take half an hour off the Manchester run and, when completed, will take nearly an hour off the Glasgow run. Those are two good examples of what investment in the railways can bring under a Labour Government.
    Dr. Alan Whitehead: Does my right hon. Friend continue to endorse the importance that the 10-year transport plan places on the role of major ports as transport hubs, and as vital to our international trade? Does he continue to endorse the improvement of rail freight use to those ports as a key element of freight strategy? In the light of the decision, announced by the Government this morning, on the future of Dibden bay and the expansion of Southampton port, will he give additional priority to the upgrading of the rail link between Southampton and the west midlands to ensure that Southampton freight can travel efficiently on the rail from the port to its destinations?
    Mr. Darling: Yes, it is important that we improve rail links between our ports and other parts of the country. I understand the disappointment that my hon. Friend will have felt at the decision on Dibden bay, but I am sure that he will accept, in the light of the inspector's report and the overwhelming environmental difficulties there, that the Government's decision is right. I say to him and to the House that that decision was made on the individual application. There are other applications for port developments in other parts of the country, on which the Government will decide in due course. The decision on Dibden bay was taken entirely on the application's own merits, and those alone.
    Dr. Julian Lewis: As the MP who represents Dibden bay, I welcome the contribution of the hon. Member for Southampton, Test (Dr. Whitehead). It is only a pity that the Government did not think about upgrading the railways in that connection from the outset. I congratulate the Government on their decision on Dibden bay, in a classic case of David outwitting Goliath. We thank the Government for listening to our community, for observing the environmental safeguards and for taking the right decision today.
    Mr. Darling: I am sure that the hon. Gentleman will tell his constituents of the many gains that a Labour Government have brought to them, of which this is, apparently, one. On the hon. Gentleman's point, protecting our environment is crucial, but most Members accept that it is also important to ensure that we have adequate port development throughout the country. Where that port development is situated will depend on a range of circumstances, many of which are being considered in inquiries that are currently under way, or are about to get under way. As I said, that particular decision was taken on its own merits, and one cannot read anything wider into it.

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    On the more general point, the hon. Gentleman is quite right to say that rail links between ports and other parts of the country are important. I am pleased to say that the railways are carrying more freight than they have done for a long time, which perhaps indicates the success of investing in railways.
    Jonathan Shaw: I welcome the Strategic Rail Authority's decision that the channel tunnel rail link domestic service will stop in the Medway towns, but does my right hon. Friend understand my concerns, and those of my hon. Friends in the Medway towns, at the SRA's proposals to reduce the number of fast services to Victoria and to reduce services to Cannon Street? If the Thames gateway is to meet all our ambitions, we must have increased rail capacity. Will my right hon. Friend talk to the Office of the Deputy Prime Minister and the SRA to ensure that there is joined-up government between the SRA, the ODPM and the Department for Transport so that we get the rail services in Medway that we need for the future?
    Mr. Darling: I am aware of the continuing debate and controversy on the Kent services, and we must come up with a solution that is workable as well as affordable. The consultation is still under way, but I am very aware of the points that my hon. Friend makes.
    Mr. Paul Marsden: Can the Secretary of State explain why the safety radio system, GSM-R—Global System for Mobile Communications for Railway—has been delayed for a second time? It is vital for signallers and drivers. Will he assure the House that that delay will not affect safety or reliability, given that from 2006 the existing system will be prone to interference from other users using the same frequency?
    Mr. Darling: Network Rail is injecting a dose of reality into the project that the hon. Gentleman mentions. Far too many rail projects that were got up during the last few years when Railtrack was around were totally unrealistic in terms of feasibility, affordability and deliverability. The project is being examined closely to ensure that it is realistically planned and has a better chance of being delivered.
    On safety, I remind the hon. Gentleman and the House that the train protection warning system is now fitted on all the track where it is supposed to be fitted, so drivers have communication. I am satisfied that the effort that Network Rail has put in has been right and has not compromised safety. We spend a lot of time and money ensuring that our railways are as safe as they can be, and the TPWS has gone a long way towards achieving that.

    Severn Bridge Tolls
    Mr. Huw Edwards: How many motorists are registered to pay tolls on the Severn bridge by the tag method. [166172]
    The Parliamentary Under-Secretary of State for Transport (Mr. David Jamieson): The tag system is operated by the bridge operators, Severn River Crossing
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    plc. I understand from them that as of 29 February 2004 a total of 38,893 tags were in use. In February 2004, 22 per cent. of all crossings and 68 per cent. of heavy goods vehicle crossings used that system.
    Mr. Edwards: Does my hon. Friend appreciate the concerns of my constituents who, since the opening of the new bridge, find that the old Severn bridge is used largely for local traffic, and find it irritating to have to pay £4.60 to get back to town when they have travelled only a couple of miles to the east of where they live in Chepstow? Will he consider introducing a better discount system to serve the residents of Chepstow and other parts of Monmouthshire, and perhaps others who live near the bridge?
    Mr. Jamieson: I understand the importance of this to my hon. Friend's constituents, and why he would call for a concession for local residents, but if that was imposed by the Government, the operators would almost certainly want to re-finance the deal, which would push back the estimated date of 2016 for the removal of the toll. Those who buy a monthly tag and use the bridge more than 18 times already receive some concession. Any other form of concession would put a considerable burden on the public purse. Perhaps he would like to raise the issue with the Welsh Assembly Government, but I can tell him that there is no easy or low-cost solution.
    Mr. Simon Thomas(PC): Surely that last point is part of the answer. The Richards report has recently come out in Wales, and further devolution to the National Assembly is likely. Surely the future for both Severn crossings is now part of an overall package of road pricing for the whole of the motorway network in south Wales, and it would be better to transfer the responsibilities over a period from the Minister's Department to the National Assembly, to better reflect the views of local residents and the national needs of Wales.
    Mr. Jamieson: We cannot now unpick the Act of Parliament that set up the two bridges. The hon. Gentleman's constituents may not be experiencing the same problems as the constituents of my hon. Friend the Member for Monmouth (Mr. Edwards) but perhaps they can join forces to see whether the Welsh Assembly Government can find a solution, or whether the operators themselves can come up with something. We would be happy to assist in that, but I repeat that there is no easy or low-cost solution.
    Mr. Ken Purchase: Just up the road from the Severn bridge, although it is early days, we have a very successful toll road round the eastern side of our west midlands conurbation. In view of that success, which has eased congestion on the M6, linking to the M5 to the Severn bridge, may I urge the Minister to revisit his consideration of the orbital road around the western side of the west midlands conurbation, especially in relation to tolling?
    Mr. Jamieson: First, I congratulate my hon. Friend on his ingenuity in getting in that question in this

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    context. I recognise the success of the M6 toll—I have used it myself—which considerably reduces journey times north and south around the north of Birmingham, and I am sure that his points will be given careful consideration.

    Speed Cameras
    Bob Russell: If he will estimate how many (a) lives will be saved and (b) serious injuries will be prevented in the next 12 months as a result of the installation of speed safety cameras. [166173]
    The Parliamentary Under-Secretary of State for Transport (Mr. David Jamieson): The independently produced evaluation report of the two-year trial of the safety camera cost recovery scheme showed a 35 per cent. reduction in the number of those killed or seriously injured at camera sites. A report covering the third year of the programme's operation is due to be published shortly.
    Bob Russell: I am grateful for the Minister's encouraging response. Will he confirm that by the end of today—as of any other day in the year—it is likely that about 10 people will have been killed and scores of people seriously injured on our roads? Against that background, can he understand the logic of those who encourage law-breaking? How many deaths are those people prepared to tolerate? Should they not be made to visit some of the families of people who have lost their lives because of excessive speed?
    Mr. Jamieson: The hon. Gentleman makes a very salient point. Last year's report on the eight pilot areas showed a reduction of about 500 collisions in those areas alone. Many of those collisions would have led to death or serious injury. Since cameras have been fitted throughout the country, we have seen a dramatic fall, particularly in death and injury to children, which is most significant. There has been a 35 per cent. reduction in three years. I agree that the people calling for the cameras to be removed—we may hear from the hon. Member for Ashford (Mr. Green) in a few moments—should reflect on the consequences of their policy and assess how many additional deaths of children and elderly people are likely to follow from it.
    Mr. Bill Olner: I welcome the Minister's announcement about the reduction in the number of road injuries and deaths. Those who campaign for the removal of cameras should have on their conscience the consequences for the victims of road traffic accidents. However, I implore the Minister to look further into the issue of speed cameras on motorways. I agree that those cameras are effective when men are working on the motorways, but for long stretches and huge amounts of time there are no roadworks. With modern-day telematics, surely there could be variable speed limits for various parts of the day.
    Mr. Jamieson: My hon. Friend is absolutely right to say that people calling for the removal of the cameras should also answer the question of how many more casualties will result at those sites. He will know that
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    there are very few speed cameras on motorways, which are the safest roads in the country. The few areas where cameras are placed permanently are usually where there has been a record of serious injury or death or where there are roadworks. The figures show that in 18 months, 11 people working on the roads were killed. As I said earlier, I hope that we hear from the hon. Member for Ashford today. Regular attenders of Transport questions will know that we have still not heard about the 4,000 sites that he alleged had cameras in the wrong places. Perhaps we will hear from him some time today.
    Mr. Patrick McLoughlin: Do lorry drivers from foreign countries who are caught on speed cameras have to pay the fine?
    Mr. Jamieson: That is indeed a problem. In association with our colleagues in the EU, we are looking into the problem of tracking down foreign drivers for the payment of fines. The issue of fines and other penalties across the Union is a matter of concern and we are also worried about the number of foreign vehicles in this country that may not be taxed or insured.

    M1 Multi-modal Study
    Dr. Nick Palmer: If he will make a statement on action he plans as a result of the M1 multi-modal study.[166174]
    The Parliamentary Under-Secretary of State for Transport (Mr. Tony McNulty): Last week, we announced that we were putting a £1.9 billion scheme to widen the M1 in the east midlands into the targeted programme of improvements. That will now be taken forward by the Highways Agency. Work to progress other elements of the study's recommendations is being co-ordinated at various stages within the region.
    Dr. Palmer: Together with Broxtowe borough council, I am concerned that the multi-modal study is being cherry picked and that we are seeing a celebration of the roads programme with insufficient progress made on other elements. I am sure that my hon. Friend would agree that the point of a multi-modal study is to integrate the different modes of transport. Will he assure the House that the other elements of the proposals will be taken with equal seriousness?
    Mr. McNulty: I can tell my hon. Friend that, together with various stakeholders and key players in the region, we are progressing as much as we can on all elements of the multi-modal study across the piece, whether it be public transport, road or other elements. I can understand the frustration about the time involved in the process: in some cases it means local authorities making bids for the local transport plan—in conjunction or separately. We are seriously considering the outcome of this and other multi-modal studies across the piece, incorporating public transport as well as road elements.
    Mr. Damian Green: The Minister will know that drivers on the M1, especially in the west and east midlands, will want the multi-modal study to lead to easier, smoother driving on the motorway. In

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    that regard, may I congratulate him and his ministerial colleagues on hinting to selected media that they propose to adopt the Conservative proposal for an 80 mph maximum speed limit on the M1 and other motorways? Can he confirm that he has stolen that very good policy, and may I assure him that we have many more good policies—on speed cameras, uninsured drivers and road humps—that he would be well advised to steal as well?
    Mr. McNulty: The hon. Gentleman might find that he would have more integrity in the House if he had risen during the last question and answered the points made by my fellow Under-Secretary about his previous little wheeze for endorsing those who would break the law on speed cameras. Many, many motorists will welcome what we have already announced in the programme of almost £2 billion for the M1, as they will welcome much of what we have done, in a concentrated and focused roads programme, for further improvements to the M1.
    We take very seriously all suggestions for policies, however bonkers they may be, and we shall put those of the Conservative party into the mix, too. I encourage the hon. Gentleman to pursue his transport policies, because the more he talks about a clear transport policy for the Tories, the more he ensures that he will remain on the Opposition Benches for a long, long time.

    Railway Stations
    Mr. Archie Norman: What plans he has to increase investment in railway stations. [166175]
    The Minister of State, Department for Transport (Dr. Kim Howells): Considerable investment has already been allocated to station improvement by the Strategic Rail Authority, Network Rail and, indeed, the train operating companies, but any proposal to increase investment in railway stations over the coming years will be subject to the availability of future funding, following the Government's spending review later this year.
    Mr. Norman: Does the Minister recall that in successive answers to parliamentary questions, Ministers have reassured Members that resources would be made available and steps taken to ensure that stations meet the requirements of the Disability Discrimination Act 1995? Yet throughout the country, stations such as mine in Tunbridge Wells remain completely non-compliant, no resources have been forthcoming and neither Network Rail nor the train operating companies will take responsibility. In this day and age, does the Minister think it acceptable that disabled people have to make an appointment to be carried down stairs or through tunnels so that they can catch a train and, if not, what does he plan to do about it?
    Dr. Howells: The hon. Gentleman is right: there should not be a system whereby people have to book help to get down stairs. I understand from South Eastern Trains that all stations in the hon. Gentleman's constituency have access problems; that the company has conducted an audit to identify what is required to ensure compliance with the DDA; and that the information has been passed to the SRA. I can also tell
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    him that the SRA is considering how best to prioritise the programme of works to ensure that all stations and train services meet the accessibility requirements of the Act; the implementation works will be subject to the availability of funding.
    However, I understand from South Eastern Trains that stations in the hon. Gentleman's constituency are due for the general tidy-up—repainting, cleaning of graffiti and so on—that they certainly require. Furthermore, on taking over responsibility for the franchise, SET found that there was 20 per cent. shortage of staff, so the company has undertaken a recruitment exercise and expects to be fully staffed by August. I shall certainly follow up the specific cases that the hon. Gentlemen raised about access to and from platforms, but I hope that he will welcome the fact that we have an indication that there could be a general improvement in the state of those stations.
    David Cairns: Through my hon. Friend the Minister, may I thank the Secretary of State for his staunch support for the regeneration of Gourock station in my constituency? Is it not the case that when a station is redeveloped, it can have a very beneficial knock-on effect on the regeneration of the surrounding area? That would certainly be the case in Gourock, where major benefits would flow. To that end, can my hon. Friend ensure that his Department continues to support the regeneration of the station and encourages Network Rail Scotland to spend the money that has already been allocated in its budget wisely, as part of a partnership to ensure the broadest possible regeneration for Gourock when the station is developed?
    Dr. Howells: I can give my hon. Friend the reassurance that my right hon. Friend the Secretary of State is in discussions about that issue at the moment.
    Mr. John Horam: What are the Government's intentions towards investment in London Bridge station? As the Minister and his colleagues will be aware, that station is a huge bottleneck for trains coming in from south-east London and Kent, a fact which has led, among other things, to the Strategic Rail Authority's absolutely disastrous proposals in the integrated Kent franchise to cut peak-hour trains from south-east London. For example, Petts Wood trains are being cut by about a half at peak times and trains from Chelsfield to London termini by about two thirds. Does he not think that it is much better to invest relatively small amounts in increasing capacity at such stations, rather than cutting services, which inevitably leads to even more overcrowding?
    Dr. Howells: I understand that London Bridge is Britain's busiest railway station, and if we could sort out the problems there, it would increase capacity of services in the south-east a great deal, as the hon. Gentleman suggests. However, that is not an inexpensive project—it could be very expensive—and it has been bedevilled by planning problems, such as the future of Borough Road market. The pinch point that the hon. Gentleman mentions runs directly over the roof of the market. Those engineering problems are not easy to sort out, but I have visited the area twice recently and I understand

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    that there are now some feasible engineering solutions to those problems that could well allow us to build at least another track there, which would do a great deal to increase the capacity of the lines in and out of London Bridge station. The hon. Gentleman is right to point out that that is one of the key projects on the British rail network, and it will probably offer very good value for money if we can find a way to solve the list of complex issues that bedevil the regeneration of that station.
    Mr. Barry Sheerman: Does my hon. Friend agree that the best investment that we could possibly make in stations is to stop them being unmanned or unpersoned? I have seen newly painted stations where the graffiti has been wiped out and the stations have been cleaned up, but the graffiti starts to appear again the next day because the stations are unpersoned or unmanned. We will not get accessibility—[Interruption.] I am making a very serious point; I do not know why the Minister finds it amusing. The fact is that people have access to railway lines. Given what they put on railway lines, if they have free access 24 hours a day, with little surveillance, it will lead to another serious accident on the railways. I believe that unmanned stations will lead to accidents, and my hon. Friend should take that seriously.
    Dr. Howells: I assure my hon. Friend that I take it very seriously. I was smiling in sympathy at his struggling with a number of phrases, such as "unmanned" and "unstaffed" and so on.
    We are very concerned about the fact that people should feel safe and secure at stations, and the best way to do that is to ensure that staff are present to meet the train when it arrives and to make sure that everyone is on the train safely when it leaves. Unfortunately, of course, there are a great many stations where the number of people passing through is very small—a tiny number—and it is not economically possible to ensure that there are staff at such places 24 hours a day.
    We have safe station schemes—I visited one in Hereford recently—whereby, without much money being spent, a guarantee is given that staff will be present to meet trains and to see people off on them, and the performance and the state of the station are improved very dramatically. My hon. Friend makes a very important point, but we must be careful to hedge it by pointing out that such things cannot happen at every station and halt in this country.

    Travelling Costs
    Norman Baker: If he will make a statement on the relative changes in the cost of travelling by (a) car, (b) train and (c) bus since 1997. [166176]
    The Parliamentary Under-Secretary of State for Transport (Mr. Tony McNulty): Between 1997 and 2003, the real-terms cost of travelling by car fell by 4.8 per cent., the cost of travelling by train rose by 3.0 per cent. and the cost of travelling by bus rose by 8.2 per cent.
    Norman Baker: Are not those figures an admission of failure in Government transport policy—not only undermining the Government's social inclusion agenda, but encouraging a modal shift from buses and trains to
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    cars? What practical steps—I emphasise the word "practical"—other than hand wringing will the Government take to encourage a real cut in the fares charged by public transport operators? In particular, will the Minister consider the example in my constituency, where South Central, at my request, has cut season ticket fares between Eastbourne and Lewes and Seaford and Lewes by a third, which has led to a 35 per cent. increase in season ticket sales and a 30 per cent. increase in passenger traffic? Is not that the sort of example that he should be championing?
    Mr. McNulty: I suppose that one should not be shocked by the typical mischievous Liberal distortion of statistics. Those figures far more readily reflect the decrease in the overall cost of motoring than the increases in fares. Whether to make deals on fares is entirely up to the franchisees in any area. Significant improvements in bus services throughout the country are plugged in directly to the social inclusion agenda. The hon. Gentleman knows that, overwhelmingly, the 10-year plan and the new review of it are rooted in an integrated transport programme with public transport at its core. However, I look forward to seeing punitively high taxation on motorists in the Liberals' next shadow Budget, which is the inexorable logic of the hon. Gentleman's posturing.
    Mr. Michael Jabez Foster: Does my hon. Friend agree that the secret is to get more people on the buses, and that the easiest way in which to do that would be to give free transport to pensioners countrywide? That would be good for the environment and for pensioners, and it would reduce bus losses.
    Mr. McNulty: My hon. Friend knows that since 1997, because of what the Labour Government have done rather than posturing, pensioners throughout the country experience at least half fares. We have examined and will continue to examine, among other things, the cost of going further than that, but it is only because of what the Labour Government have done since 1997 that pensioners are now in a far better position in terms of public transport than they were under the previous, miserable Administration.
    Sir Nicholas Winterton: Will the Minister deal with my question seriously, because it is genuinely of great concern to my constituency? Bus companies have dramatically increased the cost of the provision of services to Cheshire county council, which seeks to subsidise rural and other routes. As a result, and because of capping and the other problems facing councils, there has been a substantial reduction in the number of routes for which the council has been able to provide a subsidy. I am concerned that the bus companies have increased costs—the charges—by between 35 and 50 per cent. Will he look into the matter?
    Mr. McNulty: I shall of course look at the case in some detail, and if the hon. Gentleman wants to discuss it, I shall be more than happy to meet him. I have two further things to say to him. First, I answer every question seriously. Secondly, if behind his question is a hint that there should be significantly higher public subsidies for buses, especially in shire areas, he should

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    have a word with his Front Benchers about how that would fit in with a £600 million cut in transport provision, should the Conservatives ever get near the Government Dispatch Box.

    Uninsured Drivers
    Chris Bryant: What estimate he has made of the average number of uninsured drivers on the road on any one day in the past 12 months. [166177]
    The Parliamentary Under-Secretary of State for Transport (Mr. David Jamieson): My Department takes the problem of uninsured driving seriously. The insurance industry estimates that about 5 per cent. of motorists drive without insurance. The Association of Chief Police Officers of England, Wales and Northern Ireland recently conducted a survey, checking vehicles across the United Kingdom. The results of that survey are being collated and we will study them most carefully.
    Chris Bryant: Bearing in mind the significant number of uninsured drivers and the appalling expense and inconvenience caused to those who are involved in accidents with such drivers, is it not time that we considered having a joint tax and insurance disc—or at least ensuring that when someone buys a disc for six or 12 months, they can prove that they are insured for the whole period, not just for the day they go into the post office?
    Mr. Jamieson: I note my hon. Friend's interest in this important matter, which he is right to raise. I assure him that I think that uninsured motorists are a menace on our roads. We have not discounted the use of insurance discs on windows, but we have asked Professor David Greenaway to conduct a full inquiry into uninsured driving and we expect his report shortly. We shall examine the recommendations and implement them rapidly. We want tough measures to be taken against those who are clearly flouting the law.
    Mr. Greg Knight: Does the Minister agree that the problem affects us all, as every motorist pays for uninsured drivers through higher insurance premiums? Transport Ministers have been showing a modicum of common sense recently. We suggested the introduction of a statutory code for traffic wardens—Ministers adopted Conservative policy. We suggested looking at higher speed limits on motorways—Ministers are now looking into that Conservative policy. Will the Minister complete the hat trick and adopt Conservative policy on uninsured drivers by giving courts the power to confiscate the vehicles of repeat offenders?
    Mr. Jamieson: One thing we will not be learning from is the Opposition's transport policy. While we concentrate on safety, they wallow in opportunism. The right hon. Gentleman was quite right, however, that uninsured drivers are a menace, and there is a cost to everyone in our insurance policies and in terms of safety on the road. We will look carefully at Professor Greenaway's report—I hope that he and his party will do so as well, and support the measures that we introduce in the House.

  CABINET OFFICE
  The Minister was asked—
  CABINET OFFICE

    Civil Servants
    Mr. Peter Luff: What recent guidance he has provided to Ministers on the public identification of civil servants they believe are responsible for mistakes made by or within their Department. [166189]
    The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Mr. Douglas Alexander): Ministers are accountable to Parliament for the decisions and actions of their Department. That is clearly set out in the ministerial code and a resolution of the House carried on 19 March 1997.
    Mr. Luff: Has not the Government's treatment of civil servants in general been utterly shameful? Special advisers are given powers over civil servants in the burying of bad news; the Lord Chancellor is held to be in contempt of Parliament for his treatment of a civil servant; and recently a Home Office Minister blamed an individual in her private office for policy errors for which she should have carried responsibility. If the Government are to squeeze an extra Bill into the legislative timetable, should it not be a long overdue Civil Service Bill, not a Bill to ban hunting?
    Mr. Alexander: I am intrigued by the Opposition's legislative priorities, as I have previously noted that a Bill that won the support of the Opposition included a provision for executive powers for special advisers retained under that measure. That said, the Government have introduced a code on special advisers and brought unprecedented transparency to their work in government, so we will take no lessons from the Opposition.
    Paddy Tipping: When drafting the Civil Service Bill, will the Minister look at opportunities to deal with this serious problem, which affects not just individual civil servants but the trade unions as well? Will he confirm that he meets civil service trade unions to discuss those issues?
    Mr. Alexander: I assure my hon. Friend that I meet regularly with the Council of Civil Service Unions. The Public Administration Committee published its own draft Civil Service Bill on 5 January, and my officials are currently preparing a draft Government Bill.
    Mr. Oliver Heald: The Minister holds that it is not important to protect the civil service and define the relationships between civil servants, political appointees and Ministers, but that is not what he said in January, when we called for a Civil

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    Service Bill. He promised one then, just as Labour have done every year since 1997, but in the three months since, the Lord Chancellor has been found guilty of contempt of Parliament for his treatment of a civil servant. What a disgrace. On top of that, we have a Home Office Minister—
    Mr. Speaker: Order. I call the Minister.
    Mr. Alexander: Thank you, Mr. Speaker. I shall try to rescue the Opposition spokesman from the difficulties in which he finds himself. The Conservatives had 18 years in which to introduce a Civil Service Bill, but did not take the opportunity to do so in any of those legislative Sessions. We gave a commitment in January in the House, and we will honour it.
    Mr. Bob Blizzard: Is it not the case that if something goes wrong in an organisation it will want to know exactly what happened and who was at fault? With the civil service, however, when the issue comes to public notice, the media's thirst for news makes it inevitable that the identity of civil servants who prove to be at fault will come out. Should we not reflect that reality in a new Civil Service Bill?
    Mr. Alexander: I will bear in mind my hon. Friend's comments in relation to the work that is under way on the Civil Service Bill. As regards some of the specific cases in the news in recent months, there is little that I can usefully add at this stage.
    Norman Baker: Is not the question whether civil servants make mistakes sometimes difficult to establish because of the confusion over the role of special advisers? Can the Minister explain, for a start, why Jonathan Powell should have the right to issue orders to civil servants? Would it not also be helpful if there were a process for identifying publicly the mistakes made by special advisers, such as some of the rubbish put forward by Lord Birt?
    Mr. Alexander: The basis on which power is exercised in Downing street by Mr. Jonathan Powell was made clear in the Order in Council when Labour came to power in 1997. As I said, it is significant that the Conservatives chose to support a draft Bill earlier this year that maintained the power of two executive positions in Downing street for a future Administration. Nevertheless, I shall bear his comments in mind.

    Home Computing Initiative
    David Hamilton: What assessment he has made of how the recently launched home computing initiative will help to reduce the digital divide. [166190]
    The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Mr. Douglas Alexander): Employer-provided home computing initiatives make owning a computer more accessible for many people.
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    Such schemes reduce the costs of acquiring a computer by up to 40 per cent., drive up levels of internet access and use, and improve IT skills as a result.
    David Hamilton: My hon. Friend is well aware that I represent a former mining area. Although I welcome the fact that we are down to 2.5 per cent. unemployment in the area, that camouflages a large number of people who have been long-term sick and long-term unemployed. What access will those people have? What can we do to give them free or low-cost digital access? Is any help available for that?
    Mr. Alexander: My hon. Friend makes an important point. From his work in Midlothian I know of his keenness to tackle long-term unemployment. I know he shares with me pride in the fact that almost 1.75 million more jobs have been created since 1997. On the specific point that he raises concerning internet access in Midlothian, I shall be happy to take the matter up with the Scottish Executive Minister.

    Broadband
    Mr. Michael Connarty: What assessment he has made of the impact of broadband access on the Government's delivery of its e-Government strategy. [166191]
    The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Mr. Douglas Alexander): The UK currently has the third most competitive and extensive broadband network in the G7. Broadband can drive higher take-up of e-government services, as broadband users are around twice as likely to transact online than their narrowband counterparts. Broadband also offers the potential to deliver new and more sophisticated public services, which is why we as a Government are investing more than £1 billion in the period from 2003 to 2006.
    Mr. Connarty rose—
    Mr. Speaker: Order. The noise level in the Chamber is far too high, and that is unfair.
    Mr. Connarty: Thank you, Mr. Speaker. Broadband access is an important topic. If everyone is to have access to the Government's e-agenda, everyone needs to be on broadband, because that is the future of the technology. I note that the Chancellor said that there were rules against state aid, which prevent the development of the market. Is it not time that the Government considered a commitment to 100 per cent. access to broadband in all parts of the UK, and challenged the European Union if it tries to prevent appropriate state aid being made available to brine that about?
    Mr. Alexander: I know of my hon. Friend's concern about the matter and his tireless work on behalf of his constituents. It is worth pointing out for the sake of perspective that there are 40,000 new connections to broadband taking place each week. At the end of February 2004, research revealed that the UK had reached an estimated 3,523,350 broadband customers.

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    That is tremendous progress. I shall bear my hon. Friend's comments in mind and pass them on to the Chancellor in due course.
    Mr. Robert Key: Broadband access in rural areas is essential. It is a lifesaver for hard-smitten rural economies, and the Government are not moving fast enough in that regard. For example, can the Minister explain why, when it comes to the delivery of e-local government services, there are no grants available for parish councils and town councils?
    Mr. Alexander: The hon. Gentleman is no doubt aware that there is the £30 million UK broadband fund, which is taking forward that work. I find it intriguing, to say the least, that a party that seems to support a reduction in the funding for the Department of Trade and Industry is simultaneously pleading for more money for broadband in its members' constituencies.

    Departmental Procurement
    Andrew Selous: What the Cabinet Office policy is on buying British goods. [166192]
    The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Mr. Douglas Alexander): In line with Government policy, my Department bases all procurement decisions on value for money. Information on nationality of companies is recorded only for contracts subject to EU advertising procedures. During 1999–2002 eight such contracts were advertised, of which seven were awarded to British suppliers.
    Andrew Selous rose—[Interruption.]
    Mr. Speaker: Order. Once again, the Chamber must be quiet to allow the question to continue.
    Andrew Selous: There are unemployed motor workers in my constituency following the closure of the Vauxhall plant. Will the Minister explain why 80 per cent. of ministerial cars an not made in Britain?
    Mr. Alexander: The United Kingdom produces more cars than ever before. Procurement laws apply not only to this Government but to all previous Governments, which explains our decisions.

Europe
12.30 pm
The Prime Minister (Mr. Tony Blair): With permission, Mr. Speaker, I will make a statement on the forthcoming negotiation over the new European treaty. In parallel, the Foreign Secretary is today publishing a White Paper on Europe.
On 1 May, the European Union will enlarge from 15 to 25 members, which will be the biggest increase in Europe's size and will reunify Europe after the travails of Communist dictatorship in eastern and central Europe. It is an historic event that this British Government, and the previous Government, have championed. Whatever problems it poses—we see them in the anxiety over prospective immigration—let us be in no doubt that the prospect of EU membership, together with the courage of the Governments concerned, is the primary reason why those countries have been able to reform their economies and politics so radically and so beneficially, and such change is in the interests of all of Europe. I say unhesitatingly that enlargement is right for Europe and for Britain, and that this country should support it.
In addition, Bulgaria and Romania are set for membership in future years, taking the numbers to 27. Turkey is now taking extraordinary strides on democracy, human rights, economic change and the resolution of the conflict in Cyprus, which would have been unimaginable just a few years ago, under the impulsion of future EU membership. Within the space of a few years, Europe will be transformed, and it will be easily the strongest political union and greatest economic market in the world. Britain should be at the heart of it. That is its right and its destiny.
Because of enlargement, Europe is sensibly seeking to change the way it works. In a Europe of 25, 27 or 28, a rotating six-month presidency makes no sense. The use of the veto should be confined to the areas in which it is truly necessary; otherwise, decision making becomes paralysed. In certain areas—terrorism, security, economic reform and the environment—Europe must do more and do it better.
The new constitutional treaty is designed both to answer the challenge of enlargement and to bring together in one treaty what is currently found in two separate treaties. Indeed, a significant part of the new treaty is the repetition of articles that are already in force. I want to make it clear that Britain will co-operate fully in helping Europe to work better, but to work better as a Europe of sovereign nation states. Maintenance of control of our affairs is essential in certain areas of policy. The national veto must remain in areas such as taxation, foreign policy, defence, social security, how the essentials of our common law and criminal justice system work, and treaty change, and we will insist on the necessary amendments to the current draft treaty to ensure beyond doubt that it does. On that basis, the treaty does not and will not alter the fundamental nature of the relationship between member states and the European Union.
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After ratification by all member states, the new treaty will probably take effect in 2007, with certain key provisions taking effect in 2009. Until then, the key provisions of the Nice treaty will remain in place. If the new treaty contains those essentials, we believe that it is in Britain's interest to sign it. It will replace the six-month rotating presidency with a full-time chairman of the Council—a vital step away from federalism—enabling the Council, which is, of course, the repository of individual European Governments, to become the body that sets Europe's agenda. For the first time, the new treaty will allow national Parliaments the right to object to Commission proposals for legislation, which is a big advance in subsidiarity. It adds a greater ability to co-operate on areas such as terrorism and cross-border crime which are crucial for the world in which we live, and it gives a bigger role for enhanced co-operation between some of the member states, where not all of them wish to participate in certain areas.
That is what the treaty, if amended in the way that we seek, will actually do. Ever since its inception, however, the myths propagated about it have multiplied in those quarters, political and media, which we know to be hostile not just to this treaty, but to the whole notion of Britain playing a central role in Europe. For example, that the EU will be renamed the "United States of Europe". No, it will not. It is to remain the European Union. [Interruption.]
Mr. Speaker: Order. Her Majesty's Opposition wanted this statement to be made. It does no good to shout down the Prime Minister. I will not tolerate it.
The Prime Minister: That the Queen will be replaced as our head of state by an EU President of the Council. In fact, we already have a President of the Council, and always have had. Or that Britain will be forced to join the euro, without a referendum and regardless of the economic tests being passed. No, it will not. The existing agreements on the single currency remain in the new treaty. That Britain—this was said by the Opposition—[HON. MEMBERS: "No!"] Yes, it was. That Britain could not mount a future Falklands war or Iraq campaign without permission from Brussels. Yes, we could. Defence is to remain unanimous and the prerogative of the nation state. Or that we will lose our seat on the UN Security Council. No such provision exists. Or that Brussels will seize control of our oil supplies. No, it will not, and the treaty will make that clear. Or that Brussels will have the power to set taxes in Britain. Taxation is to remain with the nation state.
Or—another myth from the Opposition—that our foreign policy will now be decided by the EU because the new treaty obliges member states to support Europe's common foreign and security policy
"in a spirit of loyalty and mutual solidarity".
I quote from the draft treaty. Actually, those words are taken from the Maastricht treaty; and in any event, common foreign and security policy is decided unanimously. Or—another myth from the Opposition—that we will surrender control over our borders. It is already agreed that our right to control our borders—secured by this Government in 1997—will be specifically retained in the new treaty. That the assumption of innocent until proven guilty in British law will be scrapped. No such provision exists.

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All those, and many others, such as the hardy perennials about being forced to drive on the right, the Germans taking over our nuclear weapons; and, no doubt, the shape of our bananas, too. Even yesterday, the right hon. and learned Gentleman the Leader of the Opposition asserted that if this treaty were in place, I would be unable as British Prime Minister to go to Washington to talk to President Bush. I know that that might recommend itself to some of my colleagues on the Labour Benches, but it happens to be untrue.
It is all nonsense—myth designed to distance people's understanding of what Europe is truly about and loosen this country's belief in its place in Europe. It has been an unrelenting, but, I have to accept, at least partly successful campaign to persuade Britain that Europe is a conspiracy aimed at us, rather than a partnership designed for us and others to pursue our national interest properly in a modern, interdependent world.
It is right to confront this campaign head on. Provided that the treaty embodies the essential British positions, we shall agree to it as a Government. Once agreed—either at the June Council, which is our preference, or subsequently—Parliament should debate it in detail and decide upon it. Then, let the people have the final say. The electorate
"should be asked for their opinion when all our questions have been answered, when all the details are known, when the legislation has been finally tempered and scrutinised in the House, and when Parliament has debated and decided."—[Official Report, 21 May 1997; Vol. 294, c. 735.]
If Conservative Members object to that, it is a quote from the right hon. and learned Gentleman the Leader of the Opposition, speaking about referendums in 1997.
The question will be on the treaty, but the implications go far wider—as I believe we all know. It is time to resolve once and for all whether this country, Britain, wants to be at the centre and heart of European decision making or not; time to decide whether our destiny lies as a leading partner and ally of Europe or on its margins. Let the Eurosceptics, whose true agenda we will expose, make their case. Let those of us who believe in Britain in Europe—not because of Europe alone, but because we believe in Britain and our national interest lying in Europe—make our case, too. Let the issue be put and let the battle be joined.
Mr. Michael Howard: I begin by welcoming the fact that the Prime Minister has, at long last, seen sense and decided to give the British people their say on a question of such fundamental importance, even though he could not bring himself to utter the word "referendum" in his statement this afternoon.
Six months ago, the Prime Minister stood before his party conference and said, with all the lip-quivering intensity for which he has become famous:
"I can only go one way. I've not got a reverse gear."
Today, we could hear the gears grinding as he came before us, lip quivering once again, to eat all those words that he has pronounced so emphatically for so long. Who will ever trust him again?
Last May, the right hon. Gentleman told us all:
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"We do not need a referendum on whatever constitution comes out of the intergovernmental conference."—[Official Report, 21 May 2003; Vol. 405, c. 1004.]
Last July, he said:
"A referendum would be a gross and irresponsible betrayal of the true British national interest".
Only last Saturday, he was insisting on the radio:
"Our policy hasn't changed."
Perhaps he will tell us this afternoon when exactly it changed. Sunday? Monday? Have we all missed something, or was there a secret weekend Cabinet meeting to agree the change in policy? Was the Minister for Europe speaking for the Government when he told the House only last month that the Government would never
"surrender itself to the populist plebiscites of the Rothermere press"?—[Official Report, 30 March 2004; Vol. 419, c. 1530.]
Clearly, no one told him that the policy was likely to change.
No one told the 319 Labour Members, who all dutifully trooped through the Lobby only three weeks ago to vote against a referendum. They not only voted against it but wrote letters to their constituents, explaining why it would be wrong for Britain. I shall make them an offer: if they want help to explain to their constituents why a referendum is right for Britain, the Conservative research department will be only too happy to assist. There they all sit—having been marched up to the top of the hill only three weeks ago to oppose a referendum and marched down again today—the loyal foot soldiers of the Grand Old Duke of Spin.
Now that popular opinion and parliamentary pressure have forced the Prime Minister to eat so many of his words, let him answer the fundamental questions. First, why has he changed his mind? There was not a word of explanation in his statement. Is it because he knows that he is hurtling towards defeat in the European elections in June? Is it because he knows that he cannot win the argument in the next general election? Perhaps he will tell the House whether his change of heart is a product of principle or a decision based purely on opportunism.
The Prime Minister will remember telling us time and again, "I don't believe it's necessary to hold a referendum unless there's a fundamental change in the nature of the relationship between the member states and the European Union." According to the statement, he apparently continues to believe that there is no fundamental change. Does he now therefore believe that a tidying-up exercise justifies a referendum? That, of course, is not how others see it. The Belgian Prime Minister called the constitution the "capstone" of a "federal state", and the German Foreign Minister says that it is
"the most important treaty since the formation of the European Economic Community",
Why does the Prime Minister not recognise what is obvious to everyone else?
Why has the Prime Minister changed his mind about the timing of a referendum? After all, as recently as 26 March he was telling reporters in Brussels:
"The sooner we do this, the better",
and that a "speedy resolution" would "safeguard Britain's interests".

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If the Prime Minister wanted a speedy resolution to safeguard Britain's interests on 26 March, why does he not want one today? The Government will have our full support for the speedy passage of the legislation necessary to hold a referendum, but there is no case whatever for asking Parliament to spend months on ratification legislation before obtaining the consent of the British people. [Interruption.] After all, it was this Prime Minister who held referendums for the Scottish Parliament and the Welsh Assembly before this Parliament had passed the necessary legislation. He did it, and while at that time many of the details remained unclear, on this constitution all the details will be clear. That is the difference: we shall know what they are. How can the Prime Minister say, "Trust the people—but not just yet"?
The Prime Minister has suggested today that the debate on this constitution is in reality about whether we stay in or out of the European Union. He knows that that is a complete misrepresentation of the facts. Will he now confirm that, in order for the constitution to be adopted, every country must agree to it? It is open to any country in the European Union to reject it, and if any country does so, the constitution will be dead. He knows that that is the position; everyone knows it. That is no doubt why the Foreign Secretary said that the constitution was "not … essential".
Will the Prime Minister confirm, once and for all, that Britain or any other country can reject the constitution and remain a full member of the European Union? If Ireland or Denmark vote no, they will remain in the European Union, and if Britain votes no, we will remain in the European Union.
So let us have no more of this nonsense. Let us have the honest debate about Europe that the Prime Minister says that he wants, not a debate about the Aunt Sallies that his statement was full of, or about bananas or driving on the right. Let us have a debate about the real issues that are relevant to the future of Europe. The European Union has achieved a great deal. Together, we have created a single market of 380 million people. But the European Union is failing to face up to the realities of the 21st century, and the constitution will make that failure worse. It will mean greater centralisation, more regulation and less flexibility. It is the exact opposite of what Europe really needs. Far from solving its problems, it will create more.
Conservatives have an alternative vision for Europe. We want a Europe that is flexible. If some countries want to integrate more closely, that is fine, as long as they do not force other countries to follow them if they do not want to do so. Our policy is simple: live and let live. That is a modern and mature approach that will allow Europe to succeed in the 21st century. It is a far better approach than the centralising, top-down constitution to which this Government are wedded, and which we will continue vigorously to oppose.
The Prime Minister: The right hon. and learned Gentleman went on so long about the U-turn that I got the impression that he did not really like it. When he
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talks about changing one's mind on a referendum, I suppose it is rather like him and the Maastricht treaty, is it not?
Mr. Howard indicated dissent.
The Prime Minister: Did he not vote against a referendum on the Maastricht treaty? I rather think so. I thought I remembered that he did. So I am afraid that I am not the only one who can change his mind.
The biggest change that the right hon. and learned Gentleman indicated today, however, was on the view that we should not have a parliamentary debate in the House on the detail of what is a 300-page document, before the people have their say. This is what the right hon. and learned Gentleman said when we were debating Scottish and Welsh referendums:
"A pre-legislative referendum is designed to pre-empt parliamentary debate. It is not a new device. The device was the hallmark of continental dictatorships between the wars. European tyrants used the plebiscite to sideline their Parliaments; they used it to suppress the rights and liberties of their citizens."—[Official Report, 21 May 1997; Vol. 294, c. 736.]
That is what the right hon. and learned Gentleman said. I have listened to him: he should be congratulating me.
The right hon. and learned Gentleman says it is a myth that he said yesterday that it would be not me but the president of Europe who would visit the President of the United States, but it is indeed what he said. He said:
"if … the constitution were in force, the president of Europe, not the British Prime Minister, would have met the President of the United States".—[Official Report, 19 April 2004; Vol. 420, c. 25.]
That is exactly what he said. [HON. MEMBERS: "Read on."] I will read the whole paragraph. Does the right hon. and learned Gentleman want me to? Yes.
"Given that the Prime Minister is always eager to secure the maximum possible agreement in the European Union on such issues, will he confirm that, if such agreement existed and the constitution were in force, the president of Europe, not the British Prime Minister, would have met the President of the United States last week?"—[Official Report, 19 April 2004; Vol. 420, c. 25.]
It does not get any better on a second reading.
These are the myths. In fact, if anything convinced me of the case for a genuine debate in Parliament and then in the country, it was the fact that not once in his response to me did the right hon. and learned Gentleman get down to the details of the constitution. There is a very simple reason for that. He is not against a particular provision of the constitution; he is against it in its entirety. Exactly: the Conservatives nod.
The right hon. and learned Gentleman's position is not that we should amend this phrase, this clause or that article in the constitutional treaty, but that we should get rid of the whole thing. [Interruption.] "Quite right," they say.
Let us just follow that through. This is why the debate will be quite interesting when it is under way. Not one of the 24 other Governments in the European Union agrees with that position: not one. The right hon. and learned Gentleman would have to convince all of them that they should change their position, because any

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treaty change must be agreed unanimously by the Council. In other words, if the right hon. and learned Gentleman wants the whole of Europe to agree to abandon the constitution completely, he will find himself saying either, "We will veto the whole constitution", or "You go ahead as 24 on this basis, without us".
Mr. Howard indicated dissent.
The Prime Minister: I am afraid the right hon. and learned Gentleman is wrong. That is precisely what the European Union would want to do in those circumstances—which is precisely why the case put by his right hon. Friend the Member for Wells (Mr. Heathcoat-Amory), who represented the Conservative party on the Convention, is that we should bring about a situation in which Britain is against the whole constitution and then, as he said, move to a form of associate membership.
Mr. Howard indicated dissent.
The Prime Minister: That is the position of the Conservative party. That is where the right hon. and learned Gentleman will end up, because no one will support his attempt to renegotiate the conditions.
As the debate continues, it will become very clear what the choice is. Either we have Britain at the heart and the centre of Europe, able to play its full part in the European Union, or we end up opting to go down the road set out by the Eurosceptics who now dominate the Conservative party, and fundamentally change the relationship that Britain has with the European Union. That is what is at issue—whether Britain continues at the centre of European decision making, as we passionately believe it should, or we retreat to the margins, where we were when the right hon. and learned Gentleman's party was last in power.
The right hon. and learned Gentleman has already said, for example, that he wants to opt back out of the social chapter—has he not? [Interruption.] That is exactly what he said. And what would that mean? It would mean British workers once more being the only workers anywhere in the European Union without the right to paid holidays.
Mr. Howard indicated dissent.
The Prime Minister: Yes, it would mean exactly that. In 1997 they did not have the right to paid holidays, did they? The Conservative party was against it, and against the social chapter.
That is the debate that we shall have over the coming months. I simply say to the House and the country that it is a debate that everyone who believes in Britain's true destiny in Europe will view with enthusiasm.
Mr. Charles Kennedy: We certainly welcome the Prime Minister's confirmation today that in due course there will be a referendum of the British people on the proposed European constitution. We welcome that, whatever the
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ultimate motives that led the Prime Minister to his overdue decision. I can only express the hope, at the outset, that the co-ordination of a European referendum campaign will be a bit more slick and polished than the co-ordination that led to today's announcement in the House of Commons.
Does the Prime Minister agree that when the referendum comes it must be based on an unloaded, unbiased question which will be subject to confirmation by the Electoral Commission, and that it is best decided after due parliamentary consideration? Does he agree, or at least acknowledge, that one of the subtexts of the dispute, or debate, about timing in which he is now engaged is that—while the other European member states have their own processes, which mirror or will act in parallel with ours, and that is obviously outwith the Government's control—the timing of the next British general election is of course in the hands of the Prime Minister himself? The general election is the only race in the world in which a principal competitor also holds the starting pistol. When it comes to an issue as important as the timing of a referendum on a fundamental matter concerning Britain's role in Europe and the related timing of a general election—if ever there was a case for fixed-term Parliaments, this must surely be it.
It is clear from the exchanges so far that when the referendum comes it will set its own pace and develop its own character. Does the Prime Minister agree that, whatever the expressions of public support over the past year to 18 months, one thing that comes through loud and clear in every analysis of public opinion is that a great percentage of people repeatedly say that they want more unbiased, factual information on which to base their final conclusions about Europe? This campaign must represent the opportunity to provide that.
Does the Prime Minister also agree that, in one of the great missed opportunities of recent years, those of a Eurosceptical or Euro-hostile disposition have been allowed far too much of the running, and that therefore the more quickly the pro-European forces can co-ordinate and make a positive case based on the facts, the better it will be? Does the Prime Minister now propose to move quickly to re-establish a pro-European British campaign, drawn from all political parties and, indeed, from outside formal party politics itself? Does he acknowledge that if the referendum campaign, whenever it comes, were hatched, controlled and spun from No. 10 Downing street, that would not command the confidence or its participants and would not persuade the British public of the desired outcome?
Does the Prime Minister acknowledge that his negotiating position between now and June will be strengthened by today's announcement? Does he acknowledge that that applies particularly to his ability to guarantee the red lines—which, as he knows, we support—especially the maintenance of the national veto over matters concerning constitutional changes, defence, taxation, spending policies, social security and the like? Given his strengthened negotiating stance, will he, between now and June, push for further improvements in the treaty? Not least, will he stress that European Union action should be limited to specific objectives that make sense in the context of nation states, that there must be more enforcement of consistency in regard to EU rulings and laws across

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member states, and that there should be more decentralisation to local communities throughout Europe?
Finally, what discussions does the Prime Minister envisage will take place to decide what will be the umbrella organisation for a pro-European campaign to be registered with the Electoral Commission? Assuming that his Government are in power administering the proposed referendum, will he apply collective Cabinet responsibility or will he take the view of Harold Wilson in the 1970s that it can be suspended?
Surely this is an historic opportunity to settle at last an issue that has bedevilled two generations of British politics and each and every successive Government of whatever political persuasion across those generations. At the end of the day, it will come down, to use the phrase of the leader of the Conservative party, among those of us of all political persuasions where Britain's future engagement in Europe is concerned, to being between those who want to live and let live and those who will increasingly be exposed as wanting, where Britain's future in Europe is concerned, to live and then let die.
The Prime Minister: I can answer briefly on this. We are agreed on the basic position on the treaty and on the measures needed to secure further improvements in it. It is absolutely right that we engage in this debate in a way that allows people to debate the actual details of the treaty. I am sure that that is right. Obviously, the exact nature of any campaign can be decided later, and of course the position is a Government position. It is the Government's view that this treaty should be carried through, and I would expect that to be a Government position.
Mr. Jimmy Hood: I welcome the Prime Minister's statement, particularly his announcement that full and proper parliamentary scrutiny will be applied to the Bill before any referendum. Perhaps history has been made today, because never in my 17 years in the House—and I cannot remember any previous occasion either—has the Leader of Her Majesty's Opposition come to the Dispatch Box and argued against parliamentary scrutiny. It is a moment of history of which everyone should take notice.
In any publicity when we have the referendum debate, whether in White Papers or reports, may I suggest that we make an annexe of the situation before and after—the treaty as it is, and the treaty as it will be in future—so that we can have a proper debate? When Conservative Members criticise the changes in the draft treaty, they have a terrible habit of putting the blame as far back as the treaty of Rome.
The Prime Minister: What my hon. Friend says on these issues is absolutely right, particularly as he is Chairman of the European Scrutiny Committee. On issues of detail, given that the constitutional treaty is a 300-page document, it is surely right and better that the public have their say after an informed debate in the House in which we can thrash out some of these issues. I am happy to go back to some of the questions raised earlier, particularly about what the consequences would be if, say, we rejected in entirety the principle of the
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treaty. We can debate those issues here, and the country will then make its decision on an informed and better view.
Mr. David Heathcoat-Amory: Was not the Prime Minister's announcement today entirely consistent with the rest of his European policy, which is to give categorical and repeated assurances one way, followed by an ignominious retreat while pretending that everything is the same and that everybody has changed except him? Why does he continue to misquote and misrepresent deliberately my arguments in a pamphlet that I wrote last year? Is this to be the way he conducts the referendum when it is held? Will he give a straight answer to a straight question? If another member state—a small country—holds a vote and rejects a constitution before we hold a referendum, will he, assuming he is still the Prime Minister, go ahead with his promised referendum, or will he use that as an excuse to cancel the British national referendum, even though that other country may subsequently be bullied into changing its mind?
The Prime Minister: No, of course not. The referendum should go ahead in any event. [HON. MEMBERS: "Ah."] Of course it should. May I deal with the issue that I constantly misrepresent the right hon. Gentleman about associate membership? I assume that I have an accurate quote. This is what he wrote in his pamphlet on this issue:
"In practice, if a country voted no to the Constitution, the matter would eventually have to be resolved politically. The state concerned would probably allow the others to go ahead, having negotiated an associate membership of some kind".
That is why I keep saying that he is favour of that, and he is.
Mr. Heathcoat-Amory: I was not advocating it.
The Prime Minister: This is where the Conservative party is very tricky. It says, "We are not actually advocating it." Let me explain why that is the consequence of its position. If its position is not simply to oppose one aspect of the constitutional treaty but the whole treaty, the political reality—as it has made it clear that it will be running for a no vote in the referendum campaign—is that no matter what emerges from the negotiation, it will say no. Therefore, it would not go back to the European Council and say, "We think this or that should be changed." It would be coming back and saying, "The whole thing should be scrapped." I will tell Conservative Members, here and now, that the political reality, which is why the right hon. Gentleman wrote what he wrote, is that the rest of Europe would say, "I'm sorry, we are determined to have a constitutional treaty. You move to a different form of relationship with the European Union." That is why he wrote:
"The state concerned would probably allow the others to go ahead, having negotiated an associate membership of some kind".
That is exactly what he wants.
Mr. Frank Field: May I thank the Prime Minister on behalf of the majority of Labour voters, who have longed to hear him make the statement that he has made today? I congratulate him on resisting

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those pressures from colleagues who argued that at all costs he should not concede a referendum on the constitution of Europe. May I also ask him now to resist those same people who will be asking him to knock this issue into the long grass until after the next election? Does he appreciate that Labour voters will see all the difference between a promise that can be delivered before the next election and one that may be delivered after the next election? If the Opposition are genuine about letting the people decide, he may get his Bills on the constitution and the referendum through in such quick time that it would allow him to call the referendum before we vote in the general election.
The Prime Minister: I thank my right hon. Friend for his welcome for the statement. Even though we may be on different sides in relation to some aspects of the constitution, I am sure that he will conduct the debate in a sensible and reasoned way. The issue related to timing arises in this way: should the parliamentary debate come first or not? I happen to believe that this is a case par excellence of when it should come first, so that both Houses of Parliament debate it fully and properly, and the people then have the final say. That is the issue on timing, rather than other issues that must be decided at a different time.
Rev. Ian Paisley: Will the Prime Minister explain what is the difference between now and a few weeks ago when he was opposing a referendum? When did the change come? If this is a genuine conversion to the referendum, I applaud it. I would like to act as Ananias to him and say, "Welcome, Brother Tony, to the referendum supporters," as I believe that this nation should have a say. If it is an expedient U-turn, however, we find ourselves in great difficulty, in the country and the House. He owes the people of this country a solid explanation.
The Prime Minister: The position that I hold on the constitutional treaty is the same in terms of the details of that treaty. I believe the treaty to be right for Europe and right for Britain. I believe that the constitutional treaty is necessary if we are going to make the historic enlargement of the European Union work. I also believe that it does not alter fundamentally the nature of the relationship between the European Union and the member states. I would not agree to a treaty that put us on a path to a federal superstate. I will only agree to one that maintains the rights of sovereign independent states. I must accept that it is not merely that many people in this country want this matter decided finally in a referendum, but that, frankly, it is time to dispel the myths about Europe. The reason why I think people should have their say is not that I agree with the hon. Gentleman—I do not—but that the question of myth versus reality on Europe should finally be laid to rest.
Ms Gisela Stuart: I welcome my right hon. Friend's statement and urge him to ignore the laughter from the Opposition parties for the time being. Once they have to explain their policies, the laughter will disappear quickly. I urge him to have a referendum on the constitution only and not to take this
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opportunity also to have a referendum on the UK's remaining opt-outs. Will he confine the referendum to that subject?
The Prime Minister: My hon. Friend is absolutely right; the referendum should be on the constitutional treaty. That is what we should do, and once we have cleared away all the arguments about process, we can have a proper argument about the substance.
Mr. Ian Taylor: What is it about a referendum on a constitutional treaty that creates such chaos? The Liberal Democrats have called for one and are now gobsmacked that they have been offered it. Traditionally, my party has been against referendums but has suddenly decided that this one is a good thing. The Prime Minister has done a handstand so that the sun can shine out of part of his anatomy. A constitutional treaty is a complex document that needs to be debated and analysed by this House, and that should be the guidance to the public. Why has the Prime Minister suddenly changed his mind on such a fundamental principle of Westminster democracy?
The Prime Minister: The hon. Gentleman and I agree on the substance of most European issues. We agree on the importance of Britain playing its full role in Europe, on the need for this constitutional treaty and on making sure that it is adopted and seen through. But both of us must accept, as pro-Europeans, that the pro-European case has gone by default in many instances. People see that there is some choice or division between the British national interest and Britain's place in Europe. The reality is that when we get to the substance of the discussion of the constitutional treaty, we will be on strong ground. At the moment, the substance of the constitutional treaty is drowned out by the call that we are denying people a say because we are trying to conceal some terrible thing that the constitutional treaty is doing.
I have not changed my mind on the constitutional treaty, but it is the right moment for those of us—in the Conservative party, frankly, as well as on the Labour Benches—who believe passionately that Britain's place is at the centre of European decision making, particularly when Europe evolves into a European Union of 25, 27 and then 28, to make our case. We may believe, rightly, that parliamentary democracy is the normal way in which these things ought to be decided. Personally, I think that it is extraordinary that the Leader of the Opposition has said that Parliament should not debate this matter first. None the less, the hon. Gentleman and I must accept that if we are to make the case, we will have to take it out and make it to the British people.
Mr. Colin Challen: I congratulate my right hon. Friend on his statement and echo the comments of my hon. Friend the Member for Clydesdale (Mr. Hood), the chairman of the European Scrutiny Committee. Having read parts of the draft constitution, I can say that it is difficult to determine what was in previous treaties and what is new. I cite article 51—a minor issue on the recognition of religious organisations and so on—as an example, because there is an addition to article 51. The first thing that the Prime

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Minister should do is to convince the Opposition not to go into a referendum campaign opposing our membership of the EU. From today's debate, it is not at all clear that they want to stay in.
The Prime Minister: The truth is that a very large part of the Conservative party will not want to say that it is going to withdraw from the EU, but will want to provoke a crisis out of which we will have a choice, one that will be a stark one for this country. I am sure that the Leader of the Opposition would prefer not to be put in that position—he has some experience of government—but the truth, as he knows, is that, in a large part of the Conservative party, the centre of gravity has moved to an extreme Eurosceptic position. That is the case and, after all his remarks about U-turns are out of the way, he will have to confront that within his own party.
Mr. Richard Shepherd: I have never heard an initial statement of such transparent bluster. However, if the Prime Minister believes—as I do, profoundly—that it is a principled decision to have a referendum and not merely a question of tactical expediency, will he explain to the House and the country at large the principles by which he changed his view and is now having a referendum?
The Prime Minister: I explained that in answers to the Leader of the Liberal Democrats and to the hon. Member for Esher and Walton (Mr. Taylor). If we both agree that it is right that the people have the final say, let us get on and have the debate about the issue. It is extraordinary; I have done what the Conservative party clamoured for, month after month, but it is now terribly interested in skewering us on the reasons without getting to the substance of the issue. That is the most telling aspect of the debate.
Mr. Iain Luke: As a fervent believer in further European integration, I reluctantly accept the proposition that we need a referendum to dispel the distortions being put out by the Conservative party. But will the Prime Minister undertake today that, on the successful negotiation of such a treaty, the Government will wage an aggressive campaign for entry into the constitution based on Labour's commitment to the European ideal and on Labour's values of internationalism, and that the campaign itself will not seriously impede the move to a referendum on a common currency for Europe?
The Prime Minister: As my hon. Friend will understand, those are separate issues and we have set out our position on the single currency. However, he is right that we need to get across what the treaty does. The truth is that large numbers of people in this country think that, if we sign up to the draft constitutional treaty, we will give up our right to set our taxation rates, conduct our foreign and defence policy and do those things that a nation state should be able to do. That is simply untrue. I do not know of any country in Europe—especially not, incidentally, the new members coming into the EU, who have only, just escaped from the dictatorship of a supranational body—who want to do such a thing. The idea that I or the Prime Minister of
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the day will not be able to conduct our foreign policy as we would wish or set out own tax rates, or that our pension provisions will be determined by Brussels, simply are not true. That is why I agree with my hon. Friend. When people know that there is a referendum at the end of the parliamentary debate, public awareness and interest in it will be rather greater.
Mr. David Trimble: I congratulate the Prime Minister on his statement and on the decision, which—for whatever reason it was taken—is the right thing to do. Could I advise him not to get too dug in at this stage on when the referendum should be? There is still a lot to be sorted out yet. We do not know that there will be an agreement. In my view, it would have to be completely rewritten to be a satisfactory constitution. But if there is agreement, it is only right that one should proceed as quickly as possible to have the debate and a decision. The last thing the Prime Minister wants is to be seen to be trying to deny or delay the decision; the words of the right hon. Member for Birkenhead (Mr. Field) were wise on that. May I further advise him not to be too influenced by the rather foolish comments of the chairman of the Electoral Commission, if it should prove convenient to have the referendum on the same day as the general election?
The Prime Minister: On timing, the issue is whether the parliamentary debate precedes the referendum, which is the key thing for us. I agree with the right hon. Gentleman that we do not yet have the treaty; it is not yet agreed. There is a general assumption that the Polish and Spanish positions have completely changed since the previous negotiation. That may or may not be true about the Spanish position; I simply do not know. I rather doubt whether it is true, in quite the way people think, about the Polish position. Incidentally, it is not merely Britain that has concerns. Virtually every country around the table has concerns about the existing draft. There is still a lot of negotiating to get right, which is why it is sensible to set out a process at this stage, but I agree that the timetable is open.
Mr. Tam Dalyell: As the last of the 69 Labour Members who went into Ted Heath's Lobby to go into the Community and as a hardened veteran of the constitutional arguments that occupied 47 days on Scottish devolution in 1978–79, may I say gently to the Prime Minister that scrutinising temporary legislation is not a quick business? It guzzles up parliamentary time. Has he had a word with the Leader of the House and the Chief Whip on the crucial question of the time available and at what point the guillotine will be put in? Experience of recent devolution Bills has shown that, frankly, huge chunks were unscrutinised and, we now find, unsatisfactory.
The Prime Minister: There is no one in this House who has greater experience of constitutional debates than my hon. Friend, and I shall listen carefully to what he says. The main point is that we must be able to debate the details of the constitutional treaty properly, although I think that in the end that will fall around certain key provisions of the treaty. That will be essential. Let us be quite clear: neither the country nor Parliament will think that we should not sign up to the constitutional treaty on

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the basis that we have qualified majority voting on patents, on the rules of parts of the European Central Bank or on many of the other issues on which we are moving towards qualified majority voting. On the other hand, the House will want to be sure that, on the issues that I mentioned, such as taxation, foreign policy and defence, the rights of the nation state remain.
Mr. Edward Leigh: Will the Prime Minister confirm that the referendum will not be about Britain's membership of the European Union but about the constitution? Will he confirm that, if the British people were to say no, all that would happen would be a renegotiation, as happened when Denmark said no? Will he confirm that, under the existing treaties, no one could force us into associate membership and no one could proceed without unanimity? That is what the treaties say.
The Prime Minister: Of course the question should be on the constitutional treaty, but let me just say this to the hon. Gentleman. Ireland recently first voted against the Nice treaty, then came back to have a further referendum. Of course, it then came back and negotiated certain changes. That is wholly different from the position of the Conservative party, which wants to come back and say, "We are not going to have this treaty at all". That is the Conservative party's position. That is why there are two steps. I agree that the point of associate membership or withdrawal is not reached immediately, but I have to tell the Conservative party that if we were to come back and say that we would not have the treaty at all—not in any shape or form—the other countries around the table would not accept that. If I were in that position, I would not accept it.
Donald Anderson: My right hon. Friend made a powerful and convincing case over the past year that there was no need for a referendum, and there is every reason to think that by June, there will be something of a triumph of British diplomacy in that intergovernmentalism will be enshrined and our red lines maintained. He will not, therefore, be surprised if some of us ask what new and major factor has arisen. There are constants. In my judgment, there has not been a major change in the constituencies. The mythmongering of the newspaper magnates is as before and, even worse, the opportunism of the Opposition, who held no referendum on Maastricht or the Single European Act, is maintained. The so-called alternative vision, as my right hon. Friend has said, is not shared by any other country, and can only be a recipe for either withdrawal or isolation. What is new?
The Prime Minister: My right hon. Friend and I share the same position on Europe, and however much we disdain the position taken by the Conservative party and believe—as I do—that most of its members want to have a fundamentally different relationship with the European Union from our existing one, I am afraid that we must accept that the fact of the matter is that this argument is not yet won in the country. We must accept that. We should not alter in any way our view on
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Britain's place in Europe but, on the contrary, should be prepared to go out and fight for it. That is what we should do.
Mr. David Curry: Does the Prime Minister recall taunting a previous holder of his office with weakness over the management of his party and his Government in respect of Europe? Is he not in exactly the same position? Given the abandonment of everything that he has ever said about the constitution—always with characteristic biblical certainty—does not that description now rightly apply to him: "Weak, weak, weak"?
The Prime Minister: I have not altered my view on the constitutional treaty, its importance, its terms or our negotiating position on it. The right hon. Gentleman, again, is someone who shares my view on Europe, but unfortunately does not share the view on Europe of his Front Bench spokesmen and his party. As he knows, his party wants to take Britain in a fundamentally different direction in Europe. In the end, this is not a question of pressure in the party or anywhere else, but there is now a real desire among the public to debate this issue. As pro-Europeans, we have to accept that.
I have watched matters accumulate over a period of time, including the myths about Europe. When I read those myths out, members of the right hon. Gentleman's party say that of course they are all nonsense; but in fact, some of them are exactly what they have been saying. For example, when the shadow Chancellor stood for election, he said not merely that he was against the single currency, but that he wanted to repatriate powers from Brussels. If that is the case, that negotiation, which is not supported by anyone else in Europe, will have to be conducted. That is the nature of the argument that we now face and if we are serious about winning the argument, now is the time when we have to go out and make it to the public.
Mr. Ian Davidson: May I express my complete and enthusiastic support for Government policy on the referendum? I am sure that the Prime Minister will accept that as genuine, because I am not always as enthusiastic about every aspect of Government policy.
I particularly welcome the fact that the Government have been prepared to listen to the people. Will my right hon. Friend accept that many of us on the Labour Benches know that there is no merit in intransigence for its own sake and welcome the change? However, I ask him not to be too hasty in moving to the necessary debate and exploration of the measure, because it involves complex matters that need to be properly scrutinised. Will there be scope for any amendment or does he intend the measure to come before Parliament and the country entirely on a take-it-or-leave-it basis? Many of us want parts of the constitution to be amended, while we accept other parts thereof.
The Prime Minister: I welcome what my hon. Friend says about wanting to scrutinise this matter carefully in Parliament. That is the right thing to do. In respect of what Parliament can do, anything that we amend that goes to the heart of what is already in the treaty must be negotiated with people. However, it is right to say that

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we will have the fullest opportunity to debate the treaty, as we would any constitutional treaty, on the Floor of the House—and not just here, but in the other place.
Angus Robertson: As an historic European nation, Scotland and the Scots have always sought to play a significant role in our continent—but not at any cost. It is right and proper that voters north of the border will be able to cast their ballots on whether the constitution is in Scotland's and Europe's interests, but does the Prime Minister understand that it will be impossible to win a referendum in Scotland unless unacceptable provisions on key industries such as fishing and energy are radically amended?
The Prime Minister: Fishing, is still a shared competence, and we believe that that is right. In respect of energy, concerns have been put to us, but there is already agreement in principle to changes being made on energy to make the position clear. As far as I am aware, the changes have the agreement of the oil industry.

Northern Ireland (Independent Monitoring Commission)
1.28 pm
The Secretary of State for Northern Ireland (Mr. Paul Murphy): With permission, Mr. Speaker, I should like to make a statement about a report that I have received from the Independent Monitoring Commission concerning paramilitary activity in Northern Ireland.
Before I move to the substance of my statement, I should like to take this opportunity to condemn in the strongest terms yesterday's sending of suspect packages to two elected representatives in Northern Ireland, the hon. Member for Belfast, East (Mr. Robinson) and Mr. Alex Attwood. I am sure that the whole House will join me in those sentiments. Police investigations into those incidents are continuing.
As the House will recall, the Independent Monitoring Commission was set up by an international agreement, supported by legislation that we passed in this place last year. It is composed of four distinguished members: John Grieve, former assistant commissioner of the Metropolitan police and Lord Alderdice, formerly presiding officer of the Northern Ireland Assembly, who were both nominated by the British Government; Mr. Joseph Brosnan, formerly secretary of the Irish Department of Justice, who was nominated by the Irish Government; and Mr. Dick Kerr, formerly deputy director of central intelligence in the United States, who was nominated by the US Administration.
Last Wednesday, the British and Irish Governments received the commission's first report. I am today laying it before the House as I am required to do by law. Copies will be available in the Vote Office at the conclusion of my statement.
The report is concerned with the continuing activities of paramilitary groups in Northern Ireland. The commission had originally expected to produce it in the early summer, but at the request of the Governments, it has brought forward its production. At the request of the Governments, in the context of its wider analysis, the report also specifically addresses the incident at Kelly's Cellars, Belfast, on 20 February 2004. That event, as the House will recall, caused profound controversy in Northern Ireland, which has in turn disrupted the conduct of the review of the operation of the Good Friday agreement that began earlier this year.
We are most grateful to the commission for advancing its report, which has clearly involved a great deal of work by all concerned. Notwithstanding the pressures of time, I believe that it has produced a very thorough and far-reaching report. Both Governments accept the commission's conclusions and recommendations.
The commission states that the situation is now much better than it was in past years, but it finds that paramilitary activity is at a disturbingly high level on the part of both republican and loyalist groups. I quote from the report:
"On the basis of reported figures—which, especially for assaults, may not reflect the full picture—the scale of paramilitary violence since 1 January 2003 has been worryingly high: approaching one murder a month; some three victims a week both from shootings and from assaults."

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It goes on to state that two parties represented in the Assembly, Sinn Fein and the Progressive Unionist party, have links with paramilitary groups. It is clear from the report that senior politicians are in a position to exercise significant influence over their activities.
The commission also expresses its belief that the incident in Belfast on 20 February was the responsibility of the Provisional IRA. It urges elected politicians in Northern Ireland to commit themselves to supporting the rule of law and the criminal justice institutions and says that, in the absence of a sitting Northern Ireland Assembly, it is not possible for it to make recommendations on measures that the Assembly itself might consider taking in response to its report. However, it makes it clear that
"had the Assembly now been functioning, we would have recommended in respect of Sinn Fein and the Progressive Unionist Party measures up to and possibly including exclusion from office."
In the absence of a sitting Assembly, however, it recommends that I
"should consider taking action in respect of the salary of Assembly members and/or the funding of Assembly parties, so as to impose an appropriate financial measure in respect of Sinn Fein and the Progressive Unionist Party."
When we debated the legislation relating to the commission last year in this House, I made it clear that the Government believed it very important that its recommendations should be given effect, and said that, in circumstances where it had made recommendations but action had not been taken, I would be able to use the powers of last resort granted to me by that legislation to take action myself in line with such recommendations.
In the light of that, and having considered the report, I am persuaded that it would be right to remove for a period the entitlement to the block financial assistance paid to Assembly parties in respect of both Sinn Fein and the Progressive Unionist party, and I propose to do so next Wednesday, 28 April. I have therefore today made an order under the urgency procedure, amending the Northern Ireland Act 1998 as amended by the legislation that we passed last year, to allow me to take this step in the absence of a sitting Assembly. It will also permit me to act to reduce Members' salaries should I see fit to do so in the light of a future IMC report. I will, however, in line with the legal requirement on me to act fairly, take account of any representations that I receive by next Tuesday from the two parties concerned before reaching a final decision.
The commission's other recommendations, all of which the British Government endorse, include that paramilitary groups must cease all forms of criminal activity; and that all politicians and others in prominent roles must exert every possible influence to bring about a cessation of paramilitary activity. I hope that this report, and the firm but carefully measured action that the Government are taking in response to it, will underline that it is essential that all paramilitary activity, from whatever quarter, should cease fully and completely. The commission's next report on paramilitary activity will be able to test whether that has happened, and if not, whether further action is needed. In the meantime, the Government remain firmly committed to the idea that political progress can be
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achieved only through dialogue. I shall continue to meet all the parties in Northern Ireland to explore how we can achieve the basis for a restoration of the devolved institutions.
In the context of the review, a number of interesting proposals have already been made. There is still much to discuss, but the report underlines starkly what steps need to be taken if we are genuinely to move forward to stable and inclusive devolved government. I must reiterate what the Prime Minister, the Taoiseach and others have said on many occasions: all paramilitary activity must come to an end if there is to be a stable future for devolved government in Northern Ireland. That is what the Prime Minister spelled out when he talked of acts of completion. It is what both Governments made clear in paragraph 13 of the joint declaration. The commission recognises in its report that violence and the threat of violence can have no part in democratic politics.
The Independent Monitoring Commission has a vital role to play in securing that development and underpinning it once devolved government is re-established. It has, through the report, demonstrated its impartiality, its competence and its willingness to speak the truth, even when it is uncomfortable to do so. I believe that the whole House will be grateful to it.
Mr. David Lidington: First, I associate myself with the Secretary of State's condemnation of the attacks yesterday on the hon. Member for Belfast, East (Mr. Robinson) and Mr. Alex Attwood. Those events were a sobering reminder to us all of the risks borne and the courage shown daily by democratic politicians in Northern Ireland—both Unionist and nationalist. I also thank the Secretary of State for advance sight of the statement, and pay tribute to the work of the Independent Monitoring Commission and the quality of its report, which has been produced within a very short period.
The report provides a stark and truthful analysis of what is happening in Northern Ireland. There are no euphemisms in it. All the main organisations—the IRA, the Ulster Volunteer Force, the Ulster Defence Association—remain armed, active and capable of full-scale terrorist activity if they so choose. As the Secretary of State said, there is some good news—the number of murders, bombings and attacks on security forces has decreased—but, as the commission says on page 25,
"the level of other paramilitary violence has been and continues to be considerably higher than before the Belfast Agreement."
It goes on to conclude that
"the leadership of the paramilitary groups is directing, rather than seeking to prevent"
that violence.
Perhaps most startling of all to those of us who live and work in England and other parts of Great Britain is the commission's conclusion that if the level of violence experienced in Northern Ireland were extrapolated to the United Kingdom as a whole, since the beginning of January 2003 there would have been 375 murders, 6,300 victims of shooting and 5,700 assault victims.
I have a number of questions for the Secretary of State. Before I deal with the sanctions, I ask him to confirm that the Government intend that paramilitary violence and the organised crime that supports and

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funds it be met with the full force of law. On 24 July 2002, the Secretary of State's predecessor announced that the Attorney-General was to examine on the Government's behalf whether changes in police powers and the criminal law were needed
"to facilitate successful prosecution for acts of terrorism, violence and organised crime."—[Official Report, 24 July 2002; Vol. 389, c. 984.]
What has happened to that work over the past year and a half? Will the Secretary of State also confirm that there can be no question of security normalisation while paramilitary violence continues as described by the IMC?
On sanctions, we shall support the action that the Secretary of State proposes to take—I hope that he will say for how long he intends to cut off funds from both Sinn Fein and the Progressive Unionist party—but can he really be satisfied that today's announcement is sufficient? Frankly, if Sinn Fein is to sacrifice its Northern Ireland Assembly funding because of its links with paramilitary violence, it is surely outrageous for Sinn Fein Members to continue to enjoy both access to and allowances for the House of Commons. [HON. MEMBERS: "Hear, hear."] Will any financial penalty make much of a difference to paramilitary organisations that, according to the IMC and the Minister for Justice in the Irish Republic, are reaping millions of pounds from drug trafficking and other forms of gangsterism?
So, will the Secretary of State consider additional action? In view of the report's evidence of violence by the paramilitaries, will the Government consider—as we have asked them to do before—specifying the Provisional IRA under the Northern Ireland (Sentences) Act 1998? In his statement, the Secretary of State rightly spoke of the responsibilities of those Northern Ireland politicians with influence over paramilitary groups. Does he share my profound concern on learning that Mr. McGuinness, when speaking in County Tyrone on Easter Sunday, paid tribute to the role that IRA volunteers had played
"and continue to play in the struggle for Irish freedom"?
The Secretary of State knows that the Taoiseach of the Irish Republic has consistently and trenchantly stated that so long as Sinn Fein remains linked to paramilitary violence, it cannot be a fit partner in a coalition Government in the Irish Republic. In the light of the conclusions of today's IMC report, surely the Government must now accept that the principle that is right for a Government in Dublin must be right for the formation of an Executive in Belfast.
Mr. Murphy: I am grateful for the hon. Gentleman's welcome for the statement and for the IMC's report, and I certainly agree that the figures in it are startling. On the force of law bearing down on people who commit such crimes, he may rest assured that the Chief Constable is doing a very good job in that respect. Our Organised Crime Task Force is working extremely well, and I hope that the Assets Recovery Agency will deal with the assets of paramilitaries as soon as possible. Between April 2003 and February this year, 139 loyalists and 80 republicans were charged with serious terrorist and public order offences. In the past year, six individuals have received long sentences for extortion. Other convictions have been secured for armed robbery and
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drug offences, and fuel-laundering plants have been dismantled and illegal fuel seized. The hon. Gentleman is right to point out that normalisation as it appears in the joint declaration document cannot happen unless there are acts of completion.
On sanctions, the hon. Gentleman will of course recall that when the relevant legislation was going through this House, it was the statement and belief of this Government that, whatever the Independent Monitoring Commission recommended, it would be very difficult to envisage a situation in which we would not accept it. On this occasion, we certainly do accept the IMC's recommendations and conclusions—as, indeed, do the Irish Government.
The important point to emphasise is that if the Assembly had been operating, the IMC would have recommended something up to, and possibly including, exclusion from office. We do not know exactly what the IMC would have recommended because, as it is aware, the Assembly is not up and running; but it certainly would have considered such action.
So far as the term of the penalty—the sanction—is concerned, there is no particular end. We can renew the order after a year, so there is no limit. I intend to look at the situation after six months, because that is when the IMC will next report. So, for six months, no allowances will be paid in that respect. Obviously, this is a matter for the Commons to consider, but whatever the sanctions, it is very important that they represent and reflect society's disapproval of, and public displeasure at, what has happened.
Although these revelations are startling and sometimes very dramatic, I still hope that the devolved institutions can be restored as soon as possible, and that that will include all parties. I hope, too, that Sinn Fein and the Progressive Unionist party will be involved in discussions on how we achieve that—but we must of course see an end to paramilitary activity.
Lembit Öpik: The Liberal Democrats also welcome the Independent Monitoring Commission's report and its detailed analysis of what has been going on. I was interested to hear the Secretary of State say, "Both Governments accept the commission's conclusions and recommendations." I am pleased to hear it; indeed, they had little alternative. On the financial penalties that might be incurred by political organisations associated with paramilitaries, it seems appropriate, as my colleague Lord Smith of Clifton has said many times, that a financial penalty be imposed for not participating more overtly in the peace process.
I want to ask some questions concerning the Government's commitment to responding to the IMC's recommendations and conclusions with action. The IMC's report details a wide range of illegal activities committed by a number of organisations. Given that those activities undermine the democratic process and the rule of law, will the report alter the Government's definition of a ceasefire? In the light of the IMC's comments, do the Government intend to change their approach to peace process discussions with parties linked to named paramilitary organisations, or do they intend to carry on as if nothing has happened? Was the postponement of the Lancaster House talks related to the contents of the IMC's report? In the light of that postponement, will the Secretary of State clarify the status of the review?

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Are the Government expecting to have any meaningful discussions this side of the European elections? Given that the IMC has been able to recommend only rather weak sanctions, in the form of financial penalties, what plans do the Government have to review the powers of the body, specifically in the context of a suspension?
We all know that Northern Ireland politics is characterised by long periods of negotiation and, it has to be said, a degree of pragmatism. However, does the Secretary of State accept that, unless the Government show themselves willing to act on the recommendations of the IMC, opportunism and a lack of respect for political institutions will continue to be additional ingredients in the mix?
Mr. Murphy: Obviously, the report is disturbing. Equally, it is important to carry on with the process of trying to achieve a stable and proper democracy in Northern Ireland—based on the operation of devolved institutions, together with the peace process. We must do so with all the political parties in Northern Ireland. We always knew that, after the signing of the Good Friday agreement, it would be a difficult road, as has proved to be the case.
Today we are dealing specifically with a report on paramilitary activity, and the hon. Gentleman asked two questions. One was about the ceasefire; it is interesting to note what the IMC says about it. It underlines
"the importance of moving the debate on from one about ceasefires and breaches of ceasefires to one about the totality of illegal paramilitary activities. Though many fewer are murdered, many more are being shot or assaulted."
The legal definition of a ceasefire remains the same, and we do not judge that there has been a breach, but that should not in any way suggest that what we are dealing with today is any less significant, because the reality of the impact on people's lives in Northern Ireland is, as the information in the report shows, far greater. The conclusions on the effect of so-called punishment paramilitary shootings on the individuals assaulted and their families are devastating.
As to the talks, we came to the conclusion that we had not really made sufficient preparation to conduct them in the next week or two; if we did conduct them, they would not be meaningful talks. The talks likely to occur over the next couple of weeks will not be as intensive or high-powered as we originally envisaged, but we should certainly continue to examine areas considered in the review. We have examined strand 1, but not strands 2 or 3 of the agreement. The Northern Ireland political parties, in common with those in Great Britain, are moving towards a period of election activity, which will inevitably have an impact on what happens over the next couple of weeks. However, we will return to intensive talks as we move forward into the summer. In the meantime, I will talk to all the parties. There is a formal meeting tomorrow of the British and Irish Governments, who will be able to consider in greater detail the points that the hon. Gentleman raised.
Mr. Seamus Mallon: It is right that the report reminds us that it is now 10 years
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since the first IRA ceasefire and six years since the Good Friday agreement was signed. It provides confirmation, if we needed it, that we are still in the stranglehold of paramilitary violence and organised crime. It comes as no surprise to many of us, particularly those who live in Northern Ireland, that the report is as stark as it is.
I would like the Secretary of State to clarify one matter. The commission was charged with assessing whether the political leadership of those connected with paramilitary organisations were complicit in, condoning, supporting or allowing violence and organised crime. If the report specifically fulfils the mandate from Parliament to make that assessment—like many others, I look forward to reading it—and finds that that is so, the type of petty-cash penalties specified are risible and will be an embarrassment not just to the Government but to the political process.
My poor mathematical mind has worked out that the type of organised heist of cigarettes that took place in my constituency at Christmas would pay those penalties for 22 years. I ask the Secretary of State and the Irish Government to consider the matter sincerely in that light. If the Independent Monitoring Commission makes such an assessment, we should not waste time on tokenism. To the richest party in western Europe, those penalties mean nothing. They are like levying fines on a rich footballer—nothing more, nothing less. I view this as tokenism—well meaning and for the right reasons, which will perhaps have a peripheral effect. The reality is that until the two Governments, Sinn Fein and the Democratic Unionist party are able to come to terms about the continuation of violence, we will be working at the edges, not getting to the heart of the problem.
I am always loth to give anyone advice, not least my right hon. Friend the Secretary of State, but after 30-odd years of watching attempts to solve the problem, I say sincerely let us not waste time on scratching at the surface. We have wasted too much time already, and there is precious little to waste.
Mr. Murphy: I understand my hon. Friend's frustration about the sanctions, but I repeat two points that I made in the statement. First, we are putting into effect the recommendation of the commission itself, and we made it clear that the Government would do whatever the IMC recommended. Secondly. I know that the House would agree with the important point that, if the Assembly were up and running, it would have been a different picture. Recommendations would have been made up to and possibly including exclusion from office, but that does not apply because the Assembly is not sitting.
My hon. Friend expresses a view that most people in Northern Ireland know: these activities are going on. However, it has now been formally acknowledged by an independent and international body that those activities are indeed going on and disrupting the peace process.
Part 7 of the report is entitled "Leadership of Paramilitary Groups" and I shall quote a few sentences from it because they relate to my hon. Friend's point. Paragraph 7.5 states:
"We recognise that there might not have been a PIRA ceasefire in the first place without influence from the leadership of Sinn Fein. By the same token Sinn Fein must bear its responsibility for the continuation by PIRA of illegal paramilitary activity and must recognise the implications of being in this position."

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It goes on to say:
"While we are satisfied that the Progressive Unionist Party and others exerted a positive influence in achieving the loyalist ceasefires we believe it has not sufficiently discharged its responsibility to exert all possible influence to prevent illegal activities on the part of the UVF and the RHC."
Rev. Ian Paisley: This report is very important. I thank the Secretary of State for what he said about my colleague, my hon. Friend the Member for Belfast, East (Mr. Robinson), and Mr. Alex Attwood. We all know in Northern Ireland that public and elected figures run the gauntlet and we know not what a day may bring forth. It is right that the House take note of that at all times.
What worries me—it evidently also worries the hon. Member for Newry and Armagh (Mr. Mallon), who takes a different view from me of the present troubles—is the problem of delaying, delaying and delaying. We should not have had to wait for this report. The police had done their work and discovered who was behind one of the incidents that took place. Instead of the police dealing with law and order in a proper way, the matter was shelved off to the commission. Will the Secretary of State explain why the Government wanted it shelved off even longer? Those people acted speedily on their own initiative because the Government set them a date a bit later in the year. Why did they do so? Do the Government not want to face up to those facts?
The good thing about the report is that it deals with loyalist violence—so-called—and with IRA violence. I suggest that Members look at page 22 to find out exactly where we are today with that paramilitarism and its awful aggression.
Something else worries me. Can sanctions be taken against terrorists by introducing a murder tax? That is exactly what the Government are trying to do—introduce a murder tax. The Secretary of State even said that the report's suggestions in that regard were appropriate. I do not think they are appropriate at all. If a man is murdered, do we tell the people who are weeping, "Oh aye, but we are taking back the money that we have already paid out"? What sort of nonsense is that? Are we to play soullessly with the blood of innocent people? This is not the time for doing sums and taking back money that the Government have already paid. Those people are losing nothing—in fact, we heard from the southern Irish Minister for Justice, Equality and Law Reform that they are bringing in millions from other sources. Surely, the time has come when we should face up to the fact that there can be no murder tax.
There is only one remedy: if people do not keep to the rules that govern the talks, they cannot be in the talks. If I did not keep the rules, the Secretary of State would have me out on my ear. I remember that, because I had not signed a paper at the beginning of the talks, it was moved that I be put out of the room immediately—but not so the IRA, not so Sinn Fein. We need proper sanctions. If we cannot have proper sanctions through the Assembly, the Secretary of State must legislate in the House to ensure that those who do not keep to the rules cannot take part in the negotiations. That is the final arbitration.
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Until that is done—think of it!—those men can come into this House and strut around these Corridors, yet nothing will be said to them. Why was something not done about that? Does the House condone what those people are doing when it gives them the run of this place? Why was the House not even mentioned in any of the sanctions?
What about the sanctions relating to Stormont? The only appropriate action that the Secretary of State can take is to say, "You are not in the talks". The leader of the official Unionist party made three efforts to bring those people in—
Madam Deputy Speaker (Sylvia Heal): Order. The hon. Gentleman should bring his comments to a conclusion.
Rev. Ian Paisley: All I wanted to say was that those people were brought in, but did it convert them? No. They are at their same old game—going on with their murders. The time has come to call a stop. I welcome what the hon. Member for Newry and Armagh (Mr. Mallon) said today; it shows that there is agreement on both sides of the House that action, not words, is needed.
Mr. Murphy: I think that the House is very much aware that, despite what we read in the report, Northern Ireland is an infinitely better place in which to live and work than it was 10 years ago, because of the agreement and the advances that we have made since. I have no doubt about that. We no longer have the terrible bomb outrages or the number of murders that we saw in the past, but today we have to deal with something that seriously undermines progress towards a political settlement and the peace and tranquillity of people in Northern Ireland. I do not for one second underestimate the significance of that.
We always indicated that we would act on the recommendations of an independent body. The commission is an independent body—not a Government, but an independent body with international representation—and therefore has different status, which is why we are putting its recommendations into effect. I repeat that were the Assembly up and running there would be different recommendations.
The hon. Gentleman is right to point out that the report highlights loyalist and republican violence equally, right across the board in Northern Ireland. In all honesty, there is no correlation between a death—a murder—and any form of sanction. This is not a murder tax, but one way in which we can express our disapproval of what has occurred.
What is much more significant is that, when people read this dispassionate report by independent experts who have no axe to grind, they will see that the situation set out in the report—drug trafficking, extortion, racketeering, smuggling of fuel and cigarettes and, worse, murder, assaults and shootings—no longer applies. That is what the report outlines. Although

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people in Northern Ireland already know that such things go on, the fact that they are set out in that official report gives its contents great weight.
Several hon. Members rose—
Madam Deputy Speaker: Order. May I ask for shorter contributions from Members, so that more of them can question the Secretary of State?
Kate Hoey: The Secretary of State must realise that, although fewer people are being killed these days, if that level of violence and that scale of murder were occurring across the United Kingdom it would be unthinkable for Members to talk about doing so little as taking away a small amount of money that people did not need. What is the Secretary of State's personal view about the fact that IRA-Sinn Fein Members are allowed to come into this House and use its facilities and receive its benefits? Surely, he could take a lead on that; he could say that the House should vote again and take those benefits away. Given the position of the whole IRA-Sinn Fein party and the fact that we have other democratic parties with large majorities, why cannot we go ahead with talks that involve everyone, including the Social Democratic and Labour party, the mainstream Unionists, the Democratic Unionist party and all the other parties that are signed up to peaceful means, and get the Assembly going again with the people who want to be in it—not those who are holding things up because they are into violence?
Mr. Murphy: The talks will go ahead; they have not stopped. The intensive talks that the two Prime Ministers were to lead will not now take place over the next couple of weeks, but further down the line. As I indicated in a previous answer, our view is that we are not yet prepared for that sort of negotiation and discussion. However, that does not mean for one second that we shall not continue to talk about the issues—for example, those we raised some weeks ago in Parliament Buildings about how to deal with the north-south arrangements, the operation of the Assembly and the number of Ministers and so on. All those issues can still be discussed and we shall continue so to do. It is important to understand, however, that unless we get to grips with the issues identified in the report we shall never reach a permanent, settled situation in Northern Ireland, whereby we can have a permanent devolved Administration.
I think that there is a great appetite among people in Northern Ireland for the return of devolution. I am absolutely convinced of that and no one is sadder than I am that it is not yet the case, but we have to keep trying to resolve the difficulties. Even if the parties that are not involved with paramilitary groups were talking to one another—as my hon. Friend the Member for Vauxhall (Kate Hoey) described—we should still have to resolve the problems outlined in the report. We have to see an end to paramilitary activity, and it is vital that that occurs alongside the discussions for a political settlement.
On my hon. Friend's point about the House of Commons, I repeat that the whole purpose in setting up an independent commission was it would have
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legitimacy, which I hope everyone can accept, so that its recommendations would be agreed. Obviously, we shall listen to the comments made by my hon. Friend and other Members and will come back to them at a future stage.
Mr. David Trimble: Is it not a pity that we did not have the report two years ago when we first proposed such a body?
I welcome especially the reference in the report to the IMC's willingness to exclude from office. May I ask the Secretary of State to comment specifically on that? Will the Government now support such action?
As has been said, there is a weakness: the IMC cannot sanction organisations without political representation. That omission is particularly glaring with regard to the Ulster Defence Association, which is a major offender in terms of continuing violence. But does not the Secretary of State have the power to act under the prisoner release legislation? Would not such action be better than the proposed financial penalties?
Finally, I am sorry that next week's talks have been cancelled. Was the cancellation caused by the fact that, after the action that the Government have announced today, some parties were perhaps unwilling to attend?
Mr. Murphy: It is not a cancellation; it is a postponement. Intensive talks dealing with such matters will take place nearer the summer.
With regard to the point about exclusion, the right hon. Gentleman will know that we made it clear on the Floor of the House—I did so earlier today—that if the IMC recommended a course of action, it would be very difficult for me to envisage a situation where we would not accept that, irrespective of whether it included exclusion. We would obviously have to consider that recommendation if it were made. The IMC has not recommended that. It said that it might have done so if the Assembly had been up and running.
Again, on the prisoner release legislation, I return to the point that, yes, we could do all sorts of things, but the purpose of that body is to make specific recommendations to the Government to deal with the issue. The report does the great service of highlighting what the situation is in Northern Ireland today to people—not just those in Northern Ireland, but those in Great Britain, too, and in Ireland—who may not have studied these things as closely and carefully as hon. Members do.
Mr. Iain Luke: My right hon. Friend is correct to suggest that there has been a movement away from the violence that we saw in previous years, but the statistics are still startling—one death a month and three beatings or shootings a week—and the number of deaths would have doubled in February but for the swift intervention at Kelly's Cellars. Will my right hon. Friend undertake to pass the report to the Leader of the House and the appropriate House authorities, so that proper sanctions can be considered with regard to the access and allowances granted to one of the parties, whose members have access to the House but do not take their seats? There could then be a true set of sanctions to enable a

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realisation that we can achieve a true dialogue in Northern Ireland only by a complete withdrawal from supporting groups with terrorist aims.
Mr. Murphy: I have already indicated that I will certainly pass on my hon. Friend's views and those of other hon. Members who have expressed their views with regard to the House of Commons. Of course, the IMC's members will be able to read in Hansard what the House has discussed today.
With regard to my hon. Friend's emphasis on continued paramilitary violence, he is right to suggest that such violence causes us great worry. What has disturbed me over the past few months is that, each time that I go into the office, the number of so-called paramilitary shootings and so-called paramilitary punishment beatings has gone up and up on both sides, and there is no place for that in a modern democracy.
Mr. Andrew Robathan: I welcome the statement by the Secretary of State, for whom I have great respect. This is a major change of direction in Government policy in Northern Ireland. By accepting the IMC's report and by taking such action, the Government are accepting the principle, beyond peradventure, that the leadership of Sinn Fein and other paramilitary organisations are directly responsible for the direction of paramilitary violence. I am delighted to hear him say that, because everyone has known that for a very long time.
Will the right hon. Gentleman pursue the logic of that position? Will he enforce all aspects of the Belfast agreement, which came into effect nearly six years ago? Will he ensure that, for instance, there is total decommissioning before we have further negotiations with Sinn Fein and others? Will he ensure that no Adams or McGuinness walks these Corridors and draws parliamentary allowances—public money—to further their evil causes? Will he now stand up, as I believe he would wish to, and force the paramilitaries either to accept the Belfast agreement or to be excluded from it altogether?
Mr. Murphy: I do not think that the Government have changed their view on what the report says about paramilitary activity. We have always indicated that we thought that such activity was the great stumbling block to progress. Of course, the hon. Gentleman is also right to point to decommissioning. That, too, is an important issue, which the Belfast agreement addressed, but which had not been addressed properly over the past few months. However, if political parties—whether Sinn Fein or the Progressive Unionist party—wish to progress their political ends in a peaceful and democratic manner, those are legitimate aims for which those parties rightly appeal to the electorate in Northern Ireland. Of course, Sinn Fein increased the number of its members of the Assembly, and the Progressive Unionist party still has a representative in the Assembly. By no means do I dismiss the importance of those political parties to the process—they are immensely important, and there must be an inclusive peace process, but that must be divorced from violence in all its forms.
David Burnside: If I was, God forbid, Gerry Adams, Martin McGuinness or, more
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appropriately today, Slab Murphy, or a brigadier in the Ulster Volunteer Force or the Ulster Defence Association and I was going over the past 12 months' accounts of the criminal empire that I controlled, I would be laughing. I would have a smirk on my face, and I would say, "The British and the Irish Governments—my God, aren't they tough? Haven't they really taken us on?" We are talking about a few thousand pounds for a multi-million pound empire, whether in south Armagh, the UDA or the UVF.
The Government have a choice today: they can use the report and move in one direction; or they can take the report and be laughed and smirked at by the brigadiers and the members of the army council of the IRA. If only a few thousand quid of the Assembly salaries is involved, with no action in Westminster, they will continue to laugh. The Government must take strong measures. The punishment must fit the crime, and the crime and terrorism continue right across all the so-called loyalist bodies and the Provisional IRA. I hope that the Secretary of State will consider moving towards the total expulsion of Sinn Fein and the loyalist paramilitary front organisations from the political process, so that the democrats can move ahead. That is what will frighten the paramilitaries; they are not frightened today, Secretary of State.
Mr. Murphy: I have indicated on more than one occasion, in many ways it is not a financial penalty or sanction which is the important issue. Although that is important, it is not so important as the fact that the independent body—made up of internationally recognised people—has now been able to tell the world what is going on in Northern Ireland in a very special way. All of us as politicians in one form or another over the past few years have said more or less the same thing, but that has now been done formally by an independent commission that was set up by two Parliaments and two Governments, so that the world now knows that these are serious issues that need to be addressed.
Mr. Nigel Dodds: Is not the report a savage indictment of those who as recently as last October were praising the words of Sinn Fein-IRA leaders and getting ready to admit IRA-Sinn Fein to government, not for the first time, not for the second time, not for the third time, but for the fourth time in Northern Ireland, following another so-called decommissioning event? Is not the fundamental lesson that, six years after the Belfast agreement, democracy in Northern Ireland cannot be held to ransom any longer?
The Secretary of State says that, if the Assembly were up and running, other measures would be taken, up to and including the exclusion of Sinn Fein-IRA. Is it not now the time to move ahead with the political process, including the talks, without Sinn Fein-IRA, applying the analogy as though the Assembly were up and running? Let us move forward without them. Let us go forward with those who are committed to exclusively peaceful and democratic means. Let us stop, in the words of the hon. Member for Newry and Armagh (Mr. Mallon), wasting time on laughable fines that will be dismissed out of hand by everyone in Northern Ireland.

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Let us get on with the democratic parties and find a way forward with those who want to make progress in Northern Ireland.
Mr. Murphy: One of the ways forward is to try to stop the activities that are outlined in the report. That has to happen, too. I have given some indication to the House about the way in which the Police Service of Northern Ireland, the Organised Crime Task Force and so on have successfully dealt with those issues. Of course, much still needs to be done and we must carry on along those lines, but there is an important job of work to be done to ensure that we see an end to such activity, so that we can have an inclusive process in Northern Ireland. Now, at the end of the day, if what the hon. Gentleman wants is to come about, it will still have to do so on the basis of an agreement between nationalism and Unionism for it to work.

Orders of the Day

  Finance Bill
  [Relevant document: The Sixth Report from the Treasury Committee, Session 2003–04, on the 2004 Budget, HC 479.]
  Order for Second Reading read.
  Madam Deputy Speaker (Sylvia Heal): I should inform the House that Mr. Speaker has selected the amendment in the name of the Leader of the Opposition.
  2.20 pm
  The Chief Secretary to the Treasury (Mr. Paul Boateng): I beg to move, That the Bill be now read a Second time.
  The 2004 Budget set out the next steps of the Government's economic policy making by outlining what we would do to lock the hard-won progress that we have made into this country's economic stability and growth so that it endures, and to equip the country with the means with which to compete in a global knowledge-based economy. The Government have examined the challenges and pressures that face the nation now and will do so in future, and we are determined to take the right steps to meet those challenges.
  We are here today for the Second Reading of the Finance Bill and, as I look around the Chamber, I see the cast assembling for the many long hours of debate that lie ahead, under the leadership of my right hon. Friend the Paymaster General. I know that those of us who are graduates of previous Finance Bills feel a sense of anticipation regarding the struggle that is to come.
  The Bill reflects the determination on the part of the Government to introduce the measures that will implement the next stage of our economic policy—a policy that has been and continues to be characterised by stability—enterprise fairness. In so doing, the modernisation of the tax system and the protection of tax revenues go hand in hand with greater investment in public services and improvements in efficiency. Together, they will lock in the stability that this country has enjoyed during the seven years of the Labour Government's stewardship of the economy.
  Our proven macro-economic policies and the tough fiscal decisions that we have taken have already provided us with a sound economic foundation on which to base our policies. The United Kingdom is enjoying the lowest inflation for 30 years, the lowest interest rates since 1955, and the lowest unemployment for a generation. While America, Germany, France, Japan and much of Asia have suffered recessions, the British economy has grown uninterrupted since 1997—over 46 consecutive quarters. On that foundation, we shall continue to build an enterprising and knowledge-based culture. In doing so, we shall work to ensure fairness in the tax system and throughout our society, and to strike a balance between economic growth and environmental protection.
  Compare and contrast that record—our policy, our programme—with that of the Conservatives. They ruined the economy in the 1990s. Their record shows why they can never again be trusted with the economy

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  and why our hard-won economic stability cannot be taken for granted. Their extremist policies do not add up, they would require massive cuts in vital public services, and they show why no one can afford to believe the Conservatives, now or in future. Not only have they failed to learn from their mistakes—[Laughter]—but their new policies are more extreme than before. Underpinning their smiling and laughing faces is hard-nosed, hard-faced extremism. [HON. MEMBERS: "Oh!"]
  I hear a certain amount of incredulity from Conservative Members. It is good to see the hon. Member for Arundel and South Downs (Mr. Flight). When he assumes his place, we know that it is that time of year: he has been let out and will be set loose on the Finance Bill. Well, good—Government Members welcome that, because we have some questions for him. We want to ask him about the newsletter that he sent to the Conservative City Circle—an interesting body, which receives newsletters from him from time to time. Whenever the Conservative party wishes to disown the hon. Gentleman, it glosses over the fact that he is the shadow Chief Secretary and refers to him as the party's "City expert". Well, the Conservatives' "City expert" has been writing to the Conservative City Circle, and in his letter he states:
  "Our medium term expenditure strategy … calls for real reductions in areas other than Health, Education, Pensions and Welfare".
  We hope that in the course of the hon. Gentleman's address to the House this afternoon, he will explain where the cuts are to fall.
  The Conservatives have apparently identified some £18 billion in cuts to be made immediately. The shadow Defence Secretary said of the cuts:
  "It is outrageous. You cannot possibly go into an election with this pledge."
  The shadow International Development Secretary said:
  "If we are to be taken seriously as a party of government which cares about the most vulnerable people on the planet, there has to be a public spending commitment."
  Because the cuts must fall on the police and security services as well, the shadow homeland security Secretary has—according to The Sunday Telegraph, a journal of record if ever there was one on matters concerning the Conservative party—
  "protested that the cuts, if implemented, would badly damage their future departments."
  The shadow Home Secretary has
  "asked for reassurance that the freeze would not lead to cuts in police numbers."
  Mr. Michael Jack: Will the right hon. Gentleman give way?
  Mr. Boateng: Let me finish my line of thought first.
  I hope that in the course of his speech this afternoon the shadow Chief Secretary will answer the many concerns that I have outlined, which have been voiced by his right hon. and hon. Friends on the Conservative Front Bench. The nation is entitled to hear where his cuts will fall.
  Mr. Jack: I am most grateful to the Chief Secretary for interrupting his passage of self-congratulation. Will he confirm that it is the Chancellor's intention to cut
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  expenditure on the civil service by some £20 billion over the next few years? If things have been so splendidly managed, how is it that the Government are having to remove 40,000 civil servants from the payroll?
  Mr. Boateng: The right hon. Gentleman is absolutely right to point to our commitment to raise public sector efficiency and to release extra resources to the front line of our priority public services. Our ambition is to deliver some £20 billion of annual efficiency gains by 2007–08 through a 2.5 per cent. annual efficiency target for the whole of the public sector. That has been identified for us through the work taking place under Sir Peter Gershon, which will be reflected in due course in the outcome of the spending review. What we do not see is any exercise on the Conservatives' part that is comparable with the work into which we have entered in the Gershon efficiency review.
  Perhaps this afternoon all will be revealed and the Conservatives will unveil their plans. [Interruption.] The shadow Chancellor says, "Wait and see." We are in for an interesting afternoon if we are to have sight of the Conservatives' spending plans. What we know is that they propose an immediate cut of £18 billion. We know what that would mean. The number of police officers would be cut. The effect on our armed forces would be devastating: a cut in defence spending of £1.5 billion is equivalent to cutting armed forces personnel by 40,000.
  Mr. Peter Atkinson rose—
  Mr. Boateng: I shall finish this point before giving way.
  If that is not the Conservatives' policy, we are entitled to hear what is. We reject the plans of the Opposition, who would fail to invest in employment opportunities by scrapping the new deal. They favour deep spending cuts year on year, regardless of the needs of public services. Their dogmatic plans to cut spending by £18 billion would weaken the economy and put at risk its hard-won stability. The Government recognise the need to introduce measures that would create a platform of stability for business, and enable the UK to keep pace with the global economy. Promoting enterprise and productivity has long been a key aspect of our economic policy making, and the Bill introduces specific measures to advance that aim. I know that it is tedious for the shadow Chancellor, but I fear that I must take him through those measures. After all, that is the purpose of Second Reading.
  Mr. Oliver Letwin rose—
  Mr. Boateng: If the right hon. Gentleman can contain himself, I shall give way in a moment.
  Since 1997, we have taken a number of steps to reform the business tax system and reward entrepreneurship, including cuts in corporation tax and the introduction of targeted measures such as research and development tax credits and measures to reduce the administrative burden of VAT. We have already cut long-term capital gains tax for business assets from 40p to 10p. This year, rates of corporation tax and capital gains tax will both remain frozen. To assist small businesses' cash flow and provide enhanced funding for new investment we have

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  increased the first-year capital allowances for small business investment in plant and machinery from 40 to 50 per cent., and that increased allowance will be available for 12 months from April 2004.
  The VAT threshold has been raised to £58,000, the most generous VAT threshold in Europe. In addition, up to 13,000 businesses will be eligible to benefit from simplified VAT accounting. From next year, in 2,000 enterprise areas, we will further increase the tax incentives to invest. To increase the incentive to invest in research and development, a new definition of research and development tax credits will come into effect on 1 April 2004, extending the tax credit to power, fuel, water and software costs, totalling a further £35 million-worth of support.
  Mr. Atkinson: I thank the Chief Secretary for giving way. The moment, however, has passed, as I wanted to point out that he had been speaking for 10 minutes about our policies. I would rather hear my hon. Friends do so. I was going to ask him when he was going to discuss the Bill, but he has begun to do so.
  Mr. Boateng: The hon. Gentleman must be enjoying enormously what I am saying now.
  To encourage the incentive to invest in new businesses, and following consultation with industry, the Bill confirms the Government's commitment to allowing investments in venture capital trusts to secure tax relief of up to £200,000 a year, not at the lower rate of 20p but at the higher rate of 40p. Promoting enterprise and competition is important, but it must be underpinned by fairness. Our objective continues to be ensuring stable public finances and world-class public services, which are served by a fair tax system in which everyone pays or claims for what is due. To protect revenue for investment in the public services that the country wants and needs, we are determined to tackle tax avoidance and evasion. I hope that in Committee that theme will find support among Members from all parts of the House.
  Mr. David Laws rose—
  Mr. Boateng: No doubt the hon. Member for Yeovil (Mr. Laws), who speaks so well for the Liberal Democrats when he is allowed to do so, will express his support for the measures that my right hon. Friend the Paymaster General will discuss in detail in Committee.
  Mr. Laws: I am delighted to give my support to measures to clamp down on tax evasion and avoidance. Such measures can have unintended consequences, and the Chief Secretary will be aware of concerns over the weekend that many people who ran in the London marathon will have to pay VAT on the money that they are seeking to raise for charity. Do the Government intend to see whether they can remedy that?
  Mr. Boateng: If the hon. Gentleman casts his mind back to debates on the previous Finance Bill, he will agree that we are concerned to avoid unintended consequences. Customs and Excise have issued detailed
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  guidance to charities helping them to avoid such consequences. I hope that charities follow that guidance so that they can avail themselves of the generous concessions available. I am sure that the hon. Gentleman acknowledges that since 1997 there has been an unparalleled increase in such concessions under this Government.
  Mr. Laws rose—
  Mr. Mark Prisk rose—
  Mr. Boateng: For the sake of balance, it is only fair that I give way to the hon. Member for Hertford and Stortford (Mr. Prisk).
  Mr. Prisk: On Saturday, I wrote to the Economic Secretary on this very issue. Could the Chief Secretary tell us whether the Government will ensure that the charities are not out of pocket? That was done after the death of Princess Diana in relation to the charitable returns from the record, "Candle in the Wind". Will the Government repeat that gesture, or do they intend to ignore charities' genuine worries?
  Mr. Boateng: As the hon. Gentleman knows, that is a different matter. He is aware of the considerable contact that the Inland Revenue and Customs and Excise have with the charitable sector and voluntary and community organisations to make sure that they avail themselves of the available concessions. That contact will continue, and I hope that he welcomes the steps that the Government have taken through gift aid and a variety of other measures to ensure that voluntary and community groups and charitable organisations take full advantage of the available concessions.
  Several hon. Members rose—
  Mr. Boateng: I must make progress, I am afraid.
  To protect the revenue for investment in the public services that the country wants we are determined to tackle tax avoidance and evasion. We have therefore introduced a number of legislative changes to close loopholes that have been exploited for tax avoidance, and we are taking steps to target low rates of corporation tax on small businesses that are reinvesting to ensure that distributed profits are subject to a minimum corporation tax rate of 19 per cent. We are protecting the zero rate as an incentive for businesses to invest for growth, enterprise and productivity.
  We have also introduced new requirements to disclose the use of direct tax and VAT avoidance schemes. As a result of the continued high level of spirits duty fraud, we will legislate to implement the Rogues report recommendation to stamp spirit bottles. Recognising the costs to the trade, however, we will assist it with cash-flow costs and defer payments for tax stamps. In addition, spirits duty will remain frozen for the seventh successive year and, as my right hon. Friend the Chancellor made clear, for the remainder of this Parliament. My hon. Friend the Economic Secretary has spent many hours in discussion with the industry, and has made himself available to right hon. and hon.

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  Members in all parts of the House in order to make sure that we get this right. Considerable progress has been made in ensuring that we tackle the evil of the illicit trade in spirits.
  Sir Robert Smith: Not long ago the Prime Minister as leader of the Labour party chose to abolish a different clause IV. Now through clause 4 of the Finance Bill the Government are imposing a burden on the whisky industry that I am not convinced will tackle the problem that they seek to address. Can the Chief Secretary clarify how he means to help operators who have small production lines and therefore cannot necessarily predict whether their bottles will need stamps for the internal market or no stamps for export? That will impose added burdens and costs not just on the cash flow through the acquisition of stamps, but on the production line. The measure will be a burden on all operators, but for the small operators especially, the stamp could be a particular difficulty in the management of their business.
  Mr. Boateng: My hon. Friend the Economic Secretary has spent some time, as have civil servants in Customs and Excise, in discussion with the industry about the particular concerns of small distilleries, and progress has been made in that respect. There will be help with their additional costs, and those discussions continue in order to make sure that they are given every assistance that is reasonable and practical.
  The evasion of duty on spirits is a matter of widespread concern, not least to the industry, because of the way in which illicit trade undermines the brands. The Rogues report went into that in some detail. I recall from my own time as Financial Secretary the detailed discussions and measures that we undertook together with the industry to tackle the problem, but it is clear that it continues to escalate. That is why the measure is a proportionate and reasonable response.
  Mr. Richard Bacon: The Chief Secretary is right that the illicit trade is of concern to the legitimate industry. Does he recognise that it is also of concern to taxpayers that, as was pointed out in the Roques report, the actions of Customs and Excise—which, I accept, have improved since—contributed dramatically to the losses to the taxpayer? Some £800 million of revenue was lost, £341 million to London City Bond alone.
  Mr. Boateng: I rather regret that I gave way to the hon. Gentleman. He knows that that is an entirely different point from the one—
  Mr. Prisk: Will the right hon. Gentleman give way?
  Mr. Boateng: No, I certainly will not. I have been given sufficient forewarning by the intervention of the hon. Member for South Norfolk (Mr. Bacon) not to give way to the hon. Member who sits on the Opposition Front Bench. The point made by the hon. Member for South Norfolk was entirely different from the one that I was making and was recognised in the Roques report. It was a one-off and, as he fairly said, there has been considerable improvement since in the performance of Customs and Excise.
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  Through tax stamps we are dealing with a significant fraud that not only deprives the Exchequer of revenue, but creates unfair competition for honest businesses and serves as a conduit of resource for organised crime. The industry, through the joint alcohol and tobacco consultation group, worked hard and constructively to develop a response to the problem, but we know that the anti-fraud impact of that package fell significantly short, and if it continued, would still fall significantly short of that estimated to result from tax stamps. It is right, therefore, that we should protect the revenue as we propose, but offsetting measures will reduce substantially the impact of compliance costs.
  Mr. Prisk: I appreciate that the situation is awkward for the Chief Secretary, because he is on record previously as being strongly opposed to such a measure, but this is a day for U-turns by those on the Government Benches. May I ask the right hon. Gentleman a simple question? Given that the Government expect to get only £160 million back from the measures, what is the logic for spending £280 million, which is the experts' best estimate of the cost of the scheme? It cannot make sense.
  Mr. Boateng: Those figures are not accurate. The hon. Gentleman knows very well why it has been necessary to take the measures. The work of the National Audit Office, the investigation carried out by the Select Committee and the work of Customs and Excise all indicate a loss that needs to be addressed. We must be clear about this. Yes, it is right that there should be a fund to assist with capital investment. It is right, as the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) said, that we should take particular note of the position of small firms. That is why my hon. Friend the Economic Secretary has targeted the assistance at smaller firms in particular, in order to mitigate their upfront costs. Customs is having further discussions with the trade on design, terms and coverage. It is right that we address this mischief. I hope that in Committee, we will be able to build some sort of consensus around the need to tackle a serious fraud.
  Together with these and other measures to safeguard fairness in the tax system, the Budget makes a real contribution, ensuring that everyone pays their way and that as little as possible is wasted through avoidance and fraud. It is important to tackle such behaviour and to ensure that taxpayers' money is safeguarded and spent efficiently.
  Of course, fairness extends across the generations. The Government recognise that we have an obligation to future generations to pursue sustainable economic growth that delivers our economic, social and environmental objectives, and to meet our domestic and global responsibilities in that regard. Environmental action of the sort enshrined in the Budget and the Bill that puts it into effect is not incompatible with productive business. It is to the advantage of businesses to adapt and invest now in new practices, and so stay ahead of the global trend.
  We have already made considerable progress with the environmental agenda through the introduction of measures such as the climate change levy, the United Kingdom emissions trading scheme, the aggregates levy, and support via the Carbon Trust and through enhanced capital allowances for energy and water-saving

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  technology. These measures are not designed primarily to raise revenue, but to incentivise environmentally responsible behaviour by business.
  In the Bill we will introduce new eligibility criteria for climate change agreements, which will increase the number of businesses that can participate in the scheme, boosting both the environmental impact and business competitiveness. Given business success in delivering on climate change objectives, and taking account of business competitiveness, we will freeze the rates of the climate change levy. There has been a real partnership between industry and Government in this respect and considerable progress has been made. We are keen to encourage households as well as businesses to tackle energy efficiency, and we have introduced a package of measures that includes incentives for the private rented sector to invest in energy efficiency.
  The Finance Bill advances some of the key steps to ensure that the country has the means to meet the challenges of the future, but it is important for individuals to be able to do that too. That need drives our pension simplification measures, which are the most radical changes to the taxation of pensions for a generation. Simplifying the taxation of pensions is the cornerstone of making pensions easy for everyone to understand, thus enabling everyone to prepare for the future.
  The eight different tax regimes for pensions were built on top of each other, leaving us with a maze of regulations through which the citizen and consumer must make their way, and often driving arbitrary distinctions between employees. We are sweeping away that complex system and replacing it with a single regime with an easily understood lifetime allowance for tax-privileged pension saving and a tax-free lump sum of up to 25 per cent. for all.
  Annual limits on savings that vary according to an individual's age, the date on which they joined a scheme or the type of the scheme will end. As decision making becomes easier for savers, so administration will become simpler for employers and providers, which will reduce costs in the long run. Simplification matters if people are to save as flexibly as they now work. When we have simplified the system, it will be possible to draw a pension and carry on working for the same employer, perhaps for fewer hours a week. By creating a simple system that enables people to plan and save for their retirements, the Bill renews and affirms the Government's role in the UK pensions partnership.
  Mr. Andrew Mitchell: I agree with the Chief Secretary about the merits of simplification, which is one good aspect among the litany of bad aspects of the Government's pension changes. If he is trying to encourage savings, however, will he explain why he is reducing the amount that people can save through individual savings accounts and making other disadvantageous changes for ISA holders? Next year, why does he not increase the figure from £7,000 to, for example, £10,000 or even £15,000 per year, instead of reducing the capital figure allowed to £5,000?
  Mr. Boateng: The hon. Gentleman takes an interest in such matters, and will therefore remember the
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  introduction of ISAs. He knows that a transitional period was always intended, which is precisely what has happened. His proposal is over and above the initial ISA scheme, and, although I hear his point, it does not commend itself to the Government.
  The Government aim to maintain the UK's position as a low-tax environment, and that ambition is enshrined in the Finance Bill. The Bill builds on and develops the macro-economic stability that is essential for our future productivity, growth and prosperity. It supports business while ensuring fairness, which will enable this country to match its new-found economic stability with the confidence to excel in the future.
  The dividing lines between the Government and the Opposition are clear, and the choice of two futures for Britain is plain: either sustained economic stability or a return to the Opposition's economic stop-go and recession; either investment and reform in health, education, transport and tackling crime, or cuts, charges and privatisation; either expansion of the new deal to build on the success of helping more than 1 million people move into work and getting unemployment to its lowest levels since 1975, or, under the Conservatives, the abolition of the new deal and a return to high unemployment; and either investment and targeted help to develop science innovation and enterprise in our universities and in communities across Britain, or a Britain of Tory laissez-faire, where the fortunate few succeed and everyone else's potential is simply written off.
  In the competitive global economy of the future, the intellectual capital of our country will drive its economic growth, and it is therefore imperative that we invest in our children's education, in adult skills and training, and in science, innovation and enterprise. Those investments will enable us to reach our potential as individuals and as a nation, and make Britain a world leader of the future global economy.
  Our plans enable us to meet the needs of this country's future. The Conservative party has made its decision, which is to cut spending and privatise and run down our public services. While the Labour party will invest in skills, science and enterprise, the Conservative party would slash spending in all those areas. Conservative Members laugh, but they are committed to axing the new deal—they would weaken the economy and return us to an era of boom and bust. We will invest in those areas that will enable the UK to grow and ensure prosperity not only for some but for all, while the Conservative party would put that at risk and cut public spending by £18 billion.
  The Budget laid down the measures that will enable the UK to respond to and meet the challenges of the global economy, and the Finance Bill sets them in statute.
  2.56 pm
  Mr. Howard Flight: I beg to move,
  That this House declines to give a Second Reading to the Finance Bill because the provisions contained in its 574 pages increase the burden and complexity of taxation, particularly on

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  small owner managed businesses; do nothing to increase the savings rate or improve United Kingdom productivity; and will lead to a further decline in the competitiveness and relative attractiveness of the United Kingdom as a location for investment.
  First, I refer hon. Members to my declaration in the Register of Members' Interests. Secondly, I congratulate the Chief Secretary on a better performance than that in the recent Budget debate, but his promotion of his own Finance Bill lacked both conviction and enthusiasm.
  This is, perhaps, the dullest Finance Bill for a long time, but I imagine that the Chancellor is proud of himself for adding another 574 pages of tax complexity for businesses and citizens to cope with—admittedly, 158 pages deal with the new tax regime for pensions. The reforms were supposed to simplify arrangements and, as the Chief Secretary said, to create a single new system, but if he read through the 158 pages he would find that the Bill sets out six new systems to replace the eight old systems.
  If the Government were in listening mode, they would find that pension professionals are offended and outraged that this massive piece of complex legislation has been introduced without prior consultation, which permits no more than three months of digestion, analysis and criticism as the Finance Bill moves through its parliamentary stages. The time scale is unnecessary because the new measures will not become effective for two years—Green Papers are different from specific consultation on detailed legislation.
  Virtually all economic commentators agree that the background to the Finance Bill is the Chancellor's need to raise taxation sooner or later in the face of a current structural deficit of some £35 billion with, by the Government's own measure, full capacity in the economy next year. In addition, there is an estimated £13 billion black hole arising largely from what the Institute for Fiscal Studies assesses as over-optimistic projections for corporate tax revenues.
  Citizens and businesses do not face major tax increases only if Labour win the next general election— the tax take is going up by nearly 8 per cent. this year, to £31 billion, after a 6 per cent. increase last year and before a further 8 per cent. increase next year.
  Angela Eagle: The hon. Gentleman mentions that the economy will run at full capacity next year. Is he against economies running at full capacity?
  Mr. Flight: Perhaps the hon. Lady might like to take a lesson in basic economics. The simple point is that if an economy is at full capacity and public spending is then in significant deficit, there is a risk that that will lead to inflation. Of course it is a good thing for economies to run as close as possible to full capacity, but it is unwise to operate a structural deficit at that stage of the cycle. Indeed, that is the very principle behind the Chancellor's fiscal rules.
  The shame revealed by the Government's own Office for National Statistics figures is that the massive increases in taxation and public sector spending since 2000 have failed to deliver the improvements in public services that were promised. Rather, the spending has gone on public sector inflation, which has risen to nearly
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  10 per cent. this year compared with just 1.6 per cent. in 1997. Hon. Members may care to note that the ONS data also showed that productivity in the public sector fell by 5 per cent. during the past two years.
  The Chancellor himself now admits to the waste in public spending that his policies have produced. No longer can he or his colleagues make silly assertions that those seeking to make the public sector more efficient have to cut front-line services. Conservative Members hope that the Chancellor will achieve his plans for public sector savings of £20 billion a year and that the Gershon review will be more successful than the Chancellor's discredited targets regime. But like the Treasury Committee, we await further details and explanations as to how the 2.5 per cent. annual efficiency savings will be achieved.
  The working draft efficiency review paper, which I have read, is a highly theoretical analysis. It highlights four main cross-cutting ways in which savings efficiencies can be achieved, but its conclusions on 2.5 per cent. savings do not follow from those four main areas. It looks as though one person wrote the first half of the report and another person wrote the second. Gershon's review is based primarily on benchmarking. It has set targets and leaves it to each Department to determine how they will be achieved. The work that is now being done by the James committee on our behalf is looking much more specifically at each Department and each area of the public sector to determine where and how improved efficiency and improved delivery can be achieved. We have also set six targets by which we will evaluate the Government's efficiency savings plans, as well as our own.
  May I give the Chief Secretary a little lesson in arithmetic in relation to his earlier comments? First, he should be aware that it is delivery that matters, not spending. One can have huge increases in spending, but if delivery does not improve, it is a waste of time. Secondly, if one achieves a situation whereby inflation is 2.5 per cent., which is roughly the Government's target; efficiency savings of 2.5 per cent. are achieved, which is the Government's target; and the amounts spent are frozen, the result is that there is no actual cut in services, because the effective real spending save of 2.5 per cent. is compensated for by the efficiency gains of 2.5 per cent. That is precisely what my City Circle paper was getting at. The Chief Secretary would be welcome to join us so that he can learn a little more about the public finances and improve on the way in which he does his job.
  The Chancellor's general-election-campaigning Budget speech not only failed to address the key issues facing the British economy, but omitted any reference to 48 per cent. of the measures contained in the Bill. As the Chancellor well knows, but dare not say, all his contrivances and changes to the bases of calculations in order to claim that he has met his fiscal rules avoid facing up to the fact that growth has been sustained by consumption growth well in excess of gross domestic product growth and financed by a growing mountain of personal debt; and that will now be added to by another £150 billion of Government debt by 2007, as set out in the Red Book. But the productivity growth that is needed if that is to be sustainable has declined and is half that achieved under the previous Conservative Government. The savings rate has similarly fallen to half what the Labour Government inherited from us in 1997.

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  The Chancellor had nothing to say about addressing those issues. With interest rates now rising, and the Government themselves predicting zero slack capacity in the economy by next year, any prudent Chancellor—particularly one who believes so passionately in micro-management—might have sought at this stage in the cycle, in this Finance Bill, to have increased the savings rate; but the Bill contains no incentives for savers. Rather, as contrived outside the Bill, individual savings accounts will be considerably less attractive for the 12 million ISA savers as a result of the loss of tax credits on equity dividends and the reduction in the limit from £7,000 to £5,000 a year—from £3,000 to £1,000 for cash ISAs. As the Treasury Committee commented, those measures appear to run counter to any policy of encouraging people to save. In particular, the major reduction in the limit for cash ISAs is bad news for lower income and younger savers. We will table a new clause to address those problems.
  Mr. Jack: Does my hon. Friend agree that his critical analysis is made all the more important in light of the substantial losses that many have experienced on endowments and similar financial instruments; and that therefore, to ensure that people can meet their long-term personal financial obligations, encouragement to save at an individual level is even more vital at this time?
  Mr. Flight: I thank my right hon. Friend for making that point, which is particularly relevant in the face of the problems that many have experienced. There is the wider economic point that when an economy is at full capacity and when interest rates are rising, with the threats that that can bring to the economy, one of the things that can prevent that from boiling over into economic problems is boosting the savings rate. A wise Chancellor would try to get the savings rate up at this moment in the economic cycle, as any economist would tell him. The truth, however, is that the Government's savings policy is a mess and has virtually disappeared off the Chancellor's radar screen, just as he has dropped any reference to the equally important need to improve productivity growth.
  There are some measures in this leviathan Finance Bill that Conservative Members support. The rebating of all VAT on church repairs is long overdue, particularly given that charities are collectively paying nearly twice as much tax as under the last Conservative Government following the loss of advance corporation tax. We welcome the delivery of the promised extra relief for community amateur sports clubs and the child care voucher proposals. However, too much of the Bill is about leeching the tax system and will fall particularly hard on small businesses and on ordinary citizens.
  The Chancellor's biggest sting was fixed last year with the freezing of tax thresholds and allowances. As hon. Members will realise, a fiscal drag serves to pull large numbers of additional people into the higher income tax rates. In his Budget speech, the Chancellor failed to mention the tax rise from £110 to £600 a year for drivers who use company vehicles for private use. Nor did he mention the imposition of an income tax charge, retrospectively, on those who have made perfectly legal arrangements in the past to enable them to pass on their
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  houses to their children while occupying them until their death. The cause of the problem there is that, as a result of the Government's policies, house prices have risen by much more than the inheritance tax threshold. The Chief Secretary referred to the natural obligations that one generation feels towards the next, but the Government seem not to understand that it is very natural for parents to want to hand their houses on to their children. There is nothing immoral or wicked about that—virtually everybody has that sort of generation-to-generation motivation. The Chancellor should not underestimate the resentment about the provision that will be felt by the middle class voters whom the Prime Minister is so keen to retain. I believe that the Government should have tightened the gift of reservation laws for inheritance tax purposes. Instead, the new income tax charge in the Bill adds yet further complication to personal taxation for tens of thousands of people and threatens the future of many of our historic homes.
  As we stressed in Committee on the Finance Act 2002, the introduction of the zero corporation tax rate introduced a fiscal distortion that favoured incorporation for small businesses, as opposed to remaining sole traders. As we warned, that led to a massive shift to incorporation, which the Government estimate would cost £420 million in lost tax this year alone. The Government have chosen to tax the distributed profits of small companies, which would otherwise fall within the zero band, at 19 per cent., to deal with that. Again, that will create significant compliance and legislative burdens for small businesses, with complications relating to undistributed prior year profits carried forward, and hit especially the smallest companies, which often find it difficult to retain profits.
  The Law Society commented that the extent and complexity of the provisions are disproportionate to the amount of tax involved. The Treasury Committee stated that it is puzzled about why, unlike other commentators, neither the tax authorities nor the Treasury appear to have anticipated the inevitable incentive to incorporation for small businesses.
  The Paymaster General will remember that she pointed out in Committee that small businesses would not look a gift horse in the mouth. She clearly expected the provisions to encourage small businesses to incorporate, but now we are told that it was not a gift horse after all. Consequently, small businesses now end up with a complex tax charge.
  On another subject relevant to owner-managed businesses, clause 86 seeks to remove the ability of small owner-managed businesses to be held jointly, and the husband and wife to remain taxed on a 50:50 basis. That flies in the face of the provisions that were specifically made in 1990, when independent taxation was introduced. Outside the Finance Bill, aggressive new interpretation of section 660A, universally criticised by the accounting profession, seeks to introduce another stealth tax, to tax as the husband's income dividends from the proportion of owner-managed companies that were historically owned by the spouse. The parliamentary debates and Budget press release relating to the Finance Act 1989 made it clear there was no such intention thus to interpret section 660A.

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  What is fundamentally wrong with these initiatives, essentially designed to extract more taxation from small, owner-managed businesses, is that they impose complicated rules on small businesses, which are costly to administer, potentially penal, and will possibly lead to mistakes. At the end of the day, the earnings are not large. As a constituent wrote to one of my colleagues:
  "I am sick of this Government messing up so many areas of my life. I am fed up with their taxes, anti-family stances and sheer arrogance. They meddle in so many areas where they just do not see the ramifications."
  I am surprised that the Inland Revenue has not previously attacked artificial tax avoidance schemes, which have been widely marketed, well before they have become widely used, and I understand the Government's objectives in the Bill. However, I ask the Chief Secretary to make a commitment that the Government will now publish the prescribed Treasury regulations, mentioned in clause 290, which will define "notifiable arrangements". Without that, we cannot know whether, as the Treasury Committee warned, the arrangements will create undue compliance burdens for taxpayers and their advisers, or undue administrative burdens for the tax authorities. As the national head of Ernst and Young commented, his concerns are that UK businesses should not be put at a competitive disadvantage. I am sure that the Government share that objective.
  I also warn the Government of the dangers of confusing tax evasion and tax avoidance. In those European Union economies where that happens, the outcome has been to make tax evasion socially acceptable. Ultimately, there also needs to be a degree of consent on the part of those asked to pay the taxes levied on them. As the senior partner of Grant Thornton pointed out, many of the Government's problems in their attempts to tackle tax avoidance are of their own making. Moreover, to avoid the new rules imposing excessive and uneconomic burdens on business, they also need to draw a clear line between "offensive" tax avoidance schemes and normal corporate tax planning; otherwise, provisions could have the effect of requiring any transaction on employment or a financial instrument that could have been accomplished in a less tax-efficient manner to be reported. That would impose wasteful time and cost burdens both on business and on the Inland Revenue.
  Clause 298 lacks adequate clarity about when lawyers are bound by their duties of confidentiality to a client and when they will be obliged to report under the new rules.
  It is also notable that, although the Bill contains major anti-avoidance measures, there is a marked absence of Government initiatives to tackle tax evasion and the growing black economy, or for that matter, the £7 billion incorrectly paid out in state benefits as the result of one in five Department for Work and Pensions decisions being wrong, as recently reported by the Public Accounts Committee. Moreover, in the Chancellor's drive to leech the tax system, he might apply his ingenuity to improving the collection of £14 billion of uncollected tax last year, as the recent National Audit Office figures revealed. That partly reflects the growing unwillingness of the rising generation to be bothered with the demands of ever more time consuming, bureaucratic compliance in their private lives.
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  Much the most serious challenges to the UK tax base, however, have come from recent European Court of Justice decisions founded on the principle of freedom of establishment in the EU. The Government have no clear view about what the corporation tax system will look like once all the existing and prospective EJC cases have been decided. The recent ECJ decision in the Delasteyre case applies to British companies and allows UK companies to move abroad without incurring a tax liability.
  Until now, a UK company would be deemed to have made a disposal of assets if it moved to a low corporation tax rate country, such as Ireland, where that represented a major capital gains tax bill deterrent. The Delasteyre case removes this barrier and renders unlawful the new migration charge under clause 48 and schedule 8, thus opening the doors to a Dutch auction of corporation tax rates across the EU. I fear that the Government have done no more than react, with delay and without any overall strategy, to each ECJ decision. We understand the Government's objectives with the UK transfer pricing and UK thin capitalisation proposals in the Bill, but we suggest that the Chancellor note the concerns of the Confederation of British Industry about the huge compliance burden placed on UK businesses and the possible impact of the provisions on competitiveness. The Government should tackle the problem head on in Europe, where it should not be within the jurisdiction of the ECJ to rule on tax issues.
  A full digestion of the 158 pages setting out the new regime for pension savings will have to await the Committee stage. As the Chief Secretary commented, the changes were supposed to reduce the pension system from eight regimes to one, but they create six new systems. Most of the proposals appear generally welcome, but in a long-term territory such as pension saving it is all the more important, in principle and in practice, for changes not to be retrospectively damaging to individuals. When the Conservative Government first introduced the pension cap in 1989, the principle was clearly established that individuals' pension contributions, where they were already members of pension schemes, were grandfathered for as long as they remained in that scheme and employment, or its successor scheme and company. So we believe that it is an important point of principle that such individuals should not be unfairly disadvantaged under the highly complex transitional arrangements that are proposed.
  We also question the Government's apparent reversal of their own measure introduced three years ago to enable women who take a career break to keep up their pension contributions for five years, based on the amounts that they had been earning at the time they stopped work, rather than restricting them to the stakeholder limit—[Interruption.] The Financial Secretary says that that is covered, and I am glad to hear it, but the industry does not feel that that is the case.
  We also have concerns that the 1:20 ratio regime provides substantial tax advantages to members of final salary schemes, while those with money purchase pensions are materially disadvantaged. As we have already pointed out, there is no need in principle for a cap if all employees have to be members of the same company scheme, and if annual contributions and tax-free lump sum withdrawals are subject to reasonable limits. We also wonder whether the new arrangements

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  will provide larger incentives for tax leakage, up to the £1.5 million limit than the Government have anticipated.
  While welcoming in principle effective measures to tackle VAT avoidance, we are worried that clause 20, which tightens up on VAT group relief, will act as a major incentive to banks and other large financial services organisations to sub-contract their back-office functions overseas. Here again, the Government would have done better to tackle the EU VAT problem in this territory head on.
  We understand that the property VAT anti-avoidance measures to outlaw schemes such as those under which the Labour party saved £1 million on the purchase of its new offices in Old Queen street, by treating the acquisition as a business rather than a property, are being discreetly addressed outside the Bill by a separate statutory instrument. However, I am glad to see that the Labour party knows so much about this kind of tax avoidance.
  Next week, we will be addressing more fully the specific Budget resolutions that we voted against, on the Floor of the House. It is extraordinary that the Government should be introducing the costly and complex strip-stamping regime for spirits when, only two years ago, the Chancellor's Budget day press release commented:
  "It was clear from this consultation process that the introduction of tax stamps would have a severe impact on the productivity and compliance costs of the spirits industry … The Government does not consider those costs as proportionate to the benefits of tax stamps."
  We shall look forward to hearing what has changed to make the Government do a volte face, because as far as we can see, nothing has changed.
  The Bill contains a further 51 pages on stamp duty land tax, but fails to address the major distortions now being caused in the residential property market as a result of the Government's stamp duty slab regime. There is a total of six other stealth taxes in the Bill, but after the Chancellor's massive engineered increases in council tax, stamp duty is his second largest stealth tax—[Interruption]. Labour Members might be surprised to learn that stamp duty revenues have risen from £2.5 billion in 1997 to a forecast £9.4 billion this year, and they are forecast to be up another £2 billion on last year. I must point out to the Chief Secretary that those middle class voters whom the Prime Minister is so keen to retain are not happy about what is happening to them on this front, especially first-time buyers who are going to have to find about another £2 billion over the next year in stamp duty.
  The Chancellor's boastful budgetary oratory sits ill with the dreary realities of the Bill and the issues facing the British economy. The once prudent Chancellor has been imprudently profligate in running a structural deficit which might prove to be as high as £50 billion, when there is no slack in the economy. The relative success of the British economy in recent years has been at the price of unsustainable increases in personal and mortgage borrowing, which threatens stability, now that interest rates are rising. The deterioration in Britain's public finances in the last three years has also
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  been the worst in the EU, and taxes in Britain have increased as a proportion of gross domestic product by more than in any other EU country over the past six years.
  In the forthcoming spending review, the Chancellor will not tell us that he will be seeking desperately to put the brakes on out-of-control public spending; nor will he tell us by how much he will be putting up taxation if Labour wins another election. He will not be telling us, either, of his wish for a general election as early as possible, before the risk increases of the economic wheels coming off. Like last year, the reality of this Labour Government is more taxes, more spending, even more borrowing and continuing failure to deliver. The Chancellor's policies are taking Britain back to old Labour tax and spend failure. He has already lost the confidence of much of the business community, and he is well on the way to alienating a majority of British citizens.
  3.25 pm
  Mr. Doug Henderson: I refer the House to my entry in the Register of Members' Interests
  The Opposition parties may not want to face up to it—although the hon. Member for Arundel and South Downs (Mr. Flight) acknowledged it in his third or fourth-last sentence—but the background to this Finance Bill is the fact that Britain has one of the most stable economies in the world. Since 1997, 1.8 million jobs have been created, of which 1.3 million were in the private sector. As we all know from reading our local newspapers, in many parts of the country there are adverts for many more jobs than can be filled. Since 1997, 100,000 extra businesses have been created, and unemployment is now at 2.9 per cent., which is the lowest since 1973.
  That has been possible because we have been able to attain growth rates that were not attainable in recent economic times. Since 2000, our growth rate has been 2.5 per cent., compared with 1.6 per cent. in the eurozone and, significantly, our growth rate has been higher than that of the United States. Why have we been able to maintain that growth rate? In a moment, I shall refer to the past, but it should be clear that if, every time there is an expansion in the economy, it is followed by a quick deflationary effect, there will be instability in the economy which will lead to a lack of confidence and, inevitably, rising prices, higher interest rates and all the other things that help to destabilise an economy. Those have all been avoided in the past five or six years, during which we have had historically stable prices and, consequentially, historically low interest rates.
  I am the first to concede that there is a problem in the manufacturing sector, which has not been able to respond to changes in the global economy as quickly as other sectors, although I think it is now beginning to learn how to respond. We cannot expect always to do things as they were done in the past and to be successful. I am not one of those politicians who say that the Government can come along with a magic wand and resolve the manufacturing sector's problems. What the Government must do is establish the right macroeconomic climate, and the right intervention climate on the micro side—which should be no greater than is

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  absolutely necessary. We are already seeing an improvement in manufacturing, partly because the world economy has experienced more of an upturn than in recent years but also because some of the initiatives taken by the Government over the past five or six years have begun to take effect in businesses throughout the country.
  I do not blame the Conservatives, for we have all been in opposition in our time, but their treatises on the state of the economy suggest that their memories are short when it comes to economic comparisons. That is not a party political point. There are many similarities in the economic performances of Labour and Conservative Governments over the past 30 years or so. I would argue, from a standpoint of partiality, that Labour has a better record—that some of the things we have done have been better—but I concede that many general economic trends have not differed significantly.
  When the Conservatives attack what Labour has done over the last seven years, they fail to take account of a new Government attitude to the economy. They fail to recognise that there really has been change and that the stability that we have struggled to hold on to for any length of time in the past has now been attained. A Conservative party, or any other Opposition party, that does not acknowledge that will not just fail to carry business and the people with it, but discredit its ability to assess economic performance and come up with policies of its own. In a sense, it will let people down.
  When I was a student, Government's role in the economy was to boost it one year and depress it the next, in the hope that over three or four years—given various such cycles—it would be stabilised. That did not happen often and when it did happen, it usually happened by accident. Expectations were not in line with actual movements in the economy. Even when the economy was moving in the right direction. people—be they workers or entrepreneurs—expected things to get worse, and their decisions on wage bargaining or investment policy were based on those expectations rather than on reality.
  I do not think that has changed. I think that is how human beings react. Long-term stability, however, makes it more likely that expectations will be in line with economic realities, which means that people will make better judgments on whether to invest, whether to settle for a certain amount in their wages or whether to save a certain amount. That did not happen in the 1960s or 1970s. Things were more difficult in the 1970s because of the oil crisis in 1973, when we were all trying to cope with a 25 per cent. inflation rate. Under both Conservative and Labour Governments, how could an investor decide where he wanted to be in two years' time when inflation was likely to be 40 per cent. over two years? If the forecast was wrong by 10 per cent., that would mean 4 per cent.—and a company that can register a 4 per cent. profit in its annual returns is doing pretty well. It was very difficult to make investment decisions, which caused further instability in the economy.
  That was repeated in the 1980s, when after a short boom in 1980, the Conservative Government were forced to recognise that it could not be sustained. The huge instability that followed lasted for years, causing massive unemployment and social disruption. It was repeated again in the early 1990s, when the Conservative
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  Government again tried to boost the economy before the 1992 election. I do not blame them for that, but it created enormous instability, with inevitable deflation and massive unemployment. I am happy to discuss that economic thesis with anyone who disputes it, but I think that we have all learnt a lesson from it. There must be a different approach, geared to stability. I shall list some of the things that the Government have done to bring that about.
  Mr. Flight: Does the hon. Gentleman agree that the major change in the past 10 years has been from the forces of globalisation? In the prior periods to which he referred, in more closed economies, inflation could build up more easily, leading to the stop-go cycles that he mentioned. The crucial change, as the Bank of England would admit, is that with open, global economies it is much more difficult for inflation to ignite. Indeed, the Bank of England would argue that the fact that the inflation target has been met has not been the result of a magical ability to manage inflation to that level, but largely the result of international forces. Surely that is the great change.
  Mr. Henderson: I understand what the hon. Gentleman says and recognise that we live in a more global economy, with more interaction between different parts of the world economy. That is the background to what has happened. Without policies geared to stabilisation, however, it would have been perfectly possible, even in an expanding global economy, to have massive stop-go, which would have undermined our ability as an economy to perform. if he looks at some of the examples around the world, he will see that that is the case where economies have not performed in this period of globalisation. One might have thought that the Japanese economy would perform much more effectively in this era, but it has not, because Japan's domestic policies, and the sense of economic integrity in the country, have not been continued over the years. Some EU economies also failed to perform in the way that they perhaps could have, had they been able to achieve greater stability. I recognise that we live in a more globally minded economy, but that does not in itself explain the difference.
  What has changed the economic performance? The basic point is that markets are more confident in their predictions, and wage earners, house purchasers, investors and savers are also more confident. In a sense, stability breeds stability. Some colleagues might argue that all this happened just because there was a Labour Government. I do not argue that, as I implied in my previous remarks. The Labour Government have adopted a change in economic thinking, responded to the changing economy and begun to adopt new approaches. The independence of the Bank of England is an example of that. It would have been heresy for any Labour Member to argue for that in the early 1990s or before. It was recognised, however, that if we are to give markets more confidence—let us remember that markets are not just about capitalism, but about the workers, their expectations and their predictions—people must believe that macro-economic policy has been based on what the economy needs, not on what a political party needs. When we give that degree of

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  independence, while maintaining some influence over the long-term shape of the responsibilities of the Bank of England, we nurture that improvement.
  On borrowing policy, one problem in the past was that, in the 1960s, 1970s and 1980s, many people still lived under the economics of the 1930s. In a less global economy, with massive deflation domestically, public expenditure programmes were necessary to create work. If it was useful work, that was fine—sometimes it may not have been, although most of it was. If we tried to conduct an economy on that basis, with a more globalised economy and a nearness to full employment that did not exist in the 1930s, inevitably, again, expectations would be affected. A crucial reform of the Labour Government was to say that borrowing is for investment over the economic cycle, not for plugging the gaps in revenue except in the very short term. That gave markets great confidence in our economy.
  The social programmes that have been introduced, and the emphasis on expenditure on health, education and so on, have been important in carrying people along with the changes that have taken place. The investment programmes in education, training and science have been important in bringing about the changes, not in the sense of health expenditure, which gives people a belief that things are going well, but because by investing in education we are creating a skill base for tomorrow.
  Those are the main changes that have taken place over the past five or six years that have helped to reinforce the stability of the economy. The Budget this year again does that and I believe that the Finance Bill also provides a fiscal framework for stability.
  Adam Price: I am listening with great interest to the hon. Gentleman, who represents the north-east of England, the economic history of which is not dissimilar to the part of south Wales that I am from. Does he think that the benefits of the economic stability that he describes have been distributed equally throughout the United Kingdom?
  Mr. Henderson: Unemployment has more than halved in my constituency over the past seven years and there are many other improvements that are obvious to the electorate in Newcastle, North that I was going to mention to the House. The hon. Gentleman has just prompted me to do so slightly earlier.
  People can see the social programmes in their communities and that things have changed. In Westerhope—the ward where I live—there is a new primary school that has all the latest technology to encourage a better education for our young people. There are three secondary schools in my constituency. All Saints school is the re-creation of two schools that were failing. It is still a difficult school but it is making enormous strides, and there has been a big investment—for everyone to see—in what is in the classroom, what protects the classroom and the number of teachers.
  In Gosforth high school—I see the hon. Member for Hexham (Mr. Atkinson) opposite; he will know all these places—there has been an obvious investment in new classrooms and essential maintenance of existing buildings, as well as the establishment of a new building.
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  Walbottle school, on the boundary between our constituencies, is to be completely reconstructed, based on the social expenditure that is now possible because of the changes that have taken place in our economy and its strength.
  In West Denton in my constituency, there is a new one-stop community centre in the middle of a redeveloped shopping centre with a wide range of facilities including housing and benefit advice, leisure facilities, work and pensions advice and a new library. All of this is obvious and such changes are replicated in constituencies up and down the country. My answer to the hon. Member for East Carmarthen and Dinefwr (Adam Price) is yes, things have got better and the changes are visible, but there is still some way to go. I do not want to detain the House too long but I would like to mention some of the things that could be done.
  The Budget has addressed the regional imbalance issue, especially in accompanying statements on the dispersal of civil service jobs. Too often, we have located jobs in already congested areas, which does not make economic sense. We have dispersed civil service jobs in the past and we need to disperse more, and that will help to encourage employment and growth in constituencies such as mine in the north-east and that of the hon. Member for East Carmarthen and Dinefwr.
  That will also address, at least partially, the point raised by the hon. Member for Arundel and South Downs about how one reacts in an economy that is getting nearer and nearer to full capacity in many areas. Regional redistribution is an important way of raising the overall level of economic activity and addressing the problems of full capacity.
  People are generally wary of making this point, but I will make it. On immigration, there needs to be far more consideration of the economic factors involved rather than the other factors. Immigration is crucial for economies that are to grow. An economy can be grown to an extent by raising the productivity of the people who are there, but productivity has shot ahead in some economies around the world because more people have been involved. That has happened sometimes because the labour market has grown internally, but it has often happened because of external immigration. If anyone knows an example of where that is not the case, please tell me.
  We in this country must stand up and say that, if we want to continue to be prosperous and meet our economic objectives, there must be an economic context in which we consider such matters as immigration. We all know what happens in London. If there were no immigration into London at the moment, and if there had not been for the past 10 years, there would be no service industries provided in central London. We all know that, so why do we deny it? Some areas of the country now need immigration to ensure that their future capacity is as good as it has been in the past, because areas such as the north-east and Scotland have been losing population. If such areas are to be successful, we need to have a much more progressive approach to immigration. I do not believe that people should just be able to come to this country and pick up what is going, but they should be able to come and make a contribution.

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  That economic argument should be made far more often. If all the political parties accepted that that was the case and did not try to make party political points out of it, it would not only be economically desirable but have beneficial social consequences. I, for one, will not hide from that issue because it is important in economic terms, although I could also justify it in social terms. That does not mean having a completely open-door policy, but we have to allow immigration where it is important.
  I have gone on for long enough, although I could also have identified benefits for small business. It is important to have micro policy to help small businesses, and I am sure that my colleagues will address that in their contributions, as Front-Bench Members have. There is a need to do more on labour mobility, which will also help to address the full capacity issue. Housing policy is crucial in that regard, and the Government's response to the Barker recommendations on housing investment trusts is a good one. I look forward to legislative backing for that.
  On education, the Government's commitment to a 4.4 per cent. real-terms increase during the next four years is crucial, for reasons that I hope everyone in this House recognises.
  Mr. Bacon: The hon. Gentleman has mentioned various points, but I have listened with particular interest to his comments on immigration and his powerful point about services in London. I was struck the other day when, having been served with coffee in Starbucks in Horseferry road by a Brazilian tax lawyer, I then went to the dentist who turned out to be from South Africa, and also saw a dental hygienist from Finland. When I returned to Starbucks later in the evening, a Japanese drama student was behind the counter. The hon. Gentleman is right to say that London services would be decimated without immigration. However, does he agree with Trevor Phillips, the chairman of the Commission for Racial Equality, that multiculturalism—the cultural and social issues are different from the economic ones—has been a failure and should end?
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I had been on the edge of suggesting to the hon. Member for Newcastle upon Tyne, North (Mr. Henderson) that he had perhaps dwelt a little too much on immigration in relation to the main substance of the legislation before us. I certainly hope that he will not respond to the hon. Member for South Norfolk (Mr. Bacon).
  Mr. Henderson: I am pleased, Mr. Deputy Speaker, that you have kept the hon. Gentleman and me in order. I was simply trying to address the full capacity issue, which has been raised and is important.
  The Finance Bill is designed to steer our economy towards higher productivity, in line with the issues that have been mentioned from the Front Bench, including the use of our increased resources to fund investment in education and important social expenditure. Some would say that there is very little in the Budget that changes things, but that is not a crime for a Budget. I do not believe in changing regulations if they do not need to be changed. The important thing is that the macroeconomic strategy is right, and the Budget reinforces that.
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  This Finance Bill will help to maintain stability. It will contribute towards raising productivity in our economy, and it is fair. For those reasons, I commend it to the House.
  3.49 pm
  Mr. David Laws: The shadow Chief Secretary said earlier that the Budget was dull and the Bill too long, and I think that I detected the Paymaster General sighing and saying that we say that every year, but unfortunately of late it happens to have been true: Budgets have been dull for a couple of years and Finance Bills too long for quite a few. We may not be able to do much to influence the dullness or otherwise of Budgets, but it is slightly disappointing that our urgings to limit the length of Finance Bills and the complexity of tax legislation have not been heeded.
  The Paymaster General (Dawn Primarolo): I thought the hon. Gentleman and his party were in favour of the tax law rewrite project, so I would expect him to welcome the resulting increase in the volume of Finance Bills—they are longer, but much clearer, which is important.
  Mr. Laws: I am complaining not about the tax law rewrite but about the Government's policies. We have had further examples this year of their having to fill the Finance Bill with measures to unwind the effects of tax loopholes and reliefs introduced in previous Budgets. The shadow Chief Secretary has already mentioned the corporate tax measures that unwind the effects of the zero tax rate introduced only two Budgets ago.
  We shall have an opportunity in the couple of months that we take to deal with the Bill in Committee to discuss many of the clauses in great detail. Today, I want to focus on the broad sweep of the Bill and the Budget, and to follow to some extent the structure of the excellent report published by the Treasury Committee just a couple of weeks ago—a report that usually informs our debates on the Finance Bill at this stage. I want to discuss the macro-economic background and some of the key public expenditure issues before coming to some of the salient tax issues.
  At the urging of the hon. Member for Newcastle upon Tyne, North (Mr. Henderson), I pay tribute to the Government and those in the wider economy for the unprecedented period of economic growth that we can celebrate this year. Of course, that is essential background to the Budget. The success of the economy and its ability to create jobs is one of the factors that allows us politically to concentrate on issues such as the improvement of public services, which was far less salient in the late '70s, the '80s and the early '90s, because so much of our political and economic debate had to focus on the crisis in the macro-economy, and in particular on the huge level of unemployment. When I was first getting interested in politics, the claimant count was well over 3 million, and it is a great pleasure to note that it has now fallen below 900,000, which would have seemed an almost impossible target back in the 1980s and early 1990s.
  It is a great pleasure for me in my first Parliament to represent a constituency where the major complaint from business is about the shortage of employees.

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  Unemployment is less than 1.5 per cent. in Yeovil—and throughout south Somerset and into Dorset. In fact, the major employment issue that I have to deal with is the controversy that can arise when people from Portugal and other countries are brought into communities such as the town of Chard because there are not enough employees to fill the posts in local businesses. That is a nice problem to have.
  Mr. Steve Webb: I do not want to interrupt my hon. Friend's characteristic slavish adoration of the Government's economic policies, but does he accept that there are many people who do not feature in the official figures? Perhaps he was going on to say that. Among young people, for example, the number who are not in paid work or on a training course, or who have dropped out of education and so on, is basically the same as it has always been. Far too many do not show up in the headline figures, and there is a lot of wasted talent out there that the Government have failed to do anything about.
  Mr. Laws: I assure my hon. Friend that I have dealt with the good news part of my speech so far as the Government are concerned, and I am extremely conscious of the point that he makes. Many fall outside the labour market statistics altogether, and such people—particularly those on long-term incapacity benefit, for example—should be of great concern to the Government. I hope that they are.
  There are two clouds on the economic horizon—the shadow Chief Secretary has referred to them—and they both relate to debt. The first problem concerns consumer debt and the valuation of housing assets, and the second public sector borrowing. Both should be of great concern to the Government, not least because although, as the Chancellor has observed, we have enjoyed an unprecedented number of years of positive economic growth, it is in the nature of history that such periods always come to an end. We should therefore try to anticipate what could bring these benign circumstances to an end.
  One of our greatest concerns, which has been expressed by my hon. Friend the Member for Twickenham (Dr. Cable), is the accumulation of consumer debt and the appreciation of house prices in particular. House prices have risen by at least 100 per cent. across most of the country in the past four years or so. That speculative bubble in the housing market could burst at some stage, leading to a decline in consumer expenditure, which might be over-extended as a consequence of the high level of consumer debt. I do not get the impression that the Government believe that there could be a problem with consumer debt and the housing market, or that there is a pin out there that will burst the speculative bubble.
  The Treasury Committee touched on the issue in a relatively fair way in its Budget report. It is true that a number of the reasons for the increase in house prices and in consumer borrowing are related to fundamental economic factors, which might give less cause for concern than some of the speculative pressures. We have enjoyed relatively strong growth of real incomes, and low unemployment. The increase in house prices
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  perhaps constitutes an adjustment for the fact that interest rates are at a very low level historically. It is probably reasonable to assume that they will stay low for the foreseeable future; at least, that is what the financial markets are saying.
  Some speculative house buying is taking place as people switch their investments from other classes of assets that have not performed well recently, including the share market. That should give us pause for thought, as should the extraordinarily high level of house prices compared with earnings across the country. Since I became Member of Parliament for Yeovil, the price of houses at the bottom end of the market in my constituency has at least doubled. Properties in Chard— a town marked by very low-paid employment—that were going for £45,000 to £50,000 in 1999 are now on the market for £115,000 to £120,000. It is incredible that the lowest priced houses in a town with such low pay should be that highly priced, and constitute so many multiples of average earnings.
  The Government might be aware of recent statistics produced by financial commentators such as Barclays bank. According to a Barclays bulletin, the major factor that pushed up the value of lower priced properties in the past couple of years was not first-time buyers, but a huge explosion in the speculative market for buy-to-let properties. In the past couple of years, the growth in the number of such properties far outweighed the decline that was otherwise taking place in the number of mortgages taken out by first-time buyers.
  The Government may feel that they can afford some complacency at present, and that even if there might be an overstretched housing market there is no obvious factor on the horizon to end the current position—no pin to burst the bubble. However, we cannot easily anticipate an increase in inflation, not only in this country but overseas, perhaps as a consequence of loose monetary policy in several countries. If, as a consequence, there is a significant rise in UK interest rates, the house price bubble might burst significantly, and that might accumulate in its effect as a result of the amount of speculative buying in the housing market. That seems to be a real risk to the economic outlook, which the Government should take more seriously. They should encourage regulators to police very carefully the way in which lenders are dealing with the property market in particular, and continue to support the Monetary Policy Committee in taking early action on interest rates.
  The second controversy and other cloud on the economic horizon is the borrowing problem and fiscal deficit that the Government face. There has been a significant increase in public sector borrowing and the projections for it over the past few years. As the Select Committee report pointed out, that has happened despite the Government's success over the past year in achieving their growth forecast—something that a year ago many of us felt was somewhat unlikely.
  The Select Committee also pointed out that the Chancellor's problem with public borrowing over the past few years has been a consequence of a shortfall not in growth, but largely in tax revenues per pound of economic growth. Commentators are still expressing considerable scepticism about whether the Chancellor's forecast for increasing tax revenues over the next few years will be borne out. If they are not, we will face the

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  serious risk of public borrowing rising significantly above 3 per cent., which has for a long time been the benchmark with which both the present Government and their predecessors have been comfortable.
  I am not sure yet that my forecast would be as gloomy as those of the shadow Chief Secretary and the shadow Chancellor. After all, the figures on potential deficit and excess in the borrowing forecast mentioned by the Institute for Fiscal Studies and others are of the order of only £10 billion to £12 billion—the average error from looking one year ahead on the public finances. No Government should necessarily be proud of that, but it remains the case. If the Government are lucky and the position turns out to be more benign than the forecast, the deficit could disappear very quickly indeed. However, if they are wrong in the opposite direction, the deficit will be even greater than that expected by the IFS, which should give the Government serious cause for concern.
  What should the Government do? One action that they should consider is giving the same type of credibility to their fiscal regime—particularly transparency—that exists for the monetary policy regime. I wish that the Treasury Committee had gone a little further in its recommendations on that point. It has at least pointed out that it is unsatisfactory when the National Audit Office is called in by the Chancellor only to audit particular assumptions and not other assumptions. Problems have occurred recently in the private sector, but if we proposed a system whereby auditors were instructed to examine only certain assumptions and not others—about oil, stocks and so
  forth—people would be very worried.
  Angela Eagle: As a member of the Treasury Committee I can tell the hon. Gentleman that we debated whether the National Audit Office would be in a better position than the Treasury somehow to oversee and audit official statistics, and we explicitly decided that that would be nonsense. We deliberately said that we should go no further than the recommendation and comments in the report.
  Mr. Laws: I am grateful to the hon. Lady for making that point. I recall that debates in the Select Committee have been going on for some time and that several Members—including the hon. Member for Chichester (Mr. Tyrie) and, I suspect, my hon. Friend the Member for North Norfolk (Norman Lamb), who is in his place behind me—have argued forcefully for greater transparency.
  I am not necessarily saying that giving the NAO more power to audit the assumptions is the only option. We could set up an independent body to make an assessment of the fiscal outlook, alongside the independence on monetary policy. As the Government have done so much to clarify the transparency of macroeconomic policy in general. including fiscal policy, it is a pity that they seem to be nervous about going the whole hog towards proper credibility and transparency in fiscal policy. Of course, we all understand why that is: Governments, especially when a general election is coming up, do not want too much scrutiny of their figures by outside bodies. However, the price of not providing that scrutiny is a greater prospect of the Government making errors in their economic policy.
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  That point naturally leads us to public expenditure. One decision that the Government have taken recently on public expenditure and the control of public borrowing has been to limit public expenditure growth in the next spending round, which will be later this year. We agree with the Government that it is appropriate to slow down the rate of growth of public expenditure, even though for many years we argued that they were too slow to increase it, which is but one of the reasons why public service improvement has taken so long to deliver.
  We do not, however, support the Conservative proposal to reduce public expenditure significantly below the rate of growth of the economy, as we do not believe that that would be consistent with continuing to improve the delivery of public services. The reticence of the shadow Chancellor and the shadow Chief Secretary to spell out precisely where the proposed cuts would fall indicates some of the difficult decisions that they would face. We should not be able to rely only on public sector efficiency savings.
  In another extremely fair part of its report, the Select Committee pointed out the difficulty in assessing whether such efficiency savings could materialise. It noted that the Treasury was one of the Departments that recently dumped its target for 2.5 per cent. efficiency savings on the basis that such savings could not be effectively monitored—a point that has also been made by the IFS.
  The Government need to do two things to deliver their agenda for the improvement of public services. First, within that much tougher public expenditure framework, they must make hard choices about where the priorities lie. Rather than relying solely on efficiency savings—although they should always be sought, they are not always as easy to pin down as they are to claim— we believe that they need to make some hard choices within public expenditure totals. My hon. Friend the Member for Twickenham has explained how we would fund much of the health, education and other programmes that we want to be introduced by cutting specific aspects of Government expenditure, including parts of the Department of Trade and Industry budget and the child trust funds; by opening up defence procurement to greater competition; and by reducing some of the excessively wasteful programmes of the Office of the Deputy Prime Minister.
  Secondly, the Government should consider whether increases in public expenditure are really delivering their intended purpose of improving health, education and policing. Earlier, the shadow Chief Secretary mentioned the poor public sector productivity figures released recently and referred to the fact that most of the money allocated to public expenditure appears, from the figures, to have gone into public sector pay and on an explosion of other public sector costs. We are aware that the Government are holding an inquiry into that matter and that additional public expenditure on such things as reducing class sizes or capital investment will not necessarily show up in the productivity figures, even though such spending is much needed.
  My local experience also indicates the challenge that the Government face in delivering public service improvements from increased public expenditure. Perhaps I could draw the Paymaster General's attention to the budget figures for my local hospital—Yeovil

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  district hospital—which have just been released. The hospital also covers part of the shadow Chancellor's West Dorset constituency.
  It is interesting that the East Somerset NHS trust's budget for that hospital will increase from £57 million in the last financial year to £65 million in this financial year. That £8 million is a significant increase—well over 10 per cent. in cash terms. However, let us consider the cost pressures that the trust faces and where that £8 million will go. I can report to the Paymaster General that £3 million will be spent directly on pay inflation, including the funding of the consultants' contract; that about £1.2 million will fund the European working time directive; that £2.8 million will be spent on superannuation; that £1.2 million will go into a capital project to improve the hospital; and that £300,000 will go into non-pay inflation. In another words, almost all that money is accounted for by pensions, pay and a much needed capital project.
  Later in the assessment of the trust's position, it is reported that the funding available for 2004–05 will be insufficient to maintain the waiting time targets set by the Government. That situation, which must be mirrored throughout the country, shows to both the Government and the Conservative party the difficulty of delivering such improvements in public services, not least after a long period in which far too little has been invested in the capital stock of our public services and in which an attempt to hold down public sector pay has created a great number of improvement projects. Those facts ought to draw the Government's attention to the need to reform public services and, in particular, to decentralise those services—to stop trying to run them all from Whitehall and Westminster.
  The last issue that I want to raise is tax. The most important tax measure that we would like to have seen is not in the Bill, and we await an announcement later this year. The Paymaster General may be interested to know that my colleague the Liberal Democrat shadow Chancellor, my hon. Friend the Member for Twickenham—he is not here at the moment, but he was earlier—recently attended the Liberal Democrat conference in Southport.
  Mr. Mark Prisk: What was he doing there?
  Mr. Laws: It is usual for us to attend our conferences.
  My hon. Friend bumped into the Chancellor of the Exchequer's former spin doctor, Mr. Charles Whelan, who was there, in and around the bars and other places. Mr. Whelan gave two pieces of advice to anyone who would listen about how we ought to take on the Government at the next general election. He said that we should focus on only two issues: trust—interestingly enough—and the council tax. Obviously, one questions the commitment of Mr. Whelan and others to supporting the Prime Minister, given that he urged us to focus on those two issues.
  We would like to have heard more than we heard in the Budget—we still await this—about how the Government will reform council tax or, better still, abolish it altogether. We are certainly not impressed—I
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  do not think that the country is either—by the sticking-plaster solution in the Budget: the payment to pensioners of only £100, which does not address the pressures that many people, including those who are not pensioners, face from the increases in council tax throughout the country.
  In the recent Budget debate, my hon. Friend the Member for Northavon (Mr. Webb) quoted figures issued by the Office for National Statistics that show how the tax burden by decile has changed since 1996–97. We should get the latest tax burden figures from the Government in the next couple of weeks, if they are not delayed or mislaid, as they often are. I expect that those figures will continue to show that under Labour the people who have been particularly hit are those in the lowest income deciles. They pay proportionally more of their income in tax than those in the top deciles, largely because of the increase in backdoor taxes—indirect taxes and council tax—over the past few years. The most notable backdoor tax increase has been in council tax, which alone accounts for 12.1 per cent. of the income of the lowest decile, compared with 1.5 per cent. of the income of the top decile. Even after council tax benefit, council tax accounts for almost £1 in every £10 of income of those on lowest incomes. If the Paymaster has not yet picked up on the fact that that is one of the public's biggest concerns and that council tax is the most unpopular tax in Britain, she will do so in a few weeks' time, when she gets out on the election trail for the European elections and any local government elections taking place in her area.
  Simon Hughes: Before my hon. Friend leaves the subject of backdoor taxes, will he assist me and others in persuading the Government to get rid of another such tax, which came to light last week in an answer given to me by the Chancellor of the Exchequer—a tax on charities whose runners commit themselves to raise a certain sum of money in the marathon? That was not clear before last week, and it needs to be corrected and redressed.
  Mr. Laws: My hon. Friend is right. As he has raised the point, I shall deal with it now. I have been assiduously pursuing the points that he asked me to pursue, because he was unable to be present at the beginning of our debate. I asked the Chief Secretary whether in future it would be necessary to pay VAT on the golden bonds that were used by a number of people running for charities in the London marathon. The answer that I think the Chief Secretary gave and that I hope the Paymaster General, who is mouthing at me—favourable things, I hope—will make clear, is that the Treasury would provide clarification and that there was a possibility that people using golden bonds would not have to pay VAT. My hon. Friend has received representations from London Marathon Ltd., which is, I believe, supportive—
  Dawn Primarolo: Will the hon. Gentleman give way?
  Mr. Laws: Let me finish my point and raise a related one to which I hope the right hon. Lady will respond. The chief executive of London Marathon Ltd. has written to my hon. Friend the Member for Southwark,

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  North and Bermondsey (Simon Hughes) pointing out that the company is very supportive of VAT not being charged on golden bonds, but that it is concerned that if the solution pursued by the Treasury is to end the VAT-exempt status of the event, it could end up paying more VAT. Therefore, the company wants confirmation that any solution will not worsen its position.
  Dawn Primarolo: The hon. Member for Southwark, North and Bermondsey (Simon Hughes) was not present at the beginning of the debate and might not be here at the end, so I shall answer the point now. Let me make it absolutely clear, because misleading information has been given, that charitable donations have always been and remain VAT-free. As for the golden bond, the London marathon organisers and director have made it clear in writing that they prefer to charge the VAT because that enables them to reclaim VAT on the significant costs of mounting the event—I understand that almost £800,000 has been reclaimed. We can have a sensible discussion about the matter, but let us not mislead: no change has teen made to the tax rules. The hon. Gentleman, who is standing in another election, is trying to mislead and he should not do so.
  Mr. Deputy Speaker: Order. The Paymaster General could have described her dispute with the hon. Member for Southwark, North and Bermondsey (Simon Hughes) in a more felicitous way.
  Dawn Primarolo: I am more than happy to accept your guidance, Mr. Deputy Speaker, and to suggest that it might be sensible to base our discussion on the facts. Perhaps the hon. Gentleman would like to raise the matter with my hon. Friend the Economic Secretary, so that it can speedily be cleared up to everyone's advantage.
  Mr. Laws: The Paymaster General's clarification was useful. No doubt my hon. Friend the Member for Southwark, North and Bermondsey will have heard her generous offer to take up the issue, and people outside will have heard that they no longer need to worry about paying VAT on golden bonds in future—at least, I think that that is what the right hon. Lady was saying.
  Dawn Primarolo indicated dissent.
  Mr. Laws: It appears that the meeting will be needed. I think that the Paymaster General is trying to have her cake and eat it.
  I am conscious that time is limited, but I have one more issue to raise. We have already discussed the unfairness of the tax system and highlighted the absence of any measures in the Budget and the Finance Bill to address the unfairness of the local government tax system. Our other perpetual complaint about the tax system, especially under this Chancellor, is its complication and the rapid introduction of a series of ill-thought-out subsidies, often without any calculation of whether they will have any economic advantage. There are examples in every Budget under this Chancellor, and in this year's Budget we witnessed die fiasco of the zero per cent. corporation tax rate. The Chancellor had to introduce a new 19 per cent. tax rate this year to try to deal with the problem of lost revenue that resulted from many people incorporating.
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  That fiasco was entirely foreseeable and, indeed, was foreseen by many people who gave evidence to the Treasury Committee a couple of years ago and by the Institute for Fiscal Studies. It was also widely discussed and debated in the House. A year or so ago, I attended an event in my constituency organised by local accountancy groups that were trying to encourage people to incorporate and pointed out the great advantages that the Government had opened up as a consequence of the zero per cent. tax rate. The tax accountants led, as one would expect, with an explanation of how the measure worked in practice and what their charges were. As a political representative, I was asked only one question—that surely the loophole was too good to last and that once the Government realised they were losing revenue they would close it and people who had paid their money to accountancy firms would be no better off. I am afraid that I naively said that even this Government would not be so short-termist and short-sighted as to end the tax relief within 18 months, particularly before a general election.
  That is the last time that I shall defend the Treasury's long-termism, as business men now ask me how the Government could change their mind so rapidly. Under the Bill, the Government will raise almost £1 billion over the next couple of years by withdrawing all the reliefs that had previously been introduced. It would have been far too embarrassing, however, for the Chancellor to have to announce in the Budget that he was withdrawing the zero per cent. tax rate. That would sound like an anti-business measure, so he presented it as a further reform to stop tax avoidance. The introduction of a new 19 per cent. rate will further complicate the system and, as a result, the tax accountants who were at that meeting will earn even more money from people going back to them for advice.
  It is not for me to suggest how the Government can get out of the mess that they have got themselves into, but I shall make a constructive suggestion before concluding my speech. The Government will issue a discussion paper on the tax rates paid by incorporated and unincorporated smaller businesses later this year, and it will lead to changes in 2006. We do not want people to adjust to the latest change in the tax regime, only to be messed around again in 2006 when the Government change the whole system. The Government should aim to put off that penal increase in taxation. They should accept that the loss of tax revenue is their fault and was entirely predictable. They should not introduce changes in the tax system for small businesses in 2006 until they have thought them through.
  It was fair to characterise the Budget as somewhat dull and the Finance Bill as long. What is not in the Bill concerns us, and should concern the Government too. There is nothing about the fairness and simplicity of the tax system, nothing to address the public expenditure issues facing the Government, and there is complacency about the major macro-economic challenges facing them.
  4.24 pm
  Angela Eagle: It is a pleasure to follow the hon. Member for Yeovil (Mr. Laws), and I welcome his welcome for the success of the Government's policies, particularly their effect on the

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  labour market, an area that I shall address in detail. His thoughtful speech, observations and interventions were more constructive than those of the hon. Member for Arundel and South Downs (Mr. Flight), which consisted of more scaremongering about imminent economic collapse. Every year when we debate the Budget and the subsequent Finance Bill, the Conservatives predict economic crashes, mayhem about to come and recessions made in Downing street—phrases with which we are so familiar. They have done it in debates on every one of the Chancellor's eight Budgets to date, and they have been proved wrong every time. I suppose that, like a clock that has stopped, they hope they will be correct at least twice in the next period. A stopped clock is correct at least twice every 24 hours, so they hope that sooner or later they will be accurate, but there is no sign of it yet. The Chancellor's institutional reforms may mean that stability is here to stay, as the hon. Member for Yeovil and my hon. Friend the Member for Newcastle upon Tyne, North (Mr. Henderson) said.
  Behind all the complexities of a Finance Bill as long and technical as this one—it has 309 clauses and 40 schedules—lie a few simple core values and aims, which are central to the task that the Government and the Chancellor have set themselves: to establish a strong and stable economy, and to use that as a platform to create the conditions for a fair society that provides opportunity for all and security for all. Opportunity may be jobs or the social programmes such as those that my hon. Friend the Member for Newcastle upon Tyne, North noted in his constituency. I could give a similar litany of positive developments in my constituency. Security for all may be the anti-poverty programmes that the Government have successfully launched and which they continue to strengthen and improve, or fairer access to improving public services such as health and education.
  Those core values and aims can be seen running through the Bill like a seam of precious metal running through rock. The Bill resembles a wall of granite, but there are important gems in it that we need to take some care to identify, understand and retrieve from the morass of technical detail with which we are always faced when we look at a Finance Bill.
  The Government's economic record is a major achievement. We have had an unprecedented period of stability, sustained by a bold institutional change that the Conservatives opposed, although they have now changed their minds. We have had astute stewardship of economic affairs, which has enabled the UK to navigate a treacherous international climate that has included economic shocks such as the Asian crisis, the Russian collapse and the high-tech bubble, all of which we have come through unscathed, whereas in previous eras we may not have been able to ride such rough waters unscathed.
  Steady growth and stability have enabled Britain's torn social fabric to be patched up. It is good to see again, represented by some of the topics covered by the Bill, that work has begun to recreate that torn social fabric and put it back together in a way that will allow
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  it to stand the test of time and once again guarantee security and fairness for the vast majority of the people of Britain.
  There are many features that I could highlight in this Second Reading debate that have contributed to the generally successful economic picture that the Bill further promotes. Macro-economic stability has been mentioned in many of the contributions so far, and I am sure it will continue to be a theme, characterised by low inflation, low interest rates and a much more predictable environment in which individuals and companies can plan ahead. The promotion of enterprise, innovation and science is creating the best prospects for future developments in the economy so that we can maintain our general economic excellence and survive in a competitive world market. The increase in fairness that we have seen in our society in recent years is characterised by the Government's determination to tackle child and pensioner poverty, and the poverty of ambition and opportunities that have blighted so many of our fellow citizens in times past.
  The ongoing major investment in our public services is often commented on—it is derided in some quarters—and Labour Members welcome it. After many years of neglect, our public services and infrastructure need renewal, and it is to the great credit of the Chancellor and the Government that they have managed to put aside substantial sums to invest in those important areas. It is clearly vital to ensure that every penny is spent as effectively and efficiently as possible, which is why I welcome the Chancellor's review of public sector productivity. I also welcome the efficiency reorganisations in the machinery of government announced in the Budget.
  I shall focus on employment and the labour market, and show how dry economic indicators translate into transformed lives and new opportunities for my constituents in Wallasey and the millions of others in the UK who have benefited from the success of the Government's labour market policies, which will be strengthened by some of the clauses in the Bill.
  If the Government's economic strategy has succeeded, their employment strategy has succeeded even more—indeed, unemployment has disappeared from the political equation in a way not witnessed for the past 40 years. The statistics are extraordinary: the latest figures from the Office for National Statistics show that 74.9 per cent. of the working age population participate in the labour market—the highest ever rate—and that an extra 183,000 people were employed in the last quarter. Overall, an extra 1.8 million jobs have been created.
  Under the International Labour Organisation definition of unemployment, unemployment declined by 33 per cent. in the last quarter and now stands at 4.8 per cent.—the lowest rate since records began. As the hon. Member for Yeovil fairly pointed out, the claimant count is less than 900,000, the lowest level since September 1975. On top of those excellent figures, more jobs and job vacancies are being generated. The number of jobs has risen by 114,000 to 30.31 million—the highest figure since records began—and job vacancies have increased by 31,000 over the past year.
  In my constituency, the figures are just as heartwarming. In 1997, Wallasey was burdened with 4,450 people on the unemployment register. In 2004, the

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  latest available figures show that the total is down to 1,983, a fall of 55.4 per cent. since the Government took office. Overall, 5 per cent. of the working age population in my area are unemployed, which is close to the national average. In the Conservative years, the figure hovered between 10 and 11 per cent., and it was consistently twice the national average. Furthermore, youth unemployment has been virtually eradicated in my area.
  Those figures illustrate an important point about economic growth, which partially answers the question asked by the hon. Member for Yeovil about whether growth has been distributed equally. The answer is that the distribution of growth has assisted those regions that have fallen behind in the past, but there is more to do. Between 1997 and 2004, the narrowing of the employment gap between north and south was faster than average in some northern areas—that is certainly true of the north-west, Yorkshire and Humberside, Wales and Scotland.
  Underlying those figures are issues that some of the provisions in the Bill begin to tackle. In my area, for example, the 5 per cent. unemployment rate hides the difference between genders—there is 6.8 per cent. male unemployment and 2.7 per cent. female unemployment. That reflects the economic legacy of the area; its shipbuilding and maritime background created a pool of men in their 50s who spent a lot of time working in heavy industry and have not yet found a place in the employment market in this new phase of job creation. Thankfully, the Budget and the Bill concentrate on that problem.
  Another regional issue is so-called gross value added, which will be considered by the Select Committee. Regional variations in productivity demonstrate that although employment in some of the northern regions has caught up faster than the average and the north-south gap has narrowed, the opposite has happened in terms of gross value added. We must ensure that we are able to create high-quality, high-value-added jobs in the regions. Again, I am happy to say that the Bill and some of the Budget documents contain good signs that the Chancellor is aware of that issue.
  Adam Price: The hon. Lady usefully highlights the key problem of the productivity gap between the economic regions. Does she agree that it would be useful if the Government developed a regional perspective on science, technology and research and development policy?
  Angela Eagle: The Select Committee will consider those issues, and I hope that we will be able to give the House a detailed report. In principle, the establishment of the devolved Governments and, in the English regions, of regional development agencies and, possibly, devolved assemblies shows the way in terms of creating institutions with a regional focus to deal with local issues. Sometimes, disparities in productivity, wages and employment levels within a region are even wider than disparities between different regions. Fairness and equal opportunities must apply more effectively throughout our whole economy.
  The first phase of labour market policy is encompassed by the Chancellor's extremely good record on employment creation, which has increased the
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  number of jobs in the economy and banished the scourge of persistent mass unemployment that did so much damage in the Conservative years. The next challenge is to refine, deepen and improve our labour market policies to take account of some of the issues of quality, access to opportunity, high productivity and high-wage jobs throughout the country.
  If we look at how those achievements have been gained, we see the way forward in terms of deepening our labour market policy to create more fairness. We should applaud the role played on the demand side by the generally stable macro-economic conditions that have allowed jobs to be created in record numbers—and, incidentally, saved some £3 billion annually in unemployment benefit payments, which is now being put to far better use. We should also applaud supply side reforms such as the introduction and increasing of the national minimum wage and its extension to 16 to 18year-olds.
  The tax credits system has helped millions of people, as has the national minimum wage. Facilitating self-employment is important in the context of the new diversity of employment issues. The new deal has also been an effective instrument on the supply side. Together, those measures have made work pay and removed the practical and psychological barriers to the labour market that many people who had been excluded from it experience.
  We now need to introduce the second phase of our labour market policies. We must deepen and strengthen them and move entirely from the understandable initial concern with the quantity of the jobs created to focus on their quality. We must concentrate on facilitating moves from low skilled work to higher skilled and higher paid work, which adds more value to the UK's economic performance overall and creates a fairer and more equal distribution of opportunity and income.
  The Bill's enabling clauses facilitate the gear shift from the quantity to the quality of jobs. For example, on the supply side, clauses 25 and 26 maintain a low tax regime for businesses, enabling them to continue to focus on creating more employment, which is also, hopefully, quality employment. Clause 78 makes child care vouchers tax relievable, which enables the enhancement of lone parent job prospects. Clause 79 allows employers to invest in their employees' skill acquisition by loaning them computer equipment without tax liabilities. That helps to upskill employees.
  The measure provides for increases in capital allowances for small businesses that wish to invest in plant and machinery, which would enhance skills or value added by re-equipping the existing plant. There are many other tax incentives on the supply side and my right hon. Friend the Chief Secretary outlined some of them in his opening remarks. They will create a more benevolent environment for investment in highly skilled, quality employment.
  On a broader scale, the Budget documents contain more detail about the new deal for skills, which strengthens learning opportunities for many people who are currently without NVQ level 2 or equivalent qualifications. The new deal has done a remarkable job in removing barriers to work from those who were disadvantaged in the labour market. Clearly, it should not be abolished, as the Conservative party wants, but

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  broadened and refined to assist those who continue to face barriers to employment to take the plunge and get into work.
  The recent skills strategy paper, with its welcome focus on upskilling for the low skilled and the expansion of the employer training pilot, which was announced in the Budget, will help to bolster the drive for quality jobs. I should like the pilots to be extended countrywide as quickly as is practicable.
  I welcome the Budget's focus on policies to get economically inactive people who want jobs back into work. Achieving an increase in employment and opportunities for disadvantaged groups in the labour market is key to our approach to fairness and equal opportunities. The new disability rights Bill, which will be introduced soon, will assist disabled people. Equal pay provisions will assist lone parents who have child care and continuing tax credits. Ethnic minorities need equal access to training and skills opportunities and protection against discrimination when they enter the labour market. Much remains to be done on that. People who are over 50 face discrimination in the labour market and the protections against age discrimination, which were agreed in the European Union, have yet to be implemented. The low skilled clearly need to be assisted through an enhanced skills agenda to set them on the road to higher paid, more productive employment.
  I welcome the welfare reforms that were announced and covered in some detail in the Red Book. They facilitate the move to sustainable work and opportunities for those who have been inactive through disability or illness.
  The experience of work, work-life balance and rights at work have been equally important in improving the quality of jobs and opportunities, which in turn will make our economy more productive. It is also important that, in areas where there are still problems of discrimination, self-organisation and strong trade union organisation allow people to fight low pay, arbitrary treatment or bullying in the workplace. I therefore welcome some of the moves that have been announced recently on freedom from bullying campaigns.
  The next phase for Labour's employment policy should involve a deepening of quality in the labour market, and a deepening of rights, opportunities and chances. I am glad to say that, judging by the announcements in the Budget documents—particularly on the skills agenda and on some of the supply side issues that I have mentioned—the Chancellor and his Treasury colleagues are well aware of the need to proceed in that direction. We have solved the problems relating to the quantity of jobs in the economy; we now need to focus much more on quality.
  Labour market flexibility should mean a highly skilled work force who are adaptable, ready to retrain or move, and eager to work. It should not mean a casualised, low-paid, alienated work force with no rights and no commitment to an employer. The Bill and the Budget have recognised that basic truth and begun to put in place the policies that we need in order to ensure that flexibility means good, high-value opportunities and well-paid jobs that will benefit our economy and our levels of social justice and prosperity.
  4.46 pm
  Mr. Quentin Davies: I should like to start by reminding the House of my interests recorded in the Register of Members' Interests, although I cannot for the life of me think how they would be in any way relevant to what I am about to say.
  I thoroughly agree with the hon. Member for Wallasey (Angela Eagle) about the problem of age discrimination in the job market and in the health service. I have twice introduced ten-minute Bills designed to address that problem—once under the Major Government. I think that I was the first Member to do so on either side of the House, although several people have picked up the cause since then. I once received an answer from the present Prime Minister at Prime Minister's Question Time saying that he intended to legislate on the subject. I am afraid that that was just one more broken Labour promise, but I am glad that at least I have one ally on the other side of the House.
  I want to make three points today. Two of them go to the heart of the Government's fiscal and economic policies, although the one that I shall start with is important, even though it might strike some hon. Members as a strange matter for me to talk about. However, it is a matter of public interest and something should be said about it. I want to talk about the Red Book—or the white book, as it has now become; perhaps we should refer to it as such. It has always—not just in my time, but for generations—been the foundational document for discussions in the House on the Government's fiscal and economic policy and the relationship between fiscal policy and the rest of the economy. It is foundational not only for our discussions in the House; it is the only document that is readily available to the public—to those who send us here, who pay their taxes, who take an intelligent interest in what is going on and who want to have the relevant facts and figures to hand.
  I am worried about the increasing politicisation of that document, and about the declining standard of the presentation of the facts in it. When I first came into the House, the Red Book, as it then was—it was genuinely red in those days, although that does not matter—was a document that simply set out facts in a dispassionate, even austere, fashion. That has been true for many generations under Governments of both parties. There were no gimmicks or politically loaded phrases. There was no political rhetoric of any kind. The book is now full of PR-speak, value judgments and loaded words. There is a great deal about fairness for all and high-quality public services. That is about the most politically controversial statement that can be made at present— whether our public services really are good value—and it is quite inappropriate in a document of this kind.
  More serious still, while there is a clear tendency to make historical comparisons with 1997–98 when they seem favourable to the Government, where the facts or the historical indices would clearly be unfavourable to the Government or would raise embarrassing questions about Government policy, no figures are provided—at least not in the context of comparisons with 1997–98.
  This is, or ought to be, of importance to the whole House. It will certainly be important to the public, and it should be important to Treasury officials who serve the public and whose interest must be in the good economic

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  governance of the country, and hence in maximum credibility for our fiscal policies. They should be sure to resist any political pressures when putting this document together, and in my personal opinion the spin doctors should be locked out of the building.
  Mr. Nigel Beard: It is easy to make general accusations about spin, corruption and so on. If the document is as full of inaccuracies as the hon. Gentleman pretends, can he give us two examples?
  Mr. Davies: I was about to do so. The hon. Gentleman should exercise a little patience. I intend to be very specific. I do not need to go into all the political rhetoric, some of which I have already referred to; what is important is the presence of omissions—lacunae— and one instance of quite egregious distortion of the facts, or confusion about reality, which certainly should not appear in a document of this kind. I should have thought that the hon. Gentleman would agree with me about that striking omission.
  There is nothing about aggregate savings in the economy. It is impossible to know what portion of our gross domestic product we are collectively saving. What we can learn about is the extent of the Government's "dis-saving"—their negative contribution—because the figures for their borrowing, or fiscal deficit, are in the document. There is also something about the rate of saving as a proportion of disposable income, the so-called savings ratio, but we are not told what the level of disposable income is. There is a numerator with no denominator. Nothing in the document tells us what household savings amount to. Nor is there anything about the corporate sector: it is possible to read the whole document without knowing whether it is a net saver or a net borrower.
  How is it possible to have an intelligent discussion about fiscal policy and Government borrowing without knowing what are the counterparts of that borrowing? Who are the lenders, and who are the savers? The Government are borrowing—we know that—but who are the potential lenders? Is the private sector a lender? The savings ratio is clearly very low: the household sector is saving on a net basis. I shall say how low it is in a moment. The corporate sector we simply do not know about. If we want to find out about the fourth relevant variable, the balance of payments on the current account—the extent to which we are importing capital—we discover that the figures are presented in an extraordinarily confused, confusing and potentially misleading fashion.
  There should be a figure for aggregate savings, and clear flow of funds charts showing the position of the household sector, the corporate sector and the Government. I hope that someone is listening, and will ensure that that is done next year.
  There are no historical indices for savings. As the current savings figure is not mentioned, I suppose it is not surprising that there is nothing about past savings. Nor are there any historical comparisons relating to the savings ratio, although a figure of around 5 per cent. is given for the current household savings ratio on page 232. I am glad to see that the hon. Member for Bexleyheath and Crayford (Mr. Beard) is following the
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  book conscientiously. Again, therefore, anyone reading this document will be completely unaware that less than 10 years ago—seven or eight years ago—the household savings ratio was double that rate at 10 per cent., which was probably the average for the previous 40 or so years. To present the current savings ratio with no sense of whether it is increasing or falling, or of how it relates to the historical trend, is an extraordinary state of affairs, and does not give a clear picture of the position to the public, for whom the document is, I imagine, designed; certainly, the public will have paid for this document.
  There is also no figure for household debt. If the Paymaster General would like to intervene on me and tell me that I have missed something—admittedly, it is a long document—of course I will give way to her. I could not find any figure for household debt at all. On page 232, it says that the level of household debt in January this year has increased by 13 per cent., in relation to January 2003. Just giving the percentage increase without the underlying level does not help us much, however. One must wonder why the household debt figure is concealed in this fashion. Why is such a selective percentage increase figure given without the underlying aggregate being revealed? The only possible reason is that it is extremely embarrassing to the Government. That goes to the heart of the integrity of the document and the extent to which it is either a vulgar piece of political propaganda or a piece of professionally presented disinterested information, delivered by Her Majesty's Treasury to the great British public.
  Another matter of great concern is business investment, which we discuss a great deal in this place, and which is always an important part of the national accounts. In any presentation of the national accounts in any other country, I am certain that we would see a figure for business investment. The only way that we can work out business investment from this document is to look at the graph on page 235. If the hon. Member for Bexleyheath and Crayford follows that graph, he can then try to read off business investment. By the way, he will see that it has fallen by about 20 per cent. over the last seven or eight years as a proportion of GDP. There is no absolute figure, but we can, if we want to take a long time, work out roughly the absolute figure, because there are GDP figures elsewhere in the document. When we work out that figure, we find something that is unfavourable to the Government, and a negative part of their record, but it has been concealed by the spin doctoring of the document, which, I repeat, is highly regrettable.
  Mr. Calum MacDonald: Will the hon. Gentleman give way?
  Mr. Davies: Perhaps the hon. Gentleman will tell me that I have missed the figure for business investment, and he will tell me where it is in the document.
  Mr. MacDonald: I am sure that the hon. Gentleman is sincere in his concern for the statistics in the Red Book. He was a Back-Bench supporter of the previous Conservative Government, who, as he will be fully aware, distorted, manipulated and changed unemployment statistics over a long period, which was reflected in each successive Red Book. Is he trying to

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  draw a parallel between the spin doctoring of that time and whatever errors and omissions he might perceive in the Red Book today?
  Mr. Davies: I was a frequent but not an invariable supporter of the previous Conservative Government. I voted against that Government on one or two occasions. One occasion was in relation to the Scott report, when the issue was the integrity with which information was made available to the public. I hope that the hon. Gentleman will give me credit for that. It would be depressing, in any democracy, if he were to feel that an effective and full explanation for any bad conduct by a Government is that the previous Government were equally or almost equally bad. Is that really the basis on which he feels that he can go proudly to his constituents and say, "This is the wonderful democracy in which we live. This is the standard of conduct to which I subscribe, and the measure that we should set as to how effective the Government whom I support are." Is that really his message this afternoon? If so, I will give way to him again, and he can expand on it.
  I said that there was one matter that was even more serious than the issues that I have already raised, which are themselves pretty serious. We move beyond simple omission of awkward facts into technical incompetence, which is a serious charge to deliver against Her Majesty's Treasury. I hesitate to say it, but the alternative—a deliberate attempt to mislead—is even worse. I am referring to the way in which the balance of trade and balance of payments figures are presented in the document.
  I invite the hon. Member for Western Isles (Mr. MacDonald) and other colleagues to look at page 237 and the pages that immediately follow. The balance of payments and balance of trade are important aspects of economic policy. The balance of trade is a major aspect of the balance of payments, which represents the import of capital, which is relevant to fiscal policy as it is one way in which the Government can fund their deficit in the absence of substantial domestic savings.
  Trade in goods and services is set out on page 237 in table B7, which, for 2004, refers to a deficit of £35¾ billion. If the hon. Member for Bexleyheath and Crayford turns to page 241, he will see the breakdown of gross domestic product and its components. For the sake of time, I shall refer again to 2004, but the same distortion runs through other years. The hon. Gentleman will see that export of goods and services amounted to roughly £286 billion and imports were roughly £332 billion. Even I can do simple arithmetic and work out that the gap, the trade balance, is £46 billion. The figure four pages earlier showed the trade balance to be a deficit of £35¾ billion; there is a significant discrepancy.
  A third table adds to the confusion; the one to which I have referred that is the only source in the document of the current account balance. The Government are obviously embarrassed by this as well. The current account balance is buried; one never sees it in a table. The figure is never mentioned in the prose and one must read it off a graph in chart B8. For 2004, the figure is roughly minus 3 per cent. of GDP. That is roughly
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  £30 billion, which is probably the accurate figure. Slightly below that, one can see the goods and services deficit, which is about £30 billion. That is inconsistent with the other figures.
  There are only two ways to view this. It could be a matter of incompetence, which certainly could be the case if the figures were put together on a different technical basis. There is no such explanation in the document, so there is no way for anyone to see whether the figures are not comparable because the methodology of calculation was different. If one did that in an undergraduate essay, a red line would be put through it; it would be torn up.
  The other possibility I leave to the imagination of the House because I do not want to use epithets that would be unparliamentary. I hope that that is taken account of. I repeat; this goes to the heart of the integrity of the document and therefore the integrity and credibility of fiscal policy, which is extremely important for stability and investor confidence, things that we all hold dear.
  My two other points go to the heart of the policy issues behind the Budget. The first has been made clearly by my right hon. and hon. Friends on the Front Bench over the past few weeks; the Government are spending too much, taxing too much and, above all, borrowing too much. We can See the borrowing figures in the white book, as I call it. In view of the differences in the standard of production of the white book from the old Red Book, perhaps it is a good thing that it should have a different cover. It is probably inappropriate, however, that it is white. The white book makes it clear that borrowing this year is £37.5 billion.
  As my right hon. and hon. Friends have said, that is a significant increase in total public debt, which will have to be paid for through future taxes. The Government are very coy about that. I should have thought that Ricardian equivalence was one of the most venerable, tried and tested, and uncontroversial concepts in economic science. I do not think that there is any scope at all for arguing that borrowing is anything other than deferred taxation, but I notice that the Government are always coy about that and will not come clean. They should come clean, in the interests of open government, and explain to the British people that that money has to be repaid and is deferred future taxation. It is the liability of the taxpayer, and £37.5 billion is a serious increase in that liability.
  Let us just take the interest charge on that figure, quite apart from the capital sum. If the gilt rate is slightly less than 5 per cent.—I do not know exactly what it is, but it is probably about 4.7 or 4.8 per cent.—we can easily work out that, in broad-brush terms, the interest charge on £37.5 billion is slightly less than £2 billion. Every year from now on, we will pay nearly £2 billion, just to service one year's increase that this Government have made in the debt.
  What is £2 billion? I can give an immediate comparison: it is exactly the yield from capital gains tax. In my view, that is the most economically damaging tax of all. It is a direct tax on risk taking and on capital mobility, and we should not have it at all. It is a disaster, and we certainly should not have long-term capital gains tax. I have argued that for many years, but we could dispense with the whole thing if only we did not have this additional incremental interest charge. I am not talking

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  about the deficit, just about the interest charge that the Government have piled on the taxpayer's back as a result of this Budget.
  That is a serious matter, but I am coming to more serious ones. The figures in the white book make it clear that the Government have lost control of fiscal policy, on their own measure. What is that measure? The Government came to power saying that they were going to be fiscally prudent, and they had two rules. The golden rule is that the deficits and surpluses should balance out over the cycle, and the sustainable debt rule is that debt should not exceed 40 per cent. of gross domestic product. There is a quirk, however, because the golden rule excludes investment spending. When the Government borrow to spend for investment purposes, that is excluded from the golden rule, so the fiscal policy stance was always going to have an expansionary bias. The Government were always going to be borrowing more than was required simply to have a neutral fiscal effect on demand through the cycle.
  Let us look at the Government's expression of their fiscal policy aims, which are set out on page 35. I agree totally with this objective, which is entirely laudable:
  "The golden rule is set over the economic cycle to allow fiscal policy to support monetary policy in maintaining stability through the operation of the automatic stabilisers."
  In plain language, those automatic stabilisers mean that the Government should run a surplus when the economy is expanding above trend—above the level that is sustainable without incurring risks of inflation— and that there should be a corresponding deficit when the economy is running below trend. In other words, when there is an excess of demand from other sources in the economy, such as consumption, investment and exports, the Government will compensate by taking demand out of the economy through running a surplus; and vice versa.
  That is a simple principle which makes complete sense. A fiscal policy conducted on that basis does indeed support monetary policy, which now has an inflationary target, in preventing the economy from expanding or declining excessively. That is very sensible and means that the Government act as a kind of cushion.
  That principle, however, is not being followed. According to the Government, the economy has been expanding roughly on trend over the past year, at 2.5 per cent., which is the Treasury assumption for a sustainable non-inflationary rate of growth Furthermore, the projection for this year and next is that it will run substantially above trend, at 3.5 per cent., so if the Government were sticking to their policy, one would expect a Government surplus; but in fact, as the figures in the white book show, borrowing for the past financial year was £37.5 billion, and it is projected to be £32.9 billion in 2004–05 and £30.6 billion in 2005–06. The Government are financing a deficit of £30 billion even with the economy expanding substantially above trend.
  I repeat that the Government's prudence is only half prudent, because they apply the golden rule in relation to current but not investment spending, so it would be fair to consider the borrowing required to finance the current deficit, which should indeed follow the golden rule. In 2003–04, with the economy growing on trend, the current deficit was £21.3 billion; in the current
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  financial year it is projected to be £10.5 billion; and in the next, £5.5 billion. That is assuming, incidentally, that the Government have got their projections right and do not yet again, as they have consistently done over the past few years, substantially overrun their spending and borrowing estimates.
  On the current deficit, by their own measure, the Government have completely lost control of fiscal policy. With the economy growing a whole percentage point above trend, far from there being the surplus that they say there should be, there is a significant deficit, which continues to 2005–06, which is where their projections come to an end. That is not allowing
  "fiscal policy to support monetary policy in maintaining stability through the operation of the automatic stabilisers."
  That is going in the opposite direction and destabilising the economy. Far from supporting monetary policy, Government spending and borrowing are creating a burden on the Bank of England's Monetary Policy Committee to compensate for the excess demand contributed to the economy by the Government themselves when demand from other sources is also above trend. It is the exact reverse of their stated policy. That is why I say advisedly that fiscal policy is out of control, on the Government's own measure. We should all reflect carefully on that.
  The Government expect to hold an election next year, and they hope that the chickens will not come home to roost before then and that they will get away with it. We understand that calculation, but for anyone who pays taxes or is concerned about the economy and about stability—that wonderful word that the Government love using—it is a matter of considerable anxiety.
  As I have said, it is clear from the white book that the Government are very embarrassed about the subject of savings. It contains no figures on the subject, except for the current savings ratio—the proportion of household disposable income saved—which is 5 per cent. The blatant and very important fact that the savings ratio has halved in the past seven or eight years is completely disguised in the white book, which remains entirely silent on the subject.
  Does it matter at all if savings fall? It is clear that the Government do not want to address that question. I suppose that the textbooks will say that savings are important to the economy because they provide the resources for investment. However, I am not concerned about that. In any case, the British economy is not investing enough. As I have pointed out, business investment has been falling. Firms are currently very liquid and we live in a world of open capital markets. If they need to, businesses can borrow from abroad; indeed, we already have a significant current account deficit. We are already importing capital to the tune of £30 billion, or whatever the real figure is. We do not know because the Government have fudged their presentation of it in the white book.
  If British business wants to start investing again and to increase the proportion of gross domestic product represented by business investment—I hope that the Government share that objective, at least in their more responsible moments—and if households are saving very little and the Government are borrowing a great deal, such borrowing will have to be done at the expense of the current account. We shall have to import that

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  money from abroad, thereby building up foreign liabilities. That is an arithmetical certainty, given the situation we are in, but that is not my main concern about savings.
  The one concern about savings that I certainly do share is that if the British people are saving only 5 per cent. of their disposable income, they are simply not providing sufficiently for the hazards of life and for their retirement in particular: for the time when they will no longer have an income from work. We should all be concerned about that, particularly in the narrow sense of our role as taxpayers, because here there is an implied liability. If people are not providing through their own savings for the hazards of existence—unemployment, businesses going broke in a recession, retirement and so forth—ultimately, they fall back on the state. They say, "Well, the state has to keep me at an acceptable standard of living because this is a civilised society and I cannot be allowed to starve on the street." However, we should all recognise that, if we want a happy, successful and stable society, we need a decent level of savings.
  What is a decent level of savings? I concede that that must be a matter of judgment, but in the 1980s and 1990s, when this country had a 10 per cent. savings ratio, no one said that we were saving an excessive proportion of our disposable income. Indeed, even back then, ours was the lowest savings ratio in the European Union and one of the lowest in the world. Typically, abroad, savings ratios were well into double figures, and in countries such as Japan, the figure was over 20 per cent. So there was no suggestion that 10 per cent. was a particularly high figure, yet we have halved it in seven or eight years. Is that not a worry? We should reflect on that point. It is the height of irresponsibility, frivolity and cynicism for the Government to try to close down debate on this issue altogether by disguising the figures and keeping quiet about them in the white book. That is a very bad day's work by them, and they should be thoroughly ashamed of it.
  I turn to the real problem in relation to savings and the issue that concerns me most of all. What happens if one halves savings by reducing them from 10 per cent. to 5 per cent. over seven years? Enormous resources for consumption are released, and we have indeed had a consumer-led boom. As we know, in the past seven years the source of demand has been largely consumption; followed, of course, by Government spending. The Government have concealed the figure for household debt—it is not in the white book—but it is at an all-time high.
  So we have had this great consumer boom and the Government are reaping the political rewards, probably congratulating themselves on how wonderful it is and aiming to maintain it until the next election, when all will be fine and dandy. There will be a feeling of general well-being in the country because of the boom, but only at the expense of enormous debts—household debt, Government debt, the implicit liability of households to pay off the Government debt in future, rises in taxation and so forth.
  Robert Lucas won a Nobel prize for discovering the law of rational expectations, but perhaps rational expectations will not work out 100 per cent. and
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  somehow people will not work it all out effectively before the next general election. The Government certainly hope that they will not, which is why they are cooking the figures in the manner that I have described.
  If we have had an enormous consumption-led boom through the halving of the savings ratio from 10 to 5 per cent., what do we do for an encore? When the Government are re-elected, are we to go down to a zero savings ratio and subsequently to a negative ratio? It is not possible theoretically to have a permanently negative savings ratio, so what are the Government going to do for an encore?
  Another question to focus on is what happens if the British public come to the conclusion that their savings ratio is too low and that savings in the economy should be increased. What happens if they want to get back to 10 per cent. on the grounds that that is a prudential policy for themselves and their families? What happens if they do that in response to a crisis? The hon. Member for Yeovil (Mr. Laws) has already raised the more than theoretical possibility of a collapse in the housing market and a negative wealth effect whereby people suddenly increase their desired savings level. What happens in those circumstances?
  The answer is simple and absolutely clear. Just as a reduction in the savings ratio provides an enormous increase in consumer demand, so an increase in the savings ratio results in an abstraction of demand from the economy to an equally dramatic degree. How will we cope with that? Will there be a major economic crisis or a recession as a result? Will we have the opposite of the stability to which the Government claim to aspire?
  There are not a dozen possible solutions. What are the possible responses? Not monetary policy, of course. If consumers reduce their spending and increase their savings, it is no use the Bank of England cutting interest rates to compensate, which would be the monetary approach of maintaining demand in the economy. If that happens, the savings ratio will not rise and the British public will be prevented from getting back to the level of savings to which they aspire.
  That is not the answer, so will the Government replace the demand lost when British households decide to increase their savings ratio to a more prudent level? In that case, the golden rules and sustainable debt provisions can be thrown away entirely. My goodness, in order to provide the equivalent of the present savings in the economy—we are talking about moving from 5 to 10 per cent.—the whole amount currently saved by households would be abstracted in demand. We do not know what the exact figure is, because it is not revealed in the Red Book, but we could make a rough calculation and say that if the Government were to respond to that gap by some sort of deficit spending, it would amount to a substantial burden on fiscal policy. If they did that, no credible fiscal rules whatever would be left.
  What is the solution? The fact of the matter is that there is no clear solution. Indeed, as a matter of fact, there is no solution at all. We have mortgaged and hypothecated the future, and critically reduced our freedom of manoeuvre in the future. All fiscal policy, whether under Labour or Conservative Administrations, will bear that burden and that loss of flexibility. The British people will bear it and we will all pay the price—and for decades to come—for the

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  fundamental mismanagement of the British economy over the last seven years. I have to say that that mismanagement is made no more attractive by the attempts to conceal some of the central facts by irresponsible spin doctoring, which seems to have crept its way even into what used to be a greatly respected and independent Treasury document.
  5.24 pm
  Mr. Calum MacDonald: As always, the hon. Member for Grantham and Stamford (Mr. Davies) made an entertaining speech. He made a number of charges against the Government and, from the way he was talking, it was difficult to recall that, when the Conservatives were in government, they were responsible for the two deepest recessions in post-war history, while the Labour Government are responsible for the longest run of economic growth in a 100 years.
  When we hear the hon. Gentleman banging on about public borrowing, fiscal policy being out of control and the costs of interest payments in the future, we need only recall the level of public debt that the Government inherited in 1997, and the crippling burden on Government finances of paying the interest on it, and compare that with the situation nowadays to realise that the debt and borrowing picture is much healthier than when his party was last in government.
  Mr. Davies: If it was such a bad thing for the Conservative Government in the 1990s to accumulate that debt and that interest charge—I agree that it was—why is it such a good thing for the present Government to go back to increasing them?
  Mr. MacDonald: It is obviously not a good thing to accumulate unsustainably high levels of debt and that is why the Government laid down their golden rule, which the hon. Gentleman cited and which the Government are following, contrary to what he was saying.
  When I intervened, the hon. Gentleman chided me for trying to excuse what he claims are current lapses by referring to the activities of the previous Government, but while listening to the debate I could not help reflecting on the very first Finance Bill debate I ever sat through. That was in 1988, when the Government were coasting on the massive economic consumer boom of the mid-1980s, as the hon. Gentleman will recall because he, too, was a Member then. I well remember the then Chancellor, Nigel Lawson, boasting at the Dispatch Box that he was increasing public spending, reducing public borrowing and, of course, slashing taxation— that was the infamous Finance Bill that cut the top rate to 40 per cent. He was able to do all those things at the same time because he could take advantage of the buoyancy of the economy, but all he achieved was a still further stoking of the consumer boom, leaving himself with no resources to deal with the eventual downturn and crash. With that crash came the crash of his reputation as Chancellor. If the hon. Gentleman is looking for examples of fiscal policy out of control, that one is much more real and telling.
  It is worth reflecting on that example, because the lesson that I draw from it is that the true test of a Government and a Chancellor is not how generous they are in the economic good times—how well they spend
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  money when the economy is growing and tax revenues are buoyant—but how well they manage the inevitable periods of slowdown and slow growth. I have no doubt that the Chancellor has passed that test over the last two or three years, better than any Chancellor I can recall and probably better than any Chancellor of the past 100 years.
  The Chancellor passed the test because his approach is the very opposite of that adopted by the last Government, and notably by the ill-starred Nigel Lawson.
  The Chancellor's approach has been to hoard and hang on to public resources when, as the hon. Member for Grantham and Stamford was saying, the private sector is booming—as it was when we came to office in 1997, when the Chancellor earned his reputation as the Iron Chancellor—thus enabling those resources to be released when the economy is slowing down and there could a danger of dipping into recession. The hon. Gentleman referred to the theory underpinning that approach, which, in the old days of the 1960s and 1970s, used to be called Keynesianism. It used to be a very fashionable economic theory, but it has rather fallen out of date now. The irony is that this is the first Government ever to apply successfully a Keynesian approach to the smoothing of economic cycles.
  By contrast, so far as I can judge, all the other Governments since the war—to be even-handed, I include Labour as well as Tory Governments—have ended up doing precisely the reverse. They tended to increase Government spending, as Nigel Lawson did, when tax revenues were buoyant, but were then forced to cut or slash spending when economic times got harder. By doing that, they ended up exaggerating the booms and busts in the economic cycle, rather than smoothing them out and ensuring stability.
  Conservative Front-Bench Members, as well as the hon. Member for Grantham and Stamford, have made a great case about the Government's borrowing in the past couple of years. In previous debates, Members have asked why the Government ended up borrowing more if the economy has been engaged in a record run of growth. The answer, of course, is that we have enjoyed a record run of economic growth precisely because the Government have been able to borrow more at the appropriate stage in the economic cycle.
  The Government have borrowed to increase investment, to increase employment in the public sector and, yes, to increase public sector wages, about which the hon. Member for Yeovil (Mr. Laws) appeared to complain. I do not complain about that because such increases in the rewards for people who work in the public sector were long overdue.
  Mr. Flight: The Keynesian theory does indeed advise borrowing when an economy is below capacity, but it also advises being in surplus or at least in balance when an economy has moved to capacity. What we have criticised is not the possible use of Keynesian measures when an economy is operating below capacity, but the fact that we are now at full capacity and, rather than borrowing trailing off, it stands at £30 billion or

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  £35 billion and possibly £13 billion more than that. That is our essential point. We have not been saying that it is wrong to borrow when an economy is underperforming.
  Mr. MacDonald: The hon. Gentleman and his colleagues take too mechanistic an approach. They should look at the pattern of borrowing and spending over the entire economic cycle rather than trying to match figures to particular years. On that basis, I hope that they will find that the Keynesian model has been met when the cycle is complete.
  David Taylor: I am listening with interest to my hon. Friend's careful analysis. How does he factor in the fact that, in the seven years of Labour Government, we have racked up private finance initiative off-balance-sheet debt of approximately £120 billion—about 10 per cent. of gross domestic product? Does that have an impact on our borrowing position in the short to medium term?
  Mr. MacDonald: Not necessarily, because the PFI debt remains small compared with overall Government spending and Government capital investment. However, the general point that we cannot ignore PFI debt as an obligation on Government finances is correct. In the past, there has been a temptation to move things off balance sheet to make the figures look better; all Governments should resist that temptation.
  The hon. Member for Yeovil pointed out that the Liberal Democrats advocated a much greater spending increase in 1997. I suspect that, had we followed their advice and boosted public spending when we first came into office, we would have fallen into the same trap that every previous Government fell into. We would have exaggerated both the boom in the economic cycle and the consequent slowdown and bust, which would have caused great harm to the economy, disrupted the stability that we managed to achieve and harmed the living standards of our constituents.
  Rather than the disaster decried by the hon. Member for Grantham and Stamford, the Government's fiscal policy has been one of the building blocks of the economic success and stability that they have achieved. The Government are rightly given credit for their early decision to give the Bank of England operational independence. That, too, has been an important building block, as hon. Members on both sides of the House acknowledge, but our fiscal policy has been just as important to our success in managing the economy. The Red Book indicates that we shall continue to follow that policy, which is precisely why the Government are planning for a slowdown in the rate of growth in Government spending, other than in key areas such as health and education.
  To answer the hon. Member for East Carmarthen and Dinefwr (Adam Price), who asked whether the benefit of the successful economic regime pursued by the Government has been spread evenly throughout the country, I dare say that it has not been. However, I am certain that all parts of the country have benefited. I know that my constituency has. When I was first elected to Parliament in 1987, the unemployment rate in Western Isles was more than 20 per cent. As recently as
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  1997, when the national economy was doing well, it was still in double figures. We all remember how in the 1980s and early 1990s it was regarded as a given that mass unemployment was a feature of our modern economy. In the late 1980s, I would go to local meetings and discuss such things. Everyone accepted that mass unemployment was here to stay, and the debate was about how to reshape and adjust society to cope with the reality of permanent unemployment. Teachers would say how depressing it was to educate children who would leave school and go straight on to the dole queue. People would come to our surgeries having been made redundant. If they were in their mid-40s to early 50s, they knew and we knew that they were never going to work again. All that has changed profoundly.
  Mr. Bacon: Is it not true that many people who were in the Western Isles in that period are no longer there? By how much has the population of the Western Isles declined since then?
  Mr. MacDonald: It has declined at the same rate in every decade except one since the 1920s. It did not decline in the 1970s, when a Labour Government were in power. That, however, was not a big factor in the change—it was the fact that local government reorganisation led to the setting up of a single-tier local authority and a consequent increase in employment in the islands. The hon. Gentleman is right that there has been a constant decline in the population in the Western Isles and other remote and rural parts of Scotland. In the past, the search for jobs drove people out, but nowadays things are a lot more complicated. In 1987, unemployment was over 20 per cent. in my constituency, but it is now 4.3 per cent., and has never been lower. We are now doing something that was inconceivable 20 years ago—importing immigrant labour. I go to factories in my constituency where Russians, Romanians and Bulgarians are working. I talk to the skippers of fishing boats, who tell me—the west coast industry is in a very different position from that of the Scottish east coast, and is much more prosperous and stable—that they are paying the best wages ever but are still short of people to man their boats, so they have to tap into the east European labour market. The population decline is continuing to some extent, but it is underpinned by different factors are equally serious and in need of remedy.
  Angus Robertson: The hon. Gentleman will know that, throughout the highlands and islands, the whisky industry is an important employer, although I appreciate that there are no distilleries in the Western Isles. Does he believe that the introduction of strip stamps will harm the industry, or does he think it is a good thing?
  Mr. MacDonald: The hon. Gentleman is right that that industry is not to be found in my constituency, so I do not have any specialist expertise. I shall therefore listen with interest to subsequent debates when he discusses the matter with the relevant Minister.
  I turn to another couple of items of particular relevance to my constituency. Clauses 5 and 14 deal with fuel duty, which is of particular concern to my constituents. About four years ago, I had an

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  Adjournment debate about the regressive impact of fuel duty on remote and rural locations such as the Western Isles. Since that time, the Government have dropped the automatic escalator and the duty has basically gone up in line with inflation. As a result, we can see from the Red Book that the revenue raised from fuel duty has hardly risen from the time of my Adjournment debate about four years ago and is still around £23 billion.
  I am glad, of course, that the Government dropped the escalator, and I accept that there are strong environmental arguments and reasons for the level of fuel duty, but I still maintain that it is a regressive form of taxation. Only three other taxes raise sums similar to or greater than fuel duty—income tax, VAT and corporation tax. Yet whereas each of those three big taxes has exemptions, bandings or some other device built in to make it more progressive, fuel duty is still a flat-rate, one-size-fits-all tax across the whole United Kingdom. There are exemptions to and variations in it, but they are designed to make it more efficiently green and environmental, not more progressive.
  Fuel duty is regressive because remote rural areas tend to have lower incomes than the national average, but much higher car ownership and a much greater need to use cars than the rest of the country. For example, car ownership is 70 per cent. in the highlands and islands, compared with about 50 per cent. in urban areas, but incomes in the highlands and islands are only 70 per cent. of the national average. Those figures make it clear that car transport in remote areas is essential, not an optional extra, and essential, moreover, for people on low incomes. That should be recognised in the way that fuel duty is levied in the United Kingdom to allow for the difference between remote rural areas and the rest of the country.
  The arguments with regard to air passenger duty are similar. My constituency and Orkney and Shetland are the only ones in Britain where the health service routinely uses air transport to carry patients and staff. Air transport therefore represents a lifeline service. It is not a luxury travel option. The Government are to be congratulated on having recognised that to a significant extent by exempting flights originating within the highlands and islands from the air passenger duty, but flights coming into the islands from the mainland still have to pay tax.
  Although air passenger duty is not mentioned in this year's Finance Bill, I am well aware that the green lobby is constantly agitating and arguing for higher taxes on air transport, so I take the opportunity to make the point to Ministers that, if they are minded to take on those representations from the green lobby, they must first tackle the issue of air transport in the highlands and islands.
  The final matter that I want to raise has already been mentioned—the excellent Lyons report on dispersing civil service jobs, which was published with the Budget last month. I recall writing a few years ago to the then Minister for the Civil Service suggesting that the performance and innovation unit should be asked to look into the case for relocation. To my disappointment, little interest was shown in that suggestion, but I am delighted that the Chancellor is now pursuing jobs dispersal with such vigour. My constituency has managed to attract more than 100 new civil service jobs in the past year, principally from the Department of
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  Trade and Industry and the Department for Work and Pensions. Recruitment for those jobs is happening now, and the reports from those Departments suggest that individuals with higher educational attainments than those who would have been recruited in London or the south-east are applying.
  The Lyons report says that the public sector could gain £2 billion over 15 years from the job dispersal policy, but it is important to recognise that the biggest benefits are more immediate than that time scale suggests. The public sector will gain immediately by recruiting higher-quality staff and by increasing staff retention, and the communities that receive those jobs will experience a much needed, direct boost to their local economies.
  The civil service will, of course, resist the Lyons proposals. Some hon. Members know that that point was highlighted in Scotland, where it took a great deal of effort by the Scottish Executive to get a reluctant Scottish National Heritage to move from Edinburgh to Inverness. However, the wider public interest is undoubtedly paramount, and it is best served by a determined, extensive and sustained policy of civil service job relocation. I urge the Government to make that policy one of their most important priorities.
  5.51 pm
  Mr. Michael Jack: I begin by reminding the House of my declaration in the Register of Members' Interests, and in particular of my position as a non-executive director of a retail tile company.
  Some time before 2 o'clock on Sunday afternoon, I ran past the Paymaster General's office. Despite the pain and suffering and the need for mind to triumph over matter, I sent up a silent incantation that the 26 miles did not include too many for the Chancellor of the Exchequer and Customs and Excise. I am grateful to the Paymaster General for her clarification of what the Chief Secretary said in response to those who raised the issue of VAT and the London marathon.
  I have read some of the comments in the newspapers, and although the Treasury statement makes it clear that charitable donations are not liable to VAT, the relationship between VAT and the golden bond is still cloudy, particularly on the narrow point of charities asking those who secure places in the marathon by the golden bond route to raise a fixed sum of money. Those charities are trying to cover an overhead for securing a place in the race, and it is important that they are not burdened by an unanticipated bill.
  I ran for the National Osteoporosis Society, which hopes to raise about £60,000. All hon. Members hope that all the money raised not only for the National Osteoporosis Society but the other excellent charities for which people gave an enormous amount of time and energy on Sunday goes to the intended good causes. It would be helpful if a clear and definitive guide were published, because the same problem is likely to arise on the great north run, where secured places are also a feature of fund raising. The matter must be clarified because it is confusing.
  I pay tribute to the Paymaster General. Over the past year, she has listened to representations on a number of tax issues, for which I am personally grateful. I am also pleased that Treasury Front Benchers continue to

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  support the tax law rewrite exercise with vigour and enthusiasm, and I concur with the Paymaster General that it is nice to see that some parts of the Finance Bill are more legible than previously—at least somebody is listening. I am however disappointed that this year's Bill, like last year's, does not suggest that the Government want to go further than rewriting tax law in plainer language and a better form, and study how they can genuinely simplify and improve our tax system's operation. I will have more to say about that when I consider clause 290.
  I very much welcome hon. Members' remarks about transparency in the operation of the economy. The time has come when Ministers should publish annually in the Red Book—I must say to my hon. Friend the Member for Grantham and Stamford (Mr. Davies) that I still call it that, notwithstanding the fact that the colour of its cover has changed—a cash flow for the British economy. If the Treasury is willing to put on record the model by which it works out the economic modelling of the United Kingdom, it should be able to put on record the assumptions by which tax revenues are worked out, to enable us to see with greater clarity how the cash flow of the economy is working. As even Ministers recognise, by the time we reach the end of the figures in the Red Book, the proportion of gross domestic product that is raised by tax will have increased.
  My right hon. and hon. Friends on the Front Bench have tabled a reasoned amendment with which I have much sympathy, because it points to the lack of improvement in UK productivity and relates that to the problems that it causes to competitiveness. As I think Liberal Front Benchers would agree, the Chancellor has over the years introduced many micro-management measures, but we have had no feedback on what they have achieved individually. Given the degree to which the economy is managed through the tax system, we should demand a proper impact analysis of any measure that is introduced. It is no use introducing measures with great claims that they will improve the running of the economy if the overall facts on productivity, and therefore competitiveness, do not line up in that direction.
  For those of us who have stamina for legislation, 309 clauses, 42 schedules and 574 pages beckon, and I look forward to our forthcoming debates. One part of the Bill deals with hydrocarbon duties and reduces the preferential rates of duty that red diesel has enjoyed. For those of us with an interest in agricultural and rural matters—I think that the hon. Member for Western Isles (Mr. MacDonald) will sympathise with me—that is not welcome, given that agriculture is only now pulling out of one of the worst phases of its cyclical downturn. Incomes are rising, but not to a very high level. It is not a particularly clever time to make such a move, as farmers must face it against a background of ferocious price competition from their principal customers, the supermarkets. The Government have again been somewhat mean-minded in the help that they give to biodiesel.
  I am sorry that the Economic Secretary is not in his place to reflect on the fact that over the past 12 months no move has been made towards trying to start an indigenous biodiesel industry, based on UK-grown
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  oilseed rape, with processing in this country. Investment has been made in the plant in Motherwell, which will produce an additional 4.5 million litres of that fuel, but it will use cooking oils and fats as its initial feedstock. If the Government are genuinely interested in the agenda of sustainability, improved environment and reduced carbon dioxide emissions, they must make their mind up on the matter. If they give a 40p duty derogation for liquefied petroleum gas because they rate heartily the air improvements that result from that road fuel, they should at least increase beyond the amount in the Bill the duty derogation for biodiesel. Let us forget for a moment the Treasury's worries that that would in some way sponsor a massive rush of imports. If we do not follow the biodiesel route of our own volition, the product will be imported.
  There is a cost-free way of including biodiesel in our fuel source and giving the local industry a chance to generate. In the context of the Energy Bill, we should support efforts to require a target for blending biodiesel and normal hydrocarbon fuels so that the resulting price was whatever it happened to be. More Treasury money would not therefore be required to enable us to have a proper biodiesel industry. If nothing else, the Treasury could, with a 2 per cent. target, adopt the same techniques as for the renewables obligation in electricity and blend the tax position. Although that would result in a small increase in price, especially of diesel fuel, it would get our home-grown biodiesel off the ground.
  Clause 118, which is entitled "'Film-related losses' and 'non-taxable consideration", leads me to the subject of tax avoidance, which I wish to examine in some detail. The Government had a love-in with the film industry, rushed to the barricades to help it in every way, but were caught out Clause 118 is a classic illustration of that. A measure was devised to try to help the film industry but was exploited, and a loophole was created that now has to be filled.
  Dawn Primarolo: I look forward to the right hon. Gentleman's comments on avoidance and the way in which to deal with it. It is incorrect that clause 118 specifically tackles the exploitation of the reliefs that we introduced. It deals with the use of the tax system in ways that were never intended. Such provisions had existed in the tax system previously and were unconnected with the film industry. The clause is therefore not connected with the reliefs that we have given.
  Mr. Jack: I am glad that the Paymaster General used the words "in ways that were never intended." That almost goes to the heart of the challenge of dealing with tax avoidance. The Revenue is the expert on tax in this country—or is it? It is clear that the purveyors of avoidance products or ideas have great resources and much expertise. As clause 118 shows, they noticed something in the relevant part of the tax code that the drafters did not. Avoidance happens partly because people can interpret the words that are written. We do not express our tax law as an academic or scientific formula, but as a set of words. It is expressed in the English language and is therefore interpretable.
  We must consider whether sufficient good advice is available to examine drafting tax law more carefully. That is why I made a point about complexity. In July

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  1999, Mr. Edward Troup, who works for the City law firm of Simmons and Simmons as head of tax strategy, wrote a piece in the Financial Times about general tax avoidance. He argued that
  "the aim of government should"
  be to
  "do its best to ensure that the 'return' from tax planning is as low as possible … a simpler tax system, with fewer reliefs and exemptions and discontinuities would, in the long term, frustrate most of the tax avoiders' ploys."
  The article goes on:
  "But behind the easy macho rhetoric of being tough on tax avoidance, successive chancellors have consistently failed to understand the inevitable nature of avoidance as a reaction to complexity and have ended up addressing its symptoms and not its causes."
  One of the problems in assessing clause 290 of the Bill is that we have to do so almost in a vacuum. The House has not been presented with any kind of analysis of the weaknesses in our present tax code. For example, we do not know where the weaknesses are in the avoidance schemes that have either been marketed or have been detected by the Inland Revenue's mechanisms. We do not know how much money has been put at risk. There are an awful lot of "don't knows", yet we are being asked to adopt a new law under which, instead of the Inland Revenue relying on its expertise and surveillance, it will effectively have to ask people to put their hands up before the act is committed, and to declare what they are going to do in marketing or in finding ways to avoid tax. I return to what the Paymaster General has just said. The reason that we have avoidance is that, in a complex tax system, people see loopholes—in other words, things that were never intended.
  Mr. Troup's article goes on to make a perceant comment:
  "Tax avoidance is paying less tax than Parliament would have wanted."
  That brings us to the question of whether we know what legislation we are passing. Do we know what we really want when we pass tax legislation? I hope that the Bill will receive adequate scrutiny this year, so that Mr. Troup's point can be addressed. He goes on to say:
  "Avoidance is where Parliament got it wrong, or didn't foresee all possible combinations of circumstance."
  If these avoidance laws are to be implemented, will the Minister tell us what is being done to strengthen the work of the Inland Revenue through both the drafting of tax law and the development of its perceptiveness into how tax law operates? What has the Inland Revenue learned from all the tax avoidance schemes that are currently marketed? Is there a theme running through them which shows a weakness in the way in which our tax law is drafted—or must we accept that, because we draft it in such language and form, it will, by definition, always be testable, and that there will therefore always be potential weaknesses?
  Those of us who have served in the Treasury understand the need to protect the Inland Revenue from the sharp minds in the financial community. One could argue that if we had much lower marginal rates and a much clearer tax system, there would not be the inducement to want to avoid paying tax. However, we have not had a debate on the motivations behind the natural desire of any taxpayer to save or to avoid—as
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  opposed to evading, which is clearly illegal—the payment of tax. Mr. Troup gives us some further perspectives:
  "The problem of tax avoidance is reduced to the problem of finding an answer to the question of what parliament intended and making sure that this is complied with. I would not pretend this is a simple task. But recognising this as the issue and dealing with it equitably and constitutionally would be a significant step on the way to tackling avoidance effectively."
  Obviously, we do not yet know whether the provisions in the Bill will have that effect.
  The first cockshy at understanding clause 290 appeared in the 15 April edition of Taxation, whose Finance Bill Update column states:
  "As drafted at present, any thought which reduces tax (although not National Insurance contributions) which passes through anyone's head who is involved in any way with tax services becomes a 'notifiable proposal' once that thought is expressed to another person, whatever the circumstances in which it is expressed. Anyone who has any input, however small, into the idea also makes himself a promoter liable to disclose the idea, if nobody else does. However, much of the detail is left to the scope of regulations yet to be made."
  That is one of the most interesting features of clause 290. Subsection (1) states
  "In this Part 'notifiable arrangements' means any arrangements which … fall within any description prescribed by the Treasury by regulation".
  When I looked at the Government's website to try to obtain more information on what the clause was all about, I was directed to Treasury press notice 29/04, which was issued on 18 March. It told me that all kinds of new information would be made available to me. I discovered that the Treasury's permanent secretary had had a meeting on that day to discuss all this with business leaders. By the time I had read what was already in the public domain, I had established that full details of all this lot would be made available on the publication of the Bill. "Full details" and a regulation yet to be published do not strike me as a full and final disclosure.
  Under "Meaning of 'promoter'" in the Bill, we read that
  "he is to an extent responsible for the design of the proposed arrangements".
  Could one not almost say that the draftsman—the designer of the original legislation, which then became subject to avoidance—produced part of the design of the tax avoidance scheme? I hope that the Paymaster General will able to explain exactly how the proposals will work.
  An interesting case has arisen in the context of the sale by Aberdeen Asset Management of a loss-making activity called the Aberdeen Preferred Income Trust. In the newspapers it was reported that when those who had invested in the organisation sought to get their money back, they were disappointed by the financial returns they received. An article in The Times on 3 April stated:
  "But it has emerged that it is not only the 7,200 Abpref shareholders—who lost 99 per cent. of their money—who should feel cheated. Their misery will help a private company to lower its tax bill, costing the Treasury tens of millions of pounds.

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  Loopholes in the law mean that the property company that bought the Abpref shares for £3.7 million can use the trust's huge tax losses to … avoid paying £45 million in tax."
  The use of tax losses in business to offset taxable profits is nothing new, but in the context of that transaction, would it be caught by clause 290? Clearly someone has looked carefully at a tax-loss situation, taken professional advice and designed a scheme enabling him to buy up the losses of the Aberdeen Preferred Income Trust. The poor investor—a Mr. Davies—who put £7,000 into this duff investment activity got £1.96 in return for his endeavours. As a result of the sale of the tax losses, there is a potential avoidance of £45 million. That is a currently accepted use of tax losses, but is it a product or a case of someone seeing an opportunity? It will be interesting, in considering clause 290, to try to differentiate between the opportunistic exploitation of existing legitimate functions of the tax system and the deliberate creation of functions by reinterpretation of the current tax law. We all want a proper amount of tax sold, but I think that there will be some testing times.
  To give a flavour of the views of the accountancy profession, when probed on the matter, a spokesman for Ernst and Young commented that there are more sellers of tax losses than buyers, so the shares are not easy to sell. He would not be drawn on the ethics of selling tax loss, but insisted that it was in the best interests of all parties. He said:
  "The only reason that investors are getting anything back at all is because we made a deal to sell the company."
  There will be some very interesting and testing grey areas in what is arguably one of the sexier parts of this Finance Bill.
  On the question of savings, I want simply to reinforce the comments that have been made. At a time when individuals' endowment policies are under great pressure, and their pension funds are not yielding the expected amounts, the time was not right for the Government to cut back on individual savings account allowances. They should have looked at more coherent methods of promoting savings, to enable people at least to try to make up for some of the losses that they are suffering on their endowments.
  I conclude with some observations on those two parts of the Finance Bill that deal with the Government's assault on small businesses. We heard the points made by my hon. Friend the Member for Arundel and South Downs (Mr. Flight) on the question of incorporation, and on the operation of section 660A. I shall not go into detail on those matters, but there is a stark contrast in relation to the example that I have just given. While the Government are seeking to deal with general tax avoidance, they ought on the other hand to encourage the retention of moneys in small business. However, with IR35, section 660A, and now other elements of the Finance Bill, they seem to be hammering hard on these small engine room businesses for the British economy. Why does that group seem to have been singled out for particular treatment, when a more considered review might have been the best way forward? Such people are the entrepreneurs of the future and the engine rooms of the service economy, yet they seem to be getting a bad deal in the Finance Bill.
  6.17 pm
  Mr. Nigel Beard: The first thing to emphasise about this Budget, and the Finance Bill that gives effect to it, is that it satisfies the discipline that the Chancellor has imposed on public finances for the past seven years through the fiscal rules: the golden rule and the sustainability rule.
  Adherence to fiscal self-discipline has brought about an unparalleled period of stability in the economy. At the same time, a fair distribution of financial liabilities has been achieved between the generations. Disciplined fiscal policy has been complemented by the Bank of England's independent conduct of monetary policy, which has given the financial system confidence that interest rates are fixed for economic reasons and not for political expediency. The consequence has been an unprecedented period of national prosperity, resulting in record low levels of inflation, interest and mortgage rates and unemployment, a stable economic climate that encourages businesses to invest and plan ahead and a resilience internationally that enabled the British economy to keep growing when the rest of the world moved into recession. On top of that, we are maintaining record investment in health, education and training to remedy 18 years of wanton neglect and to secure the foundations of the future.
  None of that has been achieved at the expense of a fundamental commitment to social justice, which has been maintained through the working and child tax credits, the minimum wage and state pension increases that far surpass what would have been gained by linking pension increases to incomes.
  Those are historic achievements that this Budget and Finance Bill continue. Yes, there are questions for debate, which are raised in the Treasury Committee's report, about regulation, whether consumer debt is too high, the significance of rising house prices, the impact of the falling dollar and future tax revenues. I recognise all that, but those issues are the pimples and scratches on the great edifice of the country's economic achievement. They are real issues, but they must be kept in proportion. Above all, we must not accept what the Opposition would no doubt like the country to believe— that the present prosperity and fair prospects for the future depend not on the policy of the Government but on astrology or the position of the planets in certain constellations. This country's prosperity does depend on Government policy, it will depend on it and it could be wrecked by the ideological folly of the Conservative party. After determined opposition, and some kicking and screaming, they have now accepted the Bank of England's independent role in framing monetary policy.
  The dog that did not bark in the night is the Conservatives' unwillingness to accept the Chancellor's fiscal rules. They are within two years of a general election, but they will not say that they accept these rules or, indeed, any other rules. All they will say is that, whatever the economic circumstances, they will reduce taxes. We know what impact that would have on public spending, and Labour Members will ensure that the public at large understand the local and national impact on the national health service, schools, universities, public transport and roads.
  The other question is what the impact will be on the overall management of the economy when the Conservatives do not accept the discipline of any

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  guiding rules. What will be the impact on jobs, on industry, on interest and mortgage rates and on training? What is there in the golden rule and the sustainability rule that a modern political party cannot accept? The golden rule secures fairness between generations. It says that the Government—on balance, over the five or six years of the economic cycle—should borrow only for capital spending: spending that will benefit the next generation and perhaps beyond. In other words, people who enjoy benefits now and in the future will pay for them. The opposite approach is to borrow for immediate current spending, which benefits only those who are around today but leaves much of the payback to future generations who do not benefit at all.
  The sustainability rule ensures that even if borrowing is for capital investment, the burden of debt now and in future does not build up disproportionately. In other words, it prevents people today from investing in capital projects to such an extent that the next generation is so burdened by inherited debt that they are prevented from investing for their future.
  It is important to stress that the golden rule, whereby borrowing equates to capital spending, does not apply to any one year, but to the whole economic cycle. Thus, when economic activity is at a low ebb and, consequently, Government tax income is low, borrowing may provide for some current expenditure, which then stimulates economic activity, but when the high tide of economic activity comes along again and tax revenue to the Government is high, that revenue must be used to repay the excess borrowing when the economic tide was low.
  Although the Conservative party is reluctant to sign up to the Chancellor's fiscal rules, its economic performance in the past came nowhere near this Government's achievements. It cut public spending when tax revenues declined as the tide of general activity receded; thus, it deepened the recession. As an alternative, when the high tide of economic activity came along and tax revenues increased, the Conservatives cut taxes for the better off and so overheated the economy as to create runaway inflation. They penalised low-income families on the downturn of the economy through unemployment and rewarded the top 10 per cent. or so with tax reductions when the economy improved.
  Mr. Jack: Does the hon. Gentleman not recall that when the higher rate of tax was reduced to 40 per cent., the cash take to the tax system increased?
  Mr. Beard: It might well have done, but it did not satisfy the Conservatives' macro-economic conditions. Such action led to the crisis that Mr. Lawson created, which resulted in interest rates of 15 per cent.
  Boom and bust was not just an historical economic accident that came along while the Tory party happened to be in power: it was the result of the Conservatives' own feckless, ideologically drive policies, which they appear inclined to repeat in 2050, or whatever future date thereafter when they next take power.
  To lift a major part of the country's economic policy out of political controversy, I appeal to the Conservative Front Bench spokesman to say at the end of the debate that the Conservatives accept the
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  Chancellor's fiscal rules as a basis for future economic policy. If that commitment cannot be given, can the House please be told why not?
  I turn to some of the more specific issues that were brought out during the Treasury Committee's consideration of the Budget. The current economic cycle is considered to have started in the financial year 1999–2000 and to end in the financial year 2005–06. On the basis of cautious assumptions, the average annual surplus over that period will be 0.1 per cent. of gross domestic product, so the golden rule will be properly satisfied. However, tax receipts for the past three years have been overestimated and the outturn has been lower than forecast. In the next two years, tax receipts from income and corporation tax are forecast to bounce back.
  Some of the Treasury Committee's external advisers have questioned whether the extent of the forecast increase in tax revenue will be achieved. That question was put to Treasury officials when they gave evidence on the Budget to the Committee. Their answer was that the forecasts are grounded in confidential information from the Inland Revenue and Customs and Excise about how taxes are paid, which feeds into the methods of forecasting tax revenues. Given that that information is so central in assessing whether the golden rule is likely to be satisfied, I emphasise the Committee's recommendation that the Treasury should consider ways of sharing with outside forecasters as much aggregate data on the way in which taxes are paid as possible. That would lead to a more fully informed debate on the extent to which the fiscal rules are likely to be satisfied.
  The Treasury forecasts that the economy will grow at 3 to 3.5 per cent. during the next two years but will then return to a trend growth rate of 2.5 to 3 per cent. The fiscal projections are in line with that economic projection. However, if growth should continue above trend, it is important that the increased fiscal surpluses are retained and not spent, so that fiscal and monetary policy work in the same direction at that point in the economic cycle and so that fiscal flexibility for the next cycle is ensured.
  Now that we can contemplate continuing conditions that are favourable to economic growth and prosperity, to full employment and to major improvements in our public services, the productivity of the United Kingdom economy increases in significance as a factor that could restrain the wealth of this country during the 21st century. In terms of output per hour, the UK is far behind France, Germany and the United States. Between a third and a half of that deficiency is due to a lack of investment in plant, machinery and other physical assets. As a more predictable economic climate takes hold and takes away uncertainties, attitudes to new investment might change. Indeed, the Chancellor's various means of encouraging business investment are to be welcomed.
  What is astonishing, however, is that two thirds of the productivity gap between Britain and the United States exists because Britain lags behind in innovation. This country is one of the most ingenious and inventive in the world, but we do not follow through to gain the economic benefits. Too often, something is invented in Britain but commercialised in America or Japan. In that context, I am pleased to see improved tax incentives for

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  research and development on top of the Government's increased budget for scientific research, and their commitment to excellence in our universities.
  Governments can only enable, however, and there is also a need for a culture change in boardrooms and business schools to give far greater emphasis to business renewal. That is vital not only to catch up with the United States but if we are to hold our own in competition with the rising economic power of China, India and south-east Asia.
  There is another dimension to productivity, which is not a concept that should apply only to market-driven sectors of the economy but to the public sector, too. There must be developed an agreed measure, equivalent to productivity, for health, education, public transport and local authorities. Sir Peter Gershon's recent report addresses the issue, but it is only a snapshot. With increasing resources committed to public services, there must be systematic accountability for what is being achieved.
  Productivity in one form or another will be a major economic issue in the first half of the 21st century and beyond. The Treasury Committee is embarking on an inquiry into United Kingdom productivity and its regional variations. The resulting report may provide the occasion for a much fuller debate on these issues in the Chamber.
  The peacetime history of the past 100 years has been about developed countries learning how to manage their economies in order to mobilise the energy and abilities of the people to increase their own wealth and opportunities. It is a continuing process to which this country has made a major contribution. That contribution has never been greater than what this Government have achieved over the past seven years. It is not at an end. Indeed, the prosperity and temperament of Britain in the 21st century depend on progress continuing. This Budget and this Finance Bill are a further step towards achieving that.
  6.31 pm
  Adam Price: Stability has been the leitmotif of this debate. I am tempted into the heretical thought that, although it may be part of the new Labour creed, the attractions of stability depend on how one experiences it. It looks different from the top of the heap than from the bottom. It is possible to stabilise at a lower level of growth. Death confers a certain stability; it is certainly a permanent state of equilibrium—a term from micro-economics.
  The hon. Member for Western Isles (Mr. MacDonald) is no longer here, but we can see a consistency in the experience of certain parts of the United Kingdom, including his part of Scotland and others, and my part of Wales. We have seen outmigration—in the case of his region, since the 1920s. We may not have stop-go any longer, but they have not stopped going from the Western Isles. We have the same problem of the haemorrhaging of the young from our communities, and there is no sustainable economic future for the long term for any community that continues to lose the best and most talented of its youth.
  Amid the paeans to stability that we have heard, I offer a word of caution. The picture is diverse across the United Kingdom, as hon. Members who represent
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  constituencies to the west and the north of these islands will know. The Bill could have contained different bands of business taxation not only for different sizes of companies but for different regions, as is done in Spain, depending on their economic performance. If we have a lower band of taxation for smaller companies because we believe that that will incentivise growth, surely the same tool could be used with even greater effectiveness in less advantaged parts of the United Kingdom.
  I see the steely gaze of a hired assassin in the Chamber, so I shall give way to him.
  Mr. Wayne David: I thank the hon. Gentleman for that compliment. I am provoked to rise because of his comments about different regional tax rates. Does he not agree that in some parts of our own country of Wales. particularly around Cardiff and Swansea, the economy is doing extremely well? Surely he is not suggesting that there should be different tax rates for areas that are doing extremely well.
  Adam Price: If we are talking about regional taxation, it is obviously true that there is a different pattern of economic activity within every region. To some extent, the relative success of parts of the south-east Wales corner is a reflection of the pattern of economic activity throughout the whole of the UK. Indeed, south-east Wales is mirroring the greater prosperity of the south-east of England. As I understand it, it is not possible under European competition law to have different tax regimes at a very localised level, other than for local taxation. Of course, it is possible to have regional corporation tax, as is the case in the Basque country and in Navarre. I simply offer this as a possible tool for the Government's regional economic policy armoury. We have all signed up to the Treasury's policy aim of narrowing the gap in regional economic growth between northern countries and southern ones. Perhaps different bands of taxation would be a more effective tool in incentivising business growth.
  I want to concentrate on two sources of instability. We have been told that the Government are confidently navigating us through calm waters, but as we have heard, there are certain whirlpools of instability.
  Angus Robertson: Does the hon. Gentleman share my concern about the future of jobs in the whisky industry as a result of the Government's introduction of strip stamps, which will impact not just on the Scotch whisky industry but on the Irish whiskey industry and the renaissance of the Welsh whisky industry at Penderyn? The general manager of one of Speyside's premium distilleries wrote to me a few weeks ago. The letter said:
  "We are considering turning our back on the UK market entirely and by 2006 securing other markets for our products, rather than suffer the new tax regime."
  Reference was also made to the number of jobs that will be lost. Does the hon. Gentleman think that the introduction of tax stamps on spirits is a good idea, given that a workable alternative exists to enable the crackdown on fraud that every Member of this House wants to see?
  Adam Price: I agree entirely with the hon. Gentleman, and when the Committee of the whole House sits next week, I hope that the opportunity will arise to strike

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  down these proposals, which are very damaging to the Scotch whisky industry. The last Welsh distillery closed 120 years ago, and we have waited all that time to get our whisky industry back. Yet within 16 days of the launch of the first single malt Welsh whisky in 120 years, the Chancellor's iniquitous strip stamp proposal is introduced.[Interruption.] We should have kept it under wraps for a little longer. I am not sure whether there is an English whisky, but if so they can join our battalions in defeating these proposals.
  I want to concentrate on two problems of what used to be called political economy—economic problems with a major policy component—that the Government face, the first of which concerns pensions. Some 120 clauses, more than a third of the Bill, are devoted to pensions. Unfortunately, the poor old members of the Pensions Bill Standing Committee are upstairs and have been unable to contribute to this debate. The other issue, which was mentioned by the hon. Member for Yeovil (Mr. Laws) in particular, is the looming fears about the state of the property market. We should consider the two problems together, because they are linked in the Bill. In pensions, we have the crash in the equity market that has already happened; in property, we have the crash that may yet happen. For one set of assets, value has collapsed; for the other set, value has risen exponentially.
  It is interesting to make the contrast. Property is one of the few asset classes that has been successful. The right hon. Member for Fylde (Mr. Jack) spoke about problems in the financial services industry. We know about problems in Equitable Life, problems with the occupational pension funds of ASW and other companies and problems with split capital investment trusts and so forth. Wherever one looks in the financial services industry, there are problems, which contrasts markedly with the exponential rise in property values.
  In the light of that contrast and the contra-cyclical effect of the two markets, it is not surprising that the Government are trying to achieve a more reasonable spread of investments. They are trying to create a more efficient and effective mechanism for making investment in property part of the pension funds through changing the regulations for self-invested personal pensions schemes or SIPPS and small self-administered schemes. The problem is with the timing and the means by which the Government propose to introduce those changes. There is a real fear that by trying to deal with the pensions crisis and particularly the collapse in the equity market, thereby creating a mechanism for property investment for pensions, the Government could be exacerbating the problem of speculative investment in the housing market, or even precipitating and bringing about the very crash in the property market that they tell us we have no need to worry about.
  Mr. Simon Thomas: This afternoon I attended the launch of a Shelter campaign that highlights the fact that a million children are living in poor housing and highlights the general lack of affordable housing within the UK. The Government are attempting to deal with the problem through some of the Budget proposals, and I am happy to acknowledge that. However, one of the facts revealed at the launch of the campaign was that since 1960, the price of bread has gone up six times and the price of housing 60 times.
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  Within that context, does my hon. Friend believe that the Budget does enough for affordable housing in our communities?
  Adam Price: My hon. Friend makes his point extremely well. To be fair, I agree that the Budget statement made some recognition of the problem, just as we have seen belated recognition of the regional economic divide. The Government have recognised the problem of affordability, but the difficulty is that the cupboard is bare of policies. Indeed, the policies in the Finance Bill will make matters worse for housing.
  It is clear from reading the explanatory notes to clauses 171 to 174 and from drawing on the good offices of the Library—[Interruption.] However much the Chief Secretary shakes his head—it is, to quote a famous parliamentarian, his head to shake—it is clear that those clauses introduce changes to SIPPS. There used to be a bar on using SIPPS to invest in residential property—they applied only to commercial property—but that bar is being lifted. They can now be used for all sorts of esoteric investments, but we will not go down that road. The bar is certainly being lifted and in a way that appears very attractive to many people. Currently, about 200,000 people are in SIPPS or small self-administered schemes. Following a certain day in 2006, it is predicted that there will be an exponential rise in their number—[Interruption.] That is the view of independent pension advisers. The head of pensions at Scottish Life, for example, expects there to be very strong interest in them. He certainly knows more about pensions than me, and probably more than many Members. That view is reflected widely in the pension industry; there will be strong interest in the effect of the proposals. If the Government thought that there would be no interest, why did they introduce the changes? Can they answer that?
  In the regulatory impact assessment, the Government consider the extent to which the changes in SIPPS that allow those pension funds to invest in residential property will lead to an increase. They claim that because the number of people in SIPPS is small at present—only 1.3 per cent. of people are covered by such pension schemes—the effect will be only at the margins, but they are changing the regulations. To date, the property use of SIPPS has been limited because they were not widely available, but the Government are, in effect, deregulating through creating the single pension scheme, so there will be no holds barred within the borrowing limit of 50 per cent. of the pension fund. There will be substantial interest in such schemes.
  The problem is that the changes will add oil to the flames of an already overheated housing market. A survey published today by the Royal Institution of Chartered Surveyors showed that March saw the highest increase in housing prices for any month since March 2002, so the housing market has not petered out and reached a soft landing.
  Hywel Williams: Does my hon. Friend agree that there are regional variations? Last year, my constituents in Caernarfon in Gwynedd experienced the highest increase in house prices, which rose by 57 per cent. in one year. What effect will the Government's changes have on that market?
  Adam Price: There has certainly been a problem of affordability in relatively low-wage local economies such as north-west Wales for many, many years, which has now been greatly exacerbated by the massive increase in house prices that has occurred in many other rural areas and now afflicts many urban areas, too. In that context, it seems a crazy move to add further billions of speculative investment to the housing market.
  Colin Brown of Grant Thornton said that the rule change will inevitably lead to a further rise in house prices as individuals flood into the market and change the make-up of their pension funds. Tom McPhail, of independent financial advisers Hargreaves Lansdown, said:
  "It is hard to reconcile the Chancellor's stated ambition of controlling the housing market's disproportionate influence on the economy with a proposal which will allow several hundred billion pounds of pension fund money to wash into the housing market."
  That is what independent observers are saying about clauses 171 to 174.
  The changes come on top of an already overheated housing market. Why is the market overheated? Because, as we heard from the hon. Member for Yeovil, there is a large buy-to-let component. Yesterday, the Financial Times published figures showing that total buy-to-let lending rose from £24 billion in 2002 to £39 billion in 2003. Although there are signs that the rental market has started to overheat, it is not yet damping down. Returns on buy-to-let investment stagnated in the fourth quarter of 2003 due to the over-supply of rental property; too many people have gone into the market. For instance, yields in London are often below 5 per cent., compared with 7 per cent. in the rest of the country. That trend is likely to spread, as more investment goes into that sector.
  Rental yields have been dropping, yet more money is flowing into that market. That is a classic, textbook case of speculative investment. People are basing their investment decisions on expectations of capital gains, regardless of the income base. That is precisely what has happened in Australia, where the buy-to-let sector now represents 45 per cent. of the entire property market and yields have fallen to 2 per cent. Yet the property market is still surging ahead because of the capital gains expectations. That is a classic bubble. Is that the context in which the Government want to create a mechanism that involves a few extra billion pounds? I ask the Paymaster General to give a figure for that when she responds to the debate. To be fair, the Government go into some detail in the regulatory impact assessment to discount some of the arguments that I have adduced, but no figures are given for the extent of the increased investment flowing into the housing market as a result of the changes to SIPPS.
  Obviously, a housing property crash would be catastrophic. That goes without saying and we have heard the reasons for that already. Given the already high level of household indebtedness, factoring in a property crash could put us in an extremely worrying position. However, even if there is no property crash, serious problems are still associated with a property market that continues to rise. As we have heard, affordability is a problem for local young families in many parts of the United Kingdom. For that reason
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  alone, I urge the Government to be cautious about creating such a method for investing in property using pension funds.
  The average age of first-time buyers is rising in the UK. It is now 36 in Wales and 33 across the UK. That may shock hon. Members. In a sense, one's own property has always been a major part of saving for the future. Certainly in this country, a mortgage has been a way to avoid rental expenditure later in life. First-time buyers are increasingly crowded out of the housing market because older, more affluent people are using it as an investment vehicle by buying second or third homes. There are 10,000 people in London with more than 30 homes each and there are thousands more with more than 10 homes. We are crowding out young people from making the most important investment for the future—buying their own home.
  I am trying to be constructive; I can understand the rationale for making a wider portfolio of assets available for pension investment because of the pensions crisis, but the SIPPS mechanism that the Government are choosing is not the best means of proceeding. With interest rates rising and probably set to rise further, the timing is certainly very dangerous, given what we all know about the state of the housing market.
  6.54 pm
  Mr. Richard BaconIt is a pleasure to have the chance to take part in this debate and to follow the hon. Member for East Carmarthen and Dinefwr (Adam Price), to whom I listened with interest.
  The Chief Secretary, who is now back in his place, began the debate by saying that he looked around the Chamber and saw lots of graduates of previous Finance Bills. I have to say that I felt distinctly like an undergraduate at that point because this is my first Finance Bill, so I thought that it would be sensible to restrict my comments to two narrow issues that concern me, and to one rather broader issue. The first of the two narrow points is one on which I am concerned that the Government are not doing enough: their policy on the duty on biofuels. The second—the Government's proposals on duty stamps for whisky—is of huge concern to the hon. Member for Moray (Angus Robertson) and other Scottish Members, and to any single malt whisky drinker. I regret to say that we in South Norfolk have no distilleries, but we have a gratifyingly large number of microbreweries.
  It is increasingly widely, albeit not universally, known that one can make fuel for cars or lorries from wheat, barley, sugar beet and oilseed rape—and from single malt whisky, I suppose, if one were sufficiently desperate. Such fuel has huge benefits in terms of the environment and fuel security, and it benefits the rural economy and farming constituencies such as mine. There is a good case on a wide variety of grounds for encouraging the development of a biofuels industry in this country. Fuel security has not been a great concern in the past, but in the increasingly uncertain world in which we live, its importance is growing.
  I pay tribute to my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard), who has campaigned assiduously on this issue, which has extensive cross-party support within the House, and

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  widespread support from outside bodies including the National Farmers Union, the Road Haulage Association, the British Chambers of Commerce, the Confederation of British Industry and Friends of the Earth—not bodies often seen on the same side of an issue. There is a general view that although the 20p per litre duty reduction on biofuels announced by the Government is a welcome step in the right direction, it is not enough to stimulate the development of a serious biofuels industry in this country.
  The Government frequently repeat their commitment to reducing emissions of greenhouse gases, but research undertaken by Sheffield Hallam university suggests that conventionally produced bioethanol could produce a reduction of 60 per cent in carbon dioxide emissions, and British Sugar research indicates that efficient production methods could increase that figure to 70 per cent. However, to achieve those benefits, we need a biofuels industry. The Government have stated their intention to meet the renewable fuels targets by 2020 and the requirements of the EU biofuels directive by 2005, but those targets will not be met with the UK biofuels industry in its present state.
  The main effect of the Government's duty proposals on biofuels will simply be to suck in imports. Now, oilseed rape is grown in this country, put on a lorry and exported to Germany—the transport generating carbon emissions. There, it is turned into biofuel and reimported to this country to take advantage of the tax break that the Government have introduced. That is ludicrous. It has happened because the German Government introduced a larger tax break to get a serious manufacturing industry up and running. Everyone accepts that the tax break would not have to last for ever. It could tail off. However, at present it is widely understood that the Government's proposed 20p per litre duty cut is not enough even to get the industry in this country started.
  We have to create our own industry. The Curry report on the future of farming, which was commissioned by the Government themselves, refers to biofuels, saying that England—I apologise to Welsh and Scottish Members, but agricultural matters are devolved—
  "needs a long-term strategy for creating and exploiting opportunities in non-food crops, including starch and oils. This area should be a high priority for the research and technology transfers we have outlined. We recommend that the Government should reduce duty on biofuels to that charged on other clean fuels. We believe this will help processors to drive the market forward".
  Lord Whitty, a Minister in another place, has said that the 20p reduction on offer is not enough to deliver the investment needed to create a viable industry and achieve the outcomes that everyone would like. It is disappointing, given the chance to develop an exciting industry that would help the rural economy and the environment and improve our fuel security, that more is not being done to foster that opportunity. I therefore hope that the Government will reconsider their position.
  Clause 4 deals with duty stamp on spirits, an issue that I raised with the chairman of Customs and Excise when he gave evidence to the Public Accounts Committee.
  Angus Robertson: It was unconvincing.
  Mr. Bacon: Curiously enough, that is the same word as I have written down—the chairman was less than
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  fully convincing. The Government have accepted in their regulatory impact assessment that upfront costs to the industry will be £25 million. On top of that, there are annual costs of £60 million—or £54 million, if one believes the Government's figures. On any count, however, there are significant ongoing costs. The value of the stamp is about —5.48 a bottle, so it should be treated not as a piece of paper but as currency. The Government's proposals have security implications, and there are concomitant security costs.
  The Government have made much of the fact that the duty will be frozen for the remainder of this Parliament, but that has no impact on the set-up costs of £25 million that the industry has to find. The proposal raises a number of questions. In his opening remarks, the Chief Secretary referred to the arrangements for deferring duty, which have serious implications for companies' cash flow. It would be helpful if he could tell us when we will have more information, because the Government's proposals for deferring duty are vague, to say the least. The Government have also said that they will "look at" proposals for paying for printing, distribution and security costs, but they have not given a firm commitment, so more detail would be welcome.
  Angus Robertson: The hon. Gentleman has clearly read a lot of background documentation as well as the regulatory impact assessment. Has he been able to identify in that documentation an assessment by the Treasury or Customs and Excise of the projected levels of fraud on strip stamps, a practice that is unfortunately common in the few countries that still use them on spirits?
  Mr. Bacon: The hon. Gentleman makes a good point. Funnily enough, I have not done so, but he anticipates the point that I am about to make. Many countries do not have strip stamps because they are worried about fraud, as I shall explain in a minute. First, however, I have a couple of questions for the Government. They have said that there will be a capital fund of £3 million for small distilleries. It would be helpful to have confirmation that that is the right figure and, if it is not, to know how much will be available. What are the thresholds, and what constitutes a small distillery? The fundamental question, to return to the point made by the hon. Member for Moray, is whether this is going to work. There is no point in doing anything if the proposal will not work, will be open to fraud and, indeed, act as an incentive to commit fraud. The Government must consider the international context, because experience suggests that high-quality forgeries quickly become commonplace. With duty at £5.48 a bottle there is a strong incentive to commit forgery.
  The Government should consider the fact that Ukraine reformulated its tax stamps on 1 January 2004 in an effort to defeat fraud on the existing stamps. Within three weeks, the Ukrainian police reported seizures of 60,000 bottles of illicit spirits, each marked with forgeries of the newly introduced state-of-the-art

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  holograms. In Hungary, it is believed that 15 to 20 per cent. of the market is illicit. Several countries have either abolished the tax stamps regime—
  Angus Robertson: Such as the United States.
  Mr. Bacon: Indeed; and Ecuador and Greece. Others such as Belgium, Norway and Germany, have pulled back from introducing them.
  There is evidence from central and eastern Europe that genuine tax stamps can be used to disguise breaks in the seals after refilling, and that unscrupulous traders use stamps to add authenticity to counterfeit products and thereby steal sales from legitimate producers. The obvious beneficiaries of the Government's proposal will be overseas fraudsters and counterfeiters. Tax stamps will form a barrier to trade and will damage the ability of the whisky industry to compete globally. The market will be fragmented and producers will have to maintain UK-specific stocks, which will reduce the efficiency of the production line and increase costs, all for the sake of a measure that most expert observers believe is not likely to work in practice.
  I turn to my one slightly broader point—the context for the debate about tax and spending. Most people have no idea how much money the Government waste— how much of the tax that they take from us as citizens and businesses goes to waste. In a recent study the National Audit Office suggested that just a 1 per cent. improvement in the way in which the Government spend the money available over the next three years would result in £14.5 billion of extra spending for frontline services.
  I notice the hon. Member for Dagenham (Jon Cruddas) smiling at that. He is thinking of a very good article that he read in The Daily Telegraph a few months ago—at least, I thought it was rather good, but I suppose I can be forgiven for that because I wrote it— and he thinks that I am about to quote from it, as he did in a debate not long ago. He is absolutely right. Unless they bother to examine the issue closely, no one really understands just how much money the Government waste.
  We know about the central Government administration costs going up from £14.8 billion to just under £21 billion—at least, we thought it was just under £21 billion, until we picked up the Financial Times this morning and found out that the figure has exceeded even the Government's estimates by £1 billion. They expected it to go up by about £5 billion or £6 billion, but it has gone up by £1 billion more than the Government expected it to go up at this point. A year ago the bill was planned to be £20.2 billion, and it is now £21.3 billion.
  That is just the icing on the cake. The marzipan and the fruit, which mostly do not get noticed, are things like the fact that the Department for Work and Pensions has had its accounts qualified every year since 1988, and loses between £3 billion and £7 billion a year in fraud, depending on which Government figure one believes. In the 1998 White Paper on safeguarding social security, the Government said the figure was up to £7 billion. They now think it is only about £3 billion. They are the same Government who, five years ago and two years
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  before that, were asked whether housing benefit fraud was going up or down and could not say. Still now, if one asks the Department for Work and Pensions whether housing benefit fraud is going up or down, the Department cannot say. It only knows that it loses a huge amount of money from it.
  There are 40 Apache helicopters worth £1.2 billion sitting in warehouses in Wiltshire. It is costing £6 million to store them because the Ministry of Defence forgot to train the pilots in time. When I wrote the article, Customs and Excise—the responsibility of the Economic Secretary—was losing between £7 billion and £10 billion a year through VAT fraud. The figure is now £12 billion, and as the Economic Secretary knows, it loses a whole lot more through excise fraud. He will say that that is why the Government are introducing the strip stamps, but if those will not work—the international evidence suggests that they will not work—they should find a better way of achieving their aim.
  Each year we spend £240 million a year training teachers, yet £100 million of that goes on teachers who never set foot in a classroom once they have qualified and are never employed by a local education authority or a school. People know to some extent about the computer messes that occur in Government, but they might not be aware of the scale of the spending that goes on and the scale of the waste. The Government Communications Headquarters moved its computer from the old building to the new building. GCHQ thought it would cost £40 million to move the computer, so it told the GCHQ board that it would cost £20 million. It ended up costing £400 million.
  The Emslie report inside the health service said that the Government lose between 16 and 20 per cent. of their budget in the health service each year through waste, fraud, inefficiency and mismanagement. That is the context in which we must discuss the Government's claims that the Conservative party could not find savings. The assistant Chief Whip, my hon. Friend the Member for Mid-Worcestershire (Mr. Luff), suggests that I have spoken for long enough—he is probably right—although we can continue the debate until any hour. Labour Members claim that we cannot find the resources to improve public services, but huge waste is occurring, and it is about time that a Conservative Government put that right.
  7.10 pm
  Mr. Alan Reid: Like the hon. Member for South Norfolk (Mr. Bacon), I am against the introduction of tax stamps on bottles of spirits. I note that the proposal is contained in clause 4, which the Labour Government should definitely abolish.
  My constituency relies on the whisky industry to provide jobs, many of which are in remote, rural communities where alternative employment would be impossible to find—many of those jobs are on the islands of Islay and Jura. I did not recognise the rosy economic picture painted by the hon. Member for Western Isles (Mr. MacDonald), and if people lost their jobs in the distilleries, there are not large numbers of job vacancies for them to walk into. In my constituency, single distilleries are located in Oban, Campbeltown and Tobermory, a further eight are situated on Islay, and

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  there is one on Jura. The distillery on Jura is the main employer on the island, so any proposal that damages the whisky industry would devastate that economy.
  It is patently obvious that the tax stamp proposals will damage the competitiveness of the Scotch whisky industry, although it is important to remember that it will not be the only industry involved, because the gin and vodka industries will also be affected.
  Mr. David Heath: And cider brandy.
  Mr. Reid: The issue concerns more than jobs in distilleries, because the whisky industry provides many jobs in bottling plants, which are often located in urban areas where it is difficult to find other jobs. The tax stamp will also affect the constituency of the hon. Member for South Norfolk, because much of the barley used in the distilling process is sourced from East Anglia.
  It is clear that there is a problem with duty fraud, but it is dubious whether it occurs on the scale claimed by the Government. We must tackle fraud where it occurs, but we must also ensure that the benefits of any antifraud measure outweigh the costs of its introduction. The Scotch whisky industry is also interested in stamping out fraud: it rose to the challenge that the Chancellor set for it in the pre-Budget statement last November, and it has come up with a raft of anti-fraud measures that are far less costly than the tax stamp measures in clause 4.
  The Government proposals relate to three uncertain points—the level of duty fraud, the impact of tax stamps on fraud and the cost of tax stamps to the whisky industry. There is simply not enough evidence to demonstrate that the benefits of such a scheme would outweigh those costs, so it should not be introduced in this Bill. The risks to the economies of small, remote communities far outweigh the positive benefits to the Treasury.
  I shall examine the Government estimates of duty fraud, which are arrived at by gap analysis—using consumer surveys to estimate consumption and subtracting the recorded legitimate trade. Gap analysis relies on consumers accurately remembering their consumption. Remember, we are discussing alcohol—I see that the Financial Secretary is laughing—and gap analysis relies on people accurately remembering their consumption in order to work out the level of fraud, so the margin of error is clearly wide. The Government rely on the Customs and Excise estimate of £600 million of spirits duty fraud in 2001–02.
  However, when the National Audit Office conducted an investigation, it found a massive degree of uncertainty and concluded that a proper reporting of the Customs and Excise study would show that duty fraud was somewhere between £330 million and £1,080 million, not the single figure of £600 million quoted by the Government. The NAO also investigated the gap analysis estimates calculated by the Scotch whisky industry and concluded that its survey estimated the level of duty fraud at somewhere between £10 million and £260 million—considerably less than under the Customs and Excise methodology. The NAO found both methodologies to be theoretically "appropriate". It
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  is obvious, however, that both could not be correct, so faced with two widely conflicting estimates, it sensibly concluded that
  "great care is needed in determining what reliance is to be placed on the results that are presently available."
  Even further doubt was cast on Customs and Excise's methodology for estimating duty fraud by the fact that its annual report for 2002–03 noted that the gap analysis method found that duty fraud on beer was negative. The only conclusion that one can draw from that is that beer drinkers remember drinking a lot less, whereas whisky drinkers remember drinking a lot more. Perhaps whisky is better value for money. The NAO's conclusion that we need to use great care with regard to the Customs and Excise estimates is a warning that the Government should heed. It is important to bear in mind that estimating the level of fraud is not just a theoretical exercise, because if the Government have overestimated it, the reduction in fraud that tax stamps will bring is similarly overestimated.
  As regards the tax stamp's potential impact on fraud, the evidence from abroad is certainly not encouraging. A wide range of countries have introduced tax stamps or thought about doing so and found that they simply do not work. That is why the United States decided to abandon its tax stamp scheme 20 years ago. When Norway considered introducing a scheme, the British Government of the time wrote to their Norwegian counterparts to recommend that they did not do so because it would not work. The hon. Member for South Norfolk mentioned Ukraine, where a new stamp with a hologram seal similar to the one the Government are considering was introduced, yet within a few weeks 60,000 bottles of vodka with very good forged stamps were found. The Government themselves do not seem to think that the tax stamp will have a dramatic impact on fraud. In their analysis report, they estimate that it will reduce fraud by only about a quarter—hardly a dramatic reduction.
  We all know that forgeries will be so good that it will take an experienced Customs and Excise officer to spot them. Ordinary shopkeepers and customers will be taken in, so raids on shops by Customs officers will still be necessary. As we know from evidence given by Customs and Excise to Select Committees, such raids are already able to detect fraud. For example, when officers recently carried out an exercise in the London area, they visited 300 retail premises and found illicit spirits in nearly half of them. What extra benefits will tax stamps bring when current methods can already detect illicit spirits in the shops? Those raids, which involve targeting sectors of the trade that are suspected of being involved in fraud, are surely a better way to detect it than introducing an expensive tax stamp scheme. That is only one of a whole raft of alternatives suggested by the Scotch whisky industry.
  Another proposal involves warehouse keepers providing information to Customs about expected arrivals and advising it of which consignments do not arrive. The reason behind that is that lorry drivers who smuggle into the country spirits on which UK duty has not been paid often book their load into a warehouse as a precaution in case they are stopped and questioned by Customs at the port. If they are stopped, they take their load legitimately to the warehouse, but if they get through without being stopped, they deliver their goods

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  straight to the retailers. If criminals knew that repeated failure to turn up at a warehouse would attract suspicion, that smuggling method would be eliminated.
  The Government estimate that the package of measures that the Scotch whisky industry proposes would reduce fraud by approximately £70 million a year and that tax stamps would lead to a reduction of around £160 million. Even if the Government's estimates are correct, tax stamps would save only £90 million more than the Scotch whisky industry's suggestions. Their estimate of the annual cost to the industry is £54 million on top of the one-off capital cost of £23 million. Even if all the estimates are correct, the amount of savings that can be expected is low. Of course, there is grave concern that they are far from correct.
  So far, the Government have not attempted to estimate security, which worries the industry a great deal. Each tax stamp is a small piece of paper worth £5.48. The industry will therefore have to hold a large number of what are effectively £5 notes on its premises. Many bottling plants are on out-of-town industrial estates and they would have millions of pounds in £5 notes on their premises. The tax stamps are as good as cash to any thief who steals them. What sane company would store millions of pounds in £5 notes in a factory on an out-of-town industrial estate? The police are always telling us to put cash in the bank and not to leave it stored on premises, because of the costs of security. The insurance industry is reluctant to store cash, and insurance premiums to the whisky industry will rocket.
  Stamps will create problems on the production line. The machinery that puts the stamp on the bottle is complex. Bottles will have to be monitored as they come off the production line to ensure that two stamps have not stuck together and been affixed to one bottle. Torn stamps will cause problems. Some bottles will inevitably get broken after the stamp has been affixed. Claiming back the costs of stamps on broken bottles and torn stamps will involve costly administrative procedures.
  We do not know the scale of the problem that the Government are trying to solve, how effective their proposed solution will prove, or the full costs of the scheme. However, we know that great risks are involved. Should the Scotch whisky industry have to cut back its production because of costs, the outcome will be devastating for the economies of small rural communities such as those on Islay and Jura. I appeal to the Government to ditch clause 4 and not to proceed with tax stamps but to adopt the whisky industry's alternative package.
  7.23 pm
  Mr. Mark Prisk: The debate has been informed, surprisingly wide-ranging and extended. I welcome the Chief Secretary to his place. He began the debate in theatrical and entertaining style and it is nice to see him back on his old form. His speech was followed by a thorough and economically robust speech by my hon. Friend the Member for Arundel and South Downs (Mr. Flight). The Chief Secretary's speech was economically lacking but the entertainment is always worth it.
  My hon. Friend's speech was followed by three excellent Back-Bench contributions from my hon. Friend the Member for Grantham and Stamford
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  (Mr. Davies), my right hon. Friend the Member for Fylde (Mr. Jack) and last, but by no means least, the undergraduate on the Bill, my hon. Friend the Member for South Norfolk (Mr. Bacon). I look forward to their contributions in Committee.
  This year's Bill is longer than ever, if that can be believed. It includes 40 schedules and 310 clauses and extends to 574 pages. The explanatory notes alone stretch to more than 650 pages. As the Chief Secretary suggested, it will keep us busy, and I suspect that the undergraduate is beginning to wonder what he has let himself in for. Not only has the Bill got bigger, but the taxes that it covers will increase, too. Despite all the gimmicks and giveaways, and the spin and the gloss of the Budget day speech, the unvarnished truth is that, over the next 12 months, the nation's tax bill will rise by almost 8 per cent. The overall effect of the Budget and of the Bill will be an 8 per cent. rise in tax yield next year, and almost 8 per cent. more the year after. Indeed, the Red Book shows that the Government are planning for the burden of tax to reach its highest level for more than a quarter of a century by 2008. No wonder everyone is warning about Labour's third-term tax rises.
  Our taxes had been rising steadily under Labour even before the Bill. The net effect of the previous seven Budgets and Finance Bills equates to an extra £5,000 per household per year. That is 60 stealth tax rises in seven Budgets, and this year, the Chancellor has slipped in six more stealth taxes. In this Bill, there is a new tax on small companies, a tax on UK businesses for transfer pricing, a tax rise on red diesel, a tax hike on other road fuels, a new tax on trusts and a sixfold tax rise on company vans.
  The greatest act of stealth by the Chancellor came not in those specific changes but in his announcement of frozen tax thresholds and allowances. At the time, he made the tax freeze sound like an act of pure generosity, yet by freezing tax allowances and thresholds in the Bill, he is using the oldest stealth tax of all: fiscal drag. Let us take stamp duty land tax, a favourite of the Chief Secretary. When the Chancellor told the House that he was freezing stamp duty, Labour Members cheered; some even waved their Order Paper in support. But what they failed to understand—and what he forgot to mention—was that, as house prices rise, home buyers' tax bills will rise. To be more precise, the Chancellor expects people to pay £1,900 more in stamp duty next year. What Labour Members cheered on Budget day was a tax hike for first-lime buyers. What they endorsed would mean thousands more key workers being priced out of a home. The Chancellor might be able to fool Labour Members, but he will soon learn that he cannot fool those whom they represent.
  There will be tax increases, but there is another cost at the heart of the tax system under this Government. As the very length of this legislation shows, our tax system is now hideously complex. It has become an expensive burden in its own right. For example, the plan to impose strip stamps on spirit bottles represents a huge increase in costs for the industry, and we have heard Members on both sides of the House seriously urge the Treasury to think again about that proposal.
  The complexity of our tax system stems largely—although not wholly—from a Chancellor who constantly meddles and tinkers with each and every tax, duty and charge. Every year we get a raft of new

  259
  schemes, every Budget produces different rates and credits and every Finance Bill brings more and more rules. Let us take the new tax on small companies, as set out in clause 28. In 2002, the Chancellor cut the corporation tax starting rate from 10 per cent. to zero. Indeed, the Paymaster General actively promoted the change. She said in the Standing Committee that small businesses would not look a gift horse in the mouth. Thousands of businesses took her at her word and incorporated. Indeed, her encouragement was so magnificently successful that 300,000 firms incorporated.
  Unfortunately, that was far more than the Treasury had budgeted for. Suddenly, the Paymaster General's gift horse was beginning to look a little lame. So, in the Budget last month, the whole policy was reversed, with a 19 per cent. tax rate being imposed on many of the smallest companies. Indeed, we are now told that this was not a gift horse at all, but a loophole. What remarkable genius. Only this Government—perhaps only this Paymaster General—could miraculously transform a gift horse into a loophole in 18 months. That is a remarkable achievement.
  Yet the Government were warned of their error at the time. The recent Budget report by the Treasury Committee states:
  "We are puzzled as to why, unlike other commentators, neither the tax authorities nor the Treasury anticipated that this would be the likely effect".
  The Committee's report that goes to say that the cost to the taxpayer was an estimated £670 million in lost revenues.
  In a sense, the cost to business is probably far greater. There are the professional costs of accountancy advice and changing accounts, and the costs of the time lost in that process. But perhaps the greatest price to the UK economy is the uncertainty that this incompetent meddling has created. How are businesses meant to plan ahead when the tax system keeps changing? How can companies invest when they do not know how their investments will be taxed? Perhaps most important of all, what assurances can the Paymaster General give that some of the reliefs and many allowances in this Bill that she and her colleagues have applauded will not also soon be suddenly denounced as loopholes?
  Conservative Members fully accept that seeking to evade legitimate tax liability is illegal and should be dealt with accordingly, but there is a world of difference between illegal tax evasion and tax avoidance or planning. Indeed, I understand that that was once the Labour party's view. Preparing for the debate, I came across a fascinating document, Labour's policy paper "Tackling Tax Abuses, Tackling Unemployment"—a snappy title. It was written when the Chancellor was still the shadow Chancellor. Under the heading, "How avoidance can be countered", it states:
  "The taxpayer is entitled to take advantage of the law to minimise his or her tax bill."
  It goes on
  "as a matter of principle"
  —not a phrase that we hear often from Labour Ministers nowadays—
  "we believe that the citizen is entitled to know where he or she stands before the tax law."
  260
  It concludes:
  "It is the complexity of the present system that has encouraged the growth of a flourishing avoidance industry."
  For once, I agree with the stated policy—as it must have been then—of the Labour party and its supporters, but what is the Paymaster General's view? Does she agree with the Chancellor's view then, or with his actions now? Does she accept that people are entitled to ensure that they pay only the tax that they owe? Does she understand that ceaseless change leaves taxpayers unclear about where they stand? Will she agree in her reply that the more complex the tax law, the greater encouragement there is for tax avoidance?
  The Bill represents a wasted opportunity, which is why I urge all Members to support the amendment. It could have presented a radical plan to help savers and reduced the complexity and burden of the tax system. Yet, instead of helping enterprise, it stings small companies and the self-employed. Instead of helping home owners, it increases the tax burden of first-time buyers. Instead of simplifying our tax system, it adds 574 pages of complex rules and regulations.
  Never has a Finance Bill been so long, and said so little of substance. Long on words, short on vision: that is the reality of this Bill, and that is the record of this Chancellor.
  7.33 pm
  The Paymaster General (Dawn Primarolo): I thank all Members who have spoken. It has been a good debate. At the beginning, Opposition Members asserted that this was a dull Finance Bill, but during the afternoon and evening they got quite worked up. I agree with the hon. Member for Hertford and Stortford (Mr. Prisk) that the debate was wide-ranging.
  My hon. Friends the Members for Newcastle upon Tyne, North (Mr. Henderson) and for Bexleyheath and Crayford (Mr. Beard) rightly pointed out that sustained growth has been combined with low inflation, low interest rates and the lowest levels of unemployment for a generation. New employment figures show that, since 1997, more than 1.8 million jobs have been created and that, every working day, 600 businesses start up. Instead of the record under the previous Government, when we were first in and last out in downturns in the economy, it is right to conclude, as my right hon. Friend the Chancellor did in his Budget statement, that the UK has weathered the global downturn and will continue to grow in 2004.
  Our economic stability, matched by sustained growth and a sound and fair tax system, allows us to commit more investment not less to public services and to choose long-term investment, which matters most to the people of this country. As the hon. Member for Yeovil (Mr. Laws) rightly said, economic stability provides a secure background against which we can consider in greater depth public services, unlike in the 1980s, under the previous Government, which were dominated by bankruptcy, unemployment, house repossession, Government debt and disaster for millions of families. The Finance Bill will build on those economic strengths for the future and prepare the UK for the challenges of the future.
  I want to deal with pension simplification and the points made by the hon. Members for Arundel and South Downs (Mr. Flight) and for East Carmarthen and

  261
  Dinefwr (Adam Price). Basically, the hon. Member for Arundel and South Downs misunderstood completely the pension simplification arrangements. He said that we are replacing eight pensions with six. Clearly, he is confused about the fact that there will be only one regime for taxation, which replaces the existing eight. It is only right that there should be a variety of schemes to meet the range of needs. He went on to say—I do not know whether he was suggesting that we should have different valuation factors—that the single valuation factor was somehow unfair. I know that he must appreciate, as he is knowledgeable on these subjects, that a single valuation factor ensures that administration of the schemes is kept simple. Surely he does not propose that we make it more complex.
  Both the hon. Gentleman and the hon. Member for Hertford and Stortford (Mr. Prisk), in winding up this debate, complained about the length of the Finance Bill. As they well know, the pension simplification alone replaces approximately 350 pages of existing legislation, along with thousands of pages of guidance and has been widely welcomed, particularly as it puts back the implementation date to 2006. The point made about women on maternity leave or in career breaks is absolutely wrong. What we have is simplification. The rule that was referred to is no longer needed, as women are not restricted and can contribute more before and after their career breaks, providing much more flexibility and the ability to save more.
  On the point made by the hon. Member for East Carmarthen and Dinefwr about second homes and the housing market—clearly, we will debate the issue in more depth in Committee—it is simply not true that our proposals will encourage speculative investment. There was much misunderstanding in the early stages and I know that he has quoted in good faith the points that others are making. Now that the proposals are clear to them, I think that he will find that his concerns are misplaced. I look forward to that debate.
  I congratulate the right hon. Member for Fylde (Mr. Jack) on running in the London marathon and I am sorry that I was not there to cheer him on his way past the Treasury. I want to touch on his points with regard to avoidance and whether Parliament has got it wrong. That is a crucial debate, on which the hon. Member for Hertford and Stortford touched in his closing remarks. In 1997, Lord Nolan described avoidance as
  "when a taxpayer reduces his liability to tax without incurring the economic consequences that Parliament intended to be suffered by any taxpayer qualifying for such a reduction in his tax liability. Tax avoidance is a course of action designed to conflict with or defeat the evident intention of Parliament".
  Of course, we would expect all individuals and companies to want to make the most efficient use of the tax system and its reliefs, but we have seen systematic, abusive schemes that give relief for economic activity that was never undertaken or multiple reliefs for the same action that was never intended. The right hon. Gentleman talks about losses or capital allowances and how they are being used now. He cannot seriously be
  262
  suggesting that we take out of our tax system all the capital allowances or lease proposals that so help business to deal with the point.
  Mr. Jack: My purpose in illustrating my concern about clause 290 was not in any way to challenge the efficacy of capital allowances, but merely to probe how clause 290 would operate in the example that I gave.
  Dawn Primarolo: The debate in Committee—on which I hope the right hon. Gentleman will serve—will enable all hon. Members to draw a clear distinction between legitimate tax planning, avoidance and evasion and allow us to discuss how we should respond to these challenges in fairness, treating all taxpayers on an equal basis.
  Both the right hon. Member for Fylde and the hon. Member for Arundel and South Downs asked about legal privilege and whether it was our intention to override it—it is not—and about the regulations that will provide for the disclosure. The regulations will be made available before we get to that part of the Standing Committee. There will be consultation on them, because it is our intention to try to make sure that this works, for exactly the reasons that everybody in this House would expect.
  On transfer pricing, I understand the CBI's concern, but we have consulted it and have made changes to the transfer pricing rules, which was a sensible response.
  Many hon. Members referred to strip stamps. The simple point is that, after nearly three years of discussion and consultation with the industry, given the increased fraud and the illicit market in this area, no alternative solution could be found. We can debate that on the Floor of the House in detail next week, but hon. Members need to apply themselves to this fact: why should honest taxpayers see a loss in revenue because of illegal activity? If that is wrong, how do we deal with it? I must say that the industry has not come forward with any alternative proposals.
  Mr. Alan Reid: The Government's own regulatory impact assessment estimates that the industry's proposals would save £70 million a year.
  Dawn Primarolo: That is less than half the tax yield. We have to address that matter in this House. The hon. Gentleman cannot have it both ways and he needs to face the challenge square on.
  A modern and fair tax system that encourages work, keeps pace with developments in business practice and in the global economy and raises sufficient revenues to fund the Government's objective of building world-class public services is what this Finance Bill provides for. As my hon. Friend the Member for Wallasey (Angela Eagle) said, a strong economy is a platform for a fair and secure society for all, with jobs and investment in public services, innovation and science. The Bill is both responsive to and realistic about the challenges that this country faces in competing in the world economy.
  Let us compare that with the policies of the Conservative party. The expenditure cuts, undermining vital public services, proposed by the shadow Chief

  263
  Secretary would bring a return to the underinvestment, insecurity and disaster of his party's economic policy in the 1980s and early 1990s.
  Our vision is for a Britain that supports fairness, security and opportunity for all. The Finance Bill builds on a platform of economic stability and I commend it to the House.
  Question put, That the amendment be made:—
  The House divided: Ayes 190, Noes 301.

  Division No. 133]

  [7:45 pm

  AYES

  Amess, David

  Flook, Adrian

  Ancram, rh Michael

  Forth, rh Eric

  Atkinson, David (Bour'mth E)

  Foster, Don (Bath)

  Atkinson, Peter (Hexham)

  Fox, Dr Liam

  Bacon, Richard

  Francois, Mark

  Barker, Gregory

  Garnier, Edward

  Baron, John (Billericay)

  George, Andrew (St. Ives)

  Barrett, John

  Gibb, Nick (Bognor Regis)

  Beggs, Roy (E Antrim)

  Gidley, Sandra

  Bellingham, Henry

  Grayling, Chris

  Beresford, Sir Paul

  Green, Damian (Ashford)

  Blunt, Crispin

  Green, Matthew (Ludlow)

  Boswell, Tim

  Grieve, Dominic

  Bottomley, Peter (Worthing W)

  Hague, rh William

  Bottomley, rh Virginia (SW Surrey)

  Hammond, Philip

  Harvey, Nick

  Brady, Graham

  Hawkins, Nick

  Brazier, Julian

  Heald, Oliver

  Brooke, Mrs Annette L.

  Heath, David

  Browning, Mrs Angela

  Heathcoat-Amory, rh David

  Burns, Simon

  Hendry, Charles

  Burnside, David

  Hermon, Lady

  Burstow, Paul

  Hoban, Mark (Fareham)

  Burt, Alistair

  Hogg, rh Douglas

  Cable, Dr. Vincent

  Holmes, paul

  Cameron, David

  Horam, John (Orpington)

  Campbell, Gregory (E Lond'y)

  Howarth, Gerald (Aldershot)

  Campbell, rh Sir Menzies (NE Fife)

  Hunter, Andrew

  Jack, rh Michael

  Carmichael, Alistair

  Jackson, Robert (Wantage)

  Cash, William

  Jones, Nigel (Cheltenham)

  Chapman, Sir Sydney (Chipping Barnet)

  Keetch, Paul

  Key, Robert (Salisbury)

  Chope, Christopher

  Kirkbride, Miss Julie

  Clappison, James

  Kirkwood,Sir Archy

  Clarke, rh Kenneth (Rushcliffe)

  Knight, rh Greg (E Yorkshire)

  Collins, Tim

  Laing, Mrs Eleanor

  Conway, Derek

  Lait, Mrs Jacqui

  Cormack, Sir Patrick

  Lamb, Norman

  Cotter, Brian

  Lansley, Andrew

  Cran, James (Beverley)

  Laws, David (Yeovil)

  Curry, rh David

  Leigh, Edward

  Davey, Edward (Kingston)

  Lewis, Dr. Julian (New Forest E)

  Davies, Quentin (Grantham & Stamford)

  Lidington, David

  Lilley, rh Peter

  Davis, rh David (Haltemprice & Howden)

  Llwyd, Elfyn

  Djanogly, Jonathan

  Loughton, Tim

  Dodds, Nigel

  Luff, Peter (M-Worcs)

  Donaldson, Jeffrey M.

  Mclntosh, Miss Anne

  Dorrell, rh Stephen

  Mackay, rh Andrew

  Doughty, Sue

  Maclean, rh David

  Duncan, Alan (Rutland)

  McLoughlin, Patrick

  Duncan, Peter (Galloway)

  Maples, John

  Duncan Smith, rh lain

  Marsden, Paul (Shrewsbury & Atcham)

  Evans, Nigel

  Fabricant, Michael

  Mates, Michael

  Fallon, Michael

  Maude, rh Francis

  Field, Mark (Cities of London & Westminster)

  Mawhinney, rh Sir Brian

  May, Mrs Theresa

  Flight, Howard

  Mercer, Patrick

  264

  Mitchell, Andrew (Sutton Coldfield)

  Spicer, Sir Michael

  Spink, Bob (Castle Point)

  Moore, Michael

  Spring, Richard

  Moss, Malcolm

  Stanley, rh Sir John

  Murrison, Dr. Andrew

  Steen, Anthony

  Norman, Archie

  Streeter, Gary

  Oaten, Mark (Winchester)

  Stunell, Andrew

  O'Brien, Stephen (Eddisbury)

  Swayne, Desmond

  Öpik, Lembit

  Swire, Hugo (E Devon)

  Osborne, George (Tatton)

  Syms, Robert

  Ottaway, Richard

  Tapsell, Sir Peter

  Page, Richard

  Taylor, Ian (Esher)

  Paice, James

  Taylor, John (Solihull)

  Paisley, Rev. Ian

  Taylor, Matthew (Truro)

  Paterson, Owen

  Taylor, Dr. Richard (Wyre F)

  Portillo, rh Michael

  Teather, Sarah

  Price, Adam (E Carmarthen & Dinefwr)

  Thomas, Simon (Ceredigion)

  Turner, Andrew (Isle of Wight)

  Prisk, Mark (Hertford)

  Tyler, Paul (N Cornwall)

  Pugh, Dr. John

  Tyrie, Andrew

  Randall, John

  Waterson, Nigel

  Redwood, rh John

  Watkinson, Angela

  Reid, Alan (Argyll & Bute)

  Webb, Steve (Northavon)

  Rendel, David

  Weir, Michael

  Robathan, Andrew

  Whittingdale, John

  Robertson, Angus (Moray)

  Widdecombe, rh Miss Ann

  Robertson, Hugh (Faversham & M-Kent)

  Wiggin, Bill

  Willetts, David

  Robertson, Laurence (Tewk'b'ry)

  Williams, Hywel (Caernarfon)

  Robinson, Peter (Belfast E)

  Williams, Roger (Brecon)

  Rosindell, Andrew

  Willis, Phil

  Russell, Bob (Colchester)

  Wilshire, David

  Sanders, Adrian

  Winterton, Ann (Congleton)

  Sayeed, Jonathan

  Winterton, Sir Nicholas

  Selous, Andrew

  (Macclesfield)

  Shephard, rh Mrs Gillian

  Wishart, Pete

  Shepherd, Richard

  Young, rh Sir George

  Simmonds, Mark

  Younger-Ross, Richard

  Simpson, Keith (M-Norfolk)

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

  Tellers for the Ayes:

  Mr. Geoffrey Clifton-Brown

  Smyth, Rev. Martin (Belfast S)

  and

  Spelman, Mrs Caroline

  Mr. David Ruffley

  NOES

  Abbott, Ms Diane

  Byers, rh Stephen

  Ainger, Nick

  Caborn, rh Richard

  Ainsworth, Bob (Cov'try NE)

  Cairns, David

  Allen, Graham

  Campbell, Alan (Tynemouth)

  Anderson, rh Donald (Swansea E)

  Campbell, Ronnie (Blyth V)

  Anderson, Janet (Rossendale & Darwen)

  Caplin, Ivor

  Casale, Roger

  Atherton, Ms Candy

  Caton, Martin

  Atkins, Charlotte

  Cawsey, Ian (Brigg)

  Bailey, Adrian

  Challen, Colin

  Baird, Vera

  Chapman, Ben (Wirral S)

  Battle, John

  Clapham, Michael

  Beard, Nigel

  Clark, Mrs Helen (Peterborough)

  Begg, Miss Anne

  Clark, Dr. Lynda (Edinburgh Pentlands)

  Bennett, Andrew

  Berry, Roger

  Clarke, rh Tom (Coatbridge & Chryston)

  Best, Harold

  Betts, Clive

  Clarke, Tony (Northampton S)

  Blackman, Liz

  Clelland, David

  Blears, Ms Hazel

  Coffey, Ms Ann

  Boateng, rh Paul

  Cohen, Harry

  Borrow, David

  Coleman, Iain

  Bradley, rh Keith (Withington)

  Cook, Frank (Stockton N)

  Bradley, Peter (The Wrekin)

  Cook, rh Robin (Livingston)

  Bradshaw, Ben

  Cooper, Yvette

  Browne, Desmond

  Corston, Jean

  Bryant, Chris

  Cousins, Jim

  Buck, Ms Karen

  Cranston, Ross

  Burden, Richard

  Crausby, David

  Burgon, Colin

  Cruddas, Jon

  Burnham, Andy

  Cryer, Ann (Keighley)

  265

  Cummings, John

  Illsley, Eric

  Cunningham, Jim (Coventry S)

  Ingram, rh Adam

  Cunningham, Tony (Workington)

  Irranca-Davies, Huw

  Curtis-Thomas, Mrs Claire

  Jackson, Glenda (Hampstead & Highgate)

  Dalyell, Tam

  Davey, Valerie (Bristol W)

  Jackson, Helen (Hillsborough)

  David, Wayne

  Jamieson, David

  Davidson, Ian

  Jenkins, Brian

  Davies, rh Denzil (Llanelli)

  Johnson, Alan (Hull W)

  Davis, rh Terry (B'ham Hodge H)

  Jones, Helen (Warrington N)

  Dawson, Hilton

  Jones, Jon Owen (Cardiff C)

  Dean, Mrs Janet

  Jones, Martyn (Clwyd S)

  Denham, rh John

  Joyce, Eric (Falkirk W)

  Dhanda, Parmjit

  Kaufman, rh Gerald

  Dismore, Andrew

  Keeble, Ms Sally

  Dobbin, Jim (Heywood)

  Keen, Alan (Feltham)

  Dobson, rh Frank

  Kelly, Ruth (Bolton W)

  Donohoe, Brian H.

  Kemp, Fraser

  Doran, Frank

  Kennedy, Jane (Wavertree)

  Dowd, Jim (Lewisham W)

  Khabra, Piara S.

  Drew, David (Stroud)

  Kidney, David

  Dunwoody, Mrs Gwyneth

  Kilfoyle, Peter

  Eagle, Angela (Wallasey)

  King, Ms Oona (Bethnal Green & Bow)

  Eagle, Maria (L'pool Garston)

  Edwards, Huw

  Knight, Jim (S Dorset)

  Efford, Clive

  Kumar, Dr. Ashok

  Ellman, Mrs Louise

  Lammy, David

  Etherington, Bill

  Lawrence, Mrs Jackie

  Farrelly, Paul

  Laxton, Bob (Derby N)

  Field, rh Frank (Birkenhead)

  Lazarowicz, Mark

  Fisher, Mark

  Lepper, David

  Fitzpatrick, Jim

  Leslie, Christopher

  Fitzsimons, Mrs Lorna

  Levitt, Tom (High Peak)

  Flint, Caroline

  Linton, Martin

  Flynn, Paul (Newport W)

  Lloyd, Tony (Manchester C)

  Follett, Barbara

  Love, Andrew

  Foster, rh Derek

  Lucas, Ian (Wrexham)

  Foster, Michael (Worcester)

  Luke, Iain (Dundee E)

  Foster, Michael Jabez (Hastings & Rye)

  Lyons, John (Strathkelvin)

  McAvoy, Thomas

  Foulkes, rh George

  McCafferty, Chris

  Francis, Dr. Hywel

  McCartney, rh Ian

  Gapes, Mike (Ilford S)

  McDonagh, Siobhain

  George, rh Bruce (Walsall S)

  MacDonald, Calum

  Gerrard, Neil

  McDonnell, John

  Gibson, Dr. Ian

  MacDougall, John

  Goggins, Paul

  McFall, John

  Griffiths, Win (Bridgend)

  McGuire, Mrs Anne

  Grogan, John

  McIsaac, Shona

  Hall, Mike (Weaver Vale)

  McKechin, Ann

  Hall, Patrick (Bedford)

  Mactaggart, Fiona

  Hamilton, David (Midlothian)

  McWalter, Tony

  Hanson, David

  McWilliam, John

  Harman, rh Ms Harriet

  Mahmood, Khalid

  Havard, Dai (Merthyr Tydfil & Rhymney)

  Mahon, Mrs Alice

  Mallaber, Judy

  Healey, John

  Mann, John (Bassetlaw)

  Henderson, Doug (Newcastle N)

  Marris, Rob (Wolverh'ton SW)

  Henderson, Ivan (Harwich)

  Marsden, Gordon (Blackpool S)

  Hendrick, Mark

  Marshall, Jim (Leicester S)

  Hepburn, Stephen

  Marshall-Andrews, Robert

  Hesford, Stephen

  Martlew, Eric

  Hewitt, rh Ms Patricia

  Meacher, rh Michael

  Hill, Keith (Streatham)

  Meale, Alan (Mansfield)

  Hinchliffe, David

  Merron, Gillian

  Hoey, Kate (Vauxhall)

  Michael, rh Alun

  Hood, Jimmy (Clydesdale)

  Miliband, David

  Hope, Phil (Corby)

  Miller, Andrew

  Howarth, George (Knowsley N & Sefton E)

  Mitchell, Austin (Gt Grimsby)

  Moffatt, Laura

  Hoyle, Lindsay

  Mole, Chris

  Hughes, Beverley (Stretford & Urmston)

  Moonie, Dr. Lewis

  Moran, Margaret

  Humble, Mrs Joan

  Morgan, Julie

  Hutton, rh John

  Morris, rh Estelle

  Iddon, Dr. Brian

  Mountford, Kali

  266

  Mudie, George

  Skinner, Dennis

  Munn, Ms Meg

  Smith, Angela (Basildon)

  Murphy, Denis (Wansbeck)

  Smith, rh Chris (Islington S & Finsbury)

  Murphy, Jim (Eastwood)

  Naysmith, Dr. Doug

  Smith, Geraldine (Morecambe & Lunesdale)

  O'Hara, Edward

  Olner, Bill

  Smith, Llew (Blaenau Gwent)

  Organ, Diana

  Soley. Clive

  Osborne, Sandra (Ayr)

  Southworth, Helen

  Owen, Albert

  Spellar, rh John

  Palmer, Dr. Nick

  Starkey, Dr. Phyllis

  Pearson, Ian

  Steinberg, Gerry

  Perham, Linda

  Stewart, David (Inverness E & Lochaber)

  Picking, Anne

  Pickthall, Colin

  Stewart, Ian (Eccles)

  Pike, Peter (Burnley)

  Stinchcombe, Paul

  Plaskitt, James

  Stringer, Graham

  Pollard, Kerry

  Stuart, Ms Gisela

  Pond, Chris (Gravesham)

  Sutcliffe, Gerry

  Pope, Greg (Hyndburn)

  Taylor, Dari (Stockton S)

  Pound Stephen

  Taylor, David (NW Leics)

  Prentice, Ms Bridget (Lewisham E)

  Timms, Stephen

  Tipping, Paddy

  Prescott, rh John

  Todd, Mark (S Derbyshire)

  Primarolo, rh Dawn

  Trickett, Jon

  Prosser, Gwyn

  Truswell, Paul

  Purchase Ken

  Turner, Dennis (Wolverh'ton SE)

  Purnell James

  Turner, Dr. Desmond (Brighton Kemptown)

  Quinn, Lawrie

  Rammell Bill

  Turner, Neil (Wigan)

  Rapson, Syd (Portsmouth N)

  Twigg, Derek (Halton)

  Raynsford, rh Nick

  Twigg, Stephen (Enfield)

  Reed, Andy (Loughborough)

  Tynan, Bill (Hamilton S)

  Robertson, John (Glasgow Anniesland)

  Vaz, Keith (Leicester E)

  Vis, Dr. Rudi

  Robinson, Geoffrey (Coventry NW)

  Walley, Ms Joan

  Ward, Claire

  Roche, Mrs Barbara

  Wareing, Robert N.

  Rooney, Terry

  Whitehead, Dr. Alan

  Ross, Ernie (Dundee W)

  Wicks, Malcolm

  Roy, Frank (Motherwell)

  Williams, rh Alan (Swansea W)

  Ruane, Chris

  Williams, Betty (Conwy)

  Ruddock, Joan

  Wills, Michael

  Russell, Ms Christine (City of Chester)

  Winnick, David

  Wood, Mike (Batley)

  Ryan, Joan (Enfield N)

  Woodward, Shaun

  Salter, Martin

  Woolas, Phil

  Sarwar, Mohammad

  Worthington, Tony

  Savidge, Malcolm

  Wright, Anthony D. (Gt Yarmouth)

  Sedgemore, Brian

  Wright, David (Telford>)

  Shaw, Jonathan

  Sheridan, Jim

  Tellers for the Noes:

  Simpson, Alan (Nottingham S)

  Vernon Coaker and

  Singh, Marsha

  Mr. John Heppell

  Question accordingly negatived.
  Main Question put forthwith, pursuant to Standing Order No. 62 (Amendment on second or third reading), and agreed to.
  Bill accordingly read a Second time.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 63(3) (Committal of Bills),
  That Clauses Nos. 4, 5, 20, 28, 57 to 77, 86, 111 and 282 to 289 and Schedules 1, 3, 11 12, 21 and 37 to 39 shall be committed to a Committee of the whole House;
  That the remainder of the Bill shall be committed to a Standing Committee;
  That when the provisions of the Bill considered, respectively, by the Committee of the whole House and by the Standing Committee have been reported to the House, the Bill shall be proceeded with as if it had been reported as a whole to the House from the Standing Committee.—[Dawn Primarolo]
  Question agreed to.
  Committee tomorrow.

  Finance Bill
  Ordered,
  That, during proceedings on the Finance Bill, the Standing Committee on the Bill shall have leave to sit twice on the first day on which it shall meet.—[Mr. Jim Murphy.]

PETITION

  John Charles
  7.59 pm
  Lembit Öpik: I wish to present a petition that has been organised in association with the Wales on Sunday newspaper. It is about the late great John Charles, the Welsh footballer. The petition has 703 signatures, and has been supplemented by 440 names on the Wales on Sunday website.
  The petition states:
  To the House of Commons.
  The petition of readers of Wales on Sunday,
  Declares that the late John Charles made a huge contribution to football, sportsmanship and to Wales and that 703 people have recognised this and supported the petition through a newspaper campaign.
  The petitioners therefore request that the House of Commons urge the Prime Minister to recommend the late John Charles for a posthumous knighthood.
  And the Petitioners remain, etc.
  To lie upon the Table.

  Cider Apple Orchards
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Jim Murphy.]
  8 pm
  Mr. David Heath: Debate in the House is often about great matters of national or international policy. Occasionally, it is right that we debate perhaps smaller matters that affect fewer people, but about which certain people feel passionately. That is why I am so pleased to have this opportunity to represent my constituents in the Adjournment debate.
  Many people in Somerset feel deeply about the traditional cider apple orchards, which are such an important part of our landscape, environment, history and culture. The people who know them best are the growers and producers. I am indebted to constituents whom I saw at my surgery in Langport on Saturday. They include Mr. Fry of Long Sutton, and Messrs. Meaker, both senior and junior, of Pitney, as well as those to whom I spoke in Kingsbury Episcopi on Monday morning, including Mr. Male, Mr. Hebditch and Mr. Temperley. Many others have written either to me or to my hon. Friend the Member for Yeovil (Mr. Laws). Those people told me how worried they were that this year would see the loss of so many acres of precious orchards. Whether that fear is justified—I think that it is—it is genuinely held and needs a serious response.
  I suspect that the problem is well known to the Minister. This year sees the introduction of the new single farm payment scheme, and land must be registered by the end of 2004. Land given over to permanent crops—and apple orchards are specifically included in that definition—is not eligible for registration. Landowners are therefore in the unenviable position of having to decide within the calendar year whether to clear orchards and grub out their trees in order to register, or to forgo those payments in perpetuity.
  In the case of modern, commercial planting, grubbing up is unlikely to be the best option, but for those orchards that are marginal or past their peak of production, no responsible landowner could possibly ignore either the loss of income that in the current state of agriculture—particularly, I have to say, in parts of my constituency—might be critical to any profitability, or the loss of capital value that they would incur.
  Mr. Paul Keetch: I congratulate my hon. Friend on securing the debate. Does he agree that, given that the Government are committed to a mixed landscape and biodiversity in agriculture, any measures that have the effect of reducing biodiversity are, on the surface at least, contrary to Government policy? Does he hope that in his response the Minister will explain that apparent ambiguity in the system?
  Mr. Heath: My hon. Friend, who is the chairman and founder member of the parliamentary cider group, is absolutely right on that matter, to which I shall return.
  Mr. Bill Wiggin: I may have to register an interest, as in the next few weeks I hope to

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  buy a field containing apple trees. I hope that in his reply, the Minister will also say whether other European countries such as France are taking the same line as our Government—or will the French be subsidising their apple production while we do not do the same for our apple producers?
  Mr. Heath: I hope that the Minister will respond to the hon. Gentleman's question.
  Matters are made considerably worse by the uncertain state of the commercial-scale cider industry. Both Matthew Clark Cider and Bulmer are reducing the acreage under contract and many marginal orchards are unlikely to find ready markets. Nor will a reduction in total apple production restore apple prices and encourage replanting; history suggests that production shortfalls will be met by the importation of concentrate rather than enhanced domestic production.
  Why does that matter? I could wax lyrical about the beauties of Somerset orchards and I would be justified in doing so. They are a special part of our landscape and it is hard to imagine Somerset, or other parts of the west country, without orchards. That point has been made forcefully by the Countryside Agency, among many others.
  I could mention the environmental importance. The ecology of orchards is unique—a point made by my hon. Friend the Member for Hereford (Mr. Keetch)—and enormously valuable. English Nature has intervened in the debate and initiated studies to underline what it considers a hugely important managed natural resource. It has even mentioned the invertebrate, Gnorimus nobilis—the noble chafer. I have to confess that I do not know much about the noble chafer, but the environmental benefits of orchards are apparent even to those of us who are not entomologists. It is hard to think of another form of agricultural production that is so benign in environmental terms.
  Then there is the diversity of apple varieties. If we lose the older, more traditional orchards, we shall inevitably lose yet more of the myriad apple varieties unique to Britain. More than 156 apple varieties are recorded as having connections with Somerset alone, and their names are every bit as redolent and evocative of the county as any cultural artefact. They include varieties such as Yarlington Mill, Black Dabinett, Glory of the West, Slack-me-Girdle, Hoary Morning and Bastard Foxwhelp—I had better stop there, but I hope that I have made my point.
  The Minister for Rural Affairs and Local Environmental Quality (Alun Michael): The hon. Gentleman has mentioned many of his distinguished constituents and many species of apple, and it strikes me that he is making his case primarily in relation to traditional orchards. I should like us to be clear about that, as some of the public discussion seems to have confused traditional orchards with the more modern commercial growers. I should like my response to be accurate, so am I right in my interpretation of his remarks? Is he primarily concerned with traditional orchards?
  Mr. Heath: I am grateful to the right hon. Gentleman. Yes, I am concerned about the traditional orchards that
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  are so much part of our landscape, but there are also questions about the commercial orchards and I do not want to lose sight of them in this debate.
  Brian Cotter: My hon. Friend will know that there is a well known cider maker in my constituency, Thatchers Cider. Businesses have been encouraged to invest in this country because the Government have told them that there is stability, so it is very discouraging for Thatchers Cider to have invested in planting up a lot of orchards recently only to find that—as it were—the ground has been swept away.
  Mr. Heath: I am grateful to my hon. Friend for that comment. Over recent years, we have seen a welcome revival in the planting of orchards, which has been encouraged by the Government through agri-environmental schemes and also locally. Somerset county council has been active in promoting the replanting of traditional apple varieties. It is thus perverse that we are switching to reverse gear.
  Once those ancient varieties are lost, they are gone for ever; they will not be recovered. Genetic diversity is as important in arboriculture as in animal breeding, in which I declare some interest as, at one stage, I was a member of the Rare Breeds Association and bred a rare breed of pig.
  Is the loss inevitable? I think not. I know that the Department for Environment, Food and Rural Affairs has held discussions with representatives of the industry and others, and I hope that the Minister may be able to expand on the results.
  Let us deal with some of the possible avenues for escape. First, there is the definition of "permanent crop". There is some flexibility in the definitions. I understand—perhaps the Minister will confirm this—that the Department has already exempted some permanent crops, such as withies, hops and asparagus beds. If the definition is amendable in that form, why not do so with apple trees?
  One of the growers—a gentleman who was a commercial-scale grower—told me how absurd he thought it was that the raspberry canes that he had on part of his land were eligible for single farm payment grants, but the top fruit that he had on other parts of his land was not. Where is the logic in that? Another gentleman pointed out to me that, under the new scheme, someone who grows a field of potatoes—a very valuable crop, but not one with a great landscape value—will receive a benefit, but those who have beautiful orchards, whether of apple or cherry or whatever, will not. That seems perverse.
  Secondly, there is dual use. Orchards were never included, per se, in the integrated administration and control scheme, but traditional orchards are grown over a sward that is very often used for grazing. Under the old scheme, traditional cider orchards used for grazing for more than six months of the year qualified as forage acreage. Although those orchards did not qualify, per se, for subsidy, they were nevertheless included in the bundle. I understand that the Department is reconsidering the position on that—I hope that it is— because the arguments about dual use are just as pertinent now. I also hope that the Minister can give us some further thoughts on his conclusions.

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  Thirdly, although I have seen nothing in writing, there is talk of an upper limit on density as a working definition for what is a traditional, as opposed to a modern, commercial orchard. I have heard the figure of 50 trees a hectare mentioned. That is a step in the right direction, but most traditional orchards that I have seen come closer to about 50 trees an acre, rather than 50 trees a hectare. Clearly, if we can refine that definition, there is scope for finding a workable yardstick for exemption.
  Fourthly—this applies in the fully commercial world—will the Minister say whether it would be possible to register land for eligibility for payments as and when it reverts to other crops within the normal 30year rotation? There is a perverse situation at the moment in that land would normally be used for other crops after 30 years, but unless people do that before the end of this year, that land will not qualify for single farm payments. That seems not to be the intention. If the Minister could help us with that, he would at a stroke dispel many concerns that might cause the premature destruction of orchards.
  One of the Department's counter-arguments is that orchards will continue to qualify for the countryside stewardship scheme. That would be fine but for the fact that, as the Minister knows, the countryside stewardship scheme is closed to new entrants at the moment. No application can even be considered until 2005. By then, the growers whom I represent will have had to take commercial decisions about what to do with their land. I fear that it will be too late by then, even if the countryside stewardship scheme provides all the support that we hope it would. We need absolutely clarity now, not a wish list for the future.
  Alun Michael: The hon. Gentleman is making an important point. The countryside stewardship scheme is open each year for a window. Although the scheme may change next year, because we are moving into the new arrangements post-CAP reform, there will be a similar window next year. Contrary to the impression that he seems to be giving, if this year's window in the countryside stewardship scheme is missed, it is not over for ever and a day. I can certainly assure him on that point.
  Mr. Heath: I am grateful to the right hon. Gentleman, but that is not what I meant. The point that I am trying to communicate is that there is no capacity to apply for inclusion in the countryside stewardship scheme now, before 1 January 2005. Before that date, a person must have either removed the trees from their land in order to qualify for the single farm payment scheme, or not done so. People are having to take that decision without knowing with certainty whether they will be included in a countryside stewardship scheme. They need clarity.
  The other point raised in correspondence by the Department is that the sums do not add up. The Department says that the cost of grubbing up is £1,000 per hectare, and when that is taken into account, no one will grub up. No one in my part of the world recognises that as a reasonable figure for the cost of grubbing up. The cost would be far less—the Department's figure is hugely inflated. I do not know where the Department found it, but I hope that it is not basing its policy on that
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  figure, because it is unhelpful and reduces the Department's credibility in the eyes of those with whom it is dealing.
  I do not think that the destruction of orchards is the Government's intention. It is an unanticipated consequence of the policy and it can be avoided. The acreage involved is not huge—it is estimated that there are 16,000 acres of orchard, of which perhaps 5,000 acres are in danger of being lost by the end of the year. Saving our orchards is entirely in line with stated Government policy: supposedly the whole point of the reform is to benefit benign forms of cropping and agriculture, which orchards exemplify in the clearest possible way.
  Can anyone imagine this debate happening in any other country? Can anyone imagine traditional and ancient Burgundy vineyards being destroyed and even whole grape varieties lost because no one foresaw the consequences of a policy? Such a thing is unthinkable— yet we in Britain seem to be prepared to lose those things that are most precious and best define our landscape and our culture. I hope that the Minister will find a way to stop that happening.
  8.17 pm
  The Minister for Rural Affairs and Local Environmental Quality (Alun Michael): I congratulate the hon. Member for Somerton and Frome (Mr. Heath) on obtaining this debate and on the way in which he introduced it. His speech contained a subtle mixture of bad and good information, although I entirely accept the lists of names of his constituents and of the distinguished varieties of apple that grow in his constituency. I am happy to confirm that we are anxious to protect biodiversity, which is helped by the existence of traditional orchards. However, in much of the coverage given to the matter, environmental issues have become muddled with questions of subsidy in relation to modern commercial orchards. That is why I am pleased to have had the hon. Gentleman's main concerns confirmed this evening. I understand the reasons for those concerns. A sensible debate is needed, but the public debate has been confused and clarification is needed.
  Some of those who intervened in the debate seemed to suggest that there might be an advantage to growers in other countries—France was specifically mentioned. There will be no benefit in any other member state. Apple trees and others will be treated as permanent crops. In countries that are taking the historic payment route, there will not even be the possibility of acreage that has been used for apple trees qualifying for a flat rate, because there is no flat rate; it is only the flat rate element of the single farm payment that comes into play. In that respect, the concern that has been expressed is quite out of proportion.
  As the hon. Gentleman is aware, the subject falls under the portfolio of my noble Friend Lord Whitty, and I have brought a fresh mind to the issue in my preparations for today's debate. My incredulity has mounted because yet another issue has been reported in various inaccurate ways, as Lord Whitty said this morning. I concur with him, and advise anybody who owns a traditional orchard or is contemplating the purchase of one not to read the headlines about getting

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  an entitlement of £340 a hectare if the rules are changed. That is nonsense—it would take eight years to get more than £200 a hectare, and in the meantime there are better returns on the land and the orchard. Grubbing up to qualify for the area payment would make sense only for commercial or intensive growers—ltheir position is quite different from people with traditional orchards—whose trees have reached the end of their useful life. They would take a commercial decision to grub up anyway, and any gain from area payments would be small compared with the income from a successful apple plantation.
  The hon. Gentleman rightly referred to rotation. A grubbed up commercial orchard would usually be left fallow or put to another use for 15 or 20 years, or perhaps longer, as he suggested, and the grower would plant other land in the meantime. I am happy to assure the hon. Gentleman that we are looking at that issue and are seeking a solution, including the possible use of the national reserve and other options, but that is not the substance of our debate. English Nature has expressed concerns about biodiversity, and we are exploring definitions of, for example, grazing land, which may help to protect it. However, that is different from opening up subsidies for commercial orchards—the issues have become confused.
  Mr. Keetch: Importantly, the Minister distinguished between small growers and commercial growers. As time is short tonight, will he give a commitment that he or his noble Friend Lord Whitty will meet a delegation of small growers from my constituency and from the constituencies of my hon. Friend the Member for Somerton and Frome (Mr. Heath) and other Members in the Chamber tonight, as they would like to present their case directly to Ministers?
  Alun Michael: There has been confusion and misunderstanding, so I am happy to try to clarify the issue with the hon. Gentleman and his hon. Friends, and we can ask others who have more expertise than me to go into the fine detail.
  The underlying themes of our debate were twofold. First, there was a request for subsidies and, secondly, there was concern that perverse incentives could damage biodiversity. I hope that I have shown that the perceived perverse incentive is much less serious than has been suggested. The key feature of the CAP reform settlement is the decoupling of support from production. Existing support for farmers is redirected to encourage them to make the best use of market opportunities. Fruit growing has not benefited from the CAP subsidies that are to be replaced by the single payment. Fruit trees have been planted because there was a market demand for the fruit, not because of subsidies. It is entirely consistent with that philosophy that trees that are no longer needed for commercial production should be grubbed up if there is a more commercial use for the land. In the end, the area used for cider production must reflect the market demand for cider apples and the most commercially appropriate methods of growing them.
  On biodiversity, we must reinforce the point about the lack of incentive to grub up and must counter what has been said. If a grower has been cultivating apples and
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  not claiming on a piece of land, grubbing up will entitle him only to the flat rate element of the single payment, often called the single farm payment. That rate is just over £20 a hectare in the first year, 2005, which is far below both the £340 quoted in the press and media and the £230 area payment, which takes eight years to reach, as the flat rate element in the new payment system builds up through the traditional route. That is without taking into account the cost of grubbing up, and I acknowledge the expenditure mentioned by the hon. Member for Somerton and Frome. The National Farmers Union has put it at about £300 a hectare, although it could be much higher in different circumstances.
  Mr. Heath: I do not want the right hon. Gentleman to mislead himself, as it were, about the perverse incentive. No one in my part of the world believed the incorrect figure that he cited, and they understand perfectly well the rates, the gradual increase and the effective ceiling. What worries them is that that is an important factor in the profitability of their land, and that the capital value of their land is massively reduced if it is not included in the eligibility criteria.
  Alun Michael: A number of complex issues are tied together. One is the possibility of entering into the IACS arrangement—the integrated administration and control scheme—which obtains up to this year. That was inflexible, so there is a change in the arrangements. As I have indicated. there are various other ways in which eligibility can be considered—for example, the issue of trading. There are several complex issues that open a number of doors that are not as closed as has been implied.
  On the key point that the hon. Gentleman made at the start of his contribution, it is important to understand that some orchards—long-established traditional orchards in particular— provide considerable environmental benefits. That is why there is a real incentive to retain them. Those benefits are recognised in the countryside stewardship scheme, which provides payments of about £250 per hectare for maintenance of traditional orchards. That is much higher than the full rate that would be applicable under the new system, and more than the full rate of single payment. Two thirds of the total area of traditional orchards is already protected in this way, through 1,500 agreements, at an annual cost of £600,000. Payment rates for one-off activities such as pruning have been increased by 55 per cent.
  It is open to other growers to come into the stewardship scheme during the annual window. Although the hon. Gentleman is right to say that the window has closed for this year, the window will be there next year, although there will be changes in the scheme, so the opportunity to go into stewardship, which offers much greater rewards than the single payment option, will be available in relation to places where the biodiversity value, which he put at the heart of his comments, is the real issue.
  Andrew George: Does the Minister accept that where the Department is seeking to intervene to put right possible unintended consequences in severely disadvantaged areas—I understand the

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  Department is prepared to do that—notwithstanding country stewardship, there is still the potential for unintended consequences at the end of the transitional period in 2012? Surely the Minister must recognise that he should investigate the possible impact of that and consider revisions to take into account the needs of traditional orchards.
  Alun Michael: I am trying to explain that there can be a perverse incentive—and therefore the grubbing up of orchards—only if those taking such a decision have totally misunderstood the options available to them. I understand the importance of certainty, which the hon. Gentleman is referring to and which the hon. Member for Somerton and Frome mentioned in his speech. It is true that there are CAP reform decisions that are still to be made.
  We cannot realistically expect to reopen the question of permanent crops in the near future. We can, however, take account of the need to protect orchards in planning to implement the single payment scheme. We have been speaking to the National Farmers Union about that. We recognise the need for growers to know what the rules will be, and we will take this into account in the planning announcements—for instance, on the 10-month rule, which determines when land used to support a claim must be at the farmer's disposal. We are also considering the NFU's suggestions about the possible use of the national reserve in certain situations.
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  Finally, we recognise that some old orchards are used for grazing and that this has been taken into account in the existing IACS rules. It would be perverse to create a discrepancy between the current arrangements and the new ones. We are seeking to ensure that the treatment of land under the single payment rules reflects the same considerations.
  We believe that the fears of wholesale orchard grubbing have been exaggerated and would come about only if there was misunderstanding about the options available. We recognise the need for clarity about new rules and are working to resolve the outstanding issues. Countryside stewardship provides an important and successful means of protecting traditional orchards, and we need to consider that as the solution to some of the problems that the hon. Member for Somerton and Frome placed at the heart of his contribution. We should not forget the outstanding achievement that CAP reform represents, moving away from production-related subsidy to production for the market and payment for public good, including biodiversity, the very issue that the hon. Gentleman rightly said was at the heart of the Government's policies, as it was at the heart of his plea in relation to traditional orchards. We recognise, as he does, the contribution that they make to biodiversity.
  Question put and agreed to.
  Adjourned accordingly at half-past Eight o'clock.

Preamble
[MR. EDWARD O'HARA in the Chair]

Anti-Semitism
Motion made, and Question proposed, That the sitting be now adjourned.—[Derek Twigg.]
9.30 am
James Purnell: Before I start, I draw attention to my declaration in the Register of Members' Interests and to my position as the chair of Labour Friends of Israel. I would also like to thank Mr. Speaker for granting this debate because anti-Semitism is an important subject. This is a good time to discuss the issue because anti-Semitism is on the rise and we must combat it as we do all for ms of racism.
Anti-Semitism is not only a growing threat but it has mutated into a new form of race hatred that has found cover in extreme and unreasonable anti-Zionism. We must not forget the lessons of the past that anti-Semitism must be fought when it starts and must never be allowed to become a force that cannot be put back in its bottle. It is not for the Jewish community to solve the problem but for the rest of us to solve it for them. They suffer from the problem, but we must solve it.
What is anti-Semitism? It is the hatred, fear, targeting or attack of people simply because they are Jewish, and it is increasing. Last year there were 375 anti-Semitic attacks in Britain—the second highest total since the figures were first collected and a 7 per cent. increase on the 2002 figure.
Examples speak louder than statistics. Last year, a rabbi in Birmingham was spat at and attacked while walking home from Friday night prayers. Bricks were thrown through windows of the Edgware synagogue. Synagogues across the country were daubed with swastikas and graffiti, and there were arson attacks on synagogues in Finsbury Park and Manchester. Five hundred gravestones in Plashet cemetery were defaced causing £1 million worth of damage—the largest ever attack on a Jewish cemetery in Britain. Perhaps most chilling of all was that Britain produced its first suicide bomber, someone educated in this country who used his passport to enter Israel and blow himself up in a beachfront bar. It is chilling not only that this country produced him. Because of the lack of moral outrage and soul searching in this country, the event did not convulse our moral conscience as it should have done.
The picture outside Britain was even more chilling. Over the past year, for example, the Malaysian Prime Minister in his outgoing speech called for the targeting of Jews worldwide. In November, a terrorist attack on two Istanbul synagogues—Oasis of Peace and Beit Israel—killed 25 people and injured more than 300. An arson attack on the same day destroyed a Jewish school near Paris in France. Those attacks were preceded by deadly terrorist truck bombs on synagogues and Jewish community centres in Casablanca and Tunisia. Just two weeks ago, police in Hungary discovered and foiled an attempt to bomb Hungary's new holocaust museum
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during the visit of the Israeli President. The trend is serious and growing, with al-Qaeda attacking Jewish centres every six months or so. It is a terrible and incredible fact that anti-Semitism is on the rise once again, 60 years after the holocaust.
For 60 years the memory of the holocaust largely inoculated Europe against anti-Semitism. Of course, like all forms of racism, such as Islamophobia, anti-Semitism continued to exist—there are bigots everywhere. However, civilised people learned the lessons of the holocaust and overt anti-Semitism in public debate became taboo. Most people learned the lessons that anti-Semitism starts with talk of cabals and conspiracies and with the demonisation of Jews and that that demonisation can lead all too quickly to persecution. We need to reflect on those lessons.
Anti-Semitism is perhaps the oldest form of racism. For centuries, it has existed deep in the European psyche, in our literature and songs and in our popular culture. As Chief Rabbi Jonathan Sacks has said, the Jewish community could never win: it was attacked whatever it did. Jewish people were attacked because they were rich and because they were indigent. They were attacked because they were capitalists, but also because they were communists. They were attacked because they lived apart, but also because they were everywhere in our society. They were attacked because they were religious fanatics, but also because they were thought to epitomise the moral degenerate.
Linda Perham: Does my hon. Friend agree that it is important to support the work of FAIR—Fairness and Accuracy in Reporting—Palestinian Media Watch and other organisations that keep an eye on the amount of anti-Semitic literature in the media in this country and elsewhere to ensure that we are ever vigilant about such attacks on Jewish people?
James Purnell: I agree. It is of course important that we have a vibrant debate about the middle east, but we need to be very careful that the debate does not turn into racist attacks on any side and, in particular, incitement to violence against Jewish people.
As the Chief Rabbi says, the Jewish community could not win: it was a target whatever it did. Over the centuries, that widespread hatred occasionally erupted into violence, frequently erupted into persecution and, in tragic times, developed into pogroms—that very Jewish word for a very Jewish form of suffering. The holocaust was the final evolution of that anti-Semitism, and it was so inhuman that anti-Semitism virtually disappeared from civilised debate for the rest of the 20th century.
Today, overt anti-Semitism is still taboo, but it is a virus and it has once again started to infect our body politic. The virus is spread by age-old caricatures. It is spread, for example, by television pictures and graphics of spider webs of prominent Jewish people. Those images represent a perceived Jewish lobby with malign and excessive influence. The influence and even the very existence of that lobby is often only imagined in that people who are thought to be Jewish are not Jewish.
Mr. John Randall: The hon. Gentleman has said that anti-Semitism is taboo in civilised debate, but it can occur in civilised debate. I seem

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to remember that one hon. Member said not so long ago that the Prime Minister was being influenced by a cabal of Jewish advisers. That is exactly the type of thing to which the hon. Gentleman is referring.
James Purnell: I have no desire to get into discussions about individuals. I am saying that people use such images without anti-Semitic motives and without feeling themselves to be anti-Semitic. Indeed, they would be horrified if they were accused of being anti-Semitic, but the images perpetuate and spread anti-Semitic ideas, and people have forgotten the power of those images.
Mr. Randall: My point is that, somehow or other, we are forgetting something. People may talk about a cabal of Jewish advisers, but we would be appalled if someone spoke about a cabal, for example, of black advisers.
James Purnell: Indeed, I echo the point that the hon. Gentleman makes. The danger of that conversation is that people get into discussion of good Jews and bad Jews. Frankly, anyone, whatever their racial or religious background, should be allowed to work for any politician, and there should be no discussion of their views based on those grounds. We should discuss only the merits of their views.
Lembit Öpik: I am involved with the Holocaust Educational Trust and it strikes me that the issue is that people mix up criticism of, for example, Israeli Government policy with justification for criticising an entire faith. Does the hon. Gentleman agree that it is no more acceptable to justify one's anti-Semitism on the basis of criticism of Israeli Government policy—for example, towards Palestinians—than it would be to criticise British Government policy on Iraq on the basis of the Prime Minister's religious faith?
James Purnell: I entirely agree. It would be completely outrageous to say that the American Government had pledged money to eradicating AIDS because people of African-American origin were highly placed in the American Administration. In the same way, it would be completely outrageous to try to assign particular policies to the ethnic or religious background of people in particular Administrations.
I gave one example of how the virus is spread. Other examples are the cartoon of the star of David piercing the Union jack under the headline, "Kosher conspiracy," and pictures of Prime Minister Sharon biting the heads off babies. We need to remind ourselves why those images are so dangerous. The idea of the foreign, unpatriotic and controlling Jew is deep within our culture. It is reminiscent, most obviously, of the forged KGB document—the protocols of the elders of Zion. That is one example of the permanent theme of the Jewish community having an effect beyond the justice of its arguments, and it is a way of undermining the justice of those arguments.
Mrs. Louise Ellman: Does my hon. Friend agree that the perception of the all-powerful Jew is as fallacious as it is pernicious? Criticising Israeli policy is not anti-Semitic in itself, but
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does he agree that too many critics of Israeli policy invoke images of all-powerful Jews when, in fact, the Jewish population of this country is about half a per cent. of the population, and in the United States is about 2 per cent. of the population? Does he also recall that the Hamas charter supports the protocols of the elders of Zion and talks about world wide Jewish conspiracies to control and corrupt the world?
James Purnell: I entirely agree. My hon. Friend makes a very important point about the Hamas constitution, which illustrates a continuum of which we should all be very aware: what is well known elsewhere to be a forgery is believed to be an authentic document and is treated as such. Another example is the film that is sometimes shown of someone trying to represent Prime Minister Sharon. This film tries to perpetuate the blood libel against the Jews and is an incredibly dangerous image.
People in America often refer to the strength of the Jewish lobby. It is worth remembering that American Governments are so strongly pro-Israel because the American population is very strongly pro-Israel. There is a very strong commitment among American voters to the continued existence of the state of Israel, and revulsion for what happened during the holocaust. Their support for America's support for Israel is fairly unshakeable. People in this country often forget that and it is rarely mentioned.
It is very important to remember why those images are dangerous. When I visited Yad Vashem—the holocaust museum in Jerusalem—I was struck by the resemblance of some of the modern images, examples of which I quoted, to some of the Nazi imagery that appeared in Nazi publications in the 1930s.I do not believe that these modern images had anti-Semitic motives or were produced by people who were anti-Semitic. My worry is that members of my generation are forgetting the lessons that we learned in the 20th century that those images spread a virus of anti-Semitism and echo themes that are deep in our culture. My generation did not live through the second world war and its aftermath and it did not learn those lessons in a way that we have not forgotten. In fact, we never learned them in the first place. We need to learn those lessons again, because in my view the struggle will now come to the fore and we all need to play our part in winning it.
Mrs. Gillian Shephard: I congratulate the hon. Gentleman on securing this debate, and I regret that I cannot remain for the whole of it. As chairman of Conservative Friends of Israel, I very much support him.
The hon. Gentleman mentions learning lessons, but has he looked at the way in which the French Government have chosen to deal with the greater number of outbreaks of anti-Semitic attacks in France? We could perhaps draw lessons from that. There have been more attacks, some of which have been more violent, and there have been attacks in the entertainment industry as well as physical attacks on Jewish subjects. However, the President of France, backed by his whole Cabinet and the Chief Rabbi, has led an enormous number of initiatives in the French media rejecting anti-Semitism. Those initiatives are repeated, repeated and repeated. We do

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not take the same approach, and I wonder whether that is because of political correctness. Does the hon. Gentleman have a view?
James Purnell: I applaud what President Chirac did. I think that the problem in France is slightly different; the number of attacks has been greater and more serious. I know from speaking to Jewish friends of mine in France that members of the Jewish community feel uncomfortable about remaining in France. The French political world has also slightly swept the problem under the carpet for a long time and, because of the French commitment to equal citizenship under the republic, there has been a general reluctance, compared to Britain, to talk about religious or racial differences. Parties of all colours in this country have been addressing the issue for a long time.
The reaction in France is commendable, but it is a reaction to a particular, very serious, problem in France. What has been done in this country—holocaust memorial day and the Holocaust Educational Trust are clear examples—shows that the issue has been dealt with at a political level over a longer period. However, I would be happy for the Government to come forward with any further initiatives. I am not arguing for any particular policy initiatives today. I merely want to raise the issue and to say to all opinion leaders that it is our responsibility to show leadership on it.
Mrs. Shephard: I absolutely accept the hon. Gentleman's argument that the position in France, and in each country in the world where anti-Semitism exists, is different. In France, that is partly because of quite recent historical events. However. it is interesting to note the even-handed treatment by the written press of the middle east question and the removal from their arguments of anti-Semitic approaches. I wonder whether that is because of the extremely strong line taken by the French Government in recent months. Perhaps, like me, the hon. Gentleman will hope to hear the Minister's response and her view of the French Government's approach.
James Purnell: I am, of course, looking forward to hearing from the Minister. I would also be delighted to swap the French written press, in some ways, for the English written press. If the right hon. Lady has any suggestions for a way in which we might achieve that, I would also be all ears, as would many of our colleagues.
Had I heard myself making this argument two years ago, before I became the chair of Labour Friends of Israel, I might have dismissed it as paranoid. I might have thought that it was special pleading. However, my experience as the chair of Labour Friends of Israel has brought home to me the way that the Jewish community feels about the attacks and their existence. I could quote a large number of examples, but I want to refer to one in particular.
I made some comments recently in t he press following the comments made by the hon. Member for Richmond Park (Dr. Tonge). I received a tenet from someone who had been a member of the Labour party in my area. She said that she had not known that I was Jewish and that had she known that I was Jewish, she would not have voted for me in the selection battle. She thought that it was completely outrageous that I had not made my
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ethnic background clear. After some horrible paragraphs, the letter finished with a large, underlined postscript saying, "Are you Jewish?" I ignored that and replied to her, but she wrote back, with the postscript again asking, "Are you Jewish?" The third letter said that, because I was refusing to answer her question, she would now vote for the Conservative party at the next election. I am sure that my Conservative opponent would be happy to reject her vote, as would a candidate from any party in this House. I was deeply shocked to find that attitude in my constituency and in the Labour party, and the extraordinary thing is that it is something that members of the Jewish community encounter on a regular basis.
I am also shocked to find that when I say that I am chair of Labour Friends of Israel, many people say, "Well, I'm not a friend of Israel". We have to ask ourselves how many other countries one would say that about. To how many other democracies would someone have such a visceral reaction? It illustrates an important point. Like any strong virus, anti-Semitism has survived by adapting to its circumstances and mutating. Modern anti-Semitism is no longer an overt hatred of Jews—people know that that is taboo and that they cannot get away with it. Instead, as has been said, modern anti-Semitism has found a home in overt, extreme and unreasonable attacks on Israel and in extreme anti-Zionism.
Mr. Richard Spring: I pay tribute to the hon. Gentleman for securing this debate. It is welcome and timely. To echo the point of my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard), I refer to once hearing Bishop Trevor Huddleston say that he gave thanks to God for the Jewish community in our country. What he meant is that although the Jewish community is a small one, its contribution to our national life has been stupendous, whether it has been in this place or each field of scientific, medical or judicial activity. It is incumbent on us to say that occasionally, because it is true. The Jewish community is a special part of the whole community in the United Kingdom.
James Purnell: I echo what the hon. Gentleman said, and I am sure that all hon. Members would do the same. It is appropriate that he said it.
I must say that I have been stunned by the viciousness of some of the attacks on Israel in debates on the middle east and by the unbalanced tenor of many of those debates. Most blatant is the analogy that is increasingly made between what is happening in Israel and what happened in Nazi Germany. That analogy has gained ground in some left-wing circles, particularly among certain academics. I find it unbelievable to hear people saying that the Israeli army is the Zionist SS, to read about Jewish academics being thrown off editorial boards or refused interviews for jobs purely because they are Jewish and for those decisions to be justified by an attack on Israel by people saying, for example:
"Israel has gone beyond just war crimes…many of us would like to talk about it as some kind of Holocaust".
We have to pause, listen to those words and think about the analogy that is being made between what happened in Nazi Germany, with the murder of millions of people and the deliberate and planned attempt to exterminate a whole race, and what is happening in the

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middle east. There is suffering on both sides in the middle east, and to compare in any way what happened in Nazi Germany to what is happening there defies belief. One has to question the motives of the people who do it.
Mr. Randall: Does the hon. Gentleman agree that one problem is that the words "holocaust" and "genocide" have become undervalued as they have been used too often, perhaps sensationally, to describe various incidents around the world? We tend to forget what actually happened during the years of the Nazi holocaust.
James Purnell: That is a very good point and one that I had not thought about. I am grateful to the hon. Gentleman for making it. It is also worth saying that the comparisons between Nazi Germany and today's situation are simply wrong. The novelist Howard Jacobson put it very well when he wrote:
"Examine what is meant by 'reminiscent of the Nazis' and you find no extermination camps, no master-race eugenics programmes, no extirpation of an entire culture, no final solution".
Some on the extreme left have allowed themselves to pick up some strange bedfellows in their vitriolic criticisms of Israel. There were some terrifying pictures of individuals at the anti-war protests who were dressed up as suicide bombers, holding banners with the star of David, an equals sign and a swastika. The apparent embrace of such symbols by the anti-war left is astounding. Jewish friends who went on anti-war marches told me that they were shocked to the core to see some of the symbols and to hear some of the chants.
We must understand what such comparisons do. They seek to undermine the moral force of the argument for a Jewish state. They seek to say that what the Nazis did to the Jews, the Israelis are now doing to the Palestinians. They seek to say that Israel and the Jewish people do not deserve their own state. They then somehow lead on to the idea that it is acceptable to kill innocent Israeli civilians, that that can be explained, that we can blunt our moral outrage at suicide terror and that it has become a legitimate tool of political debate.
Ned Temko, the editor of the Jewish Chronicle, put it very well when he said that when there is a suicide terror attack against whatever nationality, whether it is Muslim or Jew, there can be no buts: suicide terror has to be condemned. There can be no buts. There can be no following sentence in which we say that of course we condemn this act of suicide terror, but that "xyz" has to be understood.
Mrs. Ellman: In view of the very important observations that my hon. Friend has just made, does he think that the time has come for those involved in the anti-war coalition to dissociate themselves from the supporters of Hamas and the Muslim Association of Britain?
James Purnell: That time came a while ago. I certainly agree that now would be a good time for that to happen. Although it is true for all parties, this is a point on which the left needs to search its conscience. We pride ourselves on standing up against intolerance, ignorance, prejudice
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and racism, but some on the extreme left are now fostering precisely those terrible instincts. They have to ask themselves who they are sharing platforms with and whether they are crossing the line from valid criticism to distorted prejudice. I believe that that violent anti-Zionism is anti-Semitism.
We need to be careful about this. We should never allow ourselves to be accused of using anti-Semitism to prevent debate about the middle east. It is perfectly fair to disagree with policies of an individual Israeli Government. It becomes illegitimate when it turns into criticism of Israel itself and a denial of Israel's right to exist. One can disagree with Israeli Governments without being anti-Semitic. I find it hard to see how one can be anti-Zionist without being anti-Semitic. We all argue passionately for the rights of people around the world to self-determination. Why should we single out Israel as being the one country that is not allowed to have self-determination and, particularly in the light of the holocaust, why should we deny its people the right to live secure within its borders?
Richard Burden: I agree with a great deal of what my hon. Friend says about the scourge of anti-Semitism. If I manage to catch your eye, Mr. Deputy Speaker, I will say a little more about that. I am worried by his comment that anti-Zionism must therefore be anti-Semitism. I take the view that Israel has the right to exist and that there should be two states. However, there is Jewish opinion that disagrees with a state of Israel. Presumably that kind of anti-Zionism is not anti-Semitism.
James Purnell: I use the term Zionism in a specific sense—Israel's right to its own state if it wants that. I believe that, following the holocaust and the example of the 20th century, the case for that is incontrovertible. I worry whenever anyone denies that. I heard a national magazine editor saying in private the other day that we had made a mistake by creating the state of Israel. Such arguments worry me.
A recent collection on this matter contains a very good piece by Jonathan Freedland, which goes through all the arguments. I found it very persuasive. It is hard to see why we should have supported South Africans' right to self-determination and to run their own country, and supported those rights elsewhere in the world, but not have given the same support to Jewish people in Israel.
Anti-Semitism is not a problem that the Jewish community can solve. It is a problem that it suffers and one that the rest of us should solve. Of course anti-Semitism has not yet reached the level that it reached in the 1930s. However, that is precisely why it is up to us to deal with it today. If we can deal with it at the beginning, it will not be able to get out of the bottle and become as deadly as it did in the previous century.
I ask only one thing of today's debate. As I have said, I do not have any particular policy prescriptions or desires. I wanted only to raise a flag against the renewed menace of anti-Semitism, to pledge that we shall do all that we can to prevent anti-Semitism from scarring our society today and to ask for moderation and balance in debates about the middle east. I shudder when people get cheers for attacking the state of Israel. I hate it when people talk as if Israel brings suicide terror on itself by its policies. I hate

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it when people ignore the hundreds of people from that small country who have been killed in this terrible conflict.
Of course there is suffering on both sides. Of course the Palestinians' plight is terrible. Everyone should recognise that. However, it is incumbent on all of us who take part in these debates to try to ensure that we do not exacerbate the differences of the middle east; we should instead do all that we can to bring both sides together, argue for moderation and present a balanced picture of the debate in the middle east. In this of all places we can secure a balanced debate and stand up against anti-Semitism. As opinion formers and leaders we have that opportunity and we should take it.
Several hon. Members rose—
Mr. Deputy Speaker (Mr. Edward O'Hara): Order. I remind right hon. and hon. Members that the winding-up speeches must start not later than 10.30.
10.3 am
Mr. Stephen Byers: I congratulate my hon. Friend the Member for Stalybridge and Hyde (James Purnell) on securing this timely debate on anti-Semitism. As he said, he chairs Labour Friends of Israel and he has been highly effective in that capacity. The fact that he has secured the debate shows how he pursues the issues on behalf of not only that group in the House, but the Jewish community in the United Kingdom.
I am keen to take part in this morning's debate in my capacity as chair of the parliamentary committee against anti-Semitism. I was approached last autumn about whether I was prepared to take on that role. I gave it some thought and looked into the present situation. Rather like my hon. Friend, I was unaware of the particular problems being experienced and of the increase in anti-Semitic attacks occurring in the United Kingdom. However, once I had looked into the matter, I had no doubt that it needed to be addressed as a priority. That is why I agreed to chair the parliamentary committee against anti-Semitism, which represents all parties in this House and in the other place.
I want to make only a few brief comments so as to enable hon. Friends whom I know want to take part in the debate to make their contributions. At the beginning of such a debate, it is important to stress that all forms of hatred and discrimination must be confronted and challenged. Although we are debating anti-Semitism, that does not mean that it is the only form of prejudice that exists in our society. Islamophobia is increasing. I know many good, decent Muslims who feel tainted by the views of a minority of radical, fanatical fundamentalists and are concerned about how the debate is developing. Hindus and Sikhs find that there is a continued lack of understanding of their beliefs and religion. Discrimination on the ground of colour still exists and must be confronted. It is worth putting the debate in that context.
It is important to debate anti-Semitism today because verbal and physical attacks are increasing and because of the development of an intellectual argument in favour of anti-Semitism. I shall focus most of my remarks on that latter aspect. I shall comment first, however, on
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visits that I made recently as chairman of the parliamentary committee to Bury and Manchester in the north-west and to Leeds in Yorkshire. The purpose of those visits was to talk to leaders of the Jewish community, schoolchildren with a range of beliefs and university students to find out their views on what is happening in their communities and areas.
Interestingly, there was a real sense of cohesion in the Jewish community in those parts of the UK. The community is strong and it takes great pride in the role that it has played over the years in developing civic life in those areas. The community has also played a very important part in the cultural life, the academic community and the business world of those areas.
Despite its strength, the community also has real concerns. One person said to me, "Things were really bad during the 1970s, but they are a lot worse now." A sixth-former—a bright, able young girl—said to me that she is unsure about going to university because she is worried about the safety and security of the environment into which she would be moving. A 15-year-old—a little lad with glasses—said that bullying and verbal abuse are parts of his daily experience that he almost takes for granted. The bullying and name-calling occur not because he is not a strong-looking individual, but because he is Jewish. It is not acceptable to me that someone in the UK at the beginning of the 21st century has to be brought up in such an environment. We must say to people in those communities that we in Parliament understand their concerns and recognise that those attacks are increasing.
My main concern, however, is not that anti-Semitism is resurgent, but that in some circles it is becoming respectable. It is being portrayed almost as anti-Semitism with a social conscience, because it is based on support for human rights and on concern for the Palestinian people.
I want to make it clear that criticising the Government of Israel is not anti-Semitic. Some of the strongest criticisms that I have heard of Prime Minister Sharon have been made by Jews, but there is a danger that the legitimate criticism that can be made of any Government could be misused against the Government of Israel. It should not be used as a cloak of respectability for anti-Semitic views. All too often, the line between making legitimate criticism and comment and demonising and dehumanising Jews is being crossed, and double standards are being applied. That is dangerous territory, because some intellectual commentators are demanding that Jews denounce the Israeli Government's actions and policies to earn a commitment to fight with them against anti-Semitism. That is unacceptable.
I repeat that criticism of the Government of Israel and their policies is not anti-Semitic, but it can become so when it involves the application of double standards, holding all Jews responsible for the Israeli Government's actions, or demonising Jews. Clearly, it is anti-Semitic if it provides an excuse for anti-Jewish hatred.
No one should be asked to take a loyalty or morality oath as a precondition of protection against racism, but that is what some people ask Jews to do. No citizen in this country should feel that their equality before the law depends on their embrace of political views that we

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happen to approve of. That is totalitarian logic that undermines the very freedoms that form the basis of our society and our country, yet it is what modern-day anti-Semites are demanding.
Anti-Semitic acts are being justified by commentators who accuse Jews of being the cause of their own suffering. That logic borders on an apology for hatred. Worse, it is a thinly veiled threat that if Jews fail to oblige, people will not stand by them in their hour of need. Instead of sympathising with victims, anti-Semites exploit the Palestinian cause to side with the people responsible for terrible acts of terrorism. Around the world, it is only Jews, and Israel, that earn that particular treatment.
We need to be robust in confronting anti-Semitic views wherever they occur. Anti-Semitism is not rational. The Chief Rabbi, Jonathan Sacks, said that it is a virus that mutates. It will not be defeated unless it is treated as an act of senseless hatred that has no logic, reason or justification and which is based on myths and prejudice. That is the basis on which it should be tackled, but we must ask ourselves why that age-old hatred is resurging now. It is because people with anti-Semitic views feel strengthened.
The prejudice of those people—suppressed out of guilt for over 50 years—is coming forward and finding its way back into the mainstream of political thinking and comment in civilised circles. When we see that happening, or hear or read such comments, we all have a responsibility not to accept it in a spirit of tolerance. It would often be the British way of dealing with such things to say, "Well, that is a fair view which is being expressed," but it is not a fair view. It is prejudice, and it needs to be confronted as such.
The debate gives us all a timely opportunity to recognise that we must be eternally vigilant. It also provides this mother of Parliaments with the opportunity to reaffirm its commitment to exposing, confronting and fighting anti-Semitism in whatever form it may take and from whatever quarter it may come. Of course, we do this for the Jewish population in the United Kingdom, but also to defend the principles and values on which our country is based.
10.15 am
Linda Perham: I congratulate my hon. Friend the Member for Stalybridge and Hyde (James Purnell) on securing the debate. It was a privilege to visit Israel in July as part of the Labour Friends of Israel delegation, which he led.
My previous visit to Israel was in 1998, when the outlook on our return was pessimistic; that was before the intifada in September 2000, after which the number of anti-Semitic attacks in this country and elsewhere increased. I speak as secretary of the British Israel Group, a vice-chair of Labour Friends of Israel and as Member of Parliament for a London borough that contains 15,000 Jews. That community is deeply worried by the rise of anti-Semitism in the form of physical attacks and in the media; they are concerned about prejudice in television accounts of the middle east. My constituents constantly raise the issue of anti-Semitism at my surgeries and at events and gatherings that I
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attend, such as the Jewish Association of Cultural Societies. I am going to one such event on Thursday, when I am sure that the issue will again be raised.
I also take part in question-and-answer sessions at the local Jewish centre, Sinclair house, which is based in my constituency. It is a thriving centre, which is very well attended. It was my privilege to accompany people from that centre and Jewish friends from the constituency to the rally for Israel in May 2002 in Trafalgar square. Thousands of people were present, including a handful of MPs, and there were signs saying, "Israel we support you". Unfortunately, on the other side of the road, there was a counter-demonstration of a few hundred people carrying signs saying things such as "Kill the Jews". Lord Greville Janner, who spoke at the rally, said, "We don't have signs saying 'Kill the Muslims' or 'Kill the Arabs', but they have signs saying 'Kill the Jews'". I took that point to heart.
In September, I accompanied Lord Janner and Lord Parry Mitchell on a visit to the opening of a Jewish school in the former Soviet republic of Azerbaijan, which is a 93 per cent. Muslim country. However, we found a great tolerance of all religions. We also visited the Qaba region further from the capital where the synagogue and the mosque were next to each other and where the rural community tolerated different religions. I hope we can foster that sense of peaceful co-existence and tolerance in this country by confronting anti-Semitism wherever it raises its head.
I agree with my hon. Friends that this debate is timely; anti-Semitism, which causes deep anxiety in my constituency, is something that hon. Members must challenge.
10.19 am
Mr. Andrew Dismore: I represent Hendon, which has one of the biggest Jewish communities in Britain. I am also a vice-chair of the Labour Friends of Israel and one of the officers of the body about which my right hon. Friend the Member for Tyneside, North (Mr. Byers) spoke.
In the short time available, I want to focus on some of the anti-Semitic activities of fundamentalist organisations. Rather than describe them all, I shall concentrate on the activities of al-Muhajiroun and its leader, Omar Bakri Mohammed, and its sister organisation Hizb ut-Tahrir. I first took an interest in their activities five or six years ago, but particularly after I witnessed an anti-Semitic demonstration that they had organised outside Brent town hall in May 2000. They were picketing a celebration of Israel's independence day, and their chants included "Dirty Jews we want your blood", "All Jews burn in hell", "The Muslim will fight the Jew—we will kill the Jew" and so on. Two demonstrators were arrested but released without charge.
However, al-Muhajiroun has a much longer history of anti-Semitism. In June 1998, one of the group's activists, Avais Khan, told a rally in Trafalgar square that
"the Holocaust was a fabrication. How wicked, how evil the Jews are. They don't even deserve the death of the dog."
In September 2000, the group produced a leaflet referring to "Jewish Murderers". At a demonstration in January 2000, its members chanted "Gas the Jews". In May 2000, the group issued a leaflet stating:

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"O Jew, hide in your bunkers, because the Mujahideen are coming so be ready to surrender or die like a dog."
The group's leader is Omar Bakri Mohammed. In October 2000, he said that Jews who actively supported Israel did so at their peril:
"If they are going to raise funds for Israel, they are going to put themselves in the conflict and become legitimate targets for Muslims wherever they are".
On 13 October 2000, al-Muhajiroun put out a leaflet saying:
"The hour will not come until the Muslims fight the Jews and the Muslims kill them".
On 20 October, in Derby, the group organised a demonstration with leaflets saying "Kill the Jews". So it goes on. There are many examples of the group's anti-Semitic activity. Has any al-Muhajiroun leader or activist been prosecuted? Absolutely not. I regard that as a pusillanimous response from our forces of law and order. How can the organisation continue to promulgate its message of hatred against the Jewish community with such impunity?
After 11 September, things got even worse, and the group started issuing statements praising the attackers. Soon after 11 September, Omar Bakri was quoted as saying:
"When I first heard about it, there was…delight about such an attack."
On the very night of 11 September, posters were put up urging Muslims to kill the Jews; Omar Bakri's mobile phone number was at the bottom The year after, the group organised a demonstration in Trafalgar square—the so-called magnificent 17 demonstration—to praise the suicide bombers. The London Mayor, Ken Livingstone, banned the demonstration. He was the only person who was prepared to take any action against the group, but it took no notice and held the demonstration anyway. Anjem Chaudhary and, I think, one or two others who were responsible for organising the demonstration were prosecuted but let off with a very minor penalty.
Other hon. Members have referred to al-Muhajiroun's activities on university campuses. For years, the group and its sister movement, Hizb ut-Tahrir, have contributed to a climate of fear for Jewish students and other minorities on British campuses. In October 2000, a poster appeared on campuses throughout Britain stating:
"The last hour will not come until the Muslims fight the Jews and the Muslims kill the Jews."
I am pleased to say that, after that, the National Union of Students took action to ban al-Muhajiroun from student unions for distributing anti-Semitic material. That is an important step, but the group nevertheless continues to organise around universities and, I regret to say, some sixth-form colleges.
There are many more examples of what al-Muhajiroun has been up to, but I shall mention just two. In January 2003, I was debating on television with Omar Bakri Mohammed. He told the audience that I said what I did only because I was Jewish and therefore "biased by default". I have no hesitation in saying that I am not Jewish, unlike my hon. Friend the Member for Stalybridge and Hyde (James Purnell). None the less, those comments demonstrate the extent of the anti-Semitic behaviour of al-Muhajiroun and Omar Bakri
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Mohammed, who automatically assume that anybody who criticises them must be Jewish and, no doubt, that everybody would otherwise agree with them.
Omar Bakri Mohammed is undoubtedly a controversial figure. In April 2003, he was under attack for receiving state benefits. He said:
"Ask the Muslim people where they would prefer their taxes to be spent—on me, or homosexuals, lesbians or Jews".
Again, that reveals his anti-Semitic behaviour.
There is a more sinister side to the organisation. Omar Bakri Mohammed is not the buffoon that some people believe him to be. He comes from a wealthy background in Syria. He was a Hizb ut-Tahrir activist in Damascus who fled to Beirut and then to Saudi Arabia, where he was wanted for illegal Hizb ut-Tahrir activity. He fled to the United Kingdom in 1985 and, in 1991, he called for John Major, the then Prime Minister, to be assassinated. Despite that, he was given indefinite leave to remain in 1993. Ten years later, the threat was repeated. In 2001, al-Muhajiroun activist Abdul Rehmon Saleem called for the assassination of Prime Minister Blair. The organisation actively supports terrorism, and it is about time that we dealt with it.
In the London-based Arabic newspaper Al-Sharq al-Awsat, on 30 May 2000, Mohammed boasted of the extent to which young British Muslims were being recruited for military training overseas. They were sent to fight in the trouble spots of the world but only, he said, when they were fully trained—not just militarily but ideologically. On the BBC Radio 4 "Today" programme in June 2000, Abu Yaya, who turned out to be a mujaheddin activist, talked about the weapons training that he had had overseas. He had learned to use a Kalashnikov, to ambush, to make bombs and even to use artillery.
It was not just idle boasting. The Mike's bar bombers in Israel in 2003—two Britons, Asif Muhammed Hanif and Omar Khan Sharif—were associates of Omar Bakri. He openly claimed on the BBC that the two men had come to him for instruction, and in The Daily Telegraph, he stated that Sharif was a martyr, who had died in the cause of Muslim lands and Muslim people. He said,
"I knew Sharif very well and he used to attend regularly at my sessions. He was my brother and I am very proud of him and any Muslim who will do the same."
It goes on. Hassan Butt, another al-Muhajiroun activist, said in May 2003 that "close to 50" British volunteers had approached him for advice on emulating the suicide attack in Israel. Asked whether that meant suicide missions in Britain, he replied,
"Yes, absolutely. When they're needed and when they're required…if they want to and they believe Islamically that it's allowed, then fair enough."
He went on to say that
"it would not surprise me if a suicide bomb did take place in Britain. It would not surprise me at all."
Those are very forward-looking quotes, bearing in mind last night's arrests in Manchester of people who, I have little doubt, will be tracked back to al-Muhajiroun, Omar Bakri Mohammed and supporters of sharia and Abu Hamza. They show clearly how young British Muslim society has been affected and why action has to be taken. The organisation's boast is that its objective is to see the black flag of Islam flying over Downing street, a claim that is repeated time and again.

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We have powers under section 76 of the Nationality, Immigration and Asylum Act 2002 to remove Omar Bakri Mohammed's indefinite leave to remain. I urge the Home Secretary to use them, so that Mohammed can be removed from our society. The time has undoubtedly come for al-Muhajiroun to be proscribed under the terrorism legislation as an active organisation promoting and supporting terrorism, not just overseas but in the United Kingdom.
Several hon. Members rose—
Mr. Deputy Speaker: Order. Because of Back Benchers' great interest in the debate, it has been agreed that the winding-up speeches will start at not later than 10.40 am. I am sure that hon. Members will co-operate.
10.29 am
John Mann: My preparation for the debate began yesterday morning when I received an unsolicited letter from a constituent, who enclosed printed copy about the "Jewish-controlled media" and the "Jewish media spin doctors" and wrote that the Prime Minister is in the pocket of Jewry. It is worthy of the attention of the Chamber because it is clear that the individual who sent it would claim to be on the left. I shall restrict my comments to the issue of anti-Semitism on the left, which does not receive enough attention.
I thought that my hon. Friend the Member for Stalybridge and Hyde (James Purnell) was rather too gentle in his comments on those who are prepared to talk about cabals of Jewish advisers to the Prime Minister. I recall that Senator Jesse Helms's campaign during the North Carolina senate elections of 1984 was entirely based on a poster with a picture of his Democrat opponent surrounded by black faces and the words "Know him by his friends".
Such insidious racism is not new, even in my political generation. In the early 1980s, anyone in the student movement in this country who had the temerity to say that Israel had the right to exist would be isolated and howled down as a racist. That was a time when Jewish societies were repeatedly banned in student unions across the country. My recollection of those days is vivid. Comrades and colleagues on the left were happy to tell me that they would not be prepared in any circumstances to support me in an election just because I was prepared to articulate a two-state solution to the problem in the middle east. They were categorical about that, but polite on all other matters. That was not a minority interest, but a significant factor among people on the left, who were and are important political players. The subterfuge that such people used was Zionism. They seemed to think that quoting the term "Zionism" made everything okay and meant that they were attacking not Jewish people, but Zionists and the concept of Zionism, but that was a subterfuge.
That is not to say, however, that the people whose arguments and beliefs were virulently anti-Zionist were racist or anti-Semitic, because some were not. Their arguments were well thought out and they understood the differences. Equally, however, other people's arguments were not thought out, and they were happy
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to lump things together. Such people used the subterfuge of anti-Zionism to act and think in a way that was anti-Semitic, hence letters such as the one that I mentioned. Such people have employed a straightforward concept: that there are conspiracies—smaller conspiracies, not a world conspiracy—involving a group that has managed to infiltrate the higher echelons of power in the United States, Britain and other countries and is thereby exercising an undue influence. That is the basic tenet of such individuals' beliefs, which caricature an entire people.
It is of course nonsense to suggest that the rather communistic early kibbutzniks were ideologically close to some of the more extreme right-wing settler groups of the last 30 or 40 3ears. One would not suggest, for instance, that Christianity was an amorphous mass that could be criticised as one. It would clearly be nonsense to say that Billy Graham and the Southern Baptist Christian evangelicals—some of whom are, in my experience, rather anti-Semitic—are exactly the same as Archbishop Desmond Tutu, Dom Helder Camara or the left-wing Christian ideologues. The vitriol contained in attacks on the term "Zionism" masks a much deeper underlying anti-Semitism that exists in the minds of some people.
I am not a great supporter of the actions of the state of Israel. I have visited the country, but I have also visited the west bank with the Palestinian Liberation Organisation. I therefore take a neutral stance on the matter, and few voters in my constituency are anything other than lumpen Anglo-Saxons. No votes are at stake in relation to anything that I may say on the subject. However, the concept of self-determination cannot be divided. The fact is that the self-determination of a people will lead to conflict; and the word for such conflicts is politics. Those who mask under their anti-Zionism a much deeper anti-Semitism fail to appreciate and understand the difference between the political dynamic and the self-determination of a people. We must remember that it is determination not of "I" or of "others" but of "self". In our debates, we need to tackle that question head on.
Finally, I suspect that, in many conferences or meetings of the left, a debate on anti-Semitism would have many speakers talking about the middle east. I rest my case on that point, as it highlights the problem that exists in some people's minds.
10.36 am
Richard Burden: I am grateful to those on the Front Benches for making time to allow me to speak.
I congratulate my hon. Friend the Member for Stalybridge and Hyde (James Purnell) on securing this debate. I speak as an individual Member and as chairman of the all-party parliamentary group on Palestine. I place on record that the group stands no truck with anti-Semitism. Indeed, I am proud to be the co-sponsor and co-author of early-day motion 123 on combating anti-Semitism, which stands in the name of my hon. Friend the Member for Ilford, North (Linda Perham).
We need to reject racism in whatever form it takes. There is an Islamic community centre in my constituency; it was doing no one any harm, but it was

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recently burnt out. What scared me about that was not that racists were responsible, but that otherwise perfectly rational people should have come up to me afterwards and said, "Yes, but if they weren't here, it wouldn't happen to them." That logic underlies anti-Semitism, as much as it does Islamophobia.
In the short time available to me, I want to say something about the relationship between our debates on Islamophobia and anti-Semitism and the situation in the middle east. It is true that some people criticise Israel, but some use that criticism as a cloak for anti-Semitism. We need to distance ourselves from such people and condemn their action. However, on the other side of the argument is the fact that criticism of Israel is also too easily conflated with allegations of anti-Semitism. We need to be equally careful about that.
In an intervention on my hon. Friend the Member for Stalybridge and Hyde, I mentioned Israel's right to exist. I make clear that I believe in the two-state solution—a secure Israel alongside an independent Palestine. However, there are different views on the solution to the middle east conflict.
An eminent Israeli academic called Jeff Halper has just written a book called "Obstacles for Peace" in which he says that the extent of the occupation and the matrix of Israeli control in the west bank is such that one could not have two states. He suggests that one solution would be to have a single state, in which all citizens—Jews, non-Jews, Christians, Muslims and people of no religion—could live together with equal rights. Would that be the end of Israel? It probably would. Would it be the end of Palestine? Yes, it definitely would. Does it mean that the author is a Jewish anti-Semite? No, it does not. The idea that someone like him could talk about throwing all Jews into the sea is nonsense. If we are to tackle racism properly in this country, we need to differentiate between people's motivations and what they actually say, and what it is convenient to believe they are saying in order to establish our position.
There is racism on both sides of the argument in the middle east. We need to reject it on both sides. Is anti-Semitism a problem in our communities? Yes, it is. Is Islamophobia a problem in our communities? Yes, it is. Is anti-Arabism a problem in our communities? Yes, it is. Are those that suffer from one type of racism sometimes susceptible to employing racism against others? Sadly, yes, they are. That is why, in this place, whatever our perspective on the middle east conflict, Israel and the rights of the Palestinians, we must be utterly consistent and uncompromising in our rejection of racism, from whatever direction it comes.
10.40 am
Mr. Alistair Carmichael: I am keen, since we have already curtailed our time, to leave as much time as possible for the Minister to reply, so a lot of what I might have said will remain unsaid.
I congratulate the hon. Member for Stalybridge and Hyde (James Purnell) not only on winning the raffle and securing the debate, but on the bulk of what he said and, more important in a debate such as this, on the way in which he said it. There were one or two points in his speech with which I did not agree: his reference to the equation between anti-Semitism and anti-Zionism jarred in my mind, but we could have that debate in this
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reasoned atmosphere. I much preferred his original definition of anti-Semitism as the hatred, fear, targeting or attack of Jewish people simply because they are Jewish. If we keep that as a definition, we can find much more common ground.
The hon. Member's debate is timely for two reasons. First, as he pointed out, there has been a rise in anti-Semitism. For so long since the second world war, this country has accepted a consensus that anti-Semitism is absolutely abhorrent. With the passage of time and other political influences, many of which are not well motivated, that consensus is in danger of breaking down. Debates such as this are exceptionally important. Secondly, to put it into its current political context, there will be election campaigns throughout much of England and Wales in the next few months, which will see a record number of candidates from the British National party. The BNP feeds on anti-Semitism and targets Jews and other minorities within society in a way that I, as a Liberal Democrat, find absolutely abhorrent. At a time when such activity has become an increasingly poisonous feature of our politics, it is important that those of us in the mainstream political debate are prepared to stand up and defend that consensus.
If I have any criticism of the debate, it is that it has been long on analysis and short on solutions. The hon. Member for Hendon (Mr. Dismore) referred to a demonstration whose tone was violently anti-Semitic, and said that two arrests were made, but that nobody was charged. We must consider that point seriously. I should be interested to hear from the Minister what the Home Office's thinking is about the need for legislation for hate crimes. We already have that north of the border, after my colleague in the Scottish Executive, Donald Gorrie, introduced a Bill—it is now an Act—to deal with sectarian violence and hatred, which is sadly endemic in parts of west central Scotland. If we identify anti-Semitism as a problem of that scale, as we have done today, surely the time has come for the Government to start to think about other actions.
One of the interesting pieces of research that I came across during my preparation for this debate was a report published at the end of last month by the European monitoring centre on racism and xenophobia, which pointed out that anti-Semitism is rising in Britain, Belgium, France, Germany and the Netherlands. That report used data provided by the Community Security Trust, which showed that there were 350 reported anti-Semitic incidents in 2002. That is a 13 per cent. increase on the 2001 total—a dramatic statistic. The report noted, however, that London's Metropolitan Police Service already records hate crimes such as those committed against the Jewish community, but that is not the case in Manchester and Leeds. Will the Minister confirm today that other police forces for which she has responsibility will carry out such monitoring? We all believe—indeed, we have almost a gut feeling—that anti-Semitism is wrong, and that there must be objective analysis of the scale of the problem in our society, which it is well within the Government's scope to do.
This has been an exceptionally useful and timely debate. I congratulate the hon. Member for Stalybridge and Hyde on securing the debate, and all hon. Members who have spoken in it. I hope that as well as analysing the problem, the Government will start to act to deal with it.
10.46 am
Mr. James Paice: I, too, congratulate the hon. Member for Stalybridge and Hyde (James Purnell) on securing the debate and on the very well developed way in which he presented his case. I also congratulate other hon. Members who have spoken. I was particularly impressed and interested by the powerful contribution made by the right hon. Member for Tyneside, North (Mr. Byers) on this very serious issue.
The hon. Member for Stalybridge and Hyde made the percipient remark that he would have considered many comments to be over-sensitive—I believe that he used the phrase "bordering on paranoia"—before he became the current chairman of Labour Friends of Israel. It was very interesting to hear him say that, since he has become more involved, he now realises that things are not as he might first have thought. He says that as a Jewish person. I am not a Jew, but I believe that it is totally irrelevant whether one is a Jew, black or a member of any other race or creed. We must treat people as individuals, regardless of their attributes.
No doubt, anti-Semitism is the oldest form of racism at least in the known history of the western world. That in no way makes it more acceptable; indeed, in many ways that makes it even more evil. The fact that it has not been eradicated before makes it even harder to eradicate now. I will not repeat the figures, which the hon. Member for Stalybridge and Hyde cited, for the increase in the number of hate crimes that have been committed. I shall, however, stress a point that has already been made. I was brought up to associate anti-Semitism with Nazism and the extreme right, but it is increasingly becoming a feature of the left and is being linked, in particular, with some sections of Muslim society. Interestingly, the European Union monitoring centre report made the statement, which it qualifies by saying that it is not easy to generalise, that a further source of anti-Semitism in some countries was young Muslims of north African or Asian extraction. Traditionally, anti-Semitic groups on the extreme right played a part in stirring opinion. That underlines the fact that there is a problem at both ends of the political spectrum.
Several hon. Members made a point that goes to the heart of the issue: we should not confuse criticism of the actions of this or any other Israeli Government with a form of anti-Semitism. As hon. Members have said, there is no doubt that many people criticise the actions of the current Israeli Government as a way of criticising all Jews. That is absurd. I hope that hon. Members will accept that it is just as absurd for the Israeli Government to suggest that all their critics are automatically anti-Semites. That is certainly not the case and, as several hon. Members have said, some of the strongest critics of the Israeli Government are Jews. It is just as absurd as President Mugabe suggesting that any criticism of his regime is automatically racist—it is not. It is patently absurd to make that allegation, and the two are close analogies.
We must be tolerant of other religions and of other races and creeds. It is easy to find reasons to object to other people—there are objectionable people in the world from all backgrounds. That is not related to religion, creed or colour; it is a natural part of human
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existence. The intolerance of racism and religious discrimination has been the largest cause of conflict over the centuries and is so today.
I conclude by proffering the solution, although it is not a detailed policy, that anti-Semitism must be considered as abhorrent and given the same profile as racism against black people or discrimination against people of different sexual orientations. In those cases, it has become accepted that we do not discriminate and that such discrimination is abhorrent. There is a belief, as the right hon. Member for Tyneside, North touched on, that anti-Semitism is somehow more of an intellectual position and more acceptable than criticism of someone because they are black, but that is wrong. It must be considered as being just as evil and abhorrent as all other forms of racism and religious discrimination. If we do that, we will begin to address what is a fundamental problem. The intolerance that accompanies anti-Semitism, to which several hon. Members have referred, is not only wrong but is extremely dangerous for the peace of the world.
10.52 am
The Parliamentary Under-Secretary of State for the Home Department (Fiona Mactaggart): I hope that hon. Members will forgive me if in eight minutes I cannot respond to all the important points raised. That would not be possible but I want to echo some of those that were made. The first is the comment made on all sides about the important contribution that the Jewish community has made to British society. As the Minister responsible for charities, I am constantly reminded of the generous contribution that the Jewish community makes to charitable life. It is a coincidence that this afternoon the Home Secretary and I will meet the Board of Deputies of British Jews as part of the regular dialogue with that community and others about their role in society.
I shall also concentrate on the profound scar that all forms of racism, and specifically anti-Semitism, place on society. I congratulate my hon. Friend the Member for Stalybridge and Hyde (James Purnell) on arranging the debate because he is right to highlight the growth in anti-Semitism and the risks to people. That can be done without generating unnecessary fear, but we must recognise that it is an important issue facing us all and with which the Government have a responsibility to deal robustly.
The European monitoring centre on racism and xenophobia report revealed that the United Kingdom was one of five EU states that have experienced a rise in anti-Semitic incidents in 2002–03. Its figures corroborate those of the Community Security Trust and the Metropolitan police, which also show a growth in race attacks. My hon. Friend the Member for Hendon (Mr. Dismore) asked about the monitoring of those incidents, and I can tell him that, together with the Institute of Jewish Policy Research, the Metropolitan police is conducting research into such incidents to get a more accurate feel for their nature and to develop a more effective response to them. That is something that we have considered at various points in this debate, and the response can be made partly by effectively targeted actions and partly by effective legislation and prosecuting criminal acts such as incitement to racial hatred.

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Generally, we have tough and effective legislation in the UK, including the legal framework against race discrimination. Specifically, the additional penalties for criminal offences such as incitement to racial hatred and racially and religiously aggravated assault and criminal damage have been used effectively to tackle some of the problems. I was pleased that the Crown Prosecution Service recently gave a public commitment to prosecute racist and religious crimes fairly, firmly and robustly. The aim of that statement was not just to encourage prosecutors to take on such prosecutions, but to send a clear message to perpetrators that they will not get away with threatening, violent or abusive behaviour towards members of racial or religious groups.
My hon. Friend the Member for Hendon will feel tempted to ask, "But what about the examples that I raised?" and he was right to highlight the evil acts of al-Muhajiroun in many cases. I hope that he will be reassured by the fact that there have been a number of successful prosecutions of people who share its views. Abdullah al-Faisal was sentenced to nine years in prison for soliciting murder and inciting race hatred against Jews and Hindus. We closely monitor and will continue to monitor the activities of al-Muhajiroun, its web broadcasts and its organisations in universities and other places that encourage youngsters to support its views. I recognise the continuum that my hon. Friend identified as running between some of that group's statements and the more violent terrorist activities among young people. That is one reason why the Home Office has put an extra £15 million into focusing on terrorist activity. It is important that we deal with it effectively.
I want to use the final minutes to deal with the most difficult issue on which my hon. Friend the Member for Stalybridge and Hyde and many other hon. Members focused, which is the important question of how anti-Semitism works. It is clear that criticism of Israel is not anti-Semitic in itself—we are all agreed on that. There is a place for legitimate democratic debate about domestic or international affairs, including Israel and the middle east, but it is completely unacceptable if such criticism manifests itself in a discriminatory, threatening, harassing or violent form that is directed at people because they are Jews.
That is the important point. People become a victim in such cases because of their race or religion, and that is why we have put additional penalties on offences. Race hatred has a terrorising effect on the whole community, and it is important to recognise that that is the reason for having additional penalties.
The hon. Member for Orkney and Shetland (Mr. Carmichael) was right to say that the British National party will make its arguments in coming elections. Such groups will say that they are being picked on, but their activities terrorise classes of people. If people who criticise Israel fall into the trap of stretching their language to add weight to the table and suggest that all Jews are wrong, that is unacceptable and contributes to that terrorising effect.

PC Gerald Walker
11 am
Mr. Graham Allen: I rise to introduce a serious debate on a matter of great concern to many Members of Parliament. Perhaps I may break with tradition by acknowledging the presence in the Gallery of Mrs. Tracy Walker, the widow of PC Ged Walker. No amount of debates, Acts of Parliament, meetings with party leaders or anything else can achieve what we would all wish for—turning back the clock on the events that have taken place—but I hope that Mrs. Walker sees today that Parliament takes her tragedy very seriously indeed.
I would also like to put on record Parliament's tribute to PC Ged Walker. He made the ultimate sacrifice in losing his life—as so many of his colleagues are prepared to do, today and in the future—to maintain law and order and to ensure that our streets are safe. There are many lessons to be learned and I am pleased that my hon. Friend the Member for Broxtowe (Dr. Palmer), Mr. and Mrs. Walker's Member of Parliament, is here today. He has, on behalf of Mrs. Walker, been foremost among those pressing the case repeatedly and I know that he will continue to be so. Although my hon. Friends the Members for Gedling (Vernon Coaker) and for Bassetlaw (John Mann) can be here only to pay their respects, their presence is a measure of the importance that this debate has for us in Nottinghamshire. Other colleagues have also expressed their support for the holding of the debate, which I have been lucky enough to introduce.
PC Gerald Walker should be alive today. He was killed in my constituency in January last year while trying to stop David Parfitt, a drug user and convicted robber, driving off in a stolen taxi. PC Walker suffered head injuries after being dragged along by the speeding car and he died in hospital. Parfitt was out of prison on an early release scheme. As he had breached his release licence more than three months earlier, he should have been back behind bars.
The inspector of probation, Rod Morgan, was asked to inquire into the tragedy. Indeed, I am pleased to note the presence of the director general of the probation service, which, again, underlines the importance of the case. Professor Morgan reported back around four weeks ago with a series of recommendations, and he is certainly right to highlight the need for cleaner and swifter co-ordination between prisons, probation and police. I gather that the Home Office, local police and probation officers have all welcomed and accepted his key recommendations, but we must go further to tackle the immediate and the more deep-rooted problems that this tragic case has revealed.
Dr. Nick Palmer: Before my hon. Friend moves on to the more general issues, perhaps he will say how Mrs. Walker and the public can be confident that the promised reforms, which were requested or demanded in the report, will be implemented. Does he agree that the probation service needs to ensure that its staff are fully trained in respect of the new regulations? Is it not essential that an explicit review of progress be conducted to ensure that such

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commitments are being met? Is it not also vital that the probation service receive adequate funding to discharge its responsibilities?
Mr. Allen: I agree very much with all the points that my hon. Friend makes. I should say again how assiduous he has been in pursuing all aspects of the case, and I suspect that his assiduity and that of fellow Nottinghamshire Members of Parliament will not diminish as the months go by. It is incumbent on us all to ensure that the lessons are learned. I know that my hon. Friend and I will pursue that aspect of the case, and I am sure that my other hon. Friends from Nottinghamshire will do so as well.
In addition, I look forward to the Minister's winding-up remarks. I am sure that she too is keen to ensure that the report does not gather dust and that the recommendations made will be followed through. I think she knows us all well enough to know that we will continue to chase this up and aim to ensure that the recommendations are implemented so that the lessons can be learned.
One of the immediate lessons that we need to consider from the case is this: when a prisoner's licence for temporary release is breached, as when Parfitt tested positive for cocaine use, the offender should be returned to prison immediately. I know that there are difficulties with that and that it would not be easy. None the less, the person being tested should be required to wait in the testing area—the office, centre or whatever—until the results come through. As I understand it, a straightforward swab test is involved and the results can be delivered very quickly. An immediate decision could then be made, perhaps on the authority of an assistant chief probation officer, either to release that person back on licence or to ensure that that person is taken back to prison immediately. I see my hon. Friend the Member for Bassetlaw nodding, and we all know that he has great experience and expertise in this area.
All would benefit from the certainty and immediacy of such a procedure. It would also help to reduce the horrendous work load and bureaucracy referred to in the Morgan report. That is clearly one reason for probation officers labouring under an immense burden about which we can only sympathise. They are trying to clear up all that paper and some clarity on the issue would help everyone.
Dr. Palmer: I want to put it on the record that Mrs. Walker and a number of PC Walker's colleagues are frustrated by what they see as the elusive nature of the responsibility for what happened. It needs to be accepted clearly that this is not just a question of excessive work load. Specific mistakes were made by specific people.
Mr. Allen: I am confident that that is the case, and I endorse my hon. Friend's remarks. Perhaps one or two suggestions that I shall make later will address some of those points specifically.
If the person who is in breach is not on the premises, the police should be told immediately by the probation officer responsible, informing a named police officer
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who would be responsible for the service, and an arrest should be made without delay by local officers familiar with the offender. The probation service and the Prison Service should perhaps pilot the employment of enforcement teams to return those who breach their release conditions, thereby creating a unified service less prone to the communication breakdown identified in PC Walker's case. An alternative might be seconded police officers who are dedicated to enforcement and detention when a breach occurs.
There are a large number of specifics, which I am sure the Minister will address in her winding-up speech. I am very pleased that we have this Minister, with her expertise in drug testing and enforcement, here to respond to the debate.
The lessons go far beyond the immediate responsibilities for the bureaucratic practices and poor interfaces revealed by the Morgan report. The Government, Parliament and the judiciary need to look at themselves if another such tragedy and a thousand smaller ones like those that happen every day and never come to public attention are to be avoided. For example, I have written to the National Criminal Justice Board asking it to address the deceit that still passes for sentencing policy. I have yet to receive a reply, so I look forward to receiving one without too much further delay.
Sentences should be honest and comprehensible, not only to criminal justice professionals, but to victims, witnesses and taxpayers. When judges give a one-year prison sentence, plus one year out on licence, they should not announce it as a two-year sentence, as happened in the Parfitt case. That practice, which is often abetted by sloppy media reporting, diminishes public confidence in the criminal justice system and it should be addressed by the new Sentencing Guidelines Council, the Home Office and the Department for Constitutional Affairs. We must bring back public confidence in sentencing. This is not a plea for heavier or harder sentences; it is just a plea to be honest with the public about what sentences mean. People should not need a legal dictionary to understand what a judge is saying when sentencing an offender.
In addition, the Government, at the highest level, must review the wholesale retreat of public service provision from the front line, especially in the outer-city estates. A rethink is needed on the policy of short-term savings, which result in a massive economic and social cost. The drive to pay state benefits directly to individuals is leading to the closure of post offices, which removes a pillar that supports the outer-city shopping precincts. That is echoed in this case by the flight of local probation officers from local communities, the consequent loss of networks and informal multi-agency working, and an erosion of local knowledge and sensitivity. The new criminal justice boards, which have been set up on a county-wide basis, need local one-stop shops, rather than huddling together away from their customers and the public. Let us get those services back out on the estates, face to face, where they are needed and where people understand them. It is absolutely pointless passing Acts against antisocial behaviour while stoking up its causes with other policies. We must have joined-up thinking in this area.

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National policy made by the Government and the civil service must reconnect with on-the-ground delivery. We need to give clarity to officers—in this case, officers who had to deal with half a dozen different drug orders—on when an order is breached and the expectations of enforcement. That applies equally to the failure of national policy to involve communities practically in community sentencing, of which all of us in this Room have seen evidence. We must make antisocial behaviour orders work. Despite national intentions, there is some confusion in the Nottingham magistracy about whether hearsay evidence from the police can be accepted and whether a high level of criminal proof, rather than a lower level of civil proof, is needed to demonstrate a breach of an antisocial behaviour order.
It may seem a long way from the tragic death of a police officer to the inadequacies of the British constitution and how the Government work, but if the Government allowed Parliament to do its job the two-way street involving local best practice informing good national policy and vice versa could be unjammed. Of course, the Government should make policy, but they should hand back law-making to Parliament, enabling it to do its rightful job of conducting proper legislative scrutiny to turn national policy proposals into practical law.
Pre-legislative scrutiny should be done online, so that practitioners, victims, communities and others can participate in making better, more practical law together. I note the attendance today of Nottinghamshire's chief probation officer. It is inconceivable that those involved in the process for framing early release and drug-testing orders would not have benefited massively from listening to practitioners and consumers—perhaps a death could have been avoided. We should not depend on entrepreneurial Members of Parliament chasing the Lord Chancellor and other Ministers to clean up defects in legislation long after it has been enacted.
There should also be a proper process of post-legislative scrutiny to ensure that the policy operates as intended in the light of experience. There are local lessons to be learned. Indeed, there are lessons to be learned by all of us—including Members of Parliament, the Government and the judiciary—from this awful case, which occurred in my constituency and involved the constituent of my hon. Friend the Member for Broxtowe. What is not in doubt is that lessons must be implemented from the front line, by practitioners such as local probation officers and police officers, right up to the Head of Government—the Prime Minister. If those lessons are not learned—I give the Minister a guarantee that we will follow this through—the death of a brave local police officer will be a greater tragedy than it already is.
Thank you for allowing me to introduce this debate today, Mr. Deputy Speaker. Once again, I hope that it stands as a small tribute to the life of PC Ged Walker and the tireless efforts of Mrs. Tracy Walker to ensure that we all learn something from this awful tragedy.
11.16 am
The Parliamentary Under-Secretary of State for the Home Department (Caroline Flint): I thank my hon. Friend the Member for Nottingham, North (Mr. Allen)
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for securing the debate. I am grateful for the attendance of my hon. Friends the Members for Broxtowe (Dr. Palmer), for Bassetlaw (John Mann) and for Gedling (Vernon Coaker), who have now left the Chamber. I also acknowledge the presence of Mrs. Walker here today.
The spur for the debate, as we have heard, was the tragic death of PC Gerald Walker, known as Ged to his family and friends. PC Walker, an officer of the Nottinghamshire constabulary, was killed in January 2003 by the offender David Parfitt, who was then unlawfully at large following his recall to prison for a breach of his parole licence. That recall was triggered by a succession of failures to comply with the terms of his licence, including missed appointments to attend the probation service for testing for the presence of class A drugs, and a number of positive tests for such substances.
Following David Parfitt's conviction for the manslaughter of PC Walker, my hon. Friends the Under-Secretary of State for the Home Department, the hon. Member for Wythenshawe and Sale, East (Paul Goggins)—who is responsible for correctional services—and the Minister for Crime Reduction, Policing and Community Safety ordered an inquiry into the events leading up to and following the tragic killing of this brave officer. Unfortunately, my hon. Friend the Under-Secretary cannot be here today, because he is engaged on other parliamentary business, but he has spoken to me and the Minister for Crime Reduction, Policing and Community Safety and he will try to be here for the end of the debate and to meet Mrs. Walker if she wishes him to do so. He has told me that he would like to take this opportunity to express the Government's condolences over the death of this dedicated officer in such tragic circumstances. I offer my own condolences to Mrs. Walker and her two children.
On 25 March, Professor Rod Morgan, who was then Her Majesty's chief inspector of probation, submitted to the Under-Secretary his report on the inquiry into PC Walker's death. The report identified a number of failings at local operational level and in relation to the national policies that underpinned local practice. The chief inspector was of the view that if practices had been handled differently, they could have resulted in the earlier revocation of Parfitt's parole licence and the possibility of his earlier arrest and return to prison. Professor Morgan's report includes 10 recommendations that he believes would, if implemented, reduce the risk of similar failings arising in future and, in so doing, would contribute to the greater safety of the public. The Under-Secretary laid a copy of the report in the Library on 25 March, together with a detailed action plan setting out how the police, prison and probation services will implement the inquiry recommendations.
My hon. Friend the Member for Broxtowe asked how that would be followed up. The Under-Secretary has asked the director general of the national probation service to be personally responsible for reporting the delivery of change in line with the published action plan, and has set a challenging deadline of this October for that to happen. I am sure that, once that report is provided, there will be other opportunities for hon. Members to raise issues.

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In the opening speech, my hon. Friend the Member for Nottingham, North reflected the thrust of the recommendations of the Morgan inquiry, but he rightly asked us to look further at the environment that contributed to the circumstances leading up to PC Walker's death.
The Government have always made it clear that we will not tolerate criminals who prey on society, and we have taken measures that are having an impact on crime. Overall, crime—as measured by the British crime survey—fell by 25 per cent. between 1997 and 2002–03, but we cannot be complacent. My right hon. Friend the Home Secretary has been forthright in saying that prison is the right place for those who present the greatest risk to the public, either because they have committed serious sexual or violent crimes or because they are prolific and persistent criminals. Equally, if we are to be successful in bearing down on crime, we need to have in place a range of tested models that support offenders in addressing their criminal behaviour. I know that only too well from having to deal with those offenders who, because of their drug addiction, create a huge amount of crime. We have in place programmes to address that problem by providing treatment to try to get such offenders off drugs, and therefore to reduce the crime rate. However, it is a challenging situation; and there is no short-term solution.
Mr. Allen: I thank the Minister for generously giving way. To underline her point, she may be aware that more than 60 per cent. of offenders over the age of 18 who are held overnight in Nottinghamshire test positive for class A drugs. That is an appallingly high statistic. In that context, will she consider focusing some activities on drug testing orders? There seems to be a plethora of such orders, but, without excusing any actions, it is easier for people to operate with a more tightly defined and focused number of drug testing orders.
Caroline Flint: It is certainly the case that we need to consider how the orders operate. The new National Offender Management Service will consider how better to address the criminal behaviour of individual offenders, and will also consider the use of the generic community order, which could have drug treatment and other associated drug elements attached to it. However, we must make clear that whatever laws Parliament passes have to be implemented in a way that people understand, including the probation officer and the police officer on the beat.
Whether the offender serves his or her sentence in the community or in prison, the public must have confidence that the criminal justice system is operating effectively and with proper regard for their safety. That is why local implementation is so important. My hon. Friend pointed out the thuggish and antisocial behaviour that increasingly blight our town centres and out-of-town areas and which cause real concern to many. We must deal with those concerns, as well as pressing down hard on crime itself. He also pointed to several ways in which that pressure could be made more effective.
My hon. Friend spoke also about pre-legislative scrutiny of Bills, and of a later parliamentary review of the effectiveness of legislation. The Home Office is
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constantly looking at various issues—I in my area, and my colleagues in theirs—including how DTOs are working, how different parts of the country seem to be handling such matters differently and possibly having better results, and what we can learn from good practice.
My hon. Friend rightly identified several issues aimed at establishing confidence in the criminal justice system. For example, he mentioned sentencing, which is important. Transparency in sentencing can have a great impact on the public's understanding and confidence.
The Criminal Justice Act 2003 imposed a general statutory duty upon courts to give reasons for, and to explain the effect of, the sentence passed. The general duty consolidates and strengthens the various requirements that are currently scattered throughout different sentencing statutes. That duty requires the court to explain in open court and in simple language why a particular sentence was considered appropriate.
The court will also be required to explain the practical effect of the sentence passed. That explanation will set out how the sentence is actually structured—for example, how long the offender will be required to spend in prison before being considered eligible for release; what requirements the offender must adhere to; and what will happen to the offender should he breach his sentence. Those explanations will enable the offender and other interested parties, including victims, to understand why a particular sentence was chosen and how it will operate. I hope that that will promote public confidence in the criminal justice system.
The introduction of the Sentencing Guidelines Council will also encourage greater transparency and consistency in sentencing. The council will be independent and chaired by the Lord Chief Justice. It will aim to produce a more robust and comprehensive set of guidelines for all courts, enabling them to approach cases from a common starting point.
My hon. Friend's reference to the strict enforcement of licence conditions is relevant here. The effective and rigorous enforcement of breaches is critical if the courts and the public are to have confidence in community-based provision. Compliance with licence supervision is, I am pleased to report, generally good at around 89 per cent. However, when a licence is breached, action must be taken quickly and in accordance with the probation national standards. As the Morgan report identifies, that was not done in David Parfitt's case.
There are clear lessons that must be learned from the awful events in question. The probation service, and other enforcement agencies, including the police and magistrates courts committee enforcement staff, are already working with the national criminal justice board to review all enforcement practice and to see where improvements can be made. I shall make sure that a copy of today's debate, with my hon. Friend's points, is made available to those agencies.
The review will examine whether the various agencies have the necessary powers to ensure that enforcement is effective. Closer working links, more effective communication and a better local understanding of the roles and responsibilities of the various criminal justice agencies are fundamental to better working and, ultimately, improved public confidence in the criminal justice system.

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Issues to be considered include local access, and the way to provide such access is the subject of debate. Perhaps I may take the probation service as an example. When the 54 probation services were integrated into a single national probation service of 42 areas, in April 2001. the new national service found that it had a portfolio of more than 1,300 properties. It recognised the need for an improved offender management environment and set out a commitment to try to provide accommodation fit for that, and suitable for the staff, in the work that they wanted to do for the people whom they support, or whom they monitor, if they are on contracts. The service also recognised its duty to its staff to provide a safe workplace.
In response to those changing service delivery needs, increased offender contact and more active intervention, the accommodation needs of the service have undergone a period of continuous, careful review, led by the local probation area's assessment of operational needs. However, even if one does not have an office on one's doorstep—and there is not one in my constituency—this is a matter of local access, relationships and good communication. A Member of Parliament may want to know where to go to find answers to issues raised in surgeries, but the issue of access affects the wider community as well. That is just as true in this context as in the work that I do with drug action teams.
Mr. Allen: The Minister is very generous in giving way again. I have mentioned to her that when I began as a Member of Parliament there were at least three different probation officers, in their own local offices, in my outer-estate-based constituency in Nottingham. I could pick up the phone and have an informal discussion with those officers, and it would often involve social services, housing or other departments. Through that informal network it was possible to take positive steps to help offenders and to help the community make sure that offenders' treatment was robust and adequate. That no longer happens and I no longer have that relationship with the probation service.
Will the Minister consider the fact that perhaps the pendulum has swung too far towards consolidation and centralisation and that we should be looking at a wider
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dispersal of people to the front line, where the problems are—and where the public whom we need to serve are, too?
Caroline Flint: We have representatives here from Nottinghamshire probation service, and I am sure that they have listened to what my hon. Friend has said.
The area that we are considering is complex, and deals with a complex group of people. The work in which I am directly involved concerns people who commit offences because of their drug addiction, and in some parts of the country probation officers work in buildings with treatment providers: perhaps that does not happen 9 to 5 every day, but there is a connection there. That is also part of how we deal with the problem.
In some ways, it is not a matter of the offenders coming to the professionals; it is a question of professionals—whether they are probation officers, police officers, the people who provide treatment if drugs are involved, or others who can deal with social housing needs, employment or education—identifying ways to engage people who may not turn up for appointments, as in the case that we have heard about today, and how that should be followed up.In this complex area of work, the key is trying to ensure that different individuals work together across agencies. Sometimes that will mean that several agencies occupy one building.
My hon. Friend raised several issues such as breach of antisocial behaviour orders, and my hon. Friend the Minister for Crime Reduction, Policing and Community Safety will write to him about that with some good news.
I thank my hon. Friend for introducing the debate. There are some wide-ranging lessons to be learned from the death of Ged Walker. We need not only to learn from this one case, but to be constantly vigilant about the policies and laws that we pass in Parliament, and how they are implemented. Constant scrutiny and evaluation is needed, without undue bureaucracy, so that we make sure that policies are working and are understood by those who implement them.
11.29 am
Sitting suspended until Two o'clock.

Mathematics and Science Teachers
2 pm
Dr. Vincent Cable: May I express my appreciation for the opportunity to introduce this Adjournment debate? The subject is timeless, but it is also highly topical, because this is the first opportunity that party spokesmen and other Members, of whom dispiritingly few are present, have had to comment on Professor Adrian Smith's report, "Making Mathematics Count". The report is of major importance not only for educationalists and schools, but for the wider economy.
The Secretary of State deserves some credit for having chosen a hard-hitting professor to examine the problem. The comments and analysis that have emerged from the report have been worryingly harsh. At the launch of his report, Professor Smith said about specialist maths teaching:
"Everyone I have spoken to says the position…is a disaster…There is a dire, catastrophic crisis level shortage of specialists."
That is fairly hard-hitting. The problem is clearly very serious. It is also tricky, and not easily defined and turned into one quantifiable bite. The analysis reveals a vicious circle in which a succession of problems feed on each other and are brought to a head at GSCE level, from which far too few students emerge with mathematical skills suitable for modern apprenticeships.
In addition, far too few students study the top tier of mathematics that enables them to go on to AS-level. Too many students fail AS-levels and too many do A-levels. Far too few study further maths, which is increasingly becoming the preserve of the private sector, and far too few study maths, physics and chemistry at university. The number of students studying physics and chemistry is steadily declining, and there are far too few graduates as a consequence. Of those graduates, far too few go into teaching or teaching teachers. We therefore have a vicious circle in which one shortage and inadequacy feeds on another.
I will discuss in a moment the details of that vicious circle and Smith's analysis of the problem and his suggested remedies, but before I do so, I must tell hon. Members that I took up the matter partly because of constituency concerns. I am sure that other constituencies have more mathematicians, scientists and PhDs than mine. I imagine that Cambridge or the two Oxford seats outbid Twickenham, but it has a substantial concentration of scientific institutions. For example, we have the National Physical Laboratory, a Government-owned institution and a centre for physics research in general and for metrology in particular, which is the science of measurement. When people talk about Greenwich mean time, they tend to forget that they are actually talking about Twickenham time or, more precisely, Teddington time, because Teddington is where the atomic clocks are.
We also have the Laboratory of the Government Chemist, which is a very successful example of a privatised former Government research laboratory that now does a lot of basic standards work and very high-level research. We also have large numbers of small IT companies. Consequently, the maths and science results
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of schools in my borough regularly put those schools at the top of the league tables, for what those tables are worth, which clearly reflects the background of many of the parents. I therefore have a local interest in the subject as well as a broader one.
I have a broader disciplinary interest in economic policy, both personally and as a spokesman in the House. I want to link this subject to the wider question of how the deficiency in maths and science education is seriously affecting our economic performance. I am very sceptical of many of the things that the Government supposedly do to support industry, which is one reason why I argued for the abolition of the Department of Trade and Industry. I have no doubt that the Government have a critical role to play in education, and in educating maths and science teachers in particular.
The economic importance of maths and science was underlined by another report that was published recently by the Science, Technology and Mathematics Council, which dealt specifically with what it calls mathematical literacy. Such concepts are a little elusive. Mathematical literacy is a broader and deeper concept than numeracy—it is not only about adding and subtracting, but about manipulating mathematical ideas such as proportions and percentages.
It is difficult to be precise about mathematical literacy. Teachers in our constituencies tell us about cases of seriously challenged pupils who consistently fail maths GCSE but go on to become market traders or bookmakers and display a brilliant understanding of the laws of probability and permutation far in excess of most PhD holders. Mathematical literacy is not necessarily formal and academic; it reflects a wider set of attributes.
The Science, Technology and Mathematics Council's study came to several clear conclusions. First, mathematical literacy is of growing importance to the economy and specifically to industry. Secondly, the need for it is moving steadily down the job hierarchy. That is a counter-intuitive conclusion because we have been brought up to think that as long as people have calculating machines they do not need to be competent with numbers. Manual workers, however, such as those working at supermarket counters, need to be increasingly mathematically literate because they need constantly to cross check and deal with anomalies, and they cannot do that unless they have calculation skills. Thirdly, the study makes the point that there is a perception that standards of mathematical literacy are falling. It does not suggest that standards are necessarily falling—that is a difficult thing to measure—but that the perception is that they are.
The study goes on to illustrate areas in the economy for which those findings are crucial; IT is an obvious example. In addition, growing industries, such as pharmaceuticals, require a large number of people from research level to technical lab assistants who desperately need to be mathematically literate but frequently are not. The study highlights the national health service as a key area and mentions the growing problems in respect of nurses who are admirably competent and excellent at caring but do not have the capacity to measure drugs or interpret graphs and numbers on screens. That is a serious impediment to health service delivery.

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A lack of mathematical literacy also affects the financial services industry. Our constituents have problems with endowment mortgages and credit card interest rates, which often assume an understanding of compounding that many constituents, not to mention financial advisers, do not have. The industry is severely disadvantaged by the lack of such competence.
The economic importance was reinforced by a message that I received shortly before the debate from the Engineering Employers Federation, which pointed out that only 43 per cent. of people studying GCSEs achieve A to C grades. Importantly, that is the minimum qualification needed in maths and English to undertake a modern apprenticeship scheme. As most of that 43 per cent. go on to study A-levels, the number remaining to go into industrial work at a technical level is small and declining, and the federation is alarmed about that.
I shall now proceed to what Professor Smith said in his report. There are two key elements of the analysis: the first relates to the shortage of specialist teachers, and the second to deficiencies in the curriculum. I have already said that he considers the position disastrous in terms of specialist teachers. The disaster is manifested in both quantity and quality—the fewer the teachers, the more non-specialists are teaching and therefore the lower the quality. I shall provide a few stylised facts that illustrate the points that Professor Smith is making about the lack of quantity and quality. He points out that there is probably—it is difficult to be precise—a shortage of 3,400 maths teachers, which is 16 per cent. of all vacancies. There are also serious shortages in science and IT. In the long term, to fill that shortage, it would be necessary to recruit 40 per cent. of all maths graduates into teaching, which is unachievable given current market conditions and the alternatives available to those with maths degrees.
I acknowledge that the cup is half full as well as half empty, and progress is being made in teacher training recruitment. Last year's figures are encouraging and attempts have clearly been made to deal with the problem. However, I hope that the Government will acknowledge in an equally open spirit that they have failed to reach their targets every year. The figures from Professor Howson of Oxford Brookes university, who is one of the leading authorities on the matter, suggest that the Government will again fail to meet this year's recruitment targets.
Moreover, the problem in terms of the structure of the profession is getting worse rather than better. The age profile of maths teachers is old: 30 per cent. are over 50—a higher percentage than in any other subject—and only 15 per cent. are under 30, which is one of the smallest percentages. There are similar disproportions in science, and they are even worse in teacher training: half those involved in the training of maths teachers are over 50. There will thus be a replacement bulge in addition to the built-in problems of recruitment, which will affect quality as well as quantity.
The following are some of the examples given in the report and elsewhere of the qualitative problems associated with the lack of specialist teachers: 26 per cent. of all people teaching maths in schools do not have a qualification beyond A-level—the proportion was 20 per cent. seven years ago; the recent Ofsted analysis of key stage 3 teaching found that a third of all classes were seriously deficient; a third of entrants into science
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teaching have a third-class honours degree or lower; and many physics and chemistry teachers have not done maths beyond GCSE level, so the problem spreads to other subjects, too.
The most damning figures of all are in the table in the Smith report that contrasts the British situation with that of other OECD countries. The study shows that in terms of the proportion of schools that are currently suffering from a deficiency in the quantity or quality of maths teachers, 23 per cent. of British schools are affected in respect of science, as against 12 per cent. in the rest of the OECD, and 29 per cent. are affected by shortages in respect of maths, as against 12 per cent. in the rest of the OECD. One cannot make absolutely precise comparisons, but the figures in terms of competitiveness and relative comparisons are worrying.
Smith discussed the implications for the curriculum in schools and the cause-and-effect relationship. He said that the three-tier GCSE is "disastrous", and that we had completely lost the plot on. GCSE. There are too few people at the top end and pupils are not being stretched sufficiently to go on to do A-levels, let alone further maths, and at the bottom level too few achieve even the minimum standard. Smith described curriculum 2000 as a disaster because of its effect on maths. In the first year, there were large numbers of failures, which in turn meant that in the following two years much smaller numbers took the course. That will feed through the pipeline of universities and teacher recruitment for years to come.
Most serious of all is the number of people taking maths and science at A-level. Since 1997-98, the period for which the Government are responsible, there has been a fall of 20 per cent. in the number of A-level maths students. It is true that in the last year that has recovered significantly, which is a positive countersign, but there is no relief in respect of chemistry and physics, where there has been a decline of 17 per cent. and 11 per cent. respectively, with no recovery.
David Taylor: I am grateful to the hon. Gentleman for giving way and I apologise for missing the first few minutes of his speech. Will he take this opportunity to correct his inadvertent comment that the majority of those who got grades A to C at GCSE—43 per cent.—would go on to A-level? In fact, the figures are much worse than that: of the 600,000 pupils who take GCSE maths, 90 per cent. drop the subject, leaving only 60,000 taking A-level. Some 90 per cent. of those drop the subject before university, leaving as few as 6,000 going on to maths degrees. Is that not the serious problem?
Dr. Cable: That was an extremely helpful intervention. Those are useful numbers, and I am sure that they are right. They reinforce the fact that the position is serious. I was trying to make a slightly different point. It is because of the small numbers getting GCSE, in addition to the limited numbers going on to academic work, that there is a shortage of people who are able to go into proper vocational training.
In conclusion, I should like to talk a little about where we go from here and what the policy implications are. It is probably useful to preface my comments by saying that there are clearly no easy answers. We are dealing

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with a big and complex problem. Intervention at one precise point will not solve that problem. There is a sequence of difficulties. I shall touch on several of Professor Smith's conclusions and ask the Minister to tell us how the Government view them.
The first and most radical conclusion is Professor Smith's judgment that there has to be a much greater use of market forces in respect of mathematical teaching and, by implication, sciences. He acknowledges that the Government have gone some way down this road through golden hellos and teaching bursaries, which are attractive, but only to new entrants. They do nothing for those already in the profession. He raises the possibility that if market forces were operating in this area, maths teachers might be paid £10,000 more than their colleagues.
When that proposal was made in relation to science teachers in the Roberts report, the Government rejected the idea that there should be such disparities. I can see the obvious problems in terms of staff room morale, not to mention cost. None the less, there is clearly a problem here. I should be grateful for the Minister's reaction. Does he see the proposal as the direction in which recruitment should move? Should there be a greater use of incentives and should they apply to existing teachers as well as new teachers?
Secondly, there is a whole set of ideas for recruitment, some of which are quite challenging. The point is made that whereas there is a shortage of 3,400 maths teachers, there are 7,000 other maths teachers who are not teaching maths. Some of them are teaching subjects such as IT, and pulling them out of such subjects will create another shortage. That is not a magic cure, but how big a potential is there in that area? What can be done to steer that unused resource in a more productive direction?
The suggestion is also made that maths and physics undergraduates might be used in the classroom, presumably working as classroom assistants. Given the current reaction of the teachers' unions to classroom assistants, that might not be the most popular idea around. None the less, it is unconventional and interesting and I see no fundamental objection. It would be interesting to hear how the Government see it.
The report also makes a perhaps more practical suggestion about the importance of in-service training. It makes the point that if we are to get to a position where no child has to be taught by an unqualified teacher in a particular specialism, which is what we surely should achieve within a reasonable period of, say, three months, the only practical solution is to have a great deal of in-service training. People who may not be maths or science graduates should be able to train in post. Professor Smith makes the further suggestion that people should be qualified to teach at different levels. In other words, why not have teachers who can teach up to key stage 2 or 3, not necessarily to A-level, and have more variegated standards of training and certification? That seems eminently sensible.
A third set of recommendations relates to how to encourage students to do more in maths and science. It makes the radical suggestion that GCSE maths should count double and that A-level maths should count
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double for university admission. One can see the obvious problems if that were extended to many other subjects but it seems an obvious practical suggestion. I do not see the fundamental downside to it. Again, the Government might want to give their reaction.
David Taylor: I thank the hon. Gentleman for giving way again. There is nothing new in that suggestion. It represents a reversion to what was common in the 1960s, when I took A-level mathematics; one could take pure and applied maths together or separately. Many chose the latter option, which is an attractive way ahead.
Dr. Cable: I followed the same path as the hon. Gentleman; I remember it well, but I struggled with the more difficult maths. The key conceptual point that we have been asked to consider is that not all subjects are equal. The radical suggestion is that subjects should be valued differently for university admission.
The report makes some radical suggestions for creating what it calls centres of teacher excellence, costing £100 million or thereabouts. It builds on the existing model for science teaching, which at least in its early stages appears to be a well-conceived initiative. If people are being sharply party political, they might ask how it will be paid for. My answer would be that the Government spend an awful lot of money on trade and industry in industrial support and tax credits to encourage the private sector to do research and science that it would probably do anyway, and that diverting a small fraction of that sum into science and mathematics teaching would be a much more productive use of taxpayers' money.
2.21 pm
Mr. Robert Key: I congratulate the hon. Member for Twickenham (Dr. Cable) on his good fortune in acquiring today's debate, which is on an important subject The hon. Gentleman is a distinguished mathematician; he was a professor at Nottingham university.
Dr. Cable: Of economics.
Mr. Key: Indeed. None the less, the hon. Gentleman is a distinguished mathematician. However, I bet that he is glad that he is no longer the chief economist of Shell, which is clearly short of mathematicians.
In following the hon. Gentleman's excellent remarks about mathematics, I must tell the House that I, too, have read the essential chapter 2 of Professor Adrian Smith's report. However, I do not agree with his conclusion, which was endorsed by the hon. Gentleman, of using market forces, with golden hellos and other inducements. As a former teacher, I believe that teaching is a vocation.
I spent 16 years at the chalkface, and my experience was that differential pay rates for subjects or responsibilities—perhaps for games or certain other subjects—gave rise to all sorts of petty jealousy in the staff room. That was human nature. I recall that one of the headmasters under whom I served conducted a survey and discovered that more than 90 per cent. of the teaching staff were receiving some sort of special payment. We had round-table discussions about that,

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and we decided that it was unfair. We agreed to scrap nearly all the special payments and to increase all salaries by a sensible amount, which was much more motivating. The professor's suggestion is the equivalent of fiddling while Rome burns.
As a member of the Science and Technology Committee, I visited Culham last year. While going round a Particle Physics and Astronomy Research Council establishment, we met some brilliant teachers—except that they were not teachers. They were researchers, but they were so good at explaining the principles behind their advanced physics that I wished that they were working in the classroom and not at the cutting edge of science. That is one of the dilemmas facing those who care passionately about mathematics or science subjects; they are torn between the pursuit of academia or business and basic schooling and education.
One aspect of the subject has not yet been mentioned. I would like to know what the hon. Gentleman thinks of it, and the Minister may have something to say about it. I speak of the enormous scope in specialist science subjects and mathematics for distance learning and a greater use of the internet, which has become so much more sophisticated. The work of the Open university at undergraduate level suggests a huge potential for using the internet much earlier in the curriculum—let us say from the age of five.
I shall concentrate more on science. The day after tomorrow will be my birthday. I have always enjoyed birthdays. I wonder whether you, Mr. Deputy Speaker, remember the coelacanth. Fossils of that fish can be 400 million years old, predating dinosaurs by millions of years. A living specimen was caught off the coast of southern Africa in 1938, and another was hauled aboard a boat near Grahamstown in 1952, just in time for my seventh birthday. My father ordained that my birthday treat was to be coelacanth and chips all round, followed by my favourite BBC Home Service radio programme—there was no TV then of course—"Journey into Space".
Now, as then, most children of that age are excited, engaged and motivated by dinosaurs and space, and recent blockbuster movies and TV series on those themes prove my point. So why is it that most young talent deserts the world of the sciences when GCSEs and A-levels demand subject choices? The issue really matters and must be addressed if the United Kingdom is to make sound judgments on ethics and investment and to compete at the leading edge of world industry and wealth creation.
The quality of public debate about genetic modification, the sources, use and abuse of energy, therapeutic cloning, reproductive fertility and a host of other issues is truly abysmal. In the difficult world of science, self-serving pressure groups have become the refuge of politicians, journalists and voters alike.
Last December, the Science and Technology Committee took evidence on nanotechnology from Professor Sir Harry Kroto, the president of the Royal Society of Chemistry. I asked him whether the lack of people in science was down to the lack of science education, and he replied:
"Yes. I think it is the most dangerous thing we face at the present time is, the lack of science teachers of pre-16s. I think we have got a disaster of enormous proportions facing us. Of the
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number of physics teachers teaching pre-16s, 80% do not have a degree in physics and 50% do not have an A level in physics. If that is not staring a massive problem in the face in six years, I do not know what is."
Why does science lose its appeal after such a sparky embrace from our children? A glance at the website of the excellent Association for Science and Education at www.ase.org.uk reveals that science teachers are working their socks off to attract the best pupils. Is it just that science is hard and media studies are easy? That is true, but it is an insufficient excuse. That says something profound about the message that our science and maths teachers are able to pass on to pupils who they believe have the talent to move into science and mathematics at a higher level.
The Select Committee's report "Science Education from 14 to 19", which was endorsed by my hon. Friend the Member for Fareham (Mr. Hoban), a member of the Committee at that time, concluded:
"GCSE courses are overloaded with factual content, contain little contemporary science and have stultifying assessment arrangements. Coursework is boring and pointless. Teachers and students are frustrated by the lack of flexibility. Students lose any enthusiasm that they once had for science."
To add insult to injury, we also need at least 4,000 more technicians, given that practical science in schools depends on them. However, we will not recruit them unless their appalling pay and conditions are improved.
We need a serious five-point plan for science in schools. First, we should adopt a coherent approach to the current dysfunctional time scale for key stage strategies and examinations, which is much criticised by science teachers. Secondly, professional bodies continue to report a serious shortfall in qualified science teachers; the hon. Member for Twickenham referred to that. Reversing that trend should be a national priority, and there can surely be agreement on that across the political spectrum, and between employers and employees.
Next, we must sort out the plethora of standards for trainee teachers, newly qualified teachers, teachers passing the threshold, subject leaders and head teachers. Again, I disagree with the conclusions of Professor Adrian Smith's inquiry, which recommends that
"consideration be given to the introduction of new mathematics teacher certification schemes which award certification to teach mathematics only up to certain specified levels, eg Key Stage 3."
That is just adding to the plethora of suggestions that are neither appreciated nor approved of by those who try so hard to teach these subjects.
Fourthly, we need to recognise that science teachers need less pressure and fewer initiatives if we are not to stifle their passion for the subject. Passion for the subject is the key to raising standards in schools and attracting people to those subjects. Finally, without proper professional development opportunities for teachers, standards will not be raised. The future supply of scientists will be threatened and young people will live in ignorance of the world of science.
Those who make it through school to university and who can find a science department that is not being forced to close will encounter unsustainably low levels of clinical research. The first of two challenges is the dearth of experimental medicine—testing the validity and importance of new discoveries or treatments in patients or healthy volunteers. The second is the lack of large-scale clinical trials of all new forms of health care innovation.

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The Medical Research Council is now tackling that fact in partnership with the NHS and other funders, but it has many competitors for Treasury funds in the spending review process. I hope that the Minister will use all the power at his command to persuade the Treasury of the importance of that. We should all be backing him up and battling with the Treasury on that important national priority.
How seriously are the Government taking the crisis in science? In the Select Committee's recent scrutiny report on the Office of Science and Technology, which was published on 4 March, we expressed deep concern that the Science Minister is not fighting the corner of science and research at the Department for Education and Skills. There has also been poor integration of the OST's activity with that of the rest of Government—the Treasury and the DFES in particular.
Last year there were six reviews of science and research policy in government. All were conceived separately and without reference to each other. As the Chairman of the Select Committee said,
"The Government wants a knowledge-driven economy but all we get is a review-driven Government."
That will not do.
The problem is appreciated across the spectrum. Not long ago, Baroness Susan Greenfield invited some of us to a Royal Institution evening meeting on science education. Present were some 15 blue-chip chief executive officers, academics and politicians, to discuss what was wrong with science education. I thought that they would all come up with the answer that the problem was lack of postgraduate opportunity, lack of research facilities, lack of funding for PhDs and so on. Not a bit of it.
Whether it was the CEO of a big company like Siemens or the vice-chancellor of a university, the same conclusion was reached: what was wrong with British science was a lack of teaching in primary schools, and if we do not grasp the nettle of primary school teaching and take the long-term view—something that politicians are not normally credited with doing—we will do our country a disservice in the long run.
We all have little anecdotes about why we have suddenly become convinced on an issue. I was at a reception on the Terrace last summer for the brightest and best of our graduate scientists, who presumably all at least had first-class honours degrees, and some of whom probably had second degrees. I chatted away to three of those attractive, bright young people about—although I am not a mathematician—the measurement of things. They talked about the latest supercomputers and so on. I quietly asked if they had all used slide rules. They had all heard of them, but none had used one. Two of them had heard of log tables; none knew how they worked. Only one out of three had even heard of an abacus. I may be very old-fashioned and my birthday may be approaching rapidly, but I am happy about supercomputers, and believe very much in looking forwards, not back. However, it is perfectly clear to me, at the ripe old age of 58, pushing 59, that if we do not deal with the problem soon, we shall be letting down a whole generation of young people in this country.
2.34 pm
Mr. Tony McWalter: This afternoon I had intended not to speak but to listen to the wise words of others, in the expectation that the Liberal Democrats would have arranged for a rank of speakers to address us during the hour and a half of the debate. However, in the absence of any other speaker, I would hate there to be no contribution from the Labour Back Benches.
It is a pleasure to follow the hon. Member for Salisbury (Mr. Key), whose commitment and enthusiasm in this area are legendary, and I would like to reflect on some matters that he raised. I disagree with him on what is to be done about the Smith committee recommendation that thought should be given to differentials in teachers' remuneration. Like the report's other 43 recommendations, it should be taken very seriously.
We are considering a culture in which it is assumed not that all animals are equal but that all subjects are equal. However, some subjects connect with the human psyche differently from those with which we become familiar as young children; subjects such as mathematics make demands on our brains that others do not. I speak as one who undertook a mathematics degree but then realised, perhaps like the hon. Gentleman who opened the debate—let us call him the hon. Member for Teddington—that there are much easier ways to earn a living.
It is hard to put it over to people not only how difficult maths can be but how extraordinarily it can develop one's personality and understanding. We should consider what motivates students. I am the father of three children, the eldest of whom is at university studying American studies for the good reason that his degree course involves his spending a year in America. It was a wise choice, and I had an interesting discussion with him over Easter about which American university he would like to go to. The question of what job he will do has not arisen, but I suspect that there will be a significant market in this country for people with a considerable understanding of American history, culture, art and so on. In any event, such subjects are clearly tremendously attractive.
My daughters, aged 12 and nine, are both pretty good at maths, but I should be surprised if they went on to study it in depth. It is my pleasure to take them on a Saturday morning to an organisation called Theatre Train, where they sing, dance, act and have a wonderful time. If someone were to ask them to compare that pleasure, and the prospect of doing those things as fledgling adults and then as young adults, with doing a lot more of what they do in their maths classes at school, I have little doubt about what their answer would be.
It is extremely difficult to get an idea of how pleasurable mathematics can be. We have a system under which people are treated as though gaining a degree will qualify them for jobs in the City and elsewhere. So long as all subjects are equal, those that look more taxing will lose out. The stronger the range of subjects and the more exciting the opportunities—such as going to America, studying Burmese history or doing any of the other wonderful things that can now be done in education—the more they connect with people's motivations to study. It becomes progressively more

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difficult for people to understand that there is another world beyond, of which they have little concept or experience.
David Taylor: It is difficult for those with a lifetime's love of mathematics, such as me, to understand why others do not share that affection and enjoyment. Does my hon. Friend agree with one of Professor Smith's other conclusions—that there is great potential for promoting mathematics through, for example, a national centre of excellence, regional centres of excellence and perhaps even local centres? That could encourage young people in the belief that there is huge enjoyment not in log tables and abacuses, but in modern mathematics.
Mr. McWalter: I am grateful to my hon. Friend. I sign up not only to the recommendations at the end of the report that he mentions, but to all of it. We could grab this problem by the scruff of the neck and do something about changing the culture. My children tell me that the current term is nerds—people who have an extraordinary interest in things that are deeply remote from the set of "EastEnders"—but nerds and nerdish concerns are increasingly marginalised in our education system. I am sometimes thought of as rather nerdish myself; yesterday, I had the opportunity to say some words to the parliamentary Labour party that were regarded as sufficiently abstract as to cause mirth.
We must find a way of getting people to understand that "education" is in many ways a misnomer. The word "educari"—to lead out from somebody their potential for learning—is only part of the process of education. Hon. Members may know that it comes from the model in "The Meno", one of Plato's dialogues, which portrays a slave boy with the potential to have an understanding of geometrical form led out from him. In truth, education is about not only pulling out from somebody what they are interested in and what they think, but getting them to understand the world—not just the material world, but the world of ideas and beliefs—and the powerful intellectual forces that have shaped the world we have inherited.
Mathematics is a powerful part of that, yet that side of the subject is often entirely ignored in what we call mathematical education. I share an enthusiasm with my hon. Friend the Member for North-West Leicestershire (David Taylor)—for such things as seeing scratched on a piece of paper six symbols associated with Gauss, ei = -1.
David Taylor: That's right.
Mr. McWalter: My hon. Friend knows the power of those symbols. That idea—one could have the exponential number, 2.78 et cetera, raised to the power of pi, which is the extraordinary number that reflects the ratio of the circumference of a circle to its diameter, and then multiplied by the square root of minus one, which somehow could equal minus one—is extraordinary. However, most people, if they looked at that series of symbols on a page, would just turn off and say, "What's that all about?" In my view, it is one of the most extraordinary achievements in the history of mathematics.
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On the one hand we have a phenomenal achievement and on the other a complete absence of consciousness on the part of even the most educated people of what that achievement really means. As I have described it, of course, it is just a series of symbols. However, let me take only one portion of that idea of Gauss—the idea of the exponential number. That number plays a significant role, for instance, in understanding the processes of radioactive decay. The equation for radioactive decay involves that exponential function.
If one is to understand how radioactive particles decay or how we deal with radiation rising from natural or unnatural processes, it is a pretty good idea to have some grasp of the concept and to understand the equation governing the process. However, most people in this country have not a clue what the exponential function is. As a result, they cannot engage in debate on or claim to have an understanding of the process of radioactive decay. Again, we come to the idea that understanding how natural processes are to be quantified is hugely difficult for most of us to take on.
The hon. Member for Salisbury—I sometimes accidentally call him my hon. Friend, and perhaps I should do that—talked about some reports of the Science and Technology Committee. We have a report, not yet finalised, that deals with issues involving how we go about trying to help with acting on the agenda of the Johannesburg summit, where there was a particular emphasis on the need to get an effective water supply to some of the poorest countries in the world.
One of the issues that came up when we spoke to the chairman or chief executive—I cannot remember his precise title—of the Natural Environment Research Council was the fact that people had taken that agenda on board and sought to act on it, which is great. People want to drill wells to service the needs of villages in some of the poorest places in the world, but with no quantification and no thought given to the fact that if they drill at point A they might give people a water supply for 100 years, but if they drill at point B they might give people a water supply for six months.
Quantification, understanding the processes and working out the shapes, geology and the porousness of rocks are all mathematical processes, some of them governed by the same exponential function that I talked about. However, if people went into such things with good will and mathematical ignorance, they could do more damage than if they tried to do nothing at all. Mathematics is part of education and of action—it does not involve only referring back to a beautiful equation of the late 18th century—which gives us the power to understand how the world is and how we can influence and change it for the better.
David Taylor: Is not mathematics also important in politics? If Ministers in successive Governments had been more numerate, perhaps we would not have landed ourselves with the public relations disaster of an education grant settlement that left some schools less well funded than they were and with a private finance initiative that is prohibitive in cost, flawed in concept and intolerable in consequence, all of which could have been calculated and predicted merely by considering the

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mathematics of the enterprise. Should we not be looking for improved numeracy and mathematical skills at high levels of government?
Mr. Deputy Speaker (Mr. Edward O'Hara): Order. It is fascinating to hear about the importance of mathematical concepts and their applications, but I remind hon. Members that we are talking about the supply of mathematics and science teachers.
Mr. McWalter: I am grateful to you for your guidance, Mr. Deputy Speaker. I strayed slightly, but I was trying to emphasise that we must give people an understanding of mathematics as a power to change the world for the good. Most young people whom I have met want to do things with their lives that will enhance the lives of others, so if people had that idea of mathematics and science we might begin to change motives. To do that, however, we must give people a motive to work through difficult or unnatural concepts.
It took 1,500 years for people to gain an understanding of how to begin to come up with a set of numbers that might describe the flow of liquids. None of those things is natural; they are huge achievements by our culture. We cannot just assume that now we have a way to produce some of those numbers, they will easily be latched on to by the average pupil aged 13 or even 23. Those cultural achievements are monumental and to change our world for the better we must find a way to communicate them and to empower people who have become the reliquaries of those achievements. If we could give people a much more positive sense of those things, we might not face shortfalls in teacher numbers such as some of those we face currently.
Mr. Key: I want to return for a moment to the example of the hon. Gentleman's family, as my younger daughter did exactly what his child is doing. She took an American studies course and went to the university of Texas, where her mind was broadened enormously, not least to the wealth of American universities and the money spent on science and maths education in such places. I want to give the hon. Gentleman some hope, following what he has said about doing the world some good. Would he care to comment on the fact that my late father studied mathematics at Cambridge and ended up a bishop?
Mr. McWalter: I cannot claim that studying mathematics always leads people to be useful to society; it simply gives them capacities that they may decide to implement. Of course I think that bishops do a good job as well; perish the thought that I would say otherwise.
I look forward to the Minister's reply to the debate. Obviously, I want to hear that he and the Department have taken the issue on board and will achieve a sea change in how we think of these matters. That would be immensely to the good of our children and their children. If we can begin to ensure that those capacities are cosseted and improved, we can enjoy the prospect of continuing to live in a successful country that not only innovates scientifically, but uses those ideas in powerful ways to improve our world.
2.55 pm
Mrs. Annette L. Brooke: I congratulate my hon. Friend the Member for Twickenham (Dr. Cable) on securing this timely debate. I had perhaps not anticipated the direction that it would take, but it has been of great interest. I intend to concentrate on the title, but, funnily enough, something flashed into my mind as the hon. Member for Hemel Hempstead (Mr. McWalter) was speaking. I recall that when I was studying for my maths A-level, which I loved and worked on at all hours, I strayed and read something that Bertrand Russell had written. He wrote that as a young man the only thing that stopped him committing suicide was his love of mathematics. I found that inspiring as an A-level student. However, I return to the topic.
We can quote all sorts of statistics. For instance, more than a quarter of secondary school maths lessons are even now taught by teachers without relevant post A-level qualifications. As has been said, we can go round and round, arguing whether the problem is to do with our uninterested pupils or a lack of inspirational teachers. An article in The Independent on 19 February succinctly illustrated the vicious circle that we face with two equations, which I rather liked. It said that
"unqualified maths teachers + uninterested students = a drop in the number of people taking A-level maths",
and
"fewer maths undergraduates = fewer qualified teachers."
I would add my own comment, albeit on a slightly different tack. The highest level of academic qualifications does not necessarily equal the highest level of teaching ability. We should bear that in my mind. I am sympathetic to Professor Smith's idea about mathematical qualifications at different levels. The inspiration that is needed at the primary school level may or may not come from people with PhDs in mathematics. I would not make a presumption in either direction.
My underlying premise is that all our children have a right to be taught by a teacher who is not only qualified, but qualified in the subject or area being taught. Equally, teachers have a right to professional development. They need to enhance expertise or subject knowledge. I find it scandalous that the most recent secondary schools curriculum and staffing survey took place after a six-year interval. Prior to 1966, such surveys were conducted at four-year intervals. Concern about the shortage of subject specialists is not new. If there is to be a timely, planned response. it is essential that decision making is based on the most up-to-date information and that clear responses are made to identify trends.
Professor Smith commented on that deficiency. He said that he regretted the fact that only preliminary findings on qualifications and age profile were available to him when he was working on his report. How can vital targets for teacher training be set without sound information, collected regularly? I understand that the most recent data are made up of responses from only about 200 schools, which account for fewer than 25 per cent. of those asked to participate.
We have heard reference throughout the debate to two important reports, one by Sir Gareth Roberts, primarily on science but covering other subjects too, and

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another more recent one by Professor Smith. It is interesting that although they at times approached the problem from slightly different angles, they reached similar conclusions. That is certainly true of their views on centres of excellence, although the formats were slightly different. Both reports say that we seem to have an ageing population of science and mathematics teachers—I presume that the hon. Member for Salisbury (Mr. Key) was a science teacher.
Mr. Key: No.
Mrs. Brooke: I apologise.
The point has also been made that school children are not finding science or mathematics exciting. I agree with other hon. Members that it seems nonsense in this day and age that science is not exciting. With the pace of change and exciting developments, how can children be bored by science? We should question what is happening in our schools. I personally have always had a great love of mathematics, and I am not sure how we have managed to turn children off the subject.
It emerges from the findings of both the reports that we compare unfavourably with other countries in both science and mathematics. The curriculum content is vital. We heard from Professor Smith about the fiasco in 2001, which had a particularly bad effect on mathematics. It was bad that such a large number of students failed, particularly as they had already had a bad time with the AS-level. As far as mathematics is concerned, Professor Smith's recommendations to change GCSEs are quite exciting. The possibility of the double qualification that would emerge from those changes would be worth considering. There is a lot of scope for change in that area.
My hon. Friend the Member for Twickenham referred to mathematical literacy, which we all see as important. It is a basic life skill. I recall an incident in my local authority area. The weeds were growing at a great pace in the pavements, and a new EU regulation required those who were to apply the weedkiller to have a paper qualification. There was great difficulty in getting the workers through that qualification because they needed to know the proportions. If people can do such things instinctively but cannot translate them on to paper, it is nonsense that they should be required to do so. We should ask questions about our approach.
It is difficult to know how severe the shortage of teachers is. One of the surveys found that many of those teaching mathematics did not have a post A-level qualification in mathematics. However, many of those teachers may have had a degree similar to mathematics, which would mean that they would be adequately qualified. They might, for example, have a degree in physics or in economics. I have a degree in economics, and would consider myself qualified to teach up to key stage 3, although it would be helpful if I had continual development and courses to keep me up to date. We must think outside the box, and perhaps work on the fact that there are people available with degrees with a high level of mathematical content.
Mr. Key: The hon. Lady has just made a profound point. Professor Smith also pointed out in his report that
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25 per cent. of mathematicians teaching in schools are not teaching mathematics, which is a huge untapped resource. Like her, I was an economics teacher.
Mrs. Brooke: I was going to refer later to the matter raised by the hon. Gentleman, but I shall do so now. I do not think that we need to worry about it too much, although research probably needs to be carried out. I know of a secondary school mathematics teacher who did not feel supported in dealing with behavioural problems in their school. The teacher then moved into a middle school and is now making an enormous contribution, not as a specialist mathematics teacher, but teaching mathematics, heading IT, and doing many other things with their skills—[Interruption.] I would give way under normal circumstances, because I enjoy talking about this subject, but I am really short of time.
Many people have identified the problems; we must now explore solutions and ensure that those solutions are the right ones. Top of my list—perhaps because of my teaching background—would be valuing teachers in general. Running teachers down and making false criticisms of them does nothing at all for the profession. I was unhappy about the recent statement made by the Secretary of State for Education to the General Teaching Council. He is quoted as saying:
"It is almost hit and miss whether your classroom teacher is working rigorously and systematically to improve the classroom experience for every child."
That statement worried me in many ways, not least because it is damning of the teaching profession. I found some of Chris Woodhead's comments damning of the profession in general and not necessarily reflecting the experiences to which I could relate. If we want enthusiasm and teachers to give 300 per cent.—I think most of them give more than 100 per cent. now—we need to support them and provide training opportunities.
We have also to consider why teachers are leaving the profession, as the lack of retention is affecting the supply of teachers. A recent survey by the university of East Anglia reveals why new teachers choose to stay or leave. Administration and red tape was cited by 88 per cent. of trainees as what they liked least about teaching, and it certainly does not help inspirational teaching. Poor pupil behaviour is also mentioned and, although I am in favour of inclusion, it should also involve plenty of support, which is often lacking in schools. We know that the work load is too high, and I wonder whether the resources will exist for work-load reform. Currently, about 40 per cent. of trainees leave the profession within three years. Other studies talk about the degree of stress that teachers feel. We have to address all those issues in the wider sphere of teaching as well as homing in on particular subjects.
We could be much more innovative with continuous training and development. I have mentioned the idea of those without pure mathematics or pure science degrees having enhanced training, and that should take place in school or paid time. Will the Minister consider something like a mini-SCITT—school-centred initial teacher training—scheme, in which someone with a degree has to do only three months to bring them up to the required level? We need to consider that, and I endorse what Professor Smith said. Many qualifications could be considered, but the system would have to be simple.

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Monetary incentives have been suggested, and I agree about salary differentials. If we are talking about higher salaries, they should be for all teachers. If they attract more teachers, it will be all to the good because there will be more choice and higher quality teachers in other subjects. At the moment, schools in some parts of the country have barely any choice after advertising a maths job. They are lucky if anyone applies, certainly in my part of the country. where house prices are high. That is true for other subjects as well.
The economics argument, which I had thought that my hon. Friend the Member for Twickenham might mention, is that we would be giving someone an economic surplus if we paid them more that we needed to attract them, but there is an overwhelming argument for increasing salaries generally for teachers. That will drive up the number of people applying for each job, and market forces could work effectively. I know from experience that having different salaries for the same job in a school leads to a lot of differentials and unhappiness.
We could also think of other ways to improve teacher recruitment. In the last general election manifesto—that is not to say that it will be in the next one—the Liberal Democrats proposed the policy of improving teacher recruitment by paying trainee teachers a full pro-rata salary during their training year. There are many points to consider, including parity for students on the four-year courses and degrees and education qualifications going together, but the idea of training salaries ties in with Professor Smith's thoughts about using the physics and mathematics students in the classroom and paying them. A lot of work could be done on that.
Overall, we are talking about the importance of getting it right at all ages. The emphasis on primary education has to be the most important because there is no chance of stimulating and interesting children if we have not captured them early. We need to appreciate that, although we need the highest level of mathematical skills, we also need basic skills for so many jobs. People cannot take on today's jobs without the fundamental mathematical numeracy and literacy skills.
This has been an important debate. There are many questions for the Minister to answer, and he has a challenge. He must do something about this very big problem.
3.10 pm
Mr. Mark Hoban: I, too, congratulate the hon. Member for Twickenham (Dr. Cable) on securing the debate, and on his lucid introduction in which he set out some of the important issues that Professor Smith and others have raised about the teaching of mathematics and the shortage of maths and science teachers.
As we are all displaying our mathematical qualifications, or lack of them, in today's debate, I must say that I, too, have an economics degree, although I confess that I did the least possible number of mathematical options available to me at the London School of Economics. So unlike the hon. Member for Mid-Dorset and North Poole (Mrs. Brooke), I may not be considered suitable to teach up to key stage 3 in class.
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The hon. Member for Twickenham was right to highlight the vicious circle of events that stem from the shortage of maths and science teachers, the poor quality teaching that our pupils will receive, the fact that GSCEs may not enable our pupils to realise their full potential, and the fact that fewer pupils will do A-levels and degrees, which will lead to fewer teachers and restart the whole cycle. He was also right to highlight the importance of numerical literacy to the wider economy. I, too, noted the article and the comments about the need for the mathematical training of nursing staff and those working on a range of topics, such as water exploration, which the hon. Member for Hemel Hempstead (Mr. McWalter) mentioned very appropriately. The hon. Member for North-West Leicestershire (David Taylor) was right to point out the need for numerical accuracy among politicians. He and I are two of the very few accountants in the House, so I have some sympathy with that point, although I may not agree with some of the contexts that he mentioned.
My hon. Friend the Member for Salisbury (Mr. Key) is certainly not a dinosaur, despite his approaching birthday. He is a lively specimen, and he was right to call for the simplification of the maths and science curriculum. When the hon. Member for Hemel Hempstead and I served on the Science and Technology Committee, it was clear to me that schools were faced with an overburdened curriculum and that young people lacked the time to study some of the more exciting but sadly neglected aspects of science, leading to a shortage of maths and science teachers in later years.
The hon. Gentleman reminded me of those days on the Select Committee when he vociferously pointed out the cultural reasons for the decline in the take-up of maths and science degrees. If we are to address the shortage of graduates and the consequent shortage of maths and science teachers, we must recognise that the cultural aspect is as important as the detailed recommendations of the Smith report.
It is clear from the figures that there is a shortage of maths teachers. In the 2003 teacher vacancy tables, out of 16 subjects, maths had the third highest vacancy rate of any subject and science had the eighth highest. The vacancy rates in maths and science have trebled since 1997, although they have declined significantly since 2001, when they peaked.
The number of non-degree specialists teaching maths is a problem. Some 52 per cent. of maths lessons are taught by those who have a maths degree. The situation in science is better: a high proportion of people who teach science have a science degree. From the work done by the Select Committee, however, I am well aware that there are people with biology degrees teaching physics and chemistry as well as biology in the double science award. It became very apparent during that investigation that a love of one's subject is important in passing on knowledge and information to students. If someone has a biology degree, they cannot pass on to their pupils the same love of physics and chemistry as they have of biology.
The hon. Member for Twickenham was right to highlight the fact that science teachers are older than other teachers. The age profile of maths teachers has deteriorated since 1996 and the previous census of teachers.

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Given the shortage of maths teachers, what are schools doing? Part of their solution is to use non-specialists to teach, which is a problem for communicating knowledge and encouraging people to do more detailed work in maths and attain higher qualifications. The table in the Smith report which caught my eye dealt with what schools are doing to fill the vacancies for maths teachers. The report stated that 56 per cent. of vacancies were filled by either good or satisfactory appointments. In almost 11 per cent. of cases, the appointee needed support, and in just under 11 per cent. of cases, the appointee was unsatisfactory—head teachers are forced to appoint staff that they believe to be unsatisfactory to fill important maths vacancies. In 21 per cent. of cases, staff were moved to fill a vacancy for a maths teacher and no appointment was made. I suspect that those were non-specialists moving to teach maths, which is another worrying factor.
The problem goes deeper than that. There has been a recent improvement in recruiting maths teachers but there is still a disappointing failure to convert applicants for postgraduate certificate of education courses in maths into accepted trainees. The conversion rate for maths is well below that for subjects such as design and technology and religious education. The level of qualification for those being brought in to teach maths also causes concern. The Smith report states that the proportion of trainee teachers with a 2:1 and above has remained broadly constant—between 33 and 38 per cent. of the total intake. However, a lower proportion of the best graduates go into teaching maths than into IT, modern foreign languages, science, PE, geography, RE, history and English.
Why do maths and science graduates not go into teaching? In his presidential address to the Association for Science Education, Sir Peter Williams highlighted relatively low pay compared with other professions as a reason. However, the National Union of Teachers pointed out that there are other aspects, such as discipline in classrooms, to which the hon. Member for Mid-Dorset and North Poole referred. Further reasons include the continued interference in what goes on in the classroom through Government initiatives and the high work load that teachers experience.
There is no consensus on the question whether to recruit more maths and science teachers by increasing pay. Dr. John Dunford, the general secretary of the Secondary Heads Association, argued against that when the Smith report was published, although I must say that the NUT recognises that part of the reason for the shortage of maths teachers is the difference in pay rates compared with the outside world. We need consensus among teachers unions before politicians have to reach consensus.
The Smith report raised important issues about methods of increasing recruitment, but the problem also lies in the retention of teachers—it is a matter not only of getting teachers through the door and on to the training course, but of ensuring that they remain in the profession. Important changes have to be made on discipline, and to the work load and the wave of initiatives. That would make the job of teaching more attractive and encourage people to remain in the profession. The Minister has many questions to answer, one of which is when the Government will give their response to the Smith report.
3.19 pm
The Parliamentary Under-Secretary of State for Education and Skills (Mr. Stephen Twigg): I join other hon. Members in congratulating the hon. Member for Twickenham (Dr. Cable) on securing this important debate. We have had a thoughtful debate on both sides of the Chamber, and the issues have been fully aired. I pretty much concur with everything that has been said about the scale of the challenge that we face with science and mathematics in our schools. Since his appointment 18 months ago, my right hon. Friend the Secretary of State has sought to place much greater emphasis on subject specialism. I very much agree with the hon. Member for Salisbury (Mr. Key) that one thing that really enthuses teachers in their work is a passion for their subject. Whether that subject is science, mathematics or from another part of the curriculum, colleagues on both sides of the Chamber will welcome the greater focus on subject specialism.
Although I am responding to the debate, the importance of science and mathematics is demonstrated by the fact that my right hon. Friend has taken direct responsibility for leading our work in the DFES on mathematics and science. I tread with care in responding to the debate, because I am, I think, the only non-mathematician, non-economist and non-accountant in the debate. Indeed, I must confess that I gave up my maths A-level after a year. I decided to do pure maths and managed to get an additional O-level in it, but I was persuaded by my economics teacher to focus on applying to do philosophy, politics and economics at Oxford rather than on doing my fourth A-level in mathematics. I regret that because, like other hon. Members, I found mathematics exciting at school.
I have a short time in which to respond, and if I do not manage to take up all the points that have been raised, I shall write to hon. Members. In opening the debate, the hon. Member for Twickenham noted that it was timely, given the recent publication of the Smith report. He rightly emphasised the educational and economic importance of the focus on mathematics and science.
The hon. Gentleman raised the interesting issue of mathematical literacy. That is one of the issues that we must address in the maths curriculum, but it is also linked to other parts of the curriculum, such as personal and social health education and citizenship, as well as to questions of financial literacy. He gave the example of compound interest, and there are many other positive examples. He also emphasised the scale of the challenge that we face, and I in no way underestimate it. Towards the end of my speech, I shall say a bit more about that.
The hon. Member for Salisbury made an interesting speech. He started by making a powerful case against market forces, which was interesting. It was also interesting to hear my hon. Friends and, indeed, the Liberal Democrats make the case for market forces. We live in interesting times. However, the hon. Gentleman also made an important point about distance learning and about the opportunities that new technology gives us to share good practice between schools and colleges, and possibly internationally—a point that I would like to take away with me.
The hon. Gentleman set out a five-point plan, which I would like to consider after the debate. I undertake to come back to him about it.

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Perhaps the hon. Gentleman's most important point was about the critical importance of getting our approach right in primary schools. Almost a year ago, we published our primary strategy document "Excellence and Enjoyment", which seeks not only to reaffirm the central importance of literacy and numeracy in our primary schools but to celebrate the broader curriculum. The science element of that broader curriculum is critical to getting things right.
That brings me to my hon. Friend the Member for Hemel Hempstead (Mr. McWalter), who challenged us to make science and maths attractive not only to nerds—his expression, not mine. He is right. As he said, there is a notion that all subjects should be treated equally, and there is a really tough balance for us to strike. As the Minister with responsibility for primary schools, I am used to the opposite criticism—that we put too much focus on numeracy and literacy. People ask, "What about the rest of the curriculum?" We must all think about how to advance the basics—I would include science along with literacy and numeracy—in the context of the broader, richer curriculum. I see no reason why we cannot achieve that, but I very much accept, for all the reasons that have been set out in the debate, that we are nowhere near doing so at this stage.
My hon. Friend made a powerful, emotional case for seeing maths as a force for good in the broader social and economic context. That is one way in which we can start to address the question of how to make such subjects more attractive to children and young people of all ages.
I want to share a few statistics with hon. Members. I do not like to fill my speeches with statistics, but a few have been mentioned, and it is only fair that I give some of the good news to balance the perfectly reasonable points that were made earlier. Good progress is being made with the number of children who leave primary school having achieved the expected level, or better, in mathematics at age 11. It is still not good enough, but 73 per cent. of pupils achieve level 4 or better at age 11, which is a 14 percentage point improvement since 1998. That investment in, and support for, numeracy skills at the youngest possible age is very important, as several colleagues have pointed out.
At key stage 3, last year. 71 per cent. of pupils achieved level 5 or better—up four points from the previous year. At GCSE—to correct the hon. Member for Twickenham, who quoted a figure of 43 per cent.— I understand that the latest figure is that 48 per cent. of pupils achieved grades of A* to C. I accept that those figures are not good enough, but they represent progress in the number of 15 and 16-year-olds achieving the level that we would all expect them to reach in mathematics.
I will say a few words about teacher training and recruitment before I finish by talking about the Smith report and taking up the challenge of the hon. Member for Fareham (Mr. Hoban) about the Government's
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response to that. There are some encouraging signs, which have been referred to by Members on both sides of the Chamber, that the position of teacher vacancies generally, and specifically in science and mathematics, is improving. I accept that we still have a long way to go to make it right, but vacancy rates in science and mathematics teaching have fallen.
In initial teacher training, the position that we inherited in 1997 was that there had been a decline in recruitment. We have sought to put much more emphasis on recruiting people into teacher training generally, and particularly in shortage subjects. There has been a large increase in those going into initial teacher training and specialising in maths—about a 50 per cent. rise in just four years. There has been a more modest improvement with science places, with a 20 per cent. rise over the comparable period. It is a big challenge, as hon. Members have said, but we are at least beginning to meet that challenge with support for, and investment in, initial teacher training.
There are also employment-based routes into teaching, and there have been significant increases in the numbers going into teaching through routes such as the graduate teacher programme—again, with particular focus on mathematics and science. I am sure that that will be welcomed.
We have also created a number of incentives for maths and science teachers, several of which were mentioned during the debate—golden hellos, for example—so I will not go into them again. We are looking at ways in which we can assist with student debt for graduates who go in to teaching shortage subjects such as mathematics and science. That is of critical importance. Finally, we have the undergraduate ambassador scheme, which operates alongside the student associate scheme to enable students to get degree credit for their classroom activities in line with what Professor Smith was talking about, and upon which we have the opportunity to build. That scheme aims to recruit about 1,000 maths and physics students by 2005–06.
There has been progress, but I accept that we still have some way to go to get it completely right. We now have Professor Smith's report "Making Mathematics Count," which we welcome, as do all Members in the debate. We, as a Department, are taking it seriously and are actively considering all 44 of its recommendations, particularly how best to take those recommendations forward with key stakeholders, including subject specialist associations, and in the context of the work of Mike Tomlinson's group on 14-to-19 reform.
If we are to learn all the lessons to which hon. Members have referred, it is vital that we introduce a set of changes that can be sustained long term, so that we can ensure that maths and science are attractive subjects in our schools, and that we are able to recruit and retain the highest quality maths and science teachers for the future. I welcome the contribution that today's debate has made to taking that forward.

European School, Culham
3.30 pm
Mr. David Cameron: I am delighted to have this opportunity to speak about an excellent school. The debate is very much a two-handed affair: the European school at Culham is in the constituency of my hon. Friend the Member for Henley (Mr. Johnson), but is attended by the children of a number of my constituents in west Oxfordshire and of constituents throughout Oxfordshire. My hon. Friend and I had a pact to apply for an Adjournment debate in the hope that one of us would be successful, and it fell to me. We want to put on record the role of this school and our concerns about its future, and we want some quality time with the Minister, whom I am glad to see in her place.
A lot of debates in Westminster Hall bring forward problems, but we like to think that we are bringing forward an opportunity for Oxfordshire and the country at large. Culham is an excellent school—a little gem. All we are asking is that everyone who has a stake in the school—the local education authority, the European Commission, the Government and the teachers, parents and board of governors—play a constructive role in trying to secure its future. That is what today's debate is about: an invitation to the Minister to consider the school and to do what she can to help.
Let me rewind and put on record some facts about the European school at Culham: what it is, what it does, who goes there, why it is facing some difficulties, why it is worth keeping, what needs to be done about it and how the Minister can help. My hon. Friend the Member for Henley will then bring it all to life in his inimitable way, as he is himself the product of a European school. He spent some of his formative years at one in Brussels, which goes to show that although such schools have a European ethos, the children can develop into Europeans in the broadest possible sense of the word.
The network of European schools around the European Union was first set up some 50 years ago for the children of those working for European institutions. There are 12 of them, and Culham was opened in 1978. They teach in many different European languages and specifically teach the European baccalaureate. The European school at Culham serves 900 pupils. Some 40 per cent. of them are British or of mixed British and other EU nationalities, and the rest come from other EU countries. The school has five language sections: French, English, German, Dutch and Italian. Danish, Irish and Spanish are also taught.
There are three different types of pupil. First, there are the children of those who work for European institutions, who at Culham tend to be the children of scientists and others working at the Fusion project at Culham. They account for about 5 per cent. of the total, including the children of teachers. They are category 1 pupils, and pay no fees. Secondly, there are the children of parents working for other continental European companies or organisations that contract with the school. BMW, for example, which is now booming in Oxford and producing the very fashionable Minis that race around our roads, has an agreement with the school. These are category 2 pupils and the agreements
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cover the costs of the places that they take so, again, no fees change hands. Thirdly, there are the children whose parents are attracted to the school and its ethos, its emphasis on language and its good record. Those parents pay fees, which are low compared with those of most private schools.
Currently, the fees are some £1,500 for primary pupils and £2,500 for secondary pupils. Rises of 20 per cent. or more are planned for the next two years, but the Minister will agree that those are very low figures, which make the school accessible for many parents in Oxfordshire. However, costs at the school are high because of the structures that it needs, such as teachers of all the language sections. The cumbersome and top-heavy structure leaves some room for cost-cutting, which I shall come on to.
The facilities at the school are not particularly special or privileged. I have been to the school and looked at the buildings, and there is nothing particularly magnificent about them. The school has an ethos as a state school. It is, as it were, a European state school, open for all. Crucially, the results are excellent. In most years, everyone obtains the European baccalaureate, and the EB is testing. Another indication of results is that pupils get into good universities, at which they tend to do well in lots of different subjects, not just languages.
The school is important to Oxfordshire, and all the Oxfordshire MPs have met and discussed it. It makes it possible to attract and retain highly qualified individuals in industry, research and the universities who might not otherwise come to Oxfordshire. It therefore provides a significant contribution to the economy of Oxfordshire and the UK. In Oxfordshire, there is the United Kingdom Atomic Energy Authority at Harwell, the Rutherford Appleton Laboratory and the Culham JET—Joint European Torus—project, and many other science-based and start-up businesses in my constituency have grown out of Oxford university. They value such schools, which will provide them with the scientists and bright people of the future, as well as places for their children to go to school.
I have recounted what the school is, who goes to it and what it does, but I now want to explain why it is in some difficulties. Funding is fairly standard across all the European schools. More than 50 per cent. comes from the European Commission, and the rest comes from the UK Government and other EU member states. In addition, as I said, there is funding from the contract partners such as BMW and the parents.
The funding problem comes from the fact that the European Commission wants to reduce its funding. That is not, I admit, unreasonable, as the employees of the European institutions make up quite a small proportion of the total. Also, as the EU enlarges, it will not be possible to set up such schools everywhere. The expense of all the different language sections that would be required to ensure that schools covered all the new nations of the EU would be very great.
The European Commission has, however, also proposed to exclude pupils whose parents do not work for the Commission or the diplomatic service, to eliminate certain language sections and to increase fees. Those latest proposals are exacerbating the problem. They threaten schools such as Culham with

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strangulation at a time when they desperately need a breathing space to find a solution. The briefing note that the parents have helpfully drawn up for us states:
"Hasty action would destroy the school".
I hope that the Minister will think about that.
What is the answer, and what do we ask for today? The answer flows from the fact that the school is a good one, and worth saving. All of us who want excellence in schools, want languages to be well taught in them and want choice in provision should want the school to survive and thrive, not only to provide the benefits to Oxfordshire that I spoke of, but for the broader economy and our education system.
The answer lies in all those with an interest in the school straining every sinew to find an answer. Those with an interest include the European companies that employ people locally; the development agencies that would like to attract more such companies to our shores and to south-east England; the science, research and development facilities of the Oxfordshire region—particularly taking into account the likely expansion around Rutherford and Harwell—and the European Commission, which retains a responsibility to the schools and must see them right. The list continues with the local education authority, which could and should, in my view, work with Culham as a language school. The authority could benefit hugely, as could the Government, who already provide some funding, because of the way in which the teachers are funded, and who apparently have a desire, which I share, for a blossoming of choice in our education system.
We want the Minister, first, to oppose any hasty moves in Brussels to change things—in particular to ramp up fees, reduce the number of sections or restrict access. We need to make sure that there is breathing space. That is the key phrase in today's debate. Secondly, we want the Government to vote in favour of a period of gradual transition, to give the school the chance that it needs to draw up its own business plan and to succeed. Thirdly, we want the Minister, who is, I know, very busy, and her officials to work with the school and the other partners to try to find a solution.
I admit that I, in my modest office at Westminster, do not have the solution at my fingertips. However, would it be too hard to imagine something along the following lines? I am thinking of a school that specialises in languages, that still receives some money from the Commission for the work that it does with the European institutions and that has special arrangements with businesses that want to fund it, such as BMW, but which is part of the mainstream British education system, with a mix of pupils. Is it hard to imagine some of those pupils being funded by the LEA, some paying fees and some having scholarships? That is the sort of mixed system that we should be looking for in this country. The European schools, and particularly the one at Culham, provide an opportunity in that respect.
What I have outlined may not be neat and tidy. It may require a lot of work and quite a bit of planning. However, our message to the Minister today is that it would be well worth making the effort. I look forward to hearing what she has to say.
3.39 pm
Mr. Boris Johnson: I congratulate my hon. Friend the Member for Witney (Mr. Cameron) on securing the debate and putting the case as succinctly and comprehensively as he could have done. We are trying to stop a very good school being closed. That is the sad event that we face. It is particularly sad, but not only because the school is a good one—I have been round it and seen lots of chirpy children babbling away in many European languages—and a wonderful institution. I speak rather sentimentally because, as my hon. Friend has indicated, I am the beneficiary of that kind of European education. As he reports, I was educated at the European school at Uccle in Brussels, and it did me proud. I remember fondly my days under the august headmastership of Mr. Mittler—Herr Mittler as he was known—a genial and charming man with curious leather gloves, and our bus driver Vendredi. I do not know why he was called that; perhaps that was when he turned up.
Funnily enough, the playground in that school was very much like the Council of Ministers, which I later came to know well as a reporter in Brussels. I know that some here today are closely connected with the school in Culham, so I shall do my best not to tread on their corns. However, in my day, it was striking that the Danes and the Dutch tended to team up with the Brits to bash up the French and the Italians. Perhaps it does not work like that any more—I sincerely hope that it does not—but that was what happened back in Uccle. It was a wonderful time; there was an ethos of European integration. Inscribed on some great stone at that school are the words of Jean Monnet that informed that ethos. This is how he rhapsodised in 1958 about what he hoped for from the school:
"Educated side by side, untroubled from infancy by divisive prejudices, acquainted with all that is great and good in the different cultures, it will be borne in upon them as they mature that they belong together…Without ceasing to look upon their own lands with love and pride, they will become in mind Europeans, schooled and ready to complete and consolidate the work of their fathers before them, to bring into being a united and thriving Europe."
That was the ethos, and a good thing it was too. As my hon. Friend has pointed out, it does not produce identikit Europeans. Many of us, including my brothers and sisters and other alumni, are testimony to the diversity of the pupils who were turned out by the European school. It produces people who have, to the great benefit of this country, an instinctive familiarity with other cultures and civilisations. It would be sad if that were lost. The problem, as he has well illustrated, is that it is a Community institution; it is funded by the European taxpayer, n'est ce pas? Oui. Si. It is hard to see why the European taxpayer should continue to do that when, as Neil Kinnock has pointed out, only 13 out of 883 pupils are what is called category 1 pupils. I was the son of a commissionaire fonctionnaire, but by no means everybody at Culham now comes into that category; 85 per cent. are category 3 pupils—the children of parents who have come to some kind of arrangement with the board of governors so that they can attend the school even though they have no direct association with the EU institutions. I still think that it is a good system, and it is wonderful to encourage it. It is fantastic that we should do so. Those parents pay fees, albeit that, as my hon. Friend has pointed out, they do not cover the real cost.

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They might pay £2,500 for a secondary level place at Culham that costs £9,000, the difference being met by the European taxpayer.
It is obvious from Neil Kinnock's letter that, given that considerable subsidy and the proportion of pupils who are the children of Commission officials to those who are not, he is moving against the school. Unless we can find an imaginative solution that will keep it going, it will die a slow death. My hon. Friend set out very well the options that we should pursue—not just the Government, the local education authorities and so on, but, above all, the parents themselves. The parents and the governors must seize their destiny with their own hands, develop a business plan to save the school and present it to Ministers for their consideration. He mentioned some of the obvious options: going to BMW, for example, and other local and international businesses and saying, "Come on, this is a fantastic institution. Let's support it." I know that parents have already explored the option of charging for boarding, which is permissible under the terms of the relevant legislation.
Parents and governors rightly say that they want to maintain the state-school ethos. As someone who uses state education in Islington, in spite of everything that the Minister managed to do to the set up when she was in charge of it, I can see their point; I can see its advantages. I admire the state-school ethos and I can understand why they want to keep it. However, I cannot but agree with Ministers and with the Secretary of State for Education, who said, repeatedly, that the parents and governors cannot realistically expect Her Majesty's Government to step in and pick up the tab if and when the Commission withdraws. Everybody, including the parents and governors, accepts that. They also accept my hon. Friend's point about the teachers' pay scales, which are out of whack with the set-up in the rest of the country. It would be difficult for the taxpayer to bear the cost.
What the school needs above all from the Government and from all the other institutions involved is time. As my hon. Friend said, it needs breathing space and a commitment—a confirmation that it is valued and appreciated for three reasons. First, it offers a unique form of education that could be rolled out across the country; its model of education might prove very popular. I do not say that I am a shining exemplar of the benefits of this style of education, but it is a wonderful thing that we would be rash to throw away. Secondly, however one looks at it, there will be a cost to the taxpayers in south Oxfordshire if the school is closed, which is a legitimate matter of concern for the Department for Education and Skills and for Oxfordshire.
Thirdly, as my hon. Friend said, there are considerable strategic advantages to the country in having a school that can cater for the children of distinguished scientists and business folk of all kinds, from all over the world, who want to send their children to an international school with an international ethos of the kind that Culham provides. He has already mentioned the Rutherford-Appleton laboratory and the Joint European Torus project in Culham. It is possible that as the school evolves it might have to move away from the strict federalist ethos of Jean Monnet, becoming in mind European, to a more international solution, which would not necessarily be a bad thing.
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I hope that the Minister will agree that Culham school is a good institution, and that in the name of diversity, choice and excellence, it falls to her as much as to anybody to try to keep it going. It would be sad and paradoxical if in a career that I have spent trying to close down various European Union institutions, the first one with which I had any direct relationship, and which I particularly like, admire and value, were to be closed in my constituency.
3.49 pm
The Minister for Children (Margaret Hodge): I congratulate the hon. Members for Witney (Mr. Cameron) and for Henley (Mr. Johnson) on securing the debate. On the day that the Prime Minister was going to—
Mr. Cameron: U-turn.
Margaret Hodge: I was going to talk about the hon. Gentlemen's possible conflict of interest, but on the day that the Prime Minister told us that there will be a far-reaching debate on our position in the context of Europe, it is a joy that two members of Her Majesty's Opposition should give a stunningly wonderful endorsement of the best of European culture. I hope that they take that forward. Indeed, I hope that the education that the hon. Member for Henley enjoyed at that European school bred a good European member of the Conservative party.
By the age of five I had learned four European languages. Although I never learned to read and write them—one is Italian. Mr. Deputy Speaker, which we share—I have found them invaluable. That knowledge has helped me to develop a strong European sense of being and an international persona, which have been invaluable in my work and in my attitude to others. I strongly support the concept of the European schools, including the European school at Culham.
Conservative Members have asked for three things. Knowing how such debates go, let me say immediately that all three requests are reasonable. The first is that we should seek a breathing space in which to find an imaginative solution. To an extent, that has already been achieved as a report is being compiled, which will delay a decision until well into the autumn. That gives us six months to work with the various organisations mentioned by the hon. Member for Witney—the local education authority, private sector companies and the Commission—and to see whether the Government can play a role in putting a package together. That gives us the breathing space that was requested.
The second request is for a gradual transition. I give the assurance that if the closure of the European school at Culham were proposed, we would insist on a suitable phasing-out period. That would enable not only pupils to complete their education, particularly those who are getting close to their baccalaureate exams, but the putting in place of other transitional arrangements.
The third request is for the Government to work with the school in an attempt to find a solution. Again, we give a commitment that we will do our best. However, as both hon. Members understand, it would be inappropriate to expect the Government readily and easily to invest money in the school's future, especially

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as the costs would far outweigh what is invested per pupil in the state secondary school system. We are trying to be fair in our use of funds, so it would be difficult to justify expenditure two or three times higher per pupil, which is the cost of educating children at Culham.
The Secretary of State and I strongly endorse the concept of the European school. It is an institution in which pupils can enjoy a unique form of education and it helps to build a better understanding across European states, which is essential if the European project is to be effective. However, I am sure that hon. Members are aware that there are problems. When Culham was established, it was one of a network of 12 European schools. It was set up on the basis that it served in particular the people who worked locally at the Joint European Torus project. Given that very few people employed directly through the Commission use the school, it is difficult to see how we can find a mixture of funding that will keep the ethos of the school going without having recourse to public funds, which are not readily available.
Mr. Cameron: I seek one assurance. My understanding is that the Government own the buildings, provide some funding for the teaching staff and pay some money to the Commission that ends up back at the school. They are involved in investing already, so I hope that they do not get too hung up on the money issue. The answer is to try to find a solution.
Margaret Hodge: Clearly, we need to find a solution, but our commitment to funding the institution arises from our commitment to funding institutions partly supported through the European Commission for the purposes of funding institutions that can educate the children of people employed by the Commission or organisations associated with it. We must remember the origins of the funding to justify its continuation, which
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will present some future difficulties for the Government. Nevertheless, I give the commitment that, together with the governors and those responsible for the school, we shall use all our imagination to try to ensure that it has a future.
As hon. Members probably know, at a meeting in January 2004 the European schools international governing body took a provisional decision to close seven language sections in the four small European schools. Those language sections include the Dutch and Italian sections at Culham, which are regarded as non-viable in terms of entitled student numbers. It is interesting that at Culham neither the Dutch nor the Italian language section has a single pupil who is the child of an EU employee. That is quite surprising given the international investment, particularly by Dutch companies, in the UK. We can perhaps think of partnerships that could be established with multinational companies to see whether they might contribute to funding children in the institution.
I understand that the uncertainty over the future of the European school at Culham is not only an issue of principle. It matters a lot to parents of pupils, but it is not a state school. It is run by the European school board of governors, so the issue is their responsibility. However, if proposals for closure have to be made, it is critical that the interests of pupils be protected and that their educational future is promoted.
In the light of this morning's statement to the House by my right hon. Friend the Prime Minister, I hope that Conservative Members recognise that EU enlargement will mean increased demand for the European schools system as a whole, so it is totally proper for the European Commission to consider whether the location of schools in the area is appropriate. I hope I have given the reassurances that hon. Members seek and that they ease the minds of the constituents of the hon. Member for Witney whose children attend the European school at Culham.

Mr. John Tero
4 pm
Ms Sally Keeble: I am grateful to have secured this Adjournment debate on the treatment in prison of the late Mr. John Tero, who was my constituent. It is the second Adjournment debate about him that I have initiated. Since the previous one, which was held last July, Mr. Tero has sadly died. He spent a year in prison before his conviction was quashed in December 2001. Sadly, he finally succumbed to the cancer that he developed and that went untreated while he was in prison. He was 72 when he went into prison and 74 when he died. Although progress has been made in clarifying his treatment in prison, there are still some outstanding issues. In particular, there is the quite appalling delay in getting the case resolved. I am grateful for this opportunity to deal with some of those issues. The case also raises wider issues involving prison medical services, and it is right to take the opportunity afforded by an Adjournment debate to consider some of those too.
First, I welcome the prison ombudsman's report on the case and the fact that the two prison governors have apologised for different aspects of the administration of Mr. Tero's appeal and release. I also welcome the changes that have been made as part of the independent clinical review, and I am glad that my hon. Friend the Minister set it up. The recommendations are substantial. Each prison should have and use the current guidelines for treatment of suspected cancer. I suspect that there is quite a long way to go to ensure that those are in place and that people know how to use them properly.
Other recommendations are that each prison should have regular clinical effectiveness meetings and that changes should be made in referral systems and record keeping. Greater accountability on getting prisoners to hospital appointments is needed. It is important that these changes are fully implemented as they will go some way towards preventing some problems that my constituent so sadly experienced. More changes are needed, however, and I will set them out.
One of the biggest issues for me in dealing with this case, and for the family as well, has been the time it is has taken to get even the most basic information. Moreover, some of that information is wrong or misleading. I will give two examples. One of the first things that my constituent raised with me was his weight loss in prison, which he rightly attributed to his illness, yet I received three letters—two from my hon. Friend's predecessor and one from the director-general of the Prison Service—giving his only recorded weight as 77.5 kg, 75 kg or 77.8 kg. I repeatedly asked what explanation the Prison Service had for John Tero weighing only 66 kg when he arrived at Northampton general hospital on 8 January 2002, which was about 10 days after he left prison.
The letter from my hon. Friend's predecessor stated that Mr. Tero's weight
"remained fairly stable throughout the period in question".
Phil Wheatley, the director-general, wrote to me on 27 March 2003 saying that Mr. Tero's weight had increased slightly, adding that
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"his records show no requirement to weigh him more often."
When I got a copy of his prison medical records earlier this year—as a result of the ombudsman's reports and findings, not in response to my requests—I discovered that those statements are not accurate. There was a clear entry on the inmate medical record in October of John Tero's weight falling to 73 kg and a further clear entry on 14 December stating, "BW 68 kg". I take that to mean body weight 68 kg.
It is clear that the Prison Service knew how much weight Mr. Tero had lost. There was no need for a review or an inquiry. All that was needed was someone being honest about what was in the prison medical records and providing the obvious explanation for it, which is that my constituent had developed a serious illness. Just yesterday—this is an example of how frustrating the case has been—I received a letter from Preston hospital with John Tero's medical records. I had asked for them some months ago. They list under his indications for an endoscopy
"reflux symptoms and weight loss".
It was clearly known that he had been losing weight.
Furthermore, John Tero complained of being sick and unable to eat. Mr. Wheatley's letter said that there was no reference in the records to the fact that he was
"declining food at this period, the only complaint recorded was one of gastric reflux."
However, the records show an entry for 15 October of
"vomiting after meals x 3/12".
I take that to mean vomiting after meals for three months. The same note is repeated in the information that I received yesterday. Those are just three examples, and there are others. They have been profoundly damaging in the months after Mr. Tero's death as we have tried to take the family through what happened to their husband and father.
Reading the inmate medical record gives a sad picture of an elderly man trying to attract attention to his steadily fading health. A steady catalogue of complaints starts on 26 April and ends when he was finally found to have cancer—on 17 December, the day before he won his appeal against conviction and two days before he went home. This is a completely different picture from that painted in the three Home Office letters that came in response to my early inquiries.
This place relies on Members being told the truth the whole truth. It is impossible for us to represent our constituents properly and to take up issues with the Government on their behalf if we do not get full and honest answers. What makes this particularly galling is the fact that if that information had been provided with those explanations—as it should have been—on the basis of an exchange of letters 17 months ago, my constituent would have probably got what he wanted, which was an apology before he died.
The issue of access to information is a big one. People have a right to information about themselves, and Departments and other agencies must respect that. On a more practical level, if prisoners are to be able to manage their health, they need access to their medical files and they need the ability to complain—as they will have the right to do—and to get improvements in their care. A closed medical system inside a closed institution

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will leave vulnerable the most frail and elderly prisoners. My constituent was a pensioner when he was sent to prison.
Another issue about which I am very concerned is a muddle in the record keeping. There appears to be little consistency about what is recorded and in how much detail. There is certainly enough detail in John Tero's medical records to see after the event how my constituent's health deteriorated, but I am not sure that there was enough for the doctors treating him at the time.
There are also failures in how the notes were recorded. I have spoken to my hon. Friend about that, and I think that he observed the same thing. Some entries, to put it politely, did not withstand being photocopied. For example, there is still a dispute over the date on which John Tero first reported his stomach problems. My photocopy shows 26 April; Dr. Blackburn's photocopy, which was of worse quality, showed 17 July. That is a small point, but I have requested revised copies of some pages and I would be grateful for those. The family still cannot see exactly what happened because we have not had a fair copy of some pages of the records. I will give my hon. Friend a note of those pages later.
Dr. Blackburn's review deals with many of those issues, and I certainly welcome the changes that he proposes on record keeping, but it does not deal with some of the muddle that is the reality that lies behind the records. For example, I understand that there is a procedure for getting to see someone at some prison health care units. Prisoners do not get to see a medical officer on demand; there is some gate keeping or referral by prison officers. I am not clear whether John Tero's repeat visits to the health care unit represent all his requests for medical treatment or whether he spoke to prison officers several times without a referral note going through.
It is also not clear from the records exactly who John saw when he visited the prison health care unit, whether they were doctors or nurses and what authority their notes carried. For the protection of the staff and prisoners, there must be clear, standardised procedures to allow prisoners to see health care staff, with the requests recorded. There also needs to be some clarity as to who the prisoner should see and whether they should be a nurse or a doctor. I assume that the rights of prisoners in that regard should be the same as for people outside prison in wider society. The records also show how John Tero very nearly got access to the treatment that he needed and how his hopes were cruelly dashed—not just once, but twice—because of weaknesses in the administration of the prison system.
Bizarrely, John did not get to see the more specialist doctor the first time because in the six days or so between the referral and the appointment he was declared medically fit to be moved. On the very day he was supposed to see the doctor, he was transferred to a prison almost at the other end of the country. We must ask why prisoners are transferred when they have appointments and such outstanding medical difficulties. There is a problem with churning in the prison system, which I am sure the Minister is aware of. The repeated moving of prisoners disrupts education and other programmes. Why a person who has been referred for
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medical treatment should be moved before they are due to receive that treatment is quite incomprehensible. It should not happen.
John Tero did not get access to a specialist doctor for a second time because a hospital appointment was cancelled owing to the lack of a prison escort. That is also completely unacceptable. It did not help that, when he finally got to the hospital, the request form for the appointment was only partially completed. I am sure that we could dispute how much priority he should have received, but it is a fact that he was not given high priority and he did not receive an urgent appointment.
I want to raise issues involving Dr. Blackburn's reports and what happens when things go wrong. It is of course helpful to have a review and I am grateful to my hon. Friend for that. However, a closed investigation of a closed institution will not persuade the outside world, much less a grieving family. The ability to have an open and transparent review when things go wrong would help to build confidence and it is also consistent with our obligations under various human rights legislation. That ability would also help to avoid some basic mistakes that have, to an extent, marred the Blackburn review for some members of John Tero's family.
One result of the decision to wait until after the report had been written to open up the review and allow the family to speak, question and give their own evidence is that now, some 17 months after John first came to see me, some basic facts are still unclear, including the date on which he first complained about stomach problems. The sequence of his complaints is also unclear, because of mix-ups involving the dates in some prison medical records. I hope that my hon. Friend understands that having to haggle over the most basic facts at this late stage continues the hardship that Mrs. Lilian Tero and her family have suffered when they need to put some of the sadness behind them. It is quite incredibly and needlessly cruel.
Therefore, I ask my hon. Friend to do the following quickly, but of course properly. He should ensure that Dr Blackburn agrees with the family the correct sequence of events during John Tero's period in Woodhill and Wymott prisons. The various evidence from the prison medical records, the prescription records, evidence from Northampton general hospital and Preston primary care trust, the information from the ombudsman's investigations and the original records—not the poor photocopies—should all be compared. My hon. Friend should deal with the outstanding request for compensation that I first made in November 2002. He should provide assurances on how the recommendations of the Blackburn review will be implemented and monitored, so that the rest of the Tero family and prison reform groups can be certain either that such cases will not happen again or that there will be proper means to deal with them if they do. I am sure that my hon. Friend has come across other cases where the family want to know not only that recommendations have been made, but that they have been implemented.
My hon. Friend would also do well to consider some wider implications of the case. What does it say about the provision of information by the Home Office and the Prison Service? How can prisoners better access health care services and, in particular, how can older and more vulnerable prisoners be protected? The problems of the

65WH
prison medical service have been well documented by the chief inspector of prisons and by prison lobby groups, in particular the Prison Reform Trust. The chairman of the British Medical Association civil service committee has described the prison medical service as a "crisis waiting to break". That was in 2001, but many of those criticisms still hold true. With an ageing prison population and serious levels of mental illness among prisoners, the demands on the service are huge and growing. It needs to be able to meet those needs in a professional manner that provides proper medical care and respects the humanity and dignity of the prisoner.
It will not do to say that John had a terrible form of cancer and that the outcome would sadly have been the same, because that is not the point. He could have been spared much physical suffering and mental anguish, including that of dying with a burning sense of injustice over the treatment he received. My constituent wanted other people to be spared what he suffered, and I hope that that is the final outcome of this very sad case.
4.16 pm
The Parliamentary Under-Secretary of State for the Home Department (Paul Goggins): I congratulate my hon. Friend the Member for Northampton, North (Ms Keeble) on securing this debate. Once again, she has rightly brought to the attention of the House in a fair and balanced way her concerns about the health care and medical treatment that was given to her late constituent, Mr. John Tero, when he was in prison.
My hon. Friend first raised this issue in correspondence with my predecessor at the Home Office and subsequently raised it in a debate in the House on 14 July last year. As she mentioned, Mr. Tero sadly died on 22 September last year. Even at this late stage, I join her in expressing my condolences to Mrs. Tero and other members of her family.
I listened carefully to the points made by my hon. Friend, and I have had the opportunity to discuss the matter with her several times outside the Chamber. I pay tribute to the tenacity with which she sought to get at the facts of the case. It is clear that if she had not done so, some of the information that we now have would have remained unclear or even unknown. I hope that she will find it helpful if I respond initially by setting out some of the background.
Mr. Tero was first received into Woodhill prison on 15 December 2000. In May 2001, he successfully underwent surgery for a condition that had been diagnosed before he went to prison. At around the same time—I shall return to this issue later in my speech—he began to report symptoms of what turned out to be a different condition. During the next few months, he was seen several times by the NHS general practitioners working at Woodhill, who prescribed medication for him.
Mr. Tero was transferred to Wymott prison on 9 October 2001. During the routine reception health screening, his continuing health problem was again identified and recorded. On 15 October 2001, he consulted a doctor at Wymott with more symptoms. In view of that development, he was referred to a local NHS hospital for special investigation. Regrettably. the first appointment made for him for 20 November was cancelled at short notice. A new one was arranged for 12
66WH
December. When the investigation eventually took place, it revealed a serious condition—cancer of the oesophagus—that merited further intervention. The hospital made another appointment for him on 19 December. As my hon. Friend explained, however, he was released from Wymott on that day, and subsequently underwent treatment for his condition from the NHS in his home town of Northampton.
Mr. Tero's weight remained largely stable until October 2001, but it dropped significantly when he was released from prison because of the development of his illness. On 1 April, I wrote to my hon. Friend to apologise for the erroneous information provided in earlier letters from the Prison Service and the Home Office about his weight loss. It is clear from Mr. Tero's medical records that between 4 October and 14 December 2001, his weight fell from 77 kg to 68 kg. It is regrettable that this was not confirmed earlier to my hon. Friend. The letters were written in good faith, but they fell short of the standard that should be expected. Again, I apologise.
Last July in the House, my hon. Friend voiced several serious concerns about Mr. Tero's treatment in prison, which she felt merited at the very least a full apology for the suffering and hardship that he had experienced. I said in my response that I would be the first to offer such an apology on behalf of the Home Office and the Prison Service if one was merited. To enable me to make a proper judgment, I asked the director of prison health to arrange for an independent clinical review of Mr. Tero's care and treatment in prison. In turn, he commissioned Dr. Joseph Blackburn, a general practitioner and clinical governance lead for North Surrey primary care trust, to conduct that review. I welcome the welcome that my hon. Friend gave to that clinical audit.
Dr. Blackburn submitted the report of his review on 25 November, but was then asked, at my hon. Friend's suggestion, to take into account Mr. Tero's own notes, which he had passed to her. She also asked that Dr. Blackburn interview Mr. Tero's family before completing his report. However, although there was sympathy for the family's position, it was not readily apparent that asking Dr. Blackburn to interview them was likely to add anything of substance to what was intended to be a tightly focused clinical review of Mr. Tero's care and treatment in prison.
One recommendation in Dr. Blackburn's report was that an NHS consultant oncologist should be asked for a specialist opinion on whether an earlier diagnosis might have increased Mr. Tero's chances of being cured of his oesophageal cancer by treatment. That recommendation was accepted, and Dr. Blackburn commissioned Dr. Daniel Hochhauser, the Kathleen Ferrier reader and consultant in medical oncology at the Royal Free and University College medical school in London, to provide that report.
After Christmas, I wrote to Mrs. Tero to offer her the opportunity of a meeting with officials at which the contents, conclusions and recommendations of Dr. Blackburn's report could be disclosed to her together with the Prison Service's response, including any appropriate apology. Dr. Hochhauser completed his report on 27 February. That enabled me to send copies of both reports to Mrs. Tero in good time for that

67WH
meeting, which took place in the House on 15 March. I am very grateful to my hon. Friend for helping to arrange that.
In my covering letter to Mrs. Tero, I gave an indication of both doctors' principal conclusions. I also offered her my sincere apologies for the failures that Dr. Blackburn had identified in the medical treatment afforded to her husband at both prisons. Dr. Blackburn's principal findings, which we accept entirely, were that Mr. Tero should have been referred for specialist opinion at an earlier stage during the time that he was in Woodhill prison, and through the urgent cancer referral guidelines. If that had been done, it is clear that we would not have transferred Mr. Tero to Wymott prison in October 2001. In addition, Dr. Blackburn concluded that the appointment for the endoscopy made for Mr. Tero while he was at Wymott should not have been delayed owing to a lack of escort staff.
I should add for completeness that we have also accepted two findings of the prisons and probations ombudsman, whom my hon. Friend asked to look into other aspects of Mr. Tero's treatment. Those findings were that there was maladministration at Woodhill prison in his appeal paperwork and that the Prison Service should have taken more care when releasing him and in helping him to travel home.
At the meeting on 15 March, my hon. Friend raised several questions about the documentation used by Dr. Blackburn that it had not been not possible to resolve at that time. One significant issue was that copies of entries in Mr. Tero's medical record, of which she had obtained a copy, suggested that he had complained about a stomach problem some time earlier than was indicated in Dr. Blackburn's report. It appeared that Dr. Blackburn's conclusions were based on an incomplete copy of Mr. Tero's medical record. It was therefore agreed that the prison health team would obtain and check my hon. Friend's assertion against Mr. Tero's original inmate medical record. Dr. Blackburn would then, as a matter of urgency, consider whether the points made by my hon. Friend affected his report and revise it if appropriate.
It was agreed that Dr. Blackburn and Dr. Howells, the medical director in the prison health team, who was also present at the meeting, would then meet Mrs. Tero and her son again, this time in Northampton, to discuss the outcome of the further work. Dr. Howells went on to offer Mrs. Tero and her son a personal apology for the failures in the care and treatment afforded to Mr. Tero. He also explained the specific actions that were being taken to ensure that the lessons of his experience were fully learned at both local and national level. I am sure that my hon. Friend and the House will want me to set out some of those this afternoon.
First, the prison health team will ensure that all prison health care managers are reminded of the referral guidelines for suspected cancer that were issued to all general practitioners in health service circular 2000/13.
Secondly, managers will also be asked to ensure that those guidelines are considered at local clinical effectiveness meetings as part of their local clinical
68WH
governance systems. I assure my hon. Friend that appropriate action on both issues is already being taken at the two establishments most immediately concerned.
Thirdly, the prison health team will seek to ensure that every prison establishment has a system in place for identifying priority out-patient referrals to hospital and managing them appropriately. They will do so by including appropriate material in proposed prison service orders, both on improving continuity of care and governors' responsibilities.
Fourthly, the prison health team will produce guidance on the special circumstances of discharging prisoners who are physically ill, which will also be included in the new Prison Service order on improving continuity of care. When the new prisoners' clinical record comes into use later this year, it will be accompanied by guidance to staff on the proper completion of medical entries. That point was made by my hon. Friend and I assure her that issues such as the sort of pen that should be used when making notes will be important, particularly with reference to the medical record to which she referred.
Finally, to ensure that issues raised about the performance of NHS organisations outside prison are also reviewed, the prison health team will send copies of the reports from Dr. Blackburn and Dr. Hochhauser to the clinical governance leads at the relevant NHS trust.
Dr. Howells concluded the meeting with Mrs. Tero and her family by explaining the general background of the changes now under way to the organisation and delivery of health services to prisoners, which will culminate in primary care trusts assuming full commissioning responsibility for prison health services by 2006. He agreed to set that out fully in writing to Mrs. Tero and her son after the meeting in Northampton. With regard to the powerful point that my hon. Friend made towards the end of her speech, with that move to commissioning in 2006—it has already begun, but it will be complete by 2006—there will be proper NHS oversight of the health care that is available in all our prisons. That will lead to higher standards.
A number of outstanding issues remain in this case and I believe that the best way to resolve them is, in the first instance at least, to proceed along the lines agreed with my hon. Friend, Mrs. Tero and her son at the conclusion of the meeting on 15 March. In addition, my right hon. Friend the Home Secretary agreed to meet my hon. Friend, Mrs. Tero and her family in an attempt to bring this sad experience to a conclusion.
With regard to the request for compensation in the form of an ex gratia payment to Mr. Tero's family, I will establish immediately a process for giving careful consideration to this matter. It will not, of course, be possible to reach a final conclusion until Dr. Blackburn has concluded his further work.
I will continue to liaise with my hon. Friend as matters progress towards a conclusion. Nothing can put right the errors that have been made and nothing can bring Mr. Tero back, but I shall not be happy until Mrs. Tero and my hon. Friend are happy that they are in full possession of all the facts and that all the appropriate action has been taken.
It being half-past Four o'clock, the motion for the Adjournment of the sitting lapsed, without Question put.

HEALTH

  Substance Abuse
  Mr. Hancock
  To ask the Secretary of State for Health how many people have died as a result of abuse of(a) butane gas refills and (b) other volatile substances in each year since 1997. [165759]

  Miss Melanie Johnson
  Statistics, collected by St. George's Hospital Medical School on behalf of the Department, on volatile substance abuse deaths from cigarette (butane) lighter refills, and total volatile substance abuse deaths are shown in the tables.

  Deaths associated with cigarette lighter refills

  Year

  Number

  1997

  47

  1998

  43

  1999

  43

  2000

  34

  2001

  42

  Deaths by volatile substance abuse

  Year

  Number

  1997

  78

  1998

  80

  1999

  75

  2000

  65

  2001

  63

  Source:

  St. George's Hospital Medical School: 16th Annual Report on Trends in Death Associated with Abuse of Volatile Substance 1971–2001—Key findings for 2001.

  Mobile Phone Masts
  Mr. Bailey
  To ask the Secretary of State for Health when he expects the mobile telecommunications and health research programme to report on the public health implications of mobile phone masts. [165908]

  Miss Melanie Johnson
  The mobile telecommunications and health research programme reports progress at open seminars each year. The majority of projects are due to be completed in time for the annual seminar in November 2005. The remaining projects may take up to three years longer depending on their complexity. Most of the studies are concerned with mobile phones rather than base stations (masts) although there is one volunteer study looking specifically at base station exposures. Further details of these projects can be found on the website www.mthr.org.uk.

  The public health implications of mobile phone base stations were reviewed recently by the National Radiological Protection Board's advisory group on non-ionising radiation, (Documents of the NRPB,
  410W
  Vol. 14, No 2, 2003). The report, entitled Health Effects from Radiofrequency Electromagnetic Fields, concluded that
  "Exposure levels from living near to mobile phone base stations are extremely low, and the overall evidence indicates that they are unlikely to pose a risk to health."
  The report is available at www.nrpb.org.uk.

  Breast Cancer
  Mr Frank Field
  To ask the Secretary of State for Health how many and what percentage of women in Birkenhead with suspected breast cancer saw a specialist within two weeks in each of the last five years. [166570]

  Miss Melanie Johnson
  The information requested is shown in the table:

  Waiting times for patients referred urgently by their GP with suspected breast cancer to 1st outpatient appointment: Wirral Hospitals NHS Trust

  Year

  Quarter

  Percentage of patients seen in two weeks ℅

  Total patients seen

  Patients seen in two weeks

  1999/00

  1

  42.0

  81

  34

  1999/00

  2

  64.0

  100

  64

  1999/00

  3

  67.3

  110

  74

  1999/00

  4

  93.7

  111

  104

  2000/01

  1

  88.3

  111

  98

  2000/01

  2

  91.0

  100

  91

  2000/01

  3

  91.4

  128

  117

  2000/01

  4

  100.0

  153

  153

  2001/02

  1

  100.0

  126

  126

  2001/02

  2

  100.0

  148

  148

  2001/02

  3

  100.0

  167

  167

  2001/02

  4

  100.0

  173

  173

  2002/03

  1

  100.0

  165

  165

  2002/03

  2

  100.0

  160

  160

  2002/03

  3

  100.0

  137

  137

  2002/03

  4

  99.2

  118

  117

  2003/04

  1

  100.0

  146

  146

  2003/04

  2

  100.0

  197

  197

  2003/04

  3

  100.0

  190

  190

  Source:

  DH form QMCW

  Smoking
  Sandra Gidley
  To ask the Secretary of State for Health what programmes he has in place to encourage smoking cessation among the over-60s. [166010]

  Miss Melanie Johnson
  Our comprehensive tobacco control programme is aimed at all age groups, to reduce the numbers starting to smoke and to encourage those who smoke to stop. National Health Service stop smoking services are in place across the country to support smokers who want to quit. The services welcome people of all ages, and are widely available and accessible.

  Standard 8 of the national service framework for older people provides a continuing commitment to the health and well being of older people. An increase in access to local NHS stop smoking services is one important component in extending healthy life expectancy in older people.
  411W
  Between April and September 2003 over 23,300 smokers aged 60 or over set a date to quit smoking with the help of NHS stop smoking services and nearly 14,800 reported that they had successfully quit four weeks later. This means that an encouraging 63 per cent. in this age group were successful in quitting.

  Edward Jenner Institute
  Mr. Rendel
  To ask the Secretary of State for Health what plans he has for the future of the Edward Jenner Institute at Compton; and what funding he as allocated to the institute for future years. [162227]

  Miss Melanie Johnson
  [holding answer 18 March 2004]: The Edward Jenner Institute for Vaccine Research (EJIVR) was established in 1995 to develop programmes in basic research relevant to human and animal vaccines. GlaxoSmithKline, the Medical Research Council, the Biotechnology and Biological Sciences Research Council and the Department of Health contributed a total of £6 million per annum to establish and fund the EJIVR for an initial 10 year research programme.

  The four sponsors remain committed to supporting basic and applied vaccine research through to the end of the current term in October 2005. However, they have agreed that the existing joint funding model for the EJIVR is not the best way forward beyond 2005.

  The sponsors are working actively with the board of the EJIVR to progress vaccine research beyond October 2005. The sponsors have recently completed a scientific review of the EJIVR's research programmes. The outcomes from this are assisting the board in its development of future plans to build on the best programmes, scientifically and strategically. Until the board's plans have progressed further, it is not possible to be more specific about the future.

  Tuberculosis
  Mr. Dalyell
  To ask the Secretary of State for Health what his policy is on the containment of tuberculosis, with particular reference to containment of strains which may not respond to treatment by established procedures. [162914]

  Miss Melanie Johnson
  [holding answer 23 March 2004]: The interdepartmental working group on tuberculosis document was published in September 1998. It is entitled:

  The prevention and control of Tuberculosis in the United Kingdom:

  UK Guidance on the Prevention and Control of Transmission of:

  1. HIV,-related Tuberculosis.

  2. Drug-resistant, including Multiple Drug-resistant Tuberculosis.

  It gives advice on the contaiment of tuberculosis and multi-drug resistant tuberculosis. It is available in the Library.

  Working Time Directive
  Dr. Murrison
  To ask the Secretary of State for Health what assessment he has made of the costs of implementing the European Working Time Directive in(a) money terms, (b) extra doctors required and
  412W
  (c) other extra NHS staff required for (i) August 2004 and (ii) 2009; and what methodology he used to calculate those figures. [164568]

  Mr. Hutton
  [holding answer 30 March 2004]: The Working Time Directive (WTD) is an integral part of modernising and improving services. The National Health Service has been aware of the implications of implementing the WTD for doctors in training since 2000, and planning for it forms part of overall NHS planning.

  In the United Kingdom's response to the European Commission's questionnaire on working time, which was completed in February, we stated that in the UK the NHS would need to recruit several thousand extra middle grade doctors by August 2004 to achieve compliance with the re-interpreted Working Time Directive, while simultaneously maintaining current levels of service provision and retaining similar working practices as now. The cost of recruiting the extra middle grade doctors would run to hundreds of millions of pounds per annum.

  However, this is not a realistic scenario. Even if this number of additional doctors were available, implementing the directive in this way would be very inefficient. As stated in our recent response to the EC's communication on working time, solutions need to include alternative ways of working that are already being piloted in the NHS, such as substituting non-medical practitioners where possible, instituting new forms of multidisciplinary team working, or redesigning services in some areas. There is no 'one size fits all' solution and ways of becoming WTD compliant will vary between trusts. Actual costs or numbers of additional staff required are not held centrally and could not in any case be disaggregated from the overall cost of NHS growth and modernisation.

  NHS Foundation Trusts
  Mr. Lansley
  To ask the Secretary of State for Health when he expects to lay before Parliament the code for determining the limit on the total amount of borrowing of any NHS Foundation Trust required by section 12 of the Health and Social Care (Community Health and Standards) Act 2003. [166073]

  Mr. Hutton
  The Independent Regulator of National Health Service foundation trusts is responsible for making the Prudential Borrowing Code.

  The draft prudential borrowing code has not yet been issued for consultation. I am informed by the Independent Regulator that a draft code is expected to be issued for consultation shortly and will be subject to a 12-week consultation period. Following the consultation, the Regulator will consider the responses, amend the code as required, make the final code and lay a copy before Parliament.

  Primary Care Trusts
  Mr. Lansley
  To ask the Secretary of State for Health if he will list each primary care trust indicating its variation from(a) average per-capita resources in England and (b) their Resource Allocation Working Party as fair share funding formula. [166660]
  413W
  Mr. Hutton
  The information requested has been placed in the Library.

  Hospital Discharges
  Mr. Willis
  To ask the Secretary of State for Health how many elderly people have been subject to eviction as a result of rent arrears after a stay in hospital in each year since 1997. [166517]

  Dr. Ladyman
  The Department does not collect this information.

  Mr. Willis
  To ask the Secretary of State for Health what steps he has taken to improve communication between health and social services to support vulnerable people who risk losing their homes as a result of rent arrears built up during a stay in hospital; and if he will make a statement. [166518]

  Dr. Ladyman
  The Community Care (Delayed Discharges etc.) Act 2003 introduced a system of notifications between National Health Service bodies and social services departments which has improved communication and co-ordination between health and social care partners at the point of discharge.

  In addition, since March 2003 working age patients have continued to receive their full entitlement to any incapacity benefits, Income Support, bereavement benefits, Housing Benefit and Council Tax Benefit for 52 weeks. Also pensioners continue to receive their full State Retirement Pension, Pension Credit, Housing Benefit and Council Tax Benefit entitlement for 52 weeks.

  Mr. Willis
  To ask the Secretary of State for Health what procedures are in place to prevent elderly people returning home from hospital being subject to eviction orders as a result of rent arrears. [166520]

  Dr. Ladyman
  From May 2003 pensioners have continued to receive their full State Retirement Pension, Pension Credit, Housing Benefit and Council Tax Benefit entitlement for 52 weeks in order to ensure that they can continue to maintain their living expenditure. The Department has taken action to ensure that hospital discharges are planned effectively and completed in a timely manner.

  Hospital-acquired Infections
  Mr. Burstow
  To ask the Secretary of State for Health if he will make a statement on the Nosocomial Infection National Surveillance Scheme, including its current remit and responsibilities. [165246]

  Miss Melanie Johnson
  The nosocomial infection national surveillance scheme was a voluntary reporting system for two types of data: hospital-acquired blood stream infection and surgical site infection. The first stopped in 2002, while the second continues as the surgical site infection surveillance service. Its remit is to help trusts use surveillance data to monitor and improve the quality of patient care.

  Mr. Burstow
  To ask the Secretary of State for Health when he will publish the systematic review of how infection control guidelines are implemented in the NHS carried out by Thames Valley University. [165249]
  414W
  Miss Melanie Johnson
  Thames Valley University will update existing guidelines1 on preventing hospital-acquired infections later this year, but has not undertaken a systematic review of their implementation.
  1 The epic project: developing national evidence-based guidelines for preventing healthcare association infections phase 1: guidelines for preventing hospital-acquired infections 2001 http://www.dh.gov.uk/assetRoot/04/07/73/68/04077368.PDF
  Mr. Burstow
  To ask the Secretary of State for Health what guidance his Department has issued to neonatal intensive care units on the use of (a) broad spectrum antibiotics to prevent infections and (b) more targeted antibiotic approaches. [165242]

  Miss Melanie Johnson
  We have not issued specific guidance but the medicines management framework provides standards for the best use of all medicines in hospitals. This includes a recommendation that a lead pharmacist for anti-microbial prescribing is responsible for ensuring that appropriate policies are in place.

  Mr. Burstow
  To ask the Secretary of State for Health whether the National Care Standards Commission records incidences of MRSA in care homes. [165243]

  Miss Melanie Johnson
  The National Care Standards Commission did not have records of methicillin resistant Staphylococcus aureus (MRSA) infections.

  Health Services (Hull and East Yorkshire)
  David Davis
  To ask the Secretary of State for Health (1) how many cases of MRSA have been identified in hospitals within Hull and East Yorkshire Hospitals NHS Trust in each of the past five years; [165038]

  (2) what percentage of patients in hospitals within Hull and East Yorkshire Hospitals NHS Trust are infected with MRSA; [165039]

  (3) what percentage of NHS staff within Hull and East Yorkshire Hospitals NHS Trust are infected with MRSA. [165043]

  Miss Melanie Johnson
  The data are not collected centrally. Available data from the national mandatory surveillance system for methicillin resistant Staphylococcus aureus (MRSA) bloodstream infections are shown in the table.

  Number of methicillin resistant Staphylococcus aureus bacteraemia laboratory reports, Hull and East Yorkshire Hospitals NHS Trust

  Year

  Number of reports

  MRSA rate (per 1,000 bed-days)

  April 2001—March 2002

  106

  0.26

  April 2002—March 2003

  75

  0.18

  415W
  David Davis
  To ask the Secretary of State for Health how many beds there are in the Hull and East Yorkshire Hospitals NHS Trust. [165042]

  Miss Melanie Johnson
  The average daily number of available beds in wards open overnight at Hull and East Yorkshire National Health Service Trust in 2002–03 was 1,391. In addition, the average daily number of day case beds in 2002–03 was 107. Information for each NHS trust is published annually on the Department's website at http://www.performance.doh.gov.uk/hospitalactivity/. Information for 2003–04 will be available in the summer.

  David Davis
  To ask the Secretary of State for Health how many nurses work in hospitals in the East Riding of Yorkshire. [165044]

  Miss Melanie Johnson
  The information requested is shown in the table.

  National Health Service hospital and community health services: Qualified nursing, midwifery and health visiting staff in Hull and East Yorkshire Hospitals NHS Trust as at 30 September 2003

  headcount

  All qualified nurses

  Community

  Hospital

  Hull and East

  Yorkshire

  Hospitals

  NHS Trust

  2,399

  0

  2,399

  Source:

  Department of Health Non-Medical Workforce Census.

  David Davis
  To ask the Secretary of State for Health how many cases of tuberculosis there were in the East Riding of Yorkshire in each of the past five years. [165047]

  Miss Melanie Johnson
  The information requested is shown in the table.

  Year

  Health Authority

  TB cases

  1998

  East Riding

  17

  1999

  East Riding

  30

  2000

  East Riding

  37

  2001

  East Riding

  37

  2002

  East Riding

  18

  Source:

  Department of Health.

  Bacterial Resistance
  Mr. Watson
  To ask the Secretary of State for Health what research his Department has undertaken into anti-adhesive therapy to combat bacterial resistance in hospitals. [165025]

  Miss Melanie Johnson
  The Department has not commissioned research specifically on anti-adhesive therapy to combat bacterial resistance in hospitals. However, a broad strategic programme of research worth over £2.5 million has recently been commissioned, aimed at improving our scientific understanding of anti-microbial resistance.
  416W
  Mr Burstow
  To ask the Secretary of State for Health what action his Department is taking to encourage pharmaceutical companies to research new antibiotics to combat the threat of antibiotic resistant bacteria. [165239]

  Miss Melanie Johnson
  Our policy concentrates on supporting appropriate prescribing rather than influencing industry's research programmes.

  Fertilisation and Embryology
  Mr. Watson
  To ask the Secretary of State for Health what assessment his Department has made of new processes to produce stem cell-like cells from the blood. [165027]

  Miss Melanie Johnson
  The Government consider that it is too soon to say what kind of stem cells will yield breakthroughs in scientific knowledge enabling new treatments to be developed. The Government are therefore promoting research across a full range of stem cell sources.

  Mr. Watson
  To ask the Secretary of State for Health if he will make a statement on the use of online human egg matching services [165032]

  Miss Melanie Johnson
  The use of donor eggs in treatment in the United Kingdom is subject to the provisions of the Human Fertilisation and Embryology Act 1990 and is regulated by the Human Fertilisation and Embryology Authority (HFEA). Standards of practice for the donation of eggs and their subsequent use in treatment, including remuneration for donors, are set out in the HFEA's code of practice. Payments that may be made to donors are limited to £15.00 per donation plus reasonable expenses. These provisions apply irrespective of the potential donor's country of origin or the route by which they are linked to a potential recipient.

  Thalassaemia
  Mr. Watson
  To ask the Secretary of State for Health what measures his Department is taking to fund research into combating beta thalassaemia major. [165250]

  Miss Melanie Johnson
  Details of research projects relating to beta thalassaemia major funded by, or of interest to, the National Health Service are available on the National Research Register (NRR) at www.updatesoftware.com/national. The NRR currently contains details of around 20 on-going or completed projects with a specific focus on beta thalassaemia, in addition to a larger number of projects covering a wider range of haemoglobinopathies. Many of these projects are funded through allocations made annually to NHS providers for research to meet the priorities and needs of the NHS and to meet the costs to the NHS of hosting research supported by external funders. The total amount allocated to NHS providers in 2003–04 for research and development was £442 million.
  417W
  The NHS health technology assessment programme has published reviews of Screening for sickle cell disease and thalassaemia (2000) and Antenatal and neonatal haemoglobinopathy screening in the UK (1999). These are available on the programme's website at www.hta.nhsweb.nhs.uk.

  The Medical Research Council (MRC) has a long history of research into the causes and treatment of thalassaemia. Since 1980, the MRC molecular haematology unit in Oxford has undertaken both basic research into the process by which multipotential haemopoietic stem cells differentiate into the highly specialised cells found in blood, and also more applied research into how these processes are perturbed in inherited and acquired human genetic disesases (e.g. thalassaemia). The unit has an annual budget of over £2 million. The MRC also supports two grants in this area.

  Animal Experiments
  Norman Baker
  To ask the Secretary of State for Health, pursuant to his answer 25 February 2004,Official Report, column 467W, what reasons underlay the decision to authorise the payment towards the cost of research into the public's attitude to research involving animals. [165816]

  Miss Melanie Johnson
  The Government supported the 2002 MORI poll because it provided data on public attitudes to inform development of Government policy relating to the use of animals in medical research. The survey also provided data to assess any changes in public attitudes since the 1999 MORI poll carried out for the Medical Research Council.

  Sustainable Development
  Mrs. Calton
  To ask the Secretary of State for Health what progress has been made on his Department's Sustainable Development Strategy. [165441]

  Miss Melanie Johnson
  The Department of Health's strategy on sustainable development and the environment is in line with the Government's overall sustainable development strategy, in which health ("expected healthy years of life") is one of the 15 key headline indicators. The Department is currently implementing a change programme which will result in shifting responsibility to the front line and focusing on providing strategic leadership to the National Health Service and social care. A review of the sustainable development strategy is currently under way as part of this process.

  The Department's strategy should be viewed in the context of overall health strategies. On-going actions to raise awareness, integrate sustainable development into policy making and enhance operational activities for both the central Department and through advice to the NHS ensures that the Department continues to
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  contribute to the Government's overall strategy on sustainable development. Progress is reported on the Department's website at: http://www.dh.gov.uk/About Us/AimsAndObjectives/SustainableDevelopment/fs/en

  The NHS Estates Agency (NHSE) and the NHS Purchasing and Supply Agency (NHS PASA)—both Executive Agencies of the Department—have their own sustainable development/environmental strategies in place. The NHSE has issued a New Environmental Strategy for the NHS and Sustainable Development in the NHS as guidance for the NHS. NHS PASA has a sustainable development policy which it published in February 2003. This policy describes the framework within which NHS PASA will conduct its activities in order to contribute towards global pursuits of sustainable development. There are links to these Agencies' websites at the above address.

  Mrs. Calton
  To ask the Secretary of State for Health if he will list the meetings at which his Department has been present on the delivery of sustainable development across Government as co-ordinated by the Ministerial Sub-committee of Green Ministers. [165442]

  Miss Melanie Johnson
  The Department's Green Minister is a member of the ENV(G) Cabinet sub-Committee. Additionally, officials regularly attend working groups and other fora which report directly to ENV(G), related to the development of the Framework for Sustainable Development on the Government Estate. In particular, my officials have been closely involved in the development of procurement targets for the Framework and the Department is represented on the sustainable procurement group.

  As part of the public sector food procurement initiative, the Department for Environment, Food and Rural Affairs (DEFRA) is working with government departments to develop food action plans. The Department's NHS Purchasing and Supply Agency and its NHS Estates Agency have been working with DEFRA to develop a food procurement action plan which sets a framework and objectives for those Agencies and the wider National Health Service.

  Mrs. Calton
  To ask the Secretary of State for Health what steps he is taking to promote the delivery of sustainable development within Government. [165448]

  Miss Melanie Johnson
  The Department is contributing to the Government's forthcoming consultation on the review of the United Kingdom strategy for sustainable development. One of the aims of the review is to step up action in the delivery of sustainable development.

  The Department also has an important consultation—Choosing Health?—in train to identify action to improve people's health in preparation for a White Paper to be published this summer. Both consultations will have many aims and goals in common and will be an important means of promoting the sustainable development agenda.

  The Department is also leading on cross-Government work on Tackling Health Inequalities: A programme for action, which was published in July 2003 and sets out plans to tackle health inequalities over the next three

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  years; and on developing a Food and Health Action Plan. Taking this work forward will make a significant contribution to the delivery of sustainable development.

  Recycled Paper
  Mrs. Calton
  To ask the Secretary of State for Health if he will list his Department's main suppliers of(a) copier paper, (b) stationery, (c) envelopes and (d) paper for reports; and if he will state (i) the name of each paper used and (ii) the recycled, and post-consumer recycled, content of each paper. [165445]

  Miss Melanie Johnson
  The Department's contracted supplier of copier paper, bulk stationery and envelopes is Guilbert UK. The vast majority of white paper purchased is Niceday 3500, which is 80gsm, 100 per cent. recycled, using 80 per cent. post consumer waste.

  Bulk paper copying is carried out on Xeros "x3" brand paper. This is 100 per cent. post consumer waste recycled.

  NHS Dentistry
  Mr. Evans
  To ask the Secretary of State for Health, how many dentists have been recruited to the NHS in each year since 1997 in the Cumbria and Lancashire Health Authority. [165542]

  Miss Melanie Johnson
  Information on the number of dentists joining the general dental service (GDS) or personal dental service (PDS) in the Cumbria and Lancashire Strategic Health Authority area in each year since 1997 is shown in the table.

  Number of entrants to the GDS and PDS

  Year

  Cumbria and Lancashire SHA

  1998 from 1997

  58

  1999 from 1998

  72

  2000 from 1999

  67

  2001 from 2000

  79

  2002 from 2001

  60

  2003 from 2002

  75

  Notes:

  1. Dentists include principals, their assistants and trainees. Entrants will include some dentists who left dentistry temporarily in previous years.

  2. These figures do not cover other National Health Service dental services, for example, community dental service and hospital dental service.

  Source:

  Dental Practice Board statistics.

  Contraception
  Tim Loughton
  To ask the Secretary of State for Health what evidence he has collated on the percentage of girls who take the contraceptive pill who suffer from (a) weight gain, (b) acne or other skin conditions and (c) mood swings. [165491]

  Miss Melanie Johnson
  Clinical trials for combined oral contraceptives have suggested that mood disturbances occur in around one per cent. of users, while acne, other skin conditions (such as eczema and itching) and weight changes occur in between 0.1 per cent. and 1 per cent. of users.

  Statins
  Mr. Watson
  To ask the Secretary of State for Health what estimate he has made of the number of people being prescribed statins in each year to 2010. [165794]

  Miss Melanie Johnson
  Winning the War on Heart Disease, the 2004 progress report on the national service framework (NSF) for coronary heart disease, reports that statin prescribing continues to rise by around 30 per cent. a year. Nationally, about 1.8 million people are currently receiving statins.

  The Government has made no estimate of numbers of people likely to be prescribed statins in 2010. However, in his 2002 Report Securing Our Future Health: Taking a Long-Term View, Derek Wanless suggested that statins should be prescribed for patients with lower levels of coronary heart disease risk than in the NSF, a 15 per cent. risk over 10 years, as opposed to 30 per cent. in the NSF, and that this would lead to an estimated prescribing cost of £2.1 billion by 2010. The National Institute of Clinical Excellence has been commissioned to produce a technological appraisal of statins and effective prescribing.

  Hypertension
  Mr. Watson
  To ask the Secretary of State for Health what steps his Department are taking to encourage self monitoring of hypertension. [165802]

  Miss Melanie Johnson
  It is essential that individuals across the population be made aware of the risks associated with high blood pressure and the importance of knowing their blood pressure. For the last two years, the Department has contributed to the funding of The Blood Pressure Association's national blood pressure testing week, which is the annual event highlighting their ongoing Know Your Numbers campaign.

  Genetically Modified Food
  Mr. Drew
  To ask the Secretary of State for Health what restrictions are in place to prevent the impact of genetically modified meat and fish and what discussions he has had with retailers on their policy towards these products. [165451]

  Miss Melanie Johnson
  Before any genetically modified food (including GM animals and fish) can be marketed in or imported into the European Union, approval is required under the relevant European Commission legislation. This would include a rigorous Safety assessment of the GM food, which is carried out on a case by case basis.

  The Food Standards Agency has had no discussions with retailers on their policy towards such products.

  Public Health
  Mr. Burstow
  To ask the Secretary of State for Health, pursuant to the answer of 7 January 2004,Official Report, column 396W, which posts are filled by (a) acting staff, (b) temporary staff and (c) staff who fill other posts as directors of public health. [159105]

  Miss Melanie Johnson
  The information requested has been placed in the Library and the previous information has been updated.

  Food Advertising
  Mr. Paul Burstow
  To ask the Secretary of State for Health if he will publish the evidence received by his Department on the impact of the advertising of food to children. [159774]

  Miss Melanie Johnson
  In September 2003, the Food Standards Agency (FSA) published the results of a review that it had commissioned on the effects of food promotion on children's food related behaviour. The review is available on the FSA's website.

  In August 2003, the food advertising unit of the Advertising Association provided the FSA with the report, Advertising and Food Choice in Children: a Review of the Literature, by Dr Brian Young of Exeter University. This report is available on the food advertising unit's website.

  In December 2003, the FSA received from Dr Jason Halford of Liverpool University a pre-publication copy of his paper, The effect of Television Food Advertisments/Commercials on Food Consumption in Children. Dr Halford's paper has since been published in the Journal Appetite.

  Inpatient Waiting Lists by Commissioner for Crosby residents—Waiting list in months

  Year

  Quarter

  Name

  TWL

  0–2 Not seen

  3–5 Not seen

  6–8 Not seen

  9–11 Not seen

  12–14 Not seen

  15–17 Not seen

  1996–97

  4

  Sefton HA

  9,239

  4,046

  2,247

  1,531

  1,166

  246

  3

  1997–98

  4

  Sefton HA

  8,915

  4,204

  1,952

  1,328

  984

  367

  80

  1998–99

  4

  Sefton HA

  7,967

  4,031

  1,634

  1,142

  745

  325

  90

  1999–2000

  4

  Sefton HA

  7,531

  3,603

  1,773

  1,158

  644

  237

  116

  2001–01

  4

  Sefton HA

  7,436

  3,987

  1,638

  971

  455

  278

  107

  2001–02

  4

  Sefton HA

  7,155

  3,837

  1,753

  1,002

  464

  99

  0

  Waiting List in months

  Year

  Month

  Name

  TWL

  0–2 Not seen

  3–5 Not seen

  6–8 Not seen

  9–11 Not seen

  12–14 Not seen

  15–17 Not seen

  2002–03

  March 2003

  South Sefton PCT

  3,917

  2,581

  841

  369

  126

  0

  0

  2003–04

  December 2003

  South Sefton PCT

  3,689

  2,744

  689

  230

  26

  0

  0

  Source:

  Department of Health QF01

  Mrs. Curtis-Thomas
  To ask the Secretary of State for Health how many residents in Crosby awaiting heart surgery have had the option of choosing an alternative hospital for quicker treatment in the last 12 months. [160432]

  Miss Melanie Johnson
  The information requested is not held centrally.

  Health Services (Crosby)
  Mrs. Curtis-Thomas
  To ask the Secretary of State for Health what changes there have been to NHS waiting list time in the last seven years for residents of Crosby. [160392]

  Miss Melanie Johnson
  Information most closely associated with place of residency is not collected on a constituency level, but at a health services commissioner level. Data is shown in the tables for Sefton Health Authority for the period 1997 to 2002 and South Sefton Primary Care Trust for 2003.

  GP Referral to Consultant Waiting List in weeks

  Year

  Name

  Not seen 13 to 25

  Not seen 26 plus

  1997–98

  Sefton HA

  1,936

  243

  1998–99

  Sefton HA

  2,153

  911

  1999–2000

  Sefton HA

  2,241

  883

  2000–01

  Sefton HA

  1,358

  779

  2001–02

  Sefton HA

  1,141

  0

  GP Referral to Consultant Waiting List in weeks

  Month/year

  Name

  13–17 Not seen

  17–21 Not seen

  21–26 Not seen

  26 plus

  March 2003

  South Sefton PCT

  218

  85

  0

  0

  September 2003

  South Sefton PCT

  441

  102

  0

  0

  Source:

  Department of Health QM08R

  Day Cases
  Mrs. Curtis-Thomas
  To ask the Secretary of State for Health what the inpatient pre-booking performance against target was in Crosby for(a) elective inpatients, (b) day cases and (c) outpatients in each year since 1997. [164311]
  423W
  Miss Melanie Johnson
  The Department began publishing national day case figures from March 2003. Data is not collected on inpatient pre-booking performance for elective inpatients or outpatients and is not published on a constituency or National Health Service trust basis.

  Egg Consumption
  Andrew George
  To ask the Secretary of State for Health what the(a) median, (b) highest and (c) lowest consumption of eggs per person in the UK was amongst (i) infants, (ii) children, (iii) young adults and (iv) adults, according to the findings of the National Diet and Nutrition Survey. [162173]

  Miss Melanie Johnson
  Information on the consumption of eggs is published in:

  the National Diet and Nutrition Survey: adults aged 19 to 64 years (volume 1-types and quantities of food consumed) 2002).

  the National Diet and Nutrition Survey: young people aged 4 to 18 years (volume 1-report of the diet and nutrition survey) (2000).

  the National Diet and Nutrition Survey: children aged 1½ to 4½ years (volume 1-report of the diet and nutrition survey) (1995).

  Copies of the reports are available in the Library.

  Creutzfeldt-Jakob Disease
  Mr. Burstow
  To ask the Secretary of State for Health what measures his Department has taken to inform and reassure people who have received blood transfusions since 1980, and will now not be allowed to donate blood, on the risk of vCJD infection. [163473]

  Miss Melanie Johnson
  The National Blood Service (NBS) has produced two leaflets for donors giving them more information about the new donor exclusion criteria. The first leaflet is entitled Variant CJD and blood donation and is a general information leaflet for donors. The second leaflet, entitled Keeping things safe, is for those donors who have received blood since 1 January 1980 in the United Kingdom and can therefore no longer give blood. Copies of these leaflets can be obtained from the NBS website at www.blood.co.uk or from the NBS helpline. Donors will also receive an information leaflet entitled A change to the rules for blood donors with their invitation letter to give blood.

  The NBS has run some press advertising in national newspapers in early April. These adverts addressed why this change is happening, what the risks are and how people can help.

  In addition, any patient who has concerns can contact NHS Direct.

  Mr. Burstow
  To ask the Secretary of State for Health what research is being (a) undertaken and (b) funded by his Department on (i) diagnosis and (ii) treatment of vCJD, and the risks of infection through blood transfusion. [163475]

  Miss Melanie Johnson
  The diagnosis of pre-clinical infection is a major part of the Department's programme of Creutzfeldt-Jakob disease (CJD) related research. There are 13 contracts that are currently being 424W
  funded through the policy research programme. In addition, the Department is currently funding seven projects to asses the risk of transmission through blood, and five projects to develop new therapeutic compounds and the CJD clinical trial. Over £30 million has been committed to date on CJD research.

  Mr. Burstow
  To ask the Secretary of State for Health, whether recipients of blood transfusions after 5 April will be prevented from donating blood. [163476]

  Miss Melanie Johnson
  The new donor exclusion criteria will apply to anyone who has received a blood transfusion since January 1980. This is because there is still a risk that the person from whom the recipient received the blood may have been exposed to variant Creutzfeldt-Jakob Disease by dietary exposure.

  Mr. Burstow
  To ask the Secretary of State for Health how many people have received(a) transfusions of whole blood components and (b) transfusions of other blood products since 1980. [163480]

  Miss Melanie Johnson
  Information on the number of patients who have received blood transfusions or other blood products is not collected centrally. However, the National Blood Service estimates that in recent years, 800,000 patients in England and North Wales received a blood transfusion per annum.

  Nick Harvey
  To ask the Secretary of State for Health what plans he has to extend the ban on blood donations from those who have received a blood transfusion since 1980(a) to organ donation recipients and (b) to prevent recipients of blood transfusions from donating organs; and if he will make a statement. [164280]

  Miss Melanie Johnson
  Individuals who have had an organ transplant ate excluded from giving blood because of their treatment. All potential organ donors are assessed at the time of their death to identify any risk of disease transmission to the donor.

  Accident and Emergency Services
  Mr. Burstow
  To ask the Secretary of State for Health (1) how many consultants there were on average in an accident and emergency department in(a) England and (b) each strategic health authority in each year since 1997; [163503]

  (2) how many consultants there were in each accident and emergency department in England in each year since 1997. [163508]

  Ms Rosie Winterton
  The information requested has been placed in the Library.

  Community Hospitals
  Mr. Boris Johnson
  To ask the Secretary of State for Health how many NHS staff are working in the community hospitals of(a) Townlands, (b) Wallingford, (c) Abingdon, (d) Wantage, (e) Watlington and (f) Didcot; and what proportion of these staff receive financial assistance with regard to (i) housing and (ii) transportation. [164101]

  Ms Rosie Winterton
  Information on number of National Health Service Staff is not held at hospital level but at primary care trust level. Information is shown in
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  the table for South East Oxfordshire and South West Oxfordshire Primary Care Trusts, which commission services from the community hospitals listed.

  NHS hospital and community health services: All NHS staff by main staff group in each specified organisation as at 30 September each specified year

  headcount

  2002

  2003

  South East Oxfordshire PCT total

  515

  567

  Non medical staff total

  249

  266

  of which: Professionally qualified clinical staff total

  120

  138

  Qualified nursing

  115

  132

  Allied health professionals

  2

  3

  Qualified scientific, therapeutic & technical (St&t)

  3

  3

  Support to clinical staff total

  93

  88

  Support to doctors & nurses

  93

  88

  NHS infrastructure support total

  36

  40

  Central functions

  25

  25

  Managers & senior managers

  11

  15

  Medical and dental staff total

  —

  —

  General Practitioners(1)

  65

  66

  Practice Staff

  201

  235

  of which: Practice Nurses

  37

  39

  South West Oxfordshire PCT total

  1,119

  1,103

  Non medical staff total

  607

  589

  of which: Professionally qualified clinical staff total

  305

  280

  Qualified nursing

  305

  280

  Allied health professionals

  8

  —

  Qualified St&t

  13

  5

  Support to clinical staff total

  255

  252

  Support to doctors & nurses

  251

  252

  Support to St&t

  4

  —

  NHS infrastructure support total

  47

  57

  Central functions

  19

  20

  Hotel, property & estates

  2

  3

  Managers & senior managers

  26

  34

  Medical and dental staff total

  —

  1

  General Practitioners1

  129

  138

  Practice Staff

  129

  138

  of which: Practice Nurses

  67

  69

  Notes:

  "—" denotes zero

  (1) All practitioners include GMS Unrestricted Principals, PMS Contracted GPs, PMS Salaried GPs, Restricted Principals, Assistants, GP Registrars, Salaried Doctors (Para 52 SFA), PMS Other, GP Retainers, Flexible Career Scheme GPs and GP Returners.

  Sources:

  Department of Health medical and dental workforce census.

  Department of Health General and Personal Medical Services Statistics.

  Department of Health non-medical workforce census.

  Expert Patients' Programme
  Mr. Burstow
  To ask the Secretary of State for Health if he will make a statement on the expert patient programme; and what plans his Department has to extend the programme. [164869]

  Miss Melanie Johnson
  The expert patients programme provides training in self-management for patients with chronic conditions and helps build informed partnerships between patients and health and social care professionals. The programme is currently being piloted within primary care trusts in England. The report, entitled:The Expert Patient: A New Approach to
  426W
  Chronic Disease Management for the 21st Century, which was published in September 2001, commits us to making the programme integral to mainstream National Health Service healthcare provision between 2004 and 2007.

  Skin Diseases
  Dr. Evan Harris
  To ask the Secretary of State for Health what research his Department has conducted into quality indicators for the treatment and management of inflammatory skin diseases. [164904]

  Miss Melanie Johnson
  In 2001, the National Health Service health technology assessment programme published systematic reviews of treatments for atopic eczema and severe psoriasis. These are available on the programme's website at www.hta.nhsweb.nhs.uk. Further assessments in eczema, psoriasis and acne are in progress.

  Last year, the Nuffield Trust published Measuring general practice: a demonstration project to develop and test a set of primary care clinical quality indicators. The project looked at 19 disease areas, including acne, and was conducted in partnership with the National Primary Care Research and Development center (NPCRDC), based at the University of Manchester. NPCRDC is funded largely by the Department.

  Care Homes
  Mr. Burstow
  To ask the Secretary of State for Health how many outbreaks of infectious disease there were in care homes in each year since 1997. [165241]

  Miss Melanie Johnson
  Information about all outbreaks of infectious diseases in care homes is not collected centrally.

  The Health Protection Agency has provided the information shown in the tables on infectious intestinal diseases and on influenza from their voluntary reporting system.

  General outbreaks of Infectious Intestinal Disease linked to care homes. England & Wales, 1997–2003

  Year

  Number of outbreaks

  1997

  152

  1998

  178

  1999

  167

  2000

  219

  2001

  159

  2002

  331

  2003

  187

  Total

  1,393

  provisional data.

  Source:

  HPA GSURV outbreak database 30/3/04

  Influenza outbreaks reported

  Year

  Number of outbreaks

  1997

  No data available

  1998

  10

  1999

  7

  2000

  1

  2001

  1

  427W

  Influenza outbreaks reported

  Year

  Number of outbreaks

  2002

  1

  2003

  3

  Total

  23

  Source:

  HPA data.

ENVIRONMENT, FOOD AND RURAL AFFAIRS

  Farm Incomes
  Mr. Evans
  To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on farm income levels for farmers in the Ribble Valley and Fulwood in the past five years. [165510]

  Mr. Frank Field
  To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on farm income levels for farmers in Birkenhead in the past five years. [166612]

  Alun Michael
  Owing to the small number of farms in the constituencies of Ribble Valley and Fulwood and Birkenhead, there is no robust data available on farm incomes for farmers in that area over the last five years. Net farm income for farms in the North EU "Super Region" and for England over the last five years are shown in the table below.

  Net Farm Income

  1998–99

  1999–2000

  2000–01

  2001–02

  2002–03

  North EU

  Super Region

  8,272

  8,659

  12,456

  16,457

  18,512

  England

  10,359

  7,981

  9,886

  13.558

  16,435

  Source:

  Farm Business Survey

  Net farm income is the return to the principal farmer and spouse for their manual and managerial labour and to the tenant-type capital of the business.

  Advisory Committee on Pesticides
  Mr. Drew
  To ask the Secretary of State for Environment, Food and Rural Affairs if she will publish the membership for the Advisory Committee on Pesticides; and which organisations are allowed to attend. [166457]

  Alun Michael
  The membership of the Advisory Committee on Pesticides is already published and can be viewed on the Pesticide Safety Directorate's website at http://www.pesticides:gov.uk/acp.asp?id = 203.

  Those who attend the meetings of the committee in addition to its members are departmental assessors and advisors and are listed in the ACP's annual report published at http://www.pesticides.gov.uk/uploadedfiles/Web_Assets/ACP/ACP_annrep_2002.pdf.

  The Committee's annual report for 2003 is in preparation and is expected to be published within the next month.
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  On occasion the Committee invites individuals, such as applicants for approvals, to make a presentation related to a specific item of the committee's business. These individuals are not present when decisions are taken.

  Home Energy Efficiency
  Mr. Field
  To ask the Secretary of State for Environment, Food and Rural Affairs how many homes in Birkenhead have benefited from Warm Front. [166613]

  Alun Michael
  Between the launch of Warm Front in June 2000 and the end of March 2003, approximately 3,780 households in Birkenhead received assistance from the scheme.

  Horses and Ponies
  Andrew George
  To ask the Secretary of State for Environment, Food and Rural Affairs what recent assessment she has made of regulations which affect horses and ponies as(a) food producing, (b) agricultural and (c) pet or companion animals. [166443]

  Alun Michael
  We have been working on revisions to the Horse Passports (England) Regulations 2003, and to European legislation on animal welfare during transport and on veterinary medicines; reviewing national legislation on animal welfare (including regulation of tethering, livery yards and riding establishments); and working with the horse industry to develop a 10-year health and welfare strategy. The Ragwort Control Act, which is part of our work on animal welfare, came into force in February and was accompanied by a regulatory impact assessment. The Act provides for a Code of Practice on the Control of Ragwort, which should be in place towards the end of June. We recently issued the draft Code, and a draft environmental appraisal, for public consultation. Last month we published the first-ever research on the horse industry as a whole, Jointly funded by the Department and the British Horse Industry Confederation.

  Greyhounds
  Phil Sawford
  To ask the Secretary of State for Environment, Food and Rural Affairs, how many greyhounds have bee collected by local authority dog wardens in each year since 2000. [165485]

  Alun Michael
  Under section 149(8) of the Environmental Protection Act 1990, local authority dog wardens are required to keep a register containing the prescribed particulars of, or relating, to dogs seized and the register shall be available, at all reasonable times, for inspection by the public free of charge. However, we do not collect that data centrally as there is no requirement for it to be supplied to Government.

  Rights of Way
  Mr. Streeter
  To ask the Secretary of State for Environment, Food and Rural Affairs what obligations Plymouth City Council has to consult the public over variations to public rights of way; and whether her Department monitors the exercise of such powers. [165911]
  429W
  Alun Michael
  When making changes to a right of way, a local highway authority must, in most cases, (a) serve a notice of the relevant order on every owner, occupier and lessee of any land affected by the order, (b) publish the notice in at least one, local newspaper and (c) notify all statutory consultees. The notice must also be displayed at the ends of the right of way affected by the order. Defra does not monitor the exercise of these duties, but councils are well aware that an order can be challenged if a local highway authority has failed to give correct notice and that it is in their interests to follow the correct procedures.

DEPUTY PRIME MINISTER

  Possession Orders
  Mr. Willis
  To ask the Deputy Prime Minister how many possession orders have been issued in each year since 1997 to (a) elderly and (b) vulnerable people. [166519]

  Mr. Hill
  The Office of the Deputy Prime Minister does not currently collect data on numbers of possession orders issued. Data collected by the Department for Constitutional Affairs and held by the Office of the Deputy Prime Minister on the number of possession orders issued each year since 1997 does not give a breakdown of specified groups of tenants.

  Communications Masts
  Annabelle Ewing
  To ask the Deputy Prime Minister what discussions he and his officials had with (a) Airwave and (b) 02 prior to the setting of the UK's safety limit on Tetra radiation. [161611]

  Yvette Cooper
  None. The Government set up the Independent Expert Group on Mobile Phones (chaired by Sir William Stewart) to consider the health effects of mobile phones, base stations and transmitters. They conducted a rigorous and comprehensive assessment of existing research and gathered a wide range of views and published their report in May 2000. In respect of base stations, the report concludes that"the balance of evidence indicates that there is no general risk to the health of people living near to base stations on the basis that exposures are expected to be small fractions of the guidelines". However, gaps in scientific knowledge led Stewart to recommend a precautionary approach comprising a series of specific measures. The Government accepted the recommended precautionary approach and is taking forward a range of precautionary actions. These include ensuring all base stations meet the international guidelines on public exposure set by the International Commission on Non-Ionising Radiation Protection (ICNIRP).

  Following a request to the NRPB by the Home Office, the issue of possible health effects caused by signals from TETRA base stations was comprehensively addressed in a report by NRPB's independent Advisory Group on Non-ionising Radiation (AGNIR), chaired by Sir Richard Doll. The report on Possible Health Effects from Terrestrial Trunked Radio (TETRA) was published in 2002 in the Documents of NRPB (Volume 12 No 2, 2001) and is also available on the NRPB web site: www.nrpb.org. The report noted that the signals
  430W
  from TETRA base stations, like their mobile phone counterparts, are not pulsed. NRPB advise that there is no reason to believe that signals from TETRA base stations should be treated differently from other base stations.

HOME DEPARTMENT

  Serious Organised Crime Agency
  Mr. Brady
  To ask the Secretary of State for the Home Department how many police officers currently seconded to the National Criminal Intelligence Service will be transferred to the Serious Organised Crime Agency. [166602]

  Caroline Flint
  Staffing levels in the Serious Organised Crime Agency will be determined by the operational outcomes it is funded to deliver; no decisions have yet been taken on the requirements for particular groups of staff, but the overall objective is to enhance the effectiveness of our response to serious organised crime.

  Mrs. Gillan
  To ask the Secretary of State for the Home Department (1) what role the Serious Organised Crime Agency will have in(a) drugs enforcement and (b) drugs policy; [166103]

  (2) what former HM Customs and Excise function he expects the Serious Organised Crime Agency to undertake; [166104]

  (3) how many personnel involved in (a) drug enforcement and (b) drugs policy he expects to be transferred from HM Customs and Excise to the Serious Organised Crime Agency; [166105]

  (4) how many personnel he expects to work on (a) drugs enforcement and (b) drugs policy in the Serious Organised Crime Agency. [166106]

  Caroline Flint
  [holding answer 19 April 2004]: Proposals for the Serious Organised Crime Agency were set out in the white paper "One Step Ahead: A 21st century strategy to defeat organised crime" (CM6167), published on 29 March. A project team is now working on the detailed arrangements, but it is not intended that the new agency will have responsibility for drugs policy.

  Race Hate Websites
  Mr. Hancock
  To ask the Secretary of State for the Home Department, what action he will take to(a) close down race hate websites and (b) protect named journalists who are being targeted by these sites. [160802]

  Fiona MacTaggart
  Websites of this kind are objectionable and I can understand why journalists and other persons identified on them might feel concern.

  Whilst we are keeping the legislative position under review, existing laws already provide a level of protection.

  It is an offence to assault people or damage their property, and a person who behaves in that way or takes active steps to commit those offences is liable to prosecution, regardless of how or where, or on what website he came to identify his victim.
  431W
  It is also an offence to incite another person to commit a criminal offence. While it might not be possible to take action against a foreign-based internet service provider for disseminating the incitement, that would not in itself prevent prosecution of a person in this country who had been responsible for the content of the website. There is, of course, a question about what constitutes incitement. Publishing information such as names and addresses of those belonging to an identified organisation or espousing a particular view may not necessarily be enough in itself to constitute incitement but it is for the police and prosecutors to decide in all the circumstances of a particular case and on the available evidence whether an offence has been committed.

  The Protection from Harassment Act 1997 makes provision that a person may be guilty of an offence if he engages in a course of conduct which he knows or ought to know causes harassment. The Act is concerned with the effect of the behaviour rather than the type of conduct—any actions that foreseeably cause distress may amount to harassment. The Act also provides, as a civil remedy, the opportunity to apply to the High Court for an injunction. Victims of harassment by animal rights extremists have successfully used the Act to secure orders which, among other things, have required the removal of their personal details from websites. In these cases however acts of harassment beyond identifying persons on a website were proved.

  The internet service provider industry itself is sometimes able and willing to refuse to carry objectionable material on websites. In the UK, most service providers have acceptable use policies, under which they reserve the right to remove a customer's material, or refuse to carry it, not only if it is illegal but also in certain other circumstances, which can include where material causes concern or needless anxiety to others or publishes details of individuals without their consent. The UK's Internet Watch Foundation encourages service providers to refuse to handle sites which violate their acceptable use policies. The great majority of UK service providers operate responsibly. The government has also discussed with other governments how we can co-operate to tackle this problem, given that it raises issues of cross-national jurisdication.

  It is important that those with concerns should make them known to the police and to the Internet Watch Foundation.

  Probation Hostels
  Mr. Hancock
  To ask the Secretary of State for the Home Department what the average percentage change in costs was for each probation hostel following the decision to award the contract for hostel facilities to the private sector between the last and current financial years. [160808]

  Paul Goggins
  Prior to the award of the approved premises (previously known as hostels) facilities management contract no consistent data on the cost of running each premises was held. Therefore, it is not possible to accurately compare current costs to historic costs.
  432W
  Reflecting the enhanced specification, and the intention to improve the quality of the approved premises estate, including staff security and health and safety, funding for premises was increased by 10 per cent. for financial year 2003–04.

CULTURE, MEDIA AND SPORT

  "Choosing Health?"
  Mr. Don Foster
  To ask the Secretary of State for Culture, Media and Sport whether her Department will make a formal response to the recommendations of the Treasury's recent report on Securing Good Health for the Whole Nation: and if she will make a statement. [165008]

  Miss Melanie Johnson
  I have been asked to reply.

  The Department of Health launched "Choosing Health? A consultation on action to improve people's health" on 3 March. The formal consultation period runs until 28 May 2004. The consultation will feed into a White Paper, to be published this summer. The White Paper will set out what the Government will do to achieve change in the public sector and in partnership with other organisations to improve health, and will include the Government's response to Derek Wanless' report on Securing Good Health for the Whole Population.

  Digital Television
  Mr. David Hamilton
  To ask the Secretary of State for Culture, Media and Sport what assessment she has made of accessibility to digital television in(a) Scotland, (b) England, (c) Wales and (d) Northern Ireland. [165677]

  Estelle Morris
  [holding answer 19 Apri1 2004]: Nearly three-quarters of the UK population are currently believed to have a full range of digital terrestrial television (DTT) services potentially available. Current estimates, provided by the BBC, of the coverage of DTT services in the nations are:

  England: 73 per cent.

  Scotland: 82 per cent.

  Wales: 57 per cent.

  Northern Ireland: 58 per cent.

  Digital satellite signals are potentially available to almost all UK viewers, and may offer an alternative in areas where DTT signals are not available. Cable TV services are also available to more than half the UK population (primarily in urban areas).

  Full details, including maps of the extension of DTT coverage which may be possible after digital switchover by re-using analogue TV frequencies and increasing transmission powers, are available in Ofcom's report 'Driving Digital Switchover'.

  Green Minister
  Mr. Don Foster
  To ask the Secretary of State for Culture, Media and Sport what work her Department's Green Minister has undertaken in the last three months
  433W
  in that capacity; and what meetings her Department's Green Minister has attended in the last 12 months in that capacity. [165955]

  Estelle Morris
  In February, as the Green Minister for DCMS I endorsed the publication of my Department's strategy for sustainable development, copies of which have been placed in the Library of the House. In the spirit of strengthening links for sustainable development between departments, as recommended by my colleague the Minister for Environment, I recently issued an invitation to ministers across Government to attend an informal discussion on how our various departments relate to the subject. This will take place in the Royal Parks' newly opened restaurant in St James's Park, during London Sustainability Weeks in June. The restaurant has a modern ecological design constructed from sustainably produced materials (larch, oak) and has a green turf roof. The food it serves is procured as far as possible from named small specialist English producers, and will be organic, British and seasonal. It will present information on the ingredients used in an educational, fun and original way.

  Helen Jackson
  To ask the Secretary of State for Culture, Media and Sport what criteria she used for making the selection of 20 sports eligible for main Lottery funding; if she will list the 20 sports selected for Lottery funding; and whether crown green bowling was considered as a sport which might be eligible for main Lottery funding. [166798]

  Richard Caborn
  The 20 sports eligible for priority lottery funding were selected by Sport England. The selection criteria were participation rates, retention, and levels of success. Sport England also considered the governance of each sport. Any sports can apply for lottery funding.

  DCMS Gender, Ethnicity and Disability Breakdown by Grade

  Ethnicity

  Disability

  Total staff in Grade

  Female

  Non-White

  Not Declared

  Disability Declared

  Not Declared

  AA/AO

  104

  67

  21

  13

  6

  11

  EO

  119

  64

  18

  8

  *

  14

  HEO/SEO

  152

  69

  12

  22

  *

  24

  Grade 7

  90

  35

  *

  8

  *

  14

  SCS

  25

  6

  *

  *

  0

  *

  * Fewer Than 5

  DCMS Age Breakdown by Grade

  25

  25–29

  30–34

  35–39

  40–44

  45–49

  50–54

  55 +

  AA/AO

  29

  19

  11

  16

  8

  5

  4

  12

  EO

  7

  32

  23

  20

  14

  10

  6

  7

  HEO/SEO

  2

  27

  22

  40

  31

  10

  15

  5

  Grade 7

  0

  7

  7

  15

  23

  14

  12

  12

  SCS

  0

  0

  0

  5

  4

  5

  8

  3

  Royal Parks Agency Gender, Ethnicity and Disability Breakdown by Grade

  Ethnicity

  Disability

  Total staff in Grade

  Female

  Non-White

  Not Declared

  Disability Declared

  Not Declared

  AA/AO

  145

  51

  6

  33

  0

  0

  EO

  53

  17

  *

  12

  *

  0

  HEO/SEO

  30

  8

  *

  *

  *

  0

  434W
  The Priority sports are:

  England only: badminton, cricket, football, golf, hockey, netball, rugby union, rugby league, squash and tennis.

  UK-wide (same treatment by Sport England, but also qualify for UK Sport One Stop Planning support: athletics. canoeing, cycling, equestrianism, gymnastics, judo, rowing, triathlon, sailing and swimming).

  Crown green bowling was considered for priority funding. However, in comparison to the 20 sports chosen, there is less overall participation in numbers and diversity.

  There is no reason why crown green bowling should not successfully apply for individual project lottery funding. Applications should be made to the new Regional Sports Boards that have been established to ensure that funding meets local and regional needs.

  Civil Servants
  Bob Spink
  To ask the Secretary of State for Culture, Media and Sport if she will list for each civil service grade within her(a) Department and (b) Department's executive agencies, the total number of staff employed, broken down by (i) gender, (ii) ethnic group, (iii) registered disabled and (iv) age group. [166397]

  Richard Caborn
  The Department and Royal Parks Agency collect data on ethnicity and disability on the basis of voluntary self-declaration. The tables provide data by grade broken down by (i) gender, (ii) ethnic group, (iii) disability and (iv) age group. The Department and Agency Codes of Practice on equal opportunities monitoring do not allow disclosure of data where numbers in any group are fewer than five; where this is the case data have been aggregated to maintain confidentiality.
  435W

  Royal Parks Agency Gener, Ethnicity and Disability Breakdown by Grade

  Ethnicity

  Disability

  Total Staff in Grade

  Female

  Non-White

  Not Declared

  Disability Declared

  Not Declared

  Grade 7

  10

  *

  0

  0

  0

  0

  SCS

  2

  0

  0

  0

  0

  0

  * Fewer Than 5

  Royal Parks Agency Breakdown by Grade

  Age Breakdown

  5

  25–29

  30–34

  35–39

  40–44

  45–49

  50–54

  55 +

  AA/AO

  8

  13

  22

  29

  30

  20

  11

  12

  EO

  1

  0

  9

  14

  5

  11

  6

  7

  HEO/SEO

  0

  1

  2

  7

  4

  7

  4

  5

  Grade 7

  0

  0

  0

  1

  1

  5

  0

  3

  SCS

  0

  0

  0

  0

  0

  0

  2

  0

DEFENCE

  Electronic Payments
  Mr. White
  To ask the Secretary of State for Defence what progress his Department has made ot manage the changeover from the Bank Automated Clearing System to the new BACSTEL-IP system for electronic payments.

  Ivor Caplin
  Action to manage the changeover to the new BACSTEL-IP system is being co-ordinated in the Ministry of Defence by the Defence Communications Services Agency, supported by the Departmental Corporate Banking and Fund Manager and by Lloyds TSB, the sponsoring bank for BACS within the Department. Initial work to gather information has been conducted, and a plan prepared to enable migration well ahead of the discontinuation of the existing BACS system.

  Dr. Lynne Jones
  To ask the Secretary of State for Defence (1) what alternative methods of payment he is proposing for people who currently receive a war pension by order book, girocheque or payable order but will be unable to transfer to direct payment. [165214]

  (2) who will be eligible to receive their war pension by methods other than direct payment. [165215]

  Ivor Caplin
  The Veterans Agency (VA) has always accepted that for a very limited number of customers, those most vulnerable and genuinely unable to manage Direct Payment, this method of payment may not be practical or suitable for their needs.

  For those customers the VA will provide an alternative method of payment that will take the form of a weekly cheque. This will be sent to the pensioner's home by first class post and they will be able to cash it at any post office.

  Departmental Personnel (Vale of York)
  Miss Anne McIntosh
  To ask the Secretary of State for Defence how many (a) service and (b) departmental civilian personnel are based in the Vale of York. [165095]

  Ivor Caplin
  Location data for Service personnel are not available by Parliamentary Constituency. However they are available by Local Authority Area. The Parliamentary Constituency of the Vale of York 436W
  contains part of the Unitary Authority of York, and parts of the local authorities of Hambleton and Harrogate. The total number of Service personnel in these areas as at 1 July 2002 (the most recently available data) is given in the following table:

  UA/LA

  All Services

  Naval Service

  Army

  RAF

  York

  680

  —

  680

  —

  Hambleton

  2,130

  10

  700

  1,420

  Harrogate

  2,610

  60

  2,530

  10

  Note:

  1. — denotes zero,

  2. All figures have been rounded to the nearest 10. Due to rounding methods used totals may not always equal the sum of the parts.

  3. Figures are for UK Regular Forces, both Trained and Untrained, and exclude Gurkhas, Full-Time Reserve Service personnel, the Home Service battalions of the Royal Irish Regiment and mobilised Reservists.

  The number of civilian personnel working for the Ministry of Defence as at 1 January 2004 in Yorkshire and The Humber was 3,140 (rounded to the nearest 10).

  This includes permanent, full-time equivalent staff, non-industrial and industrial, including Trading Funds and excludes those on career breaks, long-term sick leave, secondment etc. Reliable data is not available below Government Office Region level.

  Civilian Personnel
  Mr. Rosindell
  To ask the Secretary of State for Defence what the sal iry bill was for civilians employed within the (a) Ministry of Defence and (b) armed forces in the latest year for Nhich figures are available. [165554]

  Ivor Caplin
  Civilian salary costs, including National Insurance contributions, superannuation liability and redundancy and severance payments, for the last Financial Year 2002–03 were £2,584,057,000. This information was published in the Department's Annual Reports and Accounts at Note 2.2 to the acccounts. A copy is available in the Library of the House.

  Army Resettlement Payments
  Mr. Dodds
  To ask the Secretary of State for Defence, how many (a) soldiers and (b) ex-soldiers were (i) investigated and (ii) prosecuted in regard to fraudulent claims for payment associated with resettlement in each year since 2000. [166436]
  437W
  Ivor Caplin
  Information for all soldiers is not held centrally and could only be provided at disproportionate cost. The investigation of ex-soldiers is a matter for the appropriate civil police authority.

  Mr. Dodds
  To ask the Secretary of State for Defence, how many soldiers received payments as part of their resettlement on leaving the Army in 2003; and what the average amount was. [166437]

  Ivor Caplin
  The Information requested is not held centrally and could only be provided at disproportionate cost.

  Cap Badges
  Bob Russell
  To ask the Secretary of State for Defence if he will list the regiments which have the name of a county included in the cap badge. [166028]

  Ivor Caplin
  The following 11 regular Army regiments include the name of a county in their official titles: The Argyle and Sutherland Highlanders; The Cheshire Regiment; The Devon and Dorset Regiment; The Prince of Wales's Royal Regiment (Queen's and Royal Hampshires); The Green Howards (Alexandra, Princess of Wales's Own Yorkshire Regiment); The Prince of Wales's Own Regiment of Yorkshire; The Queen's Lancashire Regiment; The Royal Gloucestershire, Berkshire and Wiltshire Regiment; The Staffordshire Regiment; The Worcestershire and Sherwood Foresters Regiment; and The Duke of Wellington's Regiment (West Riding).

  Of these 11 regiments, five feature the name of a county in their actual gap badges. They are: The Argyle and Sutherland Highlanders; The Cheshire Regiment; The Prince of Wales's Own Regiment of Yorkshire: The Queen's Lancashire Regiment; and The Duke of Wellington's Regiment (West Riding).

  Wind Turbines, Guestwick
  Mr. Keith Simpson
  To ask the Secretary of State for Defence whether he intends to object, for operational flying reasons, to the erection of six wind turbines at Guestwick in Norfolk. [166043]

  Ivor Caplin
  (holding answer 19 April 2004): An objection to the current proposals will be lodged on the basis of potential interference with the operation of both air traffic and air defence radar. The developer has been notified.

  The main reasons are that the proposed development is situated within 22km and in line of sight of the Air Traffic Radar at RAF Coltishall and within 16km and line of sight of the radar at RAF Honington. The blades of wind turbines can produce false returns or mask the detection of flying aircraft. It is the view of our specialist technical advisers, who have considered the proposal,
  438W
  that such a development could place the safety of flight in danger and therefore pose an unacceptable risk to personnel, aircraft and people on the ground.

  In addition the site lies within 27km and line of sight of the Air Defence Radar at RAF Trimingham.

  However, officials from Defence Estates are discussing with the developer whether any mitigating measures might be possible which would allow a development to proceed.

  Computer Services
  Bob Spink
  To ask the Secretary of State for Defence what plans he has to update computer (a) hardware and (b) software standard packages used in his Department. [166369]

  Ivor Caplin
  The Defence Information Infrastructure Integrated Project Team (DII IPT) will deliver 139,000 desktop devices across Defence. This will include the provision of standard personal productivity software, e.g. office automation. The DII (Future) Programme will be delivered incrementally commencing during 2005 and is expected to achieve a Full Operating Capability by 2009.

CABINET OFFICE

  Disclosure of Information
  Mr. Heath
  To ask the Minister for the Cabinet Office in what circumstances is disclosure of Government policy to a third party considered a disciplinary offence. [166194]

  Mr. Alexander
  The rules on the disclosure of information by civil servants are set out in the Civil Service Code and Civil Service Management Code.

  Regulatory Reform
  Mr. Lazarowicz
  To ask the Minister for the Cabinet Office what steps he is taking to improve the regulatory reform process. [166195]

  Mr. Alexander
  As I confirmed to the Regulatory Reform Committee on 1 July 2003, we will honour the commitment given during the passage of the Regulatory Reform Bill in another place to review the workings of the order-making process in April 2004.

  Regulatory Impact Assessments
  Mr. Norman
  To ask the Minister for the Cabinet Office what plans he has to improve the monitoring of regulatory impact assessments. [166196]

  Mr. Alexander
  My right hon. Friend the Chancellor announced in the Budget on 17 March new processes for approving regulatory proposals likely to impose large additional costs on businesses.

  These new arrangements mean that departments will need to agree regulatory impact assessments on major proposals with the Cabinet Office Regulatory Impact

TREASURY

  Tax Credits
  Geraldine Smith
  To ask the Chancellor of the Exchequer how many people have received overpayments of tax credits in the last 12 months. [165419]

  Dawn Primarolo
  I refer my hon. Friend to the reply I gave my hon. Friend the Member for Jarrow (Mr Hepburn) on 22 March,Official Report, columns 663–64W.

  Geraldine Smith
  To ask the Chancellor of the Exchequer what problems there have been with the tax credit computer system. [165420]

  Dawn Primarolo
  I refer my hon. Friend to the reply I gave the hon. Member for Birmingham, Northfield (Mr Burden) on 8 December 2003,Official Report, columns 334–35W.

  Mr. Ruane
  To ask the Chancellor of the Exchequer how many claimants of child tax credit there are; and what the total funding was for 2003–04 for each(a) constituency and (b) region in the United Kingdom. [166672]

  Dawn Primarolo
  There were 4.6 million families with an award of Child Tax Credit on 5 January this year. Because Child Tax Credit is a national system of financial support there is no separately identifiable funding for each constituency and region of the UK. However, data on the number of families receiving Child Tax Credit in each constituency and region is available on the Inland Revenue's website, at: http://www.inlandrevenue.gov.uk/stats/personal-tax-credits.

  Illegal Imports
  Mr. Breed
  To ask the Chancellor of the Exchequer how many successful prosecutions have been brought against illegal(a) meat and (b) produce importers in the past five years, broken down by port of entry. [165718]

  Mr. Healey
  HM Customs and Excise have been responsible for anti-smuggling controls on illegal imports of meat since April 2003.

  Customs have brought two successful prosecutions against people smuggling illegal meat in the past fortnight: one involving an American national arriving at Gatwick airport and another a Gambian national arriving at Heathrow.

  In the past five years, two other successful prosecutions have been brought by Customs in regard of imports of meat, skins and dead animals (both in 2001). Records detailing the ports of entry and details of relevant prosecutions brought by local authorities are not recorded centrally.

  There have been no prosecutions with regard to illegal imports of produce in the past five years.

  National Minimum Wage
  Mr. Hepburn
  To ask the Chancellor of the Exchequer what provisions are being made to ensure that(a) post-GCSE students taking summer jobs and (b) sixth formers with Saturday jobs are covered by the new minimum wage for 16 and 17 year olds. [166814]
  440W
  Dawn Primarolo
  The new minimum wage rate will cover all 16 and 17 year olds who have ceased to be of compulsory school age, with an exemption for apprentices and those engaged in specified pre-apprenticeship training programmes. The Government will bring in regulations to implement the new minimum wage rate before Parliament ahead of the Summer recess and the new rate will come into effect on 1 October. The DTI is considering how best to raise awareness of the new minimum wage among 16 and 17 year olds and their employers.

WALES

  Inward Investment
  Bill Wiggin
  To ask the Secretary of State for Wales which business sectors in Wales attracted the highest(a) number of investors and (b) amount of investment in each year since 1999. [161203]

  Mr. Touhig
  Since 1999, the following business sectors have attracted the highest number of investors in Wales:

  Year

  Business Sector

  Number of investors

  1999–2000

  Call centers

  11

  2000–01

  Other manufacturing

  11

  2001–01

  Ebusiness

  10

  2001–02

  Automotive

  9

  2002–03

  Other manufacturing

  11

  Since 1999, the following business sectors have attracted the highest amounts of investment in Wales:

  Year

  Business Sector

  Amount invested

  1999–2000

  Other manufacturing

  £334.8m

  2000–01

  Automotive

  £299.9m

  2001–01

  Semconductors

  £69.4m

  2001–02

  Other manufacturing

  £209.5m

  Source:

  Welsh Development Agency

  NB— "Other manufacturing" are those projects which fall outside the above categories. For exmaple, it excludes aerospace, automotive, construction products, electrical engineering, general engineering, etc.

  Employment
  Bill Wiggin
  To ask the Secretary of State for Wales how many jobs have been lost in(a) manufacturing and (b) agriculture in Wales in each year since 1997. [163166]

  Mr. Touhig
  Between 1997 and 2003, on average 19,000 jobs were lost each year in manufacturing and 14,000 manufacturing jobs created. The decline in the manufacturing sector is more than balanced by a rise in overall employment in Wales which has risen by over 100,000 since 1997. Details for individual years for the manufacturing sector are as follows:

  Year

  Gains (thousands)

  Losses (thousands)

  1997

  11.2

  10.5

  1998

  17.2

  19.0

  1999

  10.0

  15.0

  2000

  13.1

  17.6

  2001

  24.9

  30.1

  441W

  Year

  Gains (thousands)

  Losses (thousands)

  2002

  12.8

  22.9

  2003

  9.0

  20.0

  1997–2003 averages

  14

  19

  Source:

  Welsh Register of Manufacturing Employment

  Information for the agriculture sector is not available in the form requested. However, employment trends in agriculture are set out in the table below.

  Persons Employed in Agriculture in Wales (thousands)

  Year

  1997

  63.3

  1998

  61.9

  1999

  59.5

  2000

  55.7

  2001

  56.3

  2002

  56.2

  2003

  55.6

  Source:

  Digest of Wales Historical Statistics

NORTHERN IRELAND

  Murder Defendants (Bail)
  Mr. Nigel Dodds
  To ask the Secretary of State, Northern Ireland Office how many times defendants charged with murder in Northern Ireland have been released on bail in each year since 2000. [166440]

  Mr. Christopher Leslie
  I have been asked to reply.

  In 2001, 13 defendants on murder charges were released on bail.

  In 2002, 17 defendants on murder charges were released on bail.

  In 2003, 14 defendants on murder charges were released on bail.

SCOTLAND

  Focus Groups and Opinion Polls
  Mr. Laws
  To ask the Secretary of State for Scotland what his estimate is of total expenditure by his Department on(a) focus groups and (b) opinion polls in each year from 1995–96 and 2003–04; and if he will make a statement. [162758]

  Mrs. McGuire
  The Scotland Office was established on 1 July 1999. Since then there has been no expenditure on focus groups or opinion polls.

  Press Officer
  Mr. Laws
  To ask the Secretary of State for Scotland how many press officers were employed in his Department in each year from 1990–91 to 2003–04; what the total cost was in each year; and if he will make a statement. [162846]
  442W
  Mrs. McGuire
  The Scotland Office was established on 1 July 1999. Details of the number of press officers and their total pay cost to the office (including superannuation and employers national insurance contributions) are given in the table below:

  Year

  Number of Press Officers

  Cost £

  1999–2000

  4

  1,244,078

  2000–01

  4

  139,705

  2001–02

  4

  134,702

  2002–03

  4

  299,166

  2003–04

  2.6

  3111,202

  1 Part year cost from 1 July 1999

  2 Part year cost because of vacancies

  3 Estimated

  Computers
  Steve Webb
  To ask the Secretary of State for Scotland how many cases of computer misuse there were in his Department in each of the last seven years, broken down by category of misuse; and how many of those cases resulted in disciplinary action. [163228]

  Mrs. McGuire
  The Scotland Office was established on 1 July 1999. Since then there have been no cases of computer misuse in the office.

  Civil Servants
  Bob Spink
  To ask the Secretary of State for Scotland what the requirements are on officials in his Office to declare current interests; and what register of interests is kept for his officials. [164713]

  Mrs. McGuire
  The Civil Service Management Code sets out the requirement for civil servants declaring any conflict of interest. Further information and guidance to staff on the declaration of interests is available from the Staff Handbook.

  Accountancy Services
  Mr. Cousins
  To ask the Secretary of State for Scotland what the(a) nature and (b) value was of all contracts, consultancies or other services placed with the accountancy firms (i) Deloitte & Touche, (ii) Ernst & Young, (iii) KPMG and (iv) PricewaterhouseCoopers since 2000–01 by the Department. [166083]

  Mrs. McGuire
  The Scotland Office has had no contracts, consultancy or other service work carried out by these accountancy firms.

  Staff Transferrals
  Mr. Peter Duncan
  To ask the Secretary of State for Scotland how many staff from his Office have transferred to other Government departments since 1 June 2003; and to which departments they have transferred. [165965]

  Mrs. McGuire
  Since 1 June 2003, three staff have transferred from the Scotland Office to the Office of the Deputy Prime Minister, the Wales Office and the Department for Constitutional Affairs respectively. In
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  addition. 28 staff have returned to their parent departments (primarily the Scottish Executive) after their period of loan.

  Mr. Peter Duncan
  To ask the Secretary of State for Scotland how many staff from other Government departments have transferred to his Office since 1 June 2003; and from which departments they have transferred. [165966]

  Mrs. McGuire
  Since 1 June 2003, nine members of staff have joined the Scotland Office on loan from the Scottish Executive.

  Higher Education
  Mr. Lazarowicz
  To ask the Secretary of State for Scotland what steps he will take in response to the findings and recommendations of the Scottish Executive's Phase 3 Higher Education Review. [165959]

  Mrs. McGuire
  Higher Education in Scotland is a devolved matter. It is therefore for Scottish Ministers to consider the findings of the 3rd Phase Scottish Higher Education Review to inform the 2004 Spending Review.

WORK AND PENSIONS

  Pensions and Benefits (Direct Payments)
  Mr. Hancock
  To ask the Secretary of State for Work and Pensions how many pensioners in the Portsmouth South constituency drew their(a) benefits including war pensions and (b) retirement pensions at (i) post offices and (ii) banks and building societies, in each of the last three years for which figures are available. [165353]

  Chris Pond
  The information is not available in the format requested. However, information available on pensioners (women over 60 and men over 65) as at 31 December 2002 and 31 December 2003 in the Portsmouth South constituency receiving benefit payments collectable at a post office and by direct payment into bank and building society accounts, is in the tables.

  Other Benefit accounts as at December each year in Portsmouth South Constituency

  Payments into Bank/ Building Society Accounts

  Payments through Post Office

  December 2002

  3,995

  9,330

  December 2003

  5,725

  8,045

  Reitrement Pension accounts as at December each year in Portsmouth South Constituency

  Payments into Bank/ Building Society Accounts

  Payments through Post Office

  December 2002

  5,790

  6,640

  December 2003

  6,135

  5,410

  Included in payment through the post office are customers paid into Post Office card accounts and customers paid by girocheque. Girocheques are encashable either at a post office or they can be paid into
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  a bank or building society account. These figures do not include war pensions and child benefit customers as these accounts are the responsibility of the Ministry of Defence and Inland Revenue respectively.

  Some customers who are paid direct into an account can also collect their payments in cash at post offices through the wider range of banking services now available at the post office. There is no data available on the number of benefit claims collected in this way.

  Bob Spink
  To ask the Secretary of State for Work and Pensions what the take up of direct payment has been. [166230]

  Chris Pond
  Key figures on the progress of conversion to Direct Payment are available in the Library, updated every four weeks.

  Sandra Gidley
  To ask the Secretary of State for Work and Pensions (1) to how many benefit claimants the Department has sent personal invitation letters to open a Post Office Card Account; and how many of these are in receipt of state pensions; [166011]

  (2) how many benefit claimants have completed the Post Office Card Account application forms at post offices; and how many of these are in receipt of state pensions; [166012]

  (3) how many benefits claimants are being paid by the Department directly into Post Office card accounts; and how many of these are pensioners. [166082]

  Chris Pond
  Key figures on the progress of conversion to Direct Payment are available in the Library, updated every four weeks.

  Post Office Limited have advised that as at 31 March 2004 over 2.1 million Post Office card accounts had been opened. The Post Office does not break these figures down into individual benefit groups therefore specific data for pensioners is not available.

  The number of Department for Work and Pensions benefit accounts being paid into a Post Office card account as at 20 March 2004 is 679,355 of which 172,345 are Retirement Pension accounts.

  As many customers have already provided their account details it is expected that the figures for Direct Payment into Post Office card accounts will quickly rise, as customers existing methods of payment expire, and they move over to payment being made direct into their nominated account.

  Mr. Edward Davey
  To ask the Secretary of State for Work and Pensions how many staff are employed by his Department to call members of the public who have yet to sign up for electronic payment of their benefits into bank or Post Office accounts. [165709]

  Chris Pond
  The conversion process normally consists of one or more mailings sent directly to the customer, followed by a phone call if there is no response to the letter(s). If the customers' telephone number is not available then a further letter asking them to contact the Department may be issued.

  Approximately 150 of the staff employed by the Customer Conversion center are involved in making outbound calls. This is just part of the range of tasks undertaken by the Customer Conversion center aimed

  445W
  at assisting over 14 million customers to convert to Direct Payment before order books are phased out in 2005.

  New Deal for Lone Parents
  Mr. Field
  To ask the Secretary of State for Work and Pensions (1) how many women in Birkenhead have benefited from the (a) New Deal for Lone Parents and (b) New Deal for Partners since 1997; and if he will make a statement; [166508]

  (2) how many lone parents in Birkenhead have gained work through the New Deal programme. [166511]

  Jane Kennedy
  The New Deal is working. Over one million people have been helped into work since its inception. On New Deal for Lone Parents alone there have been almost 460,000 entrants to the programme and over 240,000 of the lone parents participating have found work.

  Statistics for New Deal for Partners are not available at constituency level. The information requested on the number of women benefiting from New Deal for Lone Parents is in the table.

  Number of Women Participating in New Deal for Lone Parents in Birkenhead

  Number of New Deal Participants1

  Number of New Deal Starts 2

  1,310

  1,630

  Source:

  New Deal evaluation Database, Information and Analysis Directorate, DWP.

  Notes:

  1 All figures relate to individuals who have started each programme.

  2 An individual may have had more than one start over the period.

  Seven Hundred and Forty lone parents have gained work through the New Deal for Lone Parents in Birkenhead. Information on the family circumstances of the participants of other New Deals is not available.

  Mr. Chapman
  To ask the Secretary of State for Work and Pensions how many lone parents in Wirral South have gained work through the New Deal programme. [166632]

  Jane Kennedy
  210 lone parents have gained work in Wirral South through New Deal for Lone Parents.

  Information on how many lone parents have gained work through other New Deal progammes is not available.

  Mr. Willetts
  To ask the Secretary of State for Work and Pensions (1) if he will break down by geographical area the information given in the latest Office of National Statistics' Statistics on the New Deal immediate destinations of people leaving the New Deal for Young People (Table 4) and the enhanced New Deal 25 plus (Table 5); [166351]

  (2) in the latest Office of National Statistics' statistics on the New Deal, if he will break down by benefit to which individuals moved, the information given in the
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  column on transfers to other benefits in Table 5 of the Immediate Destination on leaving the enhanced New Deal 25 plus; [166379]

  (3) if he will break down by benefit to which individuals moved, the information given in the column on other benefits in Table 4 of the Immediate Destination on leaving the New Deal for Young People in the latest Office of National Statistics's Statistics on the New deal. [166380]

  Jane Kennedy
  [holding answer 19 April 2004]: Latest information on the immediate destinations of people leaving New Deal for Young People and New Deal 25 plus, broken down by Jobcenter Plus region, has been placed in the Library.

  A further breakdown of immediate destinations on leaving New Deal for Young People and New Deal 25plus is not available. Work is currently underway examining our data sources and systems, exploring the possibility of linking these to provide information such as that requested.

  Pensioner Incomes
  Mr. Webb
  To ask the Secretary of State for Work and Pensions if he will estimate for (a) 1979, (b) 1996–97 and (c) 2002–03 the number of individual pensioners living in households with income below 60 per cent. of median income after housing costs; and of these how many were (i) men and (ii) women. [166250]

  Malcolm Wicks
  The requested information is provided in the table.

  Number of pensioners (millions) living below 60 per cent of contemporary median income (After Housing Costs)

  Year

  Male

  Female

  All Pensioners

  1979

  0.9

  1.6

  2.5

  1996–97

  0.8

  1.9

  2.7

  2002–03

  0.8

  1.3

  2.2

  Notes:

  All figures are estimates and are taken from the Households Below Average Income (HBAI) series. Family Expenditure Survey (FES) data is used for 1979, while Family Resource Survey data is used for 1996–97 and 2002–03. FES figures relate to single calendar years whereas FRS figures are for single financial years.

  Comparisons between results for 1979 and those for the later years should be regarded as approximate, due to the change in data source and grossing regime.

  Estimates are for Great Britain and are quoted to the nearest 0.1 million. Totals for male and female pensioners may not add up to 'All pensioners' due to rounding.

  The estimates are sample counts, which have been adjusted for non-response using milti-purpose grossing factors that, in the case of the Family Resources Survey, control for tenure, Council Tax band and a number of other variables. Estimates are subject to both sampling error and to variability in non-response.

  The income measure used is weekly net (disposable) equivalised household income (that is to say income that is adjusted to reflect the composition of the household). Figures are quoted on an After Housing Costs basis, and include the self-employed.

  Caution should be taken when making comparisons between gender using HBAI data. HBAI attempts to measure living standards as determined by household income; consequently both partners in a couple will appear at the same

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  position in the income distribution. Any differences in figures can only be driven by gender differences for single adults, which will themselves be diluted by the figures for couples.

  Chemical Leak (Rhodia)
  Mr. Holmes
  To ask the Secretary of State for Work and Pensions when he expects the Health and Safety Executive to report on the chemical leak of 3 November 2003 at the Rhodia Group Chesterfield site; and if he will make a statement. [165641]

  Jane Kennedy
  HSE will be completing its investigation into the chemical release at Rhodia in the next few weeks, and then determining what further action it will take. I have asked the Health and Safety Executive to keep you informed of developments on this matter, and as to what means of public reporting will be used.

  Pensioner Benefits
  Mr. Willetts
  To ask the Secretary of State for Work and Pensions what the assumptions on uprating of benefit, referred to in Note 5 to the Answer of 3 November 2003,Official Report, columns 470–2W, on pensioners' benefits, were. [166647]

  Maria Eagle
  The current policy on uprating of Disability Living Allowance (DLA), Attendance Allowance (AA) and Carers' Allowance (CA), to which I referred in note 5 to the written answer I gave to the hon Member on 3 November 2003,Official Report, columns 470–2W, is that these benefits are uprated in April each year in line with the movement of the Retail Prices Index (RPI) over the 12 months to the previous September. This policy is applied when estimating expenditure on these benefits for future years, using the latest HM Treasury medium term assumptions for the annual movement of the RPI up to 2006–07, and an assumption of an annual movement of the RPI equal to 2.58 per cent for the long term (beyond 2006–07).

FOREIGN AND COMMONWEALTH AFFAIRS

  Iraq
  Sir John Stanley
  To ask the Secretary of State for Foreign and Commonwealth Affairs on what date he was first informed that the former deputy legal adviser in his Department, Ms Elizabeth Wilmhurst, did not agree that the use of force against Iraq was lawful. [165684]

  Mr. Straw
  [holding answer 19 Apri12004]: We do not comment on individual cases or any legal advice individual officials may have given. Information concerning Government legal advice is exempt from disclosure under exemptions 2 and 4(d) of Part 2 of the Code of Practice on Access to Government Information.

  Immigration
  Mr. Lidington
  To ask the Secretary of State for Foreign and Commonwealth Affairs whether his Department has now submitted all relevant papers to the Immigration Appellate Authority in the case of Mr. M. A., husband of Mrs. S. A., if Aylesbury (refs.448W
  A1146799; ISB/566943; TH/25294/2002); what the expected timescale of the appeal is; and if he will make a statement. [166640]

  Mr. Mullin
  [holding answer 19 April 2004]: I have written to the hon. Member.

  St. Helena
  Bob Spink
  To ask the Secretary of State for Foreign and Commonwealth Affairs what recent representations he has received about the development of an airport on St. Helena; and if he will make a statement. [162912]

  Mr. Rammell
  The Foreign and Commonwealth Office has received representations from one of the parties who expressed an interest in the development of air access for St. Helena.

  Evaluation of the four expressions of interest and outline proposals, received in response to the international invitation issued in April 2003, concerning the possible development of air access to St. Helena, is now complete. I also refer the hon. Member to the written statement made by my hon. Friend the Parliamentary Under-Secretary of State at the Department for International Development (Gareth Thomas) on 19 April, Official Report, column 1WS.

  Guinea
  Mr. Chidgey
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the formation of the new government in Guinea in March. [166588]

  Mr. Mullin
  On 23 February, President Conte announced the appointment of the former Foreign Minister Francois Fall as Prime Minister. On 2 March he announced a further round of ministerial changes, with five new additions to the Cabinet.

  The British Government, and the EU more broadly, are concerned at issues of governance and human rights in Guinea. EU article 96 negotiations have started. Under Article 96 of the Cotonou Agreement the EC is able to take appropriate measures, such as the suspension of aid, against Africa, Caribbean and Pacific states who fail to meet their obligations regarding human rights, democracy and the rule of law.

  Hum in Rights (Africa)
  Mr. Chidgey
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the importance of human rights in relation to economic growth and development in African countries. [166589]

  Mr. Mullin
  There is an increasingly clear link between respect for human rights, the rule of law and democratic norms en the one hand, and stability, prosperity and progress on the other. We believe that a stable environment where human rights and the rule of law are respected creates the best conditions for economic growth and the reduction of poverty in Africa. We also consider that protection and promotion of human rights such as access to education, healthcare, and justice can have a direct impact on future economic development and can help African countries meet the
  449W
  Millennium Development Goals. In this respect, since 1998 the Foreign and Commonwealth Office has funded over 60 human rights projects worth more than £6 million in sub-Saharan Africa alone. We also support initiatives such as the Africa Peer Review Mechanism of the New Partnership for Africa's Development, which aims to ensure that the policies and practices of participating states conform to agreed standards of political, economic and corporate governance.

  Illegal Drugs Tade
  Paul Flynn
  To ask the Secretary of State for Foreign and Commonwealth Affairs how much the UK spent on reducing the illegal drugs trade in(a) South Africa, (b) Eastern Europe and (c) Central Asia in each of the last five years; and what assessment he has made of the effect of this expenditure on the trade in drugs. [166874]

  Mr. Rammell
  There are no figures available for total UK spending on UK efforts which contribute towards reducing illegal drug trade in the areas mentioned. Spending by a range of Government Departments on matters such as the alleviation of poverty, law enforcement co-operation and other areas may all directly or indirectly contribute to the reduction in the illegal drugs trade and cannot be calculated precisely. Information is however available in respect of specific funds within the responsibility of the Foreign and Commonwealth Office (FCO).

  The UK Drugs and Crime Fund (DCF) is administered by the FCO. Its remit is to support project work aimed at reducing the threat to the UK caused by drugs and serious crime overseas. Colombia, Jamaica, Iran, Pakistan, Afghanistan and turkey are currently the highest priority countries for drugs funding from the DCF.

  Since financial year 1999–2000, £36,779,926 has been spent world-wide on drug related projects, of which £17,416,886 was spent in Latin America and the Caribbean, £5,593,246 in Eastern Europe and Turkey and £10,072,530 in Central Asia. DCF projects have contributed directly to significant seizures of drugs and helped improve the skills and equipment of law enforcement partners overseas.

  The elimination of the threat to the UK from the cultivation of opium in Afghanistan is a top priority for the Government. Some 95 per cent. of the heroin reaching the UK originates in Afghanistan. The Afghan Government has set the objective of eliminating opium cultivation there by 2013 and the UK has committed £70 million over three years to support implementation of this strategy, part of which comes from the DCF but the remainder from other source; of FCO and other Government Department funding

  Indonesia
  Mr. Damian Green
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations he has made to the Indonesian Government about religious freedom; and if he will make a statement. [166462]

  Mr. Mike O'Brien
  I met with the Indonesian Ambassador on 6 October and 10 November 2003 and 4 March 2004 and on each occasion we discussed a wide 450W
  range of issues, including religion. We support the Indonesian Government's efforts to bring peace to the provinces of Central Sulawesi and Maluku.

  The British Government is committed to working with Indonesia to encourage religious tolerance. Together with the Department for International Development, we have committed over £4 million to help establish the United Nations Development Programme Conflict Prevention and Recovery Unit in Jakarta. The Unit will build up capacity in conflict reduction and recovery in the provinces affected by religious conflict. This includes funding projects like the Maluku Reconciliation Conference, which was held in London and Brussels in January 2004 and which brought together Muslim and Christian Leaders from Maluku to discuss how to establish peace in the province.

  Burma
  Mr. Leigh
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans the Government has in the near future to call for a European Union demarche to the Burmese regime regarding the Burmese military's atrocities against the Karen, Karenni and Shan peoples. [166644]

  Mr. Mike O'Brien
  We regularly discuss human rights issues on Burma with our EU partners. The UK has been instrumental in pressing for and supporting numerous demarches to the Burmese regime, including on human rights abuses against the ethnic groups.

  Mr. Leigh
  To ask the Secretary of State for Foreign and Commonwealth Affairs whether the British Government classifies systematic atrocities against the Karen, Karenni and Shan peoples by the Burmese military as (a) war crimes and (b) crimes against humanity under international law. [166645]

  Mr. Mike O'Brien
  The British Government is one of the strongest critics of the Burmese regime's abuses of human rights. We are aware of a consistent pattern of serious violations over many years, particularly against the ethnic groups. These have been highlighted in successive UK co-sponsored resolutions on Burma in both the United Nations General Assembly and the United National Commission on Human Rights. But we do not consider that the atrocities constitute "war crimes" and "crimes against humanity", which have specific definitions under international law. Nor does the United Nations Special Rapporteur for Human Rights in Burma, Sergio Pinheiro, who has regular access to Burma use these terms to describe the situation there.

  Mr. Leigh
  To ask the Secretary of State for Foreign and Commonwealth Affairs if the Government will take steps to strengthen the European Union common position on Burma, in response to the continuing systematic atrocities against the Karen, Karenni and Shan peoples by the Burmese military. [166646]

  Mr. Mike O'Brien
  Given the State Peace and Development Council's (SPDC) announcement that the National Convention, the first step of the SPDC's 7-point roadmap to national reconciliation, will reconvene on 17 May to draft a new constitution for Burma we believe that it would send a wrong signal to
  451W
  strengthen sanctions under the EU's Common Position on Burma at a time when the regime may be moving forward with the political process. We are therefore prepared to support a rollover of existing measures in the EU Common Position on Burma which already contains tough measures against the regime. However, we remain ready to respond proportionately to developments on the ground in Burma.

  We have been pressing strongly for the release of Aung San Sui Kui and Oo Tin Oo. I raised this on 18 April with the Chinese, Thai, Malaysian and Vietnamese neighbours of Burma at the ASEM Foreign Ministers meeting.

  Mr. Leigh
  To ask the Secretary of State for Foreign and Commonwealth Affairs what representations the Government has made to the Burmese regime regarding recent Burmese military offensives in Northern Karen State and Karenni State. [166657]

  Mr. Mike O'Brien
  I regularly raise our concerns on Burma with the Burmese authorities, most recently when I met the Burmese Ambassador at the end of February.

  Mr. Leigh
  To ask the Secretary of State for Foreign and Commonwealth Affairs if the Government will raise the issue of the Burmese military's systematic atrocities against the Karen, Karenni and Shan peoples at the UN Security Council. [166658]

  Mr. Mike O'Brien
  We have raised our concerns over human rights violations in Burma with our Security Council Partners. However, currently there is no consensus to bring Burma before the Security Council.

  Atrocities against ethnic groups in Burma have been highlighted in successive EU co-sponsored UN Resolutions on Burma.

  East Timor
  Mr. Marsden
  To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the progress made in identifying those responsible for the deaths of Malcolm Rennie and Brian Peters in East Timor. [166081]

  Mr. Mike O'Brien
  The Foreign and Commonwealth Office is continuing its enquiries into what information is needed to enable indictments to be issued. I raised this issue with the Indonesian Ambassador when I met him in March. I also raised the issue with the Indonesian Foreign Minister at the ASEM summit on 18 April.

  Computer Services
  Bob Spink
  To ask the Secretary of State for Foreign and Commonwealth Affairs what plans he has to update computer(a) hardware and (b) software standard packages used in his Department. [166362]

  Mr. Rammell
  The Foreign and Commonwealth Office has an extensive and well-developed strategy for updating its information and communications technology. This is set out in our "e-diplomacy" strategy as announced to the House on 24 March (Official Report, Columns 52–53 WS).
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  Sudan
  Mr. Spring
  To ask the Secretary of State for Foreign and Commonwealth Affairs what discussions he has had with the (a) Arab League, (b) Government of Chad an (c) Sudanese Government on the situation in Darfur; and if he will make a statement. [166535]

  Mr. Mullin
  We welcome the humanitarian ceasefire agreement between the Government of Sudan and the Sudan Liberation Movement/Army and the Sudan Justice and Equality Movement which was signed in N'djamena, Chad, on 8 April 2004. This is an important step forward in resolving the crisis in Darfur and we are very grateful to the Government of Chad for its role in mediating the ceasefire talks.

  My right hon. Friend the Secretary of State for International Development spoke to the Sudanese Foreign Minister about Darfur on 24 March, and since then our Ambassador in Khartoum has had a number of discussions with him. We have not been in contact with the Arab League on this issue, though we have discussed the matter with the Government of Chad.

  Nepal
  Mr. Spring
  To ask the Secretary of State for Foreign and Commonwealth Affairs what restrictions there are on the leaders of the Maoist terrorist movement of Nepal visiting the United Kingdom. [166198]

  Mr. O'Brien
  Any entry clearance application made by a Nepalese national would be considered in accordance with the UK Immigration Rules. Any security or other concerns regarding particular individuals would be considered at the time of the application. I will write to the hon. Gentleman.

TRANSPORT

  Prestwick Air Traffic Control center
  Mr. Leigh
  To ask the Secretary of State for Transport what assessment he has made of progress by National Air Traffic Services in securing investment to expand air traffic control capacity, with particular reference to restarting work on the new control center in Prestwick. [166178]

  Mr. Darling
  The New Prestwick Air Traffic Control center is an integral part of NATS operations. It will handle operations over the eastern half of the North Atlantic, the northern half of the UK and much of the North Sea. Work on the new center at Prestwick is due to start later this year.

  London Rail Services
  Simon Hughes
  To ask the Secretary of State for Transport what assessment he has made of the changes in rail services in Greater London recently proposed by the Strategic Rail Authority. [166179]

  Mr McNulty
  The Strategic Rail Authority is developing a number of schemes which will improve rail services in the Greater London area including the East London Line extensions, Integrated Kent Franchise,
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  Thameslink 2000, southern power supply upgrade and replacement of slam door trains with modern rolling stock.

  Biofuels
  Paddy Tipping
  To ask the Secretary of State for Transport when he will publish the consultation document on introducing the EU Biofuels Directive. [166181]

  Mr. Jamieson
  The consultation document will be published very shortly.

  Colin Burgon
  To ask the Secretary of State for Transport what steps are being taken to improve rail commuter services in the Elmet constituency. [166182]

  Mr. McNulty
  The Strategic Rail Authority is actively working with the train operating companies to secure improvements to the operational performance of services.

  A303
  Mr. Heath
  To ask the Secretary of State for Transport when he expects the safety improvements to the A303 between Sparkford and Ilchester to be completed. [166183]

  Mr. Jamieson
  I am expecting a submission shortly which will allow me to add the Sparkford to Ilchester Scheme into the Targeted Programme of Improvements. Its completion will be subject to the usual statutory procedures and availability of funds hence I cannot be definite on its timing.

  Regional Airports
  Tim Loughton
  To ask the Secretary of State for Transport what his policy is on improving road and rail transport links to smaller regional airports in the South East of England. [166184]

  Mr. McNulty
  Our policy on improving road and rail links to airports in the South East of England (small and large) is set out in the Future of Air Transport White Paper. This recognises that airports are part of our national infrastructure and requires the SRA, Highways Agency to take full account of a prospective airport developer. It also looks to airport operators to work with regional and local partners to ensure that regional and local transport strategies do the same.

  Crossrail
  Linda Perham
  To ask the Secretary of State for Transport if he will make a statement on the options for financing Crossrail. [166185]

  Dr. Howells
  Adrian Montague's detailed advice on the current Crossrail proposals raises complex issues and requires careful consideration against pressures on transport spending, especially on rail. My right hon. Friend will make a statement in due course.

  Transport Infrastructure (London)
  Mr. Love
  To ask the Secretary of State for Transport what estimate he has made of the additional funding 454W
  required for transport infrastructure in London to meet the projected increase in population over the next 10 years. [166186]

  Mr. McNulty
  The Government is providing TfL with over £2.2 billion this year to improve transport across London—this is more than double the amount of funding given to London transport four years ago. Any additional funding required for transport improvements in London and other regions, in order to accommodate projected population growth, is being considered by the Department in the context of this year's Spending Review.

  Mr. Dismore
  To ask the Secretary of State for Transport what assessment he has made of extra funding needed for transport infrastructure in London. [166187]

  Mr. McNulty
  The Government is providing TfL with over £2.2 billion this year to improve transport across London—this is more than double the amount of funding given to London transport four years ago. Any additional funding required for transport improvements in London and other regions is being considered by the Department in the context of this year's Spending Review.

  Road Noise
  Tony Baldry
  To ask the Secretary of State for Transport when he next expects to meet the Chief Executive of the Highways Agency to discuss the issue of noisy roads. [166188]

  Mr. Jamieson
  I am in regular contact with the Chief Executive of the Highways Agency on issues concerning noisy roads. I have recently agreed the Highways Agency's Business Plan for 2004–05, which includes a commitment to resurface 50 lane kms of concrete road surface with lower noise surfacing. In addition, all maintenance work carried out on flexible road surfaces now uses quieter road surfaces.

  Mr. Watson
  To ask the Secretary of State for Transport what assessment he has made of the use of ripple print pads on road services to reduce (a) accidents and (b) noise. [166835]

  Mr. Jamieson
  The Department has been monitoring the effects of installing rumblewave surfacing (marketed as Rippleprint by Prismo Limited) at seven pilot sites. An initial report has been published by TRL Limited (TRL Report 545 Development of a novel traffic calming surface "Rippleprint"), and I have placed copies of this report in the Libraries of the House. A final report will be published later this year.

  Mr. Watson
  To ask the Secretary of State for Transport what assessment he has made of the effectiveness of sound-absorbing concrete in reducing traffic noise. [166849]

  Mr. Jamieson
  The Highways Agency is keeping in touch with developments in Europe on work on noise absorbing concrete. In general, porous concrete has been shown to have similar noise absorbing properties to porous asphalt, with the same disadvantages of high cost and loss of benefit over time as the pores become clogged. Initial trials in European countries of a new
  455W
  surfacing using a resonant cavity formed in concrete below porous asphalt, have given lower noise reduction benefits than expected.

  Mr. Watson
  To ask the Secretary of State for Transport how much has been spent on roadside noise barriers in each of the last 10 years. [166850]

  Mr. Jamieson
  Figures for the last 10 years are not available. Spend on noise barriers that are provided in conjunction with highway improvement scheme is not separately identified in the scheme cost. Spend on the installation of noise barriers provided retrospectively on older trunk roads that commenced in 2000, has been met by the £5 million per year ring-fenced allocation.

  Stockport Station
  Andrew Bennett
  To ask the Secretary of State for Transport when he expects the new platform 1 at Stockport Station to be in use; who paid for it; and whether its introduction to use is dependent on a new signalling. [162420]

  Mr. McNulty
  These are operational matters for Network Rail. Network Rail will respond directly to my hon Friend.

  Unaudited 2003–04 £000s (subject to change)

  2002–03 £000s

  2001–02 £000s

  2000–01 £000s

  1999–2000 £000s

  Scotland (including Shetland & Stornoway Helicopters)

  £12,266

  £11,718

  £10,246

  £10,715

  £9,063

  All of UK (including Scotland and Helicopters)

  £34,849

  £32,891

  £31,121

  £32,173

  £28,105

  Mr. Carmichael
  To ask the Secretary of State for Transport if he will make a statement on the future of coastguard stations around the Scottish coast. [166775]

  Mr. Jamieson
  There are no plans to make changes to Coastguard operations around the Scottish coast, but my Department will continue to keep effectiveness and efficiency under review to make the best use of technology and resources.

  Mr. Carmichael
  To ask the Secretary of State for Transport if he will make a statement on the level of planned future expediture on coastguard services in(a) Scotland and (b) the UK. [166776]

  Mr. Jamieson
  The level of planned future expenditure for Scotland and the UK on Coastguard services will be broadly in line with previous years.

  East Coast Main Line
  Mrs. May
  To ask the Secretary of State for Transport (1) when he expects the East Coast Mailine Franchise to be awarded; [166432]

  (2) for what reason the announcement on the new East Coast Mainline Franchise has been delayed; [166433]

  Rail Tracks (Speed Limits)
  Mr. Greg Knight
  To ask the Secretary of State for Transport how many miles of railway track are subject to speed limits imposed primarily or solely to prolong the life of the track; if he will list the locations thereof; and if he will make a statement. [163176]

  Dr. Howells
  [holding answer 25 March 2004]: This is an operational matter for Network Rail. Network Rail will respond directly to the right hon. Member.

  Coastguard Services
  Mr. Carmichael
  To ask the Secretary of State for Transport what assessment his Department has made of savings that could be made by reducing the number of coastguard stations around the Scottish coast. [166773]

  Mr. Jamieson
  There are no plans to reduce the number of Coastguard Co-ordination centers in Scotland and no assessment of savings has been made.

  Mr. Carmichael
  To ask the Secretary of State for Transport how much has been spent on coastguard services in (a) Scotland and (b) the UK in each of the last five years. [166774]

  Mr. Jamieson
  Coastguard expenditure in Scotland and the UK in the last five years is shown below:

  (3) what assessment he has made of the effect the delay in the announcement of the East Coast Mainline Franchise upon (a) the purchase of new rolling stock and (b) planned upgrades to the track; [166434]

  (4) what assessment he has made of the implications of the delay in the Announcement of the East Coast Mailine Franchise on rail services to Harrogate and Knaresborough. [166435]

  Mr. Darling
  The existing East Coast Main Line Franchise expires in April 2005. The SRA invited expressions of interest from operators in January 2004. The process is continuing.

  Road Schemes
  John Thurso
  To ask the Secretary of State for Transport if he will list the projects in the Highways Agency's Targeted Programme of Improvements with their(a) estimated cost, (b) start date of construction and (c) planned completion date. [166100]

  Mr Jamieson
  The following projects, with their estimated cost, are included in the Targeted Programme of Improvements (TPI):
  457W

  Scheme

  Scheme Cost (£m)

  A1 Stannington Junction (under constriction)

  8.3

  A 10 Wadesmill, High Cross and Colliers End (under construction)

  39.0

  A 120 Stansted—Braintree Improvement (under construction)

  86.9

  A2 Bean—Cobham Phase 1 Bean-Tollgate (under construction)

  19.7

  A21 Lamberhurst Bypass (under construction)

  18.9

  A34 Chieveley/M4 J13 Improvement (under construction)

  76.0

  A63 Selby Bypass (under construction)

  68.4

  A14 Rookery Crossroads Grade Separated Junction

  7.7

  A249 Iwade—Queenborough Improvement

  80.8

  A421 Great Barford Bypass

  39.0

  A47 Thorney Bypass

  25.4

  A5 Weeford—Fazeley Improvement

  38.0

  A63 Melton Grade Separated Junction

  22.5

  M4 Junction 18 Eastbound Diverge

  9.8

  M5 Junctions 17–18 Northbound Climbing Lane

  6.2

  A30 Bodmin Indian Queens

  68.9

  A66 Long Newton Junction

  8.0

  A2/A282 Dartford Improvement

  79.7

  A30/A382 Merrymeet Junction

  8.7

  A428 Caxton Common to Hardwick Improvement

  43.9

  A11 Attleborough Bypass

  29.3

  A3 Hindhead Improvement

  167.5

  A595 Parton-Lillyhall Improvement

  24.9

  M40/A404 Handy Cross Junction Improvement

  11.8

  A1 (M) Bramham-Wetherby (including Wetherby Bypass)

  61.6

  Al Peterborough-Blyth Grade Separated Junctions

  63.2

  All Fiveways-Thetford Improvement

  60.2

  A2 Bean-Cobham Phase 2 Tollgate-Cobham

  101.0

  A38 Dobwalls Bypass

  35.7

  A419 Blunsdon

  40.2

  A419 Commonhead Junction

  16.3

  A5117/A550 Deeside Park Junctions Improvement

  43.1

  M6 Carlisle to Guardsmill extension

  69.1

  M5 Junctions 19–20 Southbound Climbing Lane

  8.1

  M5 Junctions 19–20 Northbound Climbing Lane

  7.9

  A14 Haughley New St-Stowmarket Improvement

  29.0

  A21 Tonbridge to Pembury

  64.9

  A30 Temple to Higher Carblake Improvement

  40.7

  A45/A46 Tollbar End Improvement

  57.0

  A505 Dunstable Northern Bypass (A5 to MI Link)

  48.1

  A57/A628 Mottram in Longdendale, Hollingworth and Tintwistle Bypass

  90.0

  A66 Temple Sowerby and Improvement at Winderwath

  23.3

  A69 Haydon Bridge Bypass

  24.2

  M1 J19 Improvement

  123.4

  Ml Junction 10 to 13 Widening

  381.8

  MI Junction 6a to 10 Widening

  241.2

  M40 Junction 15 (Longbridge)

  57.2

  M62 Junction 6 Improvement

  38.0

  A30 Carland Cross to Chiverton Cross

  124.6

  A421 Bedford to M 1 Junction 13

  171.0

  A46 Newark-Widmerpool Improvement

  186.0

  A1 Adderstone to Belford Dualling

  14.2

  Al Morpeth to Felton Dualling

  84.0

  Al/A19/A1068 Seaton Burn Junction Improvement

  29.5

  A19/A184 Testos Junction Improvement

  20.5

  A483 Pant-Llanymynech Bypass

  40.5

  A590 High and Low Newton Bypass

  22.1

  A64 Rillington Bypass

  11.8

  A66 Carkin Moor to Scotch Corner Improvement

  11.0

  A66 Greta Bridge to Stephen Bank Improvement

  9.2

  A14 Ellington-Fen Ditton Improvement

  490.0

  A1(M) Dishforth to Leeming

  355.0

  A1(M) Leeming to Barton

  (cost included above)

  458W

  Scheme

  Scheme Cost (£m)

  A1(M) Ferrybridge-Hook Moor (under construction)

  160.5

  A1(M) Wetherby—Walshford (under construction)

  33.5

  A303 Stonehenge

  223.1

  A47 Blofield to North Burlingham Dualling

  15.4

  A500 City Road and Stoke Junction Improvement (under construction)

  59.6

  A64 Colton Lane Grade Separated Junction (under construction)

  11.0

  M20 Junction 10A

  46.0

  M25 J12–15 Widening (under cosntruction)

  104.5

  M60 J5–8 Widening (under construction)

  116.5

  A27 Southerham to Beddingham

  18.9

  M25 Widening Junction lb-3

  65.9

  M25 Widening Junction 5–7

  214.4

  M25 Widening Junction16–23

  496.0

  M25 Widening Junction 23–27

  419.1

  M25 Widening Junction 27–30

  402.3

  M 1 Widening Junction 21–30

  1,914.6

  These costs include the latest Treasury guidance on risk and optimism bias and allow for inflation at 2.5% per annum.

  Of these, the following schemes are expected to start works in 2004–05, with anticipated completion dates as shown:

  Scheme

  Date of Completion

  A14 Rookery Crossroads Grade Separated Junction

  2005–06

  A249 Iwade-Queensborough Improvement

  2006–07

  A421 Great Barford Bypass

  2006–07

  A47 Thorney Bypass

  2005–06

  A5 Weeford-Fazeley Improvement

  2005–06

  A63 Melton Grade Separated Junction

  2006–07

  M4 Junction 18 Eastbound Diverge

  2005–06

  M5 Junctions 17–18 Northbound Climbing Lane

  2005–06

  Firm decisions have yet to be made on start of works for the remainder of the programme.

  John Thurso
  To ask the Secretary of State for Transport which major local road schemes in England have been given(a) provisional and (b) full Government approval in each of the last four years; what their current status is; and what the (i) expected start date and (ii) completion date is in each case. [166101]

  Mr. Jamieson
  Local major road schemes in England, excluding London that have been given(a) provisional and (b) full Government acceptance in each of the last four years are set out in the following table, together with the current status.

  Three schemes in the table, which have been provisionally accepted, have been re-designated as Work in Progress following changes from the original scheme proposals. A number of schemes that were provisionally accepted in earlier settlements have been

  459W
  fully accepted since 2000. Expected start and completion dates shown in the table reflect the Department's current information of the proposed delivery timetables of the relevant local authorities. Delivery of schemes is subject

  Scheme

  Current Status (A) Fully Accepted (PA) — Provisionally Accepted

  Expected Start of Works

  Expected Scheme Completion Date

  2000 LTP Settlement

  Wyre Piddle Bypass

  Open (December 2002)

  A689 Sedgefield to Wynard Improvement

  Open (April 2003)

  Biddulph Inner Bypass

  Open (October 2003)

  Semington to Melksham

  Open (March 2004)

  Burntwood Bypass Phase 3

  A

  May 2004

  April 2005

  Nar Ouse Regeneration Project

  A

  January 2004

  July 2005

  South Lowestoft Relief Road

  PA

  May 2004

  December 2005

  W. Thurrock Regeneration Ring Road

  A

  April 2002

  April 2004

  A1073 Spalding to Eye Improvement

  PA

  Scheme reverted to 'Work in Progress' in 2003

  A13/Al27–A1159 Corridors

  A

  July 2002 (Public Transport), 2006 Autumn 2004 (Road)

  Earl Shilton Bypass

  PA 2000

  Scheme reverted to 'Work in Progress' in 2002

  A607 Rearsby Bypass

  A

  March 2004

  December 2004

  A158/C541 Coastal Access Improvement

  PA

  April 2004

  June 2007

  Connecting Derby Integrated Transport A—Phase 1 Phases 1, 2 & 3

  Phase 2 and 3 of schme also Accepted in 2000 but were reverted to 'Work in Progress' in 2003

  Sunderland Southern Radial Route

  PA

  June 2004

  March 2006

  Darlington Eastern Transport Corridor

  PA

  July 2004

  December 2005

  A688 Wheatley Hill to Bowburn Link

  PA

  October 2004

  December 2005

  A167 Chilton Bypass

  A

  May 2004

  July 2005

  Scotswood Road Improvement

  A

  April 2004

  August 2006

  Carlisle Northern Development Route (PFI)

  PA

  October 2005

  October 2007

  Bridgefoot Environment Enhancement

  PA

  October 2004

  March 2006

  The Glossop Spur

  PA

  April 2006

  April 2008

  Hall Lane Area Improvement Scheme

  PA

  November 2005

  February 2007

  East Kent Access Phase 1

  PA

  August 2003

  October 2005

  Stoke Hammon/Linslade Western Bypass

  PA

  October 2006

  December 2008

  Brunel Link & Harnham Relief Road

  PA

  November 2003

  April 2005

  Barnstaple Western Bypass

  PA

  October 2004

  December 2006

  NW Taunton Package

  PA

  July 2004

  November 2005

  A39 Camelford Bypass

  PA

  January 2005

  August 2006

  Weymouth Relief Road

  PA

  See LTP 2003 Settlement section

  Rugeley Bypass

  A

  April 2005

  December 2006

  Hanley Bentilee Link

  PA

  March 2006

  August 2007

  Barford Bypass

  PA

  February 2005

  September 2006

  Cradley Heath Town center

  PA

  October 2004

  April 2005

  Rugby Western Relief Road

  PA

  N/A

  Northfield Regeneration (Birmingham)

  PA

  December 2005

  December 2006

  Owen Street Relief Road

  PA

  January 2005

  December 2006

  East Leeds Link Road

  A

  October 2004

  September 2006

  Leeds Inner Ring Road Stage 7

  A

  October 2005

  September 2008

  Sheffield Inner Relief Road—Stages 2 & 3

  PA

  June 2004

  September 2008

  Glasshoughton Coalfields Link Road

  PA

  March 2005

  May 2007

  A63I West Bawtry Road Improvement

  PA

  February 2005

  April 2006

  Hemsworth—A1 Link Road

  PA

  March 2005

  February 2007

  South Bradford Integrated Transport

  A

  February 2003

  July 2004

  460W
  to completion of all necessary statutory procedures. Departmental funding of schemes is subject to conditions set out in the relevant decision letters issued to local authorities.
  461W

  Scheme

  Current Status (P)(PA)—Provisionally Accepted

  Expected Start of Works

  Completion Date

  2001 LTP Settlement

  Al198 Papworth Everard Bypass

  PA

  Late 2004

  April 2006

  East Corridor South

  PA

  Early 2005

  Mid 2006

  Markham Employment Growth Zone

  PA

  Spring 2005

  Spring 2007

  A612 Gedling ITP Scheme

  PA

  March 2005

  March 2007

  A6096 Ilkeston Awsworth Link

  PA

  September 2004

  March 2006

  A34 Alderley Edge Bypass

  PA

  2005

  2007

  A228 Main Road to Ropers Lane (Phase 1)

  A

  January 2003

  October 2004

  Bletchley Link

  PA

  April 2005

  March 2008

  Junction 11 M4 Improvement Proposals

  PA

  August 2004

  July 2006

  Poole Bridge Regeneration Initiative

  PA

  November 2004

  May 2006

  Selly Oak Relief Road

  PA

  2005–06

  2007–08

  A628 Cudworth and West Green Bypass

  PA

  November 2004

  October 2006

  Oakham Bypass

  PA

  September 2004

  April 2007

  A57(T) M1 Junction 31-Todwick Crossroads

  PA

  August 2005

  August 2006

  A1 South East Northumberland Link Road (Pegswood Bypass)

  PA

  April 2005

  July 2007

  The Kiln Lane Link, Epsom

  PA

  July 2006

  November 2007

  A244 Walton Bridge

  PA

  April 2006

  September 2008

  2002 LTP Settlement

  Mansfield Ashfield Regeneration Route

  A

  June 2003

  December 2005

  North Middlesbrough Accessibility IMPS

  PA

  June 2005

  June 2006

  Sunderland Central Route

  PA

  June 2005

  June 2006

  Cadishead Way

  PA

  December 2003

  June 2005

  Ashton Northern Bypass Stage 2

  PA

  October 2004

  March 2006

  Wigan Inner Relief Road

  PA

  October 2004

  April 2006

  A58 Blackbrook Diversion

  PA

  December 2005

  September 2004

  A165 Reighton Bypass

  PA

  April 2005

  March 2006

  A43 Corby Link Road

  PA

  April 2006

  July 2007

  A24 Horsham—Capel

  PA

  January 2006

  January 2008

  A24 Ashington/Southwater

  PA

  March 2006

  September 2007

  A228 Leybourne & West Malting Corridor Improvement

  PA

  Spring 2005

  Spring 2007

  Mereoak Roundabout

  PA

  July 2005

  July 2007

  A391 St Austell to A30 Link

  PA

  2007

  2009

  2003 LTP Settlement

  A142 Fordham Bypass

  A

  April 2004

  August 2005

  A509 Isham Bypass

  PA

  June 2003

  December 2005

  A1056 North Tyneside Northern Gateway Stage 2

  PA

  December 2005

  Late 2006/Early 2007

  A354 Weymouth Relief Road

  PA

  2007

  2010

  Brierley Hill Access Network

  PA

  2004–05

  2007

  Tunstall Northern Bypass

  PA

  January 2005

  January 2006

  Darlaston Strategic Area Access Scheme

  PA

  June 2006

  May 2008

  Notes:

  1 Dates can change as the Local Authority takes the scheme through the required statutory procedures.

  2 A = Fully Accepted schemes.

  3 PA = Provisionally Accepted. Schemes subject to completion of statutory procedures and any other processes outlined in the settlement decision letter, from the Government Office to the Local Authority, of the relevant LTP Settlement year.

  Finningley Airport
  Mr. Bill O'Brien
  To ask the Secretary of State for Transport what plans are being considered for freight to be handled at and transported from Finningley Airport; and if he will make a statement. [165712]
  462W
  Mr. McNulty
  The planning permission granted in April 2003 limits the number of air cargo movements per annum to 2,738 from the opening of the airport, rising to a maximum of 4,140 movements per annum after 1 January 2012. I understand that, within these limits, the airport operator hopes to handle around 50,000 tonnes of freight a year by 2014. A small component of this could be in the bellyhold of passenger aircaft.

CONSTITUTIONAL AFFAIRS

  Prisoners (Voting Rights)
  Mr. Maude
  To ask the Parliamentary Under-Secretary of State, Department for Constitutional Affairs what plans he has to allow serving prisoners to vote in(a) local and (b) general elections; and if he will make a statement. [166795]

  Mr. Leslie
  At present, convicted and detained prisoners are not able to vote in UK elections. On 30 March 2004, the European Court of Human Rights gave its judgment in the case of Hirst v. The United Kingdom, concerning the disfranchisement of convicted prisoners. The Court found that there had been a breach of the applicant's human rights. We are currently carefully considering the implications of the judgment and what action we might take.

  Freedom of Information (Terrorism)
  Llew Smith
  To ask the Parliamentary Under-Secretary of State, Department for Constitutional Affairs, what assessment has been made of the current exemptions to the release of information contained in freedom of information legislation in light of recent terrorist incidents and threats. [166035]

  Mr. Lammy
  The Freedom of Information Act 2000 balances the right to know with the proper conduct of effective government. Part II of the Act outlines classes of information that are exempt from disclosure for the purpose of safeguarding national security, defence and international relations. Information supplied by, or relating to, bodies dealing with security matters is also exempt.

  The Government is satisfied that the provisions in Part II of the Freedom of Information Act 2000 provides a robust framework that gives people greater access to information, while ensuring that information necessary to protect national security is properly safeguarded.

  Legal Services Commission
  Mr. Roger Williams
  To ask the Parliamentary Under-Secretary of State, Department for Constitutional Affairs, (1) how many new solicitors firms have undertaken contracts with the Legal Services Commission since 2000. [165842]

  (2) how many solicitors firms in England and Wales have withdrawn from a Legal Services Commission contract in each year since 2000. [165843]

  Mr. Lammy
  Between January 2000 and 31 March 2004, the Legal Services Commission (LSC) has awarded 755 new civil contracts to solicitors' firms. Since contracting for criminal legal aid began in April 2001, the LSC has awarded 412 new criminal contracts to solicitors' firms.

  The LSC does not collect data centrally on the number of solicitors' firms that have withdrawn from legal aid work. The number of contracts that have been terminated by the LSC in each year (which includes cases where solicitors have withdrawn voluntarily) is set out below.
  464W
  Civil Contracts

  April 2000 to March 2001: 700

  April 2001 to March 2002: 539

  April 2002 to March 2003: 408

  April 2003 to March 2004: 633

  Criminal contracts

  April 2001 to March 2002: 146

  April 2002 to March 2003: 151

  April 2003 to March 2004: 317

TRADE AND INDUSTRY

  Sellafield
  Norman Baker
  To ask the Secretary of State for Trade and Industry if she will itemise the contents of the B30 ponds at Sellafield; what the origin was of the contents; what the radioactivity level of the contents is; and what plans she has to respond to criticisms by the EU Commission in respect of the ponds that comprise B30. [165818]

  Mr. Timms
  [holding answer 19 April 2004]: The B30 facility at Sellafield was commissioned in 1959–60 for interim storage of spent Magnox fuel in water-filled concrete ponds and the subsequent removal of cladding from the fuel prior to it being reprocessed. The facility stopped receiving spent fuel during 1992. The B30 pond contains many tonnes of Magnox fuel and sludge from corrosion of the Magnox fuel cladding and the fuel. For security reasons it would not be appropriate to reveal itemised information on the quantities of nuclear material held in specific locations (Exemption 1, code of practice on access to Government information).

  The condition of the material in B30 and the need to minimise radiation exposure means that the activities that can be performed at present to verify current quantities of material (including in the course Euratom safeguards inspections) are limited. Appropriate measurement and verification of the material will however take place as material is removed during the decommissioning of B30.

  Officials will examine details of the Commission Directive and the basis for it, and work is in hand to enable us to respond to the Commission accordingly.

  Iraq
  Mr. Chidgey
  To ask the Secretary of State for Trade and Industry what the financial value of the 10 largest contracts by US dollars for the reconstruction of Iraq already awarded by the Coalition Provisional Authority was; what the nationality of the contractor was; and to what industrial sector each related. [166604]

  Ms Hewitt
  The largest Coalition Provisional Authority contracts so far have been awarded on its behalf by the Program Management Office. They are given in the table:

  Value

  Sector

  Nationality

  $900 million (ceiling)

  Security, Justice and Safety

  US

  $600 million (ceiling)

  Water Resources

  US

  $600 million (ceiling)

  Public Works and

  US/UK Joint Venture

  465W

  Value

  Sector

  Nationality

  Water (North)

  $500 million (ceiling)

  Buildings, Health And Education

  US

  $500 million (ceiling)

  Public Works and Water (South)

  US/UK Joint Venture

  $500 million (ceiling)

  Electrical Generation

  US/UK Joint Venture

  $500 million (ceiling)

  Electrical Power Distribution (North)

  US

  $500 million (ceiling)

  Electrical Power Distribution (South)

  US

  $325 million (ceiling)

  Transportation

  US/Egypt/Netherlands/UAE Joint venture

  $75 million (ceiling)

  Communications

  US

  UK companies are already playing a significant role in many of these, through parent companies or as subcontractors or sub-consultants.

  Mr. Chidgey
  To ask the Secretary of State for Trade and Industry how many contracts have been awarded to British companies for the reconstruction of Iraq; what their total value is; and which companies have been awarded contracts. [166605]

  Ms Hewitt
  Because of the large number of different organisations involved in awarding reconstruction contracts in Iraq, it has not been possible to maintain an overall picture of the total volume of contracts awarded or the cumulative total. In addition, there is no central organisation that collects, collates and publishes such information. However, a number of British companies have been awarded contracts and sub-contracts for the reconstruction process in Iraq, including the recent awards announced by the Program Management Office (PMO). UK companies (mainly in Joint Venture with US partners) have won PMO contracts in the Electricity, Water and Oil sectors.

  Mr. Chidgey
  To ask the Secretary of State for Trade and Industry, if she will require British companies working in Iraq to recruit individuals of Iraqi nationality to work in the management of their operations. [166607]

  Ms Hewitt
  It is vital the UK companies play their part in developing Iraq, through the creation of joint business ventures, transfer of skills and technology and working with Iraqi partners in providing jobs and prosperity for the Iraqi people. In this way, we will maximise the use of local manufacturers and construction skills in order to help build local skills and provide sustainable employment for future generations. I have no plans to require British companies to recruit Iraqi nationals to work in the management of their operations.

  Business Activity (Crosby)
  Mrs. Curtis-Thomas
  To ask the Secretary of State for Trade and Industry how many small businesses are registered in Crosby; and what the percentage change has been since 1997. [164412]

  Nigel Griffiths
  Barclays Bank's latest survey of business creation, published on 31 March 2004, includes non-VAT registered firms, and shows that there were 115,000 business start-ups in England and Wales, including 500 in Sefton local authority (in which Crosby is a constituency) in the fourth quarter of 2003. The 466W
  latest yearly Barclays figures show 465,000 business start-ups in England and Wales in 2003, the highest figure since the survey began in 1988. Data for local authorities are not available for before 2003.

  There were 5,380 businesses registered for VAT in Sefton local authority at the end of 2002. This represents a 7 per cent increase since the start of 1997 when there were 5,040 VAT-registered businesses. VAT registration data for the end of 2003 will be available in Autumn 2004.

  It is important to note that VAT registration data do not capture all business activity. Businesses are unlikely to be registered if they fall below the compulsory VAT threshold, which has risen in each year since 1997. Similarly, businesses that de-register will not necessarily have closed. Only 1.8 million out of 3.8 million enterprises were registered for VAT at the start of 2002.

  Mrs. Curtis-Thomas
  To ask the Secretary of State for Trade and Industry what the total Entrepreneurial Activity index for(a) Crosby and (b) England is; and if she will make a statement. [164413],

  Nigel Griffiths
  The Total Entrepreneurial Activity (TEA) index is not produced by government, but is a measure used by the London Business School to compare international rates of entrepreneurial activity as part of its annual Global Entrepreneurship Monitor (GEM).

  The latest TEA index, for 2003, is 6.5 per cent for England and 4.7 per cent for the North West. The UK was the only other G8 country apart from the United States to have seen a major recovery in levels of entrepreneurial activity in 2003 following the overall drop in 2002.

  The UK GEM report does not provide a breakdown for areas smaller than the area covered by Government Office region. There is, therefore no TEA figure for Crosby.

  Employment Rights (Birkenhead)
  Mr. Frank Field
  To ask the Secretary of State for Trade and Industry how many residents of Birkenhead qualify for paid leave entitlement. [166503]

  Mr. Sutcliffe
  All workers resident in Birkenhead qualify for paid leave entitlements of at least 4 weeks as set out in the Working Time Regulations.

  Mr. Frank Field
  To ask the Secretary of State for Trade and Industry how many residents of Birkenhead have benefited from a reduction of the working week to 48 hours. [166504]

  Mr. Sutcliffe
  The Working Time Regulations provide workers with the right not to work more than 48 hours if they want to. Numbers for Birkenhead are not available, but it has been estimated that around 50,000 workers resident in Merseyside stood to benefit from the introduction of the weekly working time limits in 1998.

  Mr. Frank Field
  To ask the Secretary of State for Trade and Industry how many and what percentage of women in Birkenhead have taken 26 weeks' maternity leave since 1997. [166495]
  467W
  Mr. Sutcliffe
  Take-up of maternity leave is not recorded centrally. It is possible to make an estimate of the numbers of women taking maternity leave based on employer returns to Inland Revenue for payment of Statutory Maternity Pay (since 2003 this has covered the first 26 weeks of leave). However, figures for the take-up of SMP are not available on a regional basis.

  In addition, there will be some women who will qualify for maternity leave but not SMP (because they do not meet the earnings criteria) and similarly some who qualify for SMP but not leave (because they are employed earners for the purposes of SMP but not employees in order to qualify for leave).

  Mr. Frank Field
  To ask the Secretary of State for Trade and Industry if she will make a statement on the benefits of the EU Social Chapter for the residents of Birkenhead. [1665011

  Mr. Sutcliffe
  The residents of Birkenhead have benefited from the EU Social Chapter by having their employment rights extended to include:

  the right to parental leave which gives parents the right to 13 weeks unpaid leave at the birth or adoption of a child;

  the entitlement of part-time workers to the same pro-rata terms and conditions of employment as full-time workers, thereby removing any discrimination and improving the quality of part-time jobs;

  the provision that once a prima facie case has been made in an employment tribunal claim, the burden of proof is placed on the defendant (usually the employer), who will need to demonstrate that sex discrimination has not occurred;

  rights under the Fixed Term Work Directive that provide equal treatment and prevent abuse of fixed term contracts;

  rights under the European Works Council Directive which requires companies with at least 1,000 employees in total and at least 150 workers in each of the two Member States, to establish structures for consulting workers on issues that affect them; and

  in addition, the Information and Consultation of Employees Directive, to be implemented in the UK by March 2005, establishes a right to new minimum standards for workforce communication and involvement in large firms.

  Estate Agents Act
  Dr. Gibson
  To ask the Secretary of State for Trade and Industry if she will seek to amend the Estate Agents Act 1979 to include reference to buying and selling houses on the internet. [166113]

  Mr. Sutcliffe
  The Office of Fair Trading report on estate agents recommended that the definition of estate agency work in the Estate Agents Act 1979 be reconsidered to ensure that consumers buying and selling by non-traditional means, including the internet, are afforded the same protection in law as those who employ the services of traditional estate agents.

  The Department will consider carefully this and the report's other recommendations, and aims to publish a response by 18 June 2004.

  Broadband
  David Hamilton
  To ask the Secretary of State for Trade and Industry, what estimate she has made of broadband accessibility rates for(a) Scotland, (b)
  468W
  England, (c) Wales and (d) Northern Ireland, broken down by percentage of (i) households and (ii) population. [165586]

  Mr. Timms
  [holding answer 19 April 2004]: The Department of Trade and Industry has commissioned on-going research from Analysys Consulting Ltd to provide a comprehensive picture of developments in the UK broadband market.

  According to the latest quarterly survey to the end of December 2003, the following estimates are given of population (households) that are covered by a mass-market broadband solution:

  (a) Scotland

  72 per cent.

  (b) England

  87 per cent.

  (c) Wales

  72 per cent.

  (d) Northern Ireland

  67 per cent.

  This research is published quarterly on the Department's website:

  http://www.dti.gov.uk/industry_files/pdf/

  uk_broadband_coverage_jan2004.pdf

  Fire Safety
  Mr. Hayes
  To ask the Secretary of State for Trade and Industry, what measures are in place to assess the impact of furniture fire-safety regulations that came into effect in 1997; and what the findings have been. [166293]

  Mr. Sutcliffe
  The DTI commissioned the University of Surrey to research the effectiveness of the Regulations. The resulting report—"Effectiveness of the Furniture & Furnishings (Fire) (Safety) Regulations 1988"—was published in June 2000 and copies were placed in the Libraries of both Houses. The report's findings were "extremely good news". At a conservative estimate, the Regulations had saved at least 710 lives in the first ten years since their introduction, and at least 5,770 fewer people were injured in the same period. The benefits of the Regulations were most likely to be realised by the financially challenged, young children between 1 and 4 years of age, and the elderly. Recent figures from the Office of the Deputy Prime Minister indicate that this downward trend has continued.

  National Minimum Wage
  Huw Irranca Davies
  To ask the Secretary of State for Trade and Industry, if she will make a statement on the impact of the introduction of the national minimum wage for 16- to 17-year-olds on combating the exploitation of young people by employers. [164551]

  Mr. Sutcliffe
  The Government announced on 15 March 2004 that we will he introducing a new minimum wage rate for 16- to 17-year-old workers at £3.00 per hour with effect from 1 October 2004. Apprentices aged 16 and 17 will be excluded from the new rate. The great majority of young workers are already being paid in excess of the new rate, but this should help prevent the exploitation of young workers by a minority of employers. The Government run a national publicity campaign each autumn to publicise increases in the minimum wage and will be considering how best to publicise the new rate as part of that campaign.

  Focus Groups and Opinion Polls
  Mr. Laws
  To ask the Secretary of State for Trade and Industry, what her estimate is of total expenditure by her Department on(a) focus groups and (b) opinion polls in each year from 1995–96 to 2003–04; and if she will make a statement. [162752]

  Ms Hewitt
  The Department does not centrally collect the information sought at the required level of detail and to provide it would entail disproportionate cost because of the need to ask all Directors in the DTI, plus agencies and associated non-departmental public bodies, to attempt to provide details of each survey and piece of research commissioned since 1995.

  Working Time Directive
  Miss McIntosh
  To ask the Secretary of State for Trade and Industry, what assessment she has made of(a) implementation of the Working Time Directive in other EU member states and (b) costs to business in other EU member states of complying with the Working Time Directive. [164582]

  Mr. Sutcliffe
  Other EU member states have all implemented the Working Time Directive. From discussions with them, I know they have used the flexibilities available in the Directive in different ways, depending on their national circumstances and traditions, but I have made no formal assessment of this. I do not have figures for the cost to businesses for other EU member states.

  Miss McIntosh
  To ask the Secretary of State for Trade and Industry, what assessment she has made of the implications for the competitiveness of UK industry of complying with the Working Time Directive. [164583]

  Mr. Sutcliffe
  The Government have put in place a comprehensive set of measures aimed at raising competitiveness and closing the UK's productivity gap with major competitors. The U K economy has grown faster than the G7 average in five of the last six years. Since the Working Time Directive applies to all European Union members it is unlikely to put the UK at a competitive disadvantage with these competitors.

  British American tobacco
  Mr. Stephen O'Brien
  To ask the Secretary of State for Trade and Industry, what(a) resource budget, (b) administration costs and (c) staff numbers are dedicated to the Companies Act investigation into British American Tobacco. [165422]

  Mr. Sutcliffe
  [holding answer 19 April 2004]: As the inquiries have been concluded, no resources are currently dedicated to the Companies Act investigation into British American Tobacco Plc. The investigation was carried out internally by members of Companies Investigation Branch and there are no separate cost breakdowns.

  Companies Investigation Branch does not disclose operational matters such as the numbers of staff dedicated to any particular inquiry.

  Civil Servants
  Mr. Stephen O'Brien
  To ask the Secretary of State for Trade and Industry, whether the number of jobs in her Department that are to be(a) cut and (b) relocated are the same as the numbers given her Department's recent Business Plan 2004–07. [165119]

  Ms Hewitt
  The DTI business plan states that we will reduce the number of people in the Department's headquarters by 7 per cent by April 2005 and by 10 per cent by April 2006.

  We have also established an Efficiency Project which has developed proposals to improve further the way we work. These proposals would deliver a further 4 per cent reduction in posts by April 2008 (to 14 per cent) and 18 per cent of posts relocated outside London and the South East by April 2010. They are dependent on sufficient funding being available to meet the costs of change.

  Trade (Far East)
  Mr. Rosindell
  To ask the Secretary of State for Trade and Industry, what steps her Department is taking to promote trade with Far Eastern countries. [165543]

  Mr. Mike O'Brien
  Working with business, UK Trade and Investment has developed a global strategy for each industry sector, targeting markets, including many in the Far East, where there are felt to be significant opportunities for UK industry. A comprehensive package of trade development measures, including subsidised trade missions, trade fairs, help to find agents/distributors etc, are available to eligible UK companies.

  Invoices (Late Payment)
  Bob Spink
  To ask the Secretary of State for Trade and Industry, what plans she has to re-examine legislation relating to the late payment of invoices; and if she will make a statement. [163591]

  Nigel Griffiths
  There are no current plans to re-examine the late payment legislation.

EDUCATION AND SKILLS

  Secondments
  Mr. Cousins
  To ask the Secretary of State for Education and Skills what secondments(a) PricewaterhouseCoopers, (b) Deloitte & Touche, (c) Ernst & Young and (d) KPMG have made to his Department since 2001; for what (i) periods and (ii) tasks the secondments were made; whether secondments of staff from his Department have been to those firms; and what (a) periods and (b) tasks. [156918]

  Mr. Charles Clarke
  Since 2001, PricewaterhouseCoopers have made two inward secondments to the Department, one from October 2000–September 2001 in the Connexions Service and the other from July 20022013;March 2003 in the Sure Start Unit. Deloitte & Touche have made one secondment to the Department from November 2001–March 2004 in the Sure Start Unit. Ernst and Young have made one
  471W
  secondment to the Department from October 2000-March 2001 in School Leadership Division. There were no secondments from KPMG to the Department.

  There were no secondments from my Department to any of the companies listed during the period.

  School Transport
  Mr. McNamara
  To ask the Secretary of State for Education and Skills what measures in the draft School Transport Bill will ensure that pupils attending denominational schools of their particular faith are not put at a disadvantage for home-school transport arrangements. [165482]

  Alan Johnson
  The draft School Transport Bill contains powers that will allow Local Education Authorities (LEAs) to operate school travel schemes. The only group of pupils specifically protected in the draft Bill is those entitled to free school meals, who are protected from charges provided they attend their nearest suitable school. However, in the draft prospectus that was published alongside the draft Bill we remind LEAs that local schemes must comply with the European Convention on Human Rights, which requires LEAs to take account of the religious and philosophical beliefs of parents, particularly in respect of pupils from low income families who will probably depend on public transport to get to school.

  It is important that parents can choose a school in accordance with their religious convictions and in approving schemes, we will not expect LEAs to disturb well established arrangements for denominational transport, particularly where they are associated with local agreements or understandings about the sitting of denominational schools.

  Entrants to Postgraduate Research Courses1 in UK HE institutions

  Subject of course:

  Science2

  Engineering

  Technology

  Mathematical Sciences

  Other subjects

  All subjects

  1994–985

  9,575

  2,555

  535

  500

  8,243

  21,408

  1995–96

  8,852

  2,397

  476

  550

  8,954

  21,229

  1996–97

  8,662

  2,380

  469

  508

  8,934

  20,953

  1997–98

  9,181

  2,153

  507

  501

  8,726

  21,068

  1998–99

  11,070

  2,676

  745

  513

  10,256

  25,260

  1999–2000

  10,843

  2,604

  734

  554

  10,428

  25,163

  2000–01

  11,007

  2,936

  591

  529

  10,916

  25,979

  2001–02

  11,341

  2,724

  519

  638

  10,532

  25,754

  2002–033

  11,781

  2,827

  542

  671

  10,449

  26,271

  Source:

  Higher Education Statistics Agency (HESA) student record.

  1 Covers UK and overseas students taking Doctorates, Masters and other postgraduate courses mainly by research.

  2 Covers Medicine and Dentistry, subjects allied to Medicine, Biological Sciences, Veterinary Sciences, Agriculture and related subjects, Physical Sciences, Computer Sciences, Architecture, Building and Planning.

  3 Provisional.

  Chris Grayling
  To ask the Secretary of State for Education and Skills what proportions of state-supported PhD students beginning their courses in each of the last 10 years have studied scientific subjects. [152633]

  Alan Johnson
  The latest available information, for UK and EU students entering PhD courses in the UK, is shown in the table. Figures for earlier years are not available centrally.
  472W

  Postgraduate Study
  Chris Grayling
  To ask the Secretary of State for Education and Skills how many graduates have chosen to continue in higher education for a masters' year in each of the past ten years. [152630]

  Alan Johnson
  The latest available information, showing newly qualified graduates who went on to postgraduate study, is shown in the table. Comparable figures for earlier years are not held centrally. Figures for 2002–03 will be available in August 2004.

  Full-time UK Domiciled First Degree Graduates who went on to Study a Higher Degree1

  Number

  1994–95

  15,550

  1995–96

  15,585

  1996–97

  15,095

  1997–98

  15,525

  1998–99

  16,285

  1999–2000

  15,670

  2000–01

  16,005

  2001–02

  16,400

  Source:

  Higher Education Statistics Agenct's First Destinations Record.

  1 Covers taught and research higher degrees.

  Chris Grayling
  To ask the Secretary of State for Education and Skills how many research graduates have been recruited by universities in(a) science, (b) engineering, (c) technology and (d) mathematics in each of the past 10 years. [152631]

  Alan Johnson
  The latest available information is shown in the table. Figures for earlier years are not available centrally.

  Entrants to PhD courses in UK HEIs
  UK and EU domiciled students

  Total Entrants

  of which, % on science courses1

  1994–95

  10,167

  66

  1995–96

  10,078

  63

  1996–97

  9,466

  65

  1997–98

  9,586

  65

  1998–99

  11,478

  64

  1999–2000

  11,707

  63

  473W

  Entrants to PhD courses in UK HEIs
  UK and EU domiciled students

  Total Entrants

  of which, % on science courses1

  2000–01

  11,945

  643

  1995–96

  11,864

  64

  1996–97

  12,056

  66

  Source:

  Higher Education Statistics Agency (HESA) student record.

  1 Covers Medicine and Dentistry, subjects allied to Medicine, Biological Sciences, Veterinary Sciences, Agriculture and related subjects, Physical Sciences, Mathematical Sciences, Computer Sciences, Engineering and Technology, Architecture, Building and Planning.

  2 Provisional.

  School Closures
  David Hamilton
  To ask the Secretary of State for Education and Skills, what criteria are applied when making decisions on closing(a) rural schools and (b) urban schools. [165587]

  Stephen Twigg
  [holding answer 19 April 2004]: Under arrangements for local decision making School Organisation Committees and schools adjudicators must consider guidance issued by the Secretary of State when taking decisions on statutory proposals to close any school—rural or urban.

  The guidance emphasises that all proposals must be considered on their individual merit and in the light of local circumstances. It also provides a list of factors that must be considered. For school closures this includes: the impact on standards of provision in the area, the supply and demand for places, the cost effectiveness of proposals, the views of interested parties, the journey to alternative provision, the effect on the local community etc. The guidance also includes a presumption to approve proposals to close a failing school if there is to be a fresh start school established in its place.

  For proposals to close rural schools there is a presumption against the closure except where the case is strong and in the best interests of provision in the area. The guidance recommends that the transport implications of rural school closures should be considered and the overall effect on the community of closure of village schools. It also advises that the new provisions for federated and extended schools should be considered to increase the viability of rural schools before closure proposals are brought forward. There are no specific factors that apply to the consideration of urban school closures. More information can be found on the Department's School Organisation Website www.dfes.gov.uk/schoolorg.

  Education Grants
  Jim Knight
  To ask the Secretary of State for Education and Skills what grants were awarded to local authorities in Dorset by his Department in financial year 2003–04 that fall outside the revenue support grant. [156209]

  Mr. Miliband
  I refer my hon. Friend to the answer given by my right hon. Friend the Minister for Local and Regional Government the Member for Greenwich and Woolwich (Mr. Raynsford) on 1 March 2004,Official Report, column 750W.

  Computers Within Reach
  Mr. Field
  To ask the Secretary of State for Education and Skills how many(a) teachers and (b) families in Birkenhead have benefited from the Computers within Reach programme. [166323]

  Mr. Charles Clarke
  The Computers Within Reach scheme closed on 31 October 2001 having delivered over 24,000 recycled computers to people in 22 pilot areas, at a cost of £7.1 million over two years. Those eligible were in receipt of certain working age benefits or a State Pension with minimum income guarantee.

  At the same time as funding was made available for the Computers within Reach scheme, funding was also provided for the Computers for Teachers programme. For teachers who met certain criteria, this programme subsidised the cost of a computer. It was subsequently replaced by the current Laptops for Teachers scheme which dispensed with subsidies, and through which sufficient funding will be provided to enable two-thirds of teachers to receive a laptop by March 2006.

  Of the 24,000 computers delivered through the Computers within Reach scheme, approximately 3,000 were for people in the Liverpool area, including those in and around Birkenhead.

  Computer Services
  Bob Spink
  To ask the Secretary of State for Education and Skills what plans he has to update computer(a) hardware and (b) software standard packages used in his Department. [166373]

  Stephen Twigg
  We have no plans this year to make major replacements or upgrades to the Department's hardware base which is perfectly adequate for the current level of IT in use. Over the near to medium term, we expect the percentage of laptops in use by Departmental staff to increase as remote working facilities improve and the Department encourages increased flexibility of working patterns and closer working relationships across the education sector.

  The Department used predominantly Microsoft technology for its PC and back-office systems supplemented by "best of breed" technology for specific business critical activities. We have no plans to proactively update either our PC or server software this year although we do plan to introduce an improved email system (based on Microsoft's Exchange 2003), an integrated Human Resource and Payroll system, a Department-level accounting system and an Electronic Document and Records Management System (EDRMS) which will help us make better informed policy and allow us to respond positively to the Freedom of Information Act.

  Education (Birkenhead)
  Mr. Frank Field
  To ask the Secretary of State for Education and Skills, if he will make a statement on the effects on schools of changes since 1997 in the level of investment in school sports in Birkenhead. [166296]

  Stephen Twigg
  The Government is investing more than £1 billion in England to transform PE, school sport and club links. The funding will help to deliver an ambitious Public Service Agreement target, shared with
  475W
  the Department for Culture, Media and Sport. to increase the percentage of 5–16 year olds who spend a minimum of two hours each week on high quality PE and school sport within and beyond the curriculum to 75 per cent. by 2006.

  The Department is providing £1,376,176 to support the delivery of three School Sport Partnerships in the Wirrall LEA area. The partnerships include 14 secondary and 70 primary schools and provide enhanced sport opportunities for all young people. Furthermore, the New Opportunities Fund has allocated £4,448,000 to specifically enhance PE and school sport facilities in the Wirral LEA area.

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how much public funding has been spent on higher education in Birkenhead in each of the last seven years. [166320]

  Alan Johnson
  The only publicly funded institution providing higher education in Birkenhead is Wirral Metropolitan College. The College has three main campuses (two of which are in Birkenhead) and also operates through neighbourhood learning centers and in-company learning centers. In 2004–05 HEFCE will be providing nearly £1.5 million to Wirral Metropolitan College but we have no information on the proportion of this or previous funding spent through the two campuses in Birkenhead.

  Birkenhead Number of pupils achieving Level 4 +

  Mathematics Birkenhead Percentage of pupils achieving Level 4 +

  England Percentage of pupil achieving Level 4 +

  Birkenhead Number of pupils achieving Level 4 +

  English Birkenhead Percentage of pupils achieving Level 4 +

  England Percentage of pupils achieving Level 4 +

  2003

  689

  65

  73

  722

  68

  75

  2002

  770

  67

  73

  812

  70

  75

  2001

  747

  65

  71

  811

  70

  75

  2000

  720

  64

  72

  764

  68

  75

  1999

  735

  61

  69

  787

  66

  71

  1998

  538

  49

  59

  635

  58

  65

  1997

  552

  51

  62

  592

  55

  63

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills what percentage of 15 and 16 year-olds in Birkenhead achieved at least five GCSEs at grades A*—C or GNVQ equivalent in each of the last seven years. [166319]

  Mr Miliband
  The statistical information requested is detailed in the following table:

  Percentage of 15 year old pupils1 achieving five or more GCSE/GNVQ grades A*—C

  Academic Year

  Birkenhead Parliamentary Constituency

  England

  1997

  28.9

  45.1

  1998

  31.0

  46.3

  1999

  30.2

  47.9

  2000

  35.4

  49.2

  2001

  40.7

  50.0

  476W
  Eligible students attending designated courses at Wirral Metropolitan College are eligible for student support. The available figures for funding for these students are shown below. They relate only to spending on tuition fees, student loans (cash cost) and the Dependants Grant for full-time undergraduate students.

  Academic year

  Tuition fees £

  Student loans (cash cost) £

  Dependants Grants £

  1999–2000

  177,100

  652,300

  63,000

  2000–01

  172,100

  599,200

  70,200

  2001–02

  179,200

  664,500

  115,100

  2002–03

  175,600

  581,300

  145,000

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how many schools in Birkenhead deemed to be failing since 1997 have since reached satisfactory standards. [166328]

  Mr. Miliband
  One school in Birkenhead has been found to be failing since 1997 and has since recovered. A further Ofsted inspection in 2002 showed the school to be improving and providing a sound education for its pupils.

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how many and what percentage of 11 year old pupils in Birkenhead have reached level four in(a) mathematics and (b) English in each of the last seven years. [166330]

  Mr Miliband
  The information requested is as follows:

  Academic Year

  Birkenhead Parliamentary Constituency

  England

  2002

  44.0

  51.6

  2003

  45.9

  52.9

  1 Pupils are aged 15 at the start of the academic year, ie 31 August.

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how many and what percentage of pupils in Birkenhead reached the(a) mathematics and (b) English standard in each of the last seven years. [166329]

  Mr Miliband
  The results from the 2003 National Curriculum tests showed that 75 per cent. of 11 year olds in England reached Level 4 in English and 73 per cent. in mathematics. The results represent a significant improvement in standards—of 12 percentage points in English and 11 percentage points in mathematics—since 1997, reflecting the impact of the National Literacy and
  477W
  Numeracy Strategies on primary schools. We remain absolutely committed, through our new Primary Strategy, to supporting schools to achieve the ambitious targets we have set for standards of literacy and numeracy.

  The table shows the number and percentage of pupils in Birkenhead who have achieved level 4 or above in the Key Stage 2 English and mathematics tests since 1997. The results for Birkenhead are below the national average but show improvements since 1997 in English and mathematics in excess of the improvements in the national figures:

  1997

  1998

  1999

  2000

  2001

  2002

  2003

  English—No of pupils1

  592

  635

  787

  764

  811

  812

  722

  Mathematics—No of pupils1

  552

  538

  735

  720

  747

  770

  689

  English—%of pupils

  55

  58

  66

  68

  70

  70

  68

  Mathematics—% Pupils

  51

  49

  61

  64

  65

  67

  65

  1The number of eligible pupils for the Key Stage 2 tests varies slightly from year to year.

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how much funding each school in Birkenhead has received from New Deal for Schools. [166326]

  Mr. Miliband
  The table shows the schools in the Birkenhead constituency that benefited from investment through the New Deal for Schools (NDS) programme, which commenced in 1997–98. From 2000–01, capital allocations to local authorities and schools have largely been made by formulae linked to asset management plans. In addition, all schools have, since 2000–01, received Devolved Formula capital to use on their most urgent capital needs.

  NDS Allocations to Schools in the Birkenhead Constituency

  Year

  School

  Project Details

  Type

  Grant Awarded

  1997–98

  Bedford Drive Primary school

  Continuation of roofing and structural repairs

  LEA widegrant

  £375,000.00

  1998–99

  Devonshire Park Primary School

  Rebuild boundary wall to playground, stack and gutter repairs (North building)

  £49,500.00

  Holy Cross Catholic Primary School

  Structural repairs to infant building-design/construction fault

  £19,800.00

  Bidston Avenue Primary School

  Gutter repairs/renewal

  £8,800.00

  Park High School

  Fire precaution works, replacement of aluminium windows

  £82,500.00

  1999–2000

  The Priory Parish C of E Primary

  Part of roofing package

  £2,475.00

  478W

  NDS Allocations to Schools in the Birkenhead Constituency

  Year

  School

  Project Details

  Type

  Grant Awarded

  school

  Mersey Park Primary School

  Repair element roofing

  Project including 17 schools

  £950,300.00

  Woodchurch Road Primary School

  Heating boiler plant repairs

  Project including 13 schools

  £340,900.00

  Hillside Infant School

  Repair element structure

  Project including 15 schools

  £1,289,200.00

  Townfield Primary School

  Repair element structure

  Project including 15 schools

  £1,289,200.00

  St Oswald's Bidston C of E Primary School

  Repair element rooting

  Project including 17 schools

  £950,300.00

  Oxton St Savior's C of E Primary School

  Heating boiler plantreparis

  Project including 13 schools

  £340,900.00

  Our Lady and St Edward's Catholic Primary School

  Heating boiler plant repairs

  Project including 13 schools

  £340,900.00

  Holy Cross Catholic Primary School

  Heating boiler plant repairs

  Project including 13 schools

  £340,900.00

  St Joseph's Catholic Primary School

  Repair element structure

  Project including 15 schools

  £1,289,200.00

  Prenton High School for Girls

  Repair element roofing

  Project including 17 schools

  £950,300.00

  Rock Ferry High School

  Repair element roofing

  Project including 17 schools

  £950,300.00

  Ridgeway High School

  Repair element roofing

  Project including

  £950,300.00

  Plessington Catholic High School Technology College

  Heating boiler plant repairs

  Project including 13 schools

  £340,900.00

  2000–01

  Rock Ferry High School

  Temporary mobile accomodation to be replaced by permanent new build

  Project including 9 schools

  £1,955,856.00

  Ridgeway High School

  Temporary mobile accomodation to be replaced by permanent new build

  Project including 9 schools

  £1,955,856.00

  479W
  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how much public funding has been spent on repairing schools in Birkenhead in each year since 1997. [166304]

  Mr. Miliband
  The majority of capital support is allocated to schools and local education authorities by formula, and they decide how to invest it in line with

  All figures in £000s

  Wirral LEA Capital Allocations

  1997–98

  1998–99

  1999–2000

  2000–01

  2001–02

  2002–03

  2003–04

  Assistance With AMPS

  42

  Basic L C Vap

  61

  348

  453

  Basic Need

  1,468

  632

  1,793

  1,068

  344

  110

  251

  City Learning centers

  10

  2,200

  Class Size Initiative

  211

  899

  651

  66

  91

  Condition

  2,076

  3,108

  4,009

  Devolved Formula

  2,336

  1,922

  2,906

  4,590

  Early Excellence center

  195

  66

  Energy

  104

  Modernisation

  1,567

  2,911

  NDS 1

  375

  NDS 2

  1,902

  NDS 3

  2,712

  NDS 4

  3,956

  Nursery Provision

  70

  Outside Toilets

  36

  9

  Private Finance Initiative

  58,500

  School Labs

  224

  224

  School Security

  83

  103

  109

  108

  76

  65

  Schools Access Initiative

  30

  70

  150

  210

  349

  493

  726

  Seed Challenge

  217

  247

  424

  421

  Specialist Schools

  100

  200

  200

  Staff Workspace

  84

  176

  Supplementary Credit Approvals

  55

  684

  Supplementary NDS for VA Schools

  146

  Targeted Capital Funding

  600

  1,316

  Targeted Capital Funding—VA

  3,921

  Voluntary Aided School Grant

  399

  682

  937

  341

  352

  763

  Total

  2,410

  4,619

  6,717

  67,937

  8,717

  10,159

  18,774

  Additionally, we have allocated to date approximately £13.4 million in 2004–05 and £5.3 million in 2005–06 for further capital investment in schools in Wirral LEA.

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how many teaching assistants there were in schools in Birkenhead (a) in each of the last seven years and (b) on the latest date for which figures are available. [166299]

  Mr. Miliband
  In the Birkenhead constituency there were 210 full-time equivalent teaching assistants in service in maintained schools in January 2003. This is the latest information available. The table gives the corresponding numbers since 1997.

  Year

  1997

  90

  1998

  90

  1999

  110

  2000

  110

  2001

  170

  2002

  150

  Source:

  Annual School's Census.

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  their asset management plans. The Department does not, therefore, have complete information about capital investment at constituency level. The table sets out the capital support made by the Government to Wirral Local Education Authority since 1997–98, in total and by programme, including devolved formula capital grants to each school.

  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how many teacher vacancies there were in Birkenhead on the latest date for which figures are available; and what steps he is taking to reduce them. [166298]

  Mr. Miliband
  Teacher vacancy information is collected at local authority level. In January 2003, there were 18 vacancies for full-time teachers in maintained schools in the Wirral local education authority (LEA) area, which includes Birkenhead.

  Like other areas, since 1997 Wirral has benefited from the initiatives that the Government has put in place to recruit and retain teachers and to increase the number of staff supporting them in schools. Since 1997, the number of full-time equivalent regular teachers in maintained schools in Wirral LEA has risen by 150, from 2,930 to 3,080 in 2003. Over the same period, the number of full-time equivalent school support staff in the LEA has grown by 690, from 680 to 1,370.

  Sex Education
  Dr. Stoate
  To ask the Secretary of State for Education and Skills what progress has been made since 16 July 2003 on establishing a set of guidelines on sex education for boys. [166546]

  Stephen Twigg
  We have commissioned the development of practical guidance to support schools in Sex and Relationship Education (SRE) for boys and young men. The guidance will be available in early June.

  Additionally since July 2003, we have supported the production of a resource for teaching and learning about HIV and AIDS which addresses both boys and girls. Our programme of professional development which includes a specialist module of SRE will be available to up to 3,000 teachers in 2004–05. These participants are required to demonstrate that their SRE programme meet the needs of both boys and girls.

  Student Loans
  Dr. Cable
  To ask the Secretary of State for Education and Skills how much interest accrued to the Student Loan Company on student loans in financial years(a) 2002–03 and (b) 2003–04; and how much of this interest was derived from capital sums which had been paid by debtors to the Inland Revenue but not transferred to the Student Loan Company. [166116]

  Alan Johnson
  In financial year 2002–03, the sum of £146.8 million in interest was added onto the student loans balance. Of this, £106.9 million related to income contingent loans and £39.9 million related to mortgage style loans. Any adjustments arising from the repayments received in respect of 2002–03 will be included in the 2003–04 data.

  Data are not available to answer the second part of the question.

  Data for financial year 2003–04 are not yet available.

  Teachers (North Somerset)
  Brian Cotter
  To ask the Secretary of State for Education and Skills how many(a) teaching assistants, (b) teachers and (c) teaching vacancies there were in schools in the North Somerset Education Authority in each year since 1997. [165679]

  Mr. Miliband
  [holding answer 19 April 2004]: The table shows the number of full-time equivalent teaching assistants, regular teachers and full-time permanent teacher vacancies in maintained schools in North Somerset Local Education Authority area, in January of each year since 1997.
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  Teachers assistants

  Teachers

  Vacancies

  1997

  190

  1,450

  9

  1998

  220

  1,380

  12

  1999

  220

  1,360

  10

  2000

  260

  1,360

  14

  2001

  290

  1,420

  7

  2002

  310

  1,480

  5

  2003

  380

  1,490

  7

  Sources:

  Annual School Census (teaching assistants) and the Annual Survey of Teachers in Service and Teacher Vacancies.

  Teaching Assistants (Wirral)
  Mr. Chapman
  To ask the Secretary of State for Education and Skills how many teaching assistants there were in schools in Wirral South in (a) each of the last seven years and (b) on the latest date for which figures are available. [166625]

  Mr. Miliband
  In the Wirral South constituency there were 130 full-time equivalent teaching assistants in service in maintained schools in January 2003. This is the latest information available. The table gives the corresponding numbers since 1997.

  Year

  1997

  50

  1998

  50

  1999

  50

  2000

  60

  2001

  80

  2002

  100

  Source:

  Annual School's Census.

  Excellence in Cities
  Mr. Frank Field
  To ask the Secretary of State for Education and Skills how many children in Birkenhead have benefited from the Excellence in Cities programme; and what the per pupil spending was in each year since the programme's inception. [166327]

  Mr Miliband
  Park High School, Prenton High School Ridgeway High School, Rock Ferry High School and Woodchurch High School in Birkenhead have been included in Excellence in Cities since September 2000. The table below shows the number of children in Birkenhead benefiting, and the annual spend per pupil for the years in question.

  No of Children

  Total EiC expenditure1 £

  Spend per Pupil £

  2000–01

  4,870

  675,311

  138.67

  2001–02

  5,056

  675,311

  133.57

  2002–03

  5,141

  726,028

  141.22

  2003–04

  5,284

  1,437,340

  272.00

  1 Funding figures were supplied by the Excellence in Cities coordinator for Wirral.

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  The large increase in the rate of EiC funding in 2003–04 is due to the extra funding provided through the Leadership Incentive Grant and Behaviour Improvement Programme which came on stream in 2003.

  Supply Teachers
  Mr. Andrew Hunter
  To ask the Secretary of State for Education and Skills, if he will take measures to ensure that only local education authority-approved teachers can be employed by schools as supply teachers. [166412]

  Mr. Miliband
  My right hon. Friend has no present plans to take such measures. However, the Government has already taken action to improve the quality and reliability of supply teachers. A package of self-study materials was launched in June 2002 specifically for supply teachers. In addition, my Department's Quality mark scheme requires that teachers being offered to schools by agencies and Local Education Authorities have been interviewed and their references checked. I plan to write to schools soon recommending that they use Quality Mark holders for fulfilling their supply needs wherever possible.

  1997

  1998

  1999

  2000

  2001

  2002

  2003

  English—no.of pupils1

  665

  708

  757

  772

  797

  819

  767

  Mathematics—no. of pupils1

  633

  633

  727

  723

  742

  774

  733

  English—%of pupils

  76

  76

  81

  83

  86

  84

  84

  Mathematics—%of pupils

  72

  68

  78

  78

  80

  79

  80

  1 The number of eligible pupils for the Key Stage 2 tests varies slightly from year to year.

  Mr. Ben Chapman
  To ask the Secretary of State for Education and Skills how many teacher vacancies there were in Wirral South on the latest date for which figures are available; and what steps he is taking to reduce them. [166626]

  Mr. Miliband
  Teacher vacancy information is collected at local authority level. There were 18 vacancies for full-time teachers in maintained schools in the Wirral local education authority (LEA) area, which includes Wirral South.

  Like other areas, since 1997 Wirral has benefited from the initiatives that the Government has put in place to recruit and retain teachers and to increase the number of staff supporting them in schools. Since 1997, the number of full-time equivalent regular teachers in maintained schools in Wirral LEA has risen by 150, from 2,930 to 3,080 in 2003. Over the same period, the number of full-time equivalent school support staff in the LEA has grown by 690, from 680 to 1,370.

  Temporary Classrooms
  Bob Russell
  To ask the Secretary of State for Education and Skills how many temporary or demountable classrooms in the Colchester

  Schools (Wirral, South)
  Mr. Ben Chapman
  To ask the Secretary of State for Education and Skills how many and what percentage of pupils in Wirral South reached the(a) mathematics and (b) English standard in each of the last seven years. [166623]

  Mr. Miliband
  The results from the 2003 National Curriculum tests showed that 75 per cent. of 11-yearolds in England reached Level 4 in English and 73 per cent. in mathematics. These results represent a significant improvement in standards—of 12 percentage points in English and 11 percentage points in mathematics—since 1997, reflecting the impact of the National Literacy and Numeracy Strategies on primary schools. We remain absolutely committed, through our new Primary Strategy, to supporting schools to achieve the ambitious targets we have set for standards in literacy and numeracy.

  The table shows the number and percentage of pupils in Wirral South who have achieved level 4 or above in the Key Stage 2 English and mathematics tests since 1997. The results for Wirral South are well above the national average and have improved significantly since 1997:

  Parliamentary constituency have been replaced with permanent accommodation since May 1997; and if he will make a statement. [165328]

  Alan Johnson
  The Department does not hold data on the replacement of temporary classrooms since 1997. This Government has increased its support for capital investment in schools from under £700 million in 1996–97 to £3.8 billion this year and this will increase further to over £5 billion by 2005–06. The bulk of schools capital is now allocated by formula to Authorities and schools so that they can address their local priorities, including the replacement of decayed temporary accommodation, on which we have set a high priority. Prioritisation of need is through asset management planning, which should be an open, rigorous and consultative process, based on a survey of the needs of all schools, Modern, high-quality mobile or demountable classrooms provide a good environment for teaching and learning where there is short-term need. They might, for instance, be needed to cope with a short-term increase in pupil numbers, or where extensive remodelling or rebuilding of permanent accommodation means providing temporary accommodation on the school site, rather than transporting children elsewhere.

  Pupil Referral Units
  Mr. Hoban
  To ask the Secretary of State for Education and Skills what the average length of attendance at pupil referral units was in each of the last three years. [165475]

  Alan Johnson
  The data requested is not collected centrally.

  School Refurbishment
  Mr Simmonds
  To ask the Secretary of State for Education and Skills how much funding his Department(a) has spent in 2003–04 and (b) is planning to spend in (i) 2004–05 and (ii) 2005–06 on rebuilding and refurbishing property in (A) secondary schools and (B) further education colleges. [165351]

  Alan Johnson
  The majority of the Department's school capital investment is allocated to schools and Local Education Authorities (LEAs) by formula, and they decide how best to invest it in line with their asset management plans. We do not stipulate how LEAs should split this investment between primary and secondary schools and we do not, therefore, have detailed information about all capital investment spent on secondary schools. This information should be held locally. The total capital investment available for all schools amounted to £3.8 billion in 2003–04, and we have indicated that this will rise to £4.5 billion and £5.1 billion in 2004–05 and 2005–06 respectively.

  Maintained Primary and Secondary Schools 1: Number (headcount) of Pupils Position as at January each year: Devon Plymouth and Torbay Local Education Authorities

  Devon Maintained secondary

  Plymouth Maintained secondary

  Torbay Maintained secondary

  Maintained Primary

  Total secondary

  of which grammar schools

  Maintained Primary

  Total secondary

  of which grammar schools

  Maintained Primary

  Total secondary

  of which grammar schools

  19972

  84,938

  62,047

  5,619

  —

  —

  —

  —

  —

  —

  19982

  88,639

  62,991

  5,693

  —

  —

  —

  —

  —

  —

  1999

  56,454

  37,592

  727

  21,887

  18,254

  2,481

  10,254

  8,467

  2,607

  2000

  56,374

  38,816

  731

  21,510

  18,645

  2,597

  10,288

  8,552

  2,654

  2001

  56,503

  39,832

  732

  21,285

  18,829

  2,645

  10,328

  8,708

  2,697

  2002

  56,159

  40,872

  745

  20,968

  18,982

  2,679

  10,399

  8,863

  2,738

  2003

  55,679

  41,696

  741

  20,431

  19,008

  2,709

  10,325

  9,024

  2,722

  Source:

  Annual Schools' Census

  1 Includes middle schools as deemed.

  2 Before Local Government Reorganisation.

  Public Bodies
  Mr. Stephen O'Brien
  To ask the Secretary of State for Education and Skills what the(a) resource budget, (b) administration costs and (c) staff numbers were for 2003 of the (i) School Teachers' Review Body and (ii) Music and Dance Scheme Advisory Group. [165122]
  486W
  All of the Department's post-16 learning and skills sector capital investment is allocated to the Learning and Skills Council (LSC). In 2003–04 the LSC's total capital funding allocation was £327.5 million, and we have indicated that this will rise to £379.5 million and £408.5 million in 2004–05 and 2005–06 respectively. This comprises capital funding for the further education and Adult and Community Learning sectors. It includes funding to develop the Information and Learning Technology infrastructure; to develop centers of Vocational Excellence; and to support the Neighbourhood Learning in Deprived Communities programme. The Department does not provide a specific budget to the LSC for rebuilding and refurbishing property in further education colleges. It is for the LSC to determine for itself the right level of capital investment in further education colleges. Mr. Haysom, the Council's Chief Executive, will write to the hon. Member on this matter. A copy of his reply will be placed in the House library.

  Devon Schools
  Mr. Swire
  To ask the Secretary of State for Education and Skills how many places there were in Devon Local Education Authority(a) primary, (b) secondary and (c) grammar schools in each of the last seven years. [165016]

  Alan Johnson
  The available information shown in the table relates to the number of pupils in maintained primary and secondary schools and grammar schools rather than total number of school places.

  Alan Johnson
  The School Teachers' Review Body (STRB) does not have a specific budget. Its costs are borne within the overall total budget for the Office of Manpower Economics. The estimated resource budget for the work of the STRB in 2003–04, including members' costs and consultancy and survey work was about £840,00 and this includes Secretariat
  487W
  administration costs, including pay, of £384,000. The STRB is supported by a Secretariat of 7.8 people within the Office of Manpower Economics.

  The Music and Dance Scheme Advisory Group (MDSAG) does not have a resource budget. The
  488W
  Group's members are unpaid and only receive expenses for attendance at meetings. These amounted to some £6,000 in 2003–04. The MDSAG is serviced by two officials from the Department of Education and Skills as part of their duties in administering the Music and Dance Scheme.

ENVIRONMENT, FOOD AND RURAL AFFAIRS

  Flood Defence Finding Review
  The Minister for the Environment (Mr. Elliot Morley)
  On 12 March 2003 my right hon. Friend the Secretary of State announced the conclusions of our review of the funding and administrative arrangements for delivering a more efficient, effective and accountable flood and coastal defence service. A year on I want to update the House on the progress we have made towards implementing these conclusions, and outline what remains to be done.

  We have set in hand arrangements for the Environment Agency to receive a single stream of Defra grant in aid funding from 1 April 2004. This will replace the previous mix of Defra grant for individual capital projects and, in large part, the levies previously raised through local authorities. This should provide the agency with more certainty of funding, allowing them to plan more strategically, while streamlining the procedures associated with implementing flood defence schemes. In future Defra approval will no longer be required for agency projects or strategies which are below £5 million though we will have the opportunity to call in strategies, and projects undertaken outside strategies, which are between £2 million and £5 million. We will also continue to ensure that the distribution of capital funding between the agency and other operating authorities (local authorities and internal drainage boards) is based on our priority scoring system which takes account of the number of people affected in relation to the cost of the project, the environment and benefit cost ratio.

  Payment of grant in aid will be linked to robust targets in the agency's corporate plan. The agency may continue to raise limited levies on local authorities, agreed through flood defence committees on which local authorities have a majority, to fund locally important flood defence works beyond Close covered by Defra funding. These local levies are set to raise some £24.4 million in 2004–05.

  Work has also started on the procedures for transferring to the Environment Agency responsibility for those watercourses representing the greatest flood risk—the so-called critical ordinary watercourses. This will significantly improve accountability for flood risk with over 2,000 separate lengths of river identified for transfer. The necessary statutory procedures will start shortly with transfers taking place in stages until April 2006. Day to day management of the watercourses can be contracted back to internal drainage boards and local authorities where this is appropriate and agreed. As part of this exercise we are fully digitising the existing main river maps.
  8WS
  The Government also announced the intention to move to a single tier of flood defence committee to remove the bureaucracy and second-guessing of decisions involved in having two tiers of committee in several Environment Agency regions. The Environment Agency has consulted on the proposed successor arrangements and I expect to receive their recommendations for future structures within the next month. I shall consider their proposals and bring forward orders as appropriate.

  We have also made progress on a number of other important initiatives to help improve the accountability and delivery of the flood defence service. From 1 April 2004 internal drainage boards will fall under the jurisdiction of the local government ombudsman and we have developed a complaints procedure for individual boards to adopt.

  We are also working with the Association of Drainage Authorities and the Environment Agency to develop new targets for the administration and membership of boards but in the meantime I am encouraged that arrangements are already being made for 16 existing boards to merge into three larger boards in the Anglia region, and discussions are taking place in other regions.

  Jointly with the Environment Agency we have considered ways in which overheads associated with capital schemes can be reduced. We will be implementing agreed findings and targets for overhead reduction will appear in the agency's corporate plan.

  We will be assessing the benefits realised through implementation of these conclusions as part of a three-year review which we will undertake in 2007.

  Whilst the funding review conclusions are being taken forward, Defra is simultaneously leading work on a new Government wide strategy for flood and coastal erosion risk management to be underpinned by the principles of sustainable development. This is being taken forward in full consultation with stakeholders and will look across all Government policies. As part of the strategy we are undertaking further work on possible new funding streams to go alongside Exchequer funding which, as we announced last March, will continue primarily to fund the service. We intend that the new strategy will steer the direction of policy over the next 10–20 years and that it will be completed in the coming financial year.

  Defra, the Environment Agency and others are putting great effort into implementing the funding review outcomes and developing a new long-term strategy. Implementing flood defence grant in aid from this April is a notable achievement and other substantial reforms to improve accountability and effectiveness will be in place in the next 12 to 24 months.

WORK AND PENSIONS

  Benefit Fraud Inspectorate (Ealing Council)
  The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond)
  On behalf of my right hon. Friend the Secretary of State for Work and Pensions, the Benefit Fraud Inspectorate (BFI) follow-up inspection report on London Borough of Ealing Council was published on 14 April 2004 and copies of the report have been placed in the Library.
  9WS
  Following the housing green paper "Quality and Choice: A Decent Home for All", published in April 2000, the Department for Work and Pensions developed a performance framework for housing benefits. The "performance standards for housing benefits" allow local authorities to make a comprehensive self-assessment of whether they deliver benefit effectively and securely. They are the Standards that the Department for Work and Pensions expects local authorities to aspire to and achieve in time.

  The BFI inspected London Borough of Ealing Council against the Performance Standards for housing benefits. The report finds that the council is not at Standard for any of the seven functional areas of the Performance Standards—strategic management, customer services, processing of claims, working with landlords, internal security, counter-fraud, and overpayments.

  However, the report finds that the council had made sustained improvements in a number of areas since the first BFI inspection report published in December 2000. The council:
  had significantly reduced its backlog of work from 46,000 items to 4,000; was processing housing benefits claims faster; had reduced the amount of time that customers wait when they make an enquiry by telephone or in person; had reduced the number of complaints and increased the level of satisfaction reported by customers; and had prosecuted more benefit fraudsters.

  Weaknesses still remained in the controls for internal fraud and for recovering overpayments of benefit. The council still needs to do more to better manage its counter-fraud effort and, in particular, to deter fraud.

  The council had improved its processing times for new claims to benefit and changes of circumstances, taking an average 51 days to process claims and 15 days to process changes of circumstances compared to the national standards of 36 and 9 days.

  The council had carried out a number of good quality fraud investigations. During 2002–03, it had prosecuted 18 fraudsters compared to one during 1999–00 putting it in the top 25 per cent. of performers compared with the other London boroughs.

  In 2002–03, London Borough of Ealing Council administered some £121.2 million in housing benefits, about 18 per cent. of its gross revenue expenditure.

  The report makes recommendations to help the council address weaknesses and to further improve the administration of housing benefit and council tax benefit, as well as counter-fraud activities.

  My right hon. Friend the Secretary of State is now considering the report and will be asking the council for its proposals in response to the BFI's findings and recommendations.

  Benefit Fraud Inspectorate (Leicester City Council)
  The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond)
  On behalf of my right hon. Friend the Secretary of State for Work and Pensions, the benefit fraud inspectorate (BFI) inspection report on Leicester city council was published on 15 April 2004 and copies of the report have been placed in the Library. Following the housing green paper "Quality and Choice: A Decent Home for All", published in April 2000, the Department for Work and 10WS
  Pensions developed a performance framework for housing benefits. Tile performance standards for housing benefits allow local authorities to make a comprehensive self-assessment of whether they deliver benefit effectively and securely. They are the standards that the Department for Work and Pensions expects local authorities to aspire to and achieve in time.

  The BFI inspected Leicester city council against the performance standards for housing benefits. The report finds that the council is not at standard for any of the seven functional areas of the performance standards—strategic management, customer services, processing of claims, working with landlords, internal security, counter-fraud and overpayments.

  However, the report notes the considerable efforts made by members, senior officers and staff over a sustained period of time.

  The report finds that the council had a backlog of around 14,500 cases, poor IT reliability, insufficient management information which together with limited planning had hindered the council's ability to deliver an effective benefits service. This had resulted in new benefit claims and changes of circumstances taking 141 days and 49 days to process during 2002–03.

  Although processing, times were taking too long, the quality of processing and verification of claims was found to be of a good standard. However, the lack of effective management checks meant that the council had only limited assurance that benefits were being paid correctly and securely. Also, customers were experiencing problems trying to access the benefits service by telephone.

  The quality of fraud investigation work was good and all investigation officers were trained to professional standards. However, limited resources and weaknesses in the planning of investigation work were undermining efforts to secure the benefits system.

  In 2002–03, Leicester city council administered some £97 million in housing benefits, about 16 per cent. of its total gross revenue expenditure.

  The report makes recommendations to help the council address weaknesses and to further improve the administration of housing benefit and council tax benefit, as well as counter-fraud activities.

  My right hon. Friend the Secretary of State is now considering the report and will be asking the council for its proposals in response to the BFI's findings and recommendations.

NORTHERN IRELAND

  New Targeting Social Need
  The Secretary of State for Northern Ireland (Mr. Paul Murphy)
  I wish to advise the House that on 14 April 2004 I launched a public consultation exercise in respect of a proposed way forward for new targeting social need (New TSN), the Government's high level policy for tackling poverty and social exclusion in Northern Ireland.

  By undertaking this consultation we are fulfilling a commitment given by the previous Northern Ireland Executive, in its programme for Government, to review the New TSN policy.
  11WS
  Copies of the consultation paper "New TSN—the Way Forward Towards an Anti-Poverty Strategy" have been placed in the Libraries of both Houses.

  Water Resource Strategy
  The Minister of State, Northern Ireland Office (Mr. John Spellar)
  Today I am publishing the Water Service's Water Resource Strategy 2002–30.

  The Strategy provides a framework for meeting increasing water demand in Northern Ireland, through the efficient use of water including leakage reduction and by upgrading and rationalising the existing supply system.

  An Executive Summary of the Strategy has been placed in the Libraries of both Houses and is available on the Water Service website at www.waterni.gov.uk.

DEFENCE

  Joint Medal Office
  The Parliamentary Under-Secretary of State for Defence (Mr. Ivor Caplin)
  As part of a wider modernisation of service personnel administration policies and the procedures and the introduction of the IT to support their delivery known as the joint personnel administration (JPA) programme, and following an investment appraisal and consultation with trade unions, the decision has been taken to concentrate the delivery of JPA from three sites: Innsworth, Gosport and Glasgow.

  This will incorporate the creation, from March 2005, of a joint medal office at Innsworth the current location of the RAF medal office and will involve the phased closure of the army medal office at Droitwich and the Royal Navy and Royal Marines medal offices located at Gosport. In order to provide continuity of service and to build up the necessary expertise at Innsworth the transfer of responsibilities will be phased.

  Consultation with MOD Trade Unions about the choice of the three sites from which JPA will be delivered has been undertaken and detailed local consultation about the implications for staff will start shortly. It is expected that some of the current staff will transfer to Innsworth with the work. It is anticipated that staff at Gosport and Innsworth who are unable to transfer to the JMO will be found other positions in the locality, but I cannot rule out a programme of early retirement and redundancy that may be required in particular at Droitwich.

DEPUTY PRIME MINISTER

  Neighbourhood Wardens Scheme
  The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Yvette Cooper)
  The Government is today publishing a research report and research summary entitled "Neighbourhood Wardens Scheme Evaluation". This evaluation of the neighbourhood wardens scheme, undertaken by Social Development Direct, concludes that, in successful schemes, wardens are laving a significant impact. Neighbourhood wardens schemes represent value for 12WS
  money in relation to crime reduction. There are also important, but uncosted, additional benefits—improved quality of life, reduced fear of crime, improvements in environmental problems and antisocial behaviour.

  Copies of the research report and summary are available at www.neighbourhood.gov.uk and in the Library of the House.

  Regional Planning Guidance (North-West)
  The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Yvette Cooper)
  The North West Regional Assembly (NWRA) published, on 19 April, a consultative draft of the Partial Review of Regional Planning Guidance for the North West (RPG13) that was published by my right hon. Friend, the Deputy Prime Minister in March 2003.

  RPG13 sets out the spatial development strategy that encompasses proposals for the development of the Region's economy, housing and transport infrastructure, and other land uses. It also sets out proposals for the conservation, management and enhancement of the Region's natural and cultural environment.

  Regional Planning Guidance also provides the regional framework for the plans and strategies of a range of public, private and voluntary organisations, including the preparation of local authority Development Plans and Local Transport Plans.

  The consultation will also allow consideration of the implications of the Northern Way growth work being led by the Regional Development Agencies.

  The selective, partial, review covers a number of key matters of importance to the future of the region, including:
  Transport—The Regional Transport Strategy is updated in the light of a number of major studies in the region and consultations on national aviation policy. The review also includes transport investment priorities, the management of the regional highway network, a regional freight strategy and criteria to ensure that new developments are accessible by public transport;
  Sustainable energy—targets are put in place that should help to increase the amount of energy supplied from renewable resources;
  Waste management—a new approach to handling waste is set out that will encourage recycling and composting, and reduce landfill;
  Climate change—a new policy on climate change is introduced that will aim to meet greenhouse gas reduction targets and allow planning for the implications of climate change;
  Strategic Regional Parks—three broad areas of search for Strategic Regional Parks are identified based on the North West Coast. the Mersey Belt and East Lancashire; and
  Strategic Views along the River Mersey—a policy to protect and enhance selected views for different parts of the Mersey valley is put forward.

  The draft Partial Review is published for consultation with all regional stakeholders over a period of 12 weeks. An independent Panel will take into account all responses to the consultation before it hole s a Public Examination in November, where it will consider the issues arising from the consultation. The Panel will

  13WS
  produce a report for the First Secretary of State, who will then publish the final version of the RPG following further consultation, in 2005.

  Copies of the relevant documents are available in the Libraries of both Houses and have been provided for all of the Region's MPs. MEPs and local authorities.

INTERNATIONAL DEVELOPMENT

  Afghanistan
  The Secretary of State for International Development Hilary Benn)
  The Foreign Secretary, the Minister for Trade and Investment and I attended the donor conference on Afghanistan held in Berlin on 31 March and 1 April, at which donors were invited to respond to the recent needs assessment compiled by the World Bank.

  The conference was an opportunity for donors to: assess the political progress that has taken place in Afghanistan since the Bonn and Tokyo conferences of 2001 and 2002; discuss the challenges that now face the Afghan Government; and demonstrate continued commitment to Afghanistan's long-term future development.

  The announcement by President Karzai of the plan to hold elections in September was warmly welcomed. At a side meeting donors pledged an additional $65 million to the election process, helping to keep it on track. The UK pledged an additional $5 million, taking our overall election funding to $24 million. Preparations for elections are on course although security for a free and fair election remains a major concern.

  Donors demonstrated their commitment to Afghanistan, by pledging US$8.2 billion of assistance over the next three years. This represents two thirds of Afghanistan's requirements over this period, and it is hoped folly to meet Afghanistan's needs with increased money becoming available from donors that were only able to make one-year pledges in Berlin. Of this new pledge over half, US$4.5 billion, is for this financial year. This meets Afghanistan's request for the year and is more than double the amount disbursed in Afghanistan last year. This increase comes at an important time, as a number of Government programmes become effective and the Government's capacity to absorb funds and implement programmes increases.

  As I outlined in my statement to Parliament prior to the conference, 1 March 2004, Official Report, column 74WS, I announced an increase of the UK's commitment to Afghanistan from £200 million over five years to at least £500 million over the same period. This funding is to support a range of reconstruction work, support for conflict prevention, and the counter narcotics effort. A booklet outlining DFID's programme in Afghanistan has been placed in the Library of the House.

  Many donors acknowledged the particular challenges that both drugs and the security situation present to Afghanistan's successful development. I emphasised to the conference the UK's commitment as lead donor to tackling the opium industry in Afghanistan, and many other donors also acknowledged the importance of dealing with this. The UK's specific provision of
  14WS
  £70 million over three years to tackle this problem is an important lead and we are working closely with other donors to increase their funding in this area and to ensure that all development assistance is delivered in a way which supports counter-narcotics objectives. In the light of the importance that the conference attached to this problem, it was also a real achievement for the Afghan Government that they signed the Berlin Declaration on Co inter Narcotics with the six signatories to the Good Neighbourly Relations Declaration, agreeing a common stance on tackling drugs in the region.

TRANSPORT

  Dibden Bay Port Terminal
  The Parliamentary Under-Secretary of State for Transport (Mr. Tony McNulty)
  I am today issuing the decision on the proposals submitted by Associated British Ports to develop a new container port at Dibden Bay, near Southampton. The Inspector's report of the public inquiry held into the proposals between November 2001 and December 2002 is also being published today.

  The decision and the reasons for it are set out in the decision letter.

  After carefully considering the Inspector's report and taking into account all relevant considerations, I have decided to refuse permission for the port development, in line with the Inspector's recommendation.

  The Government fully recognise the nation's and industry's needs for additional container port capacity in order to meet future economic demand. Every proposed port development must nevertheless be justified on its own merits.

  One important factor in the making of this decision was the environment al impact of the proposals on internationally protected sites.

  A copy of the decision letter has been placed in the House Library.

FOREIGN AND COMMONWEALTH AFFAIRS

  Council of the European Union
  The Minister for Europe (Mr. Denis MacShane)
  The forthcoming business in the Council of the European Union is as follows:

  Date

  Location

  Event

  April

  26–27

  Brussels

  General Affairs & External Relations (GAERC)

  26–27

  Brussels

  Agriculture & Fisheries Council

  27

  Luxembourg

  EU/Russia Permanent Partnership Council (Troika)

  29–30

  Brussels

  Meeting of the Economic and Financial Committee

  29–30

  Brussels

  Justice & Home Affairs (Ministerial Informal)

  May

  1

  Dublin

  Enlargement Event

  4–6

  Dublin

  EuroMed Foreign Ministers

  6–7

  Botswana

  EU-ACP Council of Ministers

  15WS

  Date

  Location

  Event

  7

  Limerick

  Meeting of Ministers with responsibility for Equality

  9–11

  Killarney

  Agriculture Informal Ministerial Meeting

  10

  Brussels

  Meeting of Eurogroup

  11

  Brussels

  ECOFIN

  11–12

  Cork

  Health Ministers Consultative Meeting

  14–16

  Waterford

  Informal Meeting of EU Environment Ministers

  17–18

  Brussels

  General Affairs & External Relations (GAERC)

  19–20

  Offaly

  Informal Budget Committee

  21

  Moscow

  EU/Russia Summit (Troika)

  23–25

  Brussels

  Agriculture & Fisheries Council

  24–25

  Brussels

  Meeting of the Economic and Financial Committee

  24–25

  Brussels

  Agriculture & Fisheries Council

  25–27

  Co. Galway

  Conference on Islands and Territorial cohesion-Meeting New Challenges

  27–28

  Brussels

  Educatio 1, Youth & Culture Council

  27–31

  Dublin

  Ministers and Directors General of Public Administration

  28

  Guadalajara

  EU-Lath America/Caribbean Summit

  June

  1–2

  Luxembourg

  Health Council

  1

  Dublin

  Development Ministers' Meeting

  1

  Luxembourg

  Meeting of Eurogroup

  2

  Luxembourg

  ECOFIN

  8

  Luxembourg

  Justice & Home Affairs Council Meeting

  10–11

  Luxembourg

  Transport, Telecom & Energy Council

  14–15

  Luxembourg

  General Affairs & External Relations (GAERC)

  17–18

  Brussels

  EUROPEAN COUNCIL

  21–22

  Luxembourg

  Agriculture & Fisheries Council

  21–22

  Brussels

  Meeting of the Economic and Financial Committee

  25–26

  tbc

  EU-US Summit

  28–29

  Luxembourg

  Council Meeting of EU Environment Ministers

  16WS

  Date

  Location

  Event

  July

  Brussels

  Coreper 2

  2–3

  Maastricht

  Competitiveness (Informal)

  7

  Brussels

  Coreper 1

  7–8

  Brussels

  Coreper 2

  8

  tbc

  EU-Ukraine Summit

  8–10

  Maastricht

  Social Policy (Informal)

  9–10

  Amsterdam

  Transport (Informal)

  12–13

  Brussels

  General Affairs & External Relations (GAERC)

  12–14

  Rotterdam

  Informal Ministerial Education Youth and Culture

  14

  Brussels

  Coreper 1

  15

  Brussels

  Coreper 2

  16–18

  Maastricht

  Environment (Informal)

  19

  Brussels

  JHA Council

  19

  Brussels

  Agricultural & Fisheries Council

  22

  Brussels

  Coreper 2

  23

  Brussels

  Coreper 1

  August

  No meetings planned

  September

  1

  Brussels

  Coreper 1

  2

  Brussels

  Coreper 2

  3–4

  Maastricht

  Gymnich

  5–7

  Noordwijk

  Agriculture & Fisheries (Informal)

  8

  Brussels

  Coreper 1

  8

  Brussels

  Coreper 2

  9–10

  Noordwijk

  Health (Informal)

  11

  Sheveningen ECOFIN

  13–14

  Brussels

  GAERC

  15

  Brussels

  Coreper 1

  16

  Brussels

  Coreper 2

  17

  Brussels

  Coreper 1

  17–18

  Noordwijk

  Informal Ministerial Defence

  20–21

  Brussels

  Agricultural & Fisheries Council

  22

  Brussels

  Coreper 1

  22

  Brussels

  Coreper 2

  24

  Brussels

  Competitiveness Council

  27

  Brussels

  (Possible) Council Transport, Telcom and Energy

  29

  Brussels

  Coreper 1

  29

  Brussels

  Coreper 2

  30

  Den Haag

  JHA (Informal)

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

The Lord Chancellor: Leave of Absence
The Lord Chancellor (Lord Falconer of Thoroton): My Lords, before business begins, may I take the opportunity to inform the House that I will be attending an official engagement in Nottinghamshire on Friday 23 April when the House will sit? Accordingly, I trust that the House will grant me leave of absence.

Parkinson's Disease
2.37 p.m.
Lord Harrison Lord Harrison asked Her Majesty's Government:
How they are planning to mark Parkinson's Awareness Week; and what plans they have over the next year to help those suffering from Parkinson's disease and their families, friends and carers who support them.
The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, we welcome Parkinson's Awareness Week. The Government strongly support the Parkinson's Disease Society for the work it is doing in helping patients, particularly in the development of Parkinson's disease nursing posts.
We are developing a national service framework for long-term conditions that will focus on improving services for people with neurological conditions, including Parkinson's disease. The Government are investing an additional £40 million in stem cell research in 2004–06, which offers enormous potential, introducing new treatments for diseases such as Parkinson's.
Lord Harrison: My Lords, I thank my noble friend for that Answer. Will the Government fund the 50 additional specialist nurses in Parkinson's disease to ensure that the 25,000 sufferers currently deprived of such services are so provided? Secondly, will the Government assess and provide the services required for carers, one in four of whom are over the age of 75 and often experience difficult health problems?
Lord Warner: My Lords, there are currently 183 specialist Parkinson's disease nurses in the UK and I pay tribute to the work that the Parkinson's Disease Society has done in helping to produce that number. We take seriously the need to expand the number, but I cannot give a categoric assurance to my noble friend today.
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The Government have provided a strong increase in the carer's grant. We are now providing more than 2 million breaks a year for more than 143,000 carers as a result of that grant. My honourable friend Stephen Ladyman will be producing a new carers' performance indicator, which will show how local services are doing.
Baroness Masham of Ilton: My Lords, is the Minister aware that there is not one specialist consultant or nurse in the whole of North Yorkshire for people suffering from Parkinson's disease? Is he also aware that the monitoring and provision of specialised drugs is very important for the condition?
Lord Warner: My Lords, on the latter point. I agree that the monitoring of specialised drugs for this condition is critical. Due to the individual circumstances of each sufferer, it is important that we get the drug regimes right.
I will look into the issue of North Yorkshire and write to the noble Baroness. However, I would reassure her that the number of consultants in neurology who look after patients with this condition has increased by almost 50 per cent since this Government came to office.
Lord Addington: My Lords, although I am pleased to hear about the increase in the number of neurologists, do the Government accept that by international terms it is low? When can we expect to achieve an increase in the number of neurologists who will be able to make an early diagnosis, thus giving the correct drug therapy a chance to slow down the rate of the disease? Has a study been carried out on the cost-effectiveness of that action, which would result in a reduction in the amount of care required and possibly keep people in work longer?
Lord Warner: My Lords, there are now more than 400 consultant neurologists, as compared with 47 per cent fewer in 1997. Although we could do with more, we are on a strong upward trend.
As I said in my Answer, we are producing a national service framework, which will produce a stronger set of proposals around the best way of developing services for people with this condition.
Lord Ashley of Stoke: My Lords, do the Government support the Bill which has just been debated in the House of Commons and will soon be coming here?
Lord Warner: My Lords, I have to take custody of that question and write to my noble friend.
Lord Walton of Detchant: My Lords, I welcome the new developments in the care of patients with Parkinson's disease and the increase in the consultant establishment. However, does the Minister agree that the massive developments in treatment which have been introduced into the care of people with this disease during the past few years might have been made much more difficult had it not been possible to examine in detail brain samples many years ago in

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order to discover the missing chemicals responsible for the symptoms of the condition? That examination might have been made much more difficult if the Human Tissue Bill in its present form had been implemented by Parliament?
Does the Minister also agree that, happily, many new forms of treatment are being introduced as a result of massive research in molecular genetics and in the chemical changes that occur in the brain of someone with Parkinson's disease?
Lord Warner: My Lords, the noble Lord is right to emphasise the importance of research in this area, and that is why I mentioned it in my Answer. The Government are investing an extra £40 million in stem cell research over a two-year period. I believe that ours is the first country in the world to set up a national stem cell bank, which will help researchers in this area.
Lord Elton: My Lords, can the Minister tell us what proportion of the stem cell research will be carried out on adult stem cell material and how much on foetal material?
Lord Warner: My Lords, the allocation of that money is in the hands of organisations such as the Medical Research Council. I shall look into the detail and write to the noble Lord.
Baroness Finlay of Llandaff: My Lords, is the Minister able to inform the House whether discussions have taken place with the Council of Heads of Medical Schools about the education of medical undergraduates across the UK in neurology, given the importance of accurate diagnosis and the need to differentiate Parkinson's disease from the Parkinsonian symptoms that occur as drug side-effects associated with other diseases?
Lord Warner: My Lords, the noble Baroness has asked me a rather technical question. I shall look into it with my usual assiduousness and reply to her.
Baroness Warnock: My Lords, does the Minister feel able to answer the second part of the question asked by my noble friend Lord Walton of Detchant regarding the possible dangers to future research contained in the present Human Tissue Bill?
Lord Warner: My Lords, that was an oversight on my part. I, together with my honourable friend Rosie Winterton, met a large number of interests representing medical research to discuss the Human Tissue Bill. We are considering very carefully their representations and the points that they made, and I am cautiously optimistic about our ability to respond to those concerns.
Earl Howe: My Lords, can the Minister say what progress has been made in informing and advising NHS trusts of the desirability of enabling Parkinson's sufferers to self-medicate while they are in hospital?
Lord Warner: My Lords, a whole area of patient choice relates to our ability to give people more control
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over their medication, consistent with their condition. We do not have a specific answer to that question, but I shall find out whether more advice has been given on the issue and write to the noble Earl.

Bus Priority Measures
2.45 p.m.
Lord Bradshaw Lord Bradshaw asked Her Majesty's Government:
What proposals they have to help the bus industry, in relation to both traffic flow and cost increases.
Lord Davies of Oldham: My Lords, the Traffic Management Bill will improve traffic management and reduce congestion. This, and the implementation of bus priority measures, will make buses more reliable and cut journey times, reducing operating costs. The 2003 local transport settlement involved a £1.9 billion funding package, much of which will be spent on bus-related and traffic management schemes. Bus service operators grant rose from £222 million in 1998–99 to £341 million in 2003–04, helping to meet cost pressures on the industry.
Lord Bradshaw: My Lords, I thank the noble Lord for that helpful reply. As well as the various measures to ease congestion that he described, does he have any definite news for the House on whether other cities are likely to follow the example of London and introduce congestion charging or, indeed, whether they are likely to follow my own authority in Oxford in introducing traffic regulation orders to free up the city centre so that traffic with the highest priority may use it?
Lord Davies of Oldham: My Lords, a number of authorities are looking at successful examples of innovation. They include Oxford, which plays a part with regard to its buses, and Cambridge, although these issues are not restricted to the university towns. The noble Lord is right that it behoves local authorities and transport executives to look closely at current developments which are increasing bus usage in certain cities to a marked extent. Of course, we would like to see that extended.
Lord Berkeley: My Lords, bearing in mind that road congestion seriously delays buses, can my noble friend say what the Government can do to encourage local authorities to free up some roads and introduce more radical solutions in relation to buses? What can they do with regard to local authorities such as Barnett, which seem to be removing bus lanes to give more space for cars? Does that not go against the Government's transport policy?
Lord Davies of Oldham: My Lords, local authorities are responsible to their own electorates for the decisions that they take. However, I think that my noble friend will recognise that a number of local authorities—we have already cited one or two—have adopted imaginative schemes to tackle congestion and

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to improve, in particular, bus passage. We all recognise that buses are an extremely economic form of transport in our cities and towns. That is why we want to see an increase in the level of bus usage.
Baroness Scott of Needham Market: My Lords, can the Minister tell the House what progress is being made on bus lane enforcement with cameras outside London? Over the past three years, my noble friend Lord Bradshaw has received Written Answers suggesting that this will happen "shortly", "soon" and "imminently". Does the Minister have another adverb today?
Lord Davies of Oldham: My Lords, part of the reason for those reservations in the replies at this stage is that the Traffic Management Bill is still before this House. The noble Baroness will recognise that the purpose of the Traffic Management Bill is to improve usage of the highway and to encourage local authorities to adopt exactly the strategies which she advocated; namely, enforcement of road space for priority users. Buses must use bus lanes properly and other road users must stay out of them.
Lord Pearson of Rannoch: My Lords, can the Minister tell the House whether the introduction of the new, long, low, single-storey, continental-style bus has improved or unimproved traffic flow? While he is at it, could he give us any assurances as to the future of our beloved double-decker?
Lord Davies of Oldham: My Lords, our double-decker is safe and beloved and will stay even safer if the bendy buses' propensity to burst into flames continues at the recent level. The noble Lord will recognise that many of us cannot see some devious plot in that by Europe; nor do we think that there should be a referendum on the issue.
Lord Faulkner of Worcester: My Lords, while putting to one side the comment famously attributed to the noble Baroness, Lady Thatcher, that anyone over 30 who travels by bus is a failure, does my noble friend agree that it is worth looking at the suggestion contained in the Select Committee report in the other place that there need to be many more bus quality contracts? Also, is there not a case for at least some experiments in local authority regulation of bus services, as it seems to work in London?
Lord Davies of Oldham: My Lords, we want to see an increase in bus quality contracts because there is no doubt that local authorities and the bus companies can reach intelligent decisions on the deployment of buses. In fact, my right honourable friend the Minister, Tony McNulty, who chairs a committee which includes local authority representatives and bus operators, is expressly concerned to develop these concepts in the way that my noble friend advocates.
Viscount Astor: My Lords, is the Minister therefore considering whether to amend the Transport Act 1985,
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which deregulated buses, and introduce a franchise system as exists in London? Furthermore, is the noble Lord aware that, unlike his Government, a bendy bus cannot do a U-turn?
Lord Davies of Oldham: My Lords, we do not propose to amend the 1985 Act in quite the way that the noble Viscount suggests. But, of course, even he will recognise that the passage of two decades would lead modern forward-looking governments to look to new measures beyond what that measure provided. I have indicated to the House today that we have a Bill before your Lordships' House—the Traffic Management Bill— which will certainly improve road usage and the priority allocated to buses.
Lord Hunt of Kings Heath: My Lords, does my noble friend agree that, while traffic management measures may well encourage greater use of buses, one of the big problems with bus use is that many people feel insecure, particularly late at night and with the operation of one-man, or one-woman, driver-only buses? Does he think that a more general return of conductors might help in the use of buses and the security of people using them?
Lord Davies of Oldham: My Lords, my noble friend has highlighted an important point. Passengers on buses need to feel secure, particularly late at night. But of course there is a real problem about the introduction of conductors to buses. An important aspect of bus costs at the present time is drivers wages. The addition of conductors would render a number of services somewhat uneconomic. The answer probably lies, therefore, in the development of closed-circuit television, which is being applied to vast numbers of buses—that is so particularly in London—and in prompt communications between the bus driver having trouble and the local police.

Asylum Seekers: Applications
2.54 p.m.
Lord Renton Lord Renton asked Her Majesty's Government:
How many people claiming to be asylum seekers have arrived in the United Kingdom since 31 March 2003; how many of these have been granted asylum; how many have had asylum refused; and how many cases remain to be decided.
The Minister of State, Home Office (Baroness Scotland of Asthal): My Lords, from 1 April to 31 December 2003—the latest period for which figures are available—there were 33,370 applications for asylum in the United Kingdom. We do not have data on the outcome of applications made in that period, but 43,480 asylum decisions were made during that time. Of these. 2,360 decisions—that is, 5 per cent—granted asylum. Around four-fifths of new applications now receive an initial decision within two months.
Lord Renton: My Lords, I thank the noble Baroness for that no doubt accurate and surprisingly full reply.

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Is it not vital that the invasion of asylum seekers should be thoroughly controlled, as some may be terrorists and a good many are simply illegal immigrants whom we do not need and do not want to have?
Baroness Scotland of Asthal: My Lords, we do not see this as an invasion of asylum-seeking terrorists and we do have very good control of the numbers. Your Lordships will know that we have halved the number of applications for asylum. In October 2002, 8,770 people applied for asylum; in December 2003, the figure was 3,535. In total, there were 49,370 applications for asylum in 2003. That is 41 per cent fewer than in 2002. With all the measures that we have put in place, we have this issue very firmly under control.
Baroness Walmsley: My Lords, can the Minister give the backlog figure for appeals over the same period? Does she share my concern that the Home Office appears to be increasingly using the tactic of refusing people in the first instance and then leaving the substantive decision to the appeal stage? For some countries the number of successful appeals is in the 40 per cent region, which indicates that the quality of decision-making in the first instance is not good and that the backlog has simply been shifted to the appeal tribunal.
Baroness Scotland of Asthal: My Lords, I do not agree with that analysis. A record number of appeals— 81,725—were determined by adjudicators in 2003. That is more than one-quarter—27 per cent—higher than in 2002, when the figure was 64,405. The proportion of appeals dismissed rose to 78 per cent in 2003 from 76 per cent in 2002, while the proportion of appeals allowed fell to a figure of 20 per cent from 22 per cent in 2002. So, we are removing record numbers of failed asylum seekers, together with dealing with the appeals very expeditiously. I do think that adjudicators and the courts dealing with the matter need to be congratulated on the real improvements that they have made in this regard.
The Lord Bishop of Worcester: My Lords, is any record kept or research done as to the fate of those people whose applications are refused and who find themselves, whether voluntarily or by compulsion, back in the countries from which they came? Does the Minister agree that being clear about the quality of decision-making means, among other things, being clear about what happens when we say no?
Baroness Scotland of Asthal: My Lords, I agree with the right reverend Prelate. It is necessary to make sure that the quality decisions we make are correct and robust. I reiterate: the Government are totally committed to maintaining provision of proper help and support to those who are entitled to asylum.
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I do not have the relevant information in relation to what happens once the applicant goes back to his country of origin or another place. I shall write to the right reverend Prelate in relation to that matter.
Lord Campbell of Croy: My Lords, further to that point, when asylum has been refused, what normally happens to applicants who are already in the United Kingdom? Is physical force resorted to, or do most of them simply disappear in this country?
Baroness Scotland of Asthal: My Lords, the applicants do not disappear. Your Lordships will know that we have sought to put in place a humane and appropriate system whereby notification is given to applicants so that they can voluntarily make arrangements with the appropriate authorities for their return. If they participate in those arrangements, removals take place in a way that we hope meets the needs of applicants and the authorities. We find that those arrangements work far better than they have in the past. The number of people removed in proper situations and circumstances has increased significantly, as I have already indicated.
The Earl of Listowel: My Lords, while recognising the need for a firm response to and management of asylum, does the noble Baroness recognise the concern of the 19 year-old woman to whom I spoke last night and her 63 year-old father about returning to Kosovo when 28 people were recently killed in ethnic conflict; when they know that they cannot return to their home or to their village because it is now Serbian occupied; and when there is a shortage of mental health services, of which she is presently making use? Does the Minister recognise the need to approach the matter sensitively, especially when families with young children are involved, and to be careful in how we proceed?
Baroness Scotland of Asthal: My Lords, of course we realise that there are worries about these issues and that sensitivity is necessary. I can tell noble Lords that factors relating to returns are carefully considered and the most humane and appropriate measures put in place to ensure that returns can be facilitated in a proper manner.
Baroness Anelay of St Johns: My Lords, can the noble Baroness clear up the confusion over government policy on returns of asylum seekers to Iraq that arose during the weekend? The Home Office seemed to give two different answers to the BBC and the Observer about its original intent to begin returns to Iraq by the end of April this year. Can she enlighten the House about what is now the policy?
Baroness Scotland of Asthal: My Lords, I say openly to the noble Baroness that I did not know that there was any difficulty regarding the message about Iraq. I shall certainly write to her to clarify that point.

Identity Cards
3.1 p.m.
Lord Janner of Braunstone Lord Janner of Braunstone asked Her Majesty's Government:
Whether they will introduce compulsory identity cards as a matter of urgency.
Baroness Scotland of Asthal: My Lords, my right honourable friend the Prime Minister has made it clear that the Government are committed to the introduction of an identity card scheme as soon as is practically possible. The Cabinet agreed in November last year that legislation would be brought forward to build a base for a compulsory scheme. The Government will publish a draft Bill and consultation paper.
Lord Vinson: My Lords—
Lord Janner of Braunstone: My Lords, perhaps there should be a compulsory card to wait.
I thank my noble friend for that Answer, which is very helpful. But how long will we have to wait? Does she not accept that it is vital that we move as fast as possible—at the very least to introduce identity cards to help our security services in their vital efforts to root out and deal with dangerous terrorist elements in the United Kingdom? Why are we waiting when already 10 European countries provide such cards? Belgium, Germany, Greece and Spain make them compulsory. We already have compulsory cards for driving and for travelling abroad. What is the delay? Why is it happening and when will we see results?
Baroness Scotland of Asthal: My Lords, I reassure my noble friend that there is no undue delay. As I said in my Answer, the Government have made their commitment clear about identity cards. We hope shortly to be able to publish a draft Bill, where the matter will be clearly set out. The timing of my noble friend's Question is helpful but, he may find, unfortunate in terms of the answer that I can give him today.
Lord Vinson: My Lords, forgive my earlier impulsiveness. Does the Minister agree that this is a bit of a Morton's fork? If it is made compulsory to carry the new identity card at all times, millions of absentminded and forgetful citizens will be criminalised. If, on the other hand, it is not compulsory to carry the identity card, it is difficult to see what benefits it will bring.
Baroness Scotland of Asthal: My Lords, perhaps I may disabuse the noble Lord on the first issue. It will not be compulsory to carry the card. Noble Lords will know that it is proposed that there should be a two-stage system, one stage of which would involve the creation of a register. Although we believe that people will want to carry their identity card with them for the purposes of ordinary, everyday conduct of business—in the same way that we currently use driving licences as proof of
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identity—we do not think that the system will be undermined if people are not made compulsorily to carry the card. We think that the system that we propose will work well.
Lord Monson: My Lords, is the noble Baroness aware that 60 or so years ago, British prisoners of war with only the most rudimentary tools at their disposal managed to forge identity documents that successfully fooled the Gestapo?
Baroness Scotland of Asthal: My Lords, I am so aware, and I see in his place the noble Lord who could perhaps give us some graphic examples of that. However, we are seeking to change the nature of those identity cards, because biometric data, by their very nature, are difficult if not impossible to replicate.
Baroness Walmsley: My Lords, is the Minister aware that an Answer in another place from Beverley Hughes MP to my honourable friend Mark Oaten MP states that 23 civil servants, three full-time secondees and six external part-time consultants are currently engaged in the identity card programme? What is the cost of that large workforce working on a project which, I believe, does not have majority Cabinet support and certainly does not have overall political support?
Baroness Scotland of Asthal: My Lords, perhaps I may disabuse the noble Baroness on her last point, because it has total Cabinet support. I have said unequivocally that the Government are committed to the introduction of a compulsory scheme. I am sure the noble Baroness will well remember that that was made plain last November.
I cannot give the noble Baroness the precise figures for the cost. The Government are learning from past experience of large IT projects. The Office of Government Commerce completed its gateway review in January 2004 and assessed the programme as ready. Your Lordships will know that for a number of reasons it is difficult for me to give the figures today.
Baroness Sharples: My Lords, is the noble Baroness aware that it is more than 10 years since I started asking a similar question? Do the police now accept that a compulsory card is necessary, when 10 years ago and since they did not like the idea of a compulsory card, only a voluntary one?
Baroness Scotland of Asthal: My Lords, I have no indication that the police are anything other than supportive of this venture. Noble Lords in this arena have heard much that has been said by ACPO about terrorism and the need to identify those who seek to take advantage of our current system. It may well be that time and experience have changed a number of people's minds on the issue.
Baroness Knight of Collingtree: My Lords, is it the case, as has been reported, that every holder of the card will have to pay £70? If they refuse to pay £70, will they

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go to prison? Is some arrangement to be made for those who cannot easily afford £70? If so what will it cost?
Baroness Scotland of Asthal: My Lords, I straightaway reassure the noble Baroness that the figure to be charged for the card has not yet been determined. Noble Lords will know from our debate on the matter late last year that the whole scheme will take place in two tranches. The first tranche will be the introduction of biometric data both for passports and driving licences. In accordance with the normal way, there will be an assessment of how much that will cost. There will then be a second stage when we roll out the compulsory scheme, when Parliament will have an opportunity to debate the issues in great detail. Some have described the procedure that has been specifically adopted for that as a super-affirmative procedure. At that stage, we will know more precisely how much the cards are likely to cost. We also made clear that provision will be made for those who are disadvantaged financially.

Iraq: Coalition Provisional Authority
3.9 p.m
Lord Wallace of Saltaire Lord Wallace of Saltaire asked Her Majesty's Government:
Whether British influence over the Coalition Provisional Authority is commensurate with the United Kingdom's contribution to the security and reconstruction of Iraq.
The Minister of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): Yes, my Lords. Since the adoption of UNSCR 1483 on 22 May 2003, the working relationship has functioned well at a variety of levels: politically, militarily and technically. Of course, on occasion there are differences of emphasis and opinion but, in terms of security, the British military dominates in the Multinational Division (South-East) and, in terms of reconstruction, British companies are involved in contract awards worth more than 1.65 billion US dollars.
Lord Wallace of Saltaire: My Lords, I thank the Minister for that reply. Does she accept that noble Lords on these Benches are extremely concerned that the British Government should have proper influence over all levels of decisions taken by the Coalition Provisional Authority? We note, for example, as is now published in Washington, that, while at the talks President Bush was willing to accept the Prime Minister's request that the UN should have a "vital role" in the reconstruction of Iraq, the National Security Adviser, Condoleezza Rice, told him very firmly, we are informed, when he got back that he should no longer use that phrase.
In 10 weeks' time the situation will change. We are also told in Washington that the Coalition Provisional Authority will become the US Embassy. Can we be
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reassured that the British Government will continue to have an active influence in the role of multinational forces after the transfer of sovereignty to Iraq?
Baroness Symons of Vernham Dean: My Lords, it is important to remember that the provisional authority is a coalition. A coalition by its very nature has a variety of opinions, which are resolved through discussion and compromise. That is the case with the CPA. I remind the noble Lord that, so far as concerns internal relationships in the United States, the President of the United States is the President of the United States, not Miss Condoleezza Rice. What the President says is what we must rely on.
After 1 July there will be two embassies: an American Embassy and a British Embassy. There will be a difference after 1 July. At the moment, the offices currently occupied by David Richmond and those occupied by Ambassador Bremer are linked by a private office and there is daily contact. After 1 July, there will be separate embassies—ours will be the biggest that we have in the Middle East—but mechanisms are being set up and there will be a great deal of interchange between the two offices in order to have oversight over what is going on after 1 July.
Lord Avebury: My Lords, if the relationship is as good as the Minister claims, why did Sir Jeremy Greenstock refuse the Prime Minister's urgent request to remain at least until the end of the CPA on 30 June? Could we exert whatever influence we possess to ensure that coalition forces adhere to the Geneva Conventions, particularly Article 57 of Protocol 1, which says that forces should refrain from any attack which,
"may be expected to cause incidental loss of civilian life".
disproportionate to the military advantage anticipated? Will the Government propose to our US allies that the international fact-finding mission established under Article 90 of Protocol 1 be invited to inquire into the alleged grave breaches of the Geneva Conventions being committed by coalition forces?
Baroness Symons of Vernham Dean: My Lords, the whole question on the noble Lord's last point is what one deems disproportionate. In the past few weeks there have been attacks from terrorist elements resulting in great losses of civilian life. The important point in what the noble Lord quoted is the question of proportionality; it is always the important point. Of course our forces abide by the issues of proportionality under the Geneva Convention.
The noble Lord asked whether the relationship was as good as claimed, when Sir Jeremy Greenstock was going before the handover period. Sir Jeremy Greenstock has been admirably generous in the time that he has given to the work that he has undertaken in Iraq. He was prevailed upon to come back from retirement to undertake that work, and I for one do not begrudge him a single moment of the time that he has now decided he wants to spend doing other things. I am delighted to say that in his successor, David Richmond, we have an enormously able diplomat. It is regrettable that others have cast some doubt on his seniority—the noble Lord did not do so. As the Minister

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directly responsible for that part of the world, I take the opportunity from this Dispatch Box of saying how delighted I am that we have somebody of Mr Richmond's ability undertaking the work at the moment.
Baroness Rawlings: My Lords, how do Her Majesty's Government plan to combat the decline in NGO and business involvement in Iraq, as staff are increasingly pulling out due to the increase in security problems and kidnapping?
Baroness Symons of Vernham Dean: My Lords, the increase in security and kidnapping problems over the past weeks are now being addressed. Having looked at the overnight dispatches and those over the past couple of days or so, I am happy to be able to tell the noble Baroness that there is a quieter period at the moment. Nobody can guarantee how long that will be sustained, but current reporting indicates that there is a quieter period.
The noble Baroness referred to a decline in NGOs and business. That is not the case. When I was in Iraq very recently, I spoke to a number of officials from NGOs, which are enjoying a good relationship with British and American aid agencies. In my initial response to the noble Lord, Lord Wallace of Saltaire, I made the point that we were gaining quite a number of contracts, whose current value is more than 1.65 billion US dollars. We have a number of others in the pipeline. I hope that the noble Baroness will also be pleased to know that we expect contracts and aid provision to increase in volume over the next couple of months or so.
Lord King of Bridgwater: My Lords, while the Minister is giving her customarily vigorous defence of the Government's position and the situation in Iraq, everyone in this House knows that the situation at the moment is extremely worrying. It is extremely difficult to get an accurate picture of the situation. I repeat the plea publicly that I have made to the Leader of the House privately: there must be a better system for the Government to keep people informed on the actual situation in Iraq. It is no good for the Prime Minister to stand up and say that everybody knows that things are going better generally in Iraq, and that the news reporting of the overall position is not accurate, if we have no way of establishing that overall position.
Baroness Symons of Vernham Dean: My Lords, the noble Lord refers to my "customarily vigorous" report; I hope that it is also customary in its accuracy. It is difficult on occasions for a government to keep people informed when it is very hard for some parts of the media to want to pick up some of the better news coming out of Iraq. I have just come back from the United States of America. I was very struck to read on the front page of a United States journal a report about the way in which medical facilities were going to the Iraqi people and allowing those who had been injured to recover from facial or leg injuries, and a range of other points.
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I have never seen a report like that without comment in the British press. In my view—it is a personal view— it is regrettable that we get no such reports in the British press without a great deal of overlay of editorial comment. It was startling to see in the US press reporting without comment about some of the good things happening in Iraq. I hope that parts of our media and press will listen to what the noble Lord has said and perhaps recognise that they, too, have responsibilities in this matter.

Traffic Management Bill
3.17 p.m.
Lord Davies of Oldham: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That it be an instruction to the Grand Committee to which the Traffic Management Bill has been committed that they consider the Bill in the following order:

Clauses 1 to 39,

Schedule 1,

Clause 40,

Schedules 2 and 3,

Clauses 41 to 50,

Schedule 4,

Clauses 51 to 61,

Schedules 5 and 6,

Clauses 62 to 70,

Schedule 7,

Clause 71,

Schedule 8,

Clauses 72 to 74,

Schedule 9,

Clauses 75 to 81,

Schedule 10,

Clauses 82 to 87,

Schedule 11,

Clauses 88 to 94,

Schedule 12,

Clauses 95 and 96.—(Lord Davies of Oldham.)

On Question, Motion agreed to.

European Union
3.18 p.m.
The Lord President of the Council (Baroness Amos): My Lords, I would like to repeat a Statement made in another place by my right honourable friend the Prime Minister. The Statement is as follows:
"With your permission, Mr Speaker, I will make a Statement on the forthcoming negotiation over the new European treaty. In parallel, the Foreign Secretary is publishing today a White Paper on Europe.

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"On 1 May the EU will enlarge from 15 to 25 members. It will be the biggest ever increase in Europe's size. It will reunify Europe after the travails of communist dictatorship in eastern and central Europe. It is an historic event, one this British Government and the one before us have championed. Whatever the problems it poses, and we see that in the anxiety over prospective immigration, let us be in no doubt: the prospect of EU membership, together with the courage of the governments concerned, is the primary reason why those countries have been able to reform their economies and politics so radically and so beneficially. Such change has been in the interests of all of Europe. I say unhesitatingly that enlargement is right for Europe and for Britain and we should support it.
"In addition, Bulgaria and Romania are set for membership in future years, taking the numbers to 27. Turkey is now making extraordinary strides forward in democracy, in human rights, in economic change, in the resolution of the conflict in Cyprus, strides that would have been unimaginable just a few years ago, and all under the impulsion of future EU membership. So, within the space of a few years, Europe will be transformed. It will be easily the strongest political union and greatest economic market in the world. Britain should be at the heart of it. That is its right and its destiny.
"Because of enlargement, Europe is sensibly seeking to change the way it works. In a Europe of 25 or 27 or 28, a rotating six-month presidency makes no sense; the use of the veto should be confined to the areas where it is truly necessary, otherwise decision-making becomes paralysed, and in certain areas, terrorism, security, economic reform, the environment, Europe must do more and do it better.
"The new constitutional treaty is designed both to answer the challenge of enlargement and to bring together in one treaty what is presently found in two separate treaties. Indeed, a significant part of the new treaty is a repetition of articles already in force. I want to make clear in this negotiation that Britain will co-operate fully in helping Europe to work better; but work better as a Europe of sovereign nation states.
"There are certain areas of policy where maintenance of control of our affairs is essential. In those areas, such as taxation, foreign policy, defence, social security, how the essentials of our common law criminal justice system work, treaty change, we believe that the national veto must remain. We will insist on the necessary amendments to the present draft treaty to ensure beyond doubt that they do. On this basis, the treaty does not and will not alter the fundamental nature of the relationship between member states and the EU.
"The new treaty then would take effect, after ratification by all member states, probably in 2007, with certain key provisions in 2009. Until then, the key provisions of the Nice Treaty will remain in place. If the new treaty contains these essentials, we believe it is
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in Britain's interests to sign it. It will replace the six-month rotating presidency with a full-time chairman of the Council—a vital step away from federalism, enabling the Council, which is of course the repository of the individual governments, to become the body that sets Europe's agenda.
"The new treaty for the first time will allow national parliaments the right to object to Commission proposals for legislation—a big advance in subsidiarity. It adds a greater ability to co-operate in areas such as terrorism and cross-border crime, which are crucial for the world in which we live. It gives a bigger role for enhanced co-operation between some of the member states, where not all of them wish to participate in certain areas.
"That is what the treaty, if amended in the way that we seek, will actually do. Ever since its inception, however, the myths propagated about it have multiplied in those quarters, political and media, who we know are hostile not just to this treaty but to the whole notion of Britain playing a central role in Europe: that the EU will be renamed the United States of Europe. No, it will not. It is to remain the EU. That The Queen will be replaced as our head of state by an EU President of the Council. In fact, we already have a President of the Council and always have had. That Britain will be forced to join the euro, without a referendum and regardless of our economic tests being passed. No, it will not. The existing agreements on the single currency remain in the new treaty.
"That Britain could not mount a future Falklands war or Iraq campaign without permission from Brussels. Yes, we could. Defence is to remain unanimous and the prerogative of the nation state. That we will lose our seat on the UN Security Council. No such provision exists. That Brussels will seize control of our oil supplies. No, it will not, and the treaty will make that clear. That Brussels will have the power to set taxes in Britain. Taxation is to remain with the nation state.
"That our foreign policy will now be decided by the EU, because the new treaty obliges member states to support Europe's common foreign and security policy in a spirit of loyalty and mutual solidarity. Actually, those words are taken from the Maastricht Treaty, and in any event CFSP is decided unanimously. That we will surrender control over our borders. It is already agreed that our right to control our borders will be specifically retained in the new treaty. That the assumption of innocent until proven guilty in British law will be scrapped. No such provision exists. All these, and many others, such as the hardy perennials about being forced to drive on the right, the Germans taking over our nuclear weapons, and no doubt the shape of our bananas too.
"Even yesterday, we had the Leader of the Opposition asserting that if this treaty were in place, I would be unable, as British Prime Minister, to go to Washington to talk to President Bush. All of it is nonsense, myth, designed to distance people's understanding of what

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Europe is about and loosen this country's belief in its place in Europe. It has been an unrelenting, but I have to accept, partially at least, successful campaign to persuade Britain that Europe is a conspiracy aimed at us rather than a partnership designed for us and others to pursue our national interest properly in a modern, interdependent world. It is right to confront this campaign head on.
"Provided the treaty embodies the essential British positions, we shall agree to it. Once agreed, either at the June Council, which is our preference, or subsequently, Parliament should debate it in detail and decide upon it. Then, let the people have the final say. The electorate should be asked for their opinion when all our questions have been answered, when all the details are known, when the legislation has been finally tempered and scrutinised in both Houses, and when Parliament has debated and decided. That was Michael Howard in 1997.
"The question will be on the treaty, but the implications go far wider. It is time to resolve once and For all whether this country, Britain, wants to be at the centre and heart of European decision-making or not. It is time to decide whether our destiny lies as a leading partner and ally of Europe, or on its margins. Let the Euro-sceptics, whose true agenda we will expose, make their case. Let those of us who believe in Britain in Europe, not because we believe in Europe alone, hut because, above all, we believe in Britain, make ours. Let the issue be put. Let the battle be joined."
My Lords, that concludes the Statement.
3.28 p.m.
Lord Strathclyde: My Lords, I thank the noble Baroness the Leader of the House for repeating the Statement. I offer her congratulations—this afternoon, she is repeating not just one Statement, but two. The Statement that she has just repeated is an historic announcement. First, it gives the British people what we on this side have long said is their due—the right to decide in a free vote on any new EU constitution. We welcome that. The Prime Minister was utterly wrong to resist a referendum. The noble Baroness, Lady Williams of Crosby, and I differ on many aspects of policy on further EU integration, but we were united on this point, as were many noble Lords behind the noble Baroness.
For us, the case that the British people should be allowed to decide was a point of principle. But this afternoon's announcement is not an announcement of principle. The hand of history holds a thousand quotes that reflect the Prime Minister's real view that a referendum need not, and should not, he held. No spin, however artful, can ever wipe them from the record. All of us in this House know the truth. If the Government could have avoided a referendum they would have. They changed their mind only because they fear a total wipe-out in the European elections in June. So, let us not dress up this decision in the clothes of idealism.
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Expediency, not principle, dictated the Statement today. After all, what did the noble Baroness, Lady Symons of Vernham Dean, tell this House last September when valiantly stonewalling Peer after Peer on a referendum? She said that,
"a referendum might be right if we needed to consult on creating or joining a new institution, not on reform of an existing institution of which we are already a member". —[Official Report, 9/9/03; col. 276.]
Why was that right then, but wrong now? What has changed? When did it change? When was the noble Baroness consulted on it?
The second historic feature of the announcement is that the Government have now accepted that the earth is not flat and that the EU constitution is not a mere tidying-up exercise. The Leader of the House put up a good fist today when repeating the Statement, but she also knows the score. On 29 March, just seven short sitting days ago, when challenged by me to trust the people in a referendum, she said that, in practice, referendums,
"have been held where there is a wholly new constitutional structure proposed. That is not the case in this instance, and we have made that absolutely clear time and again".
The noble Baroness told the House that there was no constitutional significance and that there would he no need for a referendum and no vote for the British people. I repeat her words:
"we have made that absolutely clear time and again".—[Official Report, 29/3/04; col. 1053.]
How difficult it must be to be a Cabinet Minister loyally following the line when one can be telephoned a few days later—perhaps even from Bermuda—and told to do the political equivalent of engaging reverse gear at 100 miles an hour.
I am sure that many in this House will share my sense of sympathy with the Leader of the House and the noble Baroness, Lady Symons of Vernon Dean, who are left high and dry by a U-turn after doggedly defending the indefensible for so long.
Of course, the Statement did not mention a referendum by name. But will the noble Baroness answer some questions about a referendum? I am sure that the Government have thought about them. Did the noble Baroness see the frankly very surprising remarks of Mr Sam Younger who said that a referendum could not be conducted until the Electoral Commission had seen the results of regional referendums this autumn? What possible relevance do they have to a national referendum? They will be conducted by all-postal ballots, despite the clear distaste of this House for that system. Can the noble Baroness give the House a clear assurance that the traditional ballot box will be used in an EU referendum? Who will frame the question? Will there be talks between parties before any draft is put to the Electoral Commission? Can the noble Baroness confirm that any referendum legislation will provide for equality of expenditure between all those on both sides? Those are important points of principle, which the House will expect to be answered today.
Finally, I turn to the timing of the referendum. Having resisted a referendum for as long as they could, it now seems that the Government want to delay a vote for as long as possible. I disagree with the Prime Minister about

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the EU constitution, but I would respect him more if he took his case to the country now. His Statement ended with that fine rhetorical flourish implying that he would do just that. But, of course, that is what it amounted to— so much rhetoric. Just as the bogus attacks on the Conservative Party for wanting to come out of the European Union are just that—so much rhetoric—as my noble friend Mr Howard again made abundantly clear in another place today.
By delaying a vote, the Government risk giving the impression that they are waiting for a Denmark or a Holland to turn up with a "No" vote and spoil the EU constitutional broth. If I were one of the increasingly grey and grizzled legions of the "Yes" campaign still waiting after seven long years for the imperial nod to be signalled for the campaign to start, I should be deeply disappointed in that. To declare that one wants one thing in public and to one's European allies and to seem to be prevaricating and praying for the opposite in private risks looking weak and pleasing no one. That is why I agree with the Prime Minister in his Statement when he said:
"Let the issue be put. Let the battle be joined".
It is not UK legislation that is the subject of this referendum, but an EU treaty that may be done and dusted in June.
I did not notice any worry about the need to have passed legislation holding up enthusiasm for referendums on Scottish or Welsh devolution. But if this is the new government doctrine, can the noble Baroness tell the House whether the Government will now be cancelling regional referendums this autumn until legislation on the assemblies is passed?
We on this side of the House are ready to agree to facilitate the speedy passage of legislation to enable a referendum to take place this autumn. With the Constitutional Reform Bill able to be carried over and the House of Lords Bill dropped, there is clearly time for new legislation to be taken. Will the noble Baroness therefore agree to call urgent talks with the usual channels to seek agreement on a programme for a referendum Bill this summer? Surely, that is a constructive offer that meets what the public want and offers a sensible way forward.
3.36 p.m.
Baroness Williams of Crosby: My Lords, I, too, thank the Leader of the House for repeating a Statement made by the Prime Minister. Perhaps I may allow myself one moment of nit-picking following the rather excellent nit-picking by the Leader of the Opposition, the noble Lord, Lord Strathclyde. On these Benches, we have one mild objection to the way in which this matter has been handled. It is unfortunate that the Sun and the Times learnt long before Parliament about the change in the Prime Minister's intention with regard to a referendum. I think that we all recognise the brilliance of his back somersault, which would be something of an honour to any circus that could possibly win his attention these days.
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My first question is about the final negotiation of the constitution itself. During the next few weeks there will be a crucial final negotiation of the constitution. Can the Leader of the House tell us whether the Government will press the argument for a greater degree of subsidiarity than exists at present? In particular, therefore, will they press for a devolution of decision making to the nation states and below where there are issues that are still in balance between the European Union, the nation states and those other regional and subsidiary agencies? Can the noble Baroness confirm that the larger part of the new constitution devoted to making the enlarged Europe work is a change that would be absolutely essential if a Europe of 25 countries—which is now what we have—is to be effective? Is that one of the major purposes of the new constitution, without which it would be quite difficult to make it work by keeping Nice going for yet longer?
I congratulate the Government on finally taking a high position in the proposed campaign. I agree with the noble Lord, Lord Strathclyde, that some of us, including myself, have grown old and grizzled waiting for this to happen. It now having happened, we on these Benches hugely welcome it and congratulate the Government on finally having reached this position.
Many on these Benches feel very strongly that the remarkable political achievement of the European Union, including the United Kingdom, in bringing about an extension of democracy, an extension of recognition of the rule of law, and an extension of a willingness to settle conflicts peacefully throughout the whole of Europe—West and East—at the present time is an astonishing achievement. It is high time that this country, this Government and the governments of Europe should more widely recognise it. We are happy to take up the Prime Minister's challenge. We have been on the battlefield for a very long time. We look forward to getting the truth across and to making the central argument for a Britain that lies at the heart of a united Europe.
Baroness Amos: My Lords, I thank the noble Lord, Lord Strathclyde, and the noble Baroness, Lady Williams of Crosby, for their comments. I shall have to disappoint the noble Lord. I am entirely happy with the Government's position, as I am with the statement I made some days ago. I say that because it is absolutely true. Referenda have been used for wholly new constitutional structures. That is not the case here; that has not changed. But the Government recognise that it is time to take on the myths, absurdities and misinformation about Europe. That is what we intend to do and is why we have changed our position.
We say this clearly and openly: it is not to do with the constitutional position on referenda; it is to do with the myths and absurdities about Europe. There is no problem about that. Given that he has quoted hack at me, perhaps the noble Lord would like to hear what his own leader has said about referenda:
"A pre-legislative referendum is designed to pre-empt parliamentary debate. It is not a new device. The device was the hallmark of continental dictatorships between the wars. European

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tyrants used the plebiscite to sideline their Parliaments; they used it to suppress the rights and liberties of their citizens".—[Official Report, Commons, 21/5/97; col. 736.]
I repeat: those are the words of the leader of the party of the noble Lord, Lord Strathclyde, not mine.
The noble Lord asked specifically about the timing of the referendum. I think that that was answered in the Statement. We have made it absolutely clear that, if possible, we want to see agreement on the treaty by June. Following that there will be parliamentary debate, after which it will be put to the people. The details have yet to be decided, of course, but the rules that will govern the referendum, including those on funding and campaigning were decided by the Political Parties, Elections and Referendums Act 2000. The Electoral Commission is in charge of ensuring that the rules are upheld.
I turn to the constructive offer made by the noble Lord, Lord Strathclyde, to meet to talk through timetables. That is something that the noble Lord wants to see, but it is not necessarily sought by the whole House.
I welcome the positive comments made by the noble Baroness, Lady Williams of Crosby, including those on going out and arguing the case very forcefully. In response to her point about a greater degree of subsidiarity, I have looked for the exact quotation in the White Paper but have been unable to find it. However, provisions on subsidiarity are already included in the treaty and we would want to build on those.
It is absolutely the case that the constitution will make enlargement work. We have said so time and time again. That is why we are in favour of the new structures being proposed. As regards timing, although I may repeat what has been set out in the Statement, some provisions will come into effect in 2007 and others by 2009.
I turn to the comment made by the chairman of the Electoral Commission, an issue raised, I think, by the noble Lord, Lord Strathclyde. I believe that the chairman said that he would prefer the referendum not to coincide with a regional referendum. However, as I have said, we want in any event Parliament to be given the opportunity to scrutinise the treaty first.
I think that I have addressed all the points that were raised.
3.43 p.m.
Lord Renton: My Lords, in her original Statement the noble Baroness very properly listed those matters over which we and each of the member countries will retain sovereignty. But there are a number of other matters over which we shall either share or surrender sovereignty. Will she kindly list those?
Baroness Amos: My Lords, we have made it absolutely clear that in certain areas, including defence, social security, taxation and so forth, we have red lines. There are a number of areas— this will not change—where, as a result of successive treaties, issues
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are dealt with by majority vote rather than by unanimity. I am perfectly happy to write to the noble Lord about those, but the list is rather long.
Lord Clinton-Davis: My Lords, does my noble friend agree that Parliament has a decisive role to play in this matter? In discharging that role, all the vital provisions of the treaty have to be considered. That is my view.
Of course, when the noble Lord, Lord Strathclyde, refers to "expediency", he forgets entirely that the expediency of the Conservative opposition is dictated by the thought that they can win. However, does my noble friend agree that that would not be the first time that they have been wrong?
Baroness Amos: My Lords, I totally agree with my noble friend that Parliament must play a decisive role. As my noble friend says, the noble Lord, Lord Strathclyde, has talked about this matter being a point of principle for his party. I have to say that, if this is a point of principle for his party, there would have been a referendum on Maastricht.
Lady Saltoun of Abernethy: My Lords, I first heard several days ago, at the weekend, I think, that the Prime Minister had agreed to hold a referendum on this matter. It was discussed at great length on the "Today" programme this morning and it has provided the headlines for the front pages of the newspapers.
I know that I am old fashioned, but I think it is a very grave discourtesy to Parliament when matters of this kind are leaked to the press before they are made known to both Houses of Parliament; that is to say, unless there is a grave emergency and Parliament is not in session. However, that was not necessary on this occasion.
I do not accuse the Government specifically; the previous government also made a habit of doing this. However, I do think that it is very discourteous to leak the contents of Statements before presenting them to Parliament.
Baroness Amos: My Lords, I hear the comments of the noble Lady, Lady Saltoun. We have come to Parliament and made a Statement. As the noble Lady knows, my right honourable friend the Foreign Secretary was due to make a Statement on the White Paper on Europe. However, my right honourable friend the Prime Minister made the Statement instead because of the importance that we attach not only to the White Paper, but to the decision that has been taken about a referendum. That is why we have come to Parliament today.
Lord Mackay of Clashfern: My Lords, I am grateful to the Leader of the House for repeating with such clarity the Statement in this House. I wonder whether she can tell us how it came about that the BBC, on the

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10 o'clock news on Sunday night, was able to intimate that the Government had decided to hold a referendum.
Baroness Amos: My Lords, the noble and learned Lord will know that the Government do not comment on leaks.
Noble Lords: Oh!
Lord Mackay of Clashfern: My Lords, the question is: was it a leak?
Baroness Amos: My Lords, I can only repeat what I have just said. The Government do not comment on leaks.
Lord Stoddart of Swindon: My Lords, the Statement concludes with the words:
"Let the issue be put. Let the battle be joined".
I have to tell Members of the House, if they do not know already, that I have been battling for the past 40 years and I am quite happy to continue to do battle for as long as it takes to win the war.
I welcome the Statement and the fact that we are to have a referendum. However, I have to say that the simple Statement is accompanied by some tendentious argument, which I should like now to join. However, there is no time so I shall not do so.
My main question is what is meant by Parliament being able to debate the constitution in detail and being able to decide upon it. What will Parliament be able to do? Will it be able to say only yes or no to the constitution or will it be able to debate the constitution in a proper Bill which will be debatable and amendable? That point is important and absolutely crucial. If Parliament is to discuss the matter first, surely it must be able to make amendments to what is a new constitution. I would like a straight answer to what I believe is a straight question.
Does the noble Baroness agree that once we have the constitution we shall have it for ever, as it can be amended only by unanimity? The provisions of the constitution will be at the will not of our Government or of any other government in the new European Union, but of the European Court of Justice.
Baroness Amos: My Lords, the noble Lord, Lord Stoddart, has been battling on this point for a very long time. Now we all have the freedom to join in. Of course, I admire his restraint in not going into detail on the specific issues.
The debate in Parliament will be as on any other treaty. The treaty is unamendable, but the Bill will be amendable. That is what we have always done. My noble friend Lady Symons informs me that with the last treaty that we discussed through a Bill, we spent some 50 hours debating the Bill. It would be wrong to say that Parliament has in any way been short-changed
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in that process. The noble Lord is right to say that amendment of the constitutional treaty would be by unanimity.
Lord Blaker: My Lords, in explaining the reason why the Government have made this extraordinary change in their attitude towards a referendum, the noble Baroness referred to what I can describe only as the pathetic list of Aunt Sallys that the Statement contained in criticism of the Conservative attitude towards the European Union, none of which, in my view, has any validity. To me they all seem intended to give the impression that a Conservative government would leave the European Union. Perhaps I may remind the noble Baroness and those on the other side of the House that only one party in Parliament has ever been officially in favour of leaving the European Union and that is hers. The Prime Minister was a leading member of the party at the time.
Baroness Amos: My Lords, the leader of the party opposite has made it absolutely clear that he would want to see the treaty renegotiated. That is not the position of any of the other governments in the European Union, which means that, at the end of the day, this matter is about leaving the European Union.
Lord Lang of Monkton: My Lords, given the Government's well known anxiety about fighting apathy in elections and the importance that a major step of this kind should be embarked upon only with the full-hearted consent of the British people, will the Government introduce into the referendum a minimum threshold, as they did with the 1979 referendum on Scottish devolution?
Baroness Amos: My Lords, as I said in reply to an earlier question, the details of the referendum are still to be decided.
Lord Kilclooney: My Lords, assuming the Statement means that we are to have a referendum, can the noble Baroness confirm, at least in general, that the question will specifically refer to the new constitution of the European Union and will not involve wider issues, such as membership of the European Union?
Baroness Amos: My Lords, the question will be about the constitutional treaty.
Lord Ezra: My Lords, I want to refer back to what I consider are the fundamental issues involved; namely, that one of the biggest developments since the last war has been the creation of the European Union. The second biggest development is the massive extension, by agreement of the present member countries, to include 10 countries of Eastern Europe. Therefore, the task of the Government should be to see that the constitution that is now being debated in Europe is a suitable constitution for that enlargement, which all parties in this country have at one time or another

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supported. Once that constitution is devised, it is right that Parliament should debate it and it is right that the country should decide on it.
Baroness Amos: My Lords, the noble Lord is quite right. The issue concerns the expansion and the enlargement of the European Union. We also have to ensure that in negotiating the treaty we do what is best for Britain.
Lord Pearson of Rannoch: My Lords, is it true that there are two fundamental errors in the Statement. The first is the suggestion that the proposed treaty is a big advance in subsidiarity. Is it not true that the document that we had before Christmas, which was torpedoed by the Spanish and the Portuguese, allowed for only two-thirds of national governments to object to a Commission proposal? The Commission merely had to take away a proposal, look at it and if it did not want it, it could carry straight on. Secondly, and far more importantly, is the Prime Minister's red line on tax a red herring? Has the Leader of the House read your Lordships' debate on 25 February this year? Although it is clear under the official tax provisions of the treaty, particularly at Clause 93, that unanimity is required for indirect tax, the treaty is silent on direct tax, unless one looks at Clauses 43 to 44—the single market provisions of the treaty—where the Commission is already free to propose, and the court is already free to agree. Is it not clear that direct tax has already passed to Brussels?
Baroness Amos: My Lords, we have made our position clear on this matter. We have said that tax matters will continue to be decided by unanimity. Paragraph 76, on page 35, of the White Paper published in September 2003, states:
"Tax matters are a key component of national sovereignty and vital to the social and economic well being of the country. It is for this reason that the Government made a manifesto commitment to maintain the UK's tax veto".
That is why in the IGC the Government will insist that tax matters continue to be decided by unanimity. That was our position when the White Paper was published last year and it continues to be our position.
The treaty already has major provision for subsidiarity, the mechanism allowing national parliaments to object to any Commission proposals that breach that principle. That is the first time that such a provision has been put in place.
Lord Brooke of Alverthorpe: My Lords, is my noble friend aware of the conflict with what the noble Lord, Lord Strathclyde, said, that there are many noble Lords in the House who are in favour of postal ballots? The evidence indicates that postal ballots will enable us to reduce the degree of apathy that has been encountered. Will the Government bear in mind that some people are in favour of postal ballots on such issues? When we come to deal with the details of the
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Bill, it may be possible to introduce postal ballots to extend the franchise to those who cannot get to ballot boxes.
Baroness Amos: My Lords, my noble friend makes a very good point. I shall ensure that it is taken on board when the details
are being worked through.
Baroness Park of Monmouth: My Lords, I am sure that the Leader of the House agrees that in all such issues the devil is in the detail. What do the Government intend to do to allow both Houses to discuss the difficult and contentious points of detail—the ones that really matter—in full debate, as we would debate a Bill? If we are simply to have a debate, which was all we succeeded in having before December—I recognise that committees in both Houses have produced many reports on the significance of the constitution—ordinary Members of both Houses will have an opportunity to discuss the details. It seems to me that if we are to go to the country saying, "Parliament takes the view"—whatever it is—and, as we know, we cannot revoke the treaty or change the detail, we need to be seen to have discussed the detail so that the public as a whole can know what is at issue.
Baroness Amos: My Lords, I am not sure that I entirely follow the noble Baroness. This issue will be debated in the form of a Bill. That means that we will be able to debate each clause. I am not sure whether she clearly understood the point that I made in relation to that.
I should also say to the noble Baroness that the House has had ample opportunity to discuss European issues. We shall continue to have such opportunities. She will know that during the IGC process a special committee was established to look at this issue, which was open to any Peer or MP to attend.
Lord Lea of Crondall: My Lords, does my noble friend agree that in 1975 when a referendum was called, the Gallup polls were predicting that people would vote substantially against but by the day of the referendum they were two-thirds in favour? Is it not the case that, on balance, the process that has now been set in train contains a great educational element and that the newspapers, even if they are vitriolically against everything to do with Europe, cannot get in the way of the people understanding the real reasons why we have to go forward together to work out matters in Europe?
Baroness Amos: My Lords, I agree with my noble friend: there is a need for a greater educational element and a greater degree of understanding. I am sure my noble friend noticed that when the possibility of a referendum was put to the individuals who were interviewed yesterday, many of them said that they did not understand what the issues are about. I have been pressed many times in the House—particularly by

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noble Lords on the Liberal Democrat Benches—about the need for the Government to engage in a public awareness-raising campaign on these issues.
Lord Thomson of Monifieth: My Lords, further to the previous question and the Minister's reply, sadly, some of us have been over this course of a referendum in relation to Europe many times in the past. But, as the Government have now set their face on this course, is the Minister aware that the reason for the degree of negative public opinion about Britain in Europe is, at least, very substantially a result of the timidity of the Government in dealing with these issues? Now that they have set their course and we have immediately ahead of us elections involving Europe, can the Minister give an assurance that the Government will now pull out all the stops and unequivocally back the case for Britain being at the very heart of an expanded European Union?
Baroness Amos: My Lords, I can assure the noble Lord, Lord Thomson of Monifieth, that that is entirely what the Government want to do. The robust nature of the Statement made that absolutely clear.
Earl Ferrers: My Lords, can the noble Baroness explain how the Bill can be amendable if the treaty to which it refers is unamendable?
Baroness Amos: My Lords, so long as any amendments proposed to the Bill do not amend the treaty, the Bill is of course amendable.
Lord King of Bridgwater: My Lords, can the Minister answer the point raised by my noble friend Lord Strathclyde? She did not mention the word "referendum".
Baroness Symons of Vernham Dean: My Lords, I am terribly sorry but we are out of time.

Northern Ireland
4.4 p.m.
Baroness Amos: My Lords, I should like to repeat a Statement made in another place by my right honourable friend the Secretary of State for Northern Ireland. The Statement is as follows:
"Mr Speaker, with permission, I should like to make a Statement about a report I have received from the Independent Monitoring Commission concerning paramilitary activity in Northern Ireland.
"Before I move to the substance of my Statement, I should like to take this opportunity to condemn in the strongest terms yesterday's sending of suspect packages to two elected representatives in Northern Ireland, the honourable Member for Belfast East and Mr Alex Attwood. I am sure the whole House will join me in that. Police investigations into these incidents are continuing.
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"As the House will recall, the Independent Monitoring Commission was set up by an international agreement, supported by legislation we passed in this place last year. It is composed of four distinguished members: John Grieve, former Assistant Commissioner of the Metropolitan Police and Lord Alderdice, formerly Presiding Officer of the Northern Ireland Assembly, both nominated by the British Government; Mr Joseph Brosnan, formerly the Secretary of the Irish Department of Justice, nominated by the Irish Government; and Mr Dick Kerr, formerly the Deputy Director of Central Intelligence in the United States, nominated by the US Administration.
"Last Wednesday, the British and Irish Governments received the Commission's first report. I am today laying it before the House as I am required to do by law. Copies of the report will be available in the Vote Office at the conclusion of my Statement.
"The report is concerned with the continuing activities of paramilitary groups in Northern Ireland. The Commission had originally expected to produce the report in the early summer but, at the request of the Governments, it has brought its production forward. At the request of the Governments, the report also specifically addresses the incident that took place at Kelly's Cellars, Belfast, on 20 February 2004 in the context of its wider analysis. That event, as the House will recall, caused profound controversy in Northern Ireland. This has in turn disrupted the conduct of the review of the operation of the Good Friday agreement that began earlier this year.
"We are most grateful to the Commission for advancing its report. This has clearly involved a great deal of work by all concerned. Notwithstanding the pressures of time, I believe they have produced a very thorough and far-reaching report. Both Governments accept the Commission's conclusions and recommendations.
"The Commission states that the situation it is now addressing is much better than it was in past years. However, the Commission finds that paramilitary activity is at a disturbingly high level on the part of both republican and loyalist groups. I quote from the Commission's report:
'On the basis of reported figures—which, especially for assaults, may not reflect the full picture—the scale of paramilitary violence since 1 January 2003 has been worryingly high: approaching one murder a month; some three victims a week both from shootings and from assaults'.
"The Commission goes on to state that two parties represented in the Assembly, Sinn Fein and the Progressive Unionist Party, have links with paramilitary groups. It is clear from the report that senior politicians are in a position to exercise significant influence over their activities.
"The Commission also expresses its belief that the incident in Belfast on 20 February was the responsibility of the Provisional IRA.

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"The Commission urges elected politicians in Northern Ireland to commit themselves to supporting the rule of law and the criminal justice institutions.
"The Commission says that, in the absence of a sitting Northern Ireland Assembly, it is not possible for it to make recommendations on measures which the Assembly itself might consider taking in response to its report. However, the Commission makes clear that,
'had the Assembly now been functioning, we would have recommended in respect of Sinn Fein and the Progressive Unionist Party measures up to and possibly including exclusion from office'.
"But, in the absence of a sitting Assembly, the Commissions recommends—and I quote—that I,
'should consider taking action in respect of the salary of Assembly members and/or the funding of Assembly parties so as to impose an appropriate financial measure in respect of Sinn Fein and the Progressive Unionist Party'.
"When we debated the legislation relating to the Commission last year in this House, I made it clear that the Government believed it very important that the Commission's recommendations should be given effect. And I indicated that, in circumstances where the Commission had made recommendations but action had not been taken, I would be able to use the powers of last resort granted to me by the Act to take action myself in line with such recommendations.
"In the light of this, and having considered the report, I am persuaded that it would he right to remove for a period the entitlement to the block financial assistance paid to Assembly parties in respect of both Sinn Fein and the Progressive Unionist Party; and I propose to do so next Wednesday, 28 April.
"I have therefore today made an order under the urgency procedure, amending the Northern Ireland Act 1998 as amended by the legislation we passed last year, to allow me to take this step in the absence of a sitting Assembly. It will also permit me to act to reduce Members' salaries should I see fit to do so in the light of a future IMC report.
"I will, however, in line with the legal requirement on me to act fairly, take account of any representations I receive by next Tuesday from the two parties concerned, before reaching a final decision.
"The Commission's other recommendations, all of which the British Government endorse, include that paramilitary groups must cease all forms of criminal activity; and that all politicians and others in prominent roles must exert every possible influence to bring about a cessation of paramilitary activity.
"I hope that this report, and the firm but carefully measured action that the Government are taking in response to it, will underline that it is essential that all paramilitary activity, from whatever quarter, should cease fully and completely. The Commission's next report on paramilitary activity will be able to test whether that has happened and, if not, whether further action is needed.
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"In the mean time, the Government remain firmly committed to the idea that political progress can only be achieved through dialogue. I shall continue to meet all the parties in Northern Ireland to explore how we can achieve the basis for a restoration of the devolved institutions. Already in the context of the review, a number of interesting proposals have been made. There is still much to discuss.
"This report underlines starkly what steps need to be taken if we are genuinely to move forward to stable and inclusive devolved government. I must reiterate what the Prime Minister, the Taoiseach and others have said on many occasions: all paramilitary activity must come to an end if there is to be a stable future for devolved government in Northern Ireland. That is what the Prime Minister spelt out when he talked of acts of completion. It is what both Governments made clear in paragraph 13 of the joint declaration. The Commission itself recognises in its report that violence and the threat of violence can have no part in democratic politics.
"The Independent Monitoring Commission has, I believe, a vital role to play in securing that development and underpinning it once devolved government is reestablished. It has, through this report, demonstrated its impartiality, its competence and its willingness to speak the truth, even when it is uncomfortable to do so. I believe the whole House will be grateful to it".
My Lords, that concludes the Statement.
4.13 p.m.
Lord Glentoran: My Lords, I thank the noble Baroness the Lord President of the Council for repeating the Statement made by the Secretary of State for Northern Ireland in the other place and, overall, welcome it. Noble Lords on this side of the House wish to associate themselves with the comments in the report concerning the suspect packages which were sent to Mr Peter Robinson, MP, and Mr Alex Attwood.
We welcome the report; we also welcome Her Majesty's Government's acceptance of it. I congratulate the Commission on the courage it has shown in facing the facts and the forthright way in which it has presented them. I also thank it for reporting so promptly—admittedly, under pressure from this side of the House and, in turn, from the Government. But it has done so and has, I suspect, faced considerable difficulty in so doing. We owe it our thanks.
For most of us in this House and those of us who live in Northern Ireland, there is little new in the report. We have known for many years that the level of paramilitary activity has been totally unacceptable and would never have been accepted in other parts of the United Kingdom. We have known of the organised crime syndicates run by the paramilitary groups, including extortion, drugs and smuggling.

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We have also known that on both sides, political parties—one of which has played a role in the government of Northern Ireland and, believe it or not, still has that aim—are in control of many of the organisations and that their political parties and terrorist organisations are funded by these illegal activities. What, perhaps, is even worse, is that they are also in control of the areas on the ground in which they operate. This report, for the first time, confirms this—and that is to be welcomed.
Paragraph 7.5 of the report also confirms that,
"Sinn Fein must bear its responsibility for the continuation by PIRA of illegal paramilitary activity and must recognise the implications of being in this position".
In this context, does the Minister share my concern at the words of Martin McGuinness, one-time Minister of Education for Northern Ireland, in a speech he made at Carrickmore on Easter Sunday—just last week—when he paid tribute to the role the IRA had played "and continues to play" in the struggle for Irish freedom?
I wish to ask the noble Baroness a number of questions. What further measures will Her Majesty's Government take to ensure that all the areas of Northern Ireland are fully policed and that there are no "soft areas"—known at one time as "no-go" areas—in which paramilitaries can operate with comparative immunity? Will she undertake to ensure that the full force of the Customs and Excise is available to stamp out smuggling and that there are no "soft corners" of the border in this regard? Smuggling has been going on in a major way, which is a disgrace in Europe, let alone inside the United Kingdom.
Furthermore, will the noble Baroness confirm that the watchtowers in South Armagh, which are principally there to help to prevent such irregularities as smuggling, will remain and that there will be no more security normalisation moves until the Independent Monitoring Commission reports that, in its opinion, the security situation in Northern Ireland has indeed been normalised and there have been acts of completion?
Does the noble Baroness really think that the financial sanctions against Sinn Fein and the PUP will have any significant impact, given their access to alternative, illegal forms of funding? Will she ask her right honourable friends in the other place to remove all the privileges, offices and allowances given by this Government to Sinn Fein in the Palace of Westminster? Will she confirm that in respect of Sinn Fein participating in the government of Northern Ireland, the same rules will apply in Belfast that the Taoiseach rightly insists upon in Dublin?
Finally, I was going to wish Her Majesty's Government well in the discussions that were due to take place next week. These, we understand, have now been cancelled. Could the noble Baroness the Lord President of the Council enlighten us as to why?
4.19 p.m.
Lord Shutt of Greetland: My Lords, I, too, thank the noble Baroness, the Lord President of the Council, for repeating the Statement that was issued in the Commons. I also thank the Independent Monitoring Commission for its report. I reiterate the concern, and condemn the sending of the suspect packages to the two Northern Ireland politicians.
The report is a very valuable document by the independent monitors, setting out the position as they see it. If one looks at the schedule of the paramilitary groups, the report makes for a very sobering read. Seven groups are listed, and the report states that the seventh, the UVF and the RHC,
"are linked organisations. Both are relatively small, the latter particularly so. The number of their active members is a few hundred".
The report says "relatively", but relative to what? How many can there be in the seven groups of paramilitary organisations altogether? If a few hundred is relatively small, the total must be very large indeed. There is a problem in terms of the numbers in paramilitary groups in Northern Ireland, whether they are active or dormant.
The major finding from the report is that there is less death but more damage. There is less death—although there are still deaths created by acts of the paramilitaries—but more damage. There has been a steady increase in shootings and assaults, and paramilitary theft and drug dealing on top of the violence. We are told that the ceasefires have meant a more peaceful Northern Ireland, but we must move on from ceasefires to the totality of illegal paramilitary activity.
The report then refers to the two groups that have Assembly links and what should be the sanctions. When we refer to sanctions, we are really talking about fine judgments. The report recommends reducing or withdrawing the salaries of Assembly Members or the funding for Assembly parties. Those are among the lowest of the sanctions in the rankings set out in the report. Five of the sanctions may be exercised by the Secretary of State, but, because the Assembly is not functioning, perhaps these are the only two that are left.
I wonder whether it is wise to use what appears to be a minor sanction relating to the loss of some funding to the Assembly parties. Would it not turn those people in the wrong direction further still? Is that sanction wise when the five other paramilitary groups would not be affected by any sanction of that nature, especially if it were decided to withdraw salaries? Bearing in mind the comments of my noble friend Lord Smith of Clifton about the withdrawal of salaries in other circumstances, is this the right step to take with this group of Assembly Members? It may be the right course of action for the totality of Assembly Members if it really does seem that there is no prospect of the Assembly functioning again.
My second point is related to what the noble Lord, Lord Glentoran, was talking about. Where are we going when we talk about moving forward? I had the

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privilege of being in the other place where I heard the Minister answer the various questions that were asked. An honourable Member asked why the talks were being deferred, and the Minister replied that there had not been enough time to prepare. I do not think that lack of time to prepare has been a problem, by and large, in Northern Ireland. There has been all of this century and most of the last, so I do not understand this lack of preparation. What is the real hold-up? I worry that a vacuum is being created, and vacuums in Northern Ireland are not a good thing. Idle hands tend to find something to fill them. What is the score in terms of moving forward?
4.24 p.m.
Baroness Amos: My Lords, I would like to respond to the points made by the noble Lords, Lord Glentoran and Lord Shutt of Greetland. In his opening remarks, the noble Lord, Lord Glentoran, said that there was little new in the report and that the people of Northern Ireland knew what had been happening to them. He is quite right. The report reflects what is happening on the ground. As he said, it does not necessarily make very pleasant reading.
The noble Lord, Lord Glentoran, spoke about "soft areas". There are no areas where the security forces do not operate and where the rule of law does not run in Northern Ireland. Of course, it is harder to operate in some areas than others, but the police nevertheless do operate. I know that the Chief Constable takes very seriously the activity set out in the IMC report. He is and always has been determined to tackle these problems. The noble Lord knows that the establishment of a crime operations department, the introduction of the national intelligence model, engagement in the Organised Crime Task Force and engagement with the Assets Recovery Agency all build on the Police Service of Northern Ireland's expertise in tackling paramilitary activity.
The noble Lord, Lord Glentoran, also asked about the normalisation process. I reassure the noble Lord that the normalisation programme annexed to the joint declaration of May last year has not begun, nor will it begin until the necessary enabling environment is in place. He also pressed me on would happen next, as did the noble Lord, Lord Shutt of Greetland. We all know that the events of 20 February created a hiatus in the review process. It is important that we now do all that we can to resume dialogue. There are important issues on the review agenda and the sooner that we can get back to them the better. Noble Lords will be aware that the two Governments are meeting tomorrow at the British-Irish Intergovernmental Conference, where we shall take stock on the future shape of review activity. My right honourable friend said in another place that we hope that the intensive discussions that we had anticipated starting next week will now resume a little later in the summer.
On having the same rules in Belfast as in Dublin, we have made it absolutely clear that there is no future for devolved government in Northern Ireland except where all its Members are committed to exclusively democratic and peaceful means. We will continue to make that point.
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The issue of salaries was raised by the noble Lord, Lord Shutt, who also made wider points about the proposed sanctions. The Commission makes it clear that,
"had the Assembly now been functioning. we would have recommended in respect of Sinn Fein and the Progressive Unionist Party measures up to and possibly including exclusion from office",
which is the highest sanction provided for under the 1998 scheme. However, the Assembly is not functioning, and the Commission found a different sanction more appropriate. We believe that the act of imposing these measures as well as the substance of them demonstrates clearly the unacceptability of the conduct revealed in the report.
We should not forget that crimes continue to be investigated by the police and the perpetrators brought to justice. This is not an "either/or". We are working to the political elements that the report has identified. Indeed, it talks about the nature of political leadership in this respect, which is an important matter for us to address.
On the wider point of salaries in the Assembly, my right honourable friend the Secretary of State for Northern Ireland has made it clear that he will conduct some kind of review of that in the not-too-distant future.
Lord Glentoran: My Lords, can the Minister give an undertaking on the Customs and Excise point?
Baroness Amos: My Lords, my apologies for not responding to that point. I believe that the noble Lord asked me to assure him that the full force of Customs and Excise will be made available. I can assure him on that point.
4.31 p.m.
Lord Rogan: My Lords, I, too, welcome the Statement repeated by the Lord President, and the report from the International Monitoring Commission. The report highlights the stark truth about the continued paramilitarism, racketeering and gangsterism in Northern Ireland today. It uses plain language to spell out the nature of those activities and the groups behind them. As has been discussed today and on previous occasions, the proceeds of those heinous crimes fund political parties—the very same political parties that the IMC has recommended taking action against. There is therefore a clear case that, alongside the financial penalties announced today, the Government should also use the findings of the report to bolster the resources and powers of the Assets Recovery Agency, so that moneys gained through these illegal activities are once again cut off from the perpetrators of the crimes. Moreover, the Secretary of State should use his powers under the prisoner release legislation to ensure that those responsible are taken from our streets once and for all.
Baroness Amos: My Lords, I thank the noble Lord, Lord Rogan, for his comments. In response to the questions raised by the noble Lord, Lord Glentoran, I

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made it absolutely clear that the Police Service of Northern Ireland will work with all those who have a responsibility in this respect, including the Assets Recovery Agency.
The IMC made clear that all politicians and others in prominent roles must exert every possible influence to bring about a cessation of paramilitary activity. The Commission notes that organised crime does not recognise borders. This is something that needs to be tackled not only in Northern Ireland but more broadly. I am happy to be able to tell the noble Lord, Lord Rogan, that the Assets Recovery Agency, the new body, is working well.
Lord Kilclooney: My Lords, does the Minister recall that when we reached the Belfast agreement in 1998, the southern Irish Government were specifically excluded from the internal affairs of the Northern Ireland Assembly? Does she recognise now that a representative of the southern Irish Government has been involved for the first time in deciding the affairs of the Northern Ireland Assembly? That is a precedent for a representative of the southern Irish Government to be making recommendations as to the payments for Members of the Assembly and whether they should be suspended. This is a historic moment: the Dublin Government are involved in the internal affairs of the Northern Ireland Assembly.
Secondly, does the Minister recognise that throughout Northern Ireland, among both the nationalist and Unionist communities, the Government will be laughed at for their decision to have minimal deductions in moneys made available to Sinn Fein, which is one of the richest political parties in Europe? Sinn Fein will laugh, the SDLP will be horrified, and Unionists will laugh as well. The Government have acted very badly in that matter. It will have no impact whatever.
Thirdly, and regrettably, does the Minister recognise that Sinn Fein/IRA, by continuing its violence, holds a veto over the establishment of a devolved government at Stormont? Therefore, regrettably, the Government must soon proceed with the decision that a devolved government on the basis of the Belfast agreement is unattainable and that sooner rather than later the suspended Assembly will have to be dissolved.
Baroness Amos: My Lords, the noble Lord, Lord Kilclooney, asked me three questions. I shall seek to answer all of them.
On the first point, about the representative from the Irish Government, the IGC terms make it absolutely clear where that representative can be involved. If the noble Lord would like me to spell that out in greater detail, I shall be very happy to do so in writing.
As for the deductions that have been taken and the decisions made in relation to the sanctions, the noble Lord will know, having looked at the report, that we are carrying out the recommendation made by the IMC. If the Assembly had been sitting, of course, different sanctions would have been available. I recognise that to a certain extent that is symbolic—it is
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an expression of disapproval. But it is very important, having said that we would carry out the recommendations made to us by the IMC, that we seek to do so to the best extent possible.
On the noble Lord's final point, he will be aware that we have been working together through this process, trying to ensure that there is an inclusive process that leads to greater stability and to devolved government in Northern Ireland. That is our aim, and we shall continue to seek to achieve that.
Lord Hylton: My Lords, while I understand some of the misgivings expressed on the Liberal Democrat Benches, on balance I welcome this report and the Government's proposal for action with effect from 28 April. The level of murders and personal violence described in the Statement is clearly unacceptable, even if it is much lower than that which prevailed before 1994. The question therefore arises of how we reduce and prevent that violence.
I suggest to the Leader of the House that a combined effort is required, through public opinion, particularly as is articulated and expressed through the Churches and voluntary organisations, through the legitimate constitutional political parties and, of course, through all government agencies, some of which have been mentioned already, notably the security services. Do the Government accept that such a combined effort is necessary and will they, in conjunction with the Irish Government, give that kind of leadership from day to day? Will they orchestrate a campaign to eliminate violence and thus to give the Belfast agreement a chance to function as was intended?
Baroness Amos: My Lords, I must say to the noble Lord, Lord Hylton, that I feel that the Government have been seeking to give precisely the kind of leadership that he has just articulated. Of course, a combined effort is required. We could not achieve what we want without the people of Northern Ireland themselves wanting to see it achieved, and they have made their views on these matters absolutely clear. Of course, we need to have the parties on board, which is why we have sought to maintain an inclusive process while making it absolutely clear that paramilitary activity must end. Of course, the government agencies need to be involved, and the role in this process of the Police Service of Northern Ireland and other agencies, including Customs and Excise, is absolutely crucial.
Viscount Brookeborough: My Lords, in thanking the Minister for the Statement, I would also like to condemn the two recent letter bombs, or suspected letter bombs, one of which was sent to one of my colleagues on the Policing Board.
The report has brought home for the first time to everybody in Westminster as a whole what we have been saying for a long while; I refer to what is going on on the ground. The Commission has made a tremendous job of producing the report in a short time. However, people should not consider that it gives the whole story; the Commission would say that it would have liked more time.

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I take minor issue with one point, which is given on page 19, where the Commission states:
"The situation we now address is much better".
Will the Lord President say exactly what that refers to? There is only one graph in this report that shows any improvement, which relates to the recent number of deaths attributable to paramilitaries and goes back only to 1998.
The Commission has not existed for long and we must go back further than that to the first cease-fire, for instance. There was a period between about 1994 and 1997 when things improved dramatically. If one takes out the reduction in the number of people being killed, every other statistic is worse than it was in that period. The other graphs show that matters are going on steadily. The one graph which goes back any distance is on page 20, which covers paramilitary-style shootings and assaults. It shows a dramatic increase. Therefore I differ on accepting that conditions are better. I feel that when the Commission produces its next report, and I ask the Minister when that will be, it will show that in the very short term things may, in its view, be slightly better, but in the medium term they are worse than they have been for some time.
Baroness Amos: My Lords, the noble Viscount has identified the complexity of the situation with which we are dealing. The report makes absolutely clear—I am looking at page 25—that while the number of murders, attacks on security forces and bombings by paramilitaries has sharply decreased, the level of other paramilitary violence has been, and continues to be, considerably higher than before the Belfast agreement. The report goes on to extrapolate from that.
The Commission has been asked to report twice yearly so I am anticipating that the next report will he in about six months' time.
Baroness Park of Monmouth: My Lords, I also very much welcome this report and am greatly encouraged by it, with the reservations that have been expressed around the House, but I have two questions. First, are any steps going to be taken to publicise this report in the United States? It is surely a reasoned counter to the claims made by Sinn Fein in the article for which it paid. Secondly, will the Commission address the issue of the impossibility of people speaking to the press about what happens to them or turning to the police about it? I make a distinction between what the police do and the degree to which the community feels free to go to them. I should like answers to those two questions.
Baroness Amos: My Lords, the answer to the first question on publicising the report in the United States is, "Yes". Steps will be taken to do that. One of the members of the IMC is nominated by the United States Government.
On the noble Baroness's second point, which I think is asking whether the IMC will be able to investigate the difficulties that individuals have in speaking openly about what has happened to them, one of the
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things that the IMC made clear in this report is that it did not rely on evidence from security sources but went elsewhere to get the kind of evidence used in this report. It has made it clear that this is something that it will want to continue to do. I am sure that it will take on board the debate that we are now having on this issue and I shall come back to the noble Baroness with more detail on this point if I can.

Energy Bill [H.L.]
4.44 p.m.
Lord Grocott: My Lords, I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Energy Bill, have consented to place their prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Bill read a third time.
Lord Ezra Lord Ezra moved Amendment No. 1:
After Clause 2, insert the following new clause—

ANNUAL REPORT ON ENERGY EFFICIENCY
The Secretary of State shall publish in such form as he sees fit an annual report setting out what steps he has taken and proposes to take to secure carbon savings from domestic energy efficiency of 5MtC per annum by 2010 and a further 4MtC per annum by 2020."
The noble Lord said: My Lords, this amendment raises an important aspect of the Government's energy policy, where it is made quite clear that energy efficiency must play a very large part in securing the reduced carbon emissions to which the Government are committed under the Kyoto objectives and in other ways. I realise that the Government are shortly to produce a report on domestic energy efficiency and, no doubt, that will contain a lot of positive proposals, which we shall he interested to read. Unfortunately, this is our last opportunity to introduce a provision on this subject into the Bill. Therefore, in anticipation of that report, and on the assumption that it will stick to the indications given in the Energy White Paper, we feel that this should be an opportunity for stating quite clearly that these are the objectives.
The fact is that these were not clearly stated as objectives in the White Paper but it was subsequently made quite clear in statements by Ministers that the Government considered themselves committed to it. For example, I remind the Minister that, in answer to a Question from my noble friend Lady Maddock in October of last year he said that the Government regarded it as a commitment to save 5 million tonnes of carbon emissions by the year 2010. In his consultative document on ways in which fiscal measures could be introduced to stimulate energy savings, the Chancellor of the Exchequer stated these objectives at the beginning of that report. As this issue was in the Energy White Paper, and as Ministers have repeatedly stated their commitment to these objectives, we feel that this is an opportunity to give this important issue

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statutory backing. It goes no further than the White Paper, no further than has been reiterated by Ministers on a number of occasions and I therefore beg to move.
Baroness Miller of Hendon: My Lords, I owe the noble Lord, Lord Ezra, an apology for not having put my name down to this very important amendment, which we most certainly support. Indeed, it is an apology to the rest of the House, who did not realise that we support this amendment. Why should they have realised that?
During the passage of the Sustainable Energy Bill, which is now an Act, on 12 September last year, I said that:
"We want … to ensure that the annual report is about real progress on real, firm, binding and achievable targets and not about vague and woolly 'policy goals'".—[Official Report, 12/9/03; col. 616]
But the Government would not accept such a clause and, regrettably, in another place they were able to force those who wanted such a clause to back down rather than lose the Bill.
The proposed new clause, to which the noble Lord, Lord Ezra, has just spoken, is very similar. It would require the Government to report on real progress and specific measures taken, and proposed, to achieve the savings from domestic energy efficiency announced in their own White Paper of 5 million tonnes of carbon (MtC) per annum by 2010 and a further 4 million tonnes of carbon per annum by 2020. The case for such a measure, which was strong enough last year, has become even more overwhelming and unanswerable in the light of recent developments, of which I shall mention just a few.
The Government's own sustainable energy policy website now lists the CO2 savings specified in the proposed new clause of 5MtC per annum by 2010 and a further 4MtC per annum by 2020 as "commitments" and "objectives". The proposed new clause requires the Government only to tell the public how they are getting on in achieving their own policy. Do the Government really object to that?
The noble Lord, Lord Whitty, confirmed that that was the commitment in a Written Answer to the noble Baroness, Lady Maddock, on 27 October 2003. Some 335 Members of the House of Commons—more than half the House—signed Early Day Motion No. 96 in support of the target, so we know the views of the elected representatives. By passing the proposed new clause today we in this House would respond to the views freely held, without pressure from their Whips, by Members of Parliament.
In the past year CO2 emissions have increased by nearly 2 per cent. making domestic energy efficiency all the more important. As the energy White Paper calls energy efficiency the cheapest, cleanest and safest way of achieving energy policy objectives, the public are entitled to know what the Government are doing, and propose to do, to reach the savings that are required by 2010 and the further savings that are required by 2020. While no one doubts that sustainable energy may cost money, we are all entitled to know that the cheapest viable option is being given due priority year in and year out.
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The Fuel Poverty Advisory Group has reported that at least 50 per cent more resources are needed if the Government's duty to end fuel poverty, established under the Warm Homes and Energy Conservation Act 2000, which was successfully promoted by my honourable friend David Amess, is to be met. Those organisations involved with combating fuel poverty have all written to the Secretary of State calling for a 20 per cent increase in domestic energy efficiency by 2010. The Government have already agreed that that 20 per cent is equivalent to savings of 5MtC, as specified in the proposed new clause. We need the new clause to ensure that we receive proper reports to show that the Government are on course to comply with the law.
In addition to the letter to the Secretary of State from all those involved in combating fuel poverty, just about every large industry and trade association concerned with producing energy saving materials has written in a similar vein stating that,
"if we are to secure the necessary funding (i.e. investment by the industry) then absolute and unambiguous quantified carbon saving commitments will be needed from government".
Today I have seen a document containing the highlighted words, "Policy in Confidence". It is a draft of the Government's energy efficiency implementation plan written on 2 March 2004. Paragraph 96 of the document states:
"However, the most recent update of the United Kingdom's energy projections has highlighted the fact that changes to our baseline projections mean that the existing package of measures may no longer be sufficient to keep us on track to deliver the expected absolute"—
the word "absolute" is underlined—
"emission levels. The current climate change programme is likely to under deliver by up to 7.5 MtC per annum in 2010".
The proposed new clause is all about commitments. It is about clear annual reporting on what the Government have done and what they propose to do. I refer to public accountability, the environment, combating fuel poverty, enabling British industry to invest and, indeed, public honesty.
I urge the Government to accept the very important new clause proposed by the noble Lord, Lord Ezra. If they do not, my colleagues will raise it in another place. My Front Bench team has also signed Early Day Motion No. 96, which I mentioned earlier. If the Government really do not want the measure and wish to defeat it, they will have to bully more than 200 Labour Members of Parliament who have repeatedly signed up to support these commitments, more than 100 of whom have issued press releases to their local papers committing themselves to supporting the commitments.
A final reason why the Government should accept the proposed new clause is contained in paragraph 3.49 of the energy White Paper. In that paragraph the Government promised that,
"we will report annually, as part of the follow up to this white paper, on progress towards achieving the savings we have set out".
Now is the time for the Government to show that they really meant those words.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty): My Lords, I accept what both the noble Lord, Lord Ezra, and the noble Baroness, Lady Miller of Hendon, said about the importance of energy efficiency and I do not resile at all from the objectives set out in that respect in the White Paper. However, the Government cannot accept that this amendment is necessary. The amendment would duplicate what is already in the Sustainable Energy Act 2003. It would also duplicate the energy efficiency aim which is to be published in fulfilment of the provisions of that Act, and to which the noble Lord and the noble Baroness referred.
The 2003 Act obliges the Secretary of State to publish annually a sustainable energy report on progress towards the four goals of energy policy as set out in the energy White Paper. That clearly includes progress on all the main contributors towards that goal, which include energy efficiency. Therefore, we are already obliged to do that. We shall shortly publish a first annual report and the energy efficiency implementation plan of which the noble Baroness appears to have had sight of an early draft. We are doing that in pursuit not only of our commitments but also of the obligations under the Sustainable Energy Act. The principle in the measure that we are discussing would duplicate that. The figures in the proposed new clause are contained in the energy White Paper and are the figures on which we shall have to report progress.
Improving energy efficiency is particularly important in achieving the absolute carbon goals and in achieving the fuel poverty targets. Therefore, that matter will be covered in considerable detail in the annual report and the related papers. The proposed new clause would constitute a new energy efficiency aim which is already an obligation on the Secretary of State under the Sustainable Energy Act. As I say, we intend to fulfil that obligation shortly in the energy efficiency implementation plan. If accepted, the proposed new clause would duplicate a requirement that already exists. Therefore, the amendment is not necessary.
5 p.m.
Baroness Byford: My Lords, the Minister mentioned that some of the points were covered in the energy White Paper. Will he not accept that what is in an energy White Paper is obviously not part of a Bill anyway? Might he slightly reconsider the answer that he has given to the noble Lord, Lord Ezra, because the two simply do not add up?
Lord Whitty: My Lords, the Sustainable Energy Act obliges the Secretary of State to report annually—that is the report that will be coming shortly—on progress towards the objectives of the White Paper. Therefore that aspect of the White Paper, as others, will be covered in that report and associated documents. We are already obliged to do that. No one is changing the
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nature of the energy White Paper's objectives, and nor are we resiling from the obligation to report just that under the Sustainable Energy Act.
Lord Ezra: My Lords, I thank the noble Baroness, Lady Miller of Hendon, for her powerful support for the amendment, and I thank the Minister for his considered response. However, I must say that the Bill provides us with an opportunity to emphasise the importance that we attach to restating the specific commitments mentioned in the energy White Paper. That White Paper has no statutory significance, and the amendment would give it statutory significance. That is all the more important in the light of the figures cited by the noble Baroness about the fact that, in the past two years, carbon emissions have actually increased.
We must restate very clearly the objective of achieving the 5 million tonnes' reduction in carbon emissions in the domestic market by 2010. The figure is actually 4 million to 6 million tonnes in the White Paper in the succeeding 10 years. I cannot see why the Government should object to that restatement, to which they have repeatedly committed themselves. I would therefore like to test the opinion of the House.
5.2 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 141; Not-Contents, 116.

Division No. 1

CONTENTS

Addington, L.

Elton, L.

Alton of Liverpool, L.

Ezra, L.

Arran, E.

Fearn, L.

Attlee, E.

Ferrers, E.

Barker, B.

Flather, B.

Beaumont of Whitley, L.

Fookes, B.

Blaker, L.

Forsyth of Drumlean, L.

Bowness, L.

Gardner of Parkes, B.

Bridgeman, V.

Garel-Jones, L.

Brougham and Vaux, L.

Geddes, L.

Byford, B.

Glenarthur, L.

Campbell of Alloway, L.

Goodhart, L.

Carlisle of Bucklow, L.

Goschen, V.

Carnegy of Lour, B.

Gray of Contin, L.

Chalker of Wallasey, B.

Harris of Richmond, B.

Clement-Jones, L.

Henley, L.

Colville of Culross, V.

Higgins, L.

Colwyn, L.

Holme of Cheltenham, L.

Cope of Berkeley, L.

Hooper, B.

Courtown, E.

Hooson, L.

Crathorne, L.

Howe, E.

Crickhowell, L.

Howe of Aberavon, L.

Cumberlege, B.

Howe of Idlicote, B.

Dahrendorf, L.

Hunt of Wirral, L.

Dean of Harptree, L.

James of Holland Park, B.

Deedes, L.

Jopling, L.

Denham, L.

Kimball, L.

Dholakia, L.

King of Bridgwater, L.

Dixon-Smith, L.

Kingsland, L.

Dundee, E.

Knight of Collingtree, B.

Eden of Winton, L.

Lawson of Blaby, L.

Elis-Thomas, L.

Lester of Herne Hill, L.

Elles, B.

Liverpool, E.

187

Lucas, L.

Rodgers of Quarry Bank, L.

Lyell, L.

Roper, L. [Teller]

McColl of Dulwich, L.

Rotherwick, L.

MacGregor of Pulham Market, L.

Russell, E.

Russell-Johnston, L.

Mackay of Clashfern, L.

Saltoun of Abernethy, Ly.

Mackie of Benshie, L.

Sandberg, L.

MacLaurin of Knebworth, L.

Sandwich, E.

Maddock, B.

Scott of Needham Market, B.

Mar and Kellie, E. [Teller]

Seccombe, B.

Marlesford, L.

Selborne, E.

Masham of Ilton, B.

Selsdon, L.

Methuen, L.

Sharp of Guildford, B.

Miller of Hendon, B.

Sharples, B.

Monro of Langholm, L.

Shaw of Northstead, L.

Montrose, D.

Sheppard of Didgemere, L.

Mowbray and Stourton, L.

Shutt of Greetland, L.

Murton of Lindisfarne, L.

Stern, B.

Naseby, L.

Stewartby, L.

Newby, L.

Stoddart of Swindon, L.

Noakes, B.

Strange, B.

Northover, B.

Taverne, L.

Oakeshott of Seagrove Bay, L.

Thomas of Gresford, L.

O'Cathain, B.

Thomas of Gwydir, L.

Onslow, E.

Thomas of Walliswood, B.

Palmer, L.

Thomson of Monifieth, L.

Park of Monmouth, B.

Tordoff, L.

Peel, E.

Trumpington, B.

Perry of Southwark, B.

Vinson, L.

Peyton of Yeovil, L.

Waddington, L.

Pilkington of Oxenford, L.

Wade of Chorlton, L.

Plumb, L.

Wakeham, L.

Plummer of St. Marylebone, L.

Wallace of Saltaire, L.

Reay, L.

Walmsley, B.

Rees, L.

Walpole, L.

Renton, L.

Wilcox, B.

Renton of Mount Harry, L.

Williamson of Horton, L.

Roberts of Conwy, L.

Windlesham, L.

NOT-CONTENTS

Acton, L.

Eatwell, L.

Ahmed, L.

Elder, L.

Alli, L.

Evans of Parkside, L.

Amos, B. (The Lord President of the Council.)

Evans of Temple Guiting, L.

Falconer of Thoroton, L. (Lord Chancellor)

Andrews, B.

Ashton of Upholland, B.

Farrington of Ribbleton, B.

Bach, L.

Faulkner of Worcester, L.

Barnett, L.

Fyfe of Fairfield, L.

Bassam of Brighton, L.

Gale, B.

Berkeley, L.

Gavron, L.

Billingham, B.

Gibson of Market Rasen, B.

Blackstone, B.

Golding, B.

Blood, B.

Goldsmith, L.

Boothroyd, B.

Gordon of Strathblane, L.

Borrie, L.

Goudie, B.

Boston of Faversham, L.

Gould of Potternewton, B.

Bragg, L.

Graham of Edmonton, L.

Brooke of Alverthorpe, L.

Gregson, L.

Brookman, L.

Grocott, L. [Teller]

Brooks of Tremorfa, L.

Harrison, L.

Carter, L.

Haskel, L.

Christopher, L.

Hilton of Eggardon, B.

Clark of Windermere, L.

Hogg of Cumbernauld, L.

Clarke of Hampstead, L.

Howie of Troon, L.

Clinton-Davis, L.

Hoyle, L.

Craig of Radley, L.

Hughes of Woodside, L.

Crawley, B.

Hunt of Chesterton, L.

David, B.

Hunt of Kings Heath, L.

Davies of Coity, L.

Irvine of Lairg, L.

Davies of Oldham, L. [Teller]

Jay of Paddington, B.

Dean of Thornton-le-Fylde, B.

Jones, L.

Desai, L.

Judd, L.

Dixon, L.

King of West Bromwich, L.

Donoughue, L.

Kirkhill, L.

188

Laming, L.

Randall of St. Budeaux. L.

Layard, L.

Rea, L.

Lea of Crondall, L.

Rendell of Babergh, B.

Lipsey, L.

Rogan, L.

Lockwood, B.

Sainsbury of Turville, L.

Lofthouse of Pontefract, L.

Scotland of Asthal, B.

McCarthy, L.

Sheldon, L.

Macdonald of Tradeston, L.

Sheppard of Liverpool, L.

McIntosh of Haringey, L.

Simon, V.

MacKenzie of Culkein, L.

Smith of Gilmorehill. B.

Mason of Barnsley, L.

Smith of Leigh, L.

Massey of Darwen, B.

Stone of Blackheath, L.

Merlyn-Rees, L.

Symons of Vernham Dean, B.

Mitchell, L.

Taylor of Blackburn, L.

Morris of Manchester, L.

Triesman, L.

Patel of Blackburn, L.

Turnberg, L.

Paul, L.

Turner of Camden, B.

Pendry, L.

Warner, L.

Peston, L.

Warwick of Undercliffe, B.

Pitkeathley, B.

Weatherill, L.

Ponsonby of Shulbrede, L.

Whitaker, B.

Prys-Davies, L.

Whitty, L.

Puttnam, L.

Williams of Elvel, L.

Ramsay of Cartvale, B.

Woolmer of Leeds, L.

Resolved in the affirmative, and amendment agreed to accordingly.
5.12 p.m.
Clause 4 [Constitution of NDA]:
Lord Whitty Lord Whitty moved Amendment No. 2
Page 3, line 30, at end insert—
"() Subsection (5) may be satisfied by consultation that took place wholly or partly before the commencement of this section."
The noble Lord said: My Lords, in moving Amendment No. 2 I shall also speak to Amendment No. 30. These amendments are designed to smooth the creation of the NDA. All sides of the House have in principle supported the establishment of the NDA. Nuclear clean up is important and pressing and we want the NDA to get on with the job as fast as possible.
While there are certain advantages in introducing a Bill in the House of Lords, there are some disadvantages. One of them, as the noble Lord, Lord Jenkin, has said, relates to the rules on the commitment of public resources in advance of Second Reading in another place. When a Bill starts here there are certain constraints which have a knock-on effect. It has meant that appointments to the NDA Board cannot be made as soon after Royal Assent as we had originally intended. That will have a knock-on effect on the appointment of the chief executive, who, under Clause 4(3), is to be appointed by the non-executive members. Our target date for the NDA to take on its responsibilities for nuclear clean-up is 1 April next year. It is a challenging, but achievable, target. There is much to do if the NDA is to be set up and provided with the necessary infrastructure so that it is able to prepare and secure approval for its first annual plan in time to start on 1 April.
In the light of that, it is essential that work on establishing the NDA can start as soon as possible after Royal Assent. The chief executive will have a key role in driving the startup work that is necessary for the NDA to function. Decisions on people, buildings, IT systems and support services are all needed before the NDA can begin its

189
preparatory work. But, as the Bill is currently drafted, the NDA could not start operating until four members are appointed. That would push the appointment of a chief executive until well into the autumn of this year and would slow down the development of a fully functional NDA.
We propose to change the transitional arrangements for the creation of the NDA so that it is established on the appointment of the chairman and for that person to be joined swiftly by the chief executive officer. That will enable the practical work on creating the NDA to start, as we had originally envisaged, soon after Royal Assent which, final approval of the Bill permitting, should mean that we do not lose precious weeks in August and September.
The amendments also put in place arrangements to reflect our determination to ensure the non-executive control that the Bill requires for the NDA board to go forward. During that initial period, the chairman's approval is required for any decision taken by the chief executive until there are sufficient non-executive members to meet the quorum test, as set out in paragraph 9 of Schedule 1.
The initial period would come to an end when the NDA board reached its required minimum complement of seven members, or at the discretion of the Secretary of State. That option is provided so that any unexpected delay in the appointment of the chief executive does not itself become a block to establishing the NDA through the appointment of non-executives. Amendment No. 2 specifically provides for Scottish Ministers to be consulted on the appointments during the transitional period and before Clause 4 on the constitution of the NDA comes into force.
The Government intend to appoint the chairman and then chief executive as soon after Royal Assent as possible—hopefully in late July or early August this year. Non-executive appointments could realistically follow around September, following a recruitment process begun after Second Reading in another place. That explains the timetable.
These amendments seek to facilitate the early development of a functioning NDA in the period after Royal Assent. I stress that, because a previous debate here and a question to my noble friend Lord Triesman from the noble Lord, Lord Jenkin, dealt with appointments procedures prior to Royal Assent. The Department of Trade and Industry has taken steps to recruit a chairman and chief executive officer designate as senior policy advisers in advance of Second Reading in another place. These provisions do not relate to that. Nothing that is in the Bill can affect the situation prior to Royal Assent. The advertisements for those posts make it clear that the appointments would not be confirmed as chief executive and chair unless the Bill was passed.
The two debates need to be separated. These provisions should allow us to have a relatively speedy and smooth transition to the establishment of the NDA—which would not happen under the Bill as currently drafted. I beg to move.
Baroness Carnegy of Lour: My Lords, I have a short question in relation to the amendment. Does it still mean that, in spite of the wording, there will be
190
consultation over the specific individuals who will be appointed, not just over the general idea of the type of people who will be required'? It is important that those people are acceptable north of the Border, because the role of the NDA impacts so much on devolved matters, such as planning, roads, health and so on.
Also, is there a precedent for the sort of arrangements that are outlined in Amendment No. 30? Have there been similar interim arrangements on the face of any previous Bill?
Lord Dixon-Smith: My Lords, I wish to raise a small point. Is the Government's hope to have the provisional agency in place so quickly somewhat over-ambitious? It seems to me that anyone who is likely to be suitable to be, first, the Government's adviser, then, in effect, chairman designate and then chairman, must already be in employment. If he is not on three months' notice, then he is probably not doing a job that would make him suitable for a post of this significance. The same would apply to a chief executive appointment, which cannot be made until after the chairman is in post to appoint him. That seems to me to indicate at least a six-month timetable from Royal Assent. That is when the Minister appeared to indicate that the process would seriously get going. I believe that the Government would be wiser to look at the end of the year rather than at September.
Baroness Miller of Hendon: My Lords, I thank the Minister for writing to me prior to today to explain his amendments in detail. I also thank his team for giving a week's notice of their tabling. I thought it appropriate to say that in view of the complaints I made when amendments were tabled only on the previous day. We are not always critical; sometimes we are most appreciative.
We also appreciate the Government's comment that they want to get on with setting up the N DA during the passage of the Bill. Unlike suggestions made in an article in the Financial Times, delaying the Bill's implementation is most certainly not the intention of these Benches. We merely want to do our job properly and carefully and to scrutinise the details of the Bill before it reaches the other place where, unfortunately, Members will not have the time to do so to the extent that we do in this House.
We therefore welcome Amendment No. 2 with the proviso that the Minister will be able to give a satisfactory, comforting answer to my noble friends Lady Carnegy and Lord Dixon-Smith. However, as I have spoken to the Minister previously, he will know that there were reasons why we were glad that he did not move the amendment on Report. Certain matters about which my noble friend Lord Jenkin was particularly concerned had not been sorted out to our satisfaction.
Noble Lords might remember that in Committee, my noble friend Lord Jenkin said a little about the advertisement that the DTI had placed for a policy adviser who would then de facto become the chairman of the NDA. It was noted that the DTI wished to

191
appoint a policy adviser to advise on the preparations required for the establishment of the NDA who would be appointed as a non-executive chairman.
Our concern was that this advert not only missed out on possible applicants for the chairman's post by dressing it up as a policy adviser, but we also believed that it may well have broken Treasury rules—the Minister mentioned those—that money should not be allocated for use in conjunction with the Bill until it has received a Second Reading in the other place.
The Minister will also know that my noble friend Lord Jenkin pursued the matter with both the Public Accounts Committee and the Commissioner for Public Appointments. Regrettably, we are not today in a position to give a definitive answer on either of the two matters. With regard to the Commissioner for Public Appointments, the gentleman dealing with the matter has not been in his office for a few days. Furthermore, he is not answering his mobile phone, so it may well be that he is on holiday.
With regard to the Public Accounts Committee, we may well receive an answer during the course of the afternoon. As I mentioned to the Minister, we were able to see a draft reply, which had not been seen by the chairman, simply indicating that the letter of the rules,
"may be said to be followed".
However, whether the spirit of them has been followed is much more debatable.
We do not want to delay matters. I am sure that in a moment the Minister will answer my two noble friends. I shall accept what he has said and the fact that our two problems do not present a reason for rejecting the amendment. They do not interfere with it. I hope that my noble friend Lord Jenkin will be satisfied by what I have done on his behalf, but it is clear that if the position is not correct we will be able to make a protest later. What I have said will be reported in Hansard today.
Lord Whitty: My Lords, in answer to the noble Baroness, Lady Carnegy, consultation would be on individuals under the normal rules and consultation with Scotland would be appropriately covered. However, I am not sure that I can draw an exact precedent and I shall write to the noble Baroness. Of course, in setting up new bodies, ways of moving to their full establishment via transitional arrangements have been adopted in various Acts of Parliament, including the way in which we appoint chief executives prior to the full board being operational. Although it may not be precisely the same as the case here, I am sure that there are broadly similar precedents. I shall draw those to her attention.
In relation to the point made by the noble Lord, Lord Dixon-Smith, it may be true that our ambitious target in making the appointment of the chairman and chief executive presents a tight and challenging time-scale. Some people who might be the most appropriate candidates may not be appointable within that time, in which case the timetable might slip a little. But that is all the more reason for starting the process as early as
192
possible. That is why we want to include these provisions. Even if we lose a week or two during the summer, the most appropriate candidate can be appointed as soon as possible.
I am grateful for the acceptance of the noble Baroness, Lady Miller, that the provisions are helpful and different from the issues raised by the noble Lord, Lord Jenkin, in Committee and on Report and in his correspondence with the Commissioner and the chair of the Public Accounts Committee. The correspondence will go back to the noble Lord, Lord Jenkin, and may affect that situation. However, that relates to appointments prior to Royal Assent and these proposed amendments do not affect that position one way or the other. Clearly, we would need to take note of anything the chair of the Public Accounts Committee or the Commissioner said about the procedure, but the amendments do not affect it. They affect the procedure post Royal Assent and I commend them to the House.
On Question, amendment agreed to.
5.30 p.m.
Clause 5 [Designated responsibilities]:
Lord Peyton of Yeovil Lord Peyton of Yeovil moved Amendment No. 3:
Page 4, line 15, at end insert "; and
(g) the Commissioning, planning and developing of nuclear power stations."
The noble Lord said: My Lords, I tabled the amendment partly as a hopeful nudge in moving the Government in a sensible direction and partly as a continuing protest against their lack of an energy policy, which is characterised by their White Paper and by this Bill. It is a feature of that policy that hopes are taken as facts and aspirations as achievements. As even Ministers should appreciate, there is a difference between the two. The Government have ill-founded confidence in what they have said. That confidence tends to blot out any apprehension that they may have got things wrong.
With North Sea oil diminishing, the Government are apparently content on dependence for three-quarters of the raw material needed for a generation from overseas sources a long way away through a pipeline that has not been built. It seems that scant attention has been paid to the inconvenience—I put it no higher than that—of being at the end of a line. This country's needs will necessarily come last, not only in the minds of producers but in the minds of all the consumers on the way.
The Government seem to have made the almost endemic error of disregarding the possibility—perhaps I should have said "probability"—of the cost being seriously underestimated. I think that they have also disregarded the possible, or certain, interruptions that will result from disputes, accidents and terrorist activities. I find it very odd that the Government are consumed with the notion of terror and the activities of terrorists in many contexts but not at all in this one.
The second limb of the Government's energy policy is their entertainment of high hopes in relation to renewables. They seem altogether to have overlooked the fact that wind

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is rather an irregular affair and that it will not be amenable to control by them. They seem to be blissfully confident that, because they come from natural sources, renewables will not cost too much. However, I believe I am right in saying that recent studies suggest that they have that wrong and that, in fact, it may be a very expensive business to bring electric power from the windmills which they are to erect. I believe that the Government have also neglected to recognise the increasing hostility to their proposals. People in the countryside, in particular, will come to dislike the prospect of their whole environment being populated by these awful windmills.
I do not propose to elaborate at length on all the arguments which were repeated endlessly by very skilled people during the Committee stage of the Bill. Personally, I am very sorry—I never lose an opportunity to say this—that the Committee stage was banished to the appalling, toothless procedure in the Moses Room with no Divisions and no teeth at all but just an endless mass of talk with those involved getting nowhere.
In the circumstances, I think it is amazing that we should be going in a reverse direction to that followed by almost every other country. In my view, in turning away from nuclear, which has provided a reliable base load over many years and creates no emissions, the Government are making a cardinal error. It has been pointed out by the noble Lord, Lord Ezra, today and by many others throughout these debates that there are no emissions from nuclear power stations and therefore they lend a degree of much-needed credibility to the Government's Kyoto commitments.
Perhaps the Government will cast their minds back to 1973 when the French realised that it was dangerous to rely to any very large extent on imported supplies. Rather than continue a dependence on Middle East oil, the French showed themselves to be decisive and determined. They then went nuclear in a big way. People talk about the long time taken to move into nuclear, but I think that the example of the French is forgotten. With a real will, in 12 years the French achieved 61 per cent nuclear generation, and that proportion has now risen to three-quarters.
I appreciate that the Minister must be extremely pleased that this is the last chapter of debates, which have gone on almost endlessly. He must be bored to tears with repetition and he must feel like giving me a fairly chilly welcome today when I verge on repetition myself. I do not intend to go on for long but, having paid the noble Lord's patience—and, if I may say so, his good manners—a tribute, I want to say that his speech at Second Reading disappointed me profoundly. It had all the sound and atmosphere of a funeral oration, saying goodbye to our nuclear capacity.
Of course, I accept that from time to time the Government come out with the glib saying that they are "keeping the nuclear option open", but I think that they use that as a means of protecting themselves against a charge of blind and pig-headed complacency. I hope that the Minister will correct me if I am in any way wrong here, but—this is very sad—the Government seem to be totally silent on what they are doing to keep the nuclear
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option open. I should be very interested to know what thoughts they have on modern types of reactor. I should like to know what time or money they are spending on research into waste handling, which they rightly regard as a very serious problem. A third question is: to what extent are they concerned with the almost certain loss, if we continue in this way, of very valuable skills?
At this stage, I cannot resist the temptation to quote the noble Lord's words, which, by now, I think have become quite familiar. He said:
"One reason why the Government are not disposed to maintain a significant nuclear component over the long term is precisely because we have not worked out how to deal with long-term waste and do not have public confidence in our ability to do so" — [Official Report, 15/1/04; col. GC 164.]
I hope that the noble Lord will at least be moved to produce some kind of palliative comment to remove the rather depressing impression that those words gave, honest as they were.
In my view, it is no answer to say that an amendment such as this will not fit into the Bill. I have no particular regard for the Bill and, if the amendment made a hit of a mess of it, that would not bother me overmuch; nor would I be bothered too much by the argument that the Nuclear Decommissioning Authority should not be given a duty which would involve it in making a mess when its primary duty will be clearing up a mess which has already been made. That is a two-edged argument. People who are familiar with the messes might be the best ones to limit the mess in the first place, as well as clearing it up afterwards. I just say that I am not particularly impressed by that argument.
I go back, not particularly interestingly, into my own past. A very long time ago I was a junior Minister in what was then called the Ministry of Power. I regret that there is now no single department responsible for the very important matter of energy. I was rather confused that it should be shared between the two departments of the DTI and Defra. What bothers me is that this crucial subject is being lost sight of and is in danger of almost being forgotten in what I would describe as the "visionless sprawl of the Department of Trade and Industry". I have begun to suspect that the right honourable lady who presides over that ghastly heap has bidden her myrmidons under no circumstances to mention the word "nuclear" in her hearing—at least until after the general election, when it is possible that the facts may render the subject decent enough to be mentioned.
I end simply by saying that I recognise that for the Government to say now that they will take a serious look at nuclear would involve another U-turn. However, such a U-turn would be most particularly welcomed and they would be congratulated—I would certainly be the first to do so—on their enlightenment. However, I suspect that that is too much to hope for.
I make it quite clear that if by any chance I were to be successful in nudging the Government towards accepting the need for nuclear—and saying so now—I should be very pleased that I had made some progress with the amendment. But, if they do not, I shall wish to divide the House, even at the risk of defacing the beauty of the Bill. I beg to move.
5.45 p.m.
Lord Gray of Contin: My Lords, I rise to support the amendment moved with such skill by my noble friend Lord Peyton of Yeovil, who has been blessed with the gift of combining wisdom, wit and brevity in equal measure; something that is not always available in this House.
It is a matter of very great disappointment to those of us on both sides of the House who support the nuclear industry that the White Paper, on which so much of this Bill is based, makes no more than token mention of nuclear power. To say that the future of nuclear power will not be ruled out is poor reward for an industry that presently provides approximately 25 per cent of our power generation, and which can justifiably claim to be among the cleanest of all generation methods.
A wonderful opportunity has been missed to make a positive commitment to replace the nuclear power stations, which will be decommissioned over the next few years, with a proper new nuclear programme. While many other parts of the world are seizing the challenge, our Government, I am afraid, are fumbling and floundering and making unrealistic demands on the renewable energy industry, which is still in its infancy.
Why is it that countries as far apart as China and Finland, and with needs as different as those of India and Eastern Europe, have been able to overcome the problems of waste disposal and to proceed with the construction of new reactors? My noble friend Lord Peyton made reference to that. I too wonder what the Government are doing in the way of research because building a nuclear reactor today is a very different exercise from 30 years ago. Things have moved on tremendously. I suggest that one of the first things that the Government should do is to set up a working group to study the types of reactors which are being used and are being built satisfactorily in other parts of the world. After all, most countries with nuclear reactors started off having reservations about them, but they have won the battle and are now building; before long they will leave us standing still.
There are now more than 400 nuclear reactors in operation with a substantial number under construction or on drawing boards. A report by the Institution of Civil Engineers entitled State of the Nation 2003 predicted,
"that by the year 2020 90 per cent of the gas needed to fuel British power stations would be imported".
Ironically, that is also the year in which our last remaining nuclear power station will be decommissioned—that is, unless we come to our senses and rejuvenate our nuclear industry. Only 16 years ahead is not long when one takes into account the lead-in time for the building of a nuclear reactor. Many of us may not be around to experience the folly of our present policy, but we shall not be forgiven by our successors.
We suffer from having had a wealth of riches in the energy field for so long—coal, oil, gas and hydro. The first three will soon be depleted altogether, and the gap they will leave behind is far beyond the capability of renewables alone.
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We should look across the Channel to France, as my noble friend pointed out. The benefit of its development of nuclear power is now there for everyone to see. Time has been on our side, but we are fast squandering it.
So, for those and many other reasons, I strongly support my noble friend's amendment. In doing so, I must emphasise that the amendment in no way condemns or criticises other forms of power generation. They will all be needed but none more so than nuclear power.
Lord Monro of Langholm: My Lords, I should like to add a word or two in support of my noble friends Lord Peyton and Lord Gray, who, between them, have put a very powerful case for continuing nuclear development. I have lived within two miles of Chapelcross Magnox Power Station all its life. One can see the huge disappointment among its 400 highly skilled workforce that it is to be decommissioned. Everything is logical in this world. As my noble friend Lord Gray has indicated, power stations will be needed by the year 2020. Surely, it would be sensible to keep these licensed nuclear sites ready and prepared for the next generation. As my noble friend said, to build a modern nuclear power station is much easier than it was in the 1950s and 1960s.
So, I believe that for that reason, and knowing that we will be short of power by 2020, it is foolish to go into reverse and to sit on the fence, as the Government are currently doing.
My second point is that the Government grossly overestimate the progress that will be made with wind power. I have sheaves of correspondence and newspaper cuttings demonstrating mounting opposition to wind farms, some of them 400 feet high and with transmission lines running through much beautiful countryside. The population will not stand for the spoilage of much of our attractive countryside by those ghastly wind farms and transmission lines.
I have another interesting cutting about Eskdalemuir Observatory, of which your Lordships have probably heard as the coldest and wettest place in Scotland. It is a seismographic observatory and it states that it does not want a wind farm within 50 miles, because it would upset its instruments. If we take out that area of the south of Scotland, that will remove an awful lot of projected wind farms immediately.
So the Government want to think again about their reliance on wind farms to provide the power that we have lost through nuclear energy. When they have thought about it, they will realise that it would be foolhardy to throw away the immense expertise that we have in the design and operation of nuclear power just because the Government do not like nuclear power.
Lord Tomlinson: My Lords, I would not want my noble friend to feel that support for the continuation of nuclear power exists only on one side of the House. I do not propose to speak for long, but simply to make it clear to him, as I have previously, that I am not in favour of one form of energy at the expense of another. I have nothing against all the plans for renewables—I

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wish them well and hope that they succeed. But I prefer to have a guarantee available, lest the optimism with which they are viewed proves ill-founded.
One of the first responsibilities of a government towards their nation is to be able to fuel its economy. That means the provision of sufficient energy to meet the rising demands made on the system. Therefore, I support the broad view expressed by the noble Lord, Lord Peyton, that we would be foolhardy indeed to get rid of any existing form of supply of energy unless and until we have guaranteed certainty of the alternatives. I do not propose to join the noble Lord, Lord Peyton, in the Division Lobby tonight, because that is not where the issue will be determined. The issue will be determined by having a clear and frank discussion on the future supply of energy.
I am not sure that this is the appropriate place at which we can sort that out for all time. The noble Lord's amendment does nothing other than to send a clear signal to the Government about what needs to be done. There will be differences about the alternatives. I would not want to join in anything that appeared to be an attack on renewables, but I sound the warning to my noble friend that, when it comes to the guaranteed supply of energy, in my opinion, nuclear will continue to have a role until we have a proven and guaranteed alternative.
Lord Jopling: My Lords, unlike the noble Lord, Lord Tomlinson, I shall be happy to join my noble friend Lord Peyton in the Lobby later because I agree with everything that he said, as well as with the comments of my noble friends Lord Gray and Lord Monro. I rise for only one purpose: to say how distressed I am at the Government's attitude to the whole matter of nuclear energy.
Their approach is totally flabby, compared with what I remember of a previous Labour government many years ago. One of the bravest speeches that I ever heard in my life was in another place, when the late, lamented Lord Shore of Stepney, whom many of us miss very much in this House, made a speech proposing the establishment of the nuclear reprocessing plant at Sellaficld. There was a great deal of opposition from his own party to that, but the government of the day took a brave and strong line, realising that something had to be done because the future—or part of the future—for energy resources lay in the nuclear option.
Now we have a Government who appear to be hoping that the whole problem of energy resources will go away and that, when the decision finally has to be taken, as it will because it is inevitable, they will not be in office and will be able to sit and shout and oppose it. It is a sad reflection on the bravery of a previous Labour government that this Government are so utterly flabby in their approach.
Lord Lea of Crondall: My Lords, those of us who are convinced of the need to move fast on some new nuclear commissioning can take some comfort from the fact that during the course of this long process of discussion of the Bill in Committee, on Report and, now, on Third Reading, what one might call the
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intellectual case has gone from strength to strength despite all the arguments advanced against the proposition that we need to move quickly to consider commissioning new stations.
The Government, having produced a White Paper only a year ago, are unable—so would be any Conservative, Liberal Democrat or any other government—to signal that in the Bill, as the amendment tabled by the noble Lord, Lord Peyton, suggests. But, having talked to many people about the matter, the debate itself has been the occasion for a marked change in the public perception of our energy needs. The Kyoto factor is involved; the question of security of supply from the Middle East, Russia, Central Asia and so on is also involved. As has correctly been pointed out, an enormous number of wind turbines—15,000, I think—of 3 megawatts would be needed to replace the nuclear industry.
I am sure that all of those speeches have been well noted across government and that it cannot be too long before there is a shift of policy by the Government. Along with my noble friend Lord Tomlinson, I will not be supporting the noble Lord, Lord Peyton, in the Division Lobby, for self-evident reasons, but the debate has marked a great step forward.
Lord Ezra: My Lords, I consider the contribution made by the noble Lord, Lord Peyton, to be of great importance. He has drawn attention to what was a major gap in the energy White Paper. We must resolve what we are going to do about the nuclear option. I also listened with great care to the speech made by the noble Lord, Lord Gray of Contin. He referred to recent developments in new forms of nuclear generation and the need to assess those developments with care. We need to know whether that is being done. As I understand it, there are about four new processes either actually achieved or on the drawing board. We need to know how they stand up to existing processes and how they meet the various reservations that many people have about nuclear power generation.
My one reservation about the proposal of the noble Lord, Lord Peyton, is that it does not fit in very well with the Bill. I know that he did not regard that as a serious reason for not including it, but I should have thought that his message was clear. I hope that in his response, the noble Lord, Lord Whitty, will take it seriously and tell us what the Government are doing to assess the various possibilities that now exist that did not previously exist for generating nuclear power, alongside all the other forms of energy generation. We could therefore make use of this interesting debate to obtain a firm statement from the Government about how they propose to develop their whole approach to nuclear power.
6 p.m.
Lord Christopher: My Lords, I had no intention of speaking in this debate, mainly because every time that I do, I must declare the terrible interest that I have as having responsibility in British Nuclear Fuels. It has neither asked me to speak nor given me any brown envelopes, so I feel reasonably free to express my views.

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Broadly speaking, I support the views expressed by the noble Lord, Lord Peyton. I hope that he does not push the matter to a vote, because that would defeat his own objective. Around the House, there is a view that nuclear power must re-enter the view of government. I do not wish to repeat what other noble Lords have said today and in Committee, but the Government's approach seems to lack any objective assessment of world energy needs in 20 or 25 years' time.
Almost every day one reads in a newspaper of increasing demands across the globe. Russia is now in the enviable position of having to decide whether to build its pipeline to service Japan or to service China. My guess is that it will decide on China, because that is the best long-term bet. Pakistan has now decided that it requires another nuclear power station. Who is building it? The Chinese. We need a very objective, realistic assessment of world energy needs. I would not have thought that any government, certainly not the one that I support, would take any comfort from somebody in 10 or 20 years' time, or perhaps sooner, looking back and saying, "They may have saved us from nuclear energy, but at least they produced the blackout". There is a real risk of that happening and an even more serious risk if it applies to an increasingly competitive global industry.
The challenge for all those who support that view is not so much to decide the matter today. I certainly do not support the view that it is cowardice on the part of the Government; that is a ridiculous observation. It is a challenge to both the Opposition and ourselves to ensure, if we can, that something sensible appears in our manifestos, because there will be no change before the next election and we have about 12 months to put that right.
Lord Davies of Oldham: My Lords, I am in some difficulty in responding, for the simple reason that those who followed debates on the Bill over many hours on many days in Committee and on Report will know that we have spent hours on the issue. I have looked at the Hansard report of just one Committee sitting, when we discussed skills in the nuclear industry. My contribution at that stage was 15 minutes long—I make no apology, as it was Committee stage. The debate on just the narrow issue of how we preserve and intend to enhance nuclear skills lasted more than an hour. Yet today I am asked to respond on the whole question of the Government's nuclear energy policy.
In moving his amendment with his customary skill and charm, the noble Lord, Lord Peyton, made a Freudian slip: he could not quite recall what NDA stood for. It stands for Nuclear Decommissioning Authority, not "commissioning" or "build". We do not need legislation in order to carry out a programme of build, if that is decided upon in government policy. The Bill creates an authority to deal with clean-up. That is what we have debated for weeks on end. I fail to understand how I can respond to a proposal involving the exact opposite of what we are doing.
Lord Peyton of Yeovil: My Lords, I am much obliged to the noble Lord. Before he goes too far with the point that I have forgotten what those wretched
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initials stand for, I hope that he will allow for the effects of old age, which cause a lapse of memory every now and again. Perhaps the noble Lord will reach that state before very long.
Lord Davies of Oldham: My Lords, I assure the noble Lord that I feel that I am already at that stage, so I am at one with him on that. I sought to make the more serious point that NDA stands for Nuclear Decommissioning Authority. The Bill is about how we deal with nuclear clean-up. It is about the nuclear industry's past and the inheritance that we need to address now, as everybody recognises; hence the creation of the Nuclear Decommissioning Authority.
However, Amendment No. 3 is about the possibilities of nuclear build. I recognise the points that noble Lords who spoke in support of the amendment made on the crucial issue of nuclear power. Those speeches were well presented, and we recognise the nature of the problem. However. I ask noble Lords whether they propose that nuclear build and the solutions to the energy gap issues that they have identified should be the responsibility of the Nuclear Decommissioning Authority—that is where the amendment would appear in the Bill. It seems to make an absolute travesty of our proposals. We pride ourselves on our legislative role, the amount of time that we are prepared to devote to legislation and the care that we take. Does anybody who supports the necessity to address the nuclear question in a different timescale from the one proposed by the Government, as do noble Lords in some parts of the House, think that the Nuclear Decommissioning Authority is the agency that should do it? That is what the amendment asks noble Lords to support.
If, by some ridiculous mischance, noble Lords are tempted to go near the Lobby in support of the amendment in those terms, it cannot be the action of those who are concerned properly about our energy difficulties and the obvious necessity to meet the energy gap identified.
Lord Tomlinson: My Lords, I hope that when the Minister refers to noble Lords being tempted to go through the Lobbies, he is not talking to any of his noble friends behind him. His noble friends expressed very clear sympathy with the arguments and the view that this was not the appropriate place with which to deal with the matter. I hope that the Minister will not drive us into the arms of the noble Lord, Lord Peyton, which I never find particularly appealing—I could find much more appealing arms to get driven into—and will address perhaps the seriousness of the issue, with which the noble Lord, Lord Ezra, also dealt.
Lord Davies of Oldham: My Lords, I was not addressing my remarks to any particular part of the House. I merely sought to identify that the amendment made the odd interpretation that the Nuclear Decommissioning Authority, established in the framework of the Bill to deal with nuclear clean-up, should be the focus of nuclear build to meet an energy gap and future provision that we all recognise is of

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surpassing importance to this country. That is why we have spent many hours in Committee. Noble Lords on the Front Benches have made significant contributions to this debate. The fact that the noble Baroness, Lady Miller, has not participated today is in no way a reflection, as I understand it, of her lack of concern about the issues of energy provision in the future—very far from it. I presume that in fact she has not participated in this debate because this amendment is not an appropriate amendment to address itself to these issues.
I could reiterate the arguments that we have had in Committee and on Report over all these issues, of the research positions that we are concerned about, of the questions of the research activity in which we participate, and of the issues that we have with regard to enhancement of skills in order to preserve the position for the nuclear future. I could enter into the debate of the whole issue of nuclear pricing and the relative costs of the nuclear industry at present. I have been invited to do exactly that, it seems to me, by the very nature and breadth of this debate. But there must come a time with a Bill, particularly at Third Reading, when we address ourselves to amendments that are realistic, and that give effect reasonably to what can be achieved in the Bill.
I maintain that it is perfectly obvious that the Nuclear Decommissioning Authority is not the authority to carry the burden of the points that have been made on the general energy policy. I have no doubt that we shall return to these debates on many occasions in the future. If one thing is certain about your Lordships' House, it is that there are manifest opportunities for debates on every issue, and I have no doubt that energy will feature over the course of the next few months and years.
I am merely making the point today that this amendment is grotesquely misplaced in asking the Nuclear Decommissioning Authority to be responsible for nuclear build. It is on those grounds that I hope that the noble Lord will recognise that he has had a good debate, and he has made his case about nuclear issues, but it would not be right to ask noble Lords to participate in the Lobbies on an amendment that is so ill-construed.
Baroness Byford: My Lords, before the noble Lord sits down, and before my noble friend comes back, I say to the Minister that he has slightly misjudged the occasion. The problem that we have had with this Bill throughout is that it is not a Bill about energy. The very issues that have been raised this afternoon can be addressed nowhere in the Bill, but we should be addressing them.
Later on—I suspect by then many noble Lords will no longer be in the Chamber—I will again attempt to get something to cover the issue of protecting the environment, while allowing development to take place on wind farms. Again, I shall be told that it is not relevant, and it is not appropriate. But this Bill is a wasted opportunity. This Government have wasted it. No wonder my noble friend is valiantly trying to raise an issue that is of great concern to all Members.
The noble Lord is well aware that we on the Front Bench —although I am sitting behind my noble friend on this occasion, I do not know if I feel freer or not; I do not
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think that I feel anything about it—feel that he has misjudged it. I found his response very disappointing —offensive is too strong a word.
Lord Davies of Oldham: My Lords, the noble Baroness did catch me before I sat down, so I will respond. I regret that she thinks that my remarks were ill-judged to the occasion. I merely emphasised the obvious fact that we have been through all these issues. We have had debates at Second Reading, and we had endless debates in Committee. I just indicated one brief illustration of how lengthy our debates were in Committee. Noble Lords will recall that we had 13 days in Committee. We have had days on Report, and the issues have been articulated and aired there.
There has not been a point that has been made today—though they have all been made effectively and ably by noble Lords—that has not been articulated in the context of the Bill prior to today. It is not my role at this point to respond to a general debate. This is not Second Reading; this is an amendment to a Bill asking the Nuclear Decommissioning Authority to be responsible, as I see it, for commissioning nuclear build—the exact opposite to the whole proposition of what the Bill stands for. It is on that basis that I hope that the noble Lord will recognise that he has had a fair run. Perhaps he will recognise that he could at this stage usefully withdraw his amendment.
6.15 p.m.
Lord Peyton of Yeovil: My Lords, if the noble Lord had taken that sort of note earlier on, he might well have persuaded me. I am afraid that he has not. I am very grateful to everyone, to all noble Lords except one, for taking part in this debate. My noble friends on this side of the House will, I am sure, forgive me, if I say that I am particularly grateful to the three noble Lords who took part from the other side of the House.
I have always thought that it is particularly important in your Lordships' House that there should be some echo and some common ground between the parties. I am grateful to the three noble Lords who supported what I said, even though they do not accept my view that protests are usually louder if they are also expressed in the Lobbies. I am sure that our difference in that matter will not affect our relationship.
I am conscious that since my noble friend on the Front Bench has been unhappily silent, it occurs to me that there might be a possibility of her being under some constraints that do not affect me at all. I will not specify them, but only the direction is sufficient for me.
I should like to finish by saying that what the noble Lords, Lord Christopher, Lord Lea and Lord Tomlinson, said to me was an effective plea, which I hope they will believe really did shift me. On the other hand, the speech of their noble friend the Minister, which was really more of a lecture and a homily, telling me rather sharply that I had made a bad mistake in intruding on the niceties of his Bill, put me back sharply to where I was before. To say no more, I should like to take the opinion of the House.
6.18 p.m.
On Question, Whether the said amendment (No. 3) shall be agreed to?
Their Lordships divided: Contents, 64; Not-Contents, 121.

Division No. 2

CONTENTS

Blaker, L.

Marlesford, L.

Carlisle of Bucklow, L.

Mayhew of Twysden, L.

Carnegy of Lour, B.

Monro of Langholm, L.

Chalker of Wallasey, B.

Mowbray and Stourton, L.

Colwyn, L.

Murton of Lindisfarne, L.

Cumberlege, B.

Naseby, L.

Deedes, L.

Newton of Braintree, L.

Denham, L.

Northbrook, L.

Dundee, E.

O'Cathain, B.

Eden of Winton, L.

Palmer, L.

Elles, B.

Park of Monmouth, B.

Elton, L.

Patten, L.

Ferrers, E.

Peel, E.

Fookes, B.

Perry of Southwark, B.

Gardner of Parkes, B.

Peyton of Yeovil, L. [Teller]

Geddes, L.

Pilkington of Oxenford, L.

Goschen, V.

Reay, L.

Gray of Contin, L. [Teller]

Rees, L

Renton, L

Greenway, L.

St John of Fawsley, L.

Harris of Peckham, L.

Selsdon, L.

Jopling, L.

Sharples, B.

Kimball, L.

Shaw of Northstead, L.

King of Bridgwater, L.

Simon of Glaisdale, L.

Knight of Collingtree, B.

Stewartby, L.

Lamont of Lerwick, L.

Thomas of Gwydir, L.

Lawson of Blaby, L.

Ullswater, V.

Liverpool, E.

Vinson, L.

Lyell, L.

Waddington, L.

McColl of Dulwich, L.

Wakeham, L.

MacGregor of Pulham Market, L

Walker of Worcester, L.

Walpole, L.

Mancroft, L.

Wilcox, B.

NOT-CO NTENTS

Acton, L.

David, B.

Ahmed, L.

Davies of Coity, L.

Alli, L.

Davies of Oldham, L.

Amos, B. (The Lord President of the Council.)

Dean of Thornton-le-Fylde, B.

Desai, L.

Andrews, B.

Dixon, L.

Ashton of Upholland, B.

Donoughue, L.

Bach, L.

Eatwell, L.

Bassam of Brighton, L.

Elder, L.

Billingham, B.

Elis-Thomas, L.

Blackstone, B.

Erroll, E.

Blood, B.

Evans of Parkside, L.

Boothroyd, B.

Evans of Temple Guiting, L.

Borrie, L.

Falconer of Thoroton, L. (Lord Chancellor)

Boston of Faversham, L.

Brooke of Alverthorpe, L.

Farrington of Ribbleton, B.

Brookman, L.

Faulkner of Worcester, L.

Brooks of Tremorfa, L.

Filkin, L.

Burlison, L.

Finlay of Llandaff, B.

Carter, L.

Freyberg, L.

Chan, L.

Fyfe of Fairfield, L.

Chandos, V.

Gale, B.

Christopher, L.

Gavron, L.

Clark of Windermere, L.

Gibson of Market Rasen, B.

Clarke of Hampstead, L.

Gilbert, L.

Clinton-Davis, L.

Golding, B.

Cohen of Pimlico, B.

Goldsmith, L.

Crawley, B.

Gordon of Strathblane, L.

204

Goudie, B.

Mitchell, L.

Gould of Potternewton, B.

Morgan of Huyton, B.

Graham of Edmonton, L.

Patel of Blackburn, L.

Grenfell, L.

Pendry, L.

Grocott, L. [Teller]

Pitkeathley, B.

Harris of Haringey, L.

Puttnam, L.

Harrison, L.

Ramsay of Cartvale, B.

Haskel, L.

Rea, L.

Hilton of Eggardon, B.

Rendell of Babergh, B.

Hogg of Cumbernauld, L.

Richard, L.

Howie of Troon, L.

Robertson of Port Ellen, L.

Hoyle, L.

Rooker, L.

Hughes of Woodside, L.

Sainsbury of Turville, L.

Hunt of Kings Heath, L.

St.John of Bletso, L.

Irvine of Lairg, L.

Scotland of Asthal, B.

Janner of Braunstone, L.

Sheldon, L.

Jay of Paddington, B.

Sheppard of Liverpool, L.

Jones, L.

Simon, V.

Judd, L.

Smith of Gilmorehill, B.

King of West Bromwich, L.

Kirkhill, L.

Smith of Leigh, L.

Laming, L.

Stone of Blackheath, L.

Layard, L.

Symons of Vernham Dean, B.

Lea of Crondall, L.

Taylor of Blackburn, L.

Lipsey, L.

Tomlinson, L.

Lockwood, B.

Triesman, L. [Teller]

Lofthouse of Pontefract, L.

Turnberg, L.

McCarthy, L.

Warner, L.

McIntosh of Haringey, L.

Warwick of Undercliffe, B.

McIntosh of Hudnall, B.

Whitaker, B.

MacKenzie of Culkein, L.

Whitty, L.

Mason of Barnsley, L.

Wilkins, B.

Massey of Darwen, B.

Williamson of Horton, L.

Merlyn-Rees, L.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

6.30 p.m.
Clause 11 [General duties when carrying out functions]:
Lord Jopling Lord Jopling moved Amendment No. 4:
Page 9, line 23, at end insert ", including the desirability of optimising, through its employment arrangements and other NDA contracts, the social and economic life of the community and, during the period that it has responsibility under a direction under section 5 for securing the operation or Decommissioning of any installation, of maintaining or enhancing so far as practicable the levels of support to that life that were made by the operator of the installation prior to the direction being made"
The noble Lord said: My Lords, I understand that we are debating Amendment No. 4 and Amendment No. 6. The two amendments are tabled in my name and in that of the noble Lord, Lord Campbell-Savours. I should tell noble Lords that the noble Lord, Lord Campbell-Savours, to whom I spoke this morning, fully supports the amendments but is not with us because he has to attend to a serious family crisis. I am sure that the House sends good wishes to him and to his family.
During the progress of this Bill, we have heard noble Lords speak from various parts of the House about the serious impact of plant closure and Decommissioning on the social and economic well-being of local communities. I speak with particular feeling on this, having been for many years a Member in another place for a Cumbrian constituency close to Sellafield.
Assurances have been sought that affected communities will receive the necessary support to restructure their economies and on the extent to which

205
the Nuclear Decommissioning Authority has a role in providing support to benefit the social and economic life of those affected areas. I remind noble Lords that Clause 9(1)(e) gives the NDA the function of,
"giving encouragement and other support to activities that benefit the social and economic life of communities living near designated installations, designated sites or designated facilities or that produce other environmental benefits for such communities".
Noble Lords will recall that at the Report stage the Government clarified that this was a supplemental role for the NDA. It had the function because it had a role in providing "some" support. Responding on behalf of the Government on 18 March, the noble Lord, Lord Davies of Oldham, made it clear that the Government did not see the NDA as the right body to take responsibility for addressing the social and economic impact of Decommissioning. That responsibility resided with local or regional bodies. My aim this evening is to demonstrate that that is the wrong approach.
However, the noble Lord went on to explain (at col. 444 of Hansard) that the authority would have a role:
"Nor does it mean that the NDA will have no role to play in this regard. It clearly has a contribution to make. Like any significant employer—such as BNFL before it—the NDA will play an active role in encouraging and supporting activities and initiatives that bring social and economic benefit to local communities".
That is exactly our point. Further to this, the noble Lord went on to say:
"Where the NDA is the employer and where it is involved in taking responsibility for action, of course we must look at the way in which we can use its resources to support and buttress the local economies as best we can".—[Official Report, 18/3/04; col. 446.]
The amendment I now propose seeks to address and clarify in the legislation this important role, and to seek to turn the Government's fine words into positive action. Here I reflect the previous debate during which my noble friend Lord Peyton made exactly the same point about nuclear energy in seeking to turn the Government's fine words into positive action.
I recall years ago the example of BNFL which, in Cumbria in particular, contributed significantly over a long period to the economy and social well-being of the locality through its employment practices and the funding it has committed to the support of local communities. Many people in the areas where BNFL operated remember with great warmth the hard work of the late Sir Christopher Harding, the chairman of BNFL, on these endeavours.
The NDA will take over responsibility for Decommissioning and clean-up and, with its substantial resources, will be a significant employer. It will have within its control the entering into large contracts for securing the Decommissioning and cleanup work. Through those contracts there will be an opportunity to incentivise the successful operation of the contracts in terms of providing new employment opportunities, the commercialisation of technologies, encouraging local spend, and so forth. Opportunities will also arise for the NDA to release clean-up sites for development, thus helping to stimulate regeneration. Those are just some of the examples of how, during the course of its work, the NDA can benefit local
206
communities. While seeking to secure value for money in its dealings, the NDA must have embedded in its culture the need to meet the social responsibilities that such major organisations should have.
In the previous debate the Minister, when refusing to have the NDA bear responsibility for nuclear matters, made a particular point when he said that its role was "Decommissioning and clean-up". I ask the noble Lord: can there be any more important part of clean-up after Decommissioning than to try to clean up the ravages which the Decommissioning has caused to local communities? I would have thought that that was an essential part of "clean-up".
It is important to recognise that these measures to provide support can be carried out only by the NDA and not by development agencies. The incorporation of this amendment into legislation has two purposes. First, to help embed these values into the culture of the organisation in the way it operates in its dealings with others, it is important that these considerations are given proper weight in contractual negotiations. Secondly, to engender confidence in the NDA within the local communities affected by Decommissioning that the support previously given by BNFL or other operators is maintained and enhanced. The support of local communities is crucial to the successful operation of the NDA.
Finally on Amendment No. 4, I refer also to the duty of the NDA set out in Clause 11(1),
"in carrying out its functions, to have particular regard to…Government policy".
Through its activities the NDA can provide benefits to local communities which, as I have said, are within its remit alone. It clearly must be relevant to government policy that every opportunity is taken to increase the economic self-sufficiency of an area and to reduce dependence on the state.
I turn now to Amendment No. 6. At Report stage the Government were asked about the level of funding the NDA will feel it is appropriate to commit to supporting local communities. Again, the noble Lord, Lord Davies of Oldham, stated in reply that the NDA would have a total budget initially in the order of £2 billion. While it was indicated that there may be margins of discretion and judgment, it was made clear that there was limited provision for the support of local communities.
I have to recognise that the Government have responded positively in setting up a strategic response task force at Dounreay and, more recently, a similar task force for west Cumbria. Those strategic task forces will prepare a long-term vision for those areas and oversee its implementation. While they welcome the setting-up of the task forces, local communities are concerned that the funding available to deliver the vision will not be forthcoming on the scale required or continue in the long term, as administrations and priorities change. Here we are back to the same problem of turning fine words into positive actions.
I cannot underestimate the size of the challenge affecting those areas. They will suffer large losses in employment for which there is no readily available

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alternative employment. Attracting new businesses into those relatively remote areas will be especially difficult. In those areas, and possibly in others, there is a special case for support to address serious social and economic problems which, without concentrated action, will result from the job losses. For example, major infrastructure investment and considerable support to help the diversification of these economies will be necessary.
It is recognised that the task force is a vehicle for getting access to spending from government departments, and that is welcome. However, there is no guarantee that sufficient funding will be forthcoming from government departments, or indeed from the Government through regional development agencies. Complementary to the establishment of the task force, a commitment is sought from the Government that the money will be forthcoming to deliver what the task forces agree is required.
While the NDA will not be a primary regeneration body, the proposed amendment allows for funds to be provided in the NDA's funding to facilitate regeneration activities through the task forces; otherwise I would ask the Government how their commitment to address the problems will be seen in the long term to give the communities confidence to help to rebuild their local economies. Perhaps the Minister can advise the House how the Government may otherwise demonstrate that the funding will be guaranteed to deliver the outcomes agreed to be necessary by the task force. Clearly, the Government have a vested financial interest as well as a moral duty to secure economic recovery in those areas. Encouraging self-sufficiency of the areas will reduce the reliance on government spending in the long term on economic and social problems.
Finally, what price can be put on the readiness of local people to co-operate in the future? The nuclear industry has not always been popular, but areas such as west Cumbria and Dounreay have stood by it loyally over the years. To ensure trust and co-operation, longterm and guaranteed commitment is absolutely essential. I beg to move.
Lord Ezra: My Lords, I support the amendment so ably moved by the noble Lord, Lord Jopling. There is a social connotation to the work of the NDA. It reminds me of a problem that we had to face in the coal industry when I was directly involved in it. We started off by considering that it was our task to run the industry and that if we had to close pits for good and sufficient reason, the social implications would have to be borne by other agencies of government. However, we soon realised that that was an inadequate response. We had to set up our own body and with our knowledge of the localities involved we had to see whether we could find alternative employment for those who unfortunately were deprived of their livelihood through our actions, justified as they may have been.
208
I have great sympathy with the amendment, and I believe that the NDA should have a wider social responsibility which spells out more clearly what is implied in the Bill. The amendment spells it out in a way that I consider to be wholly desirable. Therefore, I hope that the Minister can accept the amendment.
6.45 p.m.
Lord Monro of Langholm: My Lords, I support the amendment tabled by my noble friend Lord Jopling and the kind words of the noble Lord, Lord Ezra. If, like me, one lives within sight of Chapelcross, one knows that such a closure after virtually 50 years' operation has a catastrophic impact on the local community. I know that that will equally be so in west Cumbria and at Sellafield, where I have often visited.
I would like clarification from the Government about where we stand on support for the community. At Second Reading, I raised the issue with the Government. In response the noble Lord, Lord Whitty, said:
"I referred earlier specifically to west Cumbria, where there is a heavy dependence on the nuclear industry. However, that applies also to the north of Scotland and, as far as the noble Lord, Lord Monro, is concerned, to the economic area around Chapelcross".—[Official Report, 11/12/03; col. 920.]
I want to know who will be responsible for funding that support. Will it be done through the task force or, in respect of Dounreay and Chapelcross and later our other nuclear stations in Scotland, is it to be done through the Scottish Executive? It is notoriously true that co-operation between the Government at Westminster and the Scottish Executive is pretty fragile and often non-existent. What the Government here say will happen just does not happen in relation to Scotland, or they use the Sewel rules which allow them to put through a motion in the Scottish Executive without it being fully debated. Perhaps the noble Lord, Lord Whitty, can give the House an idea of how much support the community will receive from the NDA. Is it to be funded entirely from London, or will it be supported in Scotland by the Scottish Executive?
The point made by the noble Lord, Lord Jopling, is correct. In west Cumbria and in Dumfries, the nuclear industry has worked extremely well with the community—there is the very best of relationships. As the noble Lord, Lord Jopling, said, they were fostered by the late Sir Christopher Harding most effectively. It would be tragic if the skilled workforce of 400-plus at Chapelcross were put out to grass with no jobs to go to. I know that there are bound to be jobs in the NDA and in the Decommissioning procedure, but by and large the industry has been a source of employment for skilled people with university degrees, and such jobs have provided rare opportunities in rural areas such as Dumfries and Galloway.
I hope that the Minister can give the House some encouragement and support for the amendment tabled by my noble friend Lord Jopling. It has been tabled with the very best of intentions to help areas of high unemployment when the plants are decommissioned.

209
The support that is to be provided at Dounreay and to west Cumbria will substantially be available to the other power station areas as well.
Lord Gray of Contin: My Lords, I want to associate myself with what my noble friends Lord Jopling and Lord Monro have said. To some extent, Decommissioning has already started at Dounreay. The cleaning-up has taken place and many people who were previously employed there have been re-employed, which is all to the good. I hope that the same will be achieved in other parts of the country. It is no surprise that those who have not experienced any of this yet are a little apprehensive about what may lie ahead.
The amendment is a very good one. It spells out clearly what is expected. I reiterate what my noble friend Lord Monro said: the relationship between the present authority and the local communities in the various Scottish cases has been very good in every case, particularly at Dounreay, which is the one that I know best. The relationship there has been excellent and the progress made so far has been very encouraging indeed. I am not suggesting for one moment that these standards will not be continued, but it is essential that they are maintained and, where possible, even improved upon.
The noble Lord, Lord Jopling, covered the subject very adequately. I merely want to register my total support for what he said.
Baroness Miller of Hendon: My Lords, we, too, support the amendment of my noble friend Lord Jopling and the noble Lord, Lord Campbell-Savours, who is unable for very serious reasons to be with us today. I know that my noble friend Lord Jenkin is sorry that he could not be here because he would have liked to have spoken in support of the amendment.
I have listened very carefully to what has been said. The truth is that my noble friend Lord Jopling made a wonderful introduction and covered most of the points that could be covered. I would have to dig deep to find another reason to support the amendment because he has covered them all. I was very impressed with the point that he raised in relation to the reply given to the earlier amendment by the noble Lord, Lord Davies. He pointed out that the Minister made great play of the fact that the role of the Nuclear Decommissioning Agency is first to decommission and then to clean up. Frankly, that says it all. It was the most attractive part, in a sense, of the speech made by the noble Lord, Lord Davies, which I felt was very unattractive in parts.
I am also grateful to my noble friends Lord Monro and Lord Gray for the way in which they referred to their local interests. Again, I cannot add to anything they have said. They covered the issue of local knowledge and they know what is going on. It was interesting that the noble Lord, Lord Ezra, spoke about his experiences in the coal industry and how it had a duty to clean up and help the social fabric of an area when coal was no longer the predominant industry there.
210
With those few remarks, we strongly support these two most important amendments.
Baroness Byford: My Lords, my noble friend Lord Jopling has fully explained the reasons for moving the amendment. I do not wish to repeat what he said—it was very clearly put—but perhaps I may ask one or two questions directly of the Minister.
I spoke at Report stage on this issue, where the answer I received from the noble Lord, Lord Davies of Oldham, was that it would be the responsibility of the regional development agencies. What progress has been made, if any'? Have the regional development agencies accepted this responsibility and what plans do they have to discharge it?
I understand that the NDA has a limited provision of £2 billion, which it will obviously use for the whole of its work. How much of that, if any, does it anticipate setting aside to achieve the aims of my noble friend'? Clearly there will not be a pot of money on which to draw at the last minute. I imagine that certain facilities will have to be made in advance; if so, what are those? My noble friend said that he is apprehensive that sufficient funding has been made available. Can the Minister clarify that point?
At Report stage, the noble Lord, Lord Davies, said:
"I have not the slightest doubt that a great deal more needs to be done … But there we have an indication of work in progress with encouraging results. We will want to build on that experience as regards West Cumbria".
Perhaps the Minister can share his thoughts with us because I certainly have not had any response— I do not know whether other noble Lords have— since that time.
Later the Minister went on to say:
"This is in the early stages preparation, but it will be in place before the NDA takes up its responsibilities for sites in April 2005".—[Official Report, 18/3/04; col. 445.]
That is all well and good, but the amendment moved so ably by my noble friend seeks more than that. I hope that at this stage of the Bill—this is the last chance we have—the Minister will answer these direct questions.
From the feed-back that I have received of the demands that are made on the RDAs, they may be apprehensive that they will be charged with doing something for which they do not have a specific allocation of funds. I urge the Minister, if he can, to reply to that point when he responds to my noble friend.
Lord Whitty: My Lords, it is clear from our earlier discussions that the Government are conscious of the kind of problems that have been outlined, particularly in relation to the west Cumbria area, where BN FL has historically played a major role, and in the other areas of the UK to which reference has been made, including Dounreay and elsewhere. BFNL has played a significant role in the community and has done so without even the

211
statutory provisions already in the Bill, let alone the wider-sweeping changes to the Bill proposed by the noble Lord, Lord Jopling. Unlike BNFL and the UKAEA, the NDA will continue to have an active role in supporting and encouraging activities and initiatives, bringing forward social and economic benefits to the communities in which they have operated.
The noble Lord, Lord Jopling, was good enough to recognise that there are significant powers within the Bill for the NDA to do so. Clause 9 refers to giving encouragement to social and economic benefits to local communities. That is not an optional extra; it is clearly part of its powers. It refers also to environmental benefits—which are less evident in these amendments—under Clause 12, which was inserted during an earlier stage of the Bill. It has responsibilities and requirements in relation to the skilled workforce under Clause 11. As to the driving forward of the cleanup operations, there is a requirement under Clause 14 that this must contain proposals for supporting local communities, maintaining a skilled workforce and so on
The annual plan of the NDA will have to cover and report on these various areas. Certainly support for local communities will be a significant issue and will be subject to ministerial approval.
The noble Lord, Lord Jopling, referred, as did others, to the task force which has been set up in West Cumbria and the memorandum of understanding with the West Cumbrian authorities, led by the North West Development Agency. That agency is therefore a positive participant in this and the area is already a priority for the north-west regional strategy, bringing together regional stakeholders, public authorities and various companies, maximising the effect of the various relevant funding streams. Many millions of pounds have been made available through such measures.
Given that background and given the commitment of the NDA and its predecessor bodies to the communities, I am not convinced that we need any further amendments along the lines of those proposed by the noble Lord, Lord Jopling. There has been a significant partnership between the pre-existing organisations, the RDAs and the local authorities and there are very substantial powers within the Bill. But the way in which the amendments are phrased would take that significantly further and do not sit very well with the overall responsibilities of the NDA.
For example, Amendment No. 4 links government policies with the NDA's contracting arrangements. It implies that the social and economic benefits locally are more important than any other policies the Government may have in respect of nuclear clean-up. That is not a sensible approach. Clearly it is one of many responsibilities, but the environmental outcome, the speed and efficiency of clean-up, the way in which we deal with the workforce and so on must all be part of those responsibilities. That is part of the contract and it is the responsibility of the NDA rather than the Government, as Amendment No. 4 suggests.
212
I do not think the language of Amendment No. 4 is right either when it refers to the NDA having a responsibility to optimise the social and economic life of the community. I do not believe that, however dominant individual employers may be in an area, they can be given that kind of responsibility for the future of their communities. Indeed, in some ways, it would be very unhealthy for that to happen. That is why we have brought into the plan for west Cumbria and elsewhere not only a range of public authorities but also other private sector employers. I think that that is the right approach rather than placing a strategic obligation on the NDA, while recognising that the NDA will be a driving force and will provide resources to deliver those local benefits.
Amendment No. 6 is even more seriously wrong. It suggests that the Secretary of State might withhold a grant to the NDA should it be considered that the NDA is not doing enough to support local communities. Let us think about the balance: the essential task of the N DA is nuclear clean-up—a very delicate and difficult task. The NDA is under certain obligations and has certain powers beyond those obligations to deal with local and social issues, but should a future government decide that the NDA was wanting in one particular respect in delivering that, is it really sensible that the government should deprive it of funds in order to carry out its core task? Amendment No. 6 would provide a very substantial and unnecessary power which the combination of the NDA with regional and local authorities to deliver social, economic and environmental benefits will not need in carrying out the kind of objectives which noble Lords have urged on us.
The Bill as it stands provides significant obligations on the NDA to engage in that. The action of government in bringing what will be the NDA together with others to deliver support for those communities, together with the obligations in the Bill on the NDA, will deliver what people want.
As for who will be involved, in England the RDA will be a major partner, as will local authorities and others. In Scotland, the major partners will be the Scottish Development Agency and Scottish local authorities, with the general guidance of the Scottish Executive. They have responsibility for regeneration in Scotland and will partner the NDA in this regard.
The noble Lord, Lord Monro, and the noble Baroness, Lady Byford, asked what moneys will be available. It is not possible to say how much money would come from the NDA in this regard when we do not know with which sites it will be dealing in a period of operation that will last for many decades. Contributions would come from other funding streams as well as from the NDA by a combination of measures, probably led by the public sector, but also levering in other private sector moneys to create a healthy economic and social base for those communities. Therefore, with regret, I do not think it is possible for me to respond to the question of the noble Lord, Lord Monro, and the noble Baroness, Lady Byford, in terms of pounds, shillings and pence. Clearly, there will

213
be a responsibility on the NDA to provide such resources as will be appropriate to the impact of its activities on particular communities over the years. It is not possible for me to say today how much money or what proportion of NDA funds will be available for that purpose.
We all recognise the importance of the relationship between the NDA and the local communities in which it operates and is, in some cases, the dominant employer, directly or indirectly. However, I think the way in which the noble Lord, Lord Jopling, has phrased his amendments goes too far. Amendment No. 6, in particular, provides a sledgehammer to crack a nut. Important though that nut is, such a provision would interfere with the central purpose of the NDA.
I therefore hope that with the commitment from the Government and the existing commitment in the Bill on the NDA's role in this regard, the noble Lord will not feel it necessary to press his amendment.
Lord Jopling: My Lords, that was rather a strange reply. The Minister spent a good deal of his speech, particularly the early part, endorsing a good deal of what I and a number of my noble friends had said, but he came, unaccountably, to a totally different conclusion from the one to which we came. From what I heard, he did not appear to address my basic question about why clean-up should not cover dealing with the problems that are left behind by decommissioning. Minds do not seem to have met, so I wish to test the opinion of the House.
7.5 p.m.
On Question, Whether the said amendment (No. 4) shall be agreed to?
Their Lordships divided: Contents, 105; Not-Contents, 98.

Division No. 3

CONTENTS

Addington, L.

Geddes, L.

Astor of Hever, L.

Goodhart, L.

Attlee, E.

Goschen, V.

Avebury, L.

Gray of Contin, L.

Barker, B.

Greenway, L.

Blaker, L.

Harris of Peckham, L.

Bridgeman, V.

Harris of Richmond, B.

Byford, B.

Higgins, L.

Carlile of Berriew, L.

Hooson, L.

Carlisle of Bucklow, L.

Howe, E.

Colwyn, L.

Jacobs, L.

Cope of Berkeley, L. [Teller]

Jopling, L.

Crathorne, L.

Kimball, L.

Cumberlege, B.

King of Bridgwater, L.

Dahrendorf, L.

Dean of Harptree, L.

Kingsland, L.

Denham, L.

Knight of Collingtree, B.

Dholakia, L.

Laird, L.

Dixon-Smith, L.

Lawson of Blaby, L.

Eccles of Moulton, B.

Lester of Herne Hill, L.

Elis-Thomas, L.

Lindsay, E.

Ezra, L.

Liverpool, Bp.

Ferrers, E.

Livsey of Talgarth, L.

Fookes, B.

Lyell, L.

Gardner of Parkes, B.

McColl of Dulwich, L.

214

MacGregor of Pulham Market, L.

Roper, L.

Rotherwick, L.

Mackie of Benshie, L.

Russell, E.

Maddock, B.

Russell-Johnston, L.

Mancroft, L.

Sandberg, L.

Mar and Kellie, E.

Seccombe, B. [Teller]

Marlesford, L.

Selsdon, L.

Methuen, L.

Sharp of Guildford, B.

Miller of Hendon, B.

Sharples, B.

Monro of Langholm, L.

Shaw of Northstead, L.

Montrose, D.

Shutt of Greetland, L.

Murton of Lindisfarne, L.

Stewartby, L.

Newby, L.

Stoddart of Swindon, L.

Newton of Braintree, L.

Strathclyde, L.

Northbrook, L.

Taverne, L.

Northover, B

Thomas of Gresford, L.

Oakeshott of Seagrove Bay, L.

Thomas of Gwydir, L.

Oakeshott of Seagrove Bay, L.

Thomson of Monifieth, L.

O'Cathain, B.

Tordoff, L.

Onslow, E.

Vinson, L.

Palmer, L.

Waddington, L.

Peel, E.

Wade of Chorlton, L.

Peyton of Yeovil, L.

Wakeham, L.

Powell of Bayswater, L.

Wallace of Saltaire, L.

Reay, L.

Walmsley, B.

Rees, L.

Walpole, L.

Renton, L.

Wilcox, B.

Roberts of Conwy, L.

Williams of Crosby, B.

Rodgers of Quarry Bank, L.

Williamson of Horton, L.

NOT-CONTENTS

Acton, L.

Gould of Potternewton, B.

Alli, L.

Graham of Edmonton, L.

Amos, B. (The Lord President of the Council.)

Grocott, L. [Teller]

Harris of Haringey, L.

Andrews, B.

Harrison, L.

Ashton of Upholland, B.

Haskel, L.

Bach, L.

Hilton of Eggardon, B.

Bassam of Brighton, L.

Hogg of Cumbernauld, L.

Billingham, B.

Hoyle, L.

Blackstone, B.

Hughes of Woodside, L.

Blood, B.

Hunt of Kings Heath, L.

Borrie, L.

Irvine of Lairg, L.

Boston of Faversham, L.

Janner of Braunstone, L.

Brooke of Alverthorpe, L.

Jones, L.

Brooks of Tremorfa, L.

Judd, L.

Burlison, L.

King of West Bromwich, L.

Carter, L.

Kirkhill, L.

Clarke of Hampstead, L.

Layard, L.

Clinton-Davis, L.

Lea of Crondall, L.

Crawley, B.

Lipsey, L.

David, B.

Lockwood, B.

Davies of Oldham, L. [Teller]

Lofthouse of Pontefract, L.

Dean of Thornton-le-Fylde, B.

McCarthy, L.

Desai, L.

Macdonald of Tradeston, L.

Dixon, L.

McIntosh of Haringey, L.

Donoughue, L.

McIntosh of Hudnall, B.

Eatwell, L.

MacKenzie of Culkein, L.

Elder, L.

Massey of Darwen, B.

Evans of Parkside, L.

Merlyn-Rees, L.

Evans of Temple Guiting, L.

Mitchell, L.

Falconer of Thoroton, L. (Lord Chancellor)

Morgan of Huyton, B.

Patel of Blackburn, L.

Farrington of Ribbleton, B.

Pendry, L.

Faulkner of Worcester, L.

Pitkeathley, B.

Filkin, L.

Puttnam, L.

Fyfe of Fairfield, L.

Ramsay of Cartvale, B.

Gale, B.

Randall of St. Budeaux, L.

Gavron, L.

Rea, L.

Gibson of Market Rasen, B.

Rooker, L.

Gilbert, L.

Sainsbury of Turville, L.

Golding, B.

Scotland of Asthal, B.

Goldsmith, L.

Sheppard of Liverpool, L.

Gordon of Strathblane, L.

Simon, V.

Goudie, B.

Smith of Leigh, L.

215

Stone of Blackheath, L.

Warner, L.

Symons of Vernham Dean, B.

Warwick of Undercliffe, B.

Taylor of Blackburn, L.

Whitaker, B.

Tomlinson, L.

Whitty, L.

Triesman, L.

Wilkins, B.

Turnberg, L.

Woolmer of Leeds, L.

Resolved in the affirmative, and amendment agreed to accordingly.
7.15 p.m.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 5:
Page 10, line 7, leave out "a devolved administration" and insert "by a devolved administration in relation to its territory"
The noble Lord said: My Lords, Clause 11 of the Bill states:
"It shall the duty of the NDA, in carrying out its functions, to have particular regard to each of the following—
(a) relevant Government policy".
If I can grace "relevant Government policy" with this, we are coming to what I call the gritty little parts of the Bill rather than the major issues of policy with which we have been dealing until now.
Over the page in subsection (4), Clause 11 continues:
"In this section 'relevant Government policy' means all current policies which—
(a) relate to the decommissioning of nuclear installations, the cleaning-up of nuclear sites or other activities in relation to which the NDA has functions; and
(b) have been published by or on behalf of Her Majesty's Government in the United Kingdom or a devolved administration, have been notified to the NDA by the Secretary of State or have been notified both to the NDA and to the Secretary of State by a devolved administration".
No distinction is made, as far as the NDA is concerned, as to whether a policy is enunciated by the Secretary of State on behalf of the United Kingdom Government or indeed by one of the devolved authorities which simply have to notify their policy to the NDA and to the Secretary of State. It is then appropriate as a policy which the NDA has to follow.
No distinction is made between national policies and relevant government policies made by a United Kingdom Government and policies made by any devolved authority, so there is inadvertently an extension of the devolution settlement made in both the Scotland and Wales Acts. My amendment would put that right by limiting the actions of the devolved administrations to only those policies applying in their own particular territories.
This is important because when the Bill becomes an Act, we will have to deal with what is written in the Bill—not what we want it to mean or what we think it means, but what it actually says. It is not that I think that the Welsh Assembly will get particularly upset if some policy that it has enunciated for Wales is not applied in England—the same could apply to the Scottish Parliament. It is much more possible that somebody in England could think that a policy enunciated by the Welsh Assembly or the Scottish Parliament is attractive and take the NDA to court because it is not applying relevant government policies as defined in the Bill because no distinction is made.
That is a very real possibility and we have an obligation to remove it. We should not allow an extension of the devolution settlement to happen through inadvertence. That is the reason behind this amendment. I do not need to take any more time. I beg to move.
Lord Ezra: My Lords, the amendment moved by the noble Lord, Lord Dixon-Smith, is an important clarification, which I am sure the Government could accept without further debate. That is my feeling.
Lord Whitty: My Lords, it is true that at first sight I believed that the amendment was sensible and would clarify the situation in the Bill, but I have taken further legal advice on the matter. The powers of the devolved administration are clearly defined in the devolution settlement. Therefore, one could not require a public authority to take note of a document produced by a devolved administration which went beyond those powers.
If It was solely in the limited context of this Bill that we introduced the qualification that the noble Lord's amendment would provide, it might make sense. Because there is a whole range of legislation that refers to the powers and advice or consultation with the devolved administrations, all of which are presumed to be within the powers of the devolved administrations and not to breach the devolution settlement, we would muddy the waters if we wrote it into this legislation and not the other Acts. That is very strong legal advice so, despite my initial inclinations and despite encouragement from the noble Lord, Lord Ezra, I shall on this occasion stick with the advice and oppose the noble Lord's amendment. I hope that, in view of my explanation, he will withdraw it.
Lord Dixon-Smith: My Lords, the Minister will hardly be surprised that I find his response unsatisfactory. It appears to imply that what we put in the Bill cannot affect previous legislation, but that cannot be so. The Government themselves have tabled Amendment No. 26, which deliberately sets out to amend previous legislation. At a quick scan of the Bill, there are 31 clauses that amend previous legislation. This is an instance of doing it through inadvertence.
I am sorry that I have to take the time of the House on this, but we should not permit the extension of the devolutionary settlement through inadvertence. I am not entirely satisfied with the legal advice that the Minister has received. My view of legal advice when matters become technical is that one can get the opinion that one wants. I am not in the least surprised that the department's legal advisers have given the Minister the advice that they have; in a way, I should have been very surprised and disappointed if they had not. But that is the position that we are in: we have to secure the future.
If we put the amendment into the Bill tonight, it will not be the end of the matter. The Bill has to go to the Commons and be considered there, and the matter will undoubtedly be further debated. The fact that something has not been done in other legislation

217
because an assumption has been made does not mean that it should not be done when the matter has been pointed out, as it now has. On those grounds, I wish to test the opinion of the House.
7.23 p.m.
On Question, Whether the said amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 90; Not-Contents, 99.

Division No. 4

CONTENTS

Addington, L.

Methuen, L.

Astor of Hever, L.

Miller of Hendon, B.

Attlee, E.

Monson, L.

Avebury, L.

Montrose, D.

Bridgeman, V.

Newby, L.

Buscombe, B.

Newton of Braintree, L.

Byford, B.

Northbrook, L.

Carlisle of Bucklow, L.

Northover, B.

Carnegy of Lour, B.

Oakeshott of Seagrove Bay, L.

Cope of Berkeley, L.

O'Cathain, B.

Craigavon, V.

Onslow, E.

Crathorne, L.

Palmer, L.

Dean of Harptree, L.

Park of Monmouth, B.

Denham, L.

Peel, E.

Dixon-Smith. L. [Teller]

Perry of Southwark, B.

Elton, L.

Peyton of Yeovil. L.

Ezra, L.

Rawlings, B.

Fookes, B.

Reay, L.

Goodhart, L.

Rees, L.

Gray of Contin, L.

Renton, L.

Greenway, L.

Roberts of Conwy, L.

Harris of Richmond, B.

Rodgers of Quarry Bank, L.

Higgins, L.

Roper, L.

Hooson, L.

Rotherwick, L.

Howe, E.

Russell, E.

Howell of Guildford, L.

Russell-Johnston, L.

Howell of Guildford, L.

Seccombe, B.

Jopling, L.

Selsdon, L.

Kimball, L.

Sharp of Guildford, B.

Kingsland, L.

Sharples, B.

Knight of Collingtree, B.

Shaw of Northstead, L.

Laird, L.

Shutt of Greetland, L.

Lester of Herne Hill, L.

Skelmersdale, L. [Teller]

Lindsay, E.

Steel of Aikwood, L.

Liverpool, E.

Strathclyde, L.

Livsey of Talgarth, L.

Thomas of Gresford, L.

Luke, L.

Thomas of Gwydir, L.

MacGregorof Pulham Market, L.

Thomson of Monifieth, L.

Tordoff, L.

Mackie of Benshie, L.

Vinson, L.

Maddock, B.

Waddington, L.

Mancroft, L.

Wade of Chorlton, L.

Mar and Kellie, E.

Wakeham, L.

Marlesford, L.

Wallace of Saltaire, L.

Masham of Ilton, B.

Wigoder, L.

Mayhew of Twysden, L.

Williams of Crosby, B.

NOT-CONTENTS

Acton. L.

Blood, B.

Alli, L.

Borrie, L.

Amos, B. (The Lord President of the Council.)

Brooke of Alverthorpe, L.

Brookman, L.

Andrews, B.

Brooks of Tremorfa, L.

Ashton of Upholland, B.

Burlison. L.

Bach. L.

Carter, L.

Bassam of Brighton. L.

Clarke of Hampstead, L.

Blackstone, B.

Clinton-Davis. L.

218

Crawley, B.

Layard, L.

Currie of Marylebone, L.

Lea of Crondall. L.

David, B.

Lipsey, L.

Davies of Coity, L.

Lockwood, B.

Davies of Oldham. L. [Teller]

Lofthouse of Pontefract, L.

Dean of Thornton-le-Fylde, B.

McCarthy, L.

Desai, L.

Macdonald of Tradeston, L.

Dixon, L.

McIntosh of Haringey. L.

Donoughue, L.

McIntosh of Hudnall, B.

Eatwell, L.

MacKenzie of Culkein, L.

Elder, L.

Massey of Darwen, B.

Evans of Parkside, L.

Merlyn-Rees, L.

Evans of Temple Guiting, L.

Mitchell, L.

Falconer of Thoroton, L. (Lord Chancellor)

Patel of Blackburn, L.

Pendry, L.

Farrington of Ribbleton, B.

Pitkeathley, B.

Filkin, L.

Puttnam, L.

Fyfe of Fairfield, L.

Ramsay of Cartvale, B.

Gale, B.

Randall of St. Budeaux, L.

Gavron, L.

Rea, L.

Gibson of Market Rasen, B.

Rooker, L.

Gilbert, L.

Sainsbury of Turville, L.

Golding, B.

Scotland of Asthal, B.

Goldsmith, L.

Sheppard of Liverpool, L.

Gordon of Strathblane, L.

Simon, V.

Goudie, B.

Simon, V.

Gould of Potternewton, B.

Smith of Leigh, L.

Grenfell, L.

Stoddart of Swindon, L

Grocott, L. [Teller]

Stone of Blackheath, L.

Harris of Haringey, L.

Symons of Vernham Dean, B.

Harrison, L.

Taylor of Blackburn, L.

Hilton of Eggardon, B.

Tomlinson, L.

Hogg of Cumbernauld, L.

Triesman, L.

Howells of St. Davids, B.

Turnberg, L.

Hoyle, L.

Walpole, L.

Hughes of Woodside, L.

Warner, L.

Hunt of Chesterton, L.

Warwick of Undercliffe, B.

Hunt of Kings Heath. L.

Whitaker, B.

Jones, L.

Whitty, L.

Judd, L.

Wilkins, B.

King of West Bromwich, L.

Williamson of Horton, L.

Kirkhill, L.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
7.34 p.m.
Lord Jopling Lord Jopling moved Amendment No. 6:
Page 11, line 27, at end insert—
"() In determining whether to make a grant to the NDA under section 24, and the amount of any such grant, the Secretary of State shall have regard to the extent to which in his opinion the NDA should make grants and loans under subsection (2)(c) for the purposes of mitigating any adverse effect of the decommissioning of designated facilities on the social and economic life of communities living near installations."
On Question, amendment agreed to.
Lord Triesman: My Lords, I beg to move that the proceedings on Third Reading be now adjourned until 8.35 p.m.
Moved accordingly, and, on Question, Motion agreed to.

Illegal Immigration
7.35 p.m.
Baroness Harris of Richmondrose to ask Her Majesty's Government, further to the report from the Select Committee on the European Union, Fighting illegal immigration: should carriers curry the burden? (5th Report, HL Paper 29), whether the draft directive requiring air and sea carriers to transmit data on all their passengers to border control authorities in advance of travel will contribute effectively to curbing illegal immigration without resulting in disproportionate costs for carriers and disruption for passengers.
The noble Baroness said: My Lords, I am very glad to have the opportunity to debate this report, even though it comes at the 11th hour. At its meeting on 30 March, the Justice and Home Affairs Council agreed a general approach to the draft directive. Indeed, the Home Office issued a press release immediately after the meeting, announcing that the measures had been agreed there. The pressure to reach an agreement has been intensified by the fact that the directive will fall unless it is approved by the end of this month. Nevertheless, the directive raises important issues on which the House should have an opportunity to register its views.
The objective of the directive in its present form can be simply stated: it is to require airlines to transmit details of all their passengers to border control authorities in advance of travel. The version of the proposal that we considered in our inquiry was more extensive: it would have applied to sea as well as air carriers and would also have created a potential obligation on carriers to notify border control authorities of the non-use of return tickets. Although the scope of the proposal has been limited, its central element is essentially unchanged and so are the committee's objections to it.
The proposal is not objectionable in principle. However, we need to be clear precisely what benefits the proposal might deliver and what it could not. Given the time constraints associated with check-in procedures, all that would be possible would be a computerised check against a database of names of people who are to be refused admission or who are "of interest" to the immigration or security authorities. I do not deny that it might be of value to be able to identify such passengers before they actually present themselves at immigration control, but the proposal's value in combating illegal immigration would be strictly limited. Such people, if not identified before boarding, should normally be picked up on arrival at immigration control. What the proposal would not do, contrary to the impression that the Home Office has given, is identify people with false documents, still less those who are likely to destroy their documents en route. If a person presents apparently satisfactory documents at check-in, he or she is unlikely to be identified as a potential immigration threat by a check against a nominal index.
220
It is particularly important to understand that the proposal would be of only limited security value. In announcing that this measure had been agreed, the Minister prayed in aid
"the heightened terrorist threat following the recent tragic event in Madrid, and the international nature of organised crime".
The committee found no evidence of its effectiveness to combat organised crime or security threats. The requirement to transmit passenger data will not identify people who are threats to our security, unless their names are already on a warnings list and they are travelling on documents that identify them as such.
What is needed is a careful calculation of the potential benefits of the scheme against all the costs. As I have indicated, while not negligible, the benefits are strictly limited and what of the costs? Here we have been kept almost totally in the dark, since no impact assessment has been undertaken for the proposal as a whole and the Government have only produced a regulatory impact assessment with their response to our report. I have to say that it is a very poor piece of work indeed and it throws very little light on the cost/benefit equation.
What is needed is accurate quantification of the main cost components. First, there is the cost to the carriers. It would be impracticable to implement the scheme other than by means of a computerised check against a centralised warnings index. This means that every check-in desk in the world that processes flights to the EU will need the facility to scan the relevant data into the system, and transmit it for checking against the relevant database. I do not know how many check-in desks there are in the world, and I have no idea how much such a system would cost, but I hazard a guess that it would not be peanuts. This cost would fall on the airlines with no compensating benefits for them.
Secondly, there is the cost and disruption to passengers. As your Lordships will all know from personal experience, the check-in procedure has to be conducted against very tight and inflexible deadlines. Even a small addition to the procedure is likely to have a significant cumulative effect. The Minister told us when she gave evidence—and this is repeated in the Government's response—that the Home Office was looking for a response time of six seconds per passenger; the airlines estimated that data collection would increase each check-in transaction time by between 40 and 60 seconds. I leave it to your Lordships to decide whose estimate you prefer. For large flights the effect of the procedure is likely to extend overall check-in times by a substantial amount, possibly hours rather than minutes. It is not difficult to envisage the additional delays to passengers and the consequent pressure on the check-in areas of airports, and the increased risk of missing flights and of flight delays.
Thirdly, what happens if the check throws up a match with the database? The directive now provides for the check to take place,
"by the end of check-in".
Before it was "in advance of boarding". The Government want the procedure to operate so that someone who is identified as likely to be inadmissible in

221
the destination country can be denied boarding. That would certainly make it a more powerful instrument, but is likely to give rise to additional difficulties. One can imagine the scene when someone is told, with no reason given other than that they have fallen foul of a remote computer, that they will not be allowed to board the flight; and the effect on the queue behind them. The one certainty in all this is that mistakes will be made, but there is no provision in the directive for any redress or compensation for passengers wrongly refused boarding. The Minister told us that the United Kingdom would provide a 24-hour helpline, but it seems unlikely that the person at the end of the phone will be in a position to give reasons for the denial of hoarding. Perhaps the Minister can enlarge on this in her reply. I would add only that we are not alone in our reservations about this proposal. The European Parliament, when consulted about it, rejected it decisively.
Finally, I must protest about the handling of this dossier. The regulatory impact assessment that has now been produced is a most unsatisfactory document, but even if it had been a much better product, what is the point of an assessment produced days before the directive is due to be adopted? Surely the 'whole purpose of this process is to inform the debate on whether the proposal should be adopted.
When our report was published, I described the proposal as "half-baked". I wish that, in the light of the changes that have been made since then, I could withdraw that description, but I am afraid I cannot. Although some improvements have been made, the fundamental flaws that the committee identified in its report remain, and our concerns have not been allayed by the Government's response.
This debate has the effect of clearing from scrutiny the document which is the subject of the report. Normally we would have associated with that document the later texts that have been submitted for scrutiny. On this occasion, however, we do not believe that we would be justified in clearing the latest version of the directive from scrutiny today. I believe that the Government have shown scant regard for the scrutiny process by signing up to a general approach, which they themselves describe as an "agreement", before that process has been completed. I see that the Minister's press release referred to the fact that the directive would be subject to parliamentary approval only in the notes for editors. The European Union Committee has not yet had an opportunity to consider the regulatory impact assessment or the latest draft of the directive, which was submitted only yesterday. We will examine this text in more detail at our meeting tomorrow, but I hope that the House will agree that, if the proposal is still subject to the objections that we have identified in previous versions, we should not clear it from scrutiny against our considered judgment simply on account of the deadline of the end of the month.
I look forward to hearing the Minister's response and through her would urge the Government, even at this late stage, to reconsider their support for this measure. In our view it should be withdrawn and reintroduced by the Commission only after a full assessment of the implications for passengers and carriers.
222
Finally, I understand that the Commission is planning to bring forward a draft directive in June on passenger data. That should be the vehicle for a measure of this kind and would allow proper scrutiny.
7.46 p.m.
Baroness O'Cathain: My Lords, I welcome the opportunity given to the House to debate a very important issue and, in doing so, congratulate wholeheartedly the committee on a most interesting report.
Before going any further I have to declare an interest as a director of British Airways but I have received no briefing from it other than a copy of the evidence that it submitted to the committee which is printed in the report. Today I received an update of developments since the directive was first published, which we have heard from the noble Baroness, Lady Harris. I am, of course, drawing on my experience with the airline but there is no special pleading from it in this case.
I am not being in the slightest bit patronising hut I wish to say that this report is a very good, informative and well researched document. As a short report it is a great deal more comprehensive than its size would seem to imply. I have experience of being on Select Committees where short reports are undertaken as "fillers" in between major inquiries. They are quite often rushed and thin on evidence. This is certainly not the case with this report, even though there was only one session of oral evidence.
The written evidence is of a high standard and the conclusions drawn by the committee from the written evidence show a significant depth of understanding of the fundamental issues, and they are not easy. No wonder that the reports of the European Union Committee of the House of Lords are so highly regarded elsewhere, not least in Brussels.
The most startling feature of the directive is the fact that it is limited to requiring carriers to co-operate with member states' border controls to assist national authorities to combat illegal immigration but nowhere is there any mention in the directive of the necessity to combat international crime nor to deal with threats to national security.
However, in the evidence from the Minister, equal emphasis was placed on these last two issues as on the illegal immigration issue. This is yet another case of the UK Government not only apparently accepting the directive—which, as the noble Baroness pointed out, was issued by Brussels without any explanatory memorandum and completely without any, even tentative, analysis of probable cost—but also gold plating it to an extent which would engender massive costs and huge disruption to the flow of travellers, whether for business or leisure, between this country and the rest of the world. Is this sensible, just or evenhanded? What about the competitive position of the United Kingdom?
Why do we so often see the publication of a draft directive from the EU as an opportunity to preen ourselves as the "best boy on the block" and out-do the

223
original perpetrators of the directives? In this particular example the committee pointed out rather trenchantly in paragraph 9:
"The effectiveness of the proposal as a tool to combat organised crime or threats to national security has not been substantiated".
Having just made that point about the committee's view, I think it quite remarkable that all 14 of the conclusions and recommendations contained in chapter 3 of the report are in effect negative. That surely must be a record for a report from the European Union Committee. I congratulate the committee on being so forceful in its analysis and conclusions, but is it not dreadful that a draft directive such as this should be so transparently lacking in any sense? It would be unworkable, discriminatory and disproportionate. It would impose huge costs on only one sector of the travelling public; namely, air passengers. Everything else is in the "all too difficult" basket. Would it have any chance of curbing illegal immigration? I fear not. I equally fear that the people who drew up the directive have no conception of how travellers behave; air rage would be the order of the day, every day.
The noble Baroness described the check-in situation and the time that it would take to process the additional information. One little situation described in the evidence of Britannia Airways illustrates the unworkable nature of the proposals. Every individual on every intra-EU and in-bound flight from a non-EU destination will have to have their details taken at check-in to identify any third-country nationals on board. That would of course involve passport machine readers. Checking those documents on the readers could take up to a minute per passport, as we have been told. A Boeing 747–400 has a capacity of 359 passengers. I have been on four in the past five weeks that were full—good for the airline, but not great for the passengers who have to check in. To comply with the directive alone, not to mention the rest of checking in baggage, checking tickets and so on, would require six additional hours' check-in per flight. Need I say more? Please note that that is not BA evidence, but that of Britannia Airways.
The most fascinating and worrying section of the report is the examination of the government witnesses, the Parliamentary Under-Secretary of State and the two officials of the Home Office. The responses to the questions show a poor understanding of the reality of 2Ist-century travel. Do they not realise that Heathrow alone handles nearly 50 million passengers a year? The Minister said that it was important to,
"have access to passenger information … at check-in",
relying on electronic response. In answer to question 37, the Minister was not exactly reassuring about the ability of the Government to Commission a foolproof system—and can we truly have any confidence in any IT project handled by the Government now? Government involvement in complex IT systems has been a catalogue of disasters. Being told by the Minister in the same answer that,
"we are all on a learning curve",
does not fill me with confidence. How long and steep is the curve?
224
The admission of gold-plating comes in answer to the noble Lord, Lord Avebury. The answer was:
"We are increasingly looking at it"—
the directive—
"in terms of border control, as being about immigration, Customs issues and policing issues".
That involves other government departments as well as the Home Office. It is a nightmare scenario. Let us not forget that the hijackers of the four aircraft involved in the dreadful disaster and tragedy of 9/11 all had valid passports and visas.
As the noble Baroness pointed out, no regulatory impact had been produced when the report was published. She tells us that one has just been produced, but unfortunately I have not seen it. That brings me to my real search for information on what has happened and is likely to happen with the directive. Doubtless we shall hear from the Minister about that. However, in advance of that, I inquired what BA's interpretation of the current situation was. Hot off the press today, it said:
"At the time BA submitted evidence … to the House of Lords … the draft EU Council Directive on the obligation of carriers to communicate passenger information included some onerous and difficult requirements. For example, passenger information included data that was not found in the machine-readable zone of the passport (place of birth); and data was required on passengers not departing the EU as ticketed.
"Since then, the Council Directive has been modified and some requirements have been deleted. What remains is a requirement to collect and transmit passport information … which can be collected by passport reader, and fines of up to 5000 Euros for non-compliance.
"The UK already has legislation in place that requires carriers to collect and transmit this data (UK Immigration (Passenger Information) Order 2000). To date, BA and few other carriers have been required to collect data specified in the Order. This is in part due to the assurances given by Home Office Minister Barbara Roche…in written answers on 6 April 2000",
that showed some flexibility on the part of the Government. In the interests of time, I shall not read the whole Answers. BA continued:
"Since then, BA has been working with the Immigration Service in support of their E-Borders initiative which includes a scheme to collect and transmit passenger information on flights to and from the UK called an Authority to Carry scheme. Permission to carry the passenger will be sought electronically from the Immigration Service whilst the passenger is at check-in".
There are some benefits for the airlines in that, and BA will support its operation, but only,
"on a limited number of routes.
"The scheme envisaged in the EU Directive is different from the Authority to Carry scheme in that it requires the transmission of bulk passenger manifests upon flight departure with no benefit to the carrier".
However, it is of huge cost to the carrier. BA said that it and other airlines had,
"major objections to such a scheme for operational and cost reasons".
I look forward to hearing the Minister's reply, because I am sure that we all need to know more on the issue.
7.56 p.m.
Lord Clinton-Davis: My Lords, first, I ought to declare an interest as president of the British Airline Pilots Association. Secondly, I think that the subcommittee has done an excellent job. The noble Baroness, Lady Harris of Richmond, who introduced the debate, was extremely generous in the way in which she opened her remarks. Happily, that generosity was not borne out by her speech.
I regret to say that I see little in the Government's concept, in both theory and practice, which would commend the draft proposal to this House. The Minister has specifically stated that the measure as drafted has "serious and fundamental flaws". Despite that, the Government have opted in. They have ignored the sub-committee's views. In the final analysis, this debate is something of a charade in that, in all essential respects, the Government have made up their mind. They propose to bypass the subcommittee altogether.
Illegal immigration is a serious issue, of course, but, at least between the time that the text of the proposal was first considered and 9 October—the date of the Minister's letter—it remained unaltered, with all its faults. That is hardly an indication that the EU at that time moved with lightning speed to address the matter.
I share the apprehension voiced by the noble Baroness, Lady O'Cathain, and by British Airways, Britannia, Virgin, BARUK and the British Air Transport Association about the proposal. Regrettably, their concerns have not been adequately met by the Government. I hasten to add that I am deeply ashamed, as a loyal supporter of the Government, that that has been their response. The reason is that the Government have failed to understand that airlines are in the business of transporting passengers, rather than operating border control issues. That was the criticism voiced by BARUK.
Will there be avoidable delays, so far as departing and arriving passengers are concerned? British Airways has stated that it fears that congestion at airports will inevitably follow. Is that correct? Is it also correct that aviation companies would have to bear extensive costs in installing new computerised passenger tracking systems? The views of both British Airways and Virgin are clear. They could be impolite, if that was the order of the day. They could have gone much further, but that would have been impolite. The proposals—not just this one—are half-baked, to echo the views of the noble Baroness, Lady Harris.
There is no world-wide system that can electronically collect advanced passenger information. Similarly, not all passports are machine-readable. Therefore, if we are to attain 100 per cent accuracy, we shall be dependent on manual checking if we are to do something else. In practical terms, that means making sure that the proposal is considered globally. It is not impossible for global guidelines to be worked out, either by ICAO or IATA, and considered by the airlines and governments. After all, it is an important issue which should not be decided in five minutes, five hours or five days.
226
The European Union has not shown undue haste regarding the issue. There is plenty of time for the views of the sub-committee to be further considered. Unfortunately, the Government have made up their mind. It is premature to introduce new systems—for example, European border initiatives—until there has been adequate consideration, consultation and implementation on a global basis of any new system.
We should also consider how our existing provisions answer, or fail to answer, the most immediate threats. Is it also correct, as Virgin has alleged, that the cost of implementation of the type of proposals envisaged are to be borne by governments of many of the competitors of British airlines? It is appalling that some governments will support the idea and others will not. Our Government are among the latter.
The Immigration Law Practitioners Association has also raised important questions. In the short time available to me I shall quote some of the matters that concern them. First, they say that the proposal contains,
"no explanatory memorandum which sets out the background, the history and the justification for the measure".
I would have thought that that was absolutely vital. In my experience, both as a Minister in both Houses, and here, as a Back-Bencher, I cannot recall a situation where such a position has been replicated. It is deplorable.
Secondly, the ILPA says that the scrutiny of the proposal is hampered by the inability of the subcommittee to do anything about the had drafting of the proposal. And that, it says, is,
"irrespective of any problems of principle, unworkable"—
I repeat: "unworkable"—
"in their first drafts".
It ought to know. The ILPA includes the people who, day by day, make sure that our immigration laws are applied. Its criticisms are not to be ignored. The ILPA makes many other critical observations—as do the airlines and my association.
The Government ought to be much more prepared to be decisive regarding these issues, and it should not be too late to say so.
8.6 p.m.
Baroness Park of Monmouth: My Lords, this is an admirable report which I read with great interest and respect. I warmly agree with the committee's view that the UNHCR proposal for the transfer of responsibility for processing asylum claims to the EU is not practical, and I do not have much more faith in the UNHCR itself, judging by its performance in Egypt and elsewhere in Africa.
It is essential to strengthen the support systems in the receiving countries—and that is, unfortunately, true of our country. Many of the law firms who advise asylum seekers in this country are both overworked and incompetent. I understand that the same inadequate resources apply to tribunals. I also feel that neither the UNHCR nor the EU can be expected to understand

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the broad range of problems faced by many countries. I support the committee's strong reservations about the proposals for directing asylum seekers to neighbouring countries—so-called regional protected areas or the "regional prong". They are countries which are themselves often poor and under-resourced—and are certainly without the means to care for refugees.
8.7 p.m.
Lord Avebury: My Lords, I congratulate my noble friend most warmly on the magnificent speech with which she introduced this short debate. The criticisms she expressed have been echoed by all noble Lords who have spoken. Strong adjectives such as "unworkable" and "discriminatory" have been used to describe the measure, despite the fact that there has been a last-minute update of the instrument that has removed some of its worst features. Nevertheless, my noble friend identified some of the significant problems which remain and which she called "fundamental flaws". We heard from the noble Baroness, Lady O'Cathain, about the enormous difficulties it will create for airlines and for millions of passengers all over the world.
We have also heard about the desperate haste with which the measure has been shoved through. I want to draw your Lordships' attention to a practical reason why haste may be inadvisable. It is that the Americans are developing their own scheme which requires carriers operating to and from the United States to provide them with electronic access to passenger name records to the extent that they are collected and contained in the air carrier's automated reservation system—in their case within 15 minutes of a flight's departure. They have similar requirements for sea carriers, but they are being removed from this measure.
In the Americans' case, the primary objective is to stop the entry into the US of potential terrorists, whereas we were told that for Europe the purpose is to combat illegal immigration. However, that has now been extended and the Government are talking about its use against potential terrorists, too.
The PNR data elements required by the US customs and border protection comprise 34 different items, while the European directive calls for only nine. But two of the elements in the European set—the number and type of travel document used and the date of birth—are not in the US set because the Americans are dealing in another way with information on the passport. Ultimately, as passports become machine-readable, that will be a different kettle of fish. No doubt every bit of information from the ticket and the passport can be transmitted in one set. That is not what we are looking at here.
The European directive, by combining some information on the passport with other information on the ticket, actually imposes greater burdens on carriers than the US PNR requirement, which deals solely with ticket information. The carriers have made it clear that while they accept the US requirements they are not at
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all happy about the directive. That has been evident from the speeches we have heard today, particularly that of the noble Baroness, Lady O'Cathain, who ought to know a great deal about the subject from her professional work.
I also have heard from British Airways and from Virgin which object most strenuously to the proposals as they stand. I believe that following the debate we need extra time to consider how we are to meet the serious objections that they voice.
We also heard that the European Parliament has rejected both sets of proposals and its Legal Affairs Committee has referred the "adequacy" of the EU/US draft agreement on the transfer of passenger data to the European Court of Justice.
If the collection of information by carriers and the transmission of that information to particular authorities in the destination countries is justifiable in order to prevent terrorism and other types of crimes, including illegal migration, it would surely be best, as the noble Lord. Lord Clinton-Davis, said, to arrive at an international agreement on the extent of the information, the data protection standards to be applied to it, and practical questions such as the point at which the information has to be supplied, the liability of carriers and the rights of persons who may be prevented from travelling by incorrect or wrongly interpreted information. The Deputy Information Commissioner makes that point clearly in his letter to the chairman of the EU Select Committee of 12 March, when he writes that,
"the Working Party believes there is a need for a global solution … in order to ensure a uniform approach allied with a harmonised set of suitable safeguards. The Commission strongly supports that view".
Yet, despite that, we are being asked to endorse two different sets of proposals—one for the EU and one for the US—which are entirely incompatible with one another.
As regards the directive, the "adequacy" decision under Article 25 of the Data Protection Directive was not submitted for scrutiny, as we have heard. In his letter to the chairman of the Select Committee dated 26 February, the noble Lord, Lord Filkin, apologised for the Government's failure to identify that decision as being of such importance as to trigger the arrangements for scrutiny of comitology legislation. The Minister then went on to say that the timetable for approving the draft EU/US agreement on the transfer of PNR data was likely to be very tight and that he wanted its consideration by the Select Committee to be expedited. He has already instructed the UK member of the Article 31 Committee to support the draft adequacy decision without giving us the opportunity to scrutinise it.
Of course, we agree with the noble Lord, Lord Filkin, that the UK should not put itself in a position where its commitment to combating terrorism is called into question, and we are not challenging the principle of using PNR data for that purpose. But we should not simply abandon our right and our duty to scrutinise the proposed legislation properly—not only but especially so where data protection is at issue, as it is in both these measures. I

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believe that that would be an extremely dangerous precedent for us to set and one that we would certainly live to regret.
The US has limited data protection laws, which give no rights to non-US citizens and no redress for any damage they may suffer through the use of their personal data, which is to be transferred under the proposed EU/US agreement. This is the first occasion on which operators in the EU are to be made to transfer data—on a massive scale at that—to a public authority in a third country in a way that is not consistent with the Data Protection Directive. It is proposed to regularise this unusual proposal in two ways: first, via the undertakings by US Customs and Border Protection, for example, to disseminate the data only in certain specified circumstances and to certain "designated authorities" but without offering any remedy to a person whose data are used in a way that contravenes those undertakings; and, secondly, by means of the adequacy decision, which I have already mentioned and which allows carriers to transfer personal data and to make their computer systems available to the CBP to "pull" data without technically breaking domestic data protection legislation, whatever use is made of the data in the US.
The worst feature of the rush to comply with both the US demands and those which come from the EU is that if our committee decided to hold the proposals under scrutiny, as we should do, we can be fairly certain that the Government would override the scrutiny reserve. If I am wrong about that, the Minister, in her reply, can correct me. But if she says nothing. this is a case where one of the most far-reaching proposals ever to come before the committee cannot be properly considered because of the exigencies of the timetable.
8. 16 p.m.
Viscount Bridgeman: My Lords, I join other noble Lords in congratulating the noble Baroness, Lady Harris, and her committee on their excellent report and, in particular, on the clear way in which their proposals and recommendations are set out in Chapter 3.
It is fortuitous that this debate comes in the middle of the Committee stage of the Asylum and Immigration (Treatment of Claimants, etc.) Bill. On the first day of Committee on 5 April, my noble friend Lady Anelay gave notice that, in the course of this debate, we would be pursuing in further detail the matter of the new clause introduced by Amendment No. A1. The report has rightly highlighted the concerns that carriers have, and I know that the concerns of the Regulatory Best Practice Group have been made known to the Minister. Indeed, those were highlighted by my noble friend Lady Anelay in Committee. What I have to say will therefore come as no surprise to the Minister. However, I hope that her replies to the points that I shall raise will satisfy us to the extent that it will not be necessary to return to this matter in any detail on Report.
On the first day of Committee on 5 April, my noble friend Lady Anelay, as reported at cols. 1596–97 of Hansard, mentioned several points which were giving
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carriers concern. They included the unacceptably short notice given by the Government for consultation on the regulatory impact assessment, as referred to by the noble Baroness, Lady Harris, which fell well outside the Cabinet Office guidelines. The case made by the carriers for favourable treatment on the cost of equipment given to the fishing industry was another point. Admittedly, my noble friend's amendments were probing, but I have to say that the Minister's reply was not wholly encouraging.
Since then, the Government have given a considered reply to points raised by the committee. However, the question of proportionality and associated costs remains uppermost in the minds of the carriers. We from these Benches support the broad concept of API and accept that some cost must fall on the carriers. We are also persuaded that the requirements must apply to both EU and non-EU citizens, but we note that the API requirements are to apply, certainly for the present, on flights originating only outside the EU. There seems to be a certain amount of confusion about this point. I should welcome clarification on it from the Minister because it appears to be specifically set out in the regulatory impact assessment report.
I am not totally reassured by the confidence of the Minister in another place that there will be a minimum increase in delays in checking in. The noble Baroness, Lady Harris, has given telling figures. In addition, we share the concern of carriers that insufficient account has been taken of the huge disparity in the availability of technical facilities which API will demand. The major airports where such facilities exist will be well equipped to cope with these requirements. However, for the ones in less resourced countries from which statistically many of the immigrants can be expected to come, it will be a costly imposition in terms of both finance and good will. The carriers complain that 10 airports have been chosen to implement the first phase of the scheme and that the illegal industry will simply avoid those. I understand that the Government do not regard that as final, and I should welcome the Minister's assurance that this is a matter for further consideration.
We note that Johannesburg has been chosen as the first airport to operate API. It is an airport with a very limited number of daily flights to the United Kingdom. How is API to stand up to airports with heavier traffic on the route to, for example, Bangkok, Lagos or Miami? I think that it is also true to say that the carriers feel the Government are not taking fully into account the commercial implications of the directive's requirements. The last-minute bookings trade, exemplified by lastminute.com for instance, is a huge marginal revenue earner for airlines. The business travel market is a major earner for the airlines and while admittedly alternatives for travel from outside the European Community will be limited, it cannot but have a negative effect on airlines' revenues.
The RIA has been quite frank that it has not made a small business assessment. That is one of the deficiencies of this report, a point to which other noble Lords have drawn attention. It has not carried out this test, but this is another potential cost to industry,

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whether it is the passing on of costs by the airlines to small travel agents or the cost of business travel to small businesses, of which the Government must be aware.
The Government remain vague about the cost implications of various technological alternatives to the photocopying of all identification documents on which there is total agreement that this is not workable. Caroline Flint in another place was optimistic about the solutions here, but the report specifically gives no cost estimate for what is option 3 in its document. I would welcome any flesh that the Minister can put on these good intentions—to mix a metaphor—if necessary by a letter to be placed in the Library.
There are a number of points in Miss Flint's letter which address some of the committee's concerns. We are pleased with her assurance that the Government intend to remain fully involved with negotiations on the final form of the directive. However, I wrote this before the Baroness, Lady Harris, spoke. They have given an assurance that ample time will be given to the committee for final scrutiny. The Minister's letter to the noble Lord, Lord Grenfell, who I am pleased to see in his place, states that the committee has requested that it be provided with ample time to scrutinise fully an EC/EU decision or international agreement in the field of API and that the Government will make every effort to ensure that the committee has adequate time for scrutiny in this area, given the importance of the subject and its implications. I can only refer noble Lords to what the noble Baroness said.
I trust your Lordships will forgive me for taking advantage of this opportunity, which is too good to pass up, effectively to extend the debate on the asylum Bill. However, I cannot too strongly emphasise that, while the necessity for this legislation is appreciated by all parties, we are concerned that the Government are taking the airline industry for granted and are minded to load a disproportionate cost of this operation on to the airlines without making concessions which go some small way to alleviating the burden. If the Minister is able to address our concerns—if necessary by way of letter—we would hope to avoid the necessity of extensive amendments on Report.
Perhaps I may once again thank the noble Baroness, Lady Harris of Richmond, and to congratulate her and her committee on their excellent report. I look forward to the Minister's reply.
8.23 p.m.
Baroness Scotland of Asthal: My Lords, I, too, thank the noble Baroness, Lady Harris, for raising the issue, which has important implications for carriers, passengers and border control authorities. I very much welcome the opportunity to explain the Government's position with regard to the initiative.
Perhaps I may straightaway express my disappointment that the efforts made by the Government to explain why we have taken this course have met with such a poor reception, not least to say to my noble friend Lord Clinton-Davis that
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I am very disappointed indeed that he feels that the Government have failed to understand the business of the airline industry and that it is a participant with us in issues in relation to securing our borders.
I hope that my comments will reassure my noble friend in particular but also the noble Baronesses, Lady Park and Lady O'Cathain, and the noble Lord, Lord Avebury, that the Government have a better understanding than they fear.
Advance passenger information can, we believe, deliver significant benefits, not only in the fight against illegal immigration, particularly in the area of document and identity abuse and improving border controls, but also in the wider areas of law enforcement and countering terrorism.
I certainly hear what was said about the events of 9/11, but those were peculiar offences. I know that noble Lords will agree that there are many cases of identity fraud across international borders that can be stopped by our taking appropriate measures. These measures will assist us greatly in that regard. The border agencies have been aware of those benefits for some time. The Immigration Service, Customs and Excise and the police already have passenger information gathering powers conferred by national legislation.
We are satisfied that the passenger information requirements of the directive are largely consistent with our existing domestic legislation. For example, the information requirements of the directive broadly reflect the provisions of paragraph 27B of Schedule 2 to the Immigration Act 1971 as amended by Section 18 of the Immigration and Asylum Act 1999 and the Immigration (Passenger Information) Order 2000. Although the Government had concerns about some of the elements contained in the original proposal, we considered that the directive provided a realistic and timely opportunity to work with European colleagues to promote the development of a co-ordinated and harmonised approach to advance passenger information.
Pending a determination by the Council Legal Service on the legal basis for the directive, the Government were obliged to decide whether to opt into the measure by 25 June 2003. We elected to do so because we had already been considering how to take forward our own implementation of API, for the reasons that I have already given, and, as a result, had developed a degree of expertise in this area which we believed could usefully be shared with our European partners. It was also on the understanding that we would have an opportunity during the working group discussions to shape the final text to reflect the United Kingdom's concerns. The Council Legal Service subsequently classified the measure as building upon Article 26 of the Schengen acquis, which essentially means that the United Kingdom is deemed to have automatically opted in under Article 5 of the Schengen protocol.
Although we have supported the directive since its inception, we have always made clear that we consider it absolutely crucial that the use of data obtained under the directive should not be restricted to combating

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illegal immigration. The heightened terrorist threat following the tragic event in Madrid and the international nature of organised crime demonstrate how important it is that we get it right. It is vital that we use every resource at our disposal.
We have negotiated hard in an attempt to produce a satisfactory final text to safeguard the United Kingdom's interests and to enhance the effectiveness of the proposal. We believe that the directive now provides the necessary flexibility to support processes that will maximise the benefits of advance passenger information.
The directive provides a framework—I emphasise that it is a framework—to enable member states' authorities to develop obligations for carriers to provide passenger information. The Government recognise that the development costs are critical in establishing the necessary technological infrastructure to bridge the gap that currently exists. In developing advance passenger information processes that build on that framework, the Government will look to work with carriers rather than impose solutions without consultation.
The noble Baroness, Lady O'Cathain, gave a graphic example of where we are already doing that— I believe that we are doing so very sensitively, appropriately and to the satisfaction of all. Working together we have been able to develop very practical, workable solutions that have inured to the benefit of not only the industry but the aims of security and safety that we all wish to advance.
There is significant scope for limiting costs through the development of a co-ordinated and harmonised approach. The UK is not alone in its recognition of the benefits of advance passenger information against a backdrop of rising passenger figures, resource constraints from any border control authorities and an escalating terrorist threat. An increasing number of countries have introduced, or are taking steps to introduce, systems based on advance passenger information. The Government consider that it is crucial that the United Kingdom be at the forefront of this movement, playing an active role in shaping the framework on which many of these systems will be based. This template will be set and, frankly, we would prefer it to be set with us than without us.
We also recognise that there are significant data protection implications associated with this measure. The greatest of care will be taken in the processing of such data, with a view to correct and accurate usage to prevent such infringement. I know that is an issue that the noble Lord, Lord Avebury, has been particularly concerned about. We will also seek to ensure that data is processed securely and protected from inappropriate access. In developing domestic procedures, the Government will seek legal confirmation on compliance with data protection principles.
European Union Sub-Committee F raised a number of issues in its report, which the noble Baroness, Lady Harris, referred to, which was published on 12 February. In our response, the Government provided evidence to substantiate that the directive is
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a proportionate, effective and necessary measure to combat not only legal migration, but terrorism and serious criminal activity. I am sorry that that response does not seem to have reassured the committee in the way that the Government hoped. I assure noble Lords that the Government recognise the implications for carriers and passengers, and we will seek to develop processes in consultation with relevant stakeholders to minimise these wherever possible. Significant amendments to the text have been negotiated, such as the removal of the requirements for carriers to notify authorities when passengers do not use their return tickets. I hope that the committee will join the Government in welcoming these amendments.
The noble Baroness, in her powerful address in opening this debate, spoke about a number of the practical difficulties. I have already said that this is a framework. The directive does not expressly require member states' authorities to operate a board/do not board procedure. However, the Government intend to develop an authority to carry scheme, which will include a facility for passengers to be denied boarding, and we recognise the importance of providing a robust, timely avenue of redress. In view of that, the Government are developing a resolution mechanism, by which passengers may review decisions with the control authorities. It is anticipated that this mechanism would include a round-the-clock telephone inquiry line, which the noble Baroness, Lady O'Cathain, has already mentioned, which would provide the means for immediate resolution wherever possible. Regulations will be laid before Parliament that detail the authority's carry scheme, and Parliament will have the opportunity to debate this in full, because the devil will be in the detail. We would hope to deal with the practical issues that a number of noble Lords have raised.
The sequencing is therefore the framework, the API directive, the process, or processes, followed by implementation. For example, we have the Immigration Passenger Information Order 2000, for which an RIA was produced. We are seeking to introduce a requirement for all, or part, of the travel document to be copied, for which an RIA was produced. Both these processes would need to be compliant with the directive. Further processes will also need to be compliant. I hope that I have said enough to indicate that there is scope for us to address those issues.
This debate will provide an opportunity to demonstrate to the committee, and to other noble Lords gathered this evening, the considerable importance that should be placed on these issues. We are running very fast out of time. The noble Viscount, Lord Bridgeman, raised a number of issues that I would be happy to deal with tonight. I am afraid that we do not have time. I hope that he will accept that I will write to him on all those matters.
This has been a fascinating debate. Issues have been raised as to whether the impact on carriers is effective and fair. We argue that they are, and that they have been, properly dealt with. The costs to carriers will be

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taken into account. The Government hope that in what I have said today and in the details that we shall continue to give, noble Lords will feel, contrary to what has been said, that proportionality has been assured and that we shall be able to reassure the House that the scrutiny provisions are appropriate.
If I had more time, I could explain precisely the process that was adopted in relation to the progress of the directive and why the scrutiny issue has been dealt with as it has. Time does not allow me to do that, but I hope that noble Lords will allow me to write in relation to all those matters.

Energy Bill [H.L.]
8.35 p.m.
Proceedings after Third Reading resumed.
Clause 82 [Additional functions of UKAEA]:
Lord Triesman Lord Triesman moved Amendment No. 7:
Page 63, line 14, leave out "nuclear pension schemes" and insert—

"(i) nuclear pension schemes; and

(ii) such public service pension schemes as may be approved by the Secretary of State for the purposes of this subsection."

The noble Lord said: My Lords, Amendments Nos. 7 and 8 address the issue that was raised by the noble Lord, Lord Maclennan, on Report. His proposal was that the UKAEA's powers to administer pensions schemes should be widened beyond the extension already proposed by the Government to include not just nuclear pension schemes but public sector schemes in general.
Given the expertise of the UKAEA's Thurso pensions office and subject to appropriate ministerial oversight, we saw considerable merit in his proposal. The Government have therefore tabled these two amendments for noble Lords' consideration. They extend the UKAEA's powers to administer pensions schemes to "public service pension schemes". The terminology used is consistent with the Pension Schemes Act 1993 and the Pension Schemes (Northern Ireland) Act 1993. It would cover, for example, the Principal Civil Service Pension Scheme.
Before being able to administer public service schemes, the UKAEA will need to secure ministerial consent. We will also need to ensure that UKAEA is structured so as to ensure that competition is run on a fair and equal basis. The amendments provide the necessary enabling powers for the UKAEA to enter this market. I beg to move.
Baroness Miller of Hendon: My Lords, we welcome this extension of the pension rights.
On Question, amendment agreed to.
Lord Triesman Lord Triesman moved Amendment No. 8:
Page 63, line 26, at end insert "; and
"public service pension scheme" means a public service pension scheme within the meaning of the Pension Schemes Act 1993 (c. 48) (see section 1) or the Pension Schemes (Northern Ireland) Act 1993 (c. 49) (see section 1)."
On Question, amendment agreed to.
Clause 85 [Application of criminal law to renewable energy installations]:
Lord Kingsland Lord Kingsland moved Amendment No. 9:
Page 65, line 13, leave out subsections (6) and (7).
The noble Lord said: My Lords, these amendments return to a matter that we raised on Report about the scope of the criminal law.
Under subsections (6) and (7) of Clause 85, liability may attach personally to the directors and the officers of companies for any criminal offence by their company, whatever its nature, committed on an offshore renewable energy installation or in a renewable safety zone. That applies even where there may be good policy reasons why directors and officers would not otherwise be personally liable.
We support the application of the normal criminal law to renewable energy installations and the area around them and the liabilities of directors and officers that arise under that law. However, we know of no good reason either for creating the difference in approach between the onshore and offshore regimes or for widening the scope of the criminal law.
In our view, the creation of differential criminal law regimes in this manner is inherently undesirable. We need only consider the potential clash between these provisions and any new offence of corporate killing— for example, where the Government propose not to attribute liability to directors—to see how problematic Clause 85, as drafted, really could be.
After further consideration, we believe that the liability of directors and officers that would apply as if the offence in question had taken place within a part of the United Kingdom is adequately covered by Clause 85(1). On this basis, it seems sufficient simply to omit subsections (6) and (7).
The second amendment serves to omit a definition of "director" that appears to have no function if our first amendment is accepted. I beg to move.
Lord Whitty: My Lords, I opposed an equivalent amendment tabled in Committee but, having reflected on the wisdom of the words of the noble Lord and his advocacy this evening, I am prepared to accept these amendments.
Lord Kingsland: My Lords, if only achieving success for every amendment were as simple as that. I thank the noble Lord most warmly for his reaction to our amendments.
On Question, amendment agreed to.
Lord Kingsland Lord Kingsland moved Amendment No. 10:
Page 65, leave out lines 33 and 34.
On Question, amendment agreed to.
Lord Higgins Lord Higgins moved Amendment No. 11:
After Clause 89, insert the following new clause—

LICENCES FOR GENERATING STATIONS
New licences for offshore wind farms shall not be granted until the Secretary of State has Commissioned, received and approved a full report on the effects of offshore wind farms on radar, radio and other devices used by vessels for the purpose of navigation and been satisfied that these effects would not compromise safety or arrangements for search and rescue operations."
The noble Lord said: My Lords, in moving Amendment No. 11, I apologise to the noble Lord, Lord Greenway, for the fact that, due to an unexplained breakdown in communications, his name does not also appear above the amendment. We have benefited greatly from his contributions to our earlier debates on these issues.
This amendment and the two following it are all concerned with the effects and dangers of wind farms to shipping. When this matter first came to my attention at earlier stages, I was concerned about the way in which the interests of the shipping industry, but more particularly the safety aspects of wind farms in relation to shipping, had not been adequately considered.
Since then the House has agreed to two amendments which will be important in helping to improve the situation, but it still seems extraordinary to have reached what is known as Round 2 of the allocation of wind farm sites. The Crown Estate has gone ahead with putting forward proposals for sites, some in the Thames Estuary, some outside the Greater Wash and some outside Liverpool, which have progressed to the extent that individual companies have been asked to submit more specific proposals. One would have thought that, in circumstances where the Government are proposing to authorise the establishment of offshore wind farms, the first question would have been, "Where are the shipping lanes?". They could then have sited the wind farms at an appropriate distance away from them. On the contrary, the approach adopted by the Government seems to have been to site the wind farms where it seems most beneficial and to expect shipping to go around them. This seems to me an extremely dangerous approach to the problem.
That brings me specifically to the amendment before the House. One of the considerations which clearly ought to have been taken into account, but appears not to have been considered at all, is the effect that offshore wind farms may have on radio, radar and other devices used by vessels for the purposes of navigation. When we debated this matter at an earlier stage, the Minister made various suggestions, including that we should have discussions. I expressed my appreciation to him for arranging a meeting with him, together with some of his officials.
I turn to the progress that we should make on what seems to be an important point. The effect of wind farms on radar and navigational arrangements is somewhat uncertain; they can affect radar transmissions both from shore to ship and from ship
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to shore. Even at this stage it is not entirely clear how such interference will take place. Clearly, the establishment of a whole row of turbine pillars is likely to have an effect. I do not believe that the generation of electricity by the turbines is likely to affect radar, although the Minister may care to express a view on that. More particularly, the danger appears to arise from the vanes of the turbines; they may not turn either because there is no wind or because there is too much wind. We are unaware of the effects that that will have on ships' radar. There are very real dangers.
I hope that the Minister will be prepared to accept the amendment in the terms in which it appears in the Marshalled List. It is an extremely reasonable amendment. However, the important point about it is that such studies should be carried out and we believe that the Secretary of State should Commission them. In part the funding may come from the deposits that the Crown Estate has already collected from potential developers. My Treasury halo tends to emerge at this stage in the proceedings. More particularly, having reached this late stage in the process of round two proposals, it is essential that one does not go ahead with final consent until we are clear what effect wind farms will have on shipping. If one goes ahead without such clarification, particular licences may be granted to individual contractors and we may find that the dangers inherent in the effects of wind farms on navigation are greater than was believed.
There is much anecdotal evidence to be found from other countries, particularly Denmark or Holland, which already have considerable experience of ships passing near to wind farms. I frequently fly over the approaches to Rotterdam and perhaps some experience can be gained there. One also needs to look at the more specific problems before reaching a final conclusion. I stress that it appears to me that we must get on with this matter. It is extraordinary that we have not already taken this point into account, given that the Ministry of Defence, for example in relation to aircraft, clearly is concerned about the issue.
I am grateful to the Minister for his earlier response, but we have come to the point where clarification is needed. We need to do something to reduce the concern that has been expressed about such dangers. It is true to say that the environmental lobby is increasingly schizophrenic on this issue. While we would all like to see more renewable energy of the type produced by wind farms—I am not against them in principle—there is a problem: if ships have to make diversions or have to queue outside the approaches to ports, additional greenhouse gases may be produced that otherwise would not have been emitted by the vessels.
Against that balance, I see no evidence at all of the Government considering the balance between renewable energy generation and the increased pollution due to the diversion of ships. More particularly, there is a major danger of an environmental disaster in terms of a ship—perhaps a tanker—hitting such a set of obstacles with disastrous effect. Indeed, that might happen not only on one occasion but time and time again unless we are clear

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that the safety zones around them—and the location of them, in particular—are sufficient to ensure that ships are able to navigate safely past the wind farms.
This is an important amendment. I hope very much that the Government will sympathetically accept it. I beg to move.
Lord Greenway: My Lords, I support the amendment of the noble Lord, Lord Higgins. I accept his apologies—I think we will blame the mistake on the Recess—but I did have my name down to the amendment at Report stage.
I agree very much with what the noble Lord said. At Report stage, the noble Lord, Lord Davies of Oldham, gave an assurance that he would look further into the matter of interference with marine communications, electronics, radar and so on. I believe that this has already been put in train and that the MCA is carrying out initial "in-field" studies in the vicinity of the North Hoyle wind farm off the north of Wales. The Government have called for consultation with the marine industry—I believe that comments have to be in by the end of next week—and so matters are moving ahead.
One of the arguments that the Government may have against the amendment is that it may unduly delay the process of issuing licences. But if they are getting on with it as quickly as I take them to be, we can get round that problem. There is the added problem of looking into the materials that are used in the construction of the wind turbines. That may also be having an effect on radio communications. Furthermore, we have to look at the cumulative effect. This is important because the wind farms will be built seawards of existing wind farms and the possible very large cumulative effect could increase the risk to navigational aids.
I fully support the amendment. The Government are aware of the problem and I hope that they will look favourably on the amendment.
Lord Davies of Oldham: My Lords, I am grateful to the noble Lord, Lord Higgins, for the way in which he moved the amendment and to the noble Lord, Lord Greenway, for his remarks. As they will recognise, there is not a great deal of difference between the Government's position and the one advocated so ably by both noble Lords.
I gave an assurance at Report stage that the Government would carry out the study mentioned in the amendment, and we stand by that undertaking. As the noble Lord, Lord Higgins, emphasised, it is important that wind farms do not compromise safety by interfering to an unacceptable degree with ship communications systems. The point made in the amendment about search and rescue is of particular importance and well made. Time is often of the essence in search and rescue situations and communications systems obviously must be working to the highest standards in such circumstances.
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As the noble Lord, Lord Higgins, indicated, it is important that the Government should draw on international experience. We shall look at Denmark and, as the noble Lord suggested with great emphasis, the Netherlands, both countries having substantial numbers of wind farms in coastal areas. We can also use the offshore wind farm at North Hoyle as a test facility to provide an input into the study.
We see the study as a priority. Where it will go from the initial information-gathering phases is difficult to predict. However, I can assure the noble Lord that the effect of a wind farm on ships' communications systems will certainly be one of the issues which will need to be addressed when the developers of the round two offshore wind farm projects submit their applications for consent as part of the process of considering the impact on marine safety.
I want to give the noble Lord a further assurance that the Government will take into account all costs and benefits with regard to the proposal, so his point about the extra pollution caused by ships having to navigate around wind farms will be taken into account at that stage. That is a point properly made.
We have repeatedly made it clear that consent will not be granted when a wind farm presents a danger to navigation. We do not expect that the first applications for consent will be submitted until some months from now. That gives us a window in which to complete the study and to consider the outcome.
I hope, therefore, that the noble Lord will recognise that he has made his point. We accept the necessity for the study. We have time to do it, we will draw on international experience, and we will take into account all the factors that he and the noble Lord, Lord Greenway, brought to our attention. If I were pressed on the amendment, I could elaborate about technical difficulties. However, the noble Lord, Lord Higgins, and I are so close in empathy about what should be achieved with regard to action on the round two submissions that I hope he will recognise that I have moved as far as I can without directly accepting the amendment. On that basis, I hope that he will feel that he can take these assurances and will be prepared to withdraw the amendment.
Lord Higgins: My Lords, I thank the Minister for that reply. I am sorry that he cannot simply accept the amendment; I think it would be helpful to have it in the Bill. He has given no reason why he is unable to do so. It is therefore rather tempting to press the amendment to a Division and get it in the Bill, so that we know where we stand. However, I served my apprenticeship in another place under the late lain Macleod who, in the face of assurances of the kind which the noble Lord has given this evening, said that it was not the policy of the Opposition to shoot Santa Claus. That probably applies in this case. Therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 93 [Consents for generating stations offshore]:
Lord Higgins Lord Higgins moved Amendment No. 12:
Page 71, line 12, at end insert—
"() In section 36(1) of the 1989 Act (consent required for the construction etc. of generating stations) at the end of subsection (1) insert "and such consent shall only be given in relation to offshore wind farms after full consultation with representative bodies of marine users"."
The noble Lord said: My Lords, the amendment would provide that consent required for the construction and so on of generating stations shall be given in relation to offshore wind farms only after full consultation with representative bodies of marine users.
One reason why I have been so alarmed at the way in which these matters have been dealt with hitherto is the extraordinary way in which the Crown Estate in particular and other government departments seem to have pressed ahead in the way I described earlier without consulting the various shipping industries, Trinity House, port authorities, and so on. We are now at a very late stage—we are already through round one of the consultations and there seems to have been remarkably little involvement with interests that might be concerned with safety and navigation. Those sites have actually been given permission, with all the problems to which I referred, particularly the question of whether the ships have to go round the wind farms rather than the wind farms being put out of the way of the ships. The noble Lord, Lord Greenway, and others drew attention at an earlier stage to the very real dangers that could result if those interests were not taken fully into account.
There is also the problem, which has been mentioned in earlier debates, of our international obligations. I find the present ministerial structure overall somewhat puzzling. However, I almost wonder whether one should not appeal to the Deputy Prime Minister, Mr John Prescott, on these issues, considering his long-standing interest in shipping matters. But we really must ensure that these various interests are fully consulted before any further consents are given. I stress the word "consents", because we have already reached the stage at which a diagram has been published by the Crown Estate showing that it has allocated particular sites to particular contractors. However, within those sites there is still the question of the environmental aspects being taken into account and an environmental impact assessment eventually being made.
One thing that has concerned the outside interests is that they have previously not been given full information about what is happening on the grounds of commercial confidentiality, between the Crown Estate on one side and those responsible for the proposals for the development of a particular site on the other. Safety must come first as far as that is concerned. If there are specific proposals, the outside shipping interests should be consulted ahead of any final decision being made. I hope that the Minister will give us a satisfactory reply and assure us that all these
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problems will be dealt with in future even though unfortunately—and alarmingly in some ways—they have not been dealt with previously. I beg to move.
9 p.m.
The Duke of Montrose: My Lords, I offer my support to the noble Lord, Lord Higgins, on the matter of consulting fishermen's interests. During the recess, I was talking to a gentleman connected with the fishing industry. He remarked that, as far as he knew, the Government had not conducted any formal consultations with the fishing industry, which the amendment moved by the noble Lord, Lord Higgins, would require. Perhaps this is the time for that consultation to take place, but it would be reassuring to know that the Government were required to carry it out.
Lord Greenway: My Lords, I support the thrust behind the amendment, but I am bound to say that, as a result of what has already transpired at earlier stages of the Bill, the message has probably got through. There will certainly be much wider consultation with the marine industry for future rounds.
When one looks at the proposed sites for round 2, it is obvious that efforts have been made to try to position these offshore wind farms where they will not have too much effect on shipping. However, as the noble Lord, Lord Higgins, said, there are one or two glaring examples where they have been plonked in almost the worst possible place, where they could not affect shipping more—one in the Thames estuary and one off the Humber. Therefore there must be consultation with the interested marine parties before any licence to develop a site is given.
I take comfort from the fact that the Transport Select Committee in another place is due to examine the whole business of offshore wind farms on Wednesday next week, so further focus will be put on this matter. I support the thrust behind the amendment, but I feel that we have already stirred up enough interest in the subject for the amendment not to be necessary.
Lord Davies of Oldham: My Lords, the noble Lord, Lord Greenway, is right. Issues have been raised with sufficient force for the amendment not to be necessary. However, I wish to assure the noble Lord, Lord Higgins, who moved the amendment and the noble Duke, the Duke of Montrose, that all maritime interests will be taken into account. I very much agree that it is vitally important that there is full consultation with the representative bodies of marine users, including fishermen, before a decision is made to grant an application for a Section 36 consent. Best practice dictates that such consultation takes place and that is what happens in practice. I see no real need to formalise that process in legislation. I will try to illustrate how we are consulting. All applications for Section 36 consent for offshore wind farms must be accompanied by an environmental statement. The Secretary of State cannot grant a Section 36 consent unless the applicant has provided an environmental statement that meets the content requirement set out in regulation. The statement must

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include an assessment of the likely impact of the development on the environment, including direct and any indirect effects.
The aspects of the environment that must be taken into account are wide-ranging and cover not only the impact on the marine environment itself but users of the sea, such as the fishing community, to which the noble Duke, the Duke of Montrose, referred, recreational sailors, whose interests the noble Lord, Lord Greenway, has at heart, and commercial shipping, which the noble Lord, Lord Higgins, has always emphasised in his contributions to amendments tabled in the past.
A proper assessment of the impact of the proposal requires thorough consultation with all stakeholders with an interest. Developers who do not consult properly run the risk that when it is made the application will be rejected by the Secretary of State or Scottish Ministers as inadequate, or that stakeholders will lodge objections to the project. The developers who have been granted site options by the Crown Estate for the second round of offshore wind farms are at the beginning of the process of gathering information for their environmental assessments and preparing their environmental statements.
The department held a preliminary workshop on 12 March to bring together the developers with key government advisers. When a developer applies for consent under Section 36, he must publish notice of the application in local and national newspapers as well as in the London Gazette or, in Scotland, the Edinburgh Gazette. That process formally alerts all interested parties to the application.
It is therefore not necessary to formalise a requirement for consultation because all interested parties will be given an opportunity to make their views known to the Secretary of State or to Scottish Ministers before they take any decision on such proposals. It is clearly in the interests of the developer to undertake such consultations with marine users. Those who do not run the risk that their application may be rejected by Ministers on the basis of a failure to consult relevant interested parties, or may find that formal objections are made to the project.
The amendment focuses on consultation with representative bodies of marine users alone. I understand the proper concerns that the noble Lord has voiced on shipping matters, but the amendment could cause some confusion by giving the impression that consultation is required with marine users but not with other stakeholders. For example, a large number of environment groups have a clear and obvious interest in offshore wind farms.
I hope that I have indicated to noble Lords that we take consultation very seriously. The amendment is more limited than perhaps might be warranted by the number of stakeholders who have an interest in this matter. We intend that all stakeholders should play
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their part as appropriate in any application. On that basis, I hope that the noble Lord will feel that I have given him the assurances that he required.
Baroness Byford: My Lords, I believe that I heard the Minister say clearly that consultation happens in practice now. However, my noble friend the Duke of Montrose said that the fishermen had not been consulted. I wonder whether the Minister's remarks were relevant to the first wave or the second wave. If one of the major organisations feels that it is not being consulted, that cannot be happening in practice. If the Minister could give us an example, I would be grateful.
Lord Davies of Oldham: My Lords, it is of course the case that we are in the early stage. I can give the assurance that fishermen's interests are taken into account. In fact, they have been present at meetings with the DTI on the whole structure. The noble Duke, the Duke of Montrose, may have met a group of fishermen who have not yet been party to the discussions. It will obviously take some time for the issues to percolate down, particularly with regard to wind farms in particular areas of the country. I seek to indicate, in my admittedly rather general reply, that all those interests are being consulted, and we expect them to be consulted. We cannot conceive of the submission of any application that does not give evidence of the fact that stakeholders have been consulted.
Lord Higgins: My Lords, I am grateful to the Minister for that reply. The noble Lord, Lord Greenway, hit the nail on the head. The reality of the situation is that there was not adequate consultation, as far as one can establish, during round 1. It is really only since these matters have arisen on this Bill that there has been a more positive and active response by the Government regarding consultation. I think that noble Lords should be pleased that they have fulfilled a useful function in that respect.
I understand the point that the Minister made about the narrowness of the amendment. Clearly, it is important that all interested parties should be involved. I hope that environmental groups will take an active interest in the risk of a major environmental disaster compared with what one must say is a somewhat marginal benefit as far as concerns wind farms, given the problems of ship diversion and so on. I hope that they will take that point fully into account and make suitable representations.
I am still somewhat worried about the actual structure. Perhaps the Transport Select Committee in another place might look into this matter. The environmental statement is made by the developer, who clearly has an interest in producing a favourable environmental statement. That is why it is so important that other interests should be considered at an early stage. These interests—shipping, environment and so on—should be very clearly aware of what specific proposal is being made before the Minister considers whether it is appropriate.
The other point that I think is very important is that probably about half of the proposals in round 2 are in areas where a significant number of shipping movements

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take place and where the location of offshore wind farms could infringe Article 60 of the United Nations Convention on the Law of the Sea. We have not really stressed this point, other than to express concern about the extent to which the Government may be in conflict with their treaty obligations regarding international shipping. In that context, it is important that, in addition to the consultations that we have already discussed, and, as the Minister said, taking as widespread a view as possible, they should also be in touch with the International Maritime Organization, which is conveniently located within walking distance down the road. Its interest should be taken into account.
I do not propose to press this amendment to a Division. I hope that as a result of the debates that we have had on the Bill the Government are now aware that they were failing to consult adequately. We must express the hope that they will consult adequately in future. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Higgins Lord Higgins moved Amendment No. 13:
Page 71, line 12, at end insert—
"() After the passing of this Act, consents for generating stations offshore shall not be given to applications made under the provisions of the Transport and Works Act 1992 (c. 42)."
The noble Lord said: My Lords, this is a much more technical amendment and it is concerned with the way in which applications are made. As I understand it, it is possible for applications to be made under either the Transport and Works Act 1992 or the Coast Protection Act 1949. I also understand that under round 1 at least half of the farms in territorial waters have been given approval under the Transport and Works Act 1992, even though this tends to be a more expensive way of making an application than if it is done under the Coast Protection Act 1949.
The Transport and Works Act expressly excludes the requirement to obtain consents under the Coast Protection Act. However, unlike the CPA, it does not address dangers to navigation or safety of navigation. Instead, it allows the extinction of public rights of navigation where proposed installations interfere with those rights and could give rise to actions for nuisance.
Consequently, under the TWA, there is no statutory requirement for wind farms causing a danger to navigation to be addressed. The Maritime and Coastguard Agency will be asked to assess draft TWA orders from the safety of navigation perspective and the relevant General Lighthouse Authority may also be involved. However, there is no specific provision that is part of the legal process for giving consent. Therefore, if the Transport and Works Act is used, the important safety issues involved may not be taken into account and, indeed, are effectively avoided.
The absence of a statutory requirement in the TWA route is a serious weakness in the legislative machinery. Many of the possible sites may be in territorial waters. We therefore believe that it is important that future applications should be made under the Coast Protection Act rather than under the Transport and Works Act. The purpose of this
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amendment is to ensure that that is the case. In our view it is obviously wrong that it should be possible not to take into account fully the aspects that involve the safety of navigation. I beg to move.
9.15 p.m.
Lord Greenway: My Lords, I should like to support the amendment. I invited the Minister to respond to the matter on Report and he wisely declined that offer. The noble Lord, Lord Higgins, made an important point. There is no doubt that the Transport and Works Act is not subject to the same checks and balances as the Coast Protection Act in this regard. There is a definite lacuna in respect of there being no requirement to address the problems of offshore wind farms causing a hazard to navigation and therefore affecting safety. I very much support the amendment.
Lord Davies of Oldham: My Lords, I wish to give assurances to both noble Lords who have contributed to this short debate, but I also want to express a very powerful argument regarding why we cannot under any circumstances accept the amendment.
I begin with the assurances. The noble Lord, Lord Greenway, drew attention to the fact that I did not fully respond to these issues on a previous occasion. They are technical and I am not sure that I was fully equipped on that occasion to respond to the matter that he addressed. I am rather better equipped to do so today but nevertheless I am inevitably stuck with having to at least attempt to match the technical expertise that the noble Lord, Lord Higgins, has shown.
I believe that a misunderstanding of how navigational safety matters are taken into account under this legislation underpins the amendment. The DTI seeks the views of the Maritime and Coastguard Agency on all applications for a Transport and Works Act order that are made to the Secretary of State. The MCA has been consulted on all the offshore wind farm projects for which TWA orders have been granted so far. The MCA has not maintained an objection to any of those projects. Where the MCA gives its approval subject to certain conditions, such conditions would be taken into account in the TWA order and would be legally binding on the developer and enforceable in the same way as other provisions of the order. I can therefore give the categorical assurance that maritime safety is treated equally seriously whether the developer of an offshore wind farm seeks a TWA order or consent under the Electricity Act and Coast Protection Act. The same degree of concern about the maritime environment applies.
There is a further reason why the amendment would not be acceptable to us.
Lord Higgins: My Lords, my understanding is that the MCA involvement is not legally part of the consent regime under the TWA. The Minister seems to be contradicting that. One or other of us has been

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wrongly advised. Is he absolutely sure of what he says—that the MCA has the legal right to exercise a veto?
Lord Davies of Oldham: My Lords, I have indicated that the MCA has played its part on all approvals, and that the conditions that it imposes would then be taken into account. They would be legally binding on the developer and enforceable in the same way as the provisions of the order. I am in some difficulty if the noble Lord contends that his understanding of the law is different from mine. I cite it as accurately as I can; I warned the House that we were entering the deep waters of technicality on the amendment.
Let me put the other point to the noble Lord. I am sure that he will take it as seriously as I do, although I might have rather more atavistic reasons for doing so. His amendment would disapply the TWA and, as he will probably recall from an earlier debate, leave the Welsh Assembly Government in a very difficult position. The Assembly Government do not have powers under Section 36 of the Electricity Act, but are responsible for TWA orders for offshore wind farms in Welsh territorial waters. If we disapplied the TWA, as the amendment suggests, the Welsh Assembly Government would have no role in the consent process for offshore wind farms.
I am sure that the noble Lord would not want that to be thrust on the good people of Wales, who have legitimate concerns about the issues as well. At present, the TWA is their only power of defence on the matter. For that reason, I hope that he will accept my assurance on the need to withdraw the amendment.
Lord Higgins: My Lords, can Wales not use the Coast Protection Act 1949?
Lord Davies of Oldham: My Lords, as I understand the position, that is not as effective as the TWA. The TWA is the most effective measure, and the one that Wales has used to safeguard its interests. We have been discussing the TWA in relation to the operation of the Maritime and Coastguard Agency in consultations on all matters that have taken place thus far on wind farm proposals.
I recognise the difficulty that the noble Lord and I have if we are not totally agreed on the law at present. Obviously, I can stand only on the basis of the expertise available to the Government, and the practice that we have followed in phase one of the consents applied. The amendment would certainly leave our Welsh colleagues in real difficulty with regard to control of the situation.
Lord Higgins: My Lords, as has been said—if the House will forgive the analogy—we are in pretty deep waters. My understanding is that the Scottish position is protected. There is alternative legislation in the form of the Private Legislation Procedure (Scotland) Act 1936 and the Robin Rigg Offshore Wind Farm (Navigation and Fishing) (Scotland) Act 2003. I am deficient in advice on the situation in Wales. While I
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would not regard that as an overwhelming problem, as it could be put right, if necessary, on Report, we are left with a situation where we appear to have conflicting legal views on the issue. On these occasions I look hopefully in the direction of the Box—although I am not sure that I should talk about the people in it as they do not exist in terms of the House.
Lord Davies of Oldham: My Lords, it might just be possible for once, that the Box has complete confidence in the Minister.
Lord Higgins: My Lords, I do not even have a box. The Minister has been forthcoming all evening. My initial inclination was to press the amendment to a Division, but that would be difficult when there are conflicting views. We need to be clear, with the good will of the Minister, that if, by chance, he turns out to be wrong and I am right, then it is vital that this matter is raised in another place, the situation clearly explained and the matter resolved.
Obviously, we do not wish to have consents given without the legal position being clear with regard to essential navigational safety considerations or the risk of environmental disaster not being fully taken into account. I hope that all future applications are made in the manner that I have advocated, rather than a roundabout route that presents problems. So, relying on the Minister's good faith that this matter will be clarified—and, no doubt, he will write to us in detail— I shall not press the amendment, although I am tempted to do so. I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Clause 95 [Safety zones around renewable energy installations]:
Lord Davies of Oldham Lord Davies of Oldham moved Amendment No. 14:
Page 73, line 35, leave out "(b)" and insert "a safety zone"
The noble Lord said: My Lords, in moving Amendment No. 14, I shall also speak to Amendment No. 51. They are drafting amendments relating to safety zones. They do not alter the meaning of the provisions but merely serve to make the text clearer. I beg to move.
On Question, amendment agreed to.
Clause 106 [Interpretation of Chapter 1 of Part 3]:
Lord Whitty Lord Whitty moved Amendment No. 15:
Page 82, line 26, leave out "a renewable energy" and insert "an"
The noble Lord said: My Lords, this amendment and Amendment No. 16, are technical and set out the definitions of the various clauses. They amend the references to simplify the drafting of the Bill. I beg to move.
Baroness Miller of Hendon: My Lords, I agree that these are simple changes, but can the Minister assure us that an installation will, for the purposes of the Bill,

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cover renewable energy installations as well as other energy installations? If he could do so, I would welcome the amendments.
Lord Whitty: My Lords, yes. The references are contained within the provisions, where the terms "construction" and "decommission" are also used. So, it is not necessary to double-up on the definitions.
On Question, amendment agreed to.
Lord Davies of Oldham Lord Davies of Oldham moved Amendment No. 16:
Page 82, line 35, leave out "a renewable energy" and insert "an"
On Question, amendment agreed to.
Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 17:
After Clause 121, insert the following new clause—

MERGER OF RENEWABLES PAYMENTS FUNDS
In section 32C of the 1989 Act (payment as alternative to complying with order under section 32), after subsection (3) insert—
"() The system of allocation must pool the sums received in respect of supply in all parts of Great Britain and may not distinguish between evidence presented under section 32(3) (obligation in connection with electricity from renewable sources) in relation to England and Wales and such evidence presented in relation to Scotland.""
The noble Baroness said: My Lords, the amendment is intended to require the Secretary of State to pool the renewables buy-out funds in England and Wales on the one hand, and Scotland on the other. Figures recently published by Ofgem have shown that the current system is open to manipulation through the creation and subsequent gaming of material differences in the value of renewable obligation certificates—or ROCs—between the different buy-out funds. For example, a supplier with a large market share in Scotland has been able to under-present ROCs in Scotland, thus inflating the value of the remaining ROCs presented there, and then to use the ROCs that he did not present in Scotland to secure extra revenue by presenting them in England and Wales.
Such a practice constitutes an unfair distortion of trade between industry participants. It also creates unnecessary volatility in the ROC market to the detriment of the achievement of the Government's renewable objectives. Merging the funds is clearly the appropriate way to prevent these difficulties. It can be done without any detriment to consumers and would be a demonstration of the Government's commitment to secure the integrity of the renewables market. It is also something which needs to be addressed urgently, as the failure to correct the problem continues to distort the market.
We know that evidence of the manipulation which I mentioned has been given to government officials. They are aware of the problem. It is therefore time for action to deal with a real problem. I beg to move.
9.30 p.m.
Lord Davies of Oldham: My Lords, I appreciate the way in which the noble Baroness moved the amendment and also the concern that lies behind it: the prevention of any possible gaming by a dominant supplier in one market. That would be fulfilling its obligation in one country by using ROCs while meeting the other, in which it commercially dominant, mainly through paying the buy-out. If that were to happen, such a supplier would reduce the amount of buy-out recycled to its competitors in the market where it complied using mainly ROCs while maximising the amount of buy-out fund available for recycling in the other market. It will be recognised that this is a serious matter. I assure the House that we are keeping a close eye on it. Indeed, we recently received a representation on just this point, and we shall be examining the need for action with Ofgem.
I would emphasise that the issue of a pooled buy-out fund for Great Britain is a key one for the forthcoming review of the renewables obligation. But before decisions can be taken, we need to consider the effect on consumers in the constituent parts of Great Britain, how great these effects would be and how to encompass the new renewables obligation planned for Northern Ireland.
In the meantime, it would be premature, to say the least, to move forward with this amendment when we have not yet carried out a detailed analysis of the effect of such a move on consumers. It is very important that we take the time needed to consider its effects in the round, not merely implement the measure with a limited grasp of the full effects.
Should the amendment come into force at the same time as the rest of the Bill, it would affect the obligation period for 2003–04 for which any payments into the buy-out fund are due on 1 October this year. Suppliers may choose to make their payments before that date. If the amendment were to come into force around late September, that would leave open the distinct possibility of some suppliers deciding to comply early under the existing system and others complying under the new system. To put it at its mildest, that would be a confused and highly undesirable situation.
Furthermore, the amendment would have serious consequences for powers that have previously been executively devolved to Scotland. Fully to achieve the purpose of the amendment of having a single buy-out fund will probably mean the introduction of a single Great Britain-wide obligation, rather than the two obligations we have at present. Taking powers back to Westminster that have already been executively devolved is no light or casual matter.
Therefore, although I feel obliged to resist the amendment, I want to emphasise that we are giving the most careful consideration to this issue in the review of the renewables obligation. It would be possible to take measures that would meet the purpose behind the amendment using secondary legislation and without the need to pull back powers which we have already devolved to Scotland. With a firm undertaking that the issue will be considered fully in the review, and in view of our real awareness of the seriousness of the position,

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as the noble Baroness indicated in moving her amendment, I hope that she will feel able to withdraw the amendment.
Baroness Carnegy of Lour: My Lords, before the noble Lord sits down, of course none of us wants cheating in the system, but it is very nice to hear the noble Lord defend the interests of Scotland in so far as matters have been devolved hitherto. There could be a distortion in the system if a measure such as that proposed by my noble friend—I know that she has done so in very good faith—was introduced at the wrong moment. Therefore, personally I very much welcome the noble Lord's reply and I am grateful to him.
Baroness Miller of Hendon: My Lords, I am grateful to the Minister for saying that evidence has been given about this manipulation and that it is a very serious matter which needs to be considered. I shall make only one or two comments. I said very clearly that this proposal could be implemented without any detriment to consumers. That is what the organisation that briefed me strongly on the need for the amendment made very clear. I was surprised to hear the Minister say that we must look into what its effect would be on consumers on the basis that nothing has been done until now.
I heard what my noble friend Lady Carnegy said on this issue and I understand her views clearly. However, the fact remains that at present the system is simply not working. In fact, it is continuing to distort the market and will continue to do so unless something is done about it.
I believe I heard the Minister say that somehow or other this matter can be dealt with by secondary legislation. I wonder how a certain matter can be devolved and then, in a sense, corrected by secondary legislation. Unless I did not hear the noble Lord correctly, it seemed to me that that was the gist of his comments. I want to make it clear that at this stage I have no intention of dividing the House. As the Minister said, the Government take this matter seriously, but I simply want an assurance that they will make an effort to see that it is dealt with in the other place. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 18:
After Clause 122, insert the following new clause—

COMPLIANCE WITH SECTIONS 32 TO 32C OF THE 1989 ACT
(1) In section 25 of the 1989 Act (orders for securing compliance), in subsection (8), in the definition of "relevant requirement" for "32C" substitute "32D".
(2) In sections 32A(4) and 32A(7) of that Act (orders under section 32: supplementary), (which relate to information powers and other functions of GEMA), at end insert "or to any obligation arising under section 32D"
(3) After section 32C of the 1989 Act, insert—

32D Prevention and remedying of default in compliance with sections 32 to 32C
(1) An order under section 32 may provide that an electricity supplier must pay such a sum to the Authority, corresponding to the supply of a given amount of electricity by the supplier in a particular period, as may be—

(a) necessary to make good in aggregate so much of any unrecovered default in the payments referred to in section 32C(1) (payment as alternative to complying with order under section 32) by other suppliers in previous periods as may be determined by or under the order; and

(b) determined by the Authority and published at least so long before the start of that period as may be specified in the order;

(2) Any sums received under subsection (1) shall be paid by the Authority to electricity suppliers in accordance with a system of allocation specified in the order.
(3) The system of allocation specified in the order may provide for payments to specified categories of electricity supplier only.
(4) Where the Secretary of State is satisfied that it would be proportionate to do so, and that competition in the supply of electricity would not in consequence be unduly distorted, the order may also make provision as to the form and extent of any measures which a supplier is to take for the purpose of securing its discharge of the renewables obligation.
(5) Without prejudice to the generality of subsection (4), such provision may—

(a) apply only to so much of the obligation as may be determined by or under the order;

(b) include a requirement on electricity suppliers to deposit from time to time with the Authority sums of money. certificates issued under section 32B (green certificates), or other financial security; and

(c) authorise the payment of interest by the Authority on any sums so deposited.

(6) The order may provide that any figures necessary to make or provide for the derivation of any calculation under this section can be estimated by the Authority or the Secretary of State.
(7) This section is without prejudice to the enforcement powers available to the Authority in relation to any provision of section 32 (obligation in connection with electricity from renewable sources) to 32D that is a relevant requirement within the meaning of section 25(8).""
The noble Baroness said: My Lords, I feel like saying, "Here we go again", because I raised this issue in Grand Committee and at the Report stage. On Report, the Minister brought forward amendments relating to the handling of late payments and allowing for shorter obligation periods. However, those would have only the most marginal impact in dealing with the central problem of what happens when a supplier becomes bankrupt. Noble Lords may remember that when I discussed this matter in Grand Committee and on Report I called it "securitisation" on the first

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occasion and then argued the case equally for "mutualisation", hoping that somewhere along the line a solution could be found.
However, I think it is right to say that, in the absence of further action on this problem, we estimate that the failure of a company of the size of, for example, TXU could, by 2015, lead to a default 10 times bigger than that which arose last year from TX U's bankruptcy.
Such a risk is bad not only for the growth of renewable energy; it is also extremely bad for customers. They are paying extra for their electricity in order to secure the development of renewable energy, but a significant part of those payments is not flowing to renewable generators, simply because of the default risk.
We put forward on Report an amendment, which was designed to resolve that by giving the Government powers to implement either or both of the only two effective ways to deal with the problem. The first was for any uncovered cost to be recovered from consumers as an adjustment to future renewable charges. The second was for the amount of outstanding debt to be reduced through staged payments or by the provision of security.
Either route would involve some cost for consumers, and it is not clear at this stage which of the two would be cheaper. A combination may very well be the best answer. However, both would clearly be a more efficient use of consumers' money in support of renewables than the current system.
The Minister made a number of technical criticisms of our drafting on Report. We have accordingly taken note. 'We have simplified the amendment and made it more flexible. We have added safeguards to prevent undue distortion of competition. Discussions have been held within the industry in the light of the revised drafting. I am pleased to tell the House, and indeed the Minister, that the consensus that this amendment is the right way forward has been considerably strengthened since the issue was discussed.
On Report, I invited the Government to come back with their own proposals. I think I was a little ruder; I used language like, "Get on with it", which was not terribly parliamentary. I am trying to be more parliamentary at this stage. It did not prove possible, perhaps as a result of the time pressures. But inaction is simply not an option on this matter. It would be absurd to maintain a system with sums of this magnitude owing between commercial entities without any credit management.
The amendment does not commit the Government to specific action but it gives them the powers they need to take the matter forward. Tonight really is our last hope. I invite the Government either to accept our amendment, which is a serious and thought-through policy to resolve this serious problem, or to undertake to take the matter away, perfect the drafting if they think they can and bring it back in another place. I beg to move.
9.45 p.m.
Lord Davies of Oldham: My Lords, the noble Baroness, Lady Miller, has presented these issues both on Report and again today with considerable insight and tenacity. Of course I share with her the concern which lies behind the amendment. I hope that the powers in Clause 117 of the Bill demonstrate our determination and commitment to take measures to address the issue. I shall attempt before I have completed what I think will be a fairly lengthy reply in the face of these real difficulties, to give a positive response by the Government on how we propose to tackle the measure.
I am not sure that it is possible to prevent suppliers defaulting in their payments to the renewables buy-out fund as we cannot prevent companies failing, although clearly we should take all reasonable steps to reduce that likelihood. But all forms of protection for the buyout fund involve additional costs and we have to consider carefully the balance of costs and benefits. While the measures set out in the amendment would no doubt provide some additional security for the buyout fund, and in doing so may increase confidence in the market, it would do so—and I emphasised this the last time we debated the issue—at a high cost. There may be additional unforeseen consequences.
I recognise the hard work that has been done by the Opposition, and particularly by the noble Baroness, Lady Miller, in her attempts to produce amendments which tackle this very difficult issue. I want to emphasise that although I shall ask her to withdraw the amendment this evening, we are at one with her about the need to tackle the problem. We are trying to strike the right balance on how the problem can be most effectively tackled.
The amendment essentially covers two options: first, what is termed mutualisation, which is aimed at recovering a shortfall after it has occurred; and, secondly, securitisation, which involves taking steps to prevent such a shortfall occurring. In that context, it may be worth spelling out what we mean by shortfall or deficit in that context. Deficits are in fact lower amounts than expected being paid to holders of ROCs, rather than actual deficits in the usual sense of the word.
Let me address mutualisation first. The first provision in the proposed order requires that electricity suppliers must, in effect, make good previous shortfalls by paying an additional sum over and above their share of the renewables obligation. I am glad that the provision provides for sufficient flexibility so that any such additional sums can cover part or all of the shortfall, as I think that we are all agreed that the default of a very small supplier should not trigger mutualisation. That would mean taking a sledgehammer to crack what is really a small nut. That may also serve to limit the impact of the provision, but it will still mean extra costs. From where is the additional money meant to come? I fear that the only credible answer is that it will have to come from consumers—who are in no way to blame for the

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shortfall. Is the noble Baroness suggesting that it is right that consumers should foot the bill for such costs?
We have always made it clear—including in the energy White Paper—that our renewables targets are subject to the costs being acceptable to the consumer. To require consumers ultimately to fund deficits in the buy-out fund subjects them to an ever-increasing liability for costs. We should not depend on consumers to bear the cost of such shortfalls.
There must also be some doubts as to whether the amendment would achieve its basic aim of providing a greater level of confidence in the renewables market. There are two possible difficulties. First, the amendment may actually increase uncertainty. Following the failure of a supplier, other suppliers will not know the extent of the additional payment that they will have to make, but they will have that threat hanging over them. That level of uncertainty, together with the prospect of additional costs may, far from increasing confidence for investors, have the diametrically opposite effect.
Secondly, we need to look at the slightly longer term here. When a shortfall occurs, the requirement to make up all or part of the lower than expected fund will inevitably place further pressure on other suppliers. There must be a risk of a further shortfall the following year—the noble Baroness expressed anxieties on that score—consequential to the initial shortfall, and, as a result, greater demands for payments. In fact, we might have a domino effect, and we could be worse off than ever.
In practical terms, that provision of the amendment also involves at least one clear practical problem for Ofgem in determining the amount necessary to make good any shortfall. It is not clear on what basis Ofgem would do that. What would be the extent of any shortfall? There seems to be no legal remit to do that. We should also bear in mind that adding such levels of complexity will inevitably increase the administration costs for all parties.
Under the amendment, an order could also require electricity suppliers to take other measures to secure the buy-out fund where the Secretary of State is satisfied that that will not unduly distort competition—that is the securitisation element. I am glad that the noble Baroness, Lady Miller, acknowledged the implication for competition between suppliers making regular payments on account to cover their share of the renewables obligation. As I understand the provision, that is an attempt to secure some or all of each supplier's share of the obligation in advance. Again, that would certainly provide security but at a high cost.
The proposal increases the upfront costs on electricity suppliers, and there must therefore be a strong risk that those extra costs will fall on consumers. In some respects, that is a greater risk than under the previous provision because with this proposal the additional costs apply whether or not there is a shortfall.
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Unlike mutualisation, the Secretary of State cannot wait until a failure occurs before introducing securitisation. It can therefore be likened to an expensive insurance policy—with all insurance policies the cost will depend on the party seeking the cover, with larger, well-established companies tending to have to pay proportionately less. But, as I have just said, I welcome the fact that the amendment recognises and seeks to address the competition implications, which are considerable. How easy that would prove in practical terms—in other words, whether such a scheme can be devised that does not bear more heavily on smaller suppliers and does not act as a barrier to entry into the market—is another question.
I also have concerns about how such advance payments will be calculated, and how the suitability of other forms of financial security, such as letters of credit, will be assessed. That seems to be a potential minefield with ample scope for disputes and challenges. Although the intention, as I understand it, is that the amendment in effect offers the possibility of mutualisation and/or securitisation to protect the buyout fund, the wording is wide, referring to an order to make provision for any measures on the part of the supplier where the Secretary of State is satisfied that it is proportionate, and that competition will not be unduly distorted. Although the Government appreciate that concept of flexibility, the wording would give a very wide power, with consequent difficulties for Ofgem in assessing whether or not suppliers had made the necessary provision. The regulator cannot be made responsible for ensuring that shortfalls are avoided, which is an impossible task in a market-driven mechanism such as the renewables obligation.
I shall summarise why the Government resist the amendment. First, there are the potential additional costs, which are likely ultimately to fall to consumers; secondly, because there is some risk that such measures could make matters worse, although I accept that the noble Baroness's intention is to improve things; and, finally, because of the practical difficulties in implementation, in particular for Ofgem. In indicating in this protracted reply why we cannot accept the amendment, I emphasise that the Government are neither complacent nor pretending that a further shortfall could never happen. We are concerned that we could be taking powers that make matters worse rather than better whether or not a shortfall occurs. It must be open to question whether the additional costs, in financial terms and impediments to market entry, are justified.
The Government are concerned to provide some additional measures to help secure the renewables buyout fund. There is a trade-off between achieving a very high level of security while keeping costs to consumers at a reasonable level. For that reason we are examining closely the option of reducing the compliance periods thereby reducing exposure by other suppliers if a supplier were to go into administration. There are added administrative costs for both suppliers and Ofgem in the proposal, but we consider that it is

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preferable overall to the level of regulation proposed in the amendment. It also strikes a better balance between effectiveness and costs.
We intend to consult this summer, with a view to taking forward the necessary secondary legislation next year. We have already agreed the primary powers for this measure; they are in Clause 117, which, I think the noble Baroness will recognise, is a base on which the issue can be tackled. But we need to get it right. If we produce a remedy that does not measure accurately the costs and benefits, we could end up in a situation even worse than the problem that we propose to tackle. The noble Baroness has assiduously devoted many hours in approaching the matter. She has twice tabled amendments of great importance, which, although I have felt obliged to reject, have prompted us to think very seriously about the issue and how we should respond to it.
Baroness Miller of Hendon: My Lords. the Minister warned us at the beginning that his was going to be a long answer. Indeed, it was long, but it did not say anything that we wanted to hear. He need not have bothered. It was an appalling answer, because the Minister did not take note of many of the things that I said. There was no point in talking at length about how securitisation might work, or how mutualisation might work, or being flexible. I have argued those, both in Committee at great length and on Report at great length, and I know the pluses and minuses. We did not need to hear all of that.
The last time that we spoke, the Minister said that this would be taken away, and that they were consulting. They have been consulting; they have been consulting; they have been consulting. They cannot even get around to saying that they would be prepared to put something down at some stage during the course of the life of this Bill, when it reaches the other place. He did not take note, he said that it was an enormous cost to consumers—I mentioned that. I said that either route would involve some cost, but that it was not clear to us which route would be the cheaper, and a combination of both might be the answer. Whatever it would be, it would clearly be a more efficient use of consumers' money in support of renewables than the current system, which is absolutely appalling.
This new amendment could be called the middle way—which I would have thought suited the Minister's party. One might have thought that this might be an approach that could be helpful. It so happens that lots of discussions have been held with industry in the light of revised drafting, and the consensus on the amendment, so far as industry is concerned, is that this is the right way to move forward.
I am well aware that the Government have had a strong whip, and they have said that Members must stay until half past ten. I am going to give the Minister some relief that people will not feel that they stayed for nothing. They will at least have a chance to walk through the Division Lobbies. I wish to test the opinion of the House.
9.57 p.m.
On Question, Whether the said amendment (No. 18) shall be agreed to?
Their Lordships divided: Contents, 38; Not-Contents, 68.

Division No. 5

CONTENTS

Addington, L.

MacGregor of Pulham Market, L.

Astor of Hever, L.

Attlee, E.

Maddock, B.

Byford, B.[Teller]

Mancroft, L.

Carlisle of Bucklow, L.

Mar and Kellie, E.

Carnegy of Lour, B.

Miller of Hendon, B.

Cope of Berkeley, L. [Teller]

Montrose, D.

Craigavon, V.

Newton of Braintree, L.

Cumberlege, B.

O'Cathain, B.

Dixon-Smith, L.

Palmer, L.

Ezra, L.

Pearson of Rannoch, L.

Geddes, L.

Greenway, L.

Russell, E.

Harris of Richmond, B.

Sharp of Guildford, B.

Higgins, L.

Shutt of Greetland, L.

Hooson, L.

Steel of Aikwood, L.

Howe, E.

Wade of Chorlton, L.

Kingsland, L.

Wakeham, L.

Laird, L.

Williams of Crosby, B.

NOT-CONTENTS

Acton, L.

Harris of Haringey, L.

Alli, L.

Hilton of Eggardon, B.

Amos, B. (The Lord President of the Council.)

Hollis of Heigham, B.

Howells of St. Davids, B.

Andrews, B.

Hughes of Woodside, L.

Ashton of Upholland, B.

Hunt of Kings Heath, L.

Bach, L.

Jones, L.

Bassam of Brighton, L.

Judd, L.

Blackstone, B.

Layard, L.

Borrie, L.

Lea of Crondall, L.

Brooke of Alverthorpe, L.

Lipsey, L.

Burlison, L.

Lofthouse of Pontefract, L.

Campbell-Savours, L.

Macdonald of Tradeston, L.

Carter, L.

McIntosh of Haringey, L.

Chan, L.

McIntosh of Hudnall, B.

Crawley, B.

Massey of Darwen, B.

David, B.

Pitkeathley, B.

Davies of Coity, L.

Puttnam, L.

Davies of Oldham, L. [Teller]

Ramsay of Cartvale, B.

Desai, L.

Rooker, L.

Dixon, L.

Sainbury of Turville, L.

Donoughue, L.

Scotland of Asthal, B.

Dubs, L.

Simon, V.

Evans of Parkside, L.

Smith of Leigh, L.

Evans of Temple Guiting, L.

Stone of Blackheath, L.

Farrington of Ribbleton, B.

Symons of Vernham Dean, B.

Filkin, L.

Taylor of Blackburn, L.

Gale, B.

Triesman, L.

Gibson of Market Rasen, B.

Turnberg, L.

Golding, B.

Warner, L.

Goldsmith, L.

Warwick of Undercliffe, B.

Gordon of Strathblane, L.

Whitaker, B.

Gould of Pottemewton, B.

Whitty, L.

Grocott, L. [Teller]

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
10.7 p.m.
Lord Ezra Lord Ezra Amendment No. 19:
After Clause 126, insert the following new clause—

RENEWABLE TRANSPORT FUEL OBLIGATION
(1) In order to comply with EU Directive 2003/30/EC, which requires Member States of the European Union to demonstrate how biofuels are to be placed on their markets in increasing quantities, the Secretary of State may, by regulations, introduce a renewable transport fuel obligation.
(2) Regulations made under subsection (1) may—

(a) require relevant parts of the road transport fuel industry to demonstrate that a specified proportion of their product is renewable,

(b) set targets for the proportion of road transport fuel to be renewable, and

(c) provide for penalties for failure to meet targets.

(3) For the purposes of the obligation, renewable transport fuels shall be defined as liquid or gaseous fuel for transport produced from biomass or other renewable fuels.
(4) The power conferred by this section on the Secretary of State to make regulations is exercisable by statutory instrument subject to affirmative resolution of both Houses of Parliament.
(5) In this section—
"biomass" means the biodegradeable fraction of products, waste and residues from agriculture (including vegetable and animal substances) forestry and related industries, as well as the biodegradeable fraction of industrial and municipal waste;
"other renewable fuels" means fuels, other than biofuels, which originate from renewable energy sources and are used for transport purposes."
The noble Lord said: My Lords, this amendment deals with the renewable fuel transport obligation. Like the previous matter, this subject was discussed in Committee and on Report. On both occasions, the noble Lord, Lord Whitty, expressed sympathy with the intent of the amendments, but he thought that they were too precisely drawn. Full account has been taken of his remarks in drawing up the present amendment, which begins by referring to the EU directive and then leaves it open to the Secretary of State to make such regulations as may be required in relation to that directive. I do not think that anything could be more broadly drawn than that.
I hope, therefore, in the light of the real effort that has been made and the discussions which I know have taken place since the Report stage, that the Minister will be prepared to accept the amendment. It should be borne in mind that when the Bill goes to another place, if for any reason a further amendment is made, obviously that would be possible. If necessary, we would be able to consider it again when the Bill comes back to us. On that basis, and speaking briefly given the hour, I beg to move.
Lord Palmer: My Lords, as usual the noble Lord, Lord Ezra, has given a most succinct introduction to this, our third attempt at trying to persuade Her Majesty's Government to have a renewable transport fuel obligation. As the noble Lord said, an enormous amount of work has gone into the rewording of this amendment since we originally tabled it with all-party support in Grand Committee, where it even seemed to receive tacit support
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from the noble Lord, Lord Whitty. As always, I must declare an interest as the unpaid president of the British Association for Biofuels and Oils.
It is terribly difficult to find anything new to say on this amendment as the arguments were so well supported in Grand Committee and from all parts of the House at Report stage.
The noble Lord, Lord Dixon-Smith, emphasised the point that if this amendment was accepted we would be talking about a minute percentage of our total fuel requirements, and I think that this is indeed an important factor. Although the amounts of biofuels potentially available may be relatively small, they could nevertheless be significant—5 per cent is certainly achievable; and 10 per cent is a realistic target over time.
For a brief moment I would like to reiterate some of the salient points behind our thinking on this amendment. This amendment could make a major step forward in achieving our national aims for cutting CO2 emissions. It would improve local air quality. It would boost the productivity of our depressed farming sector at an affordable cost. It would give the United Kingdom a degree of self-sufficiency. Surely this must be welcome in the current political unrest in the Middle East. It would make certain that we try not to lag too far behind our European partners, who are currently way in advance of us in terms of technology, usage and of course most importantly, enjoy a much more relaxed tax regime.
I have seldom been involved in a Bill where one particular amendment has such overwhelming support throughout the land, not least of all from another place. The Daily Telegraph recently ran a headline:
"Whitehall warms to 'fuel from crops' initiative".
Only last week, there was a major editorial in Crops Magazine, and I quote:
"The energy time bomb is ticking as predictions for depleting fossil fuel reserves in the North Sea and elsewhere suggest. Government has a real chance to provide the UK with sustainable energy alternatives".
Every countryside body supports this amendment; every farming body supports it; every environmental body supports it, and not surprisingly, all the farming press support it. I really hope that the Government, this time, will embrace this with open arms as it really will be of enormous benefit to our nation.
Lord Carter: My Lords, I have put my name to this amendment because I have been involved in Grand Committee and at Report stage. As the Minister knows, we have been trying extremely hard to find an amendment that the Government will find acceptable. Like the noble Lord, Lord Palmer, I declare an interest as the unpaid vice-chairman of the British Association for Biofuels and Oils.
In this amendment we have tried to meet the points that have been made by the Minister. We have included the other renewable fuels and biodiesel. We know that the Government are consulting and when that consultation is over they will have to produce their

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proposals to meet the directive, which has been mentioned. This amendment provides them with a way of doing that.
I have two quotations. When we discussed this matter at Report stage the Minister said:
"I am open to discussing any alternative amendment that the noble Lord, Lord Carter, or anyone else, brings forward. But anything which appears to drive the Government to one conclusion on this matter would be somewhat difficult. With that qualification, I shall be happy to talk to anybody".—[Official Report, 29/3/04; cols. 1094–95.]
We drafted the amendment expressly so that the Government are not drawn to any one conclusion. I also have a letter from Mr John Healey, the Treasury Minister, to Mr Peter Clery, the chairman of BABFO, which states that,
"the Government remains committed to promoting biofuels, and we are not opposed in principle to some form of biofuels obligation for road transport as this may well offer an effective way of promoting further use of biofuels in the UK. Although we must weigh up the merits of such an approach against other possible options, it could be one of a number of options to help the UK meet the targets we need to set under the Biofucls Directive".
We have drafted the amendment exactly to meet the points made in that letter.
There is one point that has not been raised before and which we believe is important. When the Government reach the end of the consultation and decide to introduce a policy on renewable and transport fuels, how will they do so unless a provision of this nature is somewhere in legislation? I am not clear that they will be able to do so even if they wanted to. I agree that if the Government accept the amendment, it could mean substantial redrafting in the Commons. It is important that there is a provision in the Bill so that if the Government wish to introduce the policy, they have the power to do so. It would be helpful if my noble friend could tell the House, should he decide not to accept the amendment, how the Government would be able to introduce such a policy.
This is the first House to consider the Bill. There will be every opportunity in the House of Commons for the Government to amend and improve this approach if they wish. The amendment is entirely permissive; it does not tie the Government's hands. I hate to say it, but it leaves the Government with the option not to do anything if that is what they choose to do. We, of course, shall be lobbying hard for biofuels as an alternative to be accepted, but the amendment does not tie the Government's hands; it merely provides a means, through legislation, for the Government to act if they wish to do so.
I hope that my noble friend the Minister will be able to accept the amendment as drafted. Then, if the Government wish to amend the drafting or whatever in the House of Commons, they will be free to do so.
10.15 p.m.
Lord MacGregor of Pulham Market: My Lords, I shall speak very briefly and follow the good example of others who have spoken before me in so doing. I declare an interest, as I have in earlier debates, as a non-executive director of Associated British Foods, which owns British Sugar.
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But it is because of the wider considerations that I support the amendment. I wish to draw attention to the point made very briefly by the noble Lord, Lord Palmer, about its impact on agriculture and the farming community. Indeed, the Minister has been extremely sympathetic all the way through in his response to the general approach. It has been generally agreed on all sides for some considerable time now that one of the ways forward for the farming community is diversification, alternative land use and alternative use of crops. It seems to me that this classically falls into this category.
Given the fact that the sugar regime is due to be amended from 2006 onwards, the possibilities for oilseed rape, for sugar beet, in particular, and for other cereals give farmers considerable cause for hope. I speak as one who comes from a part of the country which has a very strong cereal and sugar beet growing industry. That is one reason why I support the amendment.
The noble Lord, Lord Carter, made a very good point about the legislative opportunities for introducing this subject if it is not done here. If it requires legislation—as I suspect it will—as a small item it is the kind of thing that will get dropped out and not be brought forward as part of a government Bill unless there is another wider opportunity to include it. Here is this wider opportunity. I hope that it will be taken.
Baroness Byford: My Lords, I support the thrust of the amendment. I hope that on this occasion the Government will be able to accept it. As the noble Lord, Lord Carter, said, if they cannot accept the wording of the amendment, perhaps they will accept the thrust behind it and come back with something in another place.
I do not have to declare an interest with regard to BABFO but we do grow sugar beet on the farm in Suffolk.
Looking back on our debates, I should be grateful if the Minister, if he is able, would respond today to the question raised by the noble Lord, Lord Tombs, at Report stage. The noble Lord said that the Minister had commented that,
"it is difficult to tax or apply obligations to overseas-owned companies"—
and asked—
"Does he accept that in the electricity renewables obligation we do just that with the French, German and American-owned companies operating in this country?".—[Official Report, 29/3/04; col. 1094.]
I would be glad if the Minister could respond to the noble Lord's question because I have not yet seen a reply.
Other noble Lords have covered the issue in great depth and I shall not delay the House. The Minister has indicated his sympathy all the way through. I believe the trouble has been with the purse strings in the Treasury. We may get a fuller explanation today. I hope that we will hear something positive as this is the last stage at which we in this House can do anything about it.

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I am grateful to the Minister and to all noble Lords, who have worked so thoroughly behind the scenes between the various stages. The workings of the House are very important because not everything happens on the Floor of the House; a great deal of pressure is exerted and discussions go on behind the scenes between the various stages.
In supporting the amendment I hope that, if the Government cannot accept it, they will make a strong commitment to the House to look at the issue again before the Bill completes all its stages in another place.
Lord Whitty: My Lords, as I think the House knows—certainly those participating in this debate know it—I have been a strong supporter of biofuels making a contribution to our climate change programme through transport and also as an outlet for the agricultural sector. The biofuels directive, which we very much welcome, gives us the opportunity to look afresh at mechanisms whereby we can deliver a higher proportion of our fuels through biofuels, preferably biofuels which are produced from crops of various sorts grown in this country.
Clearly there is an obligation on us to consult on how we will deliver the biofuels directive. The Department for Transport will be issuing a consultation document on that very shortly. One mechanism that it will propose as an option will undoubtedly be the imposition of a renewables obligation of the sort outlined in the amendment. There will also be other options, but the renewable fuels obligation would be part of that approach and one of the major options to be put before the consultees.
I am gratified that the amendment before us tonight is not the prescriptive amendment that it was at earlier stages, but is more permissive. There are a number of problems about the amendment as it stands. For example, how would it operate in practice? To whom would the obligation apply? What fuels would be covered? How should the scheme be policed and administered? How would companies demonstrate compliance? What would the information requirements be? Would there be buy-outs and trading? The noble Baroness, Lady Byford, raised a point about international companies. How would the obligation operate in such a way as to minimise the obligation being fulfilled simply by imported biofuels or other renewables? That is the point at which, in this context, the international ownership of the oil companies presents a potential problem.
Some of these issues can be dealt with by secondary legislation, but some of them probably ought to be resolved, at least in principle, on the face of the Bill. The current wording would therefore require significant amendment.
I am also mindful of the point made by my noble friend Lord Carter. If, at the end of the consultation, there is solid support for a movement towards an obligation, where are the powers for us to impose such an obligation? If we do not begin to talk about it now, we might have to invent some other vehicle for this.
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While it would be true to say that the exact form of the obligation will require some considerable work and probably some more detailed attention at a later stage, in the circumstances, given the widespread support for such an obligation and the timing of the consultation, and on the understanding that what comes out of the Commons may be substantially different from the amendment as drafted, I am prepared to accept the amendment.
Lord Ezra: My Lords, everybody will be delighted at what the noble Lord has just said. It will fill all of us with great pleasure, not only those directly involved in the farming community but those involved in energy and energy efficiency who have fought so hard to transform the energy scene. This is an important step forward—it has really made the day for many of us. Other attempts at getting amendments accepted have not been so successful. I thank the Minister as well as the noble Lords, Lord Carter, Lord Palmer and Lord MacGregor, for the part they have played in this. I wish this amendment well when it wends its way through the other place.
On Question, amendment agreed to.
Lord Ezra Lord Ezra moved Amendment No. 20:
After Clause 127, insert the following new clause—

CHAPTER 5
  CLEAN COAL TECHNOLOGY

    PROGRAMME FOR CLEAN COAL TECHNOLOGY
    (1) The Secretary of State may by order establish a programme for clean coal technology that introduces demonstration plants for the development of clean coal technology.
    (2) Such an order may also set out additional programmes that will facilitate the application of clean coal technology both in the United Kingdom and overseas.
    (3) Before making such an order, the Secretary of State shall have regard to the effect of clean coal technology on—

    (a) protecting the global environment,

    (b) responding to the foresight initiative,

    (c) exploiting market potential,

    (d) ensuring the security of United Kingdom energy supply, and

    (e) maintaining a presence for the United Kingdom in a global energy market.

    (4) In this section "clean coal technology" means specified technologies for the generation of electricity from coal that meet specified pollutant emission performance criteria."
    The noble Lord said: My Lords, this is another amendment that has been through Committee and Report. I have returned to it because of my long association with the coal industry. It relates to clean coal technology. I moved a similar amendment in an attempt to persuade the Government to introduce some form of obligation to stimulate the development of cleaner coal technology. However, it was rejected. Therefore, this amendment, like the previous one, is much more permissive. It follows the lines of what was said to about clean coal technology in the energy White Paper, which indicated that the Government were minded to have a programme for clean coal technology that would lead to the introduction of demonstrator plants.
    That is precisely what the amendment proposes. It follows the lines of the White Paper. It is therefore not a new development. It would give great encouragement to the coal industry, which is worried about its future. It would enable us to do a great deal of additional export business through having demonstrator plants showing how this technology could work, as the Energy White Paper indicated. Therefore, I very much hope that, in this revised form, the Minister will be prepared to accept the amendment. I beg to move.
    Lord Whitty: My Lords, although I accept that there is an important role for cleaner coal technology, I am afraid that I cannot be quite as helpful on this amendment in its precise form as I was on the previous one. That is principally because, although we are involved in trying to draw up a carbon abatement technology programme for fossil fuel-based power generation—which we are doing in collaboration with the industries and which will build on existing DTI support for cleaner coal technologies—and cleaner coal technologies will play an important part in reducing carbon emissions and maintaining a source of power that minimises those emissions, the amendment relates to the demonstration of cleaner coal technologies and the case for the Government to support a demonstration plant.
    Experience around the world, particularly in the United States, suggests that cleaner coal technology demonstrators do not fulfil their objective of moving the technologies into the marketplace. Therefore, in a value-for-money sense, a legal obligation to engage in such a demonstration plant is not a useful option. The Government therefore acknowledge the importance of cleaner coal technology, but the intention that would arise from the amendment is not the most effective way forward. We would rather engage with the industry over the next few months and, indeed, with the noble Lord and others who are interested in this matter to see how cleaner coal and carbon abatement technologies should develop. I am sure that my colleague Mr Stephen Timms at the DTI, the Minister with executive responsibility in this area, would be happy to meet the noble Lord and others to see whether they could take the matter further. However, I cannot accept the amendment.
    Lord Ezra: My Lords, I find that extremely disappointing. In fact, it seems to go back on what the Government wrote in the energy White Paper, in which they said:
    "With this in mind, we have already put in place a programme of support for advanced traditional cleaner coal technologies which is intended to bring forward demonstrator projects that may help to showcase the relevant technology more widely".
    That is in cold print in paragraph 6.64 in the energy White Paper.
    It seems to me that that is very far away from what the noble Lord, Lord Whitty, has just told us. Is he therefore saying that the Government are going back on the intention so clearly stated in the Energy White Paper? If so, it is an extremely sad day for coal. It is, I would suggest, an extremely sad day for the Labour
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    Party, which traditionally has had the closest possible historic connection with the coal industry. I should have thought that it would have been the first party to have grasped at any way in which the future of coal can be provided for.
    I am really disturbed by what the Minister said. He said that he would be open to further discussion. with himself and with Mr Timms. I would certainly like to take that up. However, I want to emphasise that what he has just told us is at extreme variance with what is written in the Energy White Paper. I do not wish to say any more about the matter and, at this late hour, I certainly do not want to divide the House on it. although I would have done so if we had discussed it earlier. I shall take up the Minister's offer of talks. In the mean time, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 151 [Applications for energy administration orders]:
    [Amendment No. 21 not moved]
    Clause 153 [Energy administrators]:
    10.30 p.m.
    Lord Lea of Crondall Lord Lea of Crondall moved Amendment No. 22:
    Page 117, line 5, at end insert—
    "() salaries, other contractual terms of employees, and their occupational pension provision, including rights conferred under Schedule 14 to the 1989 Act (the electricity supply pension scheme):"
    The noble Lord said: My Lords, I am moving the amendment now because it was not possible for any of the noble Lords who put their name to it to be present to move it at Report stage.
    Schedule 14 to the Electricity Act 1989 empowered the Secretary of State to make regulations, which would protect employees then in the industry from detriment in respect of their pension provision. These were enacted as the Electricity (Protected Persons) (England and Wales) Pension Regulations 1990. Similar protection was provided for employees in Scotland under Schedule 15 to the Act and the Electricity (Protected Persons) (Scotland) Pension Regulations 1990. The regulations impose a duty on the relevant employer to maintain or provide its protected employees and protected beneficiaries—together called protected persons—with pension rights, both on an ongoing basis and, in particular, in the event of the partial or total winding up of the scheme; the restructuring or change of ownership of the participating employers; or the transfer of employees from one employer to another within the electricity industry.
    This clause appears to lay a duty on the administrator to prioritise the interests of creditors and, subject to them, the interests of members of the company. Through the amendment we are seeking confirmation that the arrangements for a special administration regime do not, and are not intended to,

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    override the statutory duties on employers of protected persons under the Electricity Act 1989. I beg to move.
    Lord Whitty: My Lords, I believe that I am able to give such confirmation and confirm that, in the event of a special energy administration, the duties in this respect of employers of protected persons under the Electricity Act 1989 and the protected persons regulations will not be overridden by the duties of the energy administrator. The fact of the company being in administration, whether ordinary or energy administration, will not in any sense terminate the company's duties in this respect. In both cases, the trustees of the pension fund, if the fund is owed money by the company, will be treated as an unsecured creditor of the company.
    The provisions of this clause follow the precedent of existing insolvency law, adapting it only where necessary for the purpose of energy administration. Therefore, the rights of employees and pension rights are unaltered as compared with any other administration situation. I hope that that goes far enough for my noble friend to accept it as the reassurance that he sought.
    Lord Lea of Crondall: My Lords, I am glad to have the confirmation on the record from my noble friend the Minister that that is the position. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 167 [Appeals to the Competition Commission]:
    Lord Kingsland Lord Kingsland moved Amendment No. 23:
    Page 126, line 27, leave out "whose interests are materially affected by it" and insert "who is a party to the document designated pursuant to subsection 2(b)"
    The noble Lord said: My Lords, Clause 167 currently provides that persons who are "materially affected" by a decision of the energy regulator will be entitled to appeal against that decision.
    In Grand Committee, and on Report, we argued that the concept of material effect should be changed to the wider concept of sufficient interest. This was not because we wish to enable additional parties to be able to appeal against Ofgem's decisions. It was because we were concerned that, on the test of material effect, there was no guarantee in law that all parties to an industry code would be equally entitled to appeal in relation to an Ofgem decision. We agree with the Government's policy, which is set out in the Bill's Explanatory Notes, that those persons who are able to appeal should include the parties to the relevant codes. However, what is unclear is whether, as a matter of law, all code parties would, in fact, qualify as appellants under the "materially affected" test.
    The Minister objected to what he called the "dilution" implicit in our proposed change of test. He feared that this would open the floodgates to appeals from persons whose relationship to a particular code might be indirect or purely tangential. This concern
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    seems exaggerated to us, given that an indirect interest or a tangential interest is by no means the same as a sufficient interest.
    In any event, there is an easy way to resolve this matter. That is to ensure, by express drafting, that the parties to the industry codes—in other words, the market participants who are on the receiving end of Ofgem's decisions—are a distinct category of persons who unambiguously have appeal rights, separately from the test applied to other persons. These two amendments achieve this. They provide beyond any doubt that all parties to the industry codes have a right of appeal, while also bringing in as materially affected persons Energywatch and other representative bodies who are not formally parties to the codes.
    These amendments should resolve many of the concerns that we have had about the Bill's approach to the test of the right to appeal, while not putting Ofgem's decisions at risk of appeal by persons who have no substantial relationship to the industry codes. On that basis, I find it hard to conceive of any good reason why the Government would not welcome these amendments. I beg to move.
    Lord Whitty: My Lords, while we have made a number of amendments in relation to the appeals procedure, we clearly have not swayed the noble Lord's position on this one. I hope that that is not because of some misunderstanding. I accept that he has adapted his amendment in an attempt to address our concern about the use of a sufficient interest test but nevertheless he is persisting in the view that we have too narrow a basis for parties to appeal.
    The Government's view is that parties to the code in question will be able to appeal but only provided that they meet the "materially affected" test in particular circumstances. Not all parties to the code will meet that test in every instance and bodies such as Energywatch may be materially affected in certain respects and, although not party to the code, would therefore also be able to appeal certain decisions on the same basis.
    The noble Lord's amendment would seem to lead to a situation where all parties to the codes would be able to appeal every decision. The Government cannot accept that outcome. We cannot accept that any legal persons who do not fall under a "materially affected" definition should be allowed to appeal the decision even if they might be party to the code, or if they are not. There are elements within the industry who believe that such a broad basis of appeal should be allowed, but the Government's view—I think that it will be supported by the majority in the industry—is that this would be disproportionate and contrary to the policy of having a fairly tightly prescribed right of appeal.
    In our view, therefore, "materially affected" is the right hurdle. This is an important element of the balanced package that is designed to address the concern of the majority of respondents to last year's consultation and provide a degree of certainty and avoidance of delay, whereas the possibility of having a much broader-based

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    threshold of appeal could lead to a flood of appeals which would grind down the whole of the process to no great benefit of the majority of companies involved in the industry. I therefore believe that there is a conflict here, but I am not convinced by the noble Lord's arguments and cannot accept the amendment. I hope that he will not persist with it.
    Lord Kingsland: My Lords, at this late hour it is rather difficult for me to persist with it. The only way in which I could take my persistence one stage further would be to seek to divide the House tonight; and at a quarter to eleven in the evening I should like to assure the Minister that I have no intention whatever of doing that.
    However, as the Minister rightly surmised, I am disappointed in his reply, especially since I believe that it conflicts with the statement set out in the Bill's Explanatory Notes. We have made substantial moves over the three stages of the Bill in your Lordships' House to try to meet the concerns expressed by the Government about our original suggestion of the sufficient interest test. I shall not accuse the noble Lord of churlishness in this matter. However, I think that the noble Lord's approach to our latest amendments is rather harsh.
    I hope that, during the gap between the termination of the stages in your Lordships' House and the commencement of the stages in another place, the Minister and his colleagues will think again about this matter. Meanwhile, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 24 not moved.]
    Clause 178 [Assistance for areas with high distribution costs]:
    Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 25:
    Page 135, line 43, leave out "negative" and insert "affirmative"
    The noble Baroness said: My Lords, this amendment is succinct, and the case for making it is also succinct.
    On Report, the House agreed to amend Clause 179 to make it subject to the affirmative resolution procedure. Clause 179 enables government to introduce a scheme to subsidise high transmission costs for renewable generation sources in remote areas. The case for this power to be made subject to the affirmative resolution procedure, rather than the weaker negative procedure, was that Clause 179 dealt with more than a narrowly technical matter. On the contrary, Clause 179 is a major departure from normal regulatory practice since it contemplates a new and potentially untransparent subsidy to further the ends of what would otherwise be uneconomic renewable development. Rightly, therefore, this House thought the exercise of such a power should be subject to a level of parliamentary scrutiny higher than that which is available under the negative procedure.
    Clause 178 is broadly analogous to Clause 179 in its cross-subsidising effect, as it aims to offset the adverse consequences in Scotland of the abolition of the
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    hydro-benefit subsidy. To that end, under the clause the Government will be able to raise a quasi-taxing levy on the general body of electricity consumers. On that basis, I am sure that the House will recognise that the same arguments that justified the subjection of Clause 179 to the affirmative resolution procedure apply with equal, if not greater, force to Clause 178.
    In those circumstances, I hope that the Minister can accept this simple amendment. I beg to move.
    10.45 p.m.
    Lord Davies of Oldham: My Lords, I am going to disappoint the noble Baroness in everything except being as brief and, I hope, precise as she was in moving the amendment. We of course recognise that the application of the affirmative resolution procedure is appropriate in certain circumstances, but we do not think it right under the clause. The Delegated Powers Committee did not raise any issues on the use of the negative resolution procedure with respect to the scheme.
    The noble Baroness helpfully referred to the amendment made to Clause 179, but we also have appropriate precedents and parallels. The negative resolution is provided for under Section 72 of the Utilities Act, which amends the Electricity Act 1989. That enables the Secretary of State to lay an order that, for example, requires the holder of a supply licence to charge uniform prices in a specified area of Scotland. In that respect, there are very clear parallels between Section 72 of the Utilities Act and Clause 178 of the Bill, which seeks to protect customers in the north of Scotland.
    We think the negative procedure appropriate. I hope that, in consideration of that parallel, the noble Baroness thinks that the Government are right in this instance.
    Baroness Miller of Hendon: My Lords, my noble friend Lord Jenkin wrote in the Times on 14 April about the unwillingness of the Government to accept perfectly sensible amendments to the Bill. This is such a case. Clearly, I shall not do anything about it at this late stage, but I hope that my colleagues in the other place have a better response than we have just had. After all, the procedure applies to Clause 179, and Clause 178 is broadly similar. In fact, its provisions go even further and ought to be subject to affirmative resolution; there is no case for negative resolution to be used at all. However, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Triesman Lord Triesman moved Amendment No. 26:
    After Clause 179, insert the following new clause—

    RESTRICTIONS ON DISCLOSURE OF INFORMATION
    In section 105 of the Utilities Act 2000 (c. 27) general restrictions on disclosure of information)—

    (a) in subsection (1)(a) for "or Part I of the 1989 Act" substitute ", Part 1 of the 1989 Act or section 178(5) or 179(5) of the Energy Act 2004"; and

    (b) in subsection (3)(a) after "1989 Act" insert ", sect ion 178 or 179 of the Energy Act 2004"."

    The noble Lord said: My Lords, the House will recall that we agreed to consider a very similar amendment on the subject after it was put forward by the noble Baronesses, Lady Miller of Hendon and Lady Byford, and the noble Lord, Lord Jenkin of Roding. I should say that I am sorry that he has not been here today to enjoy the final jousting sessions on the Bill. We are grateful to them for raising the issue, and I hope that I have addressed their concerns with a slightly different drafting approach.
    The amendment simply provides for the protection of information provided under the hydro-benefit replacement scheme and the adjustment of transmission charges for the renewable generators scheme through the application of Section 105 of the Utilities Act 2000. The addition of the proposed new clause will make it an offence to disclose information provided under the respective schemes, except in those circumstances specified under that section.
    Several circumstances would allow for disclosure of information under Section 105 of the Utilities Act; for example, disclosure made with the consent of the individual who is, for the time being, carrying on the business, or disclosure for the purposes of facilitating the performance of any of the functions of the Secretary of State, the authority or the Competition Commission under the 1986 Act, the 1989 Act or the Utilities Act 2000. But in other respects we believe that it meets the substantive objections that were made to the original drafting. Therefore, I beg to move.
    Baroness Miller of Hendon: My Lords, as the Minister said, throughout the discussions on the Bill noble Lords on this side of the House argued strongly for confidentiality and I am pleased to welcome the government amendment, which was tabled in response to our amendment at Report. We thank the Minister for that.
    On Question, amendment agreed to.
    Clause 183 [Applications of general duties to Part 4 functions etc.]:
    Lord Whitty Lord Whitty moved Amendment No. 27:
    Page 142, line 10, leave out from "under" to "as" in line 11 and insert "Chapters 2 to 4 of Part 4 of this Act"
    The noble Lord said: My Lords, in moving Amendment No. 27, I shall speak also to Amendment No. 28. Both amendments are technical. Amendment No. 27 relates to functions conferred by the Secretary of State or GEMA under Chapters 2 to 4. The amendment makes it clear that these functions will be subject to the principal objectives and general duties set out in the Gas Act 1986. Amendment No. 28 relates to powers in the Bill conferred on the Secretary of State to amend the licence conditions. Clause 184 makes various provisions about those powers, but, as it stands, it is incomplete. Amendment No. 28 corrects that omission and maintains consistency. I beg to move.
    On Question, amendment agreed to.
    Clause 184 [Supplementary provision about licence condition powers]:
    Lord Whitty Lord Whitty moved Amendment No. 28:
    Page 142, line 33, leave out from "under" to "with" in line 34 and insert "Chapters 2 to 4 of Part 4 of this Act"
    On Question, amendment agreed to.
    Baroness Byford Baroness Byford moved Amendment No. 29:
    After Clause 188, insert the following new clause—

    RENEWABLE ENERGY INSTALLATIONS: DECOMMISSIONING
    (1) Where a consent is given under section 36 of the 1989 Act for the construction of a renewable energy installation in —

    (a) tidal waters and parts of the sea in or adjacent to Great Britain up to the seaward limits of the territorial sea; and

    (b) waters in a Renewable Energy Zone.

    The Secretary of State shall, before that consent is brought into force, publish a schedule for the decommissioning of that installation.
    (2) Whenever a renewable energy installation, as defined in subsection (1) ceases to be operable for any reason the Secretary of State shall activate the decommissioning schedule unless he considers there are particular reasons not to do so."
    The noble Baroness said: My Lords, I apologise in advance to noble Lords, because I wish to return to this important amendment, for which I have waited patiently all afternoon and evening.
    The passage of the Bill has been, for me, one disturbing revelation after another. According to a Written Answer on 30 January this year by Mr Timms, demand rose by 2.7 per cent per annum in the 20 years from 1982 to 2002. UK supply capacity from conventional sources—coal, oil, our own natural gas, nuclear and hydro—is falling and that will continue for the next 10 or more years. According to my noble friend Lord Gray on 7 January, the 32 per cent of our current supply that comes from coal will be eliminated by 2016 if emission constraints are enforced. He went on to say that by 2020 only one nuclear power station will be operational—and nuclear currently provides 23 per cent of our requirements.
    By 2020, at historical expansion rates, demand will have grown from 344 trillion watt hours in 2002 to some 511 trillion watt hours and we shall have lost nearly 50 per cent of our current generating capacity. I have been brought to realise, as have other noble Lords, that if that situation of falling supply and growing demand continues, Ofgem is tasked with holding consumer prices or lowering them even further. Surely that is interfering with market forces and bodes ill for the Commissioning of fresh sources of supply. To make matters worse there was a clear indication from the Minister, when challenged by my noble friend Lord Dixon-Smith on 29 March (at col. 1140 of the Official Report) that under present rules climate change levy will be charged to all established sources of supply, including wind farms.
    Recent press comments and on the radio, to say nothing of the TV programme, "If … the lights go out", have all highlighted Britain's growing dependence on imported fuels, especially coal and gas from Eastern Europe. There has also been informed comment about the intervention by China in the world

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    commodity markets, particularly in coal, iron ore, steel and gas. It is felt that it has already hardened prices and is likely to force them up even further.
    But the Government, as we have debated the Bill, will not come off the fence with regard to nuclear production. Until they do, there will be no expansion of it. While no direction is given on the subject, planning even to replace the supplier we are losing is almost impossible.
    All this adds up to a desperate, frightening and dangerous scenario. Can the Minister say what powers the Secretary of State can command without having to introduce fresh primary legislation and without having to declare a state of emergency to reduce demand over a period should our supply be jeopardised? Should the gap between the anticipated maximum supply and demand fall to, say, 5 per cent. can he order the population to turn lights off or reduce the domestic use? I am thinking of something similar to the hose-pipe ban brought on in the time of drought.
    I think that the Government have to decide whether and how to ensure that wind power will be used as a primary source of supply. One of my fears is that the views in many of our beautiful high areas—miles from off-shore wind—views will be changed by the addition of thousands of wind turbines. My other great fear is that the levels of monitoring and control over that wind farm development are not adequate. Perhaps in some instances greed might triumph over conservation, which leaves groups such as the RSPB, Greenpeace, the WWF and others to highlight the liberties being taken. In such circumstances, I believe that there would be a public backlash against the use of methods which involve heavy engineering in harnessing wind, water and wave power—something we do not want to see.
    Radio 4 has run a series entitled "Costing the Earth". On 8 April, the subject was coastal erosion. I understand that the programme reported that we export more than I million tonnes of marine aggregate each year to the continental coastal countries which have banned extraction of their aggregates in their own coastal waters because of the effect that is having on coastal erosion. The reason given for the use of our marine rather than land aggregates is, I understand, that it is cheaper and easier to extract from the seabed and because the level of monitoring and control is so much lower at sea. If that is not true, I should be grateful for the Minister to confirm that. It is being suggested and if it is true it is a worrying scenario.
    Decommissioning is but one aspect of the off-shore wind turbine business, but the Government refuse to ensure that a would-be developer produces a decommissioning commitment in the form of an approved timetable plan before—and I stress the word "before"—he is granted planning permission. The Government make great play of the current friendly arrangements with those who own or run oil platforms around our shores. However, those companies have been in business for a considerable length of time and have large resources of their own.
    In contrast, I understand that much of the finance for developers of wind farms will be from venture capital and the resultant companies will be liable to
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    financial instability. It is possible that they could be. The Bill does not specify the sanctions that will apply to those who fail to implement a satisfactory decommissioning scheme in the event that it is necessary.
    The noble Lord, Lord Whiny, wrote to me on 6 April and I am grateful to him. The letter was helpful, but it raised additional concerns which I have raised tonight. In the letter, he said that the relevant consents will contain a condition stipulating that the object in question may not be installed in the sea until such time as a decommissioning programme has been agreed with the Secretary of State. But what is to stop the developer simply getting on with doing it? He has obtained his planning consent, his turbine and his necessary wires and connector and there is a business to go ahead. What is there to constrain him?
    The letter also raises an issue discussed in our debate on 23 March at cols. 638–39; that is, the existence of a choice of legislation under which a developer can seek the various approvals that he needs. The implication is that he can get round the less pleasant aspects of this Bill by using another one. I am aware that the Government, faced with amendments voted for in this House, sometimes fail to bring them into force and simply continue to use old legislation as empowerment for statutory instruments.
    I feel that the picture that I am painting and, indeed, the response to the noble Lord's letter have highlighted a serious threat. The RSPB particularly raised this issue with me. It says that everything laid down in the Bill leaves both the Secretary of State and the developer with considerable leeway about how open they are about proposals for the decommissioning of installations. I know that the Government are seeking a more flexible process, but what kind of environmental factors and scientific considerations do they envisage could make it undesirable to remove structures from the marine environment once they have reached the end of their operating life?
    We spoke about this issue at length during Grand Committee and Report. However, at this stage, I do not believe that the Government have allayed my fears, and that is why I have reintroduced the matter tonight. I apologise for having taken a little while in going through it, but this is the last chance for me to do so in this House before the Bill goes to another place.
    I shall be content if the noble Lord acknowledges that I have raised issues that the Government may like to consider further, and I do not intend to divide the House. The noble Lord's letter to me clearly states that the Government have it in mind to ensure that the laid-down regulation will be in place. However, that will be after consent has been given and I do not understand why consent should not be given before the plans are put forward for consideration. I beg to move.
    11 p.m.
    Lord Whitty: My Lords, the noble Baroness gave a rather sweeping introduction to the amendment. At one point, I was slightly concerned that she was not speaking to the amendment with which I thought we

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    were dealing. Nevertheless, we have reached the point where I can now relate to the earlier discussion and the correspondence.
    My first point is that the noble Baroness's amendment deals with one pattern of consent, whereas our scheme, which is set out in Clauses 107 to 116, gives more comprehensive coverage, dealing not only with the Electricity Act but also with the Transport and Works Act.
    Secondly, I shall more or less repeat the words of the letter. In relation to any relevant consent for the renewable energy installation or any related electric line, the object cannot be put in the water until such time as the decommissioning programme has been approved by the Secretary of State. Therefore, the consent is subject to the provision of a decommissioning programme to the Secretary of State. There is no point in looking in detail at decommissioning before the project is consented because that effort will be wasted if the consent is not given. However, the scheme under Clauses 107 to 116 will apply as soon as the project is consented; in other words, the requirement to provide a decommissioning programme will apply prior to that consent being implemented by putting the installation in the water.
    Therefore, I do not believe that the spectre that the noble Baroness foresees of people going ahead with building all kinds of horrific things at sea which are not accompanied by a viable decommissioning programme really arises. The amendment as it stands envisages that the Secretary of State must publish a decommissioning programme. As I said, the Bill gives the power to the Secretary of State to require the submission of a decommissioning programme, although that is discretionary. While we expect her to make full use of those powers as a matter of routine, the flexibility is also helpful. But in any case, it is primarily for the person with the consent to produce the decommissioning programme to be submitted to the Secretary of State for her approval. The person responsible for the installation will provide the decommissioning programme, subject to the Secretary of State's approval. So, there are all sorts of problems with the approach suggested by the noble Baroness.
    There is a misunderstanding that the consent could be implemented without the decommissioning requirement and also that the amendment would apply to all forms of consent. The amendment is more restrictive than our provision, which includes the safeguards that the noble Baroness seeks. I am quite happy to engage in further discussions. I do not think that her amendment does the job she seeks. The Bill as it stands does it better.
    Baroness Byford: My Lords, I am grateful to the Minister and have been throughout. Obviously, he realises that we have genuine concerns and that there is a need to protect the environment. The reason I spread my nets very wide to start with was that the running down of nuclear and the Government's desire to push quickly the growth of wind farms will have huge implications for marine life. We talked about that in earlier amendments, so I shall not go over the ground again. If our demand were going to reduce, then the seriousness of it would not be so great.
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    However, because there will be increasing pressures on this type of energy source in the future, I thought that it was important to spread the net wider.
    I do not know much about business, but it seems to me to be an odd way to go about matters for one to get consent and then to come back and justify how one is going to decommission something at the end of the day. But I accept what the noble Lord has said. I also accept if one is not successful in one's bid that one has wasted time. Perhaps I can draw a parallel, which the noble Lord will know well. On the agricultural schemes, which he and I deal with on a regular basis, that is one of the risks one runs. One does a lot of work in trying to put in one's application, knowing full well that one may not actually get it granted anyway. I think the noble Lord knows why I have come that way.
    I am grateful to the noble Lord for saying that we can discuss the matter further. The one thing that has come out of the Bill, and which has been highlighted in the amendments today, is the need to have regard also to the marine environment. My noble friend raised the whole question of fishing and of navigation, but certainly the protection of marine environment and our wildlife, which is so dependent on circumstances for future growth, is important. At this stage, I think I will have to say that it is over to my colleagues in another place when the Bill gets down there. I thank the Minister for his response and certainly will come back to him on the issue. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Schedule 1 [The Nuclear Decommissioning Authority]:
    Lord Whitty Lord Whitty moved Amendment No. 30:
    Page 151, line 2, leave out paragraph 4 and insert—

    Constitution of NDA for initial period
    4 (1) Until the end of the initial period the NDA is to consist of just those members who have been appointed.
    (2) As soon as practicable after his own appointment takes effect, the chairman must exercise the power to appoint a chief executive.
    (3) Appointments of members other than the chairman and chief executive may be made during the initial period only after the appointment of the chief executive has taken effect.
    (4) During the initial period the requirements of paragraph 9(1)—

    (a) do not apply to a decision to which the chairman is a party if it is made when the chairman is the only non-executive member; but

    (b) are not to be capable of being satisfied in relation to a decision made at any other time unless at least two non-executive members are parties to the decision.

    (5) The chairman must ensure that proper records are kept of everything he does, while he is the only non-executive member, in the exercise or performance of powers or duties conferred or imposed on the non-executive members.
    (6) In this paragraph "the initial period" means the period which begins with the commencement of so much of this Act as provides for the establishment of the NDA and ends with whichever of the following first occurs—

    (a) the time when an appointment takes effect that brings the number of members of the NDA up to seven;

    (b) the time specified as the end of the initial period in a notice given during that period by the Secretary of State to the NDA for the purposes of this paragraph."

    On Question, amendment agreed to.
    Schedule 2 [Procedural requirements applicable to NDA Is Strategy]:
    Lord Whitty Lord Whitty moved Amendment No. 31:
    Page 157, line 22, at end insert—
    "() In this paragraph references to a designated installation, designated site or designated facility include references to an installation, site or facility designated by a direction which is not yet in force."
    The noble Lord said: In moving Amendment No. 31, I shall speak also to Amendment No. 32. The Bill provides that the NDA is required to consult local authorities and other bodies in respect of designated sites, installations and other facilities. The amendments provide that the NDA is under a similar obligation where the designation in question is not yet in force. That is because the NDA will not take formal responsibility until 1 April 2005. However, it is important that it is required to consult those bodies once it has identified the sites and facilities and prior to the formal designation. The issue is fairly straightforward. I beg to move.
    On Question, amendment agreed to.
    Schedule 3 [Procedural requirements applicable to NDA 's annual plans]:
    Lord Whitty Lord Whitty moved Amendment No. 32:
    Page 160, line 13, at end insert—
    "() In this paragraph references, in relation to the preparation or revision of a plan, to a designated installation, designated site or designated facility include references to an installation, site or facility designated by a direction which—

    (a) is not yet in force; but

    (b) is to come into force during the year to which the plan relates."

    On Question, amendment agreed to.
    Schedule 8 [Pensions]:
    Lord Triesman Lord Triesman moved Amendment No. 33:
    Page 184, line 43, after "securities" insert "of"
    The noble Lord said: My Lords, a large number of amendments and possibly the shortest speech is a gratifying combination. This group of amendments makes very minor drafting clarifications to Schedules 8 and 9. I can assure noble Lords that they do not in any way affect the purpose of those schedules. I beg to move.
    On Question, amendment agreed to.
    Lord Triesman Lord Triesman moved Amendments Nos. 34 and 35:
    Page 185, line 25, after "employer" insert "or if his employer becomes the subsidiary of a particular body corporate"
    Page 186, line 10, leave out "the"
    On Question, amendments agreed to.
    Lord Triesman Lord Triesman moved Amendment No. 36:
    Page 186, line 25, leave out "the trustee of the scheme" and insert—
    "(a) the trustee of the scheme; and
    (b) such persons as appear to the NDA to represent the employees, or directors or other officers, likely to be affected by the modification."
    The noble Lord said: My Lords, these amendments respond to the amendments tabled by my noble friends Lord Lea and Lord Brooke on Report. They extend the statutory right of employee consultation, first, to
    278
    modifications of a relevant pension scheme—in practice, the BNFL group scheme—in Schedule 8(2), and, secondly, modifications of the NDA pension scheme. In practice, many of those modifications would have fallen within the original employee consultation requirements in the Bill. That is because the Bill as originally drafted already included statutory rights of employee consultation prior to transfer schemes or arrangements, where such schemes or arrangements require employees to leave their current pension schemes.
    We anticipate that many of the modifications, certainly in relation to the NDA pension scheme, will be connected to such schemes or arrangements. Nevertheless, the Government are committed to ensuring that employees and their representatives will be consulted before anything is done to their pension schemes. That was the import of the amendments tabled by my noble friends Lord Lea and Lord Brooke. Extending the statutory right of consultation in that way therefore reinforces the undertakings given at earlier stages. I beg to move.
    Lord Roper: My Lords, we are extremely grateful that this important amendment has been agreed. In the absence of the noble Lords, Lord Lea and Lord Brooke, I wish to say that we are very pleased that people have been given this appropriate response.
    On Question, amendment agreed to.
    Lord Whitty Lord Whitty moved Amendments Nos. 37 to 49:

    Page 190, line 27, leave out "will apply" and insert "applies" Page 190, line 30, leave out "will have" and insert "has"

    Page 190, line 33, leave out "will satisfy" and insert "satisfies" Page 190, line 35, leave out "will be" and insert "is"

    Page 190, line 37, leave out "will be applying" and insert "applies"

    Page 190, line 39, leave out "will be" and insert "is"

    Page 191, line 19, leave out "at" and insert "immediately before"

    Page 191, line 37, leave out "are" and insert "will be"

    Page 191, line 40, leave out "who is"

    Page 193, line 13, leave out "are" and insert "will be"

    Page 193, line 15, leave out from "Before" to "entitled" in line 16 and insert "such transfer arrangements take effect, the NDA must satisfy itself that every person"

    Page 194, line 42, leave out from "consult" to end of line 44 and insert—

    "(a) the NDA; and

    (b) such persons as appear to him to represent the employees likely to be affected by the modification.

    () Before making a modification under this paragraph the NDA must—

    (a) consult such persons as appear to it to represent the employees likely to be affected by the modificai ion; and

    (b) obtain the consent of the Secretary of State to the modification."

    Page 195, line 3, leave out from "A" to "may" in line 5 and insert "UKAEA pension scheme"
    On Question, amendments agreed to.
    Schedule 9 [Taxation provisions relating to nuclear transfer schemes]:
    Lord Whitty Lord Whitty moved Amendment No. 50:
    Page 204, line 6, leave out "1988" and insert "Taxes"
    On Question, amendment agreed to.
    Schedule 16 [Applications and proposals for notices under section 95]:
    Lord Whitty Lord Whitty moved Amendment No. 51:
    Page 231, line 2, after "the" insert "safety zone"
    On Question, amendment agreed to.
    Schedule 20 [Conduct of energy administration]:
    Lord Whitty Lord Whitty moved Amendment No. 52:
    Page 246, line 41, after "proposed" insert "remedy,"
    The noble Lord said: My Lords, in moving Amendment No. 52, I shall speak also to Amendment No. 53. They remedy two very minor drafting errors in Schedule 22. The schedule provides for Schedule B1 to the Insolvency Act 1986 to have effect in relation to energy administration, amended to allow for the circumstances of energy administration. To be legally exact, I beg to move this last amendment of the evening.
    On Question, amendment agreed to.
    Lord Whitty Lord Whitty moved Amendment No. 53:
    Page 247, line 4, leave out "making" and insert "the making of"
    On Question, amendment agreed to.
    An amendment (privilege) made.
    Lord Whitty: My Lords, I beg to move that the Bill do now pass.
    Moved, That the Bill do now pass.—(Lord Whitty.)
    On Question, Bill passed, and sent to the Commons.

    Planning and Compulsory Purchase Bill
    Bill returned from the Commons with certain amendments disagreed to with reasons for such disagreement, with other amendments disagreed to but with amendments proposed in lieu thereof, and with the remaining amendments agreed to; the Commons amendments and reasons were ordered to be printed.
    House adjourned at sixteen minutes past eleven o'clock.

  Overseas Students
  Overseas Students
  Students from China
  Students from China
  Successor Identification Friend or Foe Equipment
  Successor Identification Friend or Foe Equipment
  Defence Procurement Agency: Project Fact Files on Website
  Defence Procurement Agency: Project Fact Files on Website
  NATO Submarine Rescue System
  NATO Submarine Rescue System
  Aircraft Carriers: Assessment
  Aircraft Carriers: Assessment
  Scammell EKA Recovery Vehicle
  Scammell EKA Recovery Vehicle
  Recovery Vehicles
  Recovery Vehicles
  Reservists
  Reservists
  A27
  A27
  Channel Tunnel: Proposed Freight Rail Link and Legislation
  Channel Tunnel: Proposed Freight Rail Link and Legislation
  M6 Toll Road
  M6 Toll Road
  Olympic Games 2012: London Bid
  Olympic Games 2012: London Bid
  Civil Partnership Bill: Tax Consequences
  Civil Partnership Bill: Tax Consequences
  Heritage Lottery Funding: North-east Metropolitan Borough Councils
  Heritage Lottery Funding: North-east Metropolitan Borough Councils
  vCJD Compensation Scheme: Support for Patients' Families
  vCJD Compensation Scheme: Support for Patients' Families
  Autism
  Autism
  Blood Supplies and Safety
  Blood Supplies and Safety
  Hepatitis C and HIV Inadvertent Blood Infection: Payment Schemes
  Hepatitis C and HIV Inadvertent Blood Infection: Payment Schemes
  Alcohol Treatment Centres
  Alcohol Treatment Centres
  Myalgic Encephalomyelitis/Chronic Fatigue Syndrome
  Myalgic Encephalomyelitis/Chronic Fatigue Syndrome
  Obesity: Provision of Pedometers
  Obesity: Provision of Pedometers
  Council for the Regulation of Healthcare Professionals
  Council for the Regulation of Healthcare Professionals
  Animal Health Acts 1981 and 2002
  Animal Health Acts 1981 and 2002

  Afghanistan Donor Conference
  The Lord President of the Council (Baroness Amos)
  My right honourable friend the Secretary of State for International Development has made the following Statement.

  The Foreign Secretary, the Minister of State for Trade, Investment and Foreign Affairs and I attended the donor conference on Afghanistan held in Berlin on 31 March and 1 April, at which donors were invited to respond to the recent needs assessment compiled by the World Bank.

  The conference was an opportunity for donors to: assess the political progress that has taken place in Afghanistan since the Bonn and Tokyo conferences of 2001 and 2002; discuss the challenges that now face the Afghan Government; and demonstrate continued commitment to Afghanistan's long-term future development.

  The announcement by President Karzai of the plan to hold elections in September was warmly welcomed. At a side meeting donors pledged an additional 65 million dollars to the election process, helping to keep it on track. The UK pledged an additional 5 million dollars, taking our overall election funding to 24 million dollars. Preparations for elections are on course although security for a free and fair election remains a major concern.

  Donors demonstrated their commitment to Afghanistan, by pledging 8.2 billion dollars of assistance over the next three years. This represents two-thirds of Afghanistan's requirements over this period, and it is hoped fully to meet Afghanistan's needs with increased money becoming available from donors that were able to make only one-year pledges in Berlin.

  Of this new pledge, over half—4.5 billion dollars—is for this financial year. This meets Afghanistan's request for the year and is more than double the amount disbursed in Afghanistan last year. This increase comes at an important time, as a number of government programmes become effective and the Government's capacity to absorb funds and implement programmes increases.

  As I outlined in my Statement to Parliament prior to the conference (1 March, Official Report col. 74WS) I announced an increase of the UK's commitment to Afghanistan from £200 million over five years to at least £500 million over the same period. This funding is to support a range of reconstruction work, support for conflict prevention, and the counter-narcotics
  WS 8
  effort. A booklet outlining DfID's programme in Afghanistan has been placed in the Library of the House.

  Many donors acknowledged the particular challenges that both drugs and the security situation present to Afghanistan's successful development. I emphasised to the conference the UK's commitment as lead donor to tackling the opium industry in Afghanistan, and many other donors also acknowledged the importance of dealing with this. The UK's specific provision of £70 million over three years to tackle this problem is an important lead and we are working closely with other donors to increase their funding in this area and to ensure that all development assistance is delivered in a way which supports counter-narcotics objectives. In the light of the importance that the conference attached to this problem, it was also a real achievement for the Afghan Government that they signed the Berlin declaration on counter-narcotics with the six signatories to the good neighbourly relations declaration, agreeing a common stance on tackling drugs in the region.

  Northern Ireland: New Targeting Social Need
  Baroness Amos
  My right honourable friend the Secretary of State for Northern Ireland has made the following Ministerial Statement.

  I wish to advise the House that on 14 April 2004 I launched a public consultation exercise in respect of a proposed way forward for new targeting social need (new TSN), the Government's high level policy for tackling poverty and social exclusion in Northern Ireland.

  By undertaking this consultation we are fulfilling a commitment given by the previous Northern Ireland Executive, in its programme for government, to review the new TSN policy.

  Copies of the consultation paper New TSN—the Way Forward—Towards an Anti-Poverty Strategy have been placed in the Libraries of both Houses.

  Water Resource Strategy
  Baroness Amos
  My right honourable friend the Minister of State for Regional Development in Northern Ireland has made the following Ministerial Statement:

  Today I am publishing Water Service's water resource strategy 2002–30.

  The strategy provides a framework for meeting increasing water demand in Northern Ireland, through the efficient use of water including leakage reduction and by upgrading and rationalising the existing supply system.

  An executive summary of the strategy has been placed in the Libraries of both Houses and is available on the Water Service website at www.waterni.gov.uk.

  Joint Medal Office
  The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Bach)
  My honourable friend the Parliamentary Under-Secretary of State for Defence (Mr Ivor Caplin) has made the following Written Ministerial Statement.

  As part of a wider modernisation of service personnel administration policies and procedures and the introduction of the IT to support their delivery known as the joint personnel administration (JPA) programme, and following an investment appraisal and consultation with trade unions, the decision has been taken to concentrate the delivery of JPA from three sites: Innsworth, Gosport and Glasgow.

  This will incorporate the creation, from March 2005, of a Joint Medal Office at Innsworth—the current location of the RAF Medal Office—and will involve the phased closure of the Army Medal Office at Droitwich and the Royal Navy and Royal Marines Medal Offices located at Gosport. In order to provide continuity of service and to build up the necessary expertise at Innsworth, the transfer of responsibilities will he phased.

  Consultation with MoD trade unions about the choice of the three sites from which JPA will be delivered has been undertaken and detailed local consultation about the implications for staff will start shortly. It is expected that some of the current staff will transfer to Innsworth with the work. It is anticipated that staff at Gosport and Innsworth who are unable to transfer to the JMO will be found other positions in the locality, but I cannot rule out a programme of early retirement and redundancy that may be required in particular at Droitwich.

  European Union: Forthcoming Council Business
  The Minister of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean)
  The forthcoming business in the Council of the European Union is as follows:

  Date

  Location

  Event

  April

  26–27

  Brussels

  General Affairs & External Relations (GAERC)

  26–27

  Brussels

  Agriculture & Fisheries Council

  27

  Luxembourg

  EU/Russia Permanent Partnership Council (Troika?)

  29–30

  Brussels

  Meeting of the Economic and Financial Committee

  29–30

  Brussels

  Justice & Home Affairs (Ministerial Informal)

  May

  1

  Dublin

  Enlargement Event

  4–6

  Dublin

  EuroMed Foreign Ministers

  6–7

  Botswana

  EU-ACP Council of Ministers

  7

  Limerick

  Meeting of Ministers with responsibility for equality

  9–11

  Killarney

  Agriculture Informal Ministerial Meeting

  10

  Brussels

  Meeting of Eurogroup

  11

  Brussels

  ECOFIN

  WS 10

  Date

  Location

  Event

  11–12

  Cork

  Health Ministers Consultative Meeting

  14–16

  Waterford

  Informal Meeting of EU Environment Ministers

  17–18

  Brussels

  General Affairs & External Relations (GAERC)

  19–20

  Offaly

  Informal Budget Committee

  21

  Moscow

  EU/Russia Summit (Troika)

  23–25

  Brussels

  Agriculture & Fisheries Council

  24–25

  Brussels

  Meeting of the Economic and Financial Committee

  24–25

  Brussels

  Agriculture & Fisheries Council

  25–27

  Co. Galway

  Conference on Islands and Territorial Cohesion—Meeting New Challenges

  27–28

  Brussels

  Education, Youth & Culture Council

  27–31

  Dublin

  Ministers and Directors of General Public Administration

  28

  Guadalajara

  EU-Latin America/Caribbean Summit

  June

  1–2

  Luxembourg

  Health Council

  1

  Dublin

  Development Ministers' Meeting

  1

  Luxembourg

  Meeting of Eurogroup

  2

  Luxembourg

  ECOFIN

  8

  Luxembourg

  Justice & Home Affairs Council Meeting

  10–11

  Luxembourg

  Transport, Telecom & Energy Council

  14–15

  Luxembourg

  General Affairs & External Relations (GAERC)

  17–18

  Brussels

  European Council

  21–22

  Luxembourg

  Agriculture & Fisheries Council

  21–22

  Brussels

  Meeting of the Economic and Financial Committee

  25–26

  tbc

  EU-US Summit

  28–29

  Luxembourg

  Council Meeting of EU Environment Ministers

  July

  1

  Brussels

  Coreper 2

  2–3

  Maastricht

  Competitiveness (informal)

  7

  Brussels

  Coreper 1

  7–8

  Brussels

  Coreper 2

  8

  tbc

  EU-Ukraine Summit

  8–10

  Maastricht

  Social Policy (informal)

  9–10

  Amsterdam

  Transport (informal)

  12–13

  Brussels

  General Affairs & External Relations (GAERC)

  12–14

  Rotterdam

  Informal Ministerial Education Youth and Culture

  14

  Brussels

  Coreper 1

  15

  Brussels

  Coreper 2

  16–18

  Maastricht

  Environment (informal)

  19

  Brussels

  JHA Council

  19

  Brussels

  Agriculture and Fisheries Council

  22

  Brussels

  Coreper 2

  23

  Brussels

  Coreper 1

  August

  No meetings planned

  September

  1

  Brussels

  Coreper 1

  2

  Brussels

  Coreper 2

  3–4

  Maastricht

  Gymnich

  5–7

  Noordwijk

  Agriculture and Fisheries (informal)

  8

  Brussels

  Coreper 1

  8

  Brussels

  Coreper 2

  9–10

  Noordwijk

  Health (informal)

  11

  Scheveningen

  ECOFIN

  13–14

  Brussels

  GAERC

  15

  Brussels

  Coreper 1

  16

  Brussels

  Coreper 2

  17

  Brussels

  Coreper 1

  17–18

  Noordwijk

  Informal Ministerial Defence

  20–21

  Brussels

  Agriculture and Fisheries Council

  WS 11

  Date

  Location

  Event

  22

  Brussels

  Coreper 1

  22

  Brussels

  Coreper 2

  24

  Brussels

  Competitiveness Council

  27

  Brussels

  (Possible) Council Transport, Telcom and Energy

  29

  Brussels

  Coreper 1

  29

  Brussels

  Coreper 2

  30

  Den Haag

  JHA (informal)

  Regional Planning Guidance for the North-West
  The Minister of State, Office of the Deputy Prime Minister (Lord Rooker)
  My honourable friend the Parliamentary Under-Secretary of State has made the following Written Ministerial Statement.

  The North-West Regional Assembly (NWRA) published, on 19 April, a consultative draft of the partial review of regional planning guidance for the north-west (RPG13) which was published by my right honourable friend the Deputy Prime Minister in March 2003.

  RPG 13 sets out the spatial development strategy that encompasses proposals for the development of the region's economy, housing and transport infrastructure, and other land uses. It also sets out proposals for the conservation, management and enhancement of the region's natural and cultural environment.

  Regional planning guidance also provides the regional framework for the plans and strategies of a range of public, private and voluntary organisations, including the preparation of local authority development plans and local transport plans.

  The consultation will also allow consideration of the implications of the northern way growth work being led by the regional development agencies.
  WS 12
  The selective, partial, review covers a number of key matters of importance to the future of the region, including:

  Transport—the regional transport strategy is
  updated in the light of a number of major studies in the region and consultations on national aviation policy. The review also includes transport investment priorities, the management of the regional highway network, a regional freight strategy and criteria to ensure that new developments are accessible by public transport;

  Sustainable energy—targets are put in place that should help to increase the amount of energy supplied from renewable resources;

  Waste management—a new approach to
  handling waste is set out that will encourage recycling and composting, and reduce landfill;

  Climate change—a new policy on climate change is introduced that will aim to meet greenhouse gas reduction targets and allow planning for the implications of climate change;

  Strategic regional parks—three broad areas of
  search for strategic regional parks are identified based on the north-west coast, the Mersey belt and east Lancashire;and

  Strategic views along the River Mersey—a policy to protect and enhance selected views for different parts of the Mersey valley is put forward.

  The draft partial review is published for consultation with all regional stakeholders over a period of 12 weeks. An independent panel will take into account all responses to the consultation before it holds a public examination in November, where it will consider the issues arising from the consultation. The panel will produce a report for the First Secretary of State, who will then publish the final version of the RPG following further consultation, in 2005.

  Copies of the relevant documents are available in the Libraries of the House and have been provided for all of the region's MPs, MEPs and local authorities.