Sitting of 10 February 2004

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

    Whisky Industry
    Mr. Brian H. Donohoe: What progress is being made on introducing strip stamps in the Scotch whisky industry. [152887]
    The Secretary of State for Scotland (Mr. Alistair Darling): I met representatives of the Scotch Whisky Association last week to discuss this issue, and general consultation with the spirits industry is, of course, continuing. My hon. Friend the Economic Secretary to the Treasury is due to meet the association on 23 February to discuss the issue further.
    Mr. Donohoe: I thank my right hon. Friend for that answer, and I am pleased that he is taking such a close interest in this important subject. The Scotch whisky industry has been looking for some time at alternatives to the stamp duty and strip stamps. If it comes up with a successful solution, will he make representations to the Chancellor, so that we can ditch that proposal once and for all and allow the Scotch whisky industry to get on with its main business, which is, of course, to sell whisky both here at home and abroad?
    Mr. Darling: My hon. Friend is right: the industry is of huge importance to Scotland—and, of course, to the whole of the United Kingdom. As my right hon. Friend the Chancellor made clear at the time of the pre-Budget report, his concern is about the growing amount of fraud. Customs and Excise and the Scotch Whisky Association put different monetary values on that fraud, but both agree that there is a problem, and it needs to be sorted out. The Chancellor has said that unless something else is done, he intends to go ahead with the strip stamps. However, he has made it clear that it is up to the industry to talk to Customs and Excise with a view to finding some other way to deal with what is undoubtedly a growing problem. I am sure that the whole House would agree that, faced with a growing amount of fraud, it is necessary to take action, but of course, that action must be consistent with ensuring that
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    we do everything we can to help the industry, which is why we have frozen whisky duty for the past six Budgets.
    Angus Robertson: Why should the Scotch whisky industry have to foot the bill to crack down on crooks? Surely Customs and Excise should be doing that more effectively. Why is a proposal being made for new systems, new overheads, new costs and new regulations, all to be borne by the Scotch whisky industry, when every bottle of whisky is already clearly marked with a lot number, which would help in the fight, which everyone supports, against fraud?
    Mr. Darling: Bottles may be marked, but there is still a problem with fraud, as representatives of the industry admitted when I met them last week. Whisky is going missing when it is shipped out of warehouses. We have made it clear—I have just done so again—that the industry and the Government need to talk together to consider alternatives. As for the hon. Gentleman's first point, it has always been the case in the Scotch whisky industry—and, indeed, in many other industries—that responsibility for security rests jointly with the industry and Customs and Excise. The Scotch whisky industry already has considerable security measures in force to ensure that whisky is kept safe and accounted for, and the vast bulk of it is—but there is a problem with fraud, and the industry and Customs and Excise need to work together to find out how we can sort it out.
    Mr. John McFall: The Economic Secretary will visit Scotland on 23 February at my invitation, in my capacity as the chairman of the all-party Scotch whisky group, and he will start at Allied Distillers in my constituency. I recognise that fraud is a problem, and I am trying to persuade the industry and the Government to take a consensual approach to achieve a satisfactory outcome, but will the Secretary of State ensure that he makes his colleagues aware that this is a £2 billion manufacturing industry, and any solution that is reached should not damage its competitiveness and productivity?
    Mr. Darling: My hon. Friend can rest assured that the Government, and the Chancellor in particular, are well aware of the importance of that industry. Indeed, it is not possible to live in Scotland without being aware of its importance. Of course my hon. Friend is right to suggest that it is in the interests of the industry as well as the general taxpayer—who, after all, will have to foot the loss unless something is done about it—that both the Government and the industry work together to ensure that the problem is dealt with. What is encouraging so far is that the industry is showing a willingness to talk to the Government and discuss with Customs and Excise measures that might help, but as my right hon. Friend the Chancellor has said, the Government cannot ignore a situation in which a very large amount of money is being lost in fraud, and we have to do everything we possibly can to stop that happening.
    Mr. Peter Duncan: The Secretary of State asks the industry to engage with Customs and Excise. Is he aware that one major distiller in Scotland has offered to audit-trail

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    random purchases from the high street to trace fraud? Why has it not received a single phone call from Customs and Excise about that? How can he condone such complacency, when one in 50 jobs in Scotland are at risk?
    Mr. Darling: When I met the industry and the people from the Scotch Whisky Association last week—the association represents the whole industry in Scotland—they said that they had been working on several measures, including audit measures, which they had been discussing with Customs and Excise. It is not true to say that Customs and Excise has not been engaging with the association—the association readily agrees that that is happening. If the hon. Gentleman thinks that something specific could be done that he would care to let me know about, I shall make sure that Customs and Excise sees it. However, it is important for all of us in the House to recognise that there is a significant revenue loss at the moment—the exact monetary value might be a matter of dispute—that is rising and needs to be dealt with. The question is: what is the best way of dealing with that revenue loss?

    Pension Credit
    John Barrett: How many pensioner households in Scotland are in receipt of pension credit. [152888]
    The Parliamentary Under-Secretary of State for Scotland (Mrs. Anne McGuire): As at 31 January, there were 229,000 pensioner households in Scotland, comprising approximately 271,000 individuals, receiving pension credit. The latest monthly pension credit progress report, including numbers of recipient households in each parliamentary constituency in Great Britain, was published yesterday.
    John Barrett: I thank the Under-Secretary for that answer. Does she agree, however, that the increase in the uptake of pension credit over the past month was only 1.4 per cent., and that at that rate of increase it would take another 30 years before everyone who was entitled to pension credit received it? What are the Government prepared to do to remedy that situation? Does she agree that the answer is to reduce the number of means-tested benefits and raise the basic state pension?
    Mrs. McGuire: The answer to all those questions is no. The actual fact about the current situation is that more than 4.1 million pensioner households have been written to about pension credit. I am sure that the hon. Gentleman welcomes the fact that, in his constituency, 2,065 households, comprising 2,424 individuals, now receive an additional £40.43 a week. I ask him to have a conversation with his colleagues the hon. Members for West Aberdeenshire and Kincardine (Sir Robert Smith) and for Gordon (Malcolm Bruce), because in the Mearns Leader, which I am sure is well read in Edinburgh, the hon. Member for Gordon said:
    "I am delighted to see Aberdeenshire pensioners gaining significantly by the introduction of the new Pension Credit."
    The hon. Member for Edinburgh, West (John Barrett) should have that conversation as soon as possible, before he makes any other misguided comments.
    Anne Picking: I am sure that my hon. Friend is aware that, although the good news story of pension credit is just that, another good news story is that only one third of pensioners in the UK actually pay tax. Is that equation reflected in Scotland?
    Mrs. McGuire: I think that I missed the last part of my hon. Friend's question, but I assume that she was talking about the numbers in Scotland. The number of pensioners in Scotland not paying tax will be pro rata to the number in the rest of the United Kingdom. What I do not want to lose sight of is the core of my hon. Friend's comments: we have reduced the tax burden on pensioners so that only about one third of pensioners in the United Kingdom now pay tax.
    Mr. Peter Duncan: Is the Under-Secretary aware that less than 0.25 per cent. of pension credit is currently paid into Post Office card accounts? Does she think that that is too much or not enough?
    Mrs. McGuire: I thought that the Conservative party had spent its whole history building on the idea that people ought to have choice. We cannot—I am sure that the hon. Gentleman is not suggesting this—force pensioners to collect their pensions in whatever way suits us. We have offered pensioners a plethora of initiatives, including support for the Post Office cards, to give them the choice of how they want to collect their pensions every week, and I would have thought that he would see fit to support that.
    Mr. Duncan: The Under-Secretary is right to say that I am very much in favour of choice, but it must be free and fair choice. I am sure that she is aware of constituents of hers who have tried to get their pension credit paid into a Post Office card account, and she will know how difficult that process is. According to the Government's own figures, 140,000 eligible pensioner households in Scotland will not claim the credit. Does she accept my view that they are likely to be the most disadvantaged and the most in need? Is she proud of that statistic?
    Mrs. McGuire: I suggest that the hon. Gentleman leave me to look after my constituents, rather than try to tell me what is best for them. We have widened the choice of ways in which pensions can be collected. One reason for moving from the approach of having books stamped weekly at the post office is that it was open to fraud and theft. Up to 100 pension books per week were stolen. The hon. Gentleman has no credibility on pension credit, because his party is against it.
    Mr. Michael Connarty: I applaud the Government's initiative on pension credit, from which 2,700 families in my constituency—more than 3,300 individuals—are gaining. However, I have found out over the past few weeks that some pensioners do not know that they can claim pension credit. They claim other benefits, and in the middle of it all, forget about claiming pension credit. Will my hon. Friend urge all pensioners and their families to telephone 0800 991234, to get immediate access to pension credit?
    Mrs. McGuire: I am sure that the Pension Service will be grateful to my hon. Friend for highlighting the helpline number. We must make sure that all pensioners have the information they require, and we applaud the Pension Service for making a commitment to contact every pensioner. Sometimes that work is not helped by the denigrating and negative comments that are made by Opposition Members for their own political motives, and certainly not to benefit pensioners.

    Transport Plan
    Gregory Barker: When he last discussed the 10-year transport plan with the First Minister. [152889]
    The Secretary of State for Scotland (Mr. Alistair Darling): I have regular meetings and discussions with the First Minister about a range of matters, including transport.
    Gregory Barker: We are almost one third of the way through the 10-year transport plan. Is it on track? Are trains now one third more reliable? Are road journeys one third better? Can we take any comfort that the plan is going where it should go?
    Mr. Darling: I will help the hon. Gentleman by giving examples that may assist him in relation to his own constituency—
    Hon. Members: This is about Scotland.
    Mr. Speaker: Order. Hon. Members should not tell the Secretary of State for Scotland how to answer a question. I think that he knows how to conduct himself. [Interruption.] Order. I will decide whether or not the right hon. Gentleman is out of order.
    Mr. Darling: Yes, the 10-year plan is on track. For example, we are spending more than £1 billion on upgrading the power supply to trains running south of the River Thames, and we have increased the amount of money going to local authorities. The hon. Gentleman's own local authority has seen a dramatic increase in money. As he is now interested in Scotland, which is a good thing, I can tell him that the Scottish Executive will be spending about £1 billion a year on transport—something they have never done before. The big difference between now and the past is that the Government are committed to sustained investment in the transport system. The problem has been that for decades, not enough money was put into transport. The hon. Gentleman may like to tell his constituents—and his party will no doubt tell this to people in Scotland— that Conservatives oppose every penny spent on transport. They have voted against such expenditure whenever they have had the opportunity.
    Mr. Frank Roy: My right hon. Friend will agree that shipping is vital to the transport sector in Scotland. Will he join me in congratulating the management and workers of the Wishaw firm that next week will charter a ship to transport 2,500 tonnes of steel that will be used in
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    building the grandstand for a racing track in Dubai? Will he do all that he can to encourage exports by companies such as Bone Steel?
    Mr. Darling: I agree with my hon. Friend that shipping is of great importance in exporting products such as the construction materials from Bone Steel that will be used in building the Formula 1 track in Dubai. I take this excellent opportunity to congratulate a Scottish firm on winning that contract and showing that Scottish engineering is respected throughout the world—and it is good, too, that our shipping is being used to transport it.
    John Thurso: Does the Secretary of State agree, particularly in respect of rail, that the 10-year plan has been superseded by his statement of 19 January, when he said that the Government would consider devolving more responsibility to the Scottish Executive? Does he agree that effective devolution of responsibility is possible only if the money to implement the decision is also devolved? Can he assure the House that responsibility will not be devolved without the required financial means being devolved too?
    Mr. Darling: The 10-year plan is an investment plan, and sets out sums of money, from both the public and the private sector, to be invested in the railways and other forms of transport, year by year in the whole of the United Kingdom. On 19 January, I said that we were looking at the organisation of the railways, and that one thing we wanted to consider was the devolution of decisions on rail spending. Obviously, we cannot have a railway if we do not spend the money, but at this stage I am not in a position to tell the House when our final decisions will be made. However, I fully understand the point that the hon. Gentleman is making.
    Mr. Malcolm Savidge: Has my right hon. Friend had discussions on the economic and environmental importance of fast long-distance trains, particularly on the Aberdeen-London route, for both freight and passenger transport? In the latter case, would he impress on the First Minister the fact that improving the track through Fife deserves higher priority?
    Mr. Darling: I agree that it is important that we have a fast and reliable train service from Aberdeen and Edinburgh down to London. I think that everyone in the House knows that the track through Fife has been a matter of concern ever since it was built. It is a difficult line, and it is something that the Scottish Executive and Network Rail, which owns the line, will want to consider. The priority for Virgin, GNER and ScotRail is to drive up reliability. If we get reliable train services, more people will use them.
    Mr. Alex Salmond: While the Secretary of State for Transport is seeking to devolve more responsibility to the Scottish Executive, is Network Rail not transferring control of route planning from Glasgow to Leeds? Is there not an inherent

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    contradiction between those two developments, and will the Secretary of State for Scotland use his good offices with the Secretary of State for Transport to resolve it?
    Mr. Darling: Only a nationalist could get steamed up about the fact that the four people involved in that planning are working out of a Leeds office instead of a Glasgow office. I know that the hon. Gentleman is a betting man, and I am willing to bet him that most people in Scotland did not know that four people in Glasgow were involved in route utilisation studies. For goodness' sake, the important thing is that we have a coherent network so that train services are reliable. That requires money and management, both of which the Government have continued to provide, instead of the petty squabbling that typifies much nationalist thinking.

    Crown Office
    Mr. Tam Dalyell: On how many issues he has consulted the Crown Office since 1 January. [152890]
    The Secretary of State for Scotland (Mr. Alistair Darling): I met the Lord Advocate just before Christmas and discussed a number of issues with him.
    Mr. Dalyell: Since the Crown Office is the lead Department on Lockerbie, would my right hon. Friend ask it what it is doing to follow up the $10 million paid on the 23 and 24 December 1988 to the Popular Front for the Liberation of Palestine general command?
    Mr. Darling: My hon. Friend has raised that matter on a number of occasions, both in questions and in an Adjournment debate. He raised it with the previous Government in 1995. As he knows, the prosecution and investigation of crimes in Scotland are entirely a matter for the Lord Advocate, but I undertake to pass his concerns on to the Lord Advocate, the Crown Office and the Foreign Office.

    Salmon Farming
    Mr. Alistair Carmichael: When he last met Scottish Executive Ministers to discuss the Scottish salmon farming industry. [152891]
    The Parliamentary Under-Secretary of State for Scotland (Mrs. Anne McGuire): My right hon. Friend and I regularly meet Scottish Executive ministers to discuss matters of common interest. He and I keep in close touch with developments affecting the Scottish salmon farming industry.
    Mr. Carmichael: May I remind the Minister that salmon farming was worth £110 million to the Shetland economy last year? It was estimated by the Shetland Salmon Farmers Association yesterday that, if the anticipated 50 per cent. drop takes place next year, some 410 jobs in Shetland will be under direct threat as a result. I remind the Minister that the Secretary of State for Scotland retains an executive power under the Crown Estate Act 1961 to direct the Crown Estate Commissioners. I urge her to consider exercising that power to allow a rent holiday for salmon farmers in
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    Shetland and other affected communities. The rents paid to the Crown Estate Commissioners are not crucial in themselves, but could help with cash-flow difficulties.
    Mrs. McGuire: I know that the hon. Gentleman has a great interest in developments because of his constituency interests—Shetland has the highest concentration of salmon farms anywhere in Scotland. Last year, the Crown Estate introduced a rate cut of some 10 per cent. for salmon farming. However, I will relay the hon. Gentleman's comments to the Crown Estate through my right hon. Friend the Secretary of State. I ask the hon. Gentleman to welcome the fact that the Government have submitted an application to the European Commission for temporary measures to safeguard the salmon farming industry against the importing of salmon from non-EU countries. I hope that that will prove to be one of the ways in which we can build up protection around a high-quality salmon farming industry.
    Mr. Calum MacDonald: Will my hon. Friend confirm that this is, I think, the first time the Government have ever asked for safeguard measures for any product or industry? Is that not a very positive sign of the importance that the Government attach to the salmon farming industry in Scotland?
    Mrs. McGuire: My hon. Friend clearly identifies the fact that this is an unusual measure for any Government to take. The Department of Trade and Industry, working closely with the Scottish Executive, was keen to take it, to ensure that we protect our salmon farming industry. I know that there is concern in my hon. Friend's constituency about dumping from non-EU countries undermining the quality of the product in Scotland.

  The Advocate-General was asked—
  ADVOCATE-GENERAL

    International Law
    Mr. Tam Dalyell: What issues of international law have been raised with her since 13 January. [152902]
    The Advocate-General for Scotland (Dr. Lynda Clark): No devolution issues of that nature have been raised. In relation to non-devolution issues, I am sure that my hon. Friend will be well aware of the long-standing convention in relation to Law Officers' advice that has been adhered to by successive Governments. I remind him that the purpose of that convention is to enable the Government to get the legal advice that they need to perform their functions without having to explain or to justify it, or to reveal that they may have concerns about a particular legal position.
    Mr. Dalyell: Will my hon. and learned Friend show her QC curiosity in relation to the inquiries that the Scottish Secretary is to make into the payment to the Popular Front for the Liberation of Palestine general command on 23 December 1988?
    The Advocate-General: I do not think that my hon. Friend fully understands my ministerial remit, but I shall certainly pass his comments on.

    Devolution
    Miss Anne McIntosh: What devolution issues she has considered since 13 January. [152903]
    Mr. Alistair Carmichael: What devolution issues have been raised with her since 13 January. [152904]
    Annabelle Ewing: What devolution issues have been raised with her since 13 January. [152905]
    Mr. Alan Reid: What devolution issues she has considered since 13 January. [152906]
    Ann McKechin: What devolution issues she has considered since 13 January. [152907]
    The Advocate-General: Since 13 January, 51 devolution issues have been intimated to me, all of which were in the criminal arena and concerned matters such as pre-trial delay, failure to communicate information required by sea fishing measures, and the use of sexual history evidence in trials. I am happy to elaborate on those matters if hon. Members wish.
    Miss McIntosh: I am most grateful to the hon. and learned Lady, particularly following our illuminating half-hour Adjournment debate last week, which was most positive. Will she comment on the situation that will arise after the enactment of the Traffic Management Bill, which will apply in England but not in Scotland? In particular, has she or her office given any thought to the difficulty of prosecuting for road traffic accidents in which cannabis use has been a causal factor
    The Advocate-General: Prosecutions and prosecution policy are entirely matters for the Lord Advocate. I am sure that he has considered that issue, and it is not for me to advise him.
    Mr. Carmichael: Today's report by the Constitutional Affairs Committee states at paragraph 39:
    "The jurisdiction of the Supreme Court over Scottish appeals and any changes will require legislation or a resolution of the Scottish Parliament."
    Does the Advocate-General agree with that assessment? Can she tell the House that she will ensure that it is implemented, and explain why that has not already been done?
    The Advocate-General: The short answer is that we do not have a Bill yet. My functions in relation to Scottish Parliament legislation do not kick in under section 33 of the Scotland Act 1998 Until Bills are available We are awaiting a United Kingdom Bill, and there is no Scottish Parliament legislation for me to examine.
    Annabelle Ewing: During last week's Adjournment debate, which some would describe as less than enlightening, and in which I was fortunate to
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    participate, I asked the Advocate-General a question to which I did not get an answer. I should therefore like to ask it again today. Is the hon. and learned Lady constitutionally required to put the interests of the United Kingdom Government before those of the Scottish Parliament?
    The Advocate-General: One of the reasons why I could not finish all the points that I wished to make in the interesting Adjournment debate that the hon. Member for Vale of York (Miss McIntosh) instigated was that I took too many interventions, including those from the hon. Member for Perth (Annabelle Ewing). I did reply to her question during the debate, but I do not think that she liked the answer. I must make it plain that I am a UK Law Officer and I obviously get instructions, which I consider, from UK Departments. However, my job is to give the best advice that I can about the law. It therefore does not matter whether I am advising the UK Government or anybody else: I always try to give the best advice I can.
    Mr. Reid: Customs and Excise is a UK department, whereas the Scottish courts are devolved. Customs and Excise claims that 200,000 bottles of spirits are sold illegally every day, yet in two years there were only five prosecutions for spirit duty fraud in the Scottish courts. As the Government's legal adviser in Scotland, can the Advocate-General shed any light on the reason why there are so few prosecutions when so much fraud is alleged?
    The Advocate-General: In the devolution settlement, all prosecutions—whether involving UK Departments or devolved matters—are devolved to the Lord Advocate. Prosecution policy is entirely a matter for him, and it is not for me to interfere with that.
    Ann McKechin: Does my hon. and learned Friend agree that, notwithstanding the concerns that the Select Committee on Constitutional Affairs raised today, the proposal for a supreme court is not a threat to the traditions and values of Scots law, and that it should be viewed as part of the process of evolution?
    The Advocate-General: My hon. Friend sums up the matter well. Scots law has survived for many centuries through developing. The institutions, too, develop, and the proposal is one example of that.

  CONSTITUTIONAL AFFAIRS
  The Parliamentary Under-Secretary was asked—
  CONSTITUTIONAL AFFAIRS

    Lord Chancellor
    Ann Winterton: If he will make a statement on the future role of the Lord Chancellor. [153651]
    The Parliamentary Under-Secretary of State for Constitutional Affairs (Mr. Christopher Leslie): To reform the justice system and enhance judicial independence. the Government have concluded that it is no longer tenable for a Cabinet Minister to head the

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    judiciary and chair the second Chamber. The Government will therefore introduce legislation to abolish the office of Lord Chancellor in this Session of Parliament.
    Ann Winterton: Why are the Government hellbent on meddling with our unwritten constitution and abolishing the office of Lord Chancellor, which has maintained judicial independence and in which our constituents have confidence? After all, if it ain't broke, don't fix it.
    Mr. Leslie: That is the right thing to do, and I shall explain why. It is right not only because we need more clarity and transparency than the current blurred arrangement between the different branches of our constitution provides, but, more importantly, because we need a more effective Parliament, judiciary and Executive to ensure that each branch can focus on its core functions. We now have a ridiculous position whereby the head of the judiciary is a politician who also chairs the second Chamber, and the Prime Minister chooses who should chair the House of Lords. The changes are overdue, and I am glad that we can make them.
    Keith Vaz: The Under-Secretary is aware that the Select Committee on Constitutional Affairs has today published our report on the reforms. Although there is support for modernisation of the judicial system, there is also concern that the pace is too fast and that mistakes will be made. Will he assure hon. Members that the post of Lord Chancellor will not be abolished until all the other elements of the modernisation process have been put in place and seen to work?
    Mr. Leslie: I welcome the report of the Select Committee, which looked in great detail at some of our proposals. The constitutional reform Bill will make it plain that all those different aspects are interrelated and that the reform programme has been well thought through. Of course I understand the need for widespread consultation, and the consultation documents were issued last July, so we have had a considerable period in which to consider them. However, I do not see any particular outstanding reason why we should have a further, prolonged period of debate before introducing the legislation so that the House can consider it line by line and in detail, in the proper scrutiny process that is needed.
    Mr. A. J. Beith: Bearing it in mind that the Lord Chancellor will have to remain in office until certain of these processes are complete, can the Minister give us an approximate date—or even a year—by which he expects the supreme court to be sitting in its own building and the judicial appointments commission to be appointing judges?
    Mr. Leslie: That is a simple question but, obviously, the answer depends not only on the date of Royal Assent for the legislation but on when we identify the future building for the supreme court. Both matters depend on various factors, some of which are commercial—in regard to whether we refurbish a building or build a new one—while others are connected to the passage of
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    legislation through Parliament. However, I anticipate that we should be able to make progress in the next couple of years and see such matters settled in good time.
    David Winnick: Is my hon. Friend aware that, far from criticising the plans that have been announced, we need to take further radical steps, here and in the other place? We must bring ourselves up to date. Parliament ensures the civil liberties of all our citizens, but that is no reason to worship what has occurred over centuries. Modernisation is essential.
    Mr. Leslie: My hon. Friend is right, and implicitly highlights the obvious conservatism of the Opposition, who have opposed themselves to any change, no matter how obvious and rudimentary it appears to the rest of the country. They think that Westminster is happy with the current arrangement, that the establishment is content with it, and therefore that no change is necessary. However, we believe that we must make sure that our constitution has clarity and transparency, so that it can be understood by the wider public. We must also ensure that we have a justice system that serves the public's needs.
    Mr. Nick Hawkins: Does the Minister recognise that the Government are indulging in dangerous constitutional tinkering, and that they have caused great anger through such proposals as the idea of calling the presiding officer of the other place the Lord Speaker? That move would be dangerous and confusing. Have not the Government in recent days accepted not one or two, but 12 Opposition amendments in another place to replace the title of Secretary of State for Constitutional Affairs with the original title of Lord Chancellor in the Domestic Violence, Crime and Victims Bill? The Government are really in a terrible mess. Would it not be better to keep the historical role of the Lord Chancellor, which works?
    Mr. Leslie: I take that as a commitment that the Conservatives will put it in their manifesto that they will repeal any changes and reinstitute the office of Lord Chancellor. Is that what the hon. Gentleman is saying? I can hear no response whatever from him—
    Mr. Speaker: Order. I say to the Minister that no response is necessary. The Minister is there to answer a question.
    Mr. Leslie: It is important that we do answer that question. There are several important issues involved, including whether the second Chamber chooses a different title for the person who presides over its business, but that is a matter for the second Chamber itself to debate. We will be careful to make opportunities to listen to what it says on that. The fact that there have been a number of amendments to a Bill in the other place is almost irrelevant, given that we will have the constitutional reform Bill, which will make all the necessary changes to previous legislation when it is passed. The principles are clear, which is what the hon. Gentleman refuses to address.
    David Taylor: I congratulate my hon. Friend on a rare ministerial victory over Jeremy Paxman last night on this issue. He performed superbly. Does my hon. Friend agree with the Lord Chief Justice that there could be a threat to judicial independence because future judges whose decisions offend Governments might be disciplined, moved to other work or denied promotion? Should there not be legislation to protect their independence?
    Mr. Leslie: Following extensive discussions with the Lord Chief Justice about the constitutional reform Bill, I am pleased to say that he has mentioned in a speech to the other place that he agrees with the process of changes now in train. For that reason, we shall put into the Bill provisions to ensure that the Secretary of State has a duty to uphold and maintain judicial independence, and that the Government as a whole have to respect that independence. Those are positive steps forward, and I know that my hon. Friend will welcome them.
    Mr. John Burnett: If the office of Lord Chancellor is abolished, does the Minister believe that there should be an objective voice in Cabinet at all times to safeguard the interests of justice? Does he also believe that that role should be undertaken by the Attorney-General, who would then have to attend not selected Cabinet meetings but all of them? Does the Minister then believe that the Attorney-General should be a voting or non-voting member of the Cabinet?
    Mr. Leslie: Thankfully, the composition of the Cabinet is a matter not for me but for the Prime Minister. The hon. Gentleman asks who should have the role of defending judicial independence. I believe that it should be the Secretary of State for Constitutional Affairs. That is our proposal, and we shall put it into the Bill. I hope that that will go some way towards satisfying the hon. Gentleman.

    Citizens Advice Bureaux
    Huw Irranca-Davies: What assessment he has made of the work of citizens advice bureaux in relation to legal advice provided to members of the public. [153652]
    The Parliamentary Under-Secretary of State for Constitutional Affairs (Mr. David Lammy): The citizens advice bureaux and other not-for-profit agencies have an important role to play in the community legal service and in increasing access to legal and advice services for people experiencing social welfare problems. During 2003–04, the Legal Services Commission contracted with 239 CABs. The contracts were valued at more than £25 million.
    Huw Irranca-Davies: The Minister will join me in applauding the work of the citizens advice bureaux throughout the UK, not least the offices in Maesteg and Bridgend, which reach out to all parts of Ogmore. However, may I draw his attention, with some concern, to a report published last week that suggested that parts of Wales were an advice desert, with people having to
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    travel up to 50 miles to reach advice from a lawyer? Does he agree that the long arm of the lawyers should stretch a little further?
    Mr. Lammy: I commend the work of the CABs in Bridgend. At this very moment, the LSC is involved in a contract bidding round with solicitors and CABs that want to provide legal aid services in Wales, and it believes that, as of April, some of the gaps that have been identified will be closed. I visited Wales a few months ago and looked at the telephone advice service that Shelter was providing on social welfare and housing issues. We have to look increasingly at other ways of providing advice, particularly in rural areas, and telephone advice will be one of those methods.
    Mrs. Jacqui Lait: Many CABs provide excellent services throughout the country, but is the hon. Gentleman aware that the inept local government settlement is making local authorities look closely at the donations that they make to charities, which will also affect the CABs? Is he concerned that some of those services might have to be withdrawn?
    Mr. Lammy: The citizens advice bureaux receive more than £116 million of public funding every year. That is more than they have ever received before, and on this side of the House, where we support the Attlee Government's establishment of legal aid, we shall of course continue to support citizens advice bureaux.

    Judicial Appointments Commission
    Vera Baird: What the system for monitoring and appraisal of judges will be after the introduction of the judicial appointments commission. [153653]
    The Parliamentary Under-Secretary of State for Constitutional Affairs (Mr. Christopher Leslie): The judiciary is responsible for its own system of monitoring and appraisal, in line with the principles of judicial independence. However, in cases in which conduct or discipline may be an issue because of incapacity or misbehaviour, the Secretary of State and the Lord Chief Justice will work together, supported by a complaints secretariat.
    Vera Baird: I thank my hon. Friend for that answer. He must be aware that there is no effective system for monitoring and appraisal of judges. For example, he may know of recent publicity about 25 or so criminal judges who are appealed four or five times as often as their colleagues and frequently criticised by the Court of Appeal, but nothing is done to improve their performance. Does he agree that it is essential to ensure that judges are not only independent, but competent and that a proper system must be introduced to guarantee that by, I suggest, the judicial appointments commission?
    Mr. Leslie: I do not think that the judicial appointments commission would be the right body to be involved in post-appointment issues related to complaints and discipline, as there could be a conflict of interest. It is important that the judiciary has a

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    monitoring and appraisal system, and my hon. and learned Friend raises a fair point. It would not be right for the political process to be involved in the day-to-day reporting of appeals and so forth because that would effectively represent a level of political interference. The judiciary and judges are, of course, not only accountable through the appeal process: they make their decisions in public, they give their reasons and their decisions can be open to appeal so that mistakes can be corrected. I know that the judges will listen to her point about the judiciary having a good monitoring and appraisal system.
    Mr. Alan Duncan: May I invite the Minister to study page 53 of this week's Gay Times? Perhaps he cannot normally reach the top shelf to see it. It says:
    "The second gay judge is appointed",
    and gives all the details. Under our existing system, that happened perfectly sensibly, it has been reported and that is fine. I consider it good news. Were the Government's proposals to be enacted, choosing such people would be seen as fulfilling the requirement that appointments must be, to quote from the Minister's consultation document, "reflective of society". If someone appointed under his proposed system were gay, female, disabled or black, the inevitable next step would be a public assessment of whether their judgments in court were consistently reflective of the appointment criteria. That is nothing to do with justice and would amount to the politicisation of judicial decisions. Does the Minister now understand that the requirement for any judicial appointment to be reflective of society will lead inevitably to demands for judgments also to be reflective? Will he now undertake to drop any such references from the forthcoming Bill?
    Mr. Leslie: It is a great pity that the hon. Gentleman seems to think that if we want merit as the sole criterion for appointment, it is somehow incompatible with achieving diversity. I see no incompatibility whatever in making sure that the judiciary is better reflective of our wider society and seeing that merit is the sole criterion. If he thinks that people who are not currently represented among the judiciary cannot be meritorious candidates, he needs to reconsider his perspective.

    Courts (East Anglia)
    Mr. Henry Bellingham: When he next expects to meet representatives of the local magistracy to discuss the modernisation of courts in East Anglia. [153654]
    The Parliamentary Under-Secretary of State for Constitutional Affairs (Mr. David Lammy): There are no plans to meet representatives of the local magistracy in East Anglia to discuss the modernisation of courts in East Anglia. That could be arranged, however, if it would prove useful.
    Mr. Bellingham: I am grateful to the Minister for that helpful reply, as it may well be useful. Does he agree that justice needs to be kept as local as possible to have maximum impact? Does he also agree that young offenders in East Anglia are much more likely to be deterred if they are tried in their local town by local
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    people? Will he therefore concentrate on modernising existing courts and not close any more magistrates courts anywhere in East Anglia?
    Mr. Lammy: The hon. Gentleman asked the very same question in September and on three occasions previously. On that occasion, I replied:
    "It is right and proper that magistrates live locally, but it is clear that we cannot have courts in every town." —[Official Report, 9 September 2003; Vol. 410, c. 163.]
    In the last two years of the previous Conservative Administration, 42 courts were closed. I am pleased that we closed only 11 last year.

    House of Lords
    Bob Spink: What estimate he has made of the level of support for a wholly elected House of Lords. [153655]
    The Parliamentary Under-Secretary of State for Constitutional Affairs (Mr. Christopher Leslie): When Parliament voted on the composition of the second Chamber last year, both Houses rejected the "wholly elected" option, in the Commons by 289 votes to 272 and in the Lords by 329 to 106. Because no consensus was reached, the Government are drawing up proposals enabling us to make progress where we can, including a proposal for the removal of the remaining hereditary peers.
    Bob Spink: Last week the Prime Minister wanted no democratically elected element at all. What is his view this week?
    Mr. Leslie: If the hon. Gentleman catches your eye, Mr. Speaker, he will be able to ask the Prime Minister at Question Time, but this is the Government's view: we want a further debate after consideration of the Bill, because we do not want the door to be closed to composition considerations. It is important for us to look to the future and at other options, such as indirect elections. The key issue is the need to reconcile Commons primacy with the need for more legitimacy in our second, revising Chamber. If we can achieve consensus on that, perhaps further reform will be possible.
    Andy Burnham: I do not know whether the Minister, like me, is a Billy Bragg fan, but is he among the growing number of people who feel that his secondary mandate proposal, whereby the House of Lords would be comprised proportionally and indirectly according to the share of the vote at general elections, is the answer to the question of Lords reform? Would not that system combine election and appointment with the advantages of both, reassert the primacy of this House and, crucially, give people more of an incentive to vote?
    Mr. Leslie: I know that my hon. Friend is a vocal advocate of the secondary mandate, which is indeed worthy of consideration. We need to ensure that this House is seen clearly as the democratic chamber—that it

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    is plain that we are accountable, and this is where the buck stops when it comes to decisions and responsibility in our constitution. But if we can find a way of improving the legitimacy of our revising chamber by other means, suggestions to that effect will merit further consideration.
    Mr. Andrew Mitchell: Does the Minister agree that we have far too many elected politicians in this country already? They are elected at European level, to this place, at regional level and at metropolitan. county, district and parish level. If he or any of his hon. Friends are really saying that we need more elected politicians—if that is the answer to the question—many of our constituents will want to have a very good look at what the question is.
    Mr. Leslie: That is a strange argument. Presumably in that case the hon. Gentleman would prefer hereditary peers to be retained in the revising chamber. But if he does not want that, he will obviously support our Bill when it is presented to Parliament.
    I believe that we have a duty to consider seriously what the composition of the second Chamber should be, but given that there was no consensus last February we must make progress where we can, and remove the hereditaries from the second Chamber.

  The Leader of the House was asked—
  LEADER OF THE HOUSE

    Parliamentary Business
    Mr. Michael Jack: What analysis of the way in which time is used in conducting House business is to be carried out by his office. [153632]
    The Leader of the House of Commons (Mr. Peter Hain): My office keeps a watching brief on the way in which the House conducts its business, and I am always open to suggestions from Members on how it could be better arranged.
    Mr. Jack: I note the work undertaken by the right hon. Gentleman to review our sitting hours. May I have a reassurance that, before reaching a firm and final conclusion, he will think carefully about how the House uses its time? On occasion, debates are kept going simply because a Division has been predetermined, although if discussions could have taken place earlier, better use could have been made of Parliament's precious debating time, and perhaps two items of business could have been dealt with rather than one. Will he consider that and the procedures of the House to ensure that we make the best possible use of our time and facilities in determining when the House sits?
    Mr. Hain: I understand the right hon. Gentleman's point, which he made with force. The difficulty lies in balancing Members' desire for predictable timing of
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    votes so that we can all arrange our work accordingly with avoiding the spinning out of debates which, as the right hon. Gentleman implied, sometimes occurs. I am certainly willing to consider all good suggestions from him or anyone else.
    Mr. Stephen McCabe: I am delighted to hear that my right hon. Friend is always open to suggestions. Is he aware of the growing body of opinion that the change in the Tuesday hours has not been wholly satisfactory? Were the recent arrangements to be modified, would he consider whether those for Tuesday could revert to something similar to the previous system, without in any way damaging the other modernisation initiatives?
    Mr. Hain: I am happy to assure my hon. Friend that I will look closely at that and other suggestions; indeed, I have my ear bent regularly about such matters. It is a listening ear—I know that the next question addresses the same issue—and I want to achieve a position whereby everyone is not dissatisfied with the outcome, even if everyone is not wholly satisfied.
    Mr. Oliver Heald: Does not the analysis that my right hon. Friend the Member for Fylde (Mr. Jack) mentioned show that the Leader of the House is simply not providing adequate time to debate the really important issues? I shall give three examples. When I asked the Leader of the House for extra time to debate the Higher Education Bill, he refused. As a result, many Members missed out, yet during the same week we had a debate on truancy that nobody attended.
    Mr. Kelvin Hopkins: I did.
    Mr. Heald: Well, seven Members attended, all of whom were photographed on the front page of The Times. I asked him for extra time to debate the Hutton report, but he refused. Only half the Members who wanted to speak got in that day, yet in the same week we finished early on Thursday and Monday. I asked for more time for the local authority finance debate, but he refused, and not a single Conservative Back Bencher had an opportunity to speak. Is it not time that he ensured that business management has priority over the news management in which the Government are engaging?
    Mr. Hain: As the hon. Gentleman knows. under the existing sitting hours we have in fact spent more time scrutinising Commons business than in the previous year. On the specific points that he raised, he pressed for two days' debate on the Hutton report, but when it was published and he and others realised what its contents were, at the previous day's business questions he did riot press the matter again, even though I reminded him about it. When he looks at what really happened, he will see that all these measures had plenty of time for scrutiny, as such measures have always had in the past, under Governments of all colours.
    Joan Ruddock: What plans he has to take private Members' Bills after 7 pm on Tuesdays. [153633]
    Mrs. Janet Dean: What plans he has to take private Members' Bills after 7 pm on Tuesdays. [153636]
    The Leader of the House of Commons (Mr. Peter Hain): I am aware that many Members favour this option, which the Modernisation Committee will consider as part of its review of sitting hours.
    Joan Ruddock: Does my right hon. Friend accept that even London Members such as me have to make constituency appointments for Fridays many months in advance to accommodate all the demands? The result is that Members, and indeed Ministers, often find a conflict between local loyalties and having to attend this House for a private Member's Bill. Does he agree that, if such Bills were taken on a Tuesday evening, more Members could participate in those vital debates, and constituents could be certain that their Member of Parliament was available on a Friday?
    Mr. Hain: My hon. Friend makes her case persuasively, and hers is one of the many arguments being put to me about how we could adjust the existing sitting hours that meet with widespread consent. Many Members, including her, have said to me that moving private Members' Bills to Tuesday evening would have the advantage of freeing up Fridays for constituency business, and would perhaps allow such Bills to be debated by more Members than are currently able to turn up on Fridays. There are counterbalancing arguments, and it is precisely this issue that I want to look at more closely.
    Mrs. Dean: Does my right hon. Friend also agree that, besides freeing up Fridays, moving private Members' Bills to Tuesday evenings would also allow more time for consideration on Tuesdays of Select Committee reports and other non-voting business?
    Mr. Hain: Again, that suggestion has been made to me in recent weeks, and I am looking at it very seriously. It struck me during my extensive consultations in recent weeks with Members of all political persuasions, and Ministers, that very few people are now arguing for going back to the old hours on Wednesdays. [Interruption.] Well, some may be, but there is not a large body of Members doing so. I am simply reporting to the House my findings in the light of such consultations. However, there is a focus on Tuesdays, and if we could reach agreement on how to handle Tuesdays, and if there were widespread consensus—I am not saying that we need unanimity—there would be
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    a case for having an early vote on the matter. However, if there is not a consensus, I do not want to rush into a vote, leaving behind a bitter division on the hours, so we need to continue our discussions. In doing so, we can take into account the views of my hon. Friends the Members for Burton (Mrs. Dean) and for Lewisham, Deptford (Joan Ruddock).
    Sir Nicholas Winterton: Does the Leader of the House accept that the findings of the questionnaire issued by the Procedure Committee, which I chair, will give good guidance to him and the House on future sitting hours? Does he agree that the Procedure Committee's report on "Procedures for Debates, private Members' Bills and the Powers of the Speaker" is an important report? Will he tell the House when hon. Members will have an opportunity to debate that report, which was published towards the end of last year, on the Floor of the House?
    Mr. Hain: I am always up for good guidance from the hon. Gentleman and I usually get it and am grateful for it. We are examining the Procedure Committee report and I want to reflect on it further. I also believe that the survey will be valuable in informing the investigations of the Modernisation Committee and, in the meantime, it will help inform me about how the feeling in the House is spread. I am already getting a pretty good idea from the regular verbal representations made to me, not to mention the discussions that I have in my office, including one that the hon. Gentleman attended, if I recall correctly.
    Mr. Paul Tyler: Reverting to Tuesday evenings, does the Leader of the House recognise that there is a demand from both sides of the House to ensure that we have enough time for proper scrutiny of private Members' Bills? If we allocate consideration of such Bills to Tuesdays, can he assure me that the aggregate total time available will not be a reduction on the current position? If anything, we need more time to be able to do the job properly, particularly given the raised expectations among the public about the importance of private Members' Bills, which are not being met by the current method of delivery.
    Mr. Hain: When the proposition was first put to me, the 13 Fridays allocated for private Members' Bills equated to 22 Tuesday evenings for an exactly similar time. Of course, there are about 36 Tuesdays in a calendar year, so there is an issue to be dealt with there. However, I do not disagree for one moment that private Members' Bills deserve a fair wind and proper scrutiny. It is one of the arguments being put to me, but, as I have already said, some counterbalancing arguments are also being put to me by business managers, Ministers and others who argue that the hon. Gentleman's preferred method is not a satisfactory way of proceeding. It is one of the issues that I shall have to bottom out.

BILL PRESENTED
  SLEEP APNOEA
  Alice Mahon, supported by Mr. Tam Dalyell, Mrs. Betty Williams, Mr. Michael Clapham and Mrs. Ann Cryer, presented a Bill to make provision about sleep apnoea and related medical conditions: And the same was read the First time; and ordered to be read a Second time on Tuesday 27 April, and to be printed. [Bill 50].

  Health and Safety at Work (Offences)
  12.32 pm
  Mr. Andrew Love: I beg to move,
  That leave be given to bring in a Bill to make provision about the prosecution and punishment of offences which are, or are treated as being, offences under the Health and Safety at Work etc. Act 1974 or the Employers' Liability (Compulsory Insurance) Act 1969.
  Thirty years ago, throughout 1973 and most of 1974, I worked as a labourer on the M1 extension in London, and my abiding memory of that time is of the very shoddy, to say the least, working practices on the site. That brought home to me personally the importance of health and safety at work, and the very strong reasons why the scandal of health and safety failures led directly to the Health and Safety at Work, etc. Act 1974. This year marks the 30th anniversary of the original Act—a piece of legislation that has served not only working people but the wider community with great success.
  Working as a labourer on a building site, or on the shop floor, can be hazardous, and the work environment has historically been plagued with injuries and work-related ill health. Although the 1974 legislation was a considerable achievement, we now need to re-engage on a number of important work issues to revitalise and renew the legislation, which has, perhaps not surprisingly, become out of date after 30 years.
  In the 21st century, most employees naturally expect working life to be, if not exactly comfortable, at least safe. Employees have a right to expect not to be maimed or laid off for life, and they are certainly entitled to expect that their place of work will not lead them to an early grave. A recent Health and Safety Executive national statistics study for 2002–03 revealed that the number of work-related fatalities fell to 226 in that year, from 251 in the previous year. The same study shows that, while the rate of work-related fatal injury is roughly what it was three years ago, it is around one third of the rate recorded in 1981. Most of that success can be put down to the impact of the 1974 Act, but those involved in health and safety recognise that the legislation must reflect the realities of today's workplace. That can be done by strengthening the penalties for those responsible for taking unnecessary risks with safety on sites and in workplaces across Britain.
  Occupational health and safety is an integral part of workplace well-being. We live in a world of greater uncertainty and risk than was the case in 1974. My Bill would meet public concern by amending the 1974 Act to increase the penalties for offences. It would do that in two ways. First, it would raise the maximum fine from the present level of £5,000, which is now out of date, to £20,000. Secondly, it would introduce the possibility of a custodial sentence for the most serious breaches of health and safety regulations.
  I believe that these measures, which were first identified in the Health and Safety Commission report entitled "Revitalising Health and Safety", launched by my right hon. Friend the Deputy Prime Minister in June 2000, will address health and safety concerns in workplaces across Britain. We all know of many good

  1271
  companies and safe workplaces that operate good health and safety policies. Sadly, we also know of bad companies, or at least have heard of poor companies with bad health and safety track records.
  In 2001, 295 workers lost their lives as a consequence of work-related activity. That is unacceptable, and the cost in human terms is immeasurable. In 2002, more than 1 million people were injured at work, while approximately 2 million suffered from ill health caused by work. That level of death and injury is caused because health and safety concerns are being ignored, and because the law is being broken in many cases.
  One example concerns a company and one of its directors, prosecuted following an HSE investigation into allegations that the company had not tested its crawler cranes, and that test certificates had been fabricated and offered to other companies' clients as proof that the tests had taken place. In his summing up, the judge in the case remarked:
  "Were prison an option that was open to me, today you would be going to prison, because there is no offence to my mind which is more grave than a managing director of a company of this kind signing"
  certificates
  "one after another, purporting to have examined a crane and not having done so…I sincerely hope that Parliament will look again at this legislation and amend it to allow the sentencing judge the option of a custodial sentence."
  We need to act to ensure that the hard-won improvements in health and safety continue to reduce the rates of work-related injury and death. We have been reminded, in the most tragic terms, of the need for an effective health and safety regime. At Morecambe bay last Thursday, 17 men and two women died at the hands of unscrupulous gangmasters operating outside the law.
  My Bill is simple and straightforward, as it follows basic common sense. It is supported by the TUC, many trade unions—including my own, the Transport and General Workers Union—and the CBI. Any employer in breach of the 1974 Act should pay a fine commensurate for that breach. We need to get tough on breaking safety laws, and the Bill's principal provisions
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  would raise the maximum level of fines for most health and safety offences. For the more serious offences, the Bill makes it possible, for the first time, to impose custodial sentences on the most recalcitrant employers.
  It is important to note, however, that the Bill would not change the requirements on business; companies complying with the law will not be affected by changes in the criminal penalties available to the courts. The Bill also recognises the need to improve the situation as regards employers' liability insurance, especially the implications of increases in that insurance if some firms thought they would be better off not taking out insurance at all. My Bill would ensure that good employers continue to be supported and helped, and that they are not undermined, but that bad employers face stiffer penalties. It recognises the need to reflect the realities of today's workplace; it will encourage good practices and punish bad ones.
  I cannot close my remarks without pointing out the contribution made by other Members to the health and safety at work agenda. My hon. Friends the Members for Scarborough and Whitby (Lawrie Quinn), for Barnsley, West and Penistone (Mr. Clapham), and for Aberdeen, North (Mr. Savidge) have worked assiduously in the all-party group on occupational safety and health to raise those issues in the House.
  I commend the Bill to the House. It will make a significant contribution to improving standards in the workplace and to getting rid of cowboy practices. It will create conditions for good health and safety and provide a modern legal framework to encourage best practice.
  Question put and agreed to.
  Bill ordered to be brought in by Mr. Andrew Love, Jon Cruddas, John Cryer, Lawrie Quinn, Mr. Colin Breed, Ian Stewart, Mr. Richard Allan, Mr. Malcolm Savidge, Mr. Michael Clapham and Tony Lloyd.

  Health and Safety at Work (Offences)
    HEALTH AND SAFETY AT WORK (OFFENCES)
    Mr. Andrew Love accordingly presented a Bill to make provision about the prosecution and punishment of offences which are, or are treated as being, offences under the Health and Safety at Work etc. Act 1974 or the Employers' Liability (Compulsory Insurance) Act 196: And the same was read the First time; and ordered to be read a Second time on Friday 12 March, and to be printed [Bill 51].
  Opposition Day
  [4TH ALLOTTED DAY]
  Opposition Day

    The Environment
    Mr. Speaker: I inform the House that I have selected the amendment in the name of the Prime Minister.
    12.43 pm
    Norman Baker: I beg to move,
    That this House believes there should be an annual debate in Parliament on the state of the environment; notes that sustainable development and the issue of climate change is fundamental to the long-term security and stability of the world; is very concerned that climate change could, according to leading international scientists, cause the extinction of one million species by 2050, could, according to the World Health Organisation, mean an additional 150,000 people dying each year, and is, according to Sir David King, the Government's Chief Scientific Adviser, "the most severe problem that we are facing today, more serious even than the threat of terrorism"; welcomes the Government's ratification of the Kyoto Protocol and their pledges to help meet its targets, particularly the Energy White Paper commitments to renewable energy and energy efficiency; notes however the worrying trends in key domestic environmental indicators with, since 1997, total municipal waste up by 17 per cent, road traffic up by 8 per cent, domestic energy consumption up nearly 7 per cent, high level radioactive waste up 6 per cent. and energy consumption from aviation up 21 per cent; acknowledges that investment in environmental protection and innovation benefits the whole economy and creates jobs, and calls on the Government to make better use of economic instruments to this end; and believes the Government needs genuinely to put the environment at the heart of government and to take a greater role in promoting sustainable development, and that this requires a clear lead from the Prime Minister.
    This year, there have been two startling stories which should cause us all to reflect. The first was a statement by Sir David King, the Government's chief scientific adviser. Writing in the journal Science, he said that climate change was
    "the most severe problem that we are facing today, more serious even than the threat of terrorism".
    It will not have escaped the House's attention that, while a great deal of our time is spent on terrorism, not very much of it is spent on climate change. The second was a report by a group of leading international scientists, warning that between 15 and 37 per cent. of all species could be extinct by 2050—a frightening statistic.

    I shall return to the substance of those matters shortly, but first may I express my regret that the House has not held a full debate on the environment for a long time? The last such debate was on 15 May 2002 and, as on this occasion, it was on a Liberal Democrat motion. The debate was held during the run-up to the world summit on sustainable development. Since then, there has been no debate on the environment in Government time. It is true that there was a debate on the report of the Environment, Food and Rural Affairs Committee on the work of the Department, but that debate was held in December 2002 and was mainly agriculture-focused.
    In Parliament, we need to give the environment the focus that it deserves, and the present ad hoc arrangements are not delivering that. That is why our motion suggests that the House should hold an annual
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    debate on the environment. If the Government do not give the lead and facilitate that, then Liberal Democrat Members will.
    Sir Sydney Chapman: I share many of the sentiments expressed in the hon. Gentleman's motion. The problem is that if we have an all-suited environment debate for one full day a year, it will cut out opportunities to debate important environmental issues that arise from time to time. For example, as chairman of the Council of Europe Sub-Committee on Sustainable Development, I am anxious to debate sustainable development, but if his proposal were adopted, such a discussion might have to form part of a wider environmental debate. Has he thought about that point?
    Norman Baker: I understand the point, which the hon. Gentleman is right to raise. We have an annual debate on defence, but it does not stop us debating defence throughout the rest of the year. I hope that an annual debate would raise understanding among Members and encourage further discussion of the environment throughout the year—the opposite effect to that which he fears.
    Mr. John Randall: The hon. Gentleman mentioned defence debates, of which there are normally three a year. Perhaps his motion is unambitious and there should be different debates on different aspects of the environment.
    Norman Baker: I would welcome three debates on different aspects of the environment, but I would settle for one if the Government were to concede the point. The Government have not called such a debate for a long time.
    I am disappointed that the Secretary of State for Environment, Food and Rural Affairs is not with us today. The sad fact is that she has not participated in any debate even partly related to the environment since 2002, and March 2002 was the last time that the Government volunteered even an oral statement on an environmental issue. I happen to think that the Secretary of State is sound on environmental issues, but I cannot say for certain and we must read the signals—it is like watching the Soviet Politburo. We do not know definitely, but in so far as we can tell she is sound. Why is she not in the House more regularly attending debates called in the Government's name to champion the cause of the environment? We would welcome that, but it does not happen. Perhaps the truth is that her views, which may be sound, are out of line with those of the Government in general, who rank the environment low down their list of priorities.
    Gregory Barker: The hon. Gentleman says that he has time for the Secretary of State, but can he think of a single area in which she has sounded her ambition to leave an imprint on the Government's environmental record by doing anything that is in any way out of kilter with what has happened before? Has she shown personal commitment to this important issue, as opposed to just being a safe pair of hands?
    Norman Baker: Tricky questions first. If we believe what we read in the press and consider the smoke

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    signals, the right hon. Lady was responsible for ensuring that the Government's Kyoto target was not downgraded by 15 per cent., which the Secretary of State for Trade and Industry apparently wanted. The Minister for the Environment is nodding, so that suggestion is correct.
    The Minister for the Environment (Mr. Elliot Morley)indicated dissent.
    Norman Baker: The Secretary of State for Environment, Food and Rural Affairs seems to be quite good at defending her budget, although I would not want to overplay that point. She is a friend of the environment—in so far as we have one in this Government—so let us not be too unpleasant about her because we need her on board to help us.
    I listened in vain to the Queen's Speech introducing this Session for a mention of the word, "environment", and it appeared once:
    "the new strategic environment in which the Armed Forces operate." —[Official Report, 26 November 2003: Vol. 415, c. 7.]
    It appeared, but not in the context that many of us would have wished.
    Mr. Colin Challen: The hon. Gentleman is making great play of the word "environment", as though someone who does not mention it cannot be doing the right thing by the environment. What about the Energy Bill, which is surely a major step forward? It proposes difficult targets on, for example, renewable energy sources.
    Norman Baker: The Energy Bill has a number of good elements—I was about to be nice about it—and I shall go on to discuss domestic policies. It is important to paint a fair picture so that one can criticise after having praised other matters.
    Mr. Michael Weir: Before the hon. Gentleman is too kind about the Energy Bill, does he share the views put forward by the Scottish renewable industry, which has expressed grave concern about the costs associated with tapping into the national grid? Many developments by the Scottish renewable industry are located in the far north of Scotland on the islands, and it will be expensive to connect them to the national grid, which has led the industry to raise concerns about the future of renewables.
    Norman Baker: The renewable target in the White Paper is welcome. Access to the grid is a serious issue. In many cases, power supplies are offshore, a long way from centres of population, and that is a matter that my hon. Friend the Member for Gordon (Malcolm Bruce) has raised on several occasions. The Government say that they will address it, and we will see in time whether they do so.
    When the Prime Minister was questioned last week by the Liaison Committee, he gave his usual impressive performance, except when he was asked about the environment. Then his eyes glazed over and we saw a
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    rather different Prime Minister. He was asked whether he agreed with the Government's chief scientist on climate change, and he replied:
    "Looking very long term, if I look at when my children are my age, yes, I think that is the key issue that faces us."
    He was not entirely convincing, and he even forgot the name of the Department represented by the Ministers here today. He gave the impression that the environment was a humdrum issue, as did Mrs. Thatcher before him.
    At least the Prime Minister said that he recognises climate change as an issue for 30 or 40 years' time, but he seems not to realise that it is with us now, and is accelerating. Species are already disappearing, the polar icecaps are melting and we are seeing wild swings in our weather patterns.
    Paddy Tipping: Does the hon. Gentleman accept that our Kyoto targets exceed those of any other country? Does he accept that the UK is the only European country to put forward an emissions trading scheme? Most particularly, does he agree that climate change will be long term? Even if we take steps now, it will be a long time before we change the pattern of the curve.
    Norman Baker: I certainly recognise the Government's commitment to Kyoto and I shall say so later. Climate change may be long term, but it requires action now, and that is what we are not seeing to a sufficient degree. The oil tanker will take a long time to turn round, and we need to start now. We cannot wait for the time when the Prime Minister's children are his age now to realise the catastrophe that awaits us. It is a difficult political issue for all of us. We have to convince the electorate and the wider world about an issue that is not immediately on our doorsteps but which requires immediate action. It will be too late in 30 or 40 years' time.
    The most recent models of climate change from the United Nations Environment Programme suggest that global temperature will rise between 1.4 and 5.8 per cent. by 2100. That is grotesquely in excess of anything that has happened in the past 10,000 years, and there is no guarantee that flora and fauna—let alone human beings—will be able to adapt to such change.
    Mr. Henry Bellingham: I share the hon. Gentleman's concern about flora and fauna. Does he agree with some scientific opinion that suggests that, if the polar icecaps continue to melt at a faster rate, the warm airs from the gulf stream will be greatly weakened and we will have a climate more similar to the deep continental one? In other words, winters in this country could become much colder.
    Norman Baker: That is indeed one scenario, and that is why we now try to talk of climate change, not global warming. What is clear is that we will see significant changes in our weather and climate, and we should not gamble with that—although it appears that we propose to do so.
    There are statistics that support both sides of the debate, but I was struck by the report that more than half of the world's wetlands have disappeared since

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    1900, and that figure will reach 85 per cent. in the next 30 to 40 years. That is an appalling figure. I say that not from soft sentimentality about wetlands, but because managing wetlands sustainably will aid significantly in meeting the targets set at the world summit on sustainable development to halve the number of people without adequate water and sanitation services by 2015. It is a people-centred statistic, as well as a nature-centred one.
    Sustainable use of the planet is inextricably linked to a stable and prosperous future. Many hon. Members will have seen the excellent WWF report "Living Planet Report 2002", which demonstrates all too graphically how we are using up the capital resources of the world faster than they can naturally be replenished. That will lead to an increase in poverty and human misery and, potentially at some time in the future, to resource wars over basic substances, including water. We must try to avoid that.
    It is worth remembering that the poorest countries are likely to be the most vulnerable and most affected by climate change. Some 60 per cent. of the additional 80 million people likely to be at risk from flooding are in southern Asia, and 20 per cent. in south-east Asia. Africa is expected to experience significant reductions in cereal yields, as are the middle east and India. An extra 290 million people could be exposed to malaria by the 2080s, with China and central Asia experiencing the biggest risk. Those are frightening projections. I hope that they are wrong, but if they are anywhere near right, we have a big problem on our hands.
    It is also predicted that 3 billion people, predominantly in Africa, will suffer through increased stress on water supplies. There is an old saying that forests precede man and deserts follow him, and that is becoming all too true. Deforestation is having a devastating impact on the global climate. That is true not only for Brazil and Indonesia, which are the focus of popular concern, but for countries that should know better, such as Australia and what is happening in Tasmania. It is also happening in Africa to a degree that people have not so far appreciated. A parliamentary answer I received from the Secretary of State for International Development suggested that 5.2 million hectares of forest disappeared from Africa each year. That is an area the size of France, and we cannot go on like that. Some 80 per cent. of ancient forests have been destroyed, degraded or fragmented by human activity, and that has a massive impact on biodiversity and threatens to destroy the livelihoods and way of life of millions of forest-dependent people. That is the bleak reality that we face.
    Much of the logging is illegal and many of the products are exported to the UK and other European markets. The Indonesian Government lose an estimated $6,700 a minute in revenue because of illegal logging, but Indonesian companies that rely on illegal logs to feed their sawmills still export plywood to the UK, where it is used once or twice and then thrown away. I welcome the fact that the Government support the European Parliament's resolution on forest law enforcement, governance and trade, which is a good first step. However, it will not stop the illegal timber trade with the European Union. As Greenpeace points out, the plan contains no commitment to legislate against the import of illegally logged timber, but relies instead on
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    voluntary partnership agreements, such as those already in place between the UK and Indonesia. That is clearly not enough.
    We need a sensible approach to public procurement. My hon. Friend the Member for Guildford (Sue Doughty) raised with the Prime Minister the issue of the timber being used for the new Home Office building. Unfortunately, the Prime Minister laughed at the matter, instead of treating it seriously. That is not good enough. I also gently suggest to the Minister that while Government statistics show that we import large quantities of timber from places such as Vatican City, there is some way to go in regulating the timber trade. Surely there are not that many old church pews in Vatican City.
    Climate change will affect us in the UK directly, as DEFRA's own website shows. The most recent climate change scenarios show an average annual temperature increase across the UK of between 2 and 3.5 per cent. by the 2080s, with all the possible consequences that we have heard about, including high summer temperatures and increasingly rare cold winters. However, the changes to the gulf stream may mean colder winters, giving us the temperatures found in Labrador. The US National Academy of Sciences has even described such changes as "likely". That may be the worst-case scenario, but even alternating between colder and warmer temperatures for several decades would play absolute havoc with agriculture and civilisation generally.
    Whatever the shape of the changes, it would be better not to take the gamble that we are taking. This is not an issue for the long term, as the Prime Minister said last week: it is an issue for now. However, I want to give credit where it is due, and the Government did sign up to Kyoto early and willingly. They have set ambitious targets and they are on course to meet the EU target, if not the 20 per cent. target. It is true that some of that resulted from the switch from coal to gas; nevertheless, our Government are on target, and we should be pleased that they have approached the matter responsibly.
    That attitude is in marked contrast to the attitude of our best friends, the United States, which has 7 per cent. of the world's population but accounts for 25 per cent. of all energy use and 36 per cent. of all greenhouse gas emissions each year: they are going up—and going up fast—in the United States.
    I feel sorry for the Prime Minister. He took a big political risk in supporting President Bush in his Iraqi strategy, and he is not being well repaid by the American President over Kyoto or indeed very much else. Either the Prime Minister has not pushed Kyoto very hard with the United States President, in which case he is failing in his duty to do so, or he is being completely ignored by the United States President—in which case, so much for the special relationship. I am not sure which explanation is right, but neither is very flattering to either man.
    The protocol could still become binding if Russia ratifies it. I hope and believe that the Government are doing all they can to persuade Russia to sign up. We have received assurances from Ministers to that effect, and we have no reason to doubt them. That is the right policy to pursue, and I welcome what the Government are doing in that regard. I very much hope that they will be successful.

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    I hope that the Government have also made plain their disagreement with the recent noises from Madrid suggesting that Spain may wish to reopen discussions over Kyoto in the European Union. That needs to he firmly squashed; we cannot afford to allow the EU to unravel over Kyoto.
    I referred earlier to the report by leading scientists suggesting that up to 37 per cent. of species could become extinct by 2050. I am told that that is about one every 45 minutes. I admit that I cannot prove it, but the prediction is probably more reliable than other recent 45-minute claims. Even if the figure were just 5 per cent., that could have a devastating impact on our world. Everything is connected to everything else, and the disruption of natural chains will have unpredictable and unwelcome consequences. Species will face disruption to habitat and may find it impossible to adjust. Even if they can adapt in climate terms, they may find that there is no food to rely on.
    The human race needs to wake up and address the issue. We cannot sit back while a third of all life forms, which have been here for millions of years, vanish in our lifetime, practically overnight in evolutionary terms. That means addressing quickly, not in the very long term, the root causes of this mass extinction, one of which is climate change, which I have mentioned. Another is the inequality in our world and the poverty that drives millions to destroy the land on which they depend as the only way of finding the next meal.
    Global problems require global solutions. They can be found; they can work. We have an example in the Montreal protocol, which has worked quite well in stopping the destruction of the ozone layer. That shows that the world can pull together when it needs to.
    We need Kyoto to work. It may not be perfect—the Americans say that it is not, and they are right to say that—but it is the only show in town and we need it to work. We also need to make international agreements such as the convention on biological diversity much more effective. That runs in parallel with the World Trade Organisation, but while the WTO has teeth the CBD merely has gums. That imbalance needs to be addressed. As the Minister's predecessor suggested, we also need a world environmental court to deal with these issues on a global basis, so that we have environmental and sustainability justice across the world.
    What we do in our own country is important too. In theory, it should be rather easier to achieve. The Government started well in 1997 by creating the right structure—a major Department, the Department of the Environment, Transport and the Regions, bringing together the environment and transport. Many of us in the environment field had argued for that for many years, particularly to try to stop the destructive transport policies that had been implemented until then. The Government also introduced a cross-cutting Environmental Audit Committee. That was absolutely the right policy; the Committee has done sterling work. In addition, the Government introduced a cross-cutting team of green Ministers. I am not sure how effective it has been, but the decision was right.
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    I recognise that the Government look for innovative ways to deal with issues across traditional departmental boundaries, as they should. I give them credit for doing it, even if the price is sometimes more control from No. 10.
    Mr. James Gray: The hon. Gentleman is right to praise the Government for their commitment, but does he not realise that green Ministers were established by my right hon. and learned Friend the Leader of the Opposition when he was Secretary of State for the Environment, in 1992? My right hon. and learned Friend also led this country to Rio de Janeiro for the world summit. Does not the hon. Gentleman also realise that the Transport Department and the Environment Department were intentionally co-located in Marsham Towers, and that there was a good deal of discussion between the two?
    Norman Baker: I did not realise that green Ministers were present in the Conservative Government, which may suggest that they were less effective than that Government might have wished them to be. It is true that there was Rio, and I pay tribute to the right hon. Member for Suffolk, Coastal (Mr. Gummer), who is not here today, who did some sterling work on the environment. However, I am sorry to say that, according to a number of indicators, the previous Conservative Government did not do very well. For example, they had the most appalling recycling record. They had a road-building programme that was the biggest since the Romans, and they had a joke figure for renewable energy. So I would not concentrate too much on the previous Conservative Government.
    I believe that it was a mistake to break up the DETR. I note that the "Greening Government" report stated:
    "Part of the Government's approach to this institutional difficulty"—
    the division between transport and the environment—
    "has been to eliminate one such divide with the creation of the Department of the Environment, Transport and the Regions (DETR). The Deputy Prime Minister described this as 'in itself…a very important step towards achieving the environmental objectives'."
    If it was a very important step towards achieving environmental objectives, why was it split up and abolished? That seems not to make much sense.
    With due respect to the Minister and his colleagues, for whom I have a great deal of time, as he knows, DEFRA is a bit of a throwaway Department. The Minister knows very well that key decisions affecting the environment are nearly always taken elsewhere—at the Department of Trade and Industry, whether on energy policy or trade matters, which are key to environment; the Department of Transport, with regard to aviation or road transport; the Office of the Deputy Prime Minister, for planning issues and key issues about the use of greenfield sites and so on; or No.10 or the Treasury, which is very happy to take decisions on behalf of any Department that it can muscle in on.
    Perhaps that helps to explain why, despite the commitment of DEFRA Ministers—I include the hon. Gentleman's immediate predecessor, of course—the Government's domestic record on the environment is a bit patchy. Many of us had high hopes with regard to

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    transport, for example. The Government came to power accepting at last that we could not build our way out of congestion. We had tried for 100 years and it had not worked. The Deputy Prime Minister even famously pledged himself to road traffic reduction targets and asked us to hold him to them. I happen to think that the Deputy Prime Minister understands transport, with his history in the National Union of Seamen, and that he was sincere when he made that pledge. But he could not have anticipated that he would have the rug pulled so swiftly from under him by No. 10, which is what happened.
    What do we have now? Last week I received a parliamentary answer from the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport (Mr. Jamieson), who told me that road traffic—already up by nearly 8 per cent. since 1997, by the way—
    "is forecast to grow by between 20 per cent. and 25 per cent. in England between 2000 and 2010." —[Official Report, 3 February 2004; Vol. 417, c. 824W.]
    The news that road transport will go up by 20 per cent. to 25 per cent. in this decade comes from a Government who quite recently were committed to road traffic reduction. That is a failure of some magnitude, and it will not help the Government to meet their Kyoto targets. It is not a reduction, as the Deputy Prime Minister promised us. It is not even a reduction in the rate of growth, which is a formula the Conservatives used to use when trying to deal with the issue when they were in government. It is a massive growth and a catastrophic failure of transport and environment policy.
    While industry is busy cutting carbon emissions, emissions in the transport sector are going through the roof. It is not simply road transport, of course. There is also aviation, where I was told in answer to another parliamentary question that carbon emissions, which were 20,000 tonnes in 1990, would double to 40,000 tonnes by 2010.
    Mr. Bellingham: Does the hon. Gentleman agree that there is a dilemma here, because if traffic grinds to a halt there is obviously much more pollution? The Government have got another 1 million passengers on to the railways. Is he advocating the use of other modes of transport, such as aviation, which will create yet more pollution? It is obviously a very complex issue, and he should not try to simplify it in the way that he is.
    Norman Baker: I hope that I am not trying to simplify things. I recognise that this is a complex issue to which there are no overnight solutions, which is why the Government were right to produce a 10-year transport plan. That is the sort of period over which improvements can be delivered, but an election intervened and the Government did not see the policy through—they bottled out in an attempt to get through
    the 2001 election. Transport is now in free fall, or automatic pilot-whatever metaphor is used—and no one is pushing things forward. It seems that the Secretary of State for Transport dare not do anything that would upset anyone, so we have to make the best of things and, in the meantime, market forces take over. Market forces involve lots of people flying on cheap airlines, a massive increase in road transport and an
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    atomised, ineffective rail system. We have not moved on, which is a bitter disappointment for many of us who thought that the Government would do rather better on transport.
    Mr. Mark Francois: There is great concern in Essex about the environmental damage that could result from the proposed extension of Stansted airport. Does the hon. Gentleman agree that it is possible to achieve 40 million passenger movements a year using the existing runway at Stansted? Does he support the action being taken by Conservative-controlled Essex county council to consider submitting the proposal to judicial review in view of the fact that we believe that the Government are wrong and that the people of Essex are right?
    Norman Baker: The people of Essex must make up their own minds about how they wish to take that matter forward. Clearly, there is a strong body of opinion, to which the hon. Gentleman refers. The aviation White Paper relied far too much on predict and provide—a concept that I hoped we had got rid of in transport planning, but it seems not. The Prime Minister did not have very good answers when the Chairman of the Environmental Audit Committee, the hon. Member for East Surrey (Mr. Ainsworth), pressed him on the issue last week. The Government still have to bite the bullet. They cannot please everyone all the time: they must decide on a sustainable strategy and stick to it. They did the first bit; they did not do second bit.
    The recent energy White Paper genuinely embraces the concept of a big switch to renewables and the Government rightly view offshore wind as the first easily attainable tranche of that, but there is a mountain to climb: only 2.5 per cent. of our energy currently comes from renewable sources and most of that is hydroelectricity. That is pitifully lower than other developed countries. It is also important that the Government do all that they can to smooth the way for a transition to a renewable future. That involves sympathetic planning guidance and seeing off the nuclear industry's attempts to discredit wind power, in which it is busily engaged at the moment.
    I must confess that I find it breathtaking to hear those in the pro-nuclear lobby complain about the effect of wind generators on the countryside, when they are busy generating tons of highly radioactive material with a half-life measured in hundreds if not thousands of years. Having just managed to keep the door open to nuclear power in the energy review, the strategy is to try to demonstrate that renewables cannot deliver and to force Ministers back to "safe, reliable" nuclear power—those adjectives are in ironic quote marks.
    Mr. Francois: I thank the hon. Gentleman for his courtesy in giving way to me a second time. He mentions the Environmental Audit Committee, on which I have the honour to serve. The Committee considered this issue in great detail under the previous chairmanship of my hon. Friend the Member for Orpington (Mr. Horam), who is in his place this afternoon, and we found that one of the greatest impediments to renewable power was planning opposition to the development of wind farms in certain localities. Will the hon. Gentleman assist the House with the great dilemma that

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    we found: Liberal Democrat Members are always in favour of wind farms in general, but they always oppose them specifically whenever they are proposed in their own constituencies?
    Norman Baker: That is rather a red herring, an old chestnut and an incorrect challenge. Our policy is to recommend that wind power in general is a good concept. We ought to promote it—most Liberal Democrat councils are doing so—but no one in any party is suggesting that every application for a wind farm should be approved. That is the purpose of the planning process. There is a willingness and a desire to support that concept, which is manifest in Lib Dem councils throughout the country.
    Sue Doughty: The House will be interested to hear that the problem affects all parties. Indeed, a Conservative MSP has opposed wind farms at Huntly. The issue is specific not to parties, but to planning problems.
    Norman Baker: We must not demolish the planning system in considering these important matters.
    Mr. Weir: I thank the hon. Gentleman for giving way to me again. I agree with the hon. Member for Guildford (Sue Doughty). There are difficulties all over the country with specific wind farms, but does he agree that one thing that has not been properly explored so far is offshore wind farms, which would solve many of the problems about siting?
    Norman Baker: I agree, but, having looked at the guidance, I know that it is not that easy for an offshore wind farm proposal to be successful. The Government need to sort out that problem very quickly; otherwise those in the nuclear industry will respond by saying that renewables cannot deliver, and I want to avoid that.
    Let me make it clear that a sustainable future has no place for nuclear fission generation. No one who looks back at the past 50 years of nuclear power can do other than conclude that we would have been better off if we had never started down that road. The power that would be "too cheap to meter"—a phrase from the 1950s—has turned out to be fantastically expensive.
    Curiously enough, a Conservative privatisation proposal lifted the lid and showed just how uneconomic the industry was, but the DTI is now handing out multimillion pound lifelines to British Energy to stop it imploding financially—and still it continues. I was a little unfair to say that the Queen's Speech included no reference to the environment because it included the nuclear industry bail-out Bill, which is currently in the House of Lords and is designed to hand responsibility for gigantic amounts of nuclear waste firmly to the taxpayer in a desperate attempt to make the nuclear industry's books look better.
    Then there are the usual tricks, the latest of which is the racily entitled "Consultation paper on proposals for intermediate level radioactive waste substitution", which was quietly released on the Friday of Hutton week. If that was not an attempt to bury bad news, it was
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    clearly an attempt at least to store it above ground. The thrust of that supposedly independent paper is that we should not necessarily return to the countries whence it came all the waste generated from reprocessing. Why? Presumably it is because that suggestion would enable prices to be cut and business in that doubtful area to be propped up.
    The fact is that we have more than 75,000 cu m of intermediate-level waste lying around in this country, with no clear idea or strategy on how to deal with it. Nirex has no solution. Its last suggestion was pulled and it has not come back with another proposal since, but it now seems to want more of the stuff. The projections already suggest that we will have 107,000 cu m of intermediate-level waste by 2010, and 143,000 cu m by 2030. It seems that we want more waste from other countries to add to that stockpile. However, the author of that report—NAC International—makes some of its money by carrying out work for BNFL. A parliamentary answer that I received yesterday confirmed both that that financial arrangement exists and that the DTI was aware of it before it commissioned NAC to write the report. That is simply not acceptable. That paper is discredited and the DTI should now withdraw it.
    I am pleased that the Government are making progress with energy efficiency: given that domestic energy consumption is up 7 per cent. since 1997, they need to do so. One useful thing that they could do is to support the private Member's Bill introduced by my hon. Friend the Member for Hazel Grove (Mr. Stunell), who came top of the ballot, as the Minister will know.
    Gregory Barker: I wish to ask the hon. Gentleman a question before he leaves the section of his speech that deals with nuclear energy. I share much of his scepticism about the nuclear lobby and agree wholeheartedly that the way in which the Government bungled the latest massive handout to the nuclear industry is very regrettable. but does he want to slam the door on all types of possible research, particularly if in years ahead the prospect of cold fusion could unwrap the potential for new forms of energy, which may be produced without all the hazardous waste that typifies the nuclear industry today?
    Norman Baker: I am bound to say that a great deal of money has gone into nuclear fusion already without very much to show for it. If that money had gone into renewables, we might be rather better off than we are. I would not entirely slam the door on nuclear fusion, but I certainly wish to slam it on nuclear fission for the reasons that I have given.
    Waste concerns me greatly, and no one could think that the Government have performed very well on the matter. The waste hierarchy, which everyone supports, is applied upside down. There is a perverse incentive to landfill and, if not to landfill, to incinerate and only then to recycle—and reuse and waste minimisation get not even a look in.
    Mr. John Horam: Is it not evident that the danger now is that the Government's failure to produce a proper, coherent waste strategy is placing an

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    intolerable burden on local authorities, which simply have no guidance whatsoever to deal with the very difficult planning decisions that they often face?
    Norman Baker: The hon. Gentleman is right: local councils are being driven quickly by the Government to meet the targets required by the landfill directive, but they do not have the policy options or necessarily the resources to do other than probably opt for incineration. That is not the solution that they or the people in their areas want, but that is where we are going. We will end up with a chain of incinerators throughout the country if the Government do not do something quickly.
    We have had one disaster after another from the Government in the waste field. We had the famous fridge mountain about which my hon. Friend the Member for Gordon warned the Minister and his colleagues months before it appeared, although nothing was done. We now have a nationwide breaker's yard of abandoned cars throughout the country, with 238,000 dumped in England and Wales last year. That happened because the Government caved in to the motor lobby and instead of making the industry responsible for vehicles at the end of their lives, as happens in most of Europe, they put responsibility on to the last owners, who have vehicles at their lowest value. What a nonsensical policy that is. Apart from letting the motor industry off the hook, what kind of value does that give to the taxpayer? We paid £14 million last year to clear up abandoned vehicles because the Government took the wrong decision.
    Next, there will be lorries looking for an official site to dispose of hazardous waste. The Government admit that only 37 of the 218 present sites will be available for use for hazardous waste after a EU directive banning co-disposal takes effect in July. However, when my hon. Friend the Member for Guildford raised that matter, the Minister told her that her concerns were premature. There are fewer than six months until the directive kicks in, so I do not call that premature.
    Mr. Challen: That is all well and good, but the hon. Gentleman's speech has lasted three times as long as the Queen's Speech and we are yet to hear a single Lib Dem policy. Are there any?
    Norman Baker: There are buckets of Lib Dem policies, which I shall be happy to speak about for the rest of the afternoon if hon. Members wish to hear them. They are implicit in the comments that I have made. We propose a waste hierarchy that is actually based on the waste hierarchy and that gives incentives to waste minimisation—we desire a zero waste policy. We have a sound energy policy that has no place for nuclear power, is based on energy conservation and efficiency and would give a much better leg-up to renewables than any policy that we have seen from the Government. We have a transport policy based on an increase in cycling, walking and public transport, a reorganisation of the railways and a proper investment strategy to deliver what people want. I assure the hon. Gentleman that we have strategies coming out of our ears.
    Paddy Tipping: While we are pursuing solutions rather than problems, will the hon. Gentleman say a
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    little about the phrase "economic instruments" in the motion? Does he believe in the use of economic instruments, will he give us some examples of them, and does he believe in the principle that the polluter should pay through fiscal measures?
    Norman Baker: Yes, I do believe that and I shall come on to it shortly, although I should probably take no more interventions given the time. The polluter does not pay, as a matter of fact, because figures from the Environment Agency show that only 0.5 per cent. of landfill pollution incidents last year resulted in a fine, despite the fact that there were 285 major incidents. The 100 or 200 operators who did pay paid an average fine of only £6,000, which is a pittance to a landfill operator. The message from the Government is that the polluter does not pay, but gets away with it scot-free.
    Before I address the matter raised by the hon. Member for Sherwood (Paddy Tipping), let me say a few quick words about ghost ships. I would be grateful if the Minister would set out his position on the four ghost ships at Hartlepool. The ships are strange because they were apparently so decrepit that the US authorities demanded that they were dealt with right away. They then miraculously recovered to undertake a sea voyage across the Atlantic to this country, but they have now suddenly become decrepit again and unable to sail back—they are very curious ships. I understand that the official line was that the ships were due to return to the US when spring arrived and weather conditions permitted, yet a letter sent late last year by the Department for Environment, Food and Rural Affairs to British MEPs stated:
    "The UK is satisfied that the ships will be dismantled under environmentally sound conditions, in accordance with planning permission and the waste management licence for the site."
    Has DEFRA now decided that the ships will be dismantled in Hartlepool? How is it possible to pass judgment on the acceptability of the manner of disposal when there are outstanding issues regarding planning permission, the necessary licence and, indeed, the environmental impact? Are the Government pursuing a policy in private that is contrary to the one that they espouse in public?
    Will the Minister deal with the issue of genetic modification when he replies? He will have noticed that our colleagues in Wales and Scotland have taken a rather more robust line on GM matters than the Government here in Westminster. They do not wish to co-operate with GM maize Chardon LL, or T25, which is patented by Bayer. In the light of those decisions in Wales and Scotland, what is the Government's strategy to deal with that matter?
    I now turn to economic instruments, which the hon. Member for Sherwood rightly raised. If we are to have an environmental policy that is delivered effectively, we must have incentives and disincentives in place so that we generate the right behaviour patterns. I received a parliamentary answer showing that in this country, unfortunately, only 2.5 per cent. of taxes, as classified by the Treasury, are raised on environmental matters, which is lower than the percentage in most countries. We have some way to go. It strikes me as mad that if people build on greenfield sites they pay no value added tax, but if they renovate an inner-city building they pay 17.5 per cent.

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    We must create a structure that changes those perverse incentives without increasing the overall tax take—the policy is not about increasing taxes, but using different taxes. Energy saving equipment should incur lower VAT, and compensatory changes should be made elsewhere. We should especially consider how to deal with aviation, because as aviation fuel is not taxed there is a perverse incentive to take the plane, although the environmental solution would be to take the train— especially for internal journeys, and also for cross-channel journeys. On 17 April 2002, the Chancellor said:
    "There is also no necessary conflict between growing the economy and protecting the environment. There is a huge potential for British firms, small and large, to capture new world markets by investing in environmentally friendly technologies and creating new businesses and jobs as a result."—[Official Report, 17 April 2002; Vol. 383, c. 583.]
    That takes things on a stage, and it is important because we must demonstrate to businesses, which are sometimes sceptical about the environment, that investing in the environment can help them to cut their costs, improve their technologies and get them one step ahead of the opposition.
    David Taylor: I know that the hon. Gentleman takes a keen interest in the aviation industry. Will he comment on the fact that best estimates suggest that through not having to pay fuel tax and other taxes, the tax that the industry avoids paying aggregates to about £9 billion a year, which would pay for the whole of the United Kingdom's higher education budget? Is that not astonishing?
    Norman Baker: Yes, a gigantic amount of tax is not paid by the airline industry. Why should the rest of us be deprived of what we wish to do—on health, education or anything else—because that sector is excluded? That is entirely unfair and the Government must address it. I accept that the situation is difficult because of the international agreements and so on, but we must go further and faster than we have.
    People in this country want to help the environment—they have a hunger to do so in many ways. We know how people clamour for recycling facilities in their own patches. The most recent survey on public attitudes on the DEFRA website reveals that 91 per cent. of the population are either fairly or very concerned about environmental issues. Research by WWF says that 8 million people or more are likely to make decisions at the ballot box based on such issues, so they are politically, as well as morally, important, as I have tried to argue.
    I do not want to say that the Government have achieved nothing because they have several achievements. They ratified Kyoto, produced a reasonably good energy White Paper and made welcome structural changes. However, they have not gone far enough. Jonathan Porritt, the Prime Minister's adviser, said:
    "Anybody looking at it dispassionately is going to have a hard job proving that Labour has put the environment at the heart of Government, which is what they claimed they would do."
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    Friends of the Earth said:
    "Although the creation of DEFRA has brought environmental concerns to food and farming policy for perhaps the first time, it has also effectively sidelined the environment as a factor in many other crucial political areas, for example transport, trade, business and planning".
    The Environmental Audit Committee said that the Government are
    "making unsatisfactory progress on environment. The Government has made progress on only two of seven environmental indicators, with progress on the rest being unsatisfactory".
    We need to go further and faster. We have suggested an annual debate on the environment in Parliament to keep a focus on the topic. We welcome some of the Government's steps, but they need leadership from the top. We do not think that leadership is coming from the Prime Minister because he does not act as though he is interested in the topic at all. Perhaps that is why the best efforts of certain Ministers—the Minister for the Environment and his predecessor especially—do not always bear fruit as they should. The Government must ensure that the environment is at the heart of things, not out on a limb.
    1.29 pm
    The Minister for the Environment (Mr. Elliot Morley): I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:
    "applauds the leadership and commitment on the environment shown by the Government domestically and globally; welcomes the UK's climate change programme which has already put the UK on track to overshoot its Kyoto target of a 12.5 per cent. cut in 1990 levels of greenhouse gas emissions by 2012; commends the introduction in the UK of the world's first economy-wide emissions trading scheme; further welcomes the long-term improvement in air quality and steps to improve local environmental quality generally; notes that river and bathing water quality is the highest on record; congratulates the Government on achieving a household recycling rate of 15 per cent. in 2002–03 and being on track for 17 per cent. for 2003–04; further congratulates the Government for playing a key role in the Convention on International Trade in Endangered Species (CITES), increasing protection for a number of endangered flora and fauna; recognises that there is still much to do to promote sustainability at all levels; and calls upon the Government to continue to put environmental protection, locally, nationally and globally at the heart of its policies."
    That was an interesting run through a range of environmental issues and the hon. Member for Lewes (Norman Baker) took a fair approach, to the extent that he acknowledged that the Government have made a lot of progress with a range of environmental issues. We can be proud of measures that command widespread support. This is not a partisan issue because there is a great deal of commitment and interest from all parts of the House and all sections of public opinion. It is easy to be glib about some of the challenges, and I am the first to acknowledge that while the Government can point to real progress and achievements, there is much still to do.
    In principle, I am not against an annual debate on the environment. Why just one debate? The Government, DEFRA and I have all been strong on integrating environmental priorities right across Government strategies and policies. I would not want the environment to be the subject of an annual debate, then for it to be thought that we had "done" the

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    environment, and I am sure that that is not the hon. Gentleman's intention. Given the increased, scrutiny, Select Committees and improved facilities for Adjournment debates that the Government have put in place, there are many opportunities for the House to discuss, debate and scrutinise environmental issues—which also touch on the Treasury, trade and health, and the whole range of government functions.
    I must defend my right hon. Friend the Secretary of State because no one doubts her commitment to environmental issues or questions her international achievements in negotiations on the mid-term review of the common agricultural policy and with the Doha agreement, which for the first time put environmental and non-trade issues on the agenda. I do not pretend that that solved the problem because reaching agreement in a body such as the World Trade Organisation is difficult, but at least those issues are now on the agenda, when they were not in the past. There is not much evidence either of any attempt to get them on the agenda in the past. My right hon. Friend can take credit for that development.
    I do not doubt either the commitment to the environment of my right hon. Friend the Prime Minister, which he has demonstrated on many occasions. In his speech to the American Congress, he raised the issue of climate change right to the heart of American government. We have repeatedly said that, as America is the greatest contributor to greenhouse gases, it must take climate control seriously. Even though the Americans have not signed up to Kyoto, many American states, institutions and academics do take climate control seriously and have tried to address it unilaterally within the US system.
    The US Government are keen to take forward environmental technologies, which have a contribution to make. We do not believe that such technologies are the complete answer to climate change, but we are prepared to work with the Americans. We welcome the large sums of money that the US has committed to environmental technology research and to research and development generally. We have agreed to co-operate with the Americans in the G8 in taking forward environmental technology. The House should not be misled into thinking that there is no US engagement or involvement on climate change. However, we believe that the US ought to ratify Kyoto and ultimately should be part of a global agreement on controlling greenhouse gases.
    Sue Doughty: We welcome the fact that the Government are working with the US to secure improvements, but I still have great difficulty identifying the strategic leadership. This is not an anti-American debate. We accept that a lot of good work is being done in the US, but there is a huge gap. Something is needed to tip the Americans into ratifying Kyoto. The US must be made to understand the potential for jobs and other opportunities if it provides leadership.
    Mr. Morley: That is also an internal debate within the US. I heard a lecture by a prominent scientist who advises the Bush Administration in which he made it clear that there was no doubt about the impact of climate change and the need to address it. Many voices
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    have been raised in the debate in the US and I am sure that that will continue—as is the case with Russian ratification.
    Carbon trading and setting caps are not all negatives in respect of their impact on industry. They encourage energy efficiency, improve competitiveness and offer financial advantages—not least to Russia. We are trying to make the case to Russia that there are economic advantages to ratifying the Kyoto agreement.
    Mr. Weir: I was in Russia at the end of last year and one view expressed was that climate change might benefit that country as it might increase agricultural production. That opinion is prevalent in high Government circles in Russia, which is most worrying.
    Mr. Morley: That is worrying. I have heard the argument that where a country has a frozen hinterland, increased temperatures might be no bad thing. However, when road vehicles and pipelines start sinking into the melting tundra, climate change might not be thought such a good thing. There are also all the associated problems, not least the impact on biodiversity.
    The Hadley centre and the Tindale centre are both world-class institutions and the former has developed a regional model of its climate change programme, Précis. I had the opportunity to meet academics from various institutions in India who are applying the Précis model to the Indian subcontinent in a first-class project that is supported by my Department as part of its commitment to global sustainability and national sustainable development.
    Key to our approach is putting sustainable development at the heart of our policies, as we want them to impact positively beyond political time scales. Our key objectives include the sustainable use of natural resources and protecting the rural, urban, marine and global environments. To make changes sustainable, they must be set alongside economic opportunity and social well-being. One cannot separate the three strands.
    Structures are also involved. The hon. Member for Lewes referred to the change from the Department of the Environment, Transport and the Regions to DEFRA. I acknowledge the arguments for a DETR- type structure because keeping environment, transport and planning together offers certain advantages. But keeping together the environment, all land use policy, all water policy, biodiversity policy, global and national biodiversity, and sustainability in one Department also has advantages. What is key is ensuring that Departments engage with each other. Ministers from my Department have made joint appearances before Select Committees with Ministers from other Departments. The launch of the better building regulations task force involved Secretaries of State from the Office of the Deputy Prime Minister, the Department of Trade and Industry and DEFRA. We are developing joint strategies and there is a collective approach to decision making. All those initiatives are bringing together Government functions on sustainability.
    I accept the point that the hon. Member for Lewes made about the importance of transport, but our society is becoming more affluent and people have the freedom to buy cars if they so choose. That does not mean,

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    however, that we cannot address problems through, for example, the transport plan, which was widely welcomed. The hon. Member for North-West Norfolk (Mr. Bellingham) acknowledged that an additional 1 million people are using rail. We have applied fiscal measures to transport. For example, we have changed company car taxation, which is linked to car emissions rather than engines, as was the case in the past, and have made changes to road tax, which was also linked to engine size. We have introduced a range of measures to address the impact on society of transport, including air travel. We accept that more needs to be done, and that measures on air transport need to be introduced to tackle the issue of pollution and climate change. Air transport is by its very nature a global activity, so we need international agreements and approaches, but that does not mean that we cannot make progress on an EU level, and we are looking at that.
    Gregory Barker: When the Secretary of State for Transport appeared before the Environmental Audit Committee to discuss the Government's policy on air travel, we were extremely underwhelmed by the complete lack of a clear environmental policy on airport and airline expansion. Perhaps the Minister could enlighten us, and tell us what direct influence he has had on his colleague's transport policy and the future of the airline industry?
    Mr. Morley: We are, of course, consulted on issues such as the Government White Paper, strategy on air travel and related developments. It is easy to wrestle with such problems in opposition, but the hon. Gentleman should accept that more people want to travel by air. Plane use and passenger numbers are going up. We cannot ignore that. We must recognise trends in society such as the demand for travel, but we must try to tackle their environmental impact.
    Gregory Barker: I am extremely grateful to the Minister for being so generous in giving way. However, he cannot ignore the fact that the real cost of airline travel is falling dramatically. In recent years, the cash cost of air tickets has fallen dramatically, and is set to continue to fall in real terms. The Government, however, are quite unwilling to engage in the argument and simply talk about the generality of people wanting to travel.
    Mr. Morley: That argument is under way. However, if I interpret the hon. Gentleman's comments correctly, he seems to be arguing that air travel is getting cheaper, so it should be taxed to make it more expensive. That would not necessarily deal with the issue of emissions and pollution—it may simply mean that people pay more, so there will not be an effect on the environment. We must therefore think carefully about which measures we want to apply. For example, the application of carbon trading to air travel within the EU is being considered as part of the EU debate. The proposal has a great deal of merit and would have
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    genuine results. We need collective agreement on such issues, in this case in the EU, but in other cases on a global basis.
    Mrs. Patsy Calton: May I return to the Minister's comments about people being more affluent and using their cars more? The implication was that the Government simply recognise trends and follow them, rather than trying to set them. In a recent consultation about post office closures, my constituents said that they do not have more cars or more opportunities to use them. They want to be able to walk to the local post office. Government policy on post office closures does not help the environment or reduce the amount of car traffic. Where is the Government's leadership?
    Mr. Morley: With respect, post offices and small shops are closing because the hon. Lady's constituents are driving to out-of-town department stores. Of course, we must try to influence such trends and change them, but we must not make glib statements. Many shops close down because local people, who all want to keep them, do not use them themselves. Changes in patterns of behaviour and individual responsibility are not easy to bring about, and the Government cannot dictate exactly what people should do. The hon. Lady seems to think that Liberal Democrat policy is about whether people can or cannot buy a car, where they can take it and how they can use it. I did not know that there was a Stalinist element in Liberal Democrat policy on the environment. Sadly, however, life is a bit more complicated.
    We must introduce a range of measures to convince people to follow a course of action that is beneficial for their communities and society. That may, for example, involve restrictions on access to city centres, such as parking policies and parking charges. A range of measures can be applied, but a balance must be struck. It is not, however, always easy to do.
    Mrs. Calton: I thank the Minister for being generous with his time. However, he has changed the terms of the argument. No matter how much he wags his finger at me, in my constituency, which is considered affluent, there are people who do not have access to cars, buses or other forms of public transport. Forty per cent. of the people who replied to our consultation have mobility problems, and in some areas 20 per cent. have no car. What is the position of those excluded members of society who do not have the opportunities that the Minister is talking about?
    Mr. Morley: Of course there is a social exclusion problem, which the Government take seriously. Perhaps the hon. Lady would like to have a small wager with me as to whether or not car ownership in her constituency has gone up or down since 1997. I think I know exactly what the trend has been.
    Mr. Challen: I should like to return to aviation, as it is an important area. As the last international treaty governing aviation was signed in the 1940s, does my hon. Friend agree that the European Union offers us the best way of trying to make the environmental improvements in aviation that we need? That is one reason—Opposition Members obviously will not accept it—why we should remain fully engaged with the EU.

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    Does my hon. Friend agree that environmental measures should be built into new EU rules governing our relationship with other countries such as the United States? There is a moratorium on genetically modified food, and we could build in environmental considerations that would have a moratorium effect on air travel if we did not conclude a treaty in the near future.
    Mr. Morley: I certainly agree that there is a case for negotiation and discussion to reach an international agreement, both within the EU and globally. My hon. Friend is right—insufficient attention has been paid to the growth of air travel over the past few decades. Times have changed, and we need to address the problem.
    I do not think that there is any disagreement in the House about the need to tackle climate change. Our record is strong, given that we have exceeded our Kyoto targets and are pursuing an ambitious goal, as we are committed to reducing CO2 by 60 per cent. by 2050. I am not complacent, but nevertheless we are making progress and have considerable support for our approach. I hope that by leading by example—we are the first EU country to implement the EU carbon-trading scheme and set targets—we can encourage other countries to follow.
    Norman Baker: Before the Minister leaves the subject of aviation, what steps are the Government taking to try to ensure that aviation emissions are included in Kyoto targets, as currently they are absent? What will he the impact on aviation sector emissions following the Government's recent announcements on aviation? I think that there will he a big increase.
    Mr. Morley: There will be an increase in emissions, and the hon. Gentleman is free to look at our figures. As for Kyoto, ideally, aircraft emissions should have been included from the beginning, but we must be realistic and accept how far and how fast we can go. The hon. Gentleman and his colleagues are well aware of the problems with the Kyoto agreement, including the difficulty of getting Russia to ratify and the fact that the US has walked away. The inclusion of aircraft emissions would not have made that any easier. The best way to deal with the issue, as my hon. Friend the Member for Morley and Rothwell (Mr. Challen) suggested, is to approach it internationally rather than within the Kyoto process. Perhaps we will be able to do that post-Kyoto, but in the meantime, the main thing is to get Kyoto ratified and up and running.
    I strongly believe that environmental sustainability issues should be addressed locally, nationally and globally. The local aspect includes buying from individuals, which involves raising awareness by making these arguments. We recognise that we have a role to play as a Government, as do the local authorities and non-governmental organisations with which we cooperate closely in trying to get the message across. We also need to play our role globally, as we have done on climate change. We are fortunate in this country to have a first-class scientific base with a wide range of institutions and people. We have been active and successful in international bodies such as the convention on international trade in endangered species—CITES— and the convention on biological diversity, which I will
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    attend later this year, and where we will press for further changes, including the extension of protected areas to the marine environment. We have worked with our colleagues in the EU and internationally. We have increased the budget of the Darwin scheme—which was originally set up by the Conservative Government; I give credit where it is due, because it has been extremely successful—from £2 million to £7 million a year.
    We are making progress on forestry. I am proud of the fact that we were the first G8 Government to make a commitment to procuring timber on our Government estates from legal and sustainable sources. We have set up a point of expertise to advise people about that, and we are working with the forest law enforcement and governance process in Asia, Africa and the EU. We want to agree powers in the EU that will strengthen our power to seize illegal timber. We can, and do, seize timber that is in contravention of CITES regulations, but I want to be able to go further. That must be achieved on an EU-wide basis—we cannot do it unilaterally, because we could not stop timber coming from, say, Rotterdam into this country by rail or through the tunnel. We are actively encouraging that EU-wide approach.
    I turn to GM in Wales and Scotland. If the hon. Member for Lewes has a fault, it is that he tends to believe what he reads in the newspapers without any criticism or question. He should be wary about that, because in this case it was inaccurate. We are still discussing GM with the devolved Administrations, with whom we have a friendly and constructive relationship, and we will in due course announce our response to the recommendations of ACRE—the Advisory Committee on Releases to the Environment.
    Waste is one of the areas where we have lagged behind other countries, although we have a good record on climate, water quality, air quality, and involvement in sustainability and environmental issues. I am pleased, however, that we are making a great deal of progress on waste. We are hitting our targets on recycling, and many more doorstep collections are being introduced by local authorities. Our strategy—the waste implementation programme—is having a big effect. WRAP—the Waste and Resources Action Programme—has been successful in finding markets for recyclates. I am not complacent, because we need to do more, but I am encouraged by the fact that we have made very good progress, which seems to be accelerating.
    The hon. Member for Lewes asked about the ghost ships. The bottom line is that people should have the facts about that situation, and I hope that he will join me in condemning the extreme, alarmist and inaccurate descriptions of "toxic time bombs". The fact is that those ships are no better or worse than any other scrap ships of their age. They remain under an injunction and are stored safely in Hartlepool in the facility run by Able UK. In terms of their future, if there are proper green recycling facilities in this country that are legal and have all the required permits, the best option would be to do the job in this country, not tow them all the way back across the Atlantic. That is self-evident, and most green groups regard it as the best option environmentally.
    The situation gives rise to wider issues such as our strategy for ship recycling. As many ships, particularly single-hull tankers, will come on to the market in the

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    next few years, we need good facilities in this country to avoid exporting our problems to other countries. We are in the process of developing those facilities.
    Mrs. Caroline Spelman: The Secretary of State for Environment, Food and Rural Affairs is on record as saying that the ships will be sent back. Is the best environmental solution therefore effectively a U-turn?
    Mr. Morley: No. The hon. Lady did not listen to what my right hon. Friend said. She made it clear, in the same words as I have used, that we are seeking the best environmental option. If the option of proper green recycling facilities is not available in this country, the US recognises that the ships will have to be returned. There is no change in the present situation. The hon. Lady joined the bandwagon on these ships, but it ran into a ditch when the green groups recognised that the incident had been exaggerated disgracefully. Is she saying that she does not want Able to be developed as a world-class recycling facility?
    Mrs. Spelman: Of course I would love to see a world-class facility at Able, but the dry dock has not yet been built and the ships are moored up next to Seal sands in Hartlepool. While I entirely share the Minister's desire for the best environmental solution, we both need to be clear about exactly what was said.
    Mr. Morley: Indeed. That is why I have made it clear to interested parties that there are no shortcuts in this process and that there will be no compromise on the environmental assessments that will have to be made in relation to the adjacent special protection area. We do not know whether the dry dock facilities can be put in place, the payments approved and planning permission granted; those are issues to be resolved by the company and the appropriate authorities. At the moment, it is a hypothetical situation, and we shall have to see how it develops.
    Norman Baker: The Minister seems to be keeping his options open as regards the best environmental option—as indeed he must, given that there is no planning permission, no dry dock and no licence. How does he square that pragmatic position with the extract that I quoted from the letter that his officials sent to MEPs late last year, which suggests that the decision has already been taken to dispose of the ships in
    Hartlepool—in other words, that it is a fait accompli?
    Mr. Morley: I saw that letter, and I do not give it that interpretation. It is entirely consistent with the position that I spelled out to the House, which is the position at the present time.
    Paddy Tipping: Surely it is wrong to focus on these alleged ghost ships, because the bigger issue is that increasing numbers of ships will require decommissioning. Instead of arguing about the specifics, should we not leave that to the courts and work on developing a strategy, in the UK, Europe and internationally, to tackle the problem?
    Mr. Morley: My hon. Friend is right. That work is in progress. A review of UK facilities and an assessment of
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    future demand are under way. For example, we calculate that approximately 2,000 single-hull tankers are EU-flagged and they will need to be tackled in proper facilities. Apart from not wishing ships to be exported to countries that do not have proper facilities, health and safety measures or hazardous waste handling equipment, we are considering an environmental business. I see nothing wrong with developing environmental businesses in this country, provided that they fulfil the proper standards. There is a considerable opportunity for businesses in this country in a range of environmental business, not only ship recycling.
    I welcome the debate. It is useful to tackle important and serious issues. The whole Government take environmental matters seriously. We try to lead by example in procurement and energy policies. For example, we have exceeded the targets that we set for the share of power from renewables and combined heat and power in Government estates and for the standards that we apply. We have reduced water use and increased recycling, but we want to do a great deal more. We want sustainability to be at the heart of every Government policy, whether on transport, housing or development. We hope that new developments such as Thames gateway, which will be Europe's biggest brownfield development, will set the pace for reducing energy and water use and building in sustainable transport.
    I saw an interesting development by BedZed for sustainable zero emission housing that had workshop units underneath homes so that people could work where they live. Such developments are not appropriate in all parts of the country, but they have a role to play. I am pleased by the proposal for up to 2,000 of those units in the Thames gateway. I therefore believe that Thames gateway gives us a chance to demonstrate some cutting-edge technology in sustainable design and planning.
    Mr. Francois: I thank the Minister for his courtesy in allowing me to intervene before he concludes. He mentions Thames gateway, where he well knows that there are issues about building on a flood plain. He also knows from discussions that he and I have held about the concerns in Essex about the reorganisation of flood defence committees. In a non-partisan manner, I remind him of that and stress to him that it is important to the people of Essex to be allowed to retain a flood defence committee, not least to provide reassurance about the sort of things that he has just mentioned.
    Mr. Morley: I congratulate the hon. Gentleman on getting Essex flood defence committees into a debate on the environment and Thames gateway. He knows that I acknowledge the case for local involvement. We have not taken the final decision about the structure of the new single-tier flood defence committees, but he knows that I am sympathetic to the case that Essex has made and that I invited that committee to present some proposals. I shall consider them in due course.
    Flood plain development is important and we have changed the planning policy guidance to reflect that. Indeed, we are reviewing PPG10 on development, energy and a range of sustainable issues. Thames gateway is currently defended to the level of one in 1,000, which is very high. We have long had big urban

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    centres, such as Hull, on flood plains. They can be defended; of course, that entails a cost. That brings me back to where I started: climatic change.
    When we present arguments to convince people, we admit that there are costs, through caps, to industry in carbon trading. We understand that that has an impact, but if we do not tackle global warming, there will be huge costs to society. I pay tribute to Professor King, the Government chief scientist, and Professor Dalton, DEFRA chief scientist, who have been active and outspoken. We cannot ignore the matter. If we do not tackle climate change internationally, the results for our country and the world will be catastrophic.
    2.4 pm
    Mrs. Caroline Spelman: I tend to agree that an annual debate on the state of the environment is the very least that the Government should provide. I pressed for at least an annual debate on trade justice when I was working on international development.
    There are few tests more exacting than the legacy that we leave future generations and the quality of life that we bequeath our children. When I was a child, the major threat to world security was the prospect of a third world war—a nuclear one at that. Today's children grow up facing not only the threat of international terrorism but the genuine prospect of environmental catastrophe. Although international terrorism is unpredictable, we can predict what will happen if we continue to ignore environmental problems. Furthermore, as part of a league of rich nations, if we have the will, we have the power to do something about it.
    The Minister referred to the importance of the Doha round and getting the environment on to the agenda. However, an agenda is useless unless there is a meeting at which to discuss it. As we all know, the round collapsed fatally at the talks in Cancun and it has been difficult to get any agenda back on the table. There is therefore no room for complacency among nations that are as well developed as ours.
    We need to be clear about what we mean by the environment. The term literally covers a multitude of sins. The fact that the debate is on the state of the environment underlines the breadth of the subject. For some, "environment" evokes concerns about global warming, ozone depletion or renewable energy. For others, it suggests anxieties about the amount of litter locally, river pollution or fly-tipping. It is important to appreciate the divergence in people's understanding of the environment and to make strenuous efforts to tackle each concern. Whether people's environmental concerns are focused locally or globally, there is general recognition that our lifestyle has an effect on the quality of our environment.
    There is a vast difference between the outward concerns that people may express publicly and the action—or lack of it—that they take personally. My children are a case in point. They are always quick to point out to me when in the supermarket that we should not buy aerosol cans, but they are the worst offenders for leaving the lights on once we get home. However, the fact that more and more people want to be seen to be
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    green is encouraging. Environmental concerns often resemble those about car safety in the way in which they have infiltrated the public consciousness.
    Fifteen years ago, accident safety was not such a high priority for car buyers, as shown by the fact that so few car manufacturers focused on safety as a means of marketing. However, today, vehicle safety is a strong influence on consumer choice. The same pattern is emerging with the environment. The material satisfaction that many have experienced since the 1980s has brought in its wake a new set of anxieties and priorities. Parents who are in the fortunate position of being able to provide fully for their children's immediate needs start to consider the longer-term needs of their children's children. The environment is at the heart of that.
    The cultural change is not uniform. We need to recognise and tackle the fact that environmental concerns do not figure especially highly in the priorities of people who live in deprived areas. My constituency has four of the most deprived wards in England and Wales, where daily worries about housing, drug abuse and crime render issues such as landfill and climate change almost irrelevant. I say that because it is important that we recognise that although cultural change may be in train throughout what is crudely termed middle England, there remains a vast tract of society for whom the environment is an expensive luxury.
    Improving local environments through reduced litter, fly-tipping and graffiti is a vital component in fostering a sense of pride and responsibility in areas where people live. If we do not tackle the quality of life in deprived urban environments, I fear that we shall miss art opportunity to help facilitate the sort of social improvements that we all want. The Conservative party has a proud history on the environment. I should like to correct the false impression that Lady Thatcher somehow thought of the environment as a humdrum issue. As a scientist, she was one of the first party leaders to bring the environment on to the mainstream political agenda, when she said:
    "We do not have a freehold on the earth, only a full repairing lease."
    Mr. Martyn Jones: Does the hon. Lady not remember that Margaret Thatcher stopped the very important Salter's duck renewable energy project? That project is now nowhere to be seen, but at the time it was at a production level of 10 per cent., and cheaper than nuclear energy. That was one reason why she closed it.
    Mrs. Spelman: Perhaps the hon. Gentleman will just wait a little to hear me talk about renewable energy. Technologies have moved on a great deal, even since I wrote my PhD on the subject 20 years ago. Improvements in technology have improved the economic viability of so many renewable technologies, but that was perhaps not the case at the time when Lady Thatcher was leading my party.
    Many would seek to demonise centre-right politics, capitalism and business as the arch-enemies of environmental welfare. That simplistic analysis is as flawed as the assertion that because the Conservative

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    party is pro-business, it cannot be pro-environment. However, centre-right politics yielded the end of the cold war and with it, the beginning of the end of some of the world's most environmentally destructive industrial practices. The word conservatism is a derivation of the verb to conserve, meaning to protect or preserve. Conservatism is all about taking responsibility for one's actions, being prudent, safeguarding the future and nurturing a framework of codes and practices that permit the maximum possible freedoms for everyone.
    Those four tenets go to the very heart of the protection of our environment, reflected at every level at which my party operates. At global level, as my hon. Friend the Member for North Wiltshire (Mr. Gray) has said, it was the present leader of my party, my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard), who led the negotiations for Britain at the 1992 Rio Earth summit, which gave rise to the Kyoto protocol, of which we remain fully supportive. At European level, the Conservative group negotiated to chair the environment committee in preference to other committees, because we recognised the importance of working with our neighbours to combat environmental threats. At national level, hon. Members on both sides will recognise the role played by my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who continues to be dedicated to environmental matters and who led for the Conservatives in the debate on climate change in Westminster Hall two weeks ago.
    Hon. Members will observe that, to show our ongoing commitment to the environment and our understanding that it involves cross-cutting concerns, we have again combined transport and the environment in one portfolio, which we are certainly finding beneficial for policy development. At local level, according to the National Audit Office, Conservative councils consistently perform better on environmental issues than their Labour and Liberal Democrat counterparts.
    There is broad consensus among all parties on the need to protect the environment. However, although we can agree on that aim, there are bound to be differences in the way in which we would go about attaining it. It is important, especially in a debate such as this, to give credit where it is due, and many of the Government's intentions on the environment are very good. That is why my party can make common cause with the Government on so many environmental objectives, but where we differ is on how those objectives can best be realised. Too often, the underlying problem has been misdiagnosed, and consequently the wrong priorities are chosen in the attempt to devise an effective solution. There has therefore been a system failure in implementation, creating a whole generation of new problems as a consequence.
    It is not difficult to understand how that has occurred. The Department for Environment, Food and Rural Affairs has evolved comparatively recently, and it has become rather centralised and bureaucratic, having difficulties with its lines of responsibility. I do not make that diagnosis of the problem; it was made by the person whom the Government appointed to undertake an
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    analysis of DEFRA's structural problems: Lord Haskins. He described the Department as
    "a dog's dinner of the highest order".
    Nowhere are the Department's failings clearer than in the context of the environment, and the rural environment in particular. Although we would think that the environment would come first in the list of departmental responsibilities because it is first in the Department's title, all too often—partly through events, including the demands of the crisis in agriculture—it has come last in the Government's departmental priorities. We have only recently discovered, now that the figures have come to light, that it took £500,000 of taxpayers' money to rebrand DEFRA when it was established in 2001, absorbing the Ministry of Agriculture, Fisheries and Food. Such is the confusion in DEFRA that when I recently asked a written question, the Minister who replied was unable to supply even the most rudimentary information on staffing levels in the Department. Only during oral questions in the Chamber last week did I finally obtain that information, which should have been readily available.
    The practical effect of the organisational problems in DEFRA is manifest to those who have to use its service and those of us who observe it in action. I shall quote Lord Haskins again. He said:
    "Too many organisations are involved in rural delivery, resulting in confusion—the delivery of sustainable land management, for example. is handled by at least six national agencies working with multiple regional and local organisations."
    The problems are not only of an organisational nature, but concern broader questions of competency. According to DEFRA's municipal waste management survey, England recycles or composts just 13.5 per cent. of its municipal waste. That is one of the lowest rates in Europe and compares with a recycling rate for municipal solid waste of 48 per cent. in Germany and roughly the same rate in Austria. I am yet to understand why DEFRA cannot do more to include home composting in the compilation of its figures. I strongly suspect that a failure to include in the figures the extent to which we, as a nation, compost at home has led to an underestimation of the extent to which we compost in general. If the reduction in the number of black sacks that my family puts out is any indication of the role and value of home composting, there are great savings to be made in that area.
    I have been made aware today, by industry sources, of the industry's estimate of the ground that needs to be made up. In its view, we are so massively off target over meeting the requirements of the landfill directive that unless there is a fourfold increase in the amount of composting that we undertake as a nation, we will fall way short of the directive targets by 2010. In response, the Government have set a target for the recycling rate for household waste to rise to 25 per cent. by 2005, to 30 per cent. by 2010 and to 33 per cent. by 2015. However, the Environmental Audit Committee believes that the UK will
    "not come close to meeting any of the national targets set for recycling",
    and that the 2010 and 2015 targets will be missed by "a wide margin".
    Paddy Tipping: I agree entirely with the hon. Lady's points on home composting and the need to compost.

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    However, will she cast her mind back a few months to the passage of the Waste and Emissions Trading Bill? Her Front-Bench colleague in the other place tabled amendments that would, if accepted, have led to the demise of composting.
    Mrs. Spelman: It would take an awful lot, in such a nation of gardeners, to lead to the real demise of composting. Fundamentally, we are a nation not, perhaps, of shopkeepers but very definitely of gardeners, and I think that we all understand the value of composting. If our spokesman in another place is unaware of its benefits, perhaps it is for lack of a garden—who knows? I shall speak to him on the subject.
    Mr. Morley: On the figures for recycling and composting, the hon. Lady will be aware that I have said that we have a lot to do in that area. I am not complacent about that. The Environmental Audit Committee report said that the Government would not meet any of their targets, but that is just not true. We are meeting our targets, and the rate is accelerating. Will the hon. Lady also, in a spirit of fairness, acknowledge that in relation to recycling and composting, we are starting from the very low base that we inherited in 1997?
    Mrs. Spelman: I do not deny that, as a nation, we have a lot of catching up to do, as anyone who is aware of the cultural and lifestyle differences among certain comparable developed economies, particularly on the continent of Europe, in relation to recycling and segregating household waste before it is passed to the municipal authorities will know. However, I am concerned that we sometimes sign up to directives without having put in place the necessary facilities to implement them, so that even if we want, with the best will in the world, to embrace the changes involved, we are unable to do so. A good illustration of that is the batteries directive, which we have signed up to despite there being no facilities in this country for recycling batteries. In comparable developed economies, it is regarded as a heinous crime to put batteries in the waste paper bin. However, that directive remains the only solution to that problem in this country, and I look forward to the necessary facilities being put in place so that when a safe and environmentally suitable solution exists, we really can take advantage of it.
    Recycling rates and landfill rates are two sides of the same coin. It is no surprise, given the slow progress being made on increasing recycling, that aspirations towards the reduction of the amount of biodegradable municipal waste going to landfill are also faltering. The hon. Member for Lewes (Norman Baker) made a fair point when he said that the hierarchy of dealing with waste seemed to have been turned on its head. Much more effort needs to be put into this area, because the more that can be segregated and recycled at household level, the less will be the temptation to justify the easy solution of burying it all in the ground, which we want to move away from.
    The amount of landfill increased to 22.3 million tonnes in the last year for which there are figures. That is not only an indictment of this country's inability to get on top of waste disposal as an issue—it also means that Britain is perilously close to missing the requirements of
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    the European landfill directive, which would result in a fine of up to £180 million a year. Perhaps the Government will tell us whether they intend to pass that fine on to local authorities and, ultimately, to council tax payers, should we be faced with such a bill.
    Another target that is looking increasingly fallible is that of attaining 10 per cent. of electricity production derived from renewable energy sources. The reality is that the 3 per cent. target for 2002 was missed by a considerable margin. That makes the likelihood of fulfilling the 10 per cent. target in a mere six years look more and more like a costly pipedream. I am of course aware of the recent announcements regarding wind farm investments, which the Government have been keen to cite as examples of progress in meeting those targets. However, there are many concerns about wind farms—particularly onshore wind farms—with regard to their reliability, their efficiency and, ironically, their environmental impact. Wind farms can at best be only part of any sensible programme for generating electricity from renewable energy sources. The Government must certainly look to offshore wind farms and wave farms as ways of harnessing renewable forms of energy in a more environmentally acceptable way.
    Among the most interesting and logical sources of renewable energy are biofuels. As the author of a book entitled "Non-Food Uses of Agricultural Raw Materials", perhaps I ought to state a private interest in this particular issue. Biofuels, like wind power, are not in themselves the holy grail of environmentally friendly energy production, but they could well offer part of the solution and they certainly warrant further research.
    Sadly, biofuels are another area in which the Government's thinking has appeared muddled and little or no effective progress has been made. In October last year, the Environment, Food and Rural Affairs Committee published a report which confirmed that. It stated:
    "We deplore the fact that the Government has not nominated any one Department to lead on biofuels and consider that this is the prime reason for the slow progress that has been made in this area."
    The report concluded:
    "The Government's biofuels policy still appears to be muddled and unfocussed: it has expressed support for biofuels but the mechanisms used to promote their use have had little effect so far".
    It is bad enough that the Government are found wanting when it comes to taking effective action for our medium-term renewable energy commitments, but there are also a number of very worrying failures with regard to their present day implementation of EU environmental measures. Every so often, a snapshot image of the kind used in newspapers and on television screens becomes imprinted on the public consciousness, and I would argue that one such image is that of mountains of decaying fridges piled up throughout the country with no adequate means of disposal for them.
    Mr. Challen: The hon. Lady has not really talked about nuclear energy. What are her party's policies on that issue? Its history, when in government, was to support nuclear energy with what I call a nuclear tax of 10 per cent.—otherwise known as the non-fossil fuel levy. That gave our competitors in Germany and Denmark a great opportunity to advance on us in terms of the engineering and technology required to develop wind power, for example. Would the Conservatives go

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    back to such an approach, which would set back our renewable energy prospects? Do they have a policy on nuclear power yet?
    Mrs. Spelman: The hon. Gentleman would expect the environmental spokesman for the Conservative party to state the blindingly obvious on this issue, which is that until an adequate environmental solution is found to the problems of waste from nuclear energy, nuclear power is not an option that can enthusiastically be embraced. So far, such a solution has not been found. I think that that answers the hon. Gentleman's question.
    To return to the mountains of fridges, the arguments over whose fault that was—the Government's, for failing to read and understand the implications of the ozone-depleting substances directive, or the European Commission's for not making the implications explicit—have been rehearsed many times. In June 2002, the Commons Environment Sub-Committee concluded that DEFRA and not the European Commission was primarily to blame for the situation. The Committee, of whom eight members out of 10 are Labour MPs, said that clearing up the problem would cost taxpayers £40 million. In particular, the report said:
    "While the European Commission must accept some blame for lack of clarity, the overwhelming responsibility for mishandling the implementation lies with the Government."
    The report concluded:
    "We find it deeply disturbing that the Government signed up to the regulation whilst still suffering 'knowledge gaps' about its full impact."
    What this episode serves to highlight is a routine deficiency in the implementation of European environmental legislation, and the spectre of the fridge mountain fiasco looms large as we begin implementing the hazardous waste directive and the waste electrical and electronic equipment directive. I very much fear that, as a country, we are inadequately prepared to deal with the de-manufacturing and recycling of our waste electrical goods, particularly as we feel the effects of the ominous trend towards built-in obsolescence in manufactured goods.
    One consequence of this lack of preparation is the increased problem of fly-tipping, which blights urban and rural areas throughout the country. That problem is likely to be exacerbated with the closure of 290 of the 300 landfill sites that currently take hazardous waste, just months before the hazardous waste directive takes effect. Perhaps the Minister will clarify the position on that.
    Mr. Morley: Yes, I will. The sites will not be closing. The directive ends co-disposal, but they will continue as landfill sites. Some of them, if they so choose, will be able to continue by installing a separate cell for hazardous waste on the site; indeed, a number have already put in a planning application to do so. The vast majority of the sites do not take hazardous waste anyway, so the hon. Lady's figures are really quite misleading.
    Mrs. Spelman: I tabled a written question on this subject. It is of the utmost importance to know the
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    pattern of sites to which hazardous waste will be able to be sent. Given the combination of the increase in landfill use and the costs involved, if there are to be restrictions on the type of material that can go to such sites, those who try to avoid those costs will be tempted to deposit certain materials in the countryside.
    Fly-tipping presents similar problems to those of litter, graffiti and, to some extent, urban water course pollution, which are also symptoms of ineffective law enforcement. Litter costs local authorities in the region of £342 million each year. I am not convinced that measures contained in the Anti-social Behaviour Act 2003 will reverse the fall in the number of prosecutions and convictions for depositing litter and the fall in the number of fixed penalties issued to offenders. More policing will be a far greater agent for change than more legislation.
    Another grave concern among Conservative Members is the inconsistency within the Department. Last Friday, I went to Stansted to meet campaigners opposed to the construction of a new runway. They, like me, are bewildered at the lack of an environmental impact assessment before the Government announced their plans about where to expand. This view is shared by the Environmental Audit Committee, which stated:
    "The opaqueness of the appraisal process means that it is not possible to evaluate … the cumulative impacts at both regional and national levels, and the relative balance of economic, social and environmental benefits and disbenefits."
    The Committee added:
    "We regard the absence of concise, transparent and strategic integrated appraisals as a major weakness in the consultation documents. The Department's failure in this respect conflicts with its own guidance."
    The aviation White Paper also brought to light another inconsistency in the Government's approach, to which other Members have alluded in interventions. The ambitious carbon reduction targets that the Government have set will be impossible to meet given the growth in aviation facilitated by the Government's airport expansion plans. Those failings clearly suggest that the environmental implications of airport expansion were of little or less concern when the Government reached their decision.
    At each level of environmental awareness that I identified at the outset—global, European, national and local—there are clear failings by DEFRA. It would be disingenuous of me to suggest that Britain was alone in being without a joined-up approach to dealing with the environment. I am sure that we can all name one country whose failure to ratify Kyoto should be a cause of grave concern to us all, which the Prime Minister would do well to use his much-vaunted transatlantic influence to remedy.
    The point. however, is that there is no good reason why we should not be one of the pioneers of environmental policy and good practice. It is an uncomfortable reality that without many of the EU-originated regulations, Britain would not even now be adopting environmental good practice in many crucial respects. Britain is a bold, entrepreneurial, creative country with a natural instinct for conservation and protection, and it is the Government's duty to harness that instinct. Britain could and should become a beacon of environmental progress among industrialised

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    nations. If we fail in this, we will certainly be in no position to try to influence the environmental practices of the developing countries that otherwise will surely follow in our footsteps.
    2.33 pm
    Mr. Colin Challen: I very much welcome this debate. Given the importance that the Liberal Democrats attach to it in their motion, I am surprised that it is only a half-day debate. It seems that the ice caps could melt before we move off the subject of a local income tax, but that is their order of priorities.
    The motion calls for an annual debate on this subject, and we should give it a regular slot. Perhaps it could be tied to regular debates on reports from the Environmental Audit Committee, on which I sit. The EAC, as Members on both sides of the House will know, has produced some highly critical reports, to which reference has often been made this afternoon. Its reports deserve a wider audience. The Committee was one of the key creations on the parliamentary environmental scene that arose from the Labour party's 1997 manifesto, and it has firmly established itself as an authoritative voice on the environment and sustainable development.
    My main concern with the nature of the political debate on the environment and sustainable development is that it does not engage the public as widely as it should. We know that politicians of all persuasions are reluctant to go too far down the road of radical change because a swift and debilitating electoral consequence would follow. Sustainable development, if we take it seriously, implies that those living in the most developed countries will have to make some sacrifices. Our pattern of consumption is clearly unsustainable, but it is our solemn duty as politicians—in all parties, I hasten to add—to tell voters at election time that we will make their quality of life better, which is always understood to mean their material quality of life. Our whole economic model is based on the presumption that we must pursue economic growth, and that we must emulate countries such as the United States, which has experienced the longest sustained growth rates in the western world. The fact that the US does that by consuming more resources per capita, at a rate that simply could not be replicated around the globe, is the kind of argument that is compartmentalised in discrete packets of worthy thinking labelled "the environment", "climate change" or whatever, which are not allowed as yet to challenge the assumptions of economic growth.
    How do we square the circle? It will be very difficult. The first party that dares seriously to challenge those assumptions will be laughed out of court. Unless a major disaster forces our hand, we will inevitably have to take an incremental approach, which runs the risk of not doing enough fast enough to make much difference. I applaud this Government's early and urgent efforts to get the world to agree on the Kyoto protocol, but it is still not yet in force, and, even when it does come into force, it is such a modest measure that some doubt that it will have the desired impact.
    Nations will therefore have to take more unilateral action to get things done, but even that will cause howls of protest from those such as the CBI, which would prefer simply that the climate change levy would go
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    away, because it says that it damages our competitiveness. That is the same argument used by George Bush, who wants a purely voluntary approach to climate change, which I am not sure he really believes exists anyway. He wants to prevent the American economy from suffering. He has already caused enough unemployment; he does not want any more.
    Such short-term attitudes will ultimately be self-defeating, as the costs of climate change mount. Those costs will hit us with higher insurance premiums, more flooding in some areas, more drought in others, food and water shortages and high levels of human migration causing civil strife. The Government have made some very useful steps in the right direction: the climate change levy, the renewables obligation, and the Energy Bill, which clearly has set some stiff targets in sourcing energy from renewable sources—10 per cent. in only six years' time and 15 per cent. by 2015. Some people say that we do not have the engineering capacity to meet those targets. I hope that we address that criticism by putting more resources into our energy strategy from Government funds, and that we seriously increase our research and development resource in other areas, apart from wind, which is now a fully fledged technology. How is it that we spend less on R and D in wave and tidal energy or other renewables than we use to prop up British Energy and its outdated nuclear technology?

    Most of what the Government have done so far has addressed major players in the environmental field. They have addressed corporations' use of energy, for example, and they have introduced market mechanisms, which take a while to filter through, such as the renewables obligation. What we lack is a way of engaging the public in this debate, such as mechanisms that encourage individuals to make pro-environment choices in their lives. That is the real test, because, unlike businesses, individuals have votes, and if, for example, we told individuals that they could not drive their cars our popularity would evaporate faster than a cloud of carbon dioxide. Nor, as we have seen, can we easily introduce more taxes, since the fuel protests put paid to that. No doubt it is the memory of those events that makes the Government reluctant to tax aviation fuel. What, I wonder, is the Liberal Democrat policy on that? I do not think we have had an answer to that important question.
    Norman Baker: I am sure the hon. Gentleman will be given a very full answer by our shadow Chancellor when he winds up. but in the meantime let me repeat what I said to the hon. Member for Sherwood (Paddy Tipping): aviation is currently untaxed, and we need to find ways of dealing with that. The Government have imposed airport passenger duty, which is very low and not terribly focused. There is talk of the Chancellor's doubling it, but I am not sure whether that is the right idea. We would like aviation fuel to be taxed, but we realise that that must happen, if not internationally, at least on a Europe-wide basis, which is not immediately achievable.
    The Government's aviation paper mentioned a number of economic instruments, some of which should be investigated carefully. There may, for instance, be a case for taxing aeroplanes—on the assumption that they

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    are full—because that would give airlines an incentive to fill seats rather than running half-empty flights. There are a number of possibilities—
    Mr. Deputy Speaker (Sir Michael Lord): Order. I think the hon. Gentleman has said enough for the time being.
    Mr. Challen: I was still waiting for the answer, actually. I was not sure where it was in all that. Perhaps we shall hear it at the end of the debate.
    I am happy to say, as I said to the Secretary of State for Transport in the Environmental Audit Committee, that I favour a tax on aviation fuel. The £8 billion or £9 billion that is spent on subsidising the airline industry could be better spent on other things.
    I have been talking about the individual. I suppose the individual elector might want to punish me for talking so explicitly about what has been described in a local paper as the right to cheap holidays, but I think there are ways in which we can help that individual elector to contribute to a reduction in environmental damage. In that context, I shall now shamelessly promote a meeting that I am hosting in Room 21 at 6 pm, entitled "The carbon consumer". Positive ideas will be presented, some of which originate from the Tyndall Centre, which has already been mentioned. It is a well-respected organisation that has been considering ways of cutting our carbon emissions.
    One suggestion is the introduction of domestic tradeable quotas. I have a lot to learn about the subject, but I understand that they would operate rather as international emissions trading schemes do, while in this case applying domestically to individuals. That idea builds on something mentioned yesterday by the Bishop of Leicester in his maiden speech. He referred to contraction and convergence, first proposed by Aubrey Meyer of the Global Commons Institute. The idea of contraction is to reduce the amount of carbon emissions overall, while convergence is seen as a way of distributing responsibility for the reduction. Those are exciting ideas, and I hope that the Minister will meet me soon to discuss them, as they seem to me to constitute one of the few ways in which individual citizens can become involved in reducing emissions.
    At tonight's meeting, I will also promote a scheme called "save as you travel". If it were adopted, people would be given reward cards—a concept that is familiar to the British consumer. They would be rewarded for using public transport more, by means of points, air miles or financial remuneration. The Treasury could support the scheme quite generously if it chose, by taxing aviation fuel.
    I want to mention a third proposal that deals with the environment more generally. It is not an original idea, but one that I picked up during a visit to Ontario. There, an environmental bill of rights enables individuals to launch cases or complaints against any Government, corporation or other body, which can then be investigated and pursued vigorously with a remedy possible at the end.
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    Those are three policies that I think could deal with the problems of which we have heard today. I hope that the Minister will respond positively and seek more information about them, and that we can meet to discuss them.
    2.44 pm
    Mr. Andrew Stunell: Many Departments have a role to play in the delivery of sustainable development when it comes to energy policy and environmental policy generally. I agree with my hon. Friend the Member for Lewes (Norman Baker). We have a Department for Environment, Food and Rural Affairs, and I know that the Minister wants to give a good account of what it and the Government have done, but I am constantly perplexed at the way in which the Government's responsibilities for delivering sustainability and environmental policy are split between so many different Departments. The Department of Trade and Industry, for instance, is responsible for supervising policy on electricity generation and the generation industry as a whole, while the Minister's Department is responsible for conservation and efficient energy use. The Treasury deals with fiscal regulation and such matters as the climate change levy, and our built environment is regulated largely by legislation from the Office of the Deputy Prime Minister. As the hon. Member for Morley and Rothwell (Mr. Challen) pointed out, a significant proportion of our energy consumption takes place in the transport sector, and is dealt with by the Department for Transport.
    As one who does his best to make connections between the various parts of Government policy and to evaluate them—as well as the views of many outside organisations that seek to engage with the whole Kyoto policy process—I feel that that diversity of responsibility, which is a polite way of putting it, often prevents the Government from delivering as effectively as the Minister would no doubt wish. If we are to have a sustainable environment in the future—plenty has been said about the need for that, and what should be done to achieve it—conserving resources and using them efficiently will be just as important as anything we do to generate energy. Conservation and efficiency constitute a more cost-effective way of improving our environment than any substitution of technologies for the generation and use of energy.
    I was a member of a deputation attending an environmental conference in Berlin last week to discuss sustainability and the development of policy in both Germany and the United Kingdom. The conference was addressed by Lord Whitty, a member of the Minister's departmental team who, obviously, spoke on behalf of the Government. As ever, he made a well-rounded speech, featuring plenty of explanation of what the Government had done and intended to do. As I listened, I felt rather like repeating a line from a John Cleese sketch—the one in which he goes into the kitchen and says "I think I got away with it that time." The words were fine and the message was good, but the audience was not in a position to apply its critical faculties in order to find out what was actually going on.

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    A German participant in the conference said later "The difference between your Minister and mine"—the German Energy Minister had also made a speech—"is the difference between a 1 MW and a 12 MW man." Of course, that underlined the fact that our performance falls well short of the words that we use. I hope that the Minister, in responding to the debate, can give some reassurance that the Government are not only talking a good talk but are prepared to walk a good walk.
    I cannot sit down without saying something about the small contribution that I am making through my private Member's Bill, the Sustainable and Secure Buildings Bill. I am happy to report that it has support from both sides of the House—from Government Front Benchers, from Conservative Members and from my own party. It tries to focus the attention of the building industry in particular on the fact that how we save energy is as important and cost-effective as how we generate it. Notwithstanding the rows that we have in this House about the applicability of renewable technologies windmills or waves, for example—compared with nuclear energy, we need to remember that for every £100 that we can invest, we will take a bigger step towards sustainability by investing it in conservation and efficiency than by investing in any of the available generating technologies. My Bill tries to pick up on that point, and to make sure that in future our building stock is more sustainable and efficient.
    The hon. Member for Morley and Rothwell said that we cannot make progress without everybody having to pay some of the price. However, if we improve the efficiency of our building stock, we will improve our comfort levels, reduce the number of people who die in the winter because their homes are too cold, reduce the bills that people have to pay and reduce the carbon dioxide emissions that contribute to climate change. I want us to spend more time focusing our political energy on those factors that can produce a win in every dimension: a financial win for the consumer, a health win for our country, and an environmental win in terms of a reduction in greenhouse gases. I thoroughly agreed with 99 per cent. of what the hon. Gentleman said, but his point about progress constituted 0.5 per cent. of what I did not agree with.
    The other 0.5 per cent. of what I did not agree with was the hon. Gentleman's proposal—assuming that I understood it properly—that we award public transport points, so that people receive a reward for travelling by bus. That is fine, but giving a reward of air miles would somewhat undermine his initial point.
    Mr. Challen: The point is that, as has been argued, putting a tax on aviation fuel would tax working-class and poorer people out of air travel. They are the people who use public transport, so if they were rewarded in the way that I am suggesting, we could balance the risk that such people would be taxed out of the air.
    Mr. Stunell: I thank the hon. Gentleman for that explanation, which puts the idea into a somewhat different context. Perhaps we could debate on a separate occasion how we might run such a card; however, we are some way from that at the moment. I certainly agree that we need to do all that we can to make people aware of the benefits to them of a healthy public transport
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    system that they actually use. Practically everybody says that they are in favour of a better public transport system—on the basis that others will use it, so that they themselves can drive their cars more rapidly. Some significant work needs to be done to change that situation, and if the hon. Gentleman's proposed card will achieve something, I am certainly prepared to consider it.
    We need a broad consensus in this House on what needs to be done in terms of the environment and sustainability. The proposal of my hon. Friend the Member for Lewes that there be an annual report, and all that is implied in bringing to the House the key strands of Government policy, are very important. We need a broad consensus because we have to keep going with this project, and not just for one or two Parliaments. For the next eight, nine or 10 Parliaments, and certainly for the next 50 years, this issue will be of fundamental importance. We need that consensus so that we can move matters forward, so that those outside this place can believe with some confidence that they are backing the horse that will come first in the race, and in particular so that we can achieve real results.
    If we decide to go for a long-term strategy—the Government have indeed set targets for where they want to be in 2050—the important thing is to ensure that the steps taken between now and 2050 are each of a size that enables them to be taken at the time, but which continue progressively year after year, so that we can reach our goal. For example, we need only a 1 per cent. increase in our renewable generating capacity each year to achieve 50 per cent. by 2050. Admittedly, it will take us another 40-odd years to get there, but that is the time scale and progress that we need to think about.
    With that in mind, I want to give credit to the Government for the recent extension of the renewables obligation, beyond 10 per cent. for 2010, to 15 per cent. for 2015. I thoroughly approve of that decision, but I do hope that they will quickly recognise that further progressive increases are needed, because that is the way to lay the foundations of certainty for investment.
    Norman Baker: Is my hon. Friend aware that in the 1980s the then Department of Energy predicted that it would be possible to obtain 40 per cent. of our energy from renewable sources by 2020? Back then, development of renewables was very limited, and such matters were the responsibility of the Atomic Energy Authority, which was not necessarily very keen on developing renewables.
    Mr. Stunell: I certainly agree with my hon. Friend's underlying point, which is that we have missed several boats over the years. However, we are where we are. We are standing on the quayside, and another boat is available. When we get on it, we must make it go as fast as we can, but the main thing is to ensure that we are on it. It is important to set course in the right direction, and to proceed with all due speed.
    I hope that, in responding to the debate, the Minister will pick up on the urgent need to ensure that all Government Departments are focused on this problem and are working together. I hope, too, that he will focus

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    on the need to achieve a broad consensus throughout the House on the need for the environment and sustainability to be at the heart of policy making. I hope that there can be broad, non-partisan, all-party encouragement to the Minister—and to subsequent Ministers—to make progress in future.
    2.58 pm
    Paddy TippingI am very pleased to follow the hon. Member for Hazel Grove (Mr. Stunell), particularly given that I am a sponsor of his private Member's Bill. It must make sense to have buildings that are more sustainable and efficient, and which will last us in the long term. I want to reinforce his argument—the hon. Member for Lewes (Norman Baker) made the same point in opening the debate—that the more we can do to achieve a shared long-term strategy, the better it will be for us all.
    I am pleased to be involved in what has been a balanced debate, although it has perhaps been out of synchronisation in certain ways. The discussion has concentrated on problems. It is easy to recognise problems, but it is sometimes hard to develop solutions. The reality is that the more we concentrate on solutions instead of problems, the better off we will be in the long term.
    The tenor of the debate has been such that we have tended not to recognise the Government's achievements, but to look instead at some of the failures. It is always easy to look at failures, but there have been achievements. The temptation with achievements is simply to pocket them and move on.
    Let me remind the House of one or two of the Government's achievements. We are committed to building 60 per cent. of all new housing on brownfield rather than greenfield sites—something for which we all campaigned. When the Government came into office, they stopped the privatisation and progressive sell-off of woodland across the country. We have taken steps to create two new national parks—the South Downs and the New Forest national parks. Significantly, after years of decline, the number of wild birds is at last beginning to increase again. It is important to me that, after 100 years of campaigning by MPs across the country, we will have legislation in force later this year enshrining the right to roam on wild, open spaces. I believe that those are all significant gains, which should not be denied.
    I want to deal with one or two problems and try to move us towards partial solutions. The hon. Member for Meriden (Mrs. Spelman) and the hon. Members for Lewes and for Hazel Grove all touched on energy policy. Let us recognise that it is almost the anniversary of the White Paper. I support its aspirations and believe that it is right to move towards a lower carbon economy, but I have anxieties about whether the targets correctly set out in the White Paper will be met. It has already been mentioned that, at the current 3 per cent. figure, we have a long way to go before reaching the 10 per cent. target by 2010, particularly when we have acknowledged that most of the 3 per cent. is traditional hydro energy and that the current rate of acceleration towards renewables is pretty slow.
    We should also recognise, as stated in the White Paper, that wind power is the best method of getting us from 3 per cent. to 10 per cent. and then up to 20 per
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    cent. The language of the White Paper is interesting: it is an aspiration that some people might say is impossible to achieve, but we should strive towards that wind power goal.
    I believe that there are some problems with on-land wind power. The Minister will remind me that two-thirds of planning applications for new wind farms are either withdrawn or rejected. The great hope—my hon. Friend the Minister for Energy, E-Commerce and Postal Services has campaigned hard for it—is to secure offshore fields. Some important points need to be made about that. Wind power will, by definition, be peripheral and there is a sense in which we need to rewire Britain. We are moving from an energy policy that was dependent on coal and steel to one in which power generation will be more embedded. In those circumstances, that rewiring of Britain will have costs, as will the renewables obligation.
    I am anxious about the lack of recognition in the White Paper that energy will cost us more in the future than at present. For the past decade, we have seen low energy prices in relative terms. The White Paper speculates that those prices will, over the next few years, rise by 5 to 15 per cent. I think that it will rise even more and I am very concerned that the social, political and economic consequences have not yet been properly thought through. If energy prices are going to rise more dramatically than predicted in the White Paper, we must reflect carefully on the consequences, particularly for the more disadvantaged members of the community.
    I accept the point of the hon. Member for Hazel Grove that we should pursue energy conservation more vigorously. I must confess that, although I am interested in energy policy, I do not understand the whole range of energy conservation measures that are available. I believe that the time has come for us to examine them and review them radically. We need to increase funding, but it is important that we measure outputs and deliver resources to new energy efficiency and conservation programmes according to the amount of carbon that could be saved.
    We have acknowledged in the debate that, although carbon emissions are falling, it has been mainly on the back of the coal industry. I believe that the Government are relatively weak on having a coherent policy towards the transport sector. There are few remedies around to tackle the problem. We have an example of congestion charging in London, but it could be the case that, in the short term, the only show in town is to move towards biofuels, by which I mean biodiesel and bioethanol. I am concerned that, although the present duty rates set by the Treasury have been reduced by 20p, that will not be sufficient to encourage the UK biofuel industry.
    I believe that biofuels can help us to deliver two policy objectives: to reduce the amount of emissions; and to provide a real lever to help British farmers to bring new investment, and new and different ways of working, into the British rural economy. I am truly concerned about the current Treasury approach of generally accepting in the pre-Budget report that biofuels have a place in our energy policy, because there is a danger of sucking in biofuels from abroad, particularly from Brazil, and failing to encourage our own biofuel industry. I hope that the Minister will pass on my pre-Budget representations to his colleagues in the Treasury. It is

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    important for the Department for Environment, Food and Rural Affairs to talk across Government. My main pre-Budget representation is the need for us to be adventurous and imaginative about how we approach biofuels policy.
    I am not convinced that a further cut in duty rates is necessarily the right way forward. British Sugar, for example, wants to use its factories to create bioethanol. One means of help could be through capital allowances. Another way of helping the whole industry would be to consider having a biofuels escalator. That would allow us to build on the EU biofuel regulations—stipulating 2 per cent. by 2005, though I worry whether we can achieve that—and set ourselves a longer-term goal. By regulation we could encourage an increasing biofuels mix—starting at 1 per cent. and perhaps increasing to 10 per cent. over a 10-year period. That would provide British producers and British farmers with the opportunity to put down roots and develop their business rather than sucking in from abroad. As I said, that is a real danger because biofuels are taking off not only in Europe, but across the world. We need the opportunity to develop our own industry.
    Norman Baker: I agree with the hon. Gentleman that the Treasury could provide some long-term stability so that people had some knowledge of how matters would stand in five or 10 years' time. One current problem is the uncertainty about whether the Treasury is going to chop and change its view on what is desirable.
    Paddy Tipping: That is exactly the point. We need to set long-term goals with appropriate fiscal mechanisms so that producers can operate in a market that they understand.
    The energy White Paper will have consequences for carbon emissions, as will biofuels. I accept that global warming is taking place, although one can argue about its scale. I want DEFRA to work across Government, and internationally, to compile a report on the consequences of global warming for people in the UK. It is clear that summers here will be drier and winters wetter, and that there will be real consequences for sewers. Storm sewers will overflow as a result of flash floods, and real damage will be caused.
    This debate is about the state of the environment. This morning, I was talking to the Minister about private sewers. Most hon. Members will be aware of that issue as a result of their constituency work. We are making important progress, but we must keep one foot on the pedal. I look forward to the Government announcing the future direction of policy in the spring. We should look at how private sewers could be adopted, and at how to fund the work that needs to be done on them.
    We also need to look at water. It is a scarce resource, and global warming will cause problems with its provision. I hope that the Government will consider that problem, and devote to it part of a larger report on the consequences of global warming. Flooding is a big issue, and we need to have a discussion about managed coastal retreat.
    Important though these issues are, they must not be taken in isolation. If we can deal with issues of the countryside and landscape in a more careful and thoughtful way, we may be able to find some solutions.
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    The Government have achieved an enormous success with the mid-term review of the common agricultural policy. Only 12 months ago, people said in this Chamber that it would never happen, but the biggest change ever in the CAP has been secured. We should not throw that achievement away lightly.
    Shortly, the Government will announce how subsidy support to farmers will be paid in 2005. I hope that we will break with the past on that, in the same way that we have changed the CAP. I know that the Minister and his colleagues will listen to claims for historical payments, but I hope that they will recognise that a hybrid approach based on area payments will have better consequences for the environment. There may be difficulties in terms of management, but I advise my hon. Friend the Minister, firmly, that we should not throw away the gains that CAP reform offers.
    The reform of the CAP would allow us, in the longer term, to pay landowners to let their land be flooded Lots of other possibilities would open up as well, especially when it comes to protecting the environment. Diffuse pollution is a real problem. Farmers will not want me to me say so, but the farming communities are the biggest polluters at present. We must link CAP reform—which deals with how farmers are paid—with how we inspect and regulate the farm sector. It might be possible to adopt a single, whole-farm approach, and in that way bring about changes in behaviour.
    In my speech, I have considered various problems and suggested partial solutions. As other hon. Members have noted, to achieve big gains in the environment we must work from the local level to the national level, and from there to the international level. We must recognise that the changes will not happen overnight: these are long-term issues, requiring policies that are sustainable in their own right. As far as possible, policies need the all-party support that will mean that they can be delivered, not in one Parliament but over several decades. As many speakers noted, it will become increasingly vital to take seriously environmental concerns—such as enhancing the environment and improving the landscape—and make them the cornerstone of Government policy in the future.
    3.16 pm
    Mr. John Randall: In my capacity as an Opposition Whip, I confess that I was slightly disappointed with the Liberal Democrat motion for this debate, as I could find nothing in it to disagree with.
    The hon. Member for Lewes (Norman Baker) made a thoughtful introduction. Not long ago, the Minister was present for a very interesting debate in Westminster Hall on climate change. I shall not recycle the speech that I made then, even though the same people tend to take part in these discussions and there is a great temptation to use renewable sources of information.
    There is a danger that some hon. Members will be seen to be banging on about this subject continuously, but it is so important that there is sometimes no other way to deal with it. My own interest is biodiversity. Many people wonder whether that is really so important, given all the other things that are going on, but I advise them to think of the miner's canary: if animal species are—almost literally—dropping off their perches, should we not worry about what might happen to us?

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    There has been an interesting discussion about forests this afternoon. I spent most of my life before I entered the House selling furniture, so I am acutely aware of timber, and of the great joy that wood products give many people. However, I also know how difficult it is for our manufacturers to find timber that comes from sustainable sources. Nearly all British manufacturers want that, but my experience was that they did not always get it, despite the assurances that they were given. The suspicion was that some of the money put aside for replanting in fact ended up in a Swiss bank account.
    As many hon. Members know, I have a special interest in the marine environment. I urge the Government again to see what can be done about implementing legislation that will give the marine environment real protection. I have gone through the agonies and ecstasies that a private Member's Bill involves. In my case, the ecstasy came first: the agony followed when my Bill foundered on the rocks of the House of Lords. I am aware of how complicated marine environment legislation is. The marine environment is not like the land and the legal competences seem extremely complex; we do not have the same protection for something that is just as valuable as the terrestrial environment. I hope that the Government, my party and the Liberal Democrats will work together to try to implement such protection—I know that the Minister takes a keen interest in the matter. It is not always easy to raise a priority with a Government who have many other priorities in mind—although I may not agree with many of their priorities and certainly not with the way they carry them out—but environmental matters are important.
    I have a particular interest in genetically modified crops. During my first year as a Member, the hon. Members for Lewes and for Nottingham, South (Alan Simpson) and I took the Government to court over genetically modified seeds. I was a bit concerned that I might have to foot the bill. The action was about the process and the Government acknowledged that they might have cut a corner, so things were put right.
    The results of the Government's farm-scale evaluations of three genetically modified, herbicide-tolerant crops—spring oilseed rape, beet and maize—were published in January. Each crop had been genetically modified to allow it to withstand a particular broad-spectrum herbicide. The trials examined the effect of growing GM varieties of those crops on the abundance and diversity of wildlife, and compared those effects with what happened in conventionally grown fields of the same crop types. The results for the beet and spring oilseed rape showed significant environmental harm and I believe, with many others, that the Government should thus rule out growing them commercially.
    The maize results were better for many types of wildlife than those for conventional maize; there were more weeds and weed seeds in and around the crops and more insects at certain times of the year. However, those results cannot be attributed directly to the way in which the maize was genetically modified; rather, they were a consequence of crop management, as the broad-
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    spectrum herbicide applied to the GM maize was less effective in reducing weeds than the herbicide regime used on conventional maize.
    In many of the conventional trials, the herbicide used was atrazine—a chemical that has recently been banned in the European Union, owing to its damaging environmental profile. Given those uncertainties, I hope that the Minister will agree that it would be premature to approve commercial growing of GM maize before the Government have tested the crop's performance by comparison with conventional maize that has not been treated with atrazine. The need for caution is paramount, because the public have not yet been persuaded. If GM technology is to be used, it is vital that the public are behind it, and we are a long way from that.
    We have already heard about aviation, and tomorrow there will be a debate in Westminster Hall on the aviation White Paper during which I hope to catch the eye of the Chair, but I want to touch briefly on the subject. Those of us who live near Heathrow already know about air pollution and the effects of aviation on our environment. There is a dichotomy, however, because aviation is part of our local economy. Many Members have alluded to similar problems. We can all talk about what we want to happen, but we do not want it to impinge on our own lives.
    The hon. Member for Morley and Rothwell (Mr. Challen) said that he might get into trouble for talking about the possibility of charging higher air fares. My constituency may be a bit more marginal than his, but as I have already said in this place, we have to accept that cheap air travel is not a human right. We might want it, but not at the cost of our environment. I was interested to hear his idea for a travel card; I appreciate the point that he was making.
    There are ongoing problems at Heathrow and we need to discuss them. Most of our discussions have been with the Department for Transport, but DEFRA has an important role, too, as it will—I hope—monitor the results of air pollution around Heathrow. If the levels cannot be reduced, the third runway will not go ahead. I am not sure what existing data we can use for comparison to determine whether pollution is going down, nor am I sure how independent the results will be.
    I regret to tell the House that as I get older not only do I get grumpier, but also more cynical; I may be unwise to go down this path, but sometimes I think that results are determined by the requirements of certain Departments rather than by the facts—one can get what one wants if one asks the right questions.
    I have every sympathy for DEFRA and for some of its excellent personnel because they face problems of interdepartmental conflict. During the course of my private Member's Bill, soundings were taken by various Departments—for example, the Department of Trade and Industry and the Treasury, which of course always rears its head. I understand that, but we must take serious note of the fact that the environment is not a luxury; we must take it very seriously.
    My hon. Friend the Member for Meriden (Mrs. Spelman) wisely pointed out the danger that care and concern for the environment can be seen as "middle England"—although perhaps that reflects her constituency, as it is in the middle of England. Many people think that they have greater concerns in their

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    everyday life than worrying about which products to use and whether they are environmentally friendly and so forth. If that is true in this country, we can understand why certain other countries, with incredible problems, feel that environmental concerns are not for them. However, we cannot take such things lightly.
    Mr. Peter Ainsworth: My hon. Friend always speaks well on these subjects. Does he agree that part of the problem that has dogged environmental policy for generations is that the Treasury seems to think that the environment is part of the economy, whereas of course the reverse is true?
    Mr. Randall: My hon. Friend puts the point admirably, as befits his position as Chairman of the Select Committee on Environmental Audit. I congratulate him and the other members of the Committee on doing such an excellent job.
    I have lived in Uxbridge all my life—I still regard it as Middlesex. I can still walk out of my house and go bird-watching, but I have noticed, despite the comments of the hon. Member for Sherwood (Paddy Tipping), that the number of species is declining. It may be part of the grumpy old man syndrome, but the environment around me is changing, and not for the better. My constituents, my family and I feel the effects of environmental pollution on our health every day. We should not take that lightly.
    We all experience contradictions in our lives. Before I became a Member of this place and could speak on these matters, I used to walk to work, but now I travel to work by public transport and, yes, I drive here on many occasions because the public transport system is so bad. However, I shall try to make an effort, because of what I want for my children.
    The environment is a wide subject—it can cover everything from litter to climate change, as has been pointed out. We must take it seriously and I hope that the debate has awakened some people's thoughts on the subject.
    3.30 pm
    Dr. Vincent Cable: It is clear from the contributions that have been made that this subject does not arouse enormous ideological division and passion, and there has been an extraordinary degree of consensus. My hon. Friend the Member for Lewes (Norman Baker) was generous in his introduction and acknowledged the many things that the Government are doing with which we agree. The hon. Member for Meriden (Mrs. Spelman), the Conservative spokesman, used language such as "common cause" and "credit where it is due", and any doubts that she might have had that she was speaking off message were assuaged by the contribution from the Conservative Whips Office. The Minister reciprocated by acknowledging Government failings in areas such as waste management in an open-minded spirit. In a particularly thoughtful contribution, the hon. Member for Sherwood (Paddy Tipping) discussed the need for a balanced approach.
    People on the free market, libertarian right would regard the debate as wet and woolly, and people at the deep green end of the argument would regard all of us as hopeless consumerists, but none the less there is a fair
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    degree of agreement on the way we should head. However, this is not an Adjournment debate; it is an Opposition day debate, and perhaps I can focus on some of the areas of criticism.
    My criticisms are not of strategy, objectives or philosophy; they are criticisms of effectiveness. I shall quote the previous Minister for the Environment, the right hon. Member for Oldham, West and Royton (Mr. Meacher), who spoke openly about his position not with the freedom of the Back Benches, but shortly before he resigned from the Government. He said that he felt like a lone voice in the wilderness and that the Government had failed to grasp the magnitude of the environmental challenge. His point was that there was a lack of leadership on environmental issues. When we discuss that lack of leadership, we are talking about the top of the Government.
    A few weeks ago, there was a revealing exchange in the Liaison Committee where the Prime Minister was being particularly articulate and effective. However, his exchange with the hon. Member for East Surrey (Mr. Ainsworth) contained a weak passage about what is being done at No. 10 Downing street about environmental strategy. He was asked, "Are you taking an active role?" He replied, "Yes, in two ways. First of all in the discussions that we have had about so-called liveability at local level, and then most particularly in relation to issues to do with sustainable development at an international level like Kyoto." On the first part of the reply, perhaps I am not fully in the loop on environmental jargon these days. Can the Minister explain what the Prime Minister means when he discusses his role in relation to "liveability at a local level"? What does that mean and what is No. 10 Downing street doing?
    The other issue is more substantial. Labour Members were correct to say that the Government have adopted ambitious targets in relation to Kyoto. We have accepted a commitment to a big reduction, and although it is not quite as big as that accepted by countries such as Germany, we have accepted it and a positive lead is being taken.
    I confess to not having been a great fan of many things that Baroness Thatcher did, but in the late 1980s I worked on one of the first big intergovernmental reports on climate change, which was submitted to the Commonwealth Prime Ministers in 1989 when concern first surfaced about sea level rises. The report was pitched at Mrs. Thatcher—as she then was—in particular. Although she may have had a blind spot over many other issues such as renewable energy and recycling, she was at least aware of the importance of global environmental problems. She took a leadership role on issues such as the Montreal protocol and even persuaded Ronald Reagan, whose environmentalism was best captured in his campaigning slogan about trees being the world's biggest source of pollution, to sign up to it.
    That is in marked contrast to the current Prime Minister, who has staked much of his reputation on his close relationship with the President of the United States. Despite the advocacy and speeches in Congress, however, he has been totally unable to make any serious inroads into US policy on Kyoto.
    Mr. Peter Ainsworth: I am flattered that the hon. Gentleman should refer to my brief exchange with the

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    Prime Minister. When I asked that question, it occurred to me that it was the only moment in the lengthy exchange between the Prime Minister and the Liaison Committee where his eyes went blank and his body language went pear-shaped. The hon. Gentleman is on to the right issue.
    Dr. Cable: That is first-hand evidence to support my suggestion.

    One very important Department, the Treasury, provides leadership and interest in environmental policy, and I am speaking in this debate because I shadow the Treasury. A lot of thought is going on, and the pre-Budget report contains 20 densely argued pages on the matter, and last year there were 100 pages. Many relevant tax instruments and economic instruments are going through the system such as the climate change levy, taxation on landfill and aggregates and the measures on biofuels, which we have discussed today. Innovation is taking place in those areas and, as a broad development in principle, I favour the introduction of economic instruments into environmental policies, which is positive from many different points of view. The introduction of economic instruments sends clear market signals to producers and consumers, it reconciles the environment and the market economy and it encourages the quantification of the economic costs of environmental damage.

    My hon. Friend the Member for Lewes has recently tabled a series of parliamentary questions to which he has received helpful answers from Ministers. The answers suggest that in major areas such as road congestion and nuclear liabilities the aggregate economic cost of current policy is some £65 billion a year, and that is a superficial measure. My hon. Friend's questions help us in another way because they quantify the costs of regulation, which is desirable in itself. The regulation of the environment is, as with other matters, not desirable in itself, and there are often considerable costs associated with it.
    David Taylor: Is the hon. Gentleman aware that under the removal of hazardous substances regulations, lead must be removed by July 2006, but there has been relatively little negotiation and discussion with the electronics industry, which is a major lead user in, for example, solder? Although the Government have a good environmental track record, they should take on board at a much earlier stage the concerns that industries put to them—the aggregate industry and the restriction of hazardous substances directive are two examples of that.
    Dr. Cable: That is absolutely true. One of the advantages of economic instruments is that they enforce discipline in thinking about the problems and costs of regulation. Before I entered this House, I worked in the energy industry and saw at first hand the billions of pounds that often had to be spent across Europe in order to comply with requirements that had minimal environmental benefit. One of the advantages of using economic instruments is that they address that problem.
    Having said flattering things about the Treasury and its approach, there is the major criticism about the basic lack of coherence at the heart of its actions. I make that
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    point as the Opposition spokesman, but the all-party Environmental Audit Committee—I think that this occurred before the hon. Member for East Surrey became its Chairman—produced a critique of the Treasury paper "Tax and the environment: using economic instruments", which is worth quoting. It said:
    "This document, for all its elegance as an economic and policy development treatise, certainly does not amount to an environmental tax and fiscal strategy. It is unclear to us in what way either the review or this document will help the Treasury develop its approach and implement its strategic objective of shifting the burden of tax from goods to bads."
    There are some specific areas in which that lack of coherence is all too apparent. I shall give several examples that came up in the debate.
    The first example is climate change. It has been pointed out already that this country will pioneer a traded permits system, which is positive and I welcome it. However, it will be difficult, because there is no liquid market in permits at present. It will also be difficult to trade across national frontiers, and the scheme will not cover most small and medium-sized businesses. The major instrument at present is taxation, and the Government had the option of introducing a sensible, across-the-board system of carbon taxation that would tax carbon according to its role as a natural raw material. The carbon tax system could have been applied upstream on primary fuels, with minimal administrative costs, and would have spread throughout the economy. The Government did not take that route because they wanted to exempt households and the transport sector. As a consequence, the climate change levy fell almost exclusively on manufacturing industry, at a time when it was already suffering from all the problems of an over-valued exchange rate. The Government then exempted much of the most energy-intensive manufacturing and replaced taxation with voluntary negotiated agreements. That produced a system that is horrendously complicated. Even the most committed environmentalists in the green movement now want that system to be phased out and replaced by a proper system of carbon taxation. That is a good example of adopting the right principle—using a market instrument—but introducing a tax system that was over-complicated, discriminatory and ineffective.
    A second example was mentioned by several hon. Members, including the hon. Member for North-West Leicestershire (David Taylor), and that is the imbalance between the taxation of motorists and of aviation. At the moment, motorists face extremely high rates of taxation—in theory for good environmental reasons, but in practice driven largely by revenue considerations. The Government manage demand for road use through queueing and congestion. That is in marked contrast to their approach to aviation, which is lightly taxed and enjoys a permissive approach to airport expansion, as the hon. Member for Uxbridge (Mr. Randall)—a fellow Heathrow neighbour—reminded us.
    That problem can be dealt with in several ways. The hon. Member for Morley and Rothwell (Mr. Challen) advocated the introduction of aviation fuel taxation, and I support that in principle, although it would be difficult in practice because of treaty obligations. There are other ways to deal with the problem at national level. We have a system of regulation of airports—the so-

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    called single till system—which means that we have ludicrously low landing charges. We have a system of allocating permits for landing, in which they are handed out free of charge on what is called the grandfathering principle. There is no reflection of the scarcity or congestion involved. Both of those systems could be reformed at a national level if we were more aware of the environmental costs.
    The Chancellor has introduced some aircraft taxation—the passenger fuel duty—but it is only obliquely related to environmental costs, because it relates to the number of passengers, not the number of flights. Again, the broad principle of using economic instruments is understood and accepted by the Government, but it is applied incoherently.
    The third example is in energy policy. Other hon. Members mentioned broad agreement with many aspects of the Government's energy policy. When I was my party's spokesman on the Department of Trade and Industry, I spoke on several occasions about the energy White Paper and I broadly agree with the Government's approach. Many of us would sign up to the renewable energy obligation and the commitment to carbon reduction, but the incoherence arises—as my hon. Friend the Member for Hazel Grove (Mr. Stunell) specifically highlighted—between the role of the DTI in energy production and the role of DEFRA in energy conservation. One of the issues that the Minister must explain is why his Department has been so weak in its dealings with the rest of Government on the key issue of the Warm Front programme. That is a small area of Government expenditure, but it is important, because it is one of the ways in which the Government can influence energy conservation and simultaneously address issues of fuel poverty—at relatively low cost. The cut of a third in the Warm Front programme sent a powerful signal that the Government were either uninterested in energy conservation or that DEFRA did not have the clout to deliver it.
    The last example that I want to give is another issue that I dealt with extensively as the shadow DTI spokesman: the Government's approach to car recycling, where we have a European obligation. Again, the broad policy is right and I do not think that any of us have any problems with that. However, it seems that the Government were effectively nobbled by the motor car industry.
    The Government were told that they could not introduce, as they should have done, a sensible environmental tax on the sale of the first car, but that the levy to pay for recycling had to be borne by the last owner. As we know, the last owner is generally at the bottom end of the income scale. Estimates of the recycling cost vary from £40 to £100, so there is a strong incentive for people simply to dump their vehicles, and the evidence that that is happening is already emerging. The total number of abandoned cars was, I think, 295,000 in 2001–02. It rose by 27 per cent. last year. The figure is growing rapidly.
    My hon. Friend the Member for Lewes was unduly flattering when he said that the disposal cost was £40 million; it is probably 10 times that magnitude, for the simple reason that many vehicles are torched and then the fire brigade and the police have to be involved, at a cost of several thousand pounds per vehicle. There are enormous associated costs, and the problem has been
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    aggravated by had policy produced by tension between different Government Departments and the wrong side winning the argument.
    There is a lack of coherence. Where we ultimately come together—and the intervention about the relationship between the environment and the economy was helpful—is in accepting that there is a very sensible principle underlying policy: the whole idea of sustainable development. I worked with Mrs. Brundtland when the original report on sustainable development went to the United Nations Secretary-General and so brought the idea into common use. There was then—and I think it has been accepted since—a powerful insight that, contrary to what many environmentalists had been claiming, there is no fundamental conflict between economic progress and the environment. Indeed, economic progress is vital to remove poverty, which in itself is the major source of environmental pollution. I think that we can all sign up to that.

    For that concept to become really embedded in government, it must be taken seriously and given priority. Our main criticism of the Government is that although the words are right, the actions are often ineffective.
    3.47 pm
    Mr. Morley: With the leave of the House, I should like to respond to the debate.
    Some very interesting contributions have been made—by the hon. Members for Lewes (Norman Baker), for Meriden (Mrs. Spelman), for Hazel Grove (Mr. Stunell), for Uxbridge (Mr. Randall) and for Twickenham (Dr. Cable), and by my hon. Friends the Members for Morley and Rothwell (Mr. Challen) and for Sherwood (Paddy Tipping).
    I can agree with much that was said, but some of the comments, especially those of the hon. Member for Meriden, were a little ungenerous about the role that DEFRA has established and is establishing, bearing in mind the fact that it was formed in 2001 and has come a long way since. The progress that we have made must be recognised.
    In 1997, the waste recycling rate was 7 per cent. We are confident that we shall hit our target of 17 per cent. in 2003–04, and we are on target for 25 per cent. in 2005–06. It is a very challenging target, but we are moving forward. In 1997, the percentage of energy from renewables was 0.7 per cent. We are aiming for 10 per cent. and are extending the target to 15 per cent. This is considerable progress.
    The hon. Member for Lewes quoted Jonathan Porritt. Jonathan Porritt's role in government is to be outspoken; he is there to push us on, and he is very good at it. However, he said of the 2002 Budget that it brought about a series of positive sustainability measures. They include such matters as excluding combined heat and power from the climate change levy, and abolishing stamp duty on the most deprived neighbourhoods. We are dealing with an issue of environmental quality of life. That is what my right hon. Friend the Prime Minister was talking about when he mentioned liveability. It is a very important issue, and I shall return to it. There was also a commitment to look at other matters, such as road wear charges based on distances covered by lorries.

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    A number of hon. Members mentioned airport expansion and other aspects of aviation. The hon. Member for Meriden said that she had had a meeting at Stansted. On that basis, I take it that she does not support the proposal for another runway at Stansted.
    Mrs. Spelman: I should make it perfectly clear that, as an environment spokesman, I was not performing the role of transport spokesman; I was specifically talking about the lack of an environmental impact assessment at any airport in the context of the very prescriptive proposals in the White Paper.
    Mr. Morley: That is very helpful—we understand that the Conservatives are in favour of a second runway at Stansted—but what the hon. Lady says about environmental assessment is not correct. Let us be absolutely clear that detailed environmental assessments must be conducted as part of the evaluation of extra runways. The third runway at Heathrow cannot go ahead until the airport reduces NOx levels, which will, of course, take a great deal of time and investment.
    David Taylor: Does the Minister agree that environmental impact assessments must consider not just extra or longer runways, but significant expansion in use, such as that at East Midlands airport, where stringent noise controls are what the Secretary of State for Transport referred to and what are desperately needed?
    Mr. Morley: That is absolutely right. My hon. Friend makes the point very well that all those issues will be examined, and I fully agree that they need to be examined.
    The hon. Member for Meriden mentioned pioneering good environmental practice. I believe that the Government have pioneered good environmental practice, especially in carbon trading—the UK is the only country in Europe to introduce its own scheme—and in the other work that we have done. I gently remind her that we inherited a number of directives that had never been fully implemented—for example, the bathing water directive, the nitrates directive and the freshwater fish directive. Indeed, some parts of the waste directive were overdue. Those issues have had to be addressed, and we are applying the various environmental directives properly and effectively, as they should be.
    My hon. Friend the Member for Morley and Rothwell rightly referred to consumption and production. Again, the Government have produced a strategy on consumption and production—another pioneering approach that is important for sustainability. He talked about the need to change attitudes towards the approach to sustainability at every level. He is right about that. He also talked about carbon management and renewable energy sources. I am aware of his interest in those issues, and he has some very interesting ideas. I assure him that his views are always welcome, and my door is open to him if he wants to come and talk about them.
    The hon. Member for Hazel Grove talked about structures. Indeed, there is always an argument about the structures of government, but I served in the
    1324
    Ministry of Agriculture Fisheries and Food before it became DEFRA and I have seen the structures change for the better. People in government can always argue about where Departments should go, but the problem is that every issue cannot be dealt with in one Department. Of course people can say that it is good to put planning with the environment or to put transport with the environment—that is all very true—but a balance must be struck about what is effective and what works.
    I believe that the DEFRA structure is very effective. I remind the hon. Member for Meriden that DEFRA brought in Lord Haskins to look at how our agencies work. He concluded not that DEFRA was in any way ineffective but that there should be a clearer split between policy and delivery, as well as more devolution to the regions in relation to delivery, and we do not disagree. Indeed, we will respond to his recommendations in due course.
    Mr. Stunell: I appreciate the line of argument that the Minister is developing, but will he say something about improving co-operation between Departments so that they deliver a coherent objective in the way that he describes?
    Mr. Morley: Absolutely. I mentioned in my opening remarks the joint approach taken by Departments and co-operation across Government structures, such as the green Ministers structure—the ENV committee—but the fact is that there is common working in areas of common interest. That has been established; it is being developed, and it is becoming more effective all the time. DEFRA is establishing itself as an effective Department, both nationally and internationally. There is a lot of interest in DEFRA internationally. A lot of people come to see its structures and how it works. There is a lot of experience in DEFRA—able civil servants, able officials and excellent scientists. People have been attracted to work for DEFRA and have joined in recent years because of the new structures, and we should be proud of the expertise in the Department.
    My hon. Friend the Member for Sherwood was right to talk about the need to address the whole issue of renewables—not only wind, but other important renewables. He mentioned biofuels, in which I know he has an interest. Biofuel production in this country has had an enormous boost under the policies that have been put in place. The last figures that I saw showed that some 2 million litres of biodiesel are produced a week, which is not only due to the 20p reduction in duty, but because it can be grown on set-aside land, which attracts specific subsidies. There is a whole package of measures to encourage the production of biofuels. He was also right to say that there is potential for a range of non-food industrial crops in addition to biofuels. The Government are providing a great deal of support for the research and development of crops such as hemp for clothing and vehicle parts, and bio-oils. There is a great deal of potential for non-food crops, so we are giving that the attention that it deserves.
    My hon. Friend the Member for Sherwood mentioned water. I know that he has a particular interest in sewers, which we talked about during our useful meeting earlier today. There is no doubt that water will be a major political issue not only in this country, but internationally. Although our country has always been

    1325
    considered to be not exactly short of water, water resource management will become more pressing and something that we cannot take for granted. We must recognise that the changes in our weather patterns, with milder and wetter winters and hotter and drier summers, will have a range of implications. Water resource management at every level—drinking water management, and flood and coastal management—will be important.
    Norman Baker: Is the Minister worried that the Deputy Prime Minister is concentrating housing development in the south-east, which is where water resources are under the most stress?
    Mr. Morley: That gives us an example of the integration about which hon. Members talk. Water management and supply is one of the strategies for housing development in the south-east. I assure the hon. Gentleman that there will be no development unless the water supply is secure because that must feature in planning from its initial stages. We are actually going further than that. I mentioned new developments in which one has the opportunity to build in sustainability at the beginning. We are setting a target for new houses in the Thames gateway to reduce water use by 30 per cent., which can be achieved through modest investment in water-saving devices. In fact, we can go further with technology depending on what people are prepared to pay.
    The hon. Member for Uxbridge, who has a long-standing interest in the environment and biodiversity, especially, made several important and sensible points. I agree that sometimes, especially on the international stage, people talk about the environment and biodiversity as two separate issues. That is a mistake, because biodiversity is certainly an environmental indicator. Where there is strong and healthy biodiversity, there is a strong and healthy environment—the two go hand in glove. He will be aware that the Government use several important biodiversity indicators as part of our strategy to measure sustainability and quality of life.
    The hon. Member for Twickenham mentioned leadership. We have put in place a range of measures on liveability. We are addressing fly-tipping, urban life and the quality of life. Our tough targets on climate change are important and require political leadership from the very top. Otherwise, we would not be able to set targets. That emphasises the Prime Minister's commitment to measures such as the landfill escalator, climate change levy and aggregate levy. The hon. Gentleman rightly mentioned the financial instruments from the Treasury, which come from the top in terms of the lead given by the Prime Minister, Chancellor of the Exchequer and Cabinet in the priority given to the World Trade Organisation, reform of the CAP and the emphasis on private and commercial sustainable production and consumption.
    The hon. Gentleman was wrong in respect of end-of-life vehicles. We have reached agreement that they will be the responsibility of the makers of the marques. That scheme will be put in place, along with other directives demonstrating the Government's commitments to sustainability—many of which are admired internationally, most of which are effective and others of
    1326
    which have still to be developed. But no one should doubt the commitment at every level of the Government, right to the top.
    Question put, That the original words stand part of the Question:—
    The House divided: Ayes 183, Noes 306.

    Division No. 50]

    [4:00 pm

    AYES

    Ainsworth, Peter (E Surrey)

    Fox, Dr. Liam

    Allan, Richard

    Francois, Mark

    Ancram, rh Michael

    Gale, Roger (N Thanet)

    Arbuthnot, rh James

    Garnier, Edward

    Atkinson, Peter (Hexham)

    George, Andrew (St. Ives)

    Bacon, Richard

    Gibb, Nick (Bognor Regis)

    Baker, Norman

    Gidley, Sandra

    Baldry, Tony

    Goodman, Paul

    Barker, Gregory

    Gray, James (N Wilts)

    Baron, John (Billericay)

    Grayling, Chris

    Barrett, John

    Green, Damian (Ashford)

    Beith, rh A. J.

    Green, Matthew (Ludlow)

    Bellingham, Henry

    Grieve, Dominic

    Bercow, John

    Gummer, rh John

    Beresford, Sir Paul

    Hague, rh William

    Boswell, Tim

    Hammond, Philip

    Bottomley, Peter (Worthing W)

    Hancock, Mike

    Brake, Tom (Carshalton)

    Harris, Dr. Evan (Oxford W & Abingdon)

    Brazier, Julian

    Brooke, Mrs Annette L.

    Hawkins, Nick

    Browning, Mrs Angela

    Hayes, John (S Holland)

    Bruce, Malcolm

    Heald, Oliver

    Burnett, John

    Heathcoat-Amory, rh David

    Burnside, David

    Hendry, Charles

    Burt, Alistair

    Hogg, rh Douglas

    Butterfill, Sir John

    Horam, John (Orpington)

    Cable, Dr. Vincent

    Howarth, Gerald (Aldershot)

    Calton, Mrs Patsy

    Hughes, Simon (Southwark N)

    Campbell, Gregory (E Lond'y)

    Jack, rh Michael

    Campbell, rh Sir Menzies (NE Fife)

    Jackson, Robert (Wantage)

    Jenkin, Bernard

    Carmichael, Alistair

    Keetch, Paul

    Cash, William

    Kennedy, rh Charles (Ross Skye & Inverness)

    Chapman, Sir Sydney (Chipping Barnet)

    Key, Robert (Salisbury)

    Chope, Christopher

    Kirkbride, Miss Julie

    Clappison, James

    Kirkwood, Sir Archy

    Clarke, rh Kenneth (Rushcliffe)

    Knight, rh Greg (E Yorkshire)

    Clifton-Brown, Geoffrey

    Laing, Mrs Eleanor

    Collins, Tim

    Lait, Mrs Jacqui

    Conway, Derek

    Lamb, Norman

    Cormack, Sir Patrick

    Laws, David (Yeovil)

    Davey, Edward (Kingston)

    Leigh, Edward

    Davies, Quentin (Grantham & Stamford)

    Lewis, Dr. Julian (New Forest E)

    Liddell-Grainger, Ian

    Davis, rh David (Haltemprice & Howden)

    Lilley, rh Peter

    Llwyd, Elfyn

    Djanogly, Jonathan

    Loughton, Tim

    Donaldson, Jeffrey M.

    Luff, Peter (M-Worcs)

    Dorrell, rh Stephen

    McIntosh, Miss Anne

    Doughty, Sue

    Mackay, rh Andrew

    Duncan, Alan (Rutland)

    Maclean, rh David

    Duncan, Peter (Galloway)

    McLoughlin, Patrick

    Duncan Smith, rh lain

    Marsden, Paul (Shrewsbury & Atcham)

    Evans, Nigel

    Ewing, Annabelle

    Maude, rh Francis

    Fabricant, Michael

    Mawhinney, rh Sir Brian

    Field, Mark (Cities of London & Westminster)

    May, Mrs Theresa

    Mercer, Patrick

    Flight, Howard

    Mitchell, Andrew (Sutton Coldfield)

    Flook, Adrian

    Forth, rh Eric

    Moss, Malcolm

    Foster, Don (Bath)

    Murrison, Dr. Andrew

    1327

    Oaten, Mark (Winchester)

    Swire, Hugo (E Devon)

    O'Brien, Stephen (Eddisbury)

    Syms, Robert

    Öpik. Lembit

    Tapsell, Sir Peter

    Osborne, George (Tatton)

    Taylor, Ian (Esher)

    Page, Richard

    Taylor, John (Solihull)

    Paice, James

    Taylor, Matthew (Truro)

    Pickles, Eric

    Taylor, Sir Teddy

    Portillo, rh Michael

    Teather, Sarah

    Price, Adam (E Carmarthen & Dinefwr)

    Thomas, Simon (Ceredigion)

    Thurso, John

    Prisk, Mark (Hertford)

    Tredinnick, David

    Randall, John

    Trend, Michael

    Redwood, rh John

    Turner, Andrew (Isle of Wight)

    Rendel, David

    Tyler, Paul (N Cornwall)

    Robathan, Andrew

    Tyrie, Andrew

    Robertson, Angus (Moray)

    Viggers, Peter

    Robertson, Hugh (Faversham & M-Kent)

    Waterson, Nigel

    Watkinson. Angela

    Robertson, Laurence (Tewk'b'ry)

    Webb, Steve (Northavon)

    Robinson, Mrs Iris (Strangford)

    Weir, Michael

    Rosindell, Andrew

    Whittingdale, John

    Russell, Bob (Colchester)

    Wiggin, Bill

    Salmond, Alex

    Williams, Hywel (Caernarfon)

    Sanders Adrian

    Williams, Roger (Brecon)

    Selous, Andrew

    Willis, Phil

    Shepherd, Richard

    Wilshire, David

    Simmonds, Mark

    Winterton, Ann (Congleton)

    Simpson, Keith (M-Norfolk)

    Winterton, Sir Nicholas (Macclesfield)

    Soames, Nicholas

    Spelman, Mrs Caroline

    Wishart, Pete

    Spicer, Sir Michael

    Yeo, Tim (S Suffolk)

    Spink, Bob (Castle Point)

    Young, rh Sir George

    Spring, Richard

    Younger-Ross, Richard

    Streeter, Gary

    Tellers for the Ayes:Sir Robert Smith and Mr. Alan Reid

    Stunell, Andrew

    Swayne, Desmond

    NOES

    Abbott, Ms Diane

    Burnham, Andy

    Adams, Irene (Paisley N)

    Byers, rh Stephen

    Ainger, Nick

    Caborn, rh Richard

    Ainsworth, Bob (Cov'try NE)

    Cairns, David

    Alexander, Douglas

    Campbell, Alan (Tynemouth)

    Allen, Graham

    Campbell, Mrs Anne (C'bridge)

    Anderson, Janet (Rossendale & Darwen)

    Campbell, Ronnie (Blyth V)

    Caplin, Ivor

    Atherton, Ms Candy

    Casale, Roger

    Atkins, Charlotte

    Caton, Martin

    Baird, Vera

    Cawsey, Ian (Brigg)

    Banks, Tony

    Challen, Colin

    Barron, rh Kevin

    Chapman, Ben (Wirral S)

    Battle, John

    Chaytor, David

    Bayley, Hugh

    Clapham, Michael

    Beard, Nigel

    Clark, Mrs Helen (Peterborough)

    Beckett, rh Margaret

    Clark, Dr. Lynda (Edinburgh Pentlands)

    Begg, Miss Anne

    Bennett, Andrew

    Clark, Paul (Gillingham)

    Benton, Joe (Bootle)

    Clarke, rh Tom (Coatbridge & Chryston)

    Berry, Roger

    Best, Harold

    Clelland, David

    Betts, Clive

    Clwyd, Ann (Cynon V)

    Blears, Ms Hazel

    Coaker, Vernon

    Blizzard, Bob

    Coffey, Ms Ann

    Borrow, David

    Cohen, Harry

    Bradley, Peter (The Wrekin)

    Coleman, Iain

    Bradshaw, Ben

    Connarty, Michael

    Brennan, Kevin

    Cook, rh Robin (Livingston)

    Brown, rh Nicholas (Newcastle E Wallsend)

    Cooper, Yvette

    Corbyn, Jeremy

    Brown, Russell (Dumfries)

    Corston, Jean

    Browne, Desmond

    Cousins, Jim

    Bryant, Chris

    Cranston, Ross

    Buck, Ms Karen

    Cruddas, Jon

    Burden, Richard

    Cryer, Ann (Keighley)

    Burgon, Colin

    Cryer, John (Hornchurch)

    1328

    Cummings, John

    Irranca-Davies, Huw

    Cunningham, rh Dr. Jack (Copeland)

    Jackson, Glenda (Hampstead & Highgate)

    Cunningham, Jim (Coventry S)

    Jackson, Helen (Hillsborough)

    Cunningham, Tony (Workington)

    Jamieson, David

    Curtis-Thomas, Mrs Claire

    Jenkins, Brian

    Dalyell, Tam

    Johnson, Alan (Hull W)

    Darling, rh Alistair

    Jones, Helen (Warrington N)

    Davey, Valerie (Bristol W)

    Jones, Lynne (Selly Oak)

    David, Wayne

    Jones, Martyn (Clwyd S)

    Davies, rh Denzil (Llanelli)

    Joyce, Eric (Falkirk W)

    Davies, Geraint (Croydon C)

    Kaufman, rh Gerald

    Dean, Mrs Janet

    Keeble, Ms Sally

    Denham, rh John

    Keen. Alan (Feltham)

    Dhanda, Parmjit

    Keen, Ann (Brentford)

    Dismore, Andrew

    Kelly, Ruth (Bolton W)

    Dobbin, Jim (Heywood)

    Kemp, Fraser

    Dobson, rh Frank

    Kennedy, Jane (Wavertree)

    Donohoe, Brian H.

    Kidney, David

    Doran, Frank

    Kilfoyle, Peter

    Dowd, Jim (Lewisham W)

    King, Andy (Rugby)

    Drew, David (Stroud)

    Knight Jim (S Dorset)

    Dunwoody, Mrs Gwyneth

    Kumar, Dr. Ashok

    Eagle, Maria (L'pool Garston)

    Ladyman, Dr. Stephen

    Edwards, Huw

    Lammy, David

    Efford, Clive

    Laxton, Bob (Derby N)

    Ellman, Mrs Louise

    Lazarowicz, Mark

    Ennis, Jeff (Barnsley E)

    Lepper, David

    Farrelly, Paul

    Leslie, Christopher

    Field, rh Frank (Birkenhead)

    Lewis, Ivan (Bury S)

    Fitzpatrick, Jim

    Liddell, rh Mrs Helen

    Fitzsimons, Mrs Lorna

    Linton, Martin

    Flint, Caroline

    Lloyd, Tony (Manchester C)

    Flynn, Paul (Newport W)

    Love, Andrew

    Follett, Barbara

    Lucas, Ian (Wrexham)

    Foster, rh Derek

    Luke, Iain (Dundee E)

    Foster, Michael (Worcester)

    McAvoy, Thomas

    Foster, Michael Jabez (Hastings & Rye)

    McCabe, Stephen

    McCafferty, Chris

    Francis, Dr. Hywel

    McCartney, rh Ian

    Gardiner, Barry

    MacDonald, Calum

    Gerrard, Neil

    McDonnell, John

    Gibson, Dr. Ian

    MacDougall, John

    Gilroy, Linda

    McFall, John

    Godsiff, Roger

    McGuire, Mrs Anne

    Griffiths, Jane (Reading E)

    McIsaac, Shona

    Griffiths, Win (Bridgend)

    McKechin, Ann

    Grogan, John

    McKenna, Rosemary

    Hain, rh Peter

    McNamara, Kevin

    Hall, Mike (Weaver Vale)

    McNulty, Tony

    Hall, Patrick (Bedford)

    Mactaggart, Fiona

    Hamilton. David (Midlothian)

    McWalter, Tony

    Hanson, David

    Mahmood, Khalid

    Harman, rh Ms Harriet

    Mahon, Mrs Alice

    Harris, Tom (Glasgow Cathcart)

    Mandelson, rh Peter

    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

    Martlew, Eric

    Hermon, Lady

    Merron, Gillian

    Hesford, Stephen

    Michael, rh Alun

    Hewitt, rh Ms Patricia

    Miliband, David

    Heyes, David

    Miller, Andrew

    Hill, Keith (Streatham)

    Mitchell, Austin (Gt Grimsby)

    Hood, Jimmy (Clydesdale)

    Mole, Chris

    Hope, Phil (Corby)

    Moonie, Dr. Lewis

    Hopkins, Kelvin

    Morley, Elliot

    Howarth, rh Alan (Newport E)

    Morris, rh Estelle

    Howarth, George (Knowsley N & Sefton E)

    Mountford, Kali

    Mudie, George

    Hoyle, Lindsay

    Mullin, Chris

    Hughes, Kevin (Doncaster N)

    Munn, Ms Meg

    Hurst, Alan (Braintree)

    Murphy, Denis (Wansbeck)

    Iddon, Dr. Brian

    Murphy, Jim (Eastwood)

    Ingram, rh Adam

    Norris, Dan (Wansdyke)

    1329

    O'Brien, Bill (Normanton)

    Smith, Llew (Blaenau Gwent)

    O'Neill, Martin

    Soley, Clive

    Owen, Albert

    Steinberg, Gerry

    Palmer, Dr. Nick

    Stevenson, George

    Pearson, Ian

    Stewart, David (Inverness E & Lochaber)

    Perham, Linda

    Picking, Anne

    Stewart, Ian (Eccles)

    Pickthall, Colin

    Stinchcombe, Paul

    Pike, Peter (Burnley)

    Stoate, Dr. Howard

    Plaskitt, James

    Stringer, Graham

    Pollard, Kerry

    Stuart, Ms Gisela

    Pond, Chris (Gravesham)

    Sutcliffe, Gerry

    Prentice, Ms Bridget (Lewisham E)

    Taylor, David (NW Leics)

    Thomas, Gareth (Clwyd W)

    Primarolo, rh Dawn

    Thomas, Gareth (Harrow W)

    Prosser, Gwyn

    Timms, Stephen

    Purchase, Ken

    Tipping, Paddy

    Purnell, James

    Todd, Mark (S Derbyshire)

    Quinn, Lawrie

    Touhig, Don (Islwyn)

    Rapson, Syd (Portsmouth N)

    Trickett, Jon

    Raynsford rh, Nick

    Turner, Dr. Desmond (Brighton Kemptown)

    Reed Andy (Loughborough)

    Reid, rh Dr. John (Hamilton N & Bellshill)

    Turner, Neil (Wigan)

    Twigg Derek (Halton)

    Robertson, John (Glasgow Anniesland)

    Twigg, Stephen (Enfield)

    Tynan, Bill (Hamilton S)

    Robinson, Geoffrey (Coventry NW)

    Vaz, Keith (Leicester E)

    Walley, Ms Joan

    Roche, Mrs Barbara

    Ward, Claire

    Rooney, Terry

    Wareing, Robert N.

    Roy, Frank (Motherwell)

    Watson, Tom (W Bromwich E)

    Ruane, Chris

    Watts, David

    Ruddock, Joan

    White, Brian

    Ryan, Joan (Enfield N)

    Whitehead, Dr. Alan

    Salter, Martin

    Wicks, Malcolm

    Sarwar, Mohammad

    Williams, rh Alan (Swansea W)

    Savidge, Malcolm

    Wills, Michael

    Sawford, Phil

    Wilson, Brian

    Sedgemore, Brian

    Winnick, David

    Shaw, Jonathan

    Winterton, Ms Rosie (Doncaster C)

    Sheerman, Barry

    Sheridan, Jim

    Worthington, Tony

    Shipley, Ms Debra

    Wright, Anthony D. (Gt Yarmouth)

    Short, rh Clare

    Simpson, Alan (Nottingham S)

    Wright, Tony (Cannock)

    Skinner, Dennis

    Wyatt, Derek

    Smith, Angela (Basildon)

    Smith, Geraldine (Morecambe & Lunesdale)

    Tellers for the Noes: Margaret Moran and Mr. John Heppell

    Smith, Jacqui (Redditch)

    Question accordingly negatived.
    Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.
    MADAM DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.
    Resolved,
    That this House applauds the leadership and commitment on the environment shown by the Government domestically and globally; welcomes the UK's climate change programme which has already put the UK on track to overshoot its Kyoto target of a 12.5 per cent. cut in 1990 levels of greenhouse gas emissions by 2012; commends the introduction in the UK of the world's first economy-wide emissions trading scheme; further welcomes the long-term improvement in air quality and steps to improve local environmental quality generally; notes that river and bathing water quality is the highest on record; congratulates the Government on achieving a household recycling rate of 15 per cent. in 2002–03 and being on track for 17 per cent. for 2003–04; further congratulates the Government for playing a key role in the Convention on International Trade in Endangered Species (CITES), increasing protection for a number of endangered flora and fauna; recognises that there is still much to do to promote sustainability at all levels; and calls upon the Government to continue to put environmental protection, locally, nationally and globally at the heart of its policies.
    Mr. Tim Yeo: On a point of order, Madam Deputy Speaker. Are you aware that an hon. Member said today that he had been gagged by Government Whips, who removed him from the Standing Committee that is considering the Higher Education Bill? As the defender of Back-Bench rights, do you share my view that it is scandalous that because the hon. Member for Wirral, West (Stephen Hesford) refused to give an undertaking about the way in which he would vote in Committee, he has been denied the chance to explain why he broke his election promises through voting for Second Reading?
    Madam Deputy Speaker (Sylvia Heal): I remind hon. Members that last week Mr. Deputy Speaker said that "Erskine May" makes it clear that the Speaker cannot interfere in the work of the Committee of Selection, which is responsible for nominations to the Standing Committee. I can add nothing further to that ruling.
    Mr. Andrew Mitchell: Further to that point of order, Madam Deputy Speaker.
    Madam Deputy Speaker: Is it on the same point.
    Mr. Mitchell: It is on a related point.
    Madam Deputy Speaker: I have already ruled on that and there is nothing further that the occupant of the Chair can add.

  Local Taxation
  4.17 pm
  Mr. Edward Davey: I beg to move,
  That this House believes council tax is unfair, should not have been introduced and should be replaced by a system that reflects people's ability to pay.
  Today's debate on the council tax is about fairness in local taxation. Most people agree that fairness may be in the eye of the beholder when the judgment is about the object of one's affections. However, when the object is taxation policy, surely the judgment is less subjective.
  The usual meaning of fairness in the context of taxation is progessivity. Simply put, that means that it is fair that a person's tax bill should increase at least in proportion with their income. It means people paying according to their means; taxpayers paying what they can afford, and tax related to ability to pay. That is not a difficult concept and I hope that it is not controversial. Yet when we apply the fairness test to council tax, what do we find? The poorest pay the most in proportion to their incomes. Whether they are pensioners, low-paid public sector staff or low-paid private sector employees, those on modest incomes pay more in council tax. It is the reverse of fairness and progressivity.
  We are not considering a little unfairness, with the poorest paying a smidgen more, but gross, grotesque unfairness—unfairness not seen since the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) extolled the virtues of the council tax in the House.
  Mr. David Borrow: The hon. Gentleman said in his introduction that fairness must be perceived in terms of income. Does he accept that fairness in terms of ability to pay is not only a matter of income but of wealth and that both must be taken into account when judging whether a tax or a basket of taxes is fair?
  Mr. Davey: The hon. Gentleman is right that we should consider all aspects of a person's wealth when considering overall tax policy, but I wonder whether he wants to force people out of their homes by taxing them through council tax. I would rather ensure that that part of property wealth is taxed through inheritance tax when people die, or through stamp duty when they move. That is the fair way of taxing property. It is much fairer for local taxation to be based on ability to pay—on income.
  Dr. Julian Lewis: There is a certain déjîvu to this debate—I am thinking back to the community charge, which was introduced before the hon. Gentleman and I were in this House. If we had a local income tax, what would happen where a household had three or four wage earners who all paid that tax, whereas previously just one householder had paid the council tax? How would the hon. Gentleman avoid the same sort of demonstrations and upsets that attended the community charge? Is not this the Liberals' version of the poll tax?
  Mr. Davey: I am grateful to have a Conservative intervention so early because I will be asking every
  1332
  Conservative MP who intervenes on me today two questions. First, do they think that the council tax is fair; and secondly, what is their policy on council tax? This House needs to know the Tory party policy.
  Mr. Patrick McLoughlin: On a point of order, Madam Deputy Speaker. The hon. Gentleman has just said that he will ask every Conservative Member who intervenes two questions. Will it be in order for us to get up and answer those questions? If we are asked questions, it is only fair that we have the chance to answer them.
  Madam Deputy Speaker (Sylvia Heal): The occupant of the Chair always tries to be fair to all hon. Members, so I think that we will wait and see as the debate progresses.
  Mr. Davey: Madam Deputy Speaker, I can assure hon. Members that if some of them want to answer those questions, I shall allow them to intervene.
  I can tell the hon. Member for New Forest, East (Dr. Lewis) that the difference between our proposal for a local income tax and the community charge is that one is related to ability to pay and the other is not. Under one scheme, millionaires paid the same as dustbin men; under the other, they would not. That is the difference, and that is why this party stands for fairness and his does not.
  Mr. Lindsay Hoyle: I understand the point that the hon. Gentleman is trying to make, but I wonder whether he shares my worry that the wealthiest in this country usually have the best accountants, who ensure that they pay only a very limited amount of income tax. How would those wealthy people contribute to the hon. Gentleman's local scheme?
  Mr. Davey: I am interested to hear Labour Members defend the very richest in the land. The hon. Gentleman should speak to his right hon. Friend the Chancellor, because if he is failing to administer the tax system properly, this House ought to know about it.
  Mr. Mark Field rose—
  Mr. Davey: I know that Conservative Members are desperate to answer my questions, and I promise that I will give them the chance to do so, but I want to make some progress.
  I shall give the House some measure of the unfairness of council tax. Let us start with households. The richest households pay just 2 per cent. of their income in council tax, but the poorest pay 7 per cent., which is more than three times as much. That figure alone should worry the House, but I am afraid that there are worse examples. Let us look at pensioners. According to the Office for National Statistics, the poorest 20 per cent. of pensioners pay on average 7.1 per cent. of their income in council tax, taking into account council tax benefit and single person's discount. Hon. Members may have examples of pensioners who are paying far more—perhaps 20 or even 30 per cent. of their incomes. I have some such examples in my constituency, but on average,

  1333
  the poorest 20 per cent. of pensioners pay 7.1 per cent. of their income in council tax, which is nearly six times more than the richest 20 per cent. of non-pensioners. They pay just 1.2 per cent. of their income in council tax.
  That is unfairness on an extraordinary scale, and it goes a long way towards explaining why there has been a revolt against council tax in this country.
  Sir George Young: Returning to the question that the hon. Gentleman did not answer, is it not the case that the millionaire to whom the hon. Member for Chorley (Mr. Hoyle) referred will pay nothing at all under the hon. Gentleman's proposals and that, by definition, the less well off will have to make good the difference?
  Mr. Davey: The right hon. Gentleman ought to know better, as I believe he served in the Treasury in years gone by. Under this Government, and under the previous Conservative Government, the Inland Revenue has cracked down on people who evade tax. He ought to be ashamed, because he is saying that this House cannot implement the tax legislation that it passes. That is a very bad precedent to set, and Government figures in fact show that people on higher incomes pay more in income tax, but less in council tax.
  Mr. Andrew Turner: Does the hon. Gentleman accept that he appears to be confusing those who are rich, which is a measure of capital, with those who have a high income? Somebody can be rich and still have nil income, and therefore pay nothing through a local income tax?
  Mr. Davey: If the hon. Gentleman had been listening closely, he would know that I was not doing that. I said that those people with assets and property could be taxed through inheritance tax and stamp duty, and that that was the fair way to do it. I therefore answered that question.
  Mr. Eric Pickles: Will the hon. Gentleman explain what is the Liberal Democrat position with regard to those people who receive remuneration through shares? How will he tackle that with a local income tax? How will he square it with increased share ownership, which is one of the Liberals' aims?
  Mr. Davey: I do not know whether the hon. Gentleman fills in a tax return at the end of the year. These people will, however, and they will therefore pay local income tax on it, as is the case in many other countries.
  Mr. Pickles: My question is simple, and an answer to it will help the House enormously. Will people pay local income tax on what was referred to as unearned income—yes or no?
  Mr. Davey: I am afraid that if the Inland Revenue, under current rules, classes that as income, local income tax will apply to it. If national income tax applies to income, local income tax will apply to income. That is the simple policy that we propose.
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  It is interesting how concerned Conservative and Labour Members are. They are rattled, we know that they are rattled, and that is why "Focus" editors up and down the country are putting out leaflets on the subject.
  Mr. Hoyle: Will the hon. Gentleman give way?
  Mr. Davey: I will do so in a second. I want to make a little progress.
  There is a revolt against local council tax across the country. What is interesting, however, is that the complaints are not just against one council, and they are not just against councils controlled by the Labour party, the Lib Dems, or the Conservatives. There have been complaints against council tax across the country. The anger is nationwide, and it is against the council tax system.
  That is probably why opinion polls on council tax have shifted so sharply in recent times. Only a year ago, 57 per cent. of the public blamed local councils for the council tax rises, while a mere 29 per cent. blamed the Government. Now the position is reversed: 39 per cent. blame the Government, while only 24 per cent. blame councils. People have sussed it out. The national Government are responsible for the council tax system—councils do not choose the local tax system that they use or the local government finance system. That is the job of Ministers, and this lot have opted for the Tory council tax, which is why people are so worried about it.
  What is bizarre about the Government's choice is that it is despite the recommendations and advice of the independent Audit Commission, which echoes the views of the public. It said last December that the council tax system is fundamentally flawed. That is why the House must debate the motion, put matters right and get rid of the council tax.
  Huw Irranca-Davies: Does the hon. Gentleman recognise that one of the greatest and most antagonistic issues with the current council tax is the failure to re-band for too many years? Will he therefore applaud the Labour-led Welsh Assembly Government for introducing a change by spring 2005, which will mean that greater variety exists, instead of lumping everybody together in bands that are 13 years out of date?
  Mr. Davey: If the hon. Gentleman thinks that re-banding is going to solve the problem, I am afraid that he does not understand the post-war history of local government finance. I recommend to him a text that I read in Greece during the recess, when I was boning up on local income tax, which shows that in every decade since the second world war, a local taxpayers' revolt has taken place, whether on rates, poll tax or, now, council tax. The truth is that successive Governments since the second world war have asked local taxation, whether it is on property, individuals or per capita, to do far too much. That is a problem that we must solve, whether through the balance of funding review or our approach.
  Huw Irranca-Davies: If there is a history of revolts year after year—I will read the pamphlet to which the hon. Gentleman referred—what increased burden on

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  the taxpayer does he anticipate, if any, under the Liberal Democrat proposals? Back in September, we were talking about possible increases of 3 per cent., 4 per cent and so on. Will it be a zero point gain, or will people who pay the local income tax have an increase within the first couple of years?
  Mr. Davey: No, they will not. The policy is designed to be revenue-neutral overall. It is not a tax-raising but a tax-neutral policy. The aim is to shift tax-raising power from central Government to local government, which is done in many other countries.
  Mr. Hoyle rose—
  Andrew Bennett rose—
  Mr. Davey: I am going to make some progress, but I promise to give way in due course.
  Our motion is pretty clear. The first part says, very simply, that
  "this House believes council tax is unfair".
  I look forward to hearing from many Members, particularly Conservative and Labour Members, whether they disagree with that part of the motion. If they are going to stand up and put on record that they think the council tax is fair, I am sure that their electors will want to know that.
  Mr. Hoyle rose—
  Mr. Davey: I will give way, because I am worried about the hon. Gentleman's health.
  Mr. Hoyle: While the hon. Gentleman worries about my health, I will ask him a question that will give him something else to think about. Does he know how many airline pilots and people who work abroad have their salaries paid into overseas accounts? The one thing that the previous Government established was that people move but properties do not. That is why they had to return to the old system. How would the Liberal Democrats begin to collect tax from those who are paid abroad in offshore accounts—and there are a lot of them—and how would they assess what those people should pay? Or—this is the key question—would they put the burden back on to the people who are employed in the United Kingdom?
  Mr. Davey: I will not be worrying about the hon. Gentleman's health again.
  What we are arguing is that the national income tax base should remain, and that local income tax should go on to it. If there is a problem with people not paying income tax now, it should be sorted out by the Chancellor of the Exchequer. He should make sure that they pay their dues.
  As I learnt during my sojourn in Greece, many other countries operate a local income tax. It is a tried and tested policy. It works in very left-wing countries like the United States of America and Switzerland; it works in
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  very right-wing countries like Sweden, Denmark, Finland and Norway. The hon. Gentleman may suggest that there are difficulties, but I am afraid that he is wrong.
  Andrew Bennett rose—
  Mr. Davey: I give way to the Chairman of the Select Committee.
  Andrew Bennett: The hon. Gentleman says that his proposal is revenue-neutral. All the upsets over the council tax and the poll tax have related to the problem of those taxes going up. Will the hon. Gentleman now admit that a local income tax will have to keep going up if councils are to provide extra services?
  Mr. Davey: It is revenue-neutral compared with what otherwise obtains. [Laughter.] I am surprised that Members laugh. Obviously if more is to be spent, tax revenue will go up. That is what has happened under the poll tax and the council tax. Members may wish to deny the facts, but I am afraid that they will have to face them.
  One of the real benefits of a local income tax for local government is its buoyancy. Unlike council tax, which must rise every year just to keep pace with inflation, local income tax rates could stay the same because more money would come in as employment and earnings increased. [Interruption.] Of course, the rates could go down if locally elected councillors and local communities wished. That is what has happened in other countries.
  Mr. Graham Stringer: Will the lion. Gentleman give way?
  Mr. Davey: No, I will not.
  When I made my point about the council tax being unfair, I expected Conservative Members to leap to their feet. I am sure that they will in a second. I expected them to do so because their Front-Bench spokesman, the right hon. and learned Member for Devizes (Mr. Ancram), has said that the council tax is
  "as fair a tax as you will find".
  A tax that makes the poorest pay more is a fair tax, according to the Tory Front Bench.
  Mr. George Osborne: rose—
  Mr. Davey: Does the hon. Gentleman want to intervene now?
  Mr. Osborne: I am grateful to the hon. Gentleman for giving way, but I suggest that he answer my questions, rather than trying to turn the tables. Students are currently exempt from council tax. Can he confirm that under the Liberal Democrat proposal, any holiday earnings that they accrue would be taxed?
  Mr. Davey: That depends on whether they earn more than the personal allowance. For the current financial year, 2003–04, there is a tax-free sum of £4,615. If they earned less than that, they certainly would not pay.

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  This is an interesting point that I am sure will be made again during this debate. Conservatives will be desperate to point out the losers under this policy, but they will not point out the gainers. They will not point out that 70 per cent. of people will either gain or be largely unaffected. They will not point out that pensioners and those on low or modest incomes will gain massively. They will not point out that our policy is a major tax cut for some of the poorest in our society.
  We have heard today from the right hon. and learned Member for Folkestone and Hythe the "moral case" for low taxation. The problem is that his party is the party of unfair tax, not low tax. That is its history and heritage, and that is what it keeps supporting.
  Mr. Mark Field: I am an obliging sort of chap, so I shall partly answer the hon. Gentleman's question. I believe that the council tax is a fairer tax than inheritance tax. In terms of elderly pensioners, his party is playing to the gallery by proposing a local income tax. I would like to know by how much Liberal Democrats envisage increasing the inheritance tax take, which would of course affect the estates of many elderly folk, who may not be around for much longer, and who want to pass on their assets to the next generation. They need to be told about that, in advance of the so-called advantages that a local income tax will offer them.
  Mr. Davey: We have no plans to increase inheritance tax, but it is interesting to note the hon. Gentleman's point, which is that inheritance tax is somehow unfair. In some cases, we are talking about people who have literally millions, yet he seems to suggest that on their death, such money should be in no way taxable. That would clearly be wrong.
  Mr. Andrew Turner: Will the hon. Gentleman give way?
  Mr. Davey: No, I have given way to the hon. Gentleman before. The problem for the Conservatives is that in terms of local taxation, they have "form" as long as your arm. That is mainly because they have not got a clue about fairness. I refer them to a debate on the poll tax that took place on 18 April 1988. The then Conservative Minister said—[Interruption.] I shall come a little further up to date with the same person in a moment, if Conservative Members will be patient. In 1988, the then Conservative Minister said:
  "The proposal that we seek to put in place of that discredited system"—
  he was referring to the rates—
  Mrs. Angela Browning: On a point of order. Madam Deputy Speaker. No one on the Conservative Benches can answer for what happened in 1988, apart from my right hon. Friend the Member for North-West Hampshire (Sir George Young), who voted against the proposal in question.
  Madam Deputy Speaker: That is a point for debate and not a point of order for the Chair.
  Mr. Davey: As I was saying, the then Conservative Minister said:
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  "The proposals that we seek to put in place of that discredited system are much better related to ability to pay." —[Official Report, 18 April 1988; Vol. 131, c. 639.]
  The Minister in question was the right hon. and learned Member for Folkestone and Hythe, the current leader of the Conservative party. He was telling the nation that the poll tax was fair, but wait—fairness is apparently a concept that can change. On 11 November 1992, a certain Conservative Minister—there are no prizes for guessing his constituency—said:
  "I am confident that the council tax will be seen to be a fair replacement for the community charge".—[Official Report, 11 November 1992; Vol. 213, c. 873.]
  The council tax is fair, according to the Conservatives. I can assure them that if they fail to change their mind in that regard—if they fail to vote with us tonight—they will be seen by the public not just as the inventors of the council tax, but as the arch-defenders of this discredited system.
  The Tories have a bit of a problem at the moment—the problem of being a true party of opposition. They have no policy on tuition fees, they backed the Government on Iraq, and the Prime Minister hoodwinked them on weapons of mass destruction. On council tax, they are incapable of telling us about their alternative—or at least, their leader is.
  Mr. Andrew Turner: Could the hon. Gentleman help those of us who do not have to travel abroad to get our summer sunshine—we who live on the Isle of Wight—by explaining why he said to a Labour Member that we were asking the tax system to do too much, but then said later that he expected the local taxation system to be given more responsibility, and to take a greater role in the funding of local services?
  Mr. Davey: I will come on to that in a few moments, but the hon. Gentleman knows that I have discussed that matter with him. When a local income tax is in place, it is possible to slash national income tax and reduce some of the subsidies going to local government, allowing local income tax to take the strain. The hon. Gentleman knows that, because I have spoken to him privately about it.
  Mrs. Browning rose—
  Mr. Davey: I will not give way, as I want to make some progress.
  Only 10 months ago, when the current leader of the Conservative party was the shadow Chancellor, he was jumping on the council tax bandwagon. He told The Daily Telegraph that he would
  "change the system of council tax when we come back to office."
  Spotting a scoop, the journalist pressed on and asked the then Tory shadow Chancellor how he would change the system. His reply was short: "I don't know". So we have "I don't know" from a man who has spent years studying local government finance as a Minister. The right hon. and learned Member for Folkestone and Hythe has more ministerial knowledge on that subject than any other Member of the House and has the distinction of having introduced two new local taxes—the poll tax and the council tax—but now the Tory leader does not know.
  Mrs. Browning: Will the hon. Gentleman give way?
  Mr. Davey: No.

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  As I said, the Tory leader was shadow Chancellor a few months ago, presumably in charge of the Conservative tax policy, yet he did not know. Perhaps he has run out of ideas. Well, I have some good news for him. His successor as shadow Chancellor, the right hon. Member for West Dorset (Mr. Letwin) has been thinking. He sketched out the latest Tory thinking in a little noticed interview for The Independent on 10 December last year. According to that newspaper, he said that, in "the short term", the Conservatives
  "would come up with some answers to the problems caused by soaring council tax bills."
  In the short term—yet we are still waiting for their answers. The newspaper report continued:
  "The Tories may propose that the share of council budgets raised locally is increased from 25 per cent. to more than 50 per cent. and the council tax is likely to remain under their plans."
  I am grateful to the right hon. Member for West Dorset for those fascinating words, not least because they amount to the only official Front-Bencher policy that the Tories appear to have on council tax.
  Dr. Julian Lewis: On a point of order, Madam Deputy Speaker. I appreciate that we are having what is called an Opposition day debate, but does that mean that the Liberal Democrats should spend the entire debate talking about the Conservative Opposition? Is it conceivable that they should talk about the policies of the Government?
  Madam Deputy Speaker: Order. I have no doubt that the spokesman for the Liberal Democrats will, when he continues his speech, include some comments about the Government.
  Mr. Davey: You are absolutely right, Madam Deputy Speaker, and you rightly anticipate my remarks, but I have not yet finished with the Conservatives.
  What might the words of the right hon. Member for West Dorset mean? To double the amount of money that councils raise locally, they will presumably have to be given some new tax, or council tax will have to go up. I am a fair and generous person, and given that the Conservatives have not mentioned any new tax and have said that they will keep council tax, I have drawn the obvious conclusion. Council tax will double under the Conservatives. All households will, if they re-elect the Conservatives, see council tax bills of more than £2,000.
  Let us consider what that would mean for average band D council tax for different regions. Under the Tories, people in the east of England would have to pay double the council tax—£2,230. In the east midlands, it would be £2,250 and in London, it would be £2,160—and I could go on. It is a brave policy and "Focus" editors will be interested in explaining it. However, we will refuse to help the Conservatives sell that policy nationwide if they can tell us that they have a different policy.
  Mr. Pickles: The hon. Gentleman is being courteous to the House, but can he reconcile what he has just said with the answers that he gave to the distinguished
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  Chairman of the Select Committee, when he said that incomes and expenditure of councils would rise? I would be grateful if he would tell the House how much the doubling of local income tax would cost.
  Mr. Davey: To most taxpayers, nothing, because national income tax would be cut to offset it. It is, as we have said, a neutral tax policy. I was rather disappointed by what the hon. Member for Brentwood and Ongar (Mr. Pickles) had to say, and wonder whether the Tories have a different plan. If they want to tell us their plans for council tax, we should be very interested to hear them. Until then, we will continue to tell the public that the shadow Chancellor has said that the Tories want to double council tax.
  There is some fresh thinking going on in the Conservative party. Last week, I stumbled across a paper written in 2002 by a certain Mark Nicholson, deputy chairman of the Ealing Southall Conservative association. It was entitled "No Representation without Taxation—"
  Mrs. Browning: On a point of order, Madam Deputy Speaker. The Minister is a generous and understanding man. Would it not be appropriate for him to change places with my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles), so that my hon. Friend can answer the debate when the time comes? Clearly, Labour Members are not involved in the debate, and they could all have a cup of tea.
  Madam Deputy Speaker: I shall leave hon. Members to make their own decisions about staying in the Chamber.
  Mr. Davey: The paper in question was published by the Bow group. Its executive summary states that local government should raise a far higher proportion of its costs through local taxation. We agree. It goes on to say that a local income tax should supplement council tax to allow councils to become self-financing, and that the national rate of income tax should be reduced to compensate for the introduction of the local income tax, leaving the overall tax burden unaltered by the reforms. It is an interesting document, although not exactly Liberal Democrat policy, as it proposes an extra tax and would retain council tax. "Focus" editors would probably call it the "Tory two-tax solution", but it is at least coherent, and spelled out in detail over 46 pages.
  I am grateful to that leading Conservative thinker for his explanation of how a local income tax would work and benefit people. This Conservative member of the Bow group says that a local income tax would improve accountability, protect less affluent areas, improve transparency and not require "any great additional administration". I have decided to send a copy of the pamphlet as a gift to the right hon. and learned Member for Folkestone and Hythe, so that he can get a few ideas. After all, he was chairman of the Bow group in days gone by.
  Mr. Stringer: Will the hon. Gentleman give way?
  Tim Loughton: Will the hon. Gentleman give way?
  Mr. Davey: No. I hope that the Conservatives will come to their senses on this matter, and join our

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  campaign for fairer local taxation, even if that means that Opposition Front-Bench Members have to apologise for getting local taxation so badly wrong twice in one political generation.
  Tim Loughton: Will the hon. Gentleman give way?
  Mr. Davey: I will, as I am about to turn to the Government lot.
  Tim Loughton: I am greatly relieved about that. Before the hon. Gentleman tells us what the mutual aid officer of the Little Piddling in the Marsh Conservative branch had to say on this subject some years ago, will he return to what he said about proposals for increasing the share of taxation that comes from local tax? Does he not realise that that has been happening in practice already? In West Sussex, the share of local spending met by national Government grant five years ago was about 75 per cent.—the average for shire counties—and is now 56 per cent. That has happened not because we have raised council tax by enormous amounts, but because the grants to counties such as West Sussex have been slashed and the money has gone elsewhere. That is another example of the equalisation of the rates that the hon. Gentleman is talking about. Will he also explain—
  Madam Deputy Speaker: Order. That is a rather lengthy intervention.
  Mr. Davey: I am grateful to the hon. Gentleman, as his was one of the first interventions this afternoon with which I could feel any agreement. There is no doubt that the Government have manipulated the grant system, and that their operation of local government finances has not been fair. It must be said that the Government learned most of their lessons from the previous, Conservative Government, but he is right to point out that there have been many examples of unfairness.
  The Government should be most ashamed of their record on council tax. Before 1997, most people thought that a Labour Government would be committed to fairness, especially in taxation. However, the fact that the unfair council tax has survived for nearly seven years under Labour is hard evidence to the contrary. The problem for the Government is that retaining council tax undoes all their attempts to do good works elsewhere. Those attempts include winter fuel payments, free television licences for people over 75, tax credits—the Chancellor of the Exchequer can reel them off. They may all have been designed to help pensioners and the less well-off, but are the recipients truly grateful when their extra cash has to be set against the highly visible and rocketing council tax?
  Last year, the basic pension went up by 2.6 per cent., but the average council tax rose by 12.9 per cent. Council tax takes a record share of the basic pension; on average, it is more than 20 per cent. That unfairness is felt by many erstwhile Labour voters.
  Although the Government are like the Tories, in that they do not have an answer to council tax unfairness, they have at least set up the balance of funding review and the process has, so far, been relatively transparent. The only problem is that Ministers are busy ruling out
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  options before the review has even concluded. I very much regret that, as the review could turn out to be a real shambles.
  Andrew Bennett: The hon. Gentleman is doing the House a disservice; he is spending his time making knock-about points, but there are serious issues in the balance of funding review. If he has confidence in a local income tax system, should he not spend most of his speech trying to explain it to the House so that we can see whether it has any validity and can make a contribution to the review?
  Mr. Davey: The hon. Gentleman anticipates me—I was coming to the balance of funding review. As he knows, we have published full details of our policy; it is on a website and easily accessible, and we are receiving many favourable comments. He should have already seen it.
  The Government's review is supposed to be looking into 12 new revenue sources—at the last count. On the ODPM website, we are told that the review is considering a reformed council tax, a localised non-domestic rate, a local income tax, a localised vehicle excise duty, a localised stamp duty on property transfers, a local sales tax, a local land tax, tourist taxes, new council charges, street works charges, local congestion charging and new, unspecified, environmental taxes.
  Some of us felt that 12 new taxes were a bit over the top, but we were reassured by the Government's comments to The Guardian in October, after those proposals appeared on the website. Ministers were said to be looking at
  "a local income tax as an alternative to council tax and a means of allowing local councils to raise more of their own funds".
  Indeed, the Minister for Local Government, Regional Governance and Fire was reported as saying that replacing council tax with a local income tax was one of the three frontrunners in the review.
  That was music to our ears, but unfortunately, that commitment lasted only 24 hours. That was how long it was before No. 10 Downing street barged in to close down the options and the Prime Minister made it clear that he opposed local income tax. He was at it again when he appeared before the Liaison Committee last week. He repeated his opposition to local income tax and went on, in words that were almost identical to those used by the leader of the Conservative party, to say that the trouble was that he himself did not know what the answer was. So the leader of the Conservative party does not know and the Prime Minister does riot know. That is extremely worrying. The House should be very, very worried. The Prime Minister knows about weapons of mass destruction but he does not know how to reform council tax.
  Mr. Stringer: I have been listening carefully as the hon. Gentleman has developed his arguments on funding for local services and I understood him to say that he wanted less dependence on and interference from the centre. In that case, how can he support a local income tax that would require more intervention and more redistribution from the centre than any tax that has been considered since the 1981 Green Paper?
  Mr. Davey: If the hon. Gentleman were right, he would be right to criticise me, but unfortunately he is

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  completely wrong. The whole point of a local income tax is that it would build a local tax base into the grant formula, so distribution would be automatic—there would not be more intervention.
  The Government must look at the problem more closely. The Audit Commission, in its report on council tax rises last year, stated:
  "The review that the Local Government Minister is chairing on the future funding of local government needs to address the fundamental flaws in the local tax system".
  Those flaws have led to massive council tax rises and if they are not addressed, no amount of threats and capping will save the Government from blame. After all, if, having set up the review, Ministers decide to do nothing, they will deserve to get the blame. They must realise that tinkering with council tax reform will not solve the balance of funding problem. It might make a dreadfully unfair tax slightly less unfair, but it will not stop the gearing effect that is producing above-inflation council tax rises.
  Last Thursday, we held a ridiculously short debate on the local government grant settlement, which touched on some of those problems.
  Sarah Teather: On the grant settlement, does my hon. Friend agree that it is hypocritical to discuss capping council tax or complain about rises in council tax when the Government grant settlement forces a particular council tax outcome? The Government provide a grant based on the difference between what they think local government should spend and the assumed national council tax level. In the case of Brent, council tax must therefore rise by 8.7 per cent. to reach the assumed national council tax level. Brent effectively has two options: it can either set an inflation-busting council tax or it can cut central services that the Government think that it should provide.
  Mr. Davey: My hon. Friend has explained in detail how the council tax system is failing. The Audit Commission says that there are perverse effects where central Government try to insert their tentacles into all aspects of local authority budgets, preventing local authorities from making sensible decisions and pushing them into silly ones. That is why the Government's capping solution is simply not the answer.
  Mr. Parmjit Dhanda: The other side of the coin in respect of the argument made by the hon. Member for Brent, East (Sarah Teather) involves authorities such as Liberal Democrat Cheltenham, which is close to my constituency. Last year's settlement, which included capital, was about 12.5 per cent.; the hon. Gentleman discusses the gearing effect, but Liberal Democrat local authorities such as Cheltenham multiply it by putting council tax up by 13.9 per cent.
  Mr. Davey: The hon. Gentleman fails to mention the rules, restrictions, ring-fencing and passporting that force councils to take decisions, many of which they do not want to take. That is the problem.
  Mr. Adrian Sanders: When the Government claim a 5.9 per cent. increase in their
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  contribution to local government expenditure, it applies only to 75 per cent. of that expenditure and is therefore worth less than that percentage rise. Furthermore, when a local authority sets its budget, it must deal with a public sector inflation rate of around 7 per cent.
  Mr. Davey: My hon. Friend is right, and the situation is worse than he suggests because the 5.9 per cent. increase does not apply to national non-domestic rates. The flawed system needs reform.
  Mr. Borrow: Will the hon. Gentleman give way?
  Mr. Davey: No, I will not give way again because I want to make progress.
  The system is flawed and a problem for the Government is coming down the track. In 2007, several million properties will change council tax band. Some people will enjoy a windfall tax cut; others will see their council tax bills suddenly jump as their houses are re-banded upwards by one or even two bands. It is difficult to know the balance both between losers and gainers and between regions, but initial analysis by the New Policy Institute on the Office of the Deputy Prime Minister website gives us some hints. For example, in London most homes now in band C will go up at least one band and face a tax hike of 15 per cent. on top of annual council tax rises. Those households will, in the main, be on low or modest incomes and contain pensioners and public sector workers—band C homes in London are not mansions.
  A no-reform option from the balance of funding review will sentence such families to a massive hike in a grossly unfair tax, with nothing to show for it just after the next election, which may be the point that Ministers are grappling with. Maybe they think it convenient that the revaluation will occur after the next election. However, I warn the Minister that if the Government cannot promise reform before or at the next election, I hope that they will have the honesty to mention that prospective tax rise in their manifesto, because if they do not do so I promise him that others will. The balance of funding review is a huge opportunity for local government and local taxpayers if Ministers have the courage to take it.
  Ministers know where this party stands on the balance of funding because we have made submissions and published our detailed proposals. Indeed, we have set up a website containing those plans and even answered the questions from the Minister for Local Government, Regional Governance and Fire on our policy. We urge Ministers to consider our policy seriously, and we are prepared to get round the table and discuss it with them. I hope that Ministers in the ODPM can persuade the Prime Minister to get round the table.
  Mrs. Lorna Fitzsimons: It is not good enough for the hon. Gentleman to say that the details are on a website. This is a debate that his party asked for on the Floor of the House. I should like to know which of my constituents will have to pay more tax, when the hon. Gentleman says that other people will have to pay less. Who?
  Mr. Davey: It is very rich for Labour Members and Conservative Members to complain that our party is not

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  publishing its detailed policy. We have published it. It has been widely reported. We are very happy to put it to the balance of funding review. The vast majority of the hon. Lady's constituents would pay less tax under local income tax.
  I want the hon. Lady and her hon. Friends on the Front Bench to persuade the Prime Minister of the virtues of local income tax, and I suggest a strategy: tell him that they have a local income tax in the United States. That might just tip the balance. Tell the Prime Minister that they do not have it in France. but they have it in countries as diverse and wealthy as Japan, Switzerland and Sweden.
  A local income tax is a policy whose time has come. I commend the motion to the House.
  5 pm
  The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Phil Hope): I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:
  "welcomes the current work of the Balance of Funding review of how local government in England is funded; notes that the review is receiving evidence on a number of possible reform options suggested in public consultation; awaits with interest the report of the review in summer 2004; and urges local authorities to set budgets for 2004–05 which deliver value for local taxpayers."
  It is always good to debate the important and complex subject of local government finance. It is a chance to have a good Liberal Democrat baiting session, which I think Conservative Members have enjoyed.
  Unlike the Liberal Democrats, the Government take this issue very seriously. It is currently the subject of our balance of funding review. I listened with great interest to the speech of the hon. Member for Kingston and Surbiton (Mr. Davey) and his attacks on the Conservative party. It was most interesting to hear all of that, but we are here to debate the serious issues facing the country today.
  I have one preliminary point. The hon. Gentleman might have chosen a better day for today's debate, since the Minister for Local Government, Regional Governance and Fire and I are both involved today in the Committee on the Fire and Rescue Services Bill. My right hon. Friend sends his apologies for being unable to be here for the start of the debate, as he is still in Committee. Dedicated and talented though he is, he cannot be in two places at the same time.
  It may be helpful if I start by briefly setting out some background. First, I refer hon. Members to the recent generous grant settlement for local authorities in England. This is the essential context of the issues facing the local government finance system and the reality of what is happening now.
  Last Thursday, my right hon. Friend put before the House proposals confirming that the total of formula grant would be £46.1 billion in 2004–05, an increase of 5.5 per cent. compared with 2003–04. On top of that, specific grants take the overall increase to no less than 7.3 per cent.
  Of course, it is not a one-off increase. It is part of a programme of sustained growth in investment in the vital public services delivered by local government.
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  Overall Government funding to local authorities is up by 30 per cent. in real terms over the past seven years. That is in stark contrast to the previous four years, when year-on-year cuts were the norm—a 7 per cent. real-terms cut over that period.
  Conservative Members may wish to forget their responsibility for the realities of life in that era, when real-terms cuts were the order of the day. However, those involved in local government, including some of my hon. Friends and me, do not have such short memories. They know the change that has occurred. They know that in 2004–05, for the second year running, all local authorities receive a real-terms increase in formula grant on a like-for-like basis.
  As the hon. Member for Kingston and Surbiton said only last week,
  "it is a generous settlement…the settlement is far more generous than anything ever proposed by the Conservatives." —[Official Report, 5 February 2004; Vol.417, c.990.]
  I am grateful for that recognition.
  I am pleased to say that in recent grant settlement we have removed ring-fencing from some £750 million of specific grants, and thus reduced the ring-fenced grant from over 13.3 per cent. to about 11 per cent. of the total grant. That is part of our commitment to reverse the trend on the ring-fencing of grants to local authorities.
  Mr. Pickles: Will the hon. Gentleman concede that ring-fencing is still slightly over three times the level that the Government inherited in 1997?
  Phil Hope: The hon. Gentleman makes a fair point, but the direction of travel is now definitely right, with less ring-fencing and therefore more freedoms and flexibilities to local authorities.
  I come to council tax rises.
  Mr. McLoughlin: I should like to take the Minister back to what he said a few moments ago. He was talking about the amount of money by which the Government have increased the grant to local authorities. Given that what he says is true—and I do not argue with his figures—why have our constituents seen such a large rise in council tax over the past few years, when in the years when he says there was a reduction in council grant there was actually a smaller increase in council tax levels?
  Phil Hope: I was coming to precisely that point. Given the generous grant settlement for next year and the scope for efficiency improvements, our view is that local authorities can and should deliver council tax increases in low single figures in 2004–05, so we are now looking at proposed council tax rises very closely. We are pleased that initial indications suggest that many authorities have listened and are planning increases in low single figures. For example, Southampton is talking about a council tax increase of 2.9 per cent.; Birmingham, 1.5 per cent.; Dudley, 1.5 per cent.; Derbyshire, 2.9 per cent.; and Suffolk, 3.9 per cent.
  Mr. Ivan Henderson: Is my hon. Friend aware of the situation with my local council, Tendring district council, which is run by the Conservatives? In May last year, the Conservatives on the council said:

  1347
  "Your Conservative district councillors have implemented the lowest Council Tax increase in Essex and one of the lowest in the UK".
  The increase was 2.5 per cent. because the Government were so generous in giving them a good increase previously. Less than six months later, they were advocating an increase of 30 to 45 per cent. Is not the serious concern regarding such councils either that they are playing games for elections or that they are bad financial managers? They need to be looked at seriously.
  Phil Hope: My hon. Friend makes an excellent point. Despite significant extra investment, some local authorities—he has just quoted his own. Tendring— have not listened, and they have indicated that they will impose large council tax increases. I shall give some examples of authorities proposing very high rises. Torbay is proposing a 17.5 per cent. increase; Leicester, 14 per cent.—a subject of debate in the House last week—Milton Keynes, 11.1 per cent.; Dover, 17.1 per cent.; Warwick, 24 per cent.; Waverley, 14 per cent.; Rother, about which we had a debate in the House last night, 13 per cent.; Medway, 15 per cent.; and Brighton and Hove, 13 per cent. Those are simply unacceptably high council tax increases.
  My right hon. Friend the Minister for Local Government, Regional Governance and Fire has now written to no fewer than 65 local authorities about which we have seen reports of council tax increases that are not in low single figures, and he is planning to call in some authorities. It appears inevitable that the Government will have to use their capping powers this year.
  Mr. Pickles: Will the hon. Gentleman confirm whether the letter has now gone to the Mayor of London?
  Phil Hope: I cannot confirm at the moment whether the letter has gone to the Mayor of London. There is a complicated debate between the Greater London authority and the Mayor, but he will receive a letter if he is considering such an increase. Indeed, no sooner have I answered the question than I am holding in my hand the letter that has gone to the Mayor of London.
  The hon. Member for Kingston and Surbiton prayed in aid the Audit Commission to explain the increases. saying that they were all the Government's fault. Let me remind him that the chairman of the Audit Commission said, in commenting on the settlement, that there are a number of factors behind the rises this year and that trying to find a single point of blame is not only counter-productive, but simply not borne out by the evidence. It is interesting that, although we are still gathering information about council tax increases, our initial reports show that the average increase in Labour councils is about 5 per cent., but Conservative councils are coming in at about 7 to 8 per cent.—and, yes, hon. Members will be glad to hear that Liberal Democrat councils are coming in at about 8 to 9 per cent. Perhaps
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  one reason why we are hearing about alternatives to the council tax is that Liberal Democrat councils cannot budget awfully well.
  Mr. Edward Davey: Will the Minister confirm that Liberal Democrat councils had the lowest rises last year?
  Phil Hope: I am discussing the council tax for next year, and Liberal Democrat councils are coming in with much higher figures than the others, although the Tories are not far behind.
  I come now to the balance of funding review, which is the essence of today's debate.
  Mr. Pickles: I am grateful to the hon. Gentleman for giving lots of information. Will he tell us which political party has the lowest council tax, band for band? Would that be the Conservatives?
  Phil Hope: Unfortunately for the hon. Gentleman, the average band D council tax in Conservative councils is now higher or equal to that in Labour councils, so the previous position, which I think he was trying to put, no longer applies.
  Sir Paul Beresford: Will the Minister give way?
  Phil Hope: I want to move on to the balance of funding review, if I may.
  The review's steering group has met several times over the past few months. It discussed the principles of a successful local government finance system, held a public consultation and commissioned independent research, all of which is publicly available. It is now discussing possible reform options. I shall take a moment to emphasise one of its research findings. Many members of the public are not clear where accountability for local government services lies or where the money comes from. However, what matters to them is not where local authorities get their money, but that services are efficiently delivered. According to the review's research, there seems to be no sign of a direct link between balance of funding and local election turnout. That was a surprise to many of us.
  What are the options for reform of balance of funding? The hon. Member for Kingston and Surbiton talked about 12 options, but the review is examining four. Given today's debate, hon. Members will be interested to learn that one of them is indeed local income tax. The others are a reform of council tax, the relocalisation of business rates, and a mixed option of smaller taxes or charges. I should emphasise that the fact that the review is hearing evidence on different options is not an indication that the Government accept that the balance of funding must be changed, nor that they favour any of the reform options. One difficulty with an open debate is that it can be open to abuse. If all information is published on websites so that people can engage in the debate openly, the inevitable party politicking starts and positions are misrepresented. The hon. Member for Kingston and Surbiton did that, and I shall come back to it later.
  The hon. Gentleman asked whether we had ruled anything out, but one option that we are not considering is a return to the Tories' failed community charge, or the

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  poll tax as it was popularly—or, perhaps, unpopularly—known. Many hon. Members will remember that one of the consequences of that rushed reform was that value added tax increased to 17.5 per cent. to raise an additional £140 per community charge payer in central Government support. That is one reason why a considered approach to these matters is essential, rather than a knee-jerk response based on slogans such as "Axe the Tax" or "Scrap the Cap". There is nothing like a good Liberal slogan—frankly, they are nothing like good Liberal slogans.
  Mr. Edward Davey rose—
  Phil Hope: I shall give way to the hon. Gentleman, who will no doubt give me another slogan.
  Mr. Davey: Will the Minister confirm that, although he has ruled out the community charge, he has not ruled out the local income tax?
  Phil Hope: I am looking forward to reaching the part of my speech about the local income tax, but first I want to talk about something that the hon. Gentleman skipped over during his speech: reform of council tax. Many responses to the review consultation said that there were serious problems with council tax, including the questions of fairness with which he opened the debate, but most suggested that it could be reformed rather than abolished. The tax was widely accepted until recently. It has advantages—for example, it is relatively easy to understand and collect. Indeed in 2002–03, local authorities in England collected more than 96 per cent. of the council tax due within the financial year.
  Mr. Borrow: Does my hon. Friend agree that any Government should be reluctant to give up a property tax in favour of increasing an existing tax, as the Liberal Democrats propose? If the Government were to do that, the likelihood is that a future Chancellor would resurrect a property tax because it makes sense to have a good basket of taxes, of which a property tax should be part.
  Phil Hope: My hon. Friend is a renowned expert in the field and I am grateful for his excellent point.
  What kind of reforms to the council tax might we be talking about? Such changes include the revaluation of domestic properties, to which we are already committed and which is currently planned for 2007. That will ensure that a council tax bill is based on the up-to-date value of a house rather than its value in 1991. I make the especially important point that the revaluation is not designed to raise more tax overall. Our 2001 local government White Paper made clear that its overall impact would be neutral. The hon. Member for Kingston and Surbiton misses the point. At the same time as revaluation, we will consider the case for changing the existing bands. Quoting revaluation without taking into account band changing, as he did in respect of London properties, is disingenuous
  The point came through strongly from the consultation that council tax should reflect more closely people's ability to pay and mirror with more accuracy
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  variations in property values. Ways of doing that mentioned during the review include introducing new bands or a regional banding system. I make it clear that we are not committed to any particular changes. Before changing the banding system. we would need carefully to examine the impact on groups such as pensioners on low or fixed incomes living in high value properties. It simply will not do for Liberal Democrats to scaremonger by quoting selectively from documents from the balance of funding review or for them to avoid key questions from hon. Members in all parts of the House about their proposal to increase stamp duty and inheritance tax.
  Another key issue identified by the reviewers is resolving problems relating to council tax benefit—an inbuilt way of achieving more progressivity in local taxation, which the Liberal Democrats say they want. Council tax benefit helps people on low incomes, including many pensioners, with their payments. The problem is that many people are not aware of their right to that money—1.4 million are eligible but not claiming. Some who are aware are put off by the perceived stigma of claiming a benefit and are reluctant to claim other than the state pension. It is for local and central Government together to do all they can to ensure higher take-up. We are already abolishing the restriction that limits the maximum council tax benefit for property in bands F, G and H from 1 April. We are also considering whether other improvements can be made to the system.
  Mrs. Annette L. Brooke: Is not the Minister making the argument for local income tax? The poverty trap that he described, with people either not claiming council tax benefit or just missing out, is where the tax really hits people.
  Phil Hope: I am intrigued by the hon. Lady's intervention because the motion does not mention local income tax but states that
  "council tax is unfair, should not have been introduced and should be replaced by a system that reflects people's ability to pay."
  The motion does not say that council tax should be replaced by local income tax—although that was mentioned by the hon. Member for Kingston and Surbiton. I have demonstrated how we can reform council tax by re-banding and benefit changes that will better relate to people's ability to pay. I am surprised that the hon. Lady cannot support those reforms, given that their outcome matches the Liberal Democrat motion.
  Replacing council tax completely with local income tax is the solution favoured by the hon. Member for Kingston and Surbiton and his colleagues. The balance of funding consultation showed support in some quarters for replacing or supplementing council tax with local income tax—or at least considering the case for doing so. The Prime Minister has made it clear that the Government do not favour replacing council tax with local income tax, but we are certainly prepared to listen to reasoned arguments. Local income tax is one of four issues on which we are asking expert organizations—in this case, the Chartered Institute of Public Finance and Accountancy—to provide further evidence on the pros and cons. It will give a presentation at the next meeting of the balance of funding review steering group in

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  March, which will be attended by Liberal Democrat and Conservative members of the Local Government Association.
  Liberal Democrats have focused on the importance of relating local government tax sources to the ability to pay—by which standard, as was indicated by the hon. Member for Mid-Dorset and North Poole (Mrs. Brooke), they argue for the superiority of local income tax. Council tax can be made more progressive for the lowest income tax group by increasing the take-up of council tax benefit. I hope that all right hon. and hon. Members will help to resolve that issue by fully supporting our campaign.
  The argument is made that local income tax works so well and is so popular in other countries that it should be introduced in Britain. International experience does not justify that rosy picture. It certainly does not justify abolishing our domestic property tax and relying entirely on local income tax. Last week, the hon. Member for Kingston and Surbiton said that he would be happy to take my right hon. Friend the Minister for Local Government, Regional Governance and Fire to countries with a local income tax system. I advise them to wrap up warm, because the only country in Europe to rely on a local income tax is Sweden. Other EU countries rely partly on a property tax, as my hon. Friend the Member for South Ribble (Mr. Borrow) said. Spain and Italy are increasingly reliant on such a tax. Only five countries in Europe have a local income tax, and in four of them—Belgium, Denmark, Finland and Italy—it is one of several forms of taxation. All that information is available on the website of the Office of the Deputy Prime Minister.
  As various countries have been bandied about, hon. Members should be aware that comparisons between UK local government finance systems and those of other developed countries do not compare like with like. Different countries have different political and legal systems, their terminology and data are often incompatible with ours, and state finance systems do not stand still. I fear that the proposals for a local income tax advocated by the hon. Member for Kingston and Surbiton would result in disruptive and complicated changes to the tax system. First, they would do little to improve the flexibility available to local authorities. The Liberal Democrats would increase the proportion of local funding from central Government by using £1.7 billion of their proposed higher rate tax increase to increase grant and keep local income tax bills down to 4p in the pound.
  Mr. Edward Davey: It is 3.75p.
  Phil Hope: I would not like to get the figure wrong, but I can readily envisage it creeping up to 4p under the Liberal Democrats. They will use £1.7 billion to keep the local income tax bill down. Authorities in poor and deprived areas will collect less income tax than the richest areas, so the hon. Gentleman's proposals would mean that poorer authorities would become more heavily dependent on grant. There would be less flexibility and a worse gearing effect for those authorities than at present.
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  Secondly, there would be substantial costs, which are not mentioned in the Liberal Democrats' proposals. They would combine their local income tax with an increase in the level of personal allowance to £5,000, but that would cost an extra £2.4 billion—
  Mr. Davey rose—
  Phil Hope: I have tried to do the maths, and shall see if I have got it right before giving way to the hon. Gentleman.
  The Liberal Democrats will raise £4.7 billion from their tax increases for the higher paid. They will spend £1.7 billion on local income tax, and £2.4 billion on raising the threshold for income tax. They will then use an additional £2 billion to abolish university tuition fees—that emerged in a press release issued by the leader of the Liberal Democrats before Christmas—and £1 billion to pay for care of the elderly. That adds up to £6.7 billion, all of which will be paid from an increase in taxation of £4.7 billion. The Liberal Democrats are therefore £2 billion short.
  However, it does not end there. My right hon. Friend the Prime Minister has drawn attention to other spending pledges by the leader of the Liberal Democrats. There are 70 such pledges on top of that £6.7 billion, including free eye and dental checks, a new community safety force and cutting primary class sizes. We would all like to have those wonderful things, but how will the Liberal Democrats pay for them, given that they are at least £2 billion short?
  Mr. Davey: I want to put the hon. Gentleman out of his misery. We have made our spending package clear in letters to the Prime Minister, and the fact that he does not appear to take our word for it is a disgrace. If the hon. Gentleman reads the document in which those figures appear, he will see that it is clear that the £5,000 allowance would be introduced when our proposals are implemented. If implemented in 2003–04, we would stick with the current allowance of £4,615. It is a disgrace that the Government and Ministers are not prepared to accept what we have said in a published document.
  Phil Hope: The hon. Gentleman has just demonstrated why the Liberal Democrat figures cannot be trusted—they simply do not add up.
  Finally, the Liberal Democrats' proposals on local income tax have weaknesses that they have not considered. They have two ideas for collecting the tax—one is to collect it during the year through tax codes, the other is to collect it at a standard rate across the country, then settle up with individual taxpayers to reach what they should have paid at the end of the year by using the year-end adjustment process. The Liberal Democrats do not appear to have taken into account in their costings the additional costs for employers arising from the first proposal. Employers would have to deal with local income tax rates for every local authority in which their employees lived, and would have to account separately for the different amounts of local income tax subtracted from their employees' wages. The Liberal Democrats simply have not considered that in their costings for local income tax.
  Matthew Green: Clearly, the Minister has not been involved in administering PAYE in a small

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  business. It is already the case that virtually any employee will have a different PAYE code from another because of the many different circumstances that can apply.
  Phil Hope: I do not think that my PAYE form has a location code on it. Under the Liberal Democrat proposals, I would have a variety of location codes depending on where I lived, where I worked and where I paid my income tax.
  Andrew Bennett: Does the Minister accept that one of the problems is that many people pay council tax on more than one property? Would not considerable difficulties arise in trying to apportion their income tax commitments between two different properties?
  Phil Hope: I have no idea of the answer to that, but it is not my problem. It seems that the Liberal Democrats would offer choice to everybody, leading to goodness knows what chaos.
  Mr. Davey: It is interesting that the Minister does not know the answers to these questions, because they are in the document from which he quoted and the letter that I wrote to the Minister for Local Government, Regional Governance and Fire. Either he is not communicating with the Office of the Deputy Prime Minister or he cannot read.
  Phil Hope: The correspondence between my right hon. Friend and the hon. Gentleman makes for entertaining reading, because it is full of questions but offers precious little in the way of answers from the Liberal Democrats.
  The second option would be an odd compromise that would satisfy no one—a local income tax under which most of the time the bill that one paid had nothing to do with the rate set by one's local authority. How would such a system promote local accountability and flexibility, and how would it aid the taxpayer in understanding how much money their council was asking from them or spending on services? In addition, given that the mechanics of the tax system mean that underpayments or overpayments would not be fully settled for months or years, it would be doubly complex and unpredictable for individual taxpayers, local authorities and the Inland Revenue. When it comes to a local income tax, a slogan sounds good, but the reality is unacceptable.
  The third issue that was highlighted by the balance of funding review consultation was the relocalisation of non-domestic or business rates. For the past 10 years, although local authorities have collected business rates they have not set the level of rates or kept the proceeds. Now, central Government set a national business rate and redistribute the money to areas on a per capita basis. Relocalisation—a return to the pre-1990 system—is not something that the Government have favoured in the past, but there is strong demand for it from many in local government. Most consultation responses from councils argued that relocalisation would resolve the balance of funding problem and encourage better partnerships with local businesses. However, many in the business community would be strongly opposed to any change to the level playing field for business. The balance of funding review is continuing to address that problem.
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  The fourth and final option that is being considered in the public consultation is the mixed option of smaller taxes or charges, which is sometimes called the basket option—I think that the chairman of the Local Government Association calls it the cornucopia option. The LGA is among those who are keen to explore this option, which covers a wide range of possibilities that build on the freedoms already given in the Local Government Act 2003, including localised vehicle excise duty, localised stamp duty on property transfers, land value taxes, hotel bed taxes and more charges for the use of local services. I have not got time to go into more detail, but I stress yet again that because the Government are listening to evidence from interested parties who favour those options does not necessarily mean that they are the Government's favoured options. If Members want openness and transparency in debating these issues, it is important that they do not pretend, as did the hon. Member for Kingston and Surbiton, that there are 12 new taxes. That is an unacceptable way to conduct the debate.
  I welcome the debate, which has given a good airing to some important issues. People will have more to say, and we look forward to hearing it. Those of us who are directly involved—myright hon. Friend the Minister for Local Government, Regional Governance and Fire is here—will take careful note of all the points that have been raised. It is clear to us that many people have serious concerns about many aspects of the local government finance system, especially gearing and the impact of council tax rises on taxpayers with fixed incomes. It is also clear, however, that there are no easy fixes or quick wins. This Government will not return to the dark days of the Tory poll tax, nor will we be conned by Liberal Democrat proposals for an uncosted and unworkable local income tax—instead, we will analyse the options carefully. In the meantime, local government and the people it serves can be satisfied that the Government are committed to providing and supporting local services.
  5.29 pm
  Mr. Eric Pickles: It is a pleasure to see the Minister for Local Government, Regional Governance and Fire in his place. My right hon. Friend the Member for Skipton and Ripon (Mr. Curry) would have liked to participate in the debate, but he is awaiting news of the birth of his first grandchild. We look forward to the time when he can come to the Dispatch Box and say, "We are a grandparent."
  The debate has been interesting so far. Interventions from my hon. Friends and Labour Members did an effective job of destroying the Liberal Democrats' local income tax plan. I am therefore left with the slightly humbler task of bayoneting the wounded.
  At times, I felt sorry for the hon. Member for Kingston and Surbiton (Mr. Davey). For him, the past few months must have been a living hell. He has been saddled with the most unworkable and impractical of all Liberal Democrat policies; no extended sojourn on the Greek islands could possibly have made up for that dreadful task. The policy was devised when the Liberal party was a single entity and its activists were bearded, sandal-clad men of a certain age and earnest young women sporting tank tops. It belongs with such other Liberal Democrat policies as giving the vote to

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  prisoners, legalising cannabis while simultaneously banning smoking in public and outlawing goldfish from funfairs. It is the hon. Gentleman's misfortune to have to try to make the misdirected policy credible. I tell him, with oodles of affection, that he sadly failed to do that today.
  The hon. Gentleman's response to the Minister's 10 questions dated 14 October was a master class in why one should always ignore letters from political opponents. In the autumn, Liberal Democrat headquarters supplied a draft motion on local income tax to their groups on local councils. Among my many duties, I monitored those debates. I apologise to the Whip because I am sure that I shall get into terrible trouble with my party hierarchy, but I have a confidential report on the debates from central office. In a spirit of openness and glasnost, I am prepared to risk discipline by reading out its main conclusions.
  One must understand how one should read a central office report, and I admit that the first two points are predictable. [Interruption.] There may be some pleasant surprises for the hon. Member for Kingston and Surbiton in the report. The first point states:
  "Conservative councillors…were well prepared for when the debate occurred in council",
  which is nice; it is good to know that. The second point emphasises:
  "Conservative councillors are united against the motion put forward by the Lib Dems."
  The third point is a little worrying for the hon. Gentleman. It states:
  "Where it has been debated Lib Dems are often ill prepared and ill informed of the particulars of the motion. In several cases the motion was not unanimously supported by all Lib Dem members."
  Oh dear! I cannot imagine that. There is some comfort for Labour Members because the document states:
  "Labour groups are generally voting against the Motion en bloc."
  I have a list of those who did not, which is available for a reasonable fee afterwards. The fifth point stresses:
  "Media attention around the motion has been poor."
  Oh no!
  Let us take some random examples, which I have highlighted for the convenience of reading them out. On Bournemouth, the document states that
  "two Liberals abstained. (on an amendment to their own motion—one of them is the husband of the Lib Dem MP."
  I have no idea who that is. In Devon,
  "the Lib Dem opposition"
  said that
  "the main anomaly with the local income tax policy was that young couples with a big mortgage, children and heavy outgoings would be 'very hard hit' by the local income tax policy."
  That does not seem terribly on-message. Let us move to Harrogate, about which the document states:
  "The proposer and the seconder were extremely cagey on the LIT proposal and seemed reluctant to even say that they supported it instead of saying that the motion was one of principle rather than specifics."
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  We can sympathise with them.
  In Norfolk, I read that Liberal Democrats tried to disguise the tax
  "as the sort of locally raised tax that everyone could support and the proposer made great play of the fact that she had never mentioned local income tax."
  I have just two more examples, and it is hard to say which is my favourite. This one was my favourite until I got to the last example. It is from Poole, and says:
  "Lib Dems said…that the regional income tax was no longer a policy and made mutterings and shouted about savings being made"
  from local income tax. I think that that is pretty good, but this last one is the best. It is from Somerset, and says:
  "Their cause was not helped by David Laws MP for Yeovil's website which showed under 20 per cent. supporting their idea of local income tax!"
  We look forward to what the various "Focus" teams say. We even heard a report of a Liberal Democrat leaving the Chamber rather than debating the issue. I thought that that was cowardice until I heard the hon. Member for Kingston and Surbiton speak today; now it seems like wise tactics.
  Mrs. Brooke: I am sure that as I was inadvertently referred to I can make a brief response. It is true that at a Poole council meeting my husband abstained on a Conservative amendment. However, my point in intervening is to ask the hon. Gentleman to tell us whether the Conservatives proposed alternative policies in all the council meetings to which he has referred, or whether all those councils were simply satisfied with the council tax.
  Mr. Pickles: Indeed, I will come to that point. I am sure that the hon. Lady's apology to her party will be noted and that it will not at all affect her chances of success.
  When the Minister was kind enough to take an intervention from me, he suggested that band D levels were equal between Conservative and Labour councils. However, according to the latest figures, which are for last year, the Conservative level was £1,030, the Labour level £1,111 and the Liberal Democrat level £1,129. Given that councils have not determined their figures for this year, what the Minister said to the House on that was clearly inaccurate. Would he like the opportunity to withdraw his earlier comments?
  Phil Hope indicated dissent.
  Mr. Pickles: I am sorry about that, because the facts speak for themselves.
  I shall refer in a few moments to the point that the hon. Member for Mid-Dorset and North Poole (Mrs. Brooke) made, but first I have some comments on local income tax. Much has been made of the effect that the tax would have on different categories of person. Council tax is based on two adults sharing a house, with a discount for single occupiers, reflecting a crude recognition of the use of local services. Many families with two people working would be worse off under the Liberals' proposals, and families on average earnings would be particularly badly hit. It is important for the House to remember that in most households with two

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  people working, they are doing so from necessity to make ends meet. As the Sunday Express has pointed out with some force, there would be a tax blow under a local income tax, with bills rising by 60 per cent.
  Let us aid consideration of the matter by using the figures that the hon. Member for Kingston and Surbiton supplied. Let us assume a local income tax rate of 3.75 per cent., and take a couple on average male and female earnings paying an average council tax bill under this year's tax system. Whether they live in England, Scotland or Wales, local income tax would be more expensive for them than the present system. In England—
  Matthew Green rose—
  Mr. Pickles: I shall just give the hon. Gentleman the figures; then he can dispute them. In England, the couple would pay an extra £547 a year, in Scotland an extra £510 a year and in Wales an extra £471 a year. Were there a third or fourth person earning in the household, there would be a heavy extra burden. A son or daughter still at home with their parents and just starting out at work would find the tax very heavy.
  Matthew Green: It would be helpful if the hon. Gentleman confirmed that the median household income in the UK is £21,700, and not the £48,000 that the Conservative briefings quoted in the Sunday Express suggested is the average household income. I would love to know where all those people earning that amount are.
  Mr. Pickles: I am sorry that the hon. Gentleman disputes our figures, because they stand the test of scrutiny. We are talking about average male earnings— I do not think anyone would dispute that that figure is £525 a week—and average female earnings, which are £396 a week. Those are the facts—[Interruption.] The hon. Gentleman should face reality. People on average earnings will lose out under his proposals, and the Liberal Democrats' blindness to that fact is leaving them looking utterly foolish.
  David Taylor: I am reluctant to rise to the defence of the Liberals, but will not the hon. Gentleman accept that there can be an enormous difference between median income and mean income because of the distorting effect of the many huge household incomes at the upper end of the spectrum? It is therefore fair of the hon. Member for Ludlow (Matthew Green) to quote the figure of £21,700.
  Mr. Pickles: I am not disputing what the hon. Gentleman says about the difference between median and mean incomes. I choose my figures carefully—[Laughter.] They are based on income, because we are debating a local income tax. It is right to take into account the level of people's incomes in such a debate. The hon. Member for North-West Leicestershire (David Taylor) should remember that the proposal is for 3.7 per cent. on top of existing base rates, and is based on incomes between £5,000 and £100,000.
  Students, student nurses, apprentices and young trainees are exempt from council tax under the Local Government Act 1992. The Local Government Act 2003 goes further in removing their joint and several
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  liability if they live in a house with non-students. Yet under the Liberal Democrats' plan, students who work hard will pay local income tax. I am indebted to their document "Labour's unfair council tax: the facts"; I think that we are right to rely on the facts. The document contains a question and answer section that includes the question:
  "Will students have to pay?"
  The answer is:
  "Only if they are already paying income tax, e.g. earnings during holidays and so on."
  It is no use trooping through the Lobby to oppose the Government on variable fees while at the same time proposing a measure that will increase student indebtedness.
  Most students do not pay income tax, but it is worth noting the research carried out by NatWest bank, which shows that 53 per cent. of students have a part-time job during term time and 20 per cent. of all students earn more than £100 a week. Many students work full-time during their vacations to top up those earnings. Most student nurses now earn enough to have to pay income tax. In addition, it is estimated that 75 per cent. of them now have to do part-time work to supplement their income while studying, and would therefore have to pay extra in the form of local income tax.
  While pensioners are protesting, and some are even going on strike, it takes the genius of the Liberal Democrats to find a system that would make a significant proportion of them pay more, especially those who have worked hard and saved for security in their retirement. The poorest pensioners receive council tax benefit and do not pay council tax. One fifth of pensioners in Britain are in receipt of that benefit. Seventy-one per cent. of all pensioners receive income from their own investments. That income would be taxed under the Liberal Democrats' proposals. With a local income tax of 3.75 per cent., the average pensioner couple in the top quintile of pensioners would be an extra £563 a year worse off. That is on top of the Liberal Democrats' 50 per cent. income tax band, their regional income tax band, their regional national insurance contribution, their business land tax, their toll tax and their parking tax. It begs the question: is there anything that the Liberal Democrats do not want to tax. The hon. Member for Ludlow (Matthew Green) was unhappy with the Sunday Express, so let us consider the opinion of the Daily Mail, a very fair paper. It commented in January:
  "The Liberal Democrats put forward their own plans for local income tax which would hit the middle classes hardest".
  To be fair, that is a clear and stated aim of their policy. As their leader said on BBC Radio 4's "Today" programme:
  "Middle classes £ should pay more for a better society".
  One aspect of Liberal Democrat policy that I particularly look forward to exploring on the doorstep in my constituency is the commitment to keep resource equalisation through a grant. The level of local tax will therefore still be at the whim of central Government, and the rate of local income tax charged in some localities will be higher. That point was made tellingly by the hon. Member for Manchester, Blackley (Mr. Stringer) in an intervention. It is helpful that the Liberal Democrats have provided confirmation:

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  "It may be that areas which currently have very high council taxes will have a slightly higher local income tax".
  Again, that comes from the Liberal Democrats' document, "Labour's unfair council tax: the facts", so it must be a fact.
  We also have the advantage of the interesting letter from the Minister for Local Government, Regional Governance and Fire. He asks the hon. Member for Kingston and Surbiton a reasonable question:
  "How would the redistribution of funds between areas operate?"
  And he makes the reasonable point that
  "London and the South East currently generate 33 per cent. of total Council Tax revenue but 45 per cent. of total income tax revenue in England".
  The hon. Gentleman made the mistake of replying to that. He says in his letter, at point 7:
  "Inter-regional redistribution would of course be necessary £The exact figures would depend on the final grant system adopted, which would of course be one tailored to a LIT system".
  I can imagine myself on the doorstep. After the usual pleasantries, my script would be, "I'm really sorry that Brentwood's local income tax is going up. But your local Liberal Democrats think that the money would be better spent on services in Bradford." The good folks of the Ongar road will be queuing up with their piggy banks saying, "Please take away our money and give it to Bradford. We've seen the pictures from up there. We know the kind of suffering you had in your early life. Give them the money." I do not think it will be like that.
  Matthew Green: Can the hon. Gentleman name a local tax system that does not have a formula that redistributes money through some sort of grant settlement of some degree? For instance, the standard spending assessment was the formula introduced by the Conservatives to go with council tax, and the Government have now introduced the formula spending share.
  Mr. Pickles: Of course I cannot do that. That is the point. The redistribution system for local income tax would make it worse. Everything must have a redistribution process, but this would not make that redistribution process fairer; it would make it unworkable.
  Mr. Edward Davey: Justify it.
  Mr. Pickles: I will happily justify it with the point that the Minister for Local Government, Regional Governance and Fire made in his letter. It is as plain as a pikestaff, and it is a telling point. I will read it to the hon. Gentleman again. I am sorry if I am embarrassing him by reading out his marvellous work:
  "London and the South East currently generate 33 per cent. of total Council Tax revenue but 45 per cent. of total income tax revenue in England".
  If the hon. Gentleman has not grasped that, it probably explains why the Liberal Democrats tabled the motion.
  Mr. Davey: Will the hon. Gentleman give way?
  Mr. Pickles: Oh dear; all right.
  Mr. Davey: What the hon. Gentleman has not grasped is how the grant system would have to work. If
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  at present the council tax base of any local authority is in the formula, obviously it could not be retained for a local income tax. It would be bizarre in the extreme to include a council tax base in the formula when a local income tax was operating. There would be significant changes in the grant formula, which would override everything that the hon. Gentleman has said.
  Mr. Pickles: With respect, I do not think that it is I who has not grasped the point. It is the hon. Gentleman who needs to grasp this if he wants to hold on to his southern seat: his proposal will more than extend the redistribution from the south of England to the north. In fact, I think I might go on the doorsteps of Kingston and Surbiton to ensure that the hon. Gentleman makes that point.
  Let us set aside for a moment the inconsistencies of local income tax. Let us set aside the extra cost, and set aside the unworkability. The problem with local income tax is that it misses the point. The problem is not so much the form of the tax as the fact that it has risen by 70 per cent. since 1997. We need to examine why that is before we can consider ditching such an easy tax to collect.
  The council tax has become the Government's favourite stealth tax. The Government have enjoyed the headlines about increased public spending without having to fund it directly. Instead, they have indirectly forced councils to fund national Government diktats through the council tax, and through the distorted mirror of its multiplier.
  In opposition, the present Prime Minister promised that he had no plans to increase taxation. Of course we now realise that we should not have taken those words in terms of their ordinary meaning. What we should have done is view the pledge in its totality, to use a fashionable phrase. What the Prime Minister could not get through the front door of income tax he has chosen to introduce through the back door of council tax.
  The Government's abuse of council tax is the clearest indication that it is impossible to increase public expenditure without increasing taxation. The fact that the public now blame the Government for these rises is the clearest possible indication that old Abe Lincoln was right: you cannot fool all the people all the time. Ring-fencing, specific grants and the introduction of passporting have pushed many services directly on to the backs of council tax payers.
  There are six councils in the country that are in a "100 per cent. passporting" position, which means that there is nothing extra for hard-pressed services such as care for the elderly and vulnerable children, or even for day-to-day services such as refuse collection, planning enforcement and environmental controls. Those councils are Richmond upon Thames, East Sussex, Windsor and Maidenhead, Southend-on-Sea, West Sussex and Bromley. All are Conservative controlled except Windsor and Maidenhead, which is controlled by the Liberal Democrats.
  In other councils. passporting covers more than 90 per cent. of grant increases. The Minister for Local Government, Regional Governance and Fire said on Thursday:

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  "Those are real-terms increases that are well above the rate of inflation, and we expect local authorities to work within the finance available to them, and to look for economies in order to deliver value for money and quality services to their residents."—[Official Report, 10 February 2004; Vol. 417, c. 967.]
  That is meaningless when the Government have unbalanced authorities' budgets.
  The Minister for Local Government, Regional Governance and Fire (Mr. Nick Raynsford): Will the hon. Gentleman give way?
  Mr. Pickles: It is a real pleasure to give way to the Minister, fresh from his Committee.
  Mr. Raynsford: When the hon. Gentleman's party was in power, local authorities received grant increases below the rate of inflation but were given a similar exhortation to deliver better services and keep council tax down. If he regards our settlement—a 5.5 per cent. increase in formula grant and a 7.3 per cent. increase in total grant—as inadequate, will he tell us how much more his party would put into local government expenditure to achieve his objectives?
  Mr. Pickles: The Minister knows the answer to that. It is not just a question of money; it is a question of the burdens. It is a question of unbalancing—
  Mr. Davey: The burdens?
  Mr. Pickles: I shall deal with the burdens in a moment. In fact, the list is the one that the hon. Gentleman read out. I know that he feels a little bruised because his figures did not add up.
  The Minister must consider the fact that the council tax has gone up by 70 per cent. since his Government took office, yet nothing like those figures occurred when the Conservatives were in office. He says that he is giving more money to local authorities, but he is increasing the burdens on them, and increasing expenditure by making them do likewise without matching their funds. So from national insurance contributions to the pension tax, the Government have given with one hand and taken away with the other. They have imposed on local councils a purpose and a burden that councils were not intended to carry.
  Let us consider the comprehensive performance assessment and best value. The local government information unit estimates that the annual cost of external inspections of local government is £600 million, and that the indirect cost of inspections, compliance, council staff time and so on is an additional £400 million. For most local authorities, the number of premises to be licensed will increase between five and 10 times, and there will be no additional funding for start-up costs. I raised this issue with the Minister, who offered the pious hope that eventually we will be able to work out a system of charges that will provide recompense. But start-up charges are immediate. Councils have an immediate cash crisis, and these factors will immediately add to that crisis.
  Local authorities had to comply with the Freedom of Information Act 2000 by July 2002, with full openness coming into effect by 2005. [Interruption.] My hon. Friend the Member for Cotswold (Mr. Clifton-Brown)
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  says from a sedentary position that the Minister admitted the other day that there was a problem with licensing, and that is my recollection, too. We should also consider the Homelessness Act 2002, EU environmental directives, the Care Standards Act 2000, the Travel Concessions (Eligibility) Act 2002, e-government targets, the cost of asylum seeker dispersal and care, and emergency and civil contingency planning following 11 September. Moreover, the Criminal Records Bureau increased fees for standard and enhanced disclosures by 142 per cent. in July 2003, at an estimated additional cost to councils of £15 million a year. Bed-blocking fines are costing an estimated £10,000 to £15,000 a week, and there is also the school budget pressures caused by passporting.
  The recent ICM opinion poll that the hon. Member for Kingston and Surbiton quoted was compiled by the Conservative group on the Local Government Association. It is not the first time that the Liberal Democrats have quoted Conservatives in aid of their argument, and this time we are happy to lend them our support. That poll shows that 39 per cent. of the public put the blame on the Government. That is a 10 per cent. increase on last year, and a complete reversal of fortune for all the Minister's efforts. Nobody is buying his argument.
  The independent Audit Commission makes it clear who is to blame. Its report, entitled "Council Tax Increases 2003–04: Why Were They So High?", which was published in December last year, shows that the burdens imposed by central Government have increased local authorities' costs. Page 9 states:
  "National cost pressures taken together account for about £2.3 billion of the total increase in councils' spending of £4.3 billion. In other words slightly more than half the total increase is due to national pay and price inflation, increased national insurance and general population growth".
  It also states:
  "The causes of increased spending by councils included …national policy priorities, such as the requirement to increase funding for schools by the amount determined by government or to meet national waste recycling targets".
  It also refers to the changes in allocation of funding that have hit many councils. It mentions the redistribution from London and the south to the midlands and the north—
  Mr. Raynsford rose—
  Mr. Pickles: Does the Minister want me to give way because he thinks that I am quoting from the wrong passage?
  Mr. Raynsford: If the hon. Gentleman's thesis is right, why does the chairman of the Audit Commission, James Strachan, clearly state that there were
  "a number of factors behind the rises and trying to find a single point of blame is not only counter-productive but also simply not borne out by the evidence."?
  Mr. Pickles: I think that the Audit Commission is ticking off the right hon. Gentleman for all his wild assertions about political control. I am quoting from the Audit Commission's written report, not a press release, and the report dismisses the Government's claim that last year's high rises were due to councils not being up for re-election. It states:

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  "We could find no evidence of a statistically significant relationship between either budget or council tax increases and the length of time until the next council election".
  The right hon. Gentleman's argument therefore collapses. The report also noted that the political control of councils made no difference to the rises and saw the size of the grant as the central factor. That is what it says in the main text of the report, and no one's press release can undermine what the report states.
  In conclusion, council tax has become unpopular because of the abuse of the system and because no one now trusts the fairness of the grant system. The council tax is also unpopular because under Labour it has shot up by 70 per cent. As The Independent put it:
  "The council tax may be unpopular, but the alternatives are worse."
  The message is clear: to restore confidence we must reintroduce fairness into the system, redress the balance of funding and start trusting local government.
  Several hon. Members rose—
  Mr. Deputy Speaker (Sir Alan Haselhurst): Order. Front Benchers' speeches have taken up 104 minutes of the 163 available. In order to allow all the Back Benchers who wish to contribute to the debate to do so, I suggest a self-imposed time limit of about 10 minutes.
  6.1 pm
  Huw Irranca-Davies: May I explain first why a Member of Parliament from Wales such as myself should venture into the debate when the Chamber today is peopled largely—with the notable exception of the hon. Member for Brecon and Radnorshire (Mr. Williams)—with English Members? It is because, as with so many other policies, the repercussions of today's debate, coupled with an Assembly review running alongside the current balance of funding review, will have major repercussions across the border. There are voices of discontent out there—whether it be in Cardiff, Canterbury, Oldham or Ogmore—and people are greatly disconcerted over recent rises in council tax levels. No one in the Chamber should ignore that.
  Sir Robert Smith: I reinforce that point by saying that the same concern extends north of the border to Scotland. If we are to have a major reform in respect of local income tax, it would be more easily done if introduced across the United Kingdom.
  Huw Irranca-Davies: My only proviso would be that, as a great supporter of devolution, I welcome the differential. Sometimes it can be a little annoying, but I welcome the freedom to implement policies differently. As the hon. Gentleman knows, the Treasury has given a massive tranche of funding to Ministers in the National Assembly for Wales to pass on to local authorities.
  The Government have commissioned an ongoing review of council tax to explore future options and, as I mentioned. the Welsh Assembly Government have also considered the matter and are paying close attention to what we are saying in the House today.
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  I commend the Liberal Democrats on their choice of debate today, because council tax has had a massive impact on my constituents. Like many others, my constituency has seen large increases in recent years and many people agree that the position either is, or is rapidly becoming, untenable. Politically, as I have no need to remind my hon. Friends, including those on the Front Bench, our constituents look to us to bring forward carefully crafted proposals, so I ask my Front-Bench colleagues not to rush the proposals, no matter how much the Opposition or the media want us to introduce a hasty policy, which might help Conservative Members to snap up a few political crumbs. Our electors will not thank us for introducing badly thought-out measures.
  All too often the headlines in the right-wing press have singled out one or other Government policy and screamed, "This is Labour's poll tax". In my two years in the House, I must have heard that on at least a dozen occasions already. However, when we talk about the council tax, we are haunted by a spectre of the past —the real, Conservative poll tax. Before us waits the spectre of a possible future—the local income tax. If it is the only source for local government financing, it could well become the next poll tax, as I shall explain. I must say to my right hon. Friend the Minister that, if we fail to reform and renew the existing council tax adequately, we could find that our present policy could mutate before our very eyes into another poll tax.
  I commend the Liberal Democrats on their ability to climb aboard a political bandwagon. It is world class. They have spotted something that is currently unpopular, and come up with an eye-catching, if flawed, idea. They have proceeded to flog that poor horse until it has keeled over.
  I do not blame them. That is the nature of politics in opposition. Labour Members remember our 18 years in opposition, and Liberal Democrat Members have had to live with 100 years in the wilderness.
  Mr. Edward Davey: I have here a piece of paper containing quotations from the general election manifestos produced by Liberal Democrats and our predecessor parties since 1983. Each manifesto contained a proposal for local income tax. That is some bandwagon.
  Huw Irranca-Davies: Despite my warm words, I cannot commend the Liberal Democrats on their blinkered focus on a local income tax. Their proposals resemble a promise to fix up an old house, using a sledgehammer only and ignoring the other tools in the box. There is more danger that a sledgehammer will bring the house down than accomplish any good or complicated repairs. The Liberal Democrats, with their blind allegiance to a single option, could truly be called the house wreckers of local government.
  Mr. Roger Williams: Will not any reform of the council tax merely alleviate the symptoms, and not cure the complaint? The complaint is the unfairness that lies at the heart of the council tax.
  Huw Irranca-Davies: I agree with the hon. Gentleman about unfairness, but I hope that the present exhaustive

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  and thorough review of the balance of funding will produce an analysis based on evidence. Using that analysis, we can make decisions. That is the way to go about things; we should not leap ahead and adopt a policy just because it looks politically attractive. The Liberal Democrat proposal on local income tax can be rendered in two or three words in a little manifesto statement, but I would need to have the evidence before making a decision to move in that direction.
  Matthew Green: If the review is so thorough, why has the Prime Minister ruled out one option before it has even begun—and before the Chartered Institute of Public Finance and Accountancy has given the evidence that it was asked to give? The Prime Minister has ruled out one option, with no regard for the information that is available.
  Huw Irranca-Davies: The hon. Gentleman must be as confused as I am on this matter. I have read statements in the media that flatly contradict his version of events. Some newspapers, and especially the right-wing press, assert that nothing is being ruled out of consideration. It has also been stated—wrongly, but the same point has been raised in this debate—that the Government will bring in a dozen different new taxes. My right hon. Friend the Minister has made it clear that nothing is being ruled out of the review, but that people should not assume that Government policy will use only one of the tools available in the toolbox.
  I want to go back into the mists of time, to February 2003. The Liberal Democrats' alternative Budget promised all voters that the adoption of a local income tax would result in a cut of £100 in council tax bills. That claim was repeated in the party's local election manifesto, entitled "Power to the People"—with its echoes of the Tooting popular front—and in the by-election at Brent, East. It is pretty clear then, that between February and September last year, the Liberal Democrats were offering a very catchy promise of "£100 in your pocket".
  However, a curious trick had taken place by December. That catchy promise of £100 back with every Liberal Democrat vote had shrunk. The right hon. Member for Ross, Skye and Inverness, West (Mr. Kennedy) suggested in The Guardian of 8 December that the amount would be £70. From September to December, the amount fell by £30, yet only two days later his colleague, the hon. Member for Truro and St. Austell (Matthew Taylor), was insisting that it was still £100. However, for the moment, let us stay with the leader of the Lib Dems and the tenner a month shrinkage. If the amount saved continues to decrease by £10 a month, it will be down to no saving at all by the time the balance of funding review reports in the summer. The public will be no worse off, but they will certainly be no better off either.
  One question jumped out at me when I considered the pay-as-you-earn option for local income tax: how do the Liberal Democrats plan to plug the funding gap they will cause by missing out the 500,000 people who do not have a salary but receive dividends? Some of the wealthiest people in the country would be missed out. Has there been a calculation of that lost tax take? How much extra will have to come from those who pay
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  through a PAYE system? If the Liberal Democrats cannot tell us today, will they tell us in the press releases after the debate?
  I refer briefly to an article provided by the Library—I commend the excellent work of the Library staff. It was published in The Observer on 1 February 2004. Part of the headline was "Another Fine Mess" and it was subtitled:
  "If you hate dealing with one tax return a year, consider coping with two."
  Mention was made earlier of the American example. In the article, Brendan Donnelly, a director of the Federal Trust stated that local taxation
  "is infinitely more complicated than people think …There would be so many winners and losers among the public, and many would be distributed in a highly unpredictable way."
  Apart from the over-simplistic platitude that the poor will be better off and the rich will not be, we have failed to get an answer about exactly who the winners and losers will be. If the system will be unpredictable, have the Liberal Democrat policy wonks already come up with an analysis of where the knife will fall? Who will it affect across the UK and, to be parochial, who will it affect in Ogmore? I am still not clear about that and I do not think that Liberal Democrat Members are clear about it either.
  We must actively consider change, but we must not leap prematurely into wholesale changes that could worsen the situation. Despite a real-terms increase of 30 per cent. to local government in England since 1997, and a commensurate transfer of funds to the Welsh Assembly Government, many local authorities have had massive increases in local taxation.
  David Taylor: My hon. Friend is forensically dissecting what remains of the Liberal income tax policy, but does he recognise that the unease to which he referred about council tax rates in Wales, which also exists north of the border, is significantly cushioned by the generosity of the Barnett formula? The formula certainly needs review in parallel with the balance of funding review undertaken by the Chartered Institute of Public Finance and Accountancy. I declare an interest as a member of CIPFA.
  Huw Irranea-Davies: That point alone could fill an entire debate. The complexities of the Barnett formula, especially when we consider proposals for regional assemblies, may not have the beneficial effects in Wales that some Members on the Opposition Benches and some people in the nationalist community claim. We need to treat the matter with great caution.
  The Government were right to set up the balance of funding review in April 2003. My understanding is that no options have been ruled out, but that, at present, nothing has been ruled into Government policy. That is the right way to play it. Based on the evidence, local income tax certainly has a role to play in the debate and it may even have a partial role in the eventual solution, but to pretend that it is the magic bullet fools no one except some headline writers who believe that there can be simple solutions. It is rather like believing in the tooth fairy; it is reassuring, but at some point we need to put away such things.

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  We should let the review get on with its work, and look at some of the proposals, including aspects of local income tax, that are worth considering. I commend the review group for its work—the quality of the research, the extensive consultation that is being carried out and the willingness to explore all options. That is quite contrary to what has been put to us by some Opposition Members today.
  I want to put to the Minister some of the feelings of my local authority—Bridgend county borough council. It dislikes the over-zealous use of ring-fencing, although that is primarily conducted by the Welsh Assembly Government, and it would also welcome the flexibility of a return to non-domestic rates in one form or another—I throw that in for the Minister's consideration. It does not have an appetite for pure local taxation as the prime way forward because it recognises that central Government funding has advantages, not least of which is the equalisation function. For all the criticism of central Government funding, it is the mechanism by which we can ensure that deprived areas and rural areas are adequately rewarded.
  Whatever happens in the review, its very existence is an explicit recognition of the unsatisfactory current situation and, most notably, the seemingly unmanageable regressive element of the council tax system. The criteria are correct, so any alternative system should balance stability for local authorities; predictability of income; sufficiency of resources looking more than one year ahead; allowing local authorities to respond to local circumstances; and variety of income. Relying on one source of income is the way to disaster. I would not rule out elements of the Liberal Democrat policy, but a wholesale transfer to it would be dangerous.
  On the necessity of equalisation, I do not envy those wise people who are trying to juggle the often conflicting criteria, but I applaud their efforts and watch their progress with interest. Earlier, I referred to a well-argued article by Neasa MacEarlean in The Guardian, and its closing statement is apt. It states:
  "If we get a sophisticated debate going in the run-up to the next election, we could end up with a more sensitive tax system that will serve us for decades to come".
  The corollary is that, if this debate is unsophisticated and dabbles in simplicity for the sake of spinnable, winnable headlines, we risk ending up with another poll tax, albeit a local poll tax.
  Whatever the outcome of the review, I urge the Minister to adopt certain principles. We must examine an appropriate measure to devolve powers and funding, but the process must not be wholesale. We need a mix of funding rather than an over-reliance on a single source, equalisation within central funding and minimum standards that guarantee that wayward councils will not revert to slashing services as a response to tighter times. Whatever the solution, it is patently not local taxation. The wise solution is more complex and we must be honest with the electorate and not paint them a mirage of a promised land of low, lovable, local income tax.
  6.18 pm
  Sir Paul Beresford: When I considered this debate, I realised that we would probably have some knowledgeable contributions, particularly on national issues, so I decided to examine the matter from a local perspective.
  My local council is, unsurprisingly, called Mole Valley district council. As with many local councils, particularly in the south-east, it has had considerable difficultly with the size of the council tax, not the method. It was hurt in this round: after the adjustment in the formula, which predominantly went back to the Department for Work and Pensions, the transferred grant was sent through and it received an increase of £14,000, which is about 0.4 per cent. A little bit of Government panic money came down to it—another £25,000—giving it the grand total of a 1.2 per cent. increase.
  Mole Valley council felt fairly sore. Fortunately, although it is under no overall control, the Conservatives and the independents used this year to look for efficiency savings and resisted yet another year of Liberal calls for vast increases in expenditure—many hon. Members will have noted that the Liberals are quick to dispense other people's money. In this case, the Conservatives and independents made some savings and managed to keep the proposed increase down to 5 per cent. The Mole Valley Liberals called every saving a cut and suggested an 18 per cent. rise in council tax. Going by the reaction at the council meeting when the final decision was made, the Liberals complained that the 5 per cent. increase was too much while also complaining about the cuts.
  As many hon. Members have recognised, the council tax has, in the main, worked quite well. I agree with the Government that many authorities have the opportunity to make enormous savings, but many just do not try. For example, why is it that Hammersmith and Fulham's bin collection costs twice as much per head of population as its Conservative neighbour's? That is a little gem of a question that I am sure the Minister of State will think about and have a reply of some sort to when he winds up the debate.
  The Government's contribution to high bills must be acknowledged. It includes the changes in local council procedure and structure, the effective removal of market testing, the huge volume of targets, the number of reviews and reports required by central Government, and the direct controls on the size and direction of spending-just some examples, in addition to those already mentioned. Last year the Minister introduced his new grant system. It was not fair, but as the Minister said to the Office of the Deputy Prime Minister: Housing, Planning and Local Government Committee, it had to involve an element of rough justice. It was certainly rough, but it was a bit short on justice. Many of the needs indices were subjective—as the Minister put it,
  "We had to make choices."
  The Government did make choices, and many were politically motivated. The Committee warned the Government, but the Minister ploughed on. The money moved from the south-east and London to the urban north. The Government denied that that was the effect of their changes, but the Audit Commission—much quoted today—said that it was. Many local authorities.

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  especially in the south, lost huge sums year on year. For example, Surrey lost about £39 million. Around the country, but especially in the south-east, council taxes rose, often by large amounts.
  The Liberal Democrats' proposal is the local tax—their long-term bandwagon. As ever, they claim that it would be fair. They always claim that until one lifts the glossy lid and finds a bin full of expensive problems for local authorities. That is not even to mention the prospect of having local finance directors and councillors examining one's tax declaration. The Liberal Democrat estimate of 3 per cent. is considered by experts to be incorrect: the true figure is probably nearer 6 or 7 per cent.
  The local income tax—like the poll tax, but even more so—would mean technical and administrative problems, and costs would be horrendous. Local authorities would have to locate every taxpayer for collection and keep track of those who moved in each financial year. That would apply even if the tax were collected centrally and dispensed locally. I understand that the Inland Revenue does not have the home addresses of most PAYE taxpayers and only a nominal address for some others. When the Revenue has an address, it is often a taxpayer's home, but it may not be. It may well not be the only home, let alone the main home.
  Mr. Edward Davey: Will the hon. Gentleman give way?
  Sir Paul Beresford: I shall not give way. I am very aware that the opening speeches were especially long, and that my right hon. Friend the Member for North-West Hampshire (Sir George Young) is in his place and desperate to make his speech.
  No consideration has been given to the situation in which, for business or other reasons, earners have two or more residences. If the tax were set at 5 per cent., would an individual with two properties pay 10 per cent. or would the 5 per cent. be split between councils? If so, how would it be split? One wonders. If the tax were collected centrally, the money dispensed by Government would have to be on a per head basis, in which case rural areas would be hard hit, or on a formula basis, which is the source of the present complaints. Any central collection and distribution would effectively remove any real local government autonomy.
  As has been mentioned, because the tax year correction is retrospective, adjustments, either up or down, would cause a large measure of uncertainty. That would mean that local council taxes would have to supplement balances, and reserves would have to be increased considerably. The readjustment would be complicated by each local council having to seek out individuals retrospectively, further adding to administration costs.
  I would be one of the first to recognise some of the problems with the poll tax. I set a zero poll tax twice, and one of the biggest single savings was of the annual £2 million cost of collection. Similar costs, at today's prices, would apply to the Liberal Democrat local tax.
  The Liberal Democrats make great play of local decisions, but only when it suits them. If local councils set their own local tax, the problem of accommodation
  1370
  addresses would arise. It would be interesting to see how many people would appear to move from Lambeth, or Hammersmith and Fulham, to Wandsworth, at least for tax purposes. The local tax idea is fraught with problems and has huge prospects for unfair results. It should not be taken seriously.
  6.24 pm
  Mr. David Borrow: In view of the time, I shall be brief. I should like to make a few general comments on issues around taxation and then specifically on the review of local funding.
  In 1975, I started my career as a local taxation professional, and I declare an interest as a member of the Institute of Revenues, Rating and Valuation.
  In 1976, the Layfield report came out, following the 1973 rating valuation. It raised issues similar to those that we are discussing. The report included all the sorts of issues that are currently being considered; it raised all the problems with local income tax—the nature of raising the money and all the other technical difficulties [Interruption.] If the Liberal Democrats will listen a little longer, I shall deal with certain issues and they may learn a little.
  There is no truly fair tax. All a Government can do is try to put together a basket of taxes on different things in the right combination, in the hope that they can tax enough different things to achieve a fair basket. That means taxing property, wealth, income and expenditure. Those are the main sources of taxation on individuals. The way in which that combination is put together is crucial to whether the tax system is fair.
  Income tax on its own is not fair, because it ignores wealth. It ignores the fact that, if there is only a tax on income, a working couple with kids, paying off a mortgage and struggling with all the expenses of starting out in life, may have a higher income and so pay more income tax, but not be as comfortably off as a wealthy retired couple with a low income, but £200,000 in the bank and their mortgage paid off. We must recognise that fairness in taxation means looking at it as a whole.
  A property tax is essential in any basket of taxes. Because of its very nature—the fact that property does not move—such a tax is easy to collect. Not only in this country, but in many others across the world, it is seen as ideally suited for a local government tax, rather than a national Government tax. That is one reason why, whatever comes out of the review, a local property tax needs to be part of the system that we end up with. Whether it is the only local tax is a different matter, but it needs to be a part.
  The existing council tax is unfair, because the bandings are not sufficient. There should be more bands at the top and the bottom. That can be dealt with when the revaluation takes place. We also need to ensure a proper balance between the different bands. At present, those in a low band pay more than they should, and those in a high band pay less than they should, taking the value of the property alone. There is quite a lot of scope to improve the existing system.
  If we look at local government funding as a whole, we see that the reason for the current problem with council tax increases is the gearing system, which means that 75 to 80 per cent. of local government income is dependent

  1371
  on the decisions of central Government. Of that chunk, about a quarter to a third is geared to the nationalised business rate, which is linked to inflation, and the remainder comes as Government grant. So the only bit that councils have any control over is the 20 to 25 per cent. That percentage is higher than it was 10 years ago, but it is a small percentage linked to the council tax. Replacing the council tax with a local income tax would not change that problem, because councils could still control only a small proportion of council income.
  We need to increase local government's tax base. We need to look again at the localisation of the business rate and restore that to local authorities. One of the matters that Layfield looked at in 1976 was whether it was possible to introduce other forms of local tax in addition to the property tax.
  Local income tax may be a possibility, but my view is that it would be complicated and difficult to introduce because of the existing structure of local government, with small shire districts of about 100,000 people such as those that I represent and the two-tier system. Local income tax is possible with a regional system or with much larger local authorities, as in the United States, where local income tax seems to work better.
  I was reminded of my hon. Friend the Minister's constituency—Corby—when comments were made about the buoyancy of local income tax. Local income tax is all right when the economy is booming, living standards are increasing and income tax yield is going up every year. However, 10 or 15 years ago, when the steel industry collapsed in Corby and the town struggled for a number of years, those who were running the local authority had to try to deliver all the services although its tax base—the workers—was wiped out at a stroke. To an extent, that happened in my own authority, when Leyland Trucks got into difficulty in the early 1990s. If local income tax is the only tax that local authorities control, they are vulnerable to the ups and downs not just of the national economy but of the local economy. The smaller the local authority, the more vulnerable it is to those changes.
  The Liberals need to think again about their policy. I can understand why it is viewed as sexy and the sort of thing that goes into "Focus" across the country, but people move away from it when they consider it. If the Liberals seriously felt that they had a chance of winning the next election, that commitment would disappear from their policy by the time the manifesto was written.
  6.31 pm
  Sir George Young: It is pleasure to follow my hon. Friend the Member for Mole Valley (Sir Paul Beresford) and the hon. Member for South Ribble (Mr. Borrow), who have spoken with authority and brevity, and I will certainly seek to match them on brevity.
  The Liberal Democrats, who have made this proposal, need to stand back and look at the overall structure of taxation. There are taxes on income, on expenditure and on capital or assets. They propose to abolish a tax on capital or assets—council tax is almost exclusively a tax on home ownership—and to replace it with a tax on income. They assert that that will be fairer, but I remain to be convinced.
  1372
  A number of residential properties in my constituency are owned by companies or trusts and a substantial amount of council tax is levied on them at the moment. That could be lost, to be made good by a rise in income tax on the average punter. Other substantial properties are owned not by companies, but by individuals who are not domiciled in this country and may legitimately pay no tax in the UK. Their contribution would also be lost. Finally, some properties are owned by wealthy individuals who are domiciled in this country but have so arranged their affairs to make ingenious use of tax allowances that they pay little or no income tax. They live off their capital, and I am sure that they will be interested in the Liberal Democrat proposal to reduce their tax burden at the expense of those who are less well off.
  I have looked at the website, and the Liberal Democrats make it clear that they want to abolish the council tax and replace it by Inland Revenue and pay-as-you-earn measures. That would not capture a range of people, and that lost income would have to be made good. So some arguments of principle need to be addressed before reducing taxes on capital and replacing them with taxes on income, and there are some important practical and distributional consequences, as well as possibly an impact on incentives. If 3p in the pound were added to the basic rate of income tax, it would help to make this country less competitive internationally and add to the incentive to take tax avoidance measures. I do not put too much emphasis on this, but related to that is the view of some economists that house prices will rise if a tax on houses is abolished. The Government have tried to damp down buoyancy in house prices by using stamp duty. It follows that, if the tax on houses is reduced, prices may go up, with consequences for marginal first-time buyers.
  I have considered the impact of the proposals on my constituency. At the moment, the average council tax bill in Test Valley is £1,042 a year. To raise the same amount of money would require a local income tax of 4.3 per cent., yet a household with one person on average male earnings and another on average female earnings would end up paying a yearly local income tax bill of £1,670; so having got rid of the council tax, that couple would pay £628 a year more. I know that the Liberal Democrats keep saying, "We expect 70 per cent. of households to be better off", but I remember my Government saying that about the poll tax. The reality is that it is not households who vote, but voters. I do not believe that 70 per cent. of my constituents would be better off.
  I shall touch on one or two specific issues in the time available. Let me start with what I call visibility. How visible would the new tax be? At the moment, I receive a bill in April from Test Valley borough council setting out how much I must pay. I have a standing order for 10 months, which I see on my statement, so I know exactly how much money has gone where. That keeps me focused on the cost of local government and allows me to compare my band with those in other local authorities. Under one of the Liberal Democrat proposals, there would simply be less visibility. A flat sum would be deducted from my pay each month, along with my national income tax, national insurance, contributions to the Members' fund, give-as-you-earn, and all the rest. The tax would be less visible, which

  1373
  would reduce the accountability of local government and the transparency of its costs. It would get lost in my transactions with central Government, instead of being a stand-alone transaction with local government. There would be a complicated settling-up process at the end of the year, although which tax year's return would be used as the basis for the settling up is not quite clear.
  There is a further point that has not been mentioned in the debate. How would my town hall know what the tax base would be when setting the rate at the beginning of the year? At the moment, it knows with some certainty how much in the pound a certain amount of council tax will raise—it has a fixed, immovable tax base. Under the Liberal Democrat proposal, it would not know how much it would raise from a specific rate of tax. I suspect that councils would aim high so that they would have a margin.
  What percentage of the tax would be collected? Some 96 per cent. of council tax is collected at present. Do the Liberal Democrats really think that local authorities would get the same return from central Government?
  Mr. Edward Davey: Will the right hon. Gentleman give way?
  Sir George Young: I shall, but the time will come out of the hon. Gentleman's colleague's winding-up speech.
  Mr. Davey: As in other countries, the Inland Revenue would tell local authorities their income tax bases at the beginning of the year and guarantee that from the Exchequer.
  Sir George Young: But how would the Inland Revenue know whether I would stay in that area for the whole year? How would it know what my income would be? The Inland Revenue might have an idea about how much I will earn in the current year, but I have to tell the hon. Gentleman that it is quite often wrong. Under his proposal, the tax would not have the same fixed base on which it could be levied as the council tax. I listened attentively to his opening speech, but he did not begin to address that point. Under the system, there would be questions of where I lived and whether I would have to pay twice. At the moment, the Inland Revenue is relatively relaxed about the address from which I send off my tax return, as long as it gets one. Under the new system, it would be vital that the address was right.
  The hon. Gentleman said that an advantage of his proposal was that it would provide a buoyant source of revenue. I am not sure that I want local government to have a buoyant source of revenue. [HON. MEMBERS: "Ah!"] No, I want authorities to have a threshold through which they must go each year before they put up the council tax. I want them to justify their increases year in, year out. The hon. Gentleman wants local government to have a buoyant source of tax revenue so that it does not have to answer the difficult questions that are asked at the moment. I consider what the Liberal Democrats see as an advantage to be a disadvantage.
  The real problem at the moment is that too much weight is put on the council tax. It was invented some 14 years ago when the average amount paid was around £500. It could bear that amount of traffic without too
  1374
  much damage to its structure—it is like a bridge with a weight restriction. However, many of my constituents are now paying four-figure, not three-figure, amounts.
  The hon. Member for Kingston and Surbiton (Mr. Davey) asked at the start of his speech what could be done. I would keep the council tax and complement it with another tax, perhaps a variable vehicle excise duty, for the sake of argument. That would be a much better response to the challenges facing local government than those that he proposed. The debate has shown that the House does not want to axe the tax; it wants to axe the Liberal Democrats.
  6.39 pm
  Matthew Green: This debate has shown that if the arguments used by Conservative and Government Members are the best that they can throw at us, we are on fairly firm ground. As to the comments by the Under-Secretary about the date of this debate, that was not in the gift of Liberal Democrats. I am sorry that the Minister for Local Government, Regional Governance and Fire could not be present for the start of the debate because he was in Committee. Originally, our Opposition day was Wednesday, but, quite rightly, it was moved because of the Hutton report. The Minister can make cheap jibes, but this debate was originally intended for the day on which the Hutton report was published.
  The hon. Member for Brentwood and Ongar (Mr. Pickles) and others used as a theme how much a working couple would pay under our proposals and those of the Conservatives. Two weeks ago, one of my excellent local newspapers, the Ludlow Journal, published an article about a young couple named Charlotte and Scott Downes from Burford. Charlotte is 24 and Scott is 30. They both work and have a four-year-old daughter. They went to the press from choice—that was not down to me. The paper reported:
  "Mrs. Downes said she and her husband were a couple who worked to pay their own way and didn't expect others to do it for them. 'We support ourselves but I can work only 20 hours a week and get £4.50 an hour. Scott works full time and gets just £5 an hour'."
  Such wage levels are common in my constituency. Charlotte Downes went on to say:
  "We have to pay around £3,500 a year in rent and we have to clothe and feed themselves. We don't get 10 and 20 per cent. increases in what we earn but that is the sort of increases we have been getting in Council Tax over recent years. We are already paying over £1,200 a year in Council Tax"—
  presumably under band D—
  "and now it's set to go up yet again."
  As well as asking their permission to quote them, I did some calculations. On the basis of those figures, that couple's joint income is just over £16,000 a year, which is quite common in my constituency and puts them above council tax benefit levels. Currently, they pay £1,200—a hell of a chunk out of £16,000, on top of the other taxes that couple have to pay and their cost of living.
  If we scrapped council tax and implemented our proposed local income tax bands with a national average of 3.75 per cent., that couple's local income tax bill as a household would be £260. They would be £900 a year better off than under the current proposals that are being defended. According to the information

  1375
  revealed by the right hon. Member for West Dorset (Mr. Letwin), under the Conservatives, the Downeses would pay £2,400 council tax. On the assumption that that was done by cutting national income tax—I will not claim that the Tories would increase the burden of taxation nationally—by 3.75 per cent across the bands, that would save the Downeses £260. Overall, they would be £900 a year worse off under the Conservative proposals–unless the Tories have another policy that they have not yet revealed. We would love to know.
  At the other end of the scale, the local Member of Parliament—myself—earns £55,000 a year.
  Mr. Hoyle: No, £56,000.
  Matthew Green: I will work on £55,000 as a round figure.
  My current council tax for my band E property is £1,400 a year. Under my party's proposals, I would pay local income tax on just over £50,000 of my income, taking the personal allowance into account, but council tax would be scrapped. My local income tax bill would be £1,900 but I would save £1,400 in council tax, so I would pay £500 more. I think that I should. Under the Conservative plans outlined by the right hon. Member for West Dorset, I would pay council tax of £2,800 but save £1,900 on my income tax bill, so I would be £500 better off under the Tories' current plans. I say that I should pay more and that the young working couple from Burford should pay less. Conservative proposals would reverse that. The Government may be trying to come up with new proposals, but they are going nowhere fast.
  In the short time available, I shall tackle a few points that were made in our debate. The Minister cited some countries that used local income tax. He needs to go back to his officials because he did not mention Switzerland or Norway, both of which use local income tax, as do many other countries. He should ask his officials to take another look at countries that use such a system—Switzerland certainly does so. The hon. Member for Ogmore (Huw Irranca-Davies) made some well-argued points. He clearly favours a hybrid system, but the danger of that is that the cost of collection is likely to be greater. Council tax raises £19 billion a year, 4 per cent. of which—about £670 million—is the cost of collecting and administering benefits. If we added another tax system on top, it would be hard to escape the conclusion that administration costs would be higher. One or two other Labour Members found a hybrid system attractive, but they must consider how those administration costs would be met. More would be spent on bureaucracy, so the return would be smaller.
  The hon. Member for Mole Valley (Sir Paul Beresford) said that local income tax would not be levied at 3.75 per cent. of earnings, but at 6 to 7 per cent. The figure of 3.75 per cent. is based on the local income tax rate for earnings between £5,000—the personal allowance—and £100,000, where we would set a cap. The figure of 3.75 per cent. is not just based on the standard rate. If the tax were based on that rate, 6 or 7 per cent would be a possible figure. However, because the tax is levied across the board, the figure is 3.75 per cent. We must therefore be careful to specify what portion of income the tax is based on.
  1376
  The hon. Member for South Ribble (Mr. Borrow) mentioned the Layfield commission, and we got excited because we thought that he was going to tell us what its conclusion was. However, he swallowed his words and could not bring himself to say what it was. The Layfield commission pointed out that local income tax is not perfect—every tax has pros and cons—but it recommended it after assessing a range of local taxes. The hon. Gentleman could not bring himself to say that the Layfield commission recommended local income tax. He talked about buoyancy, and gave Corby as an example of a local community where our proposals would have a disastrous impact. At the moment, people without income receive council tax benefit and extra money from the Government kicks in. However, revenues can be affected if something happens that has a major impact on an area. I hope that that does not happen to communities, but if it does the authorities step in. I think that something similar would happen if a local tax system were introduced.
  The right hon. Member for North-West Hampshire (Sir George Young) asked what we would do with a property owned by a business rather than an individual. That is a fair point—we would tax the owners as businesses, which would either pay uniform business rate or our replacement for UBR, details of which I shall not go into.
  Sir George Young: How does the hon. Gentleman know which properties are involved?
  Matthew Green: We would know at which property someone was registered for income tax purposes—[Interruption.] I am being reminded that capital gains tax exemption is another way of finding out.
  Our debate has shown that the Tories are in denial. Council tax is an unfair tax—we cannot escape that conclusion. Labour Members have admitted that council tax is inherently unfair. The Conservatives introduced one unfair tax—the poll tax—only to replace it with an equally unfair tax. It is time for the unfair council tax to be scrapped and replaced with a tax that is based on ability to pay and is fair to the people who are paying it.
  6.49 pm
  The Minister for Local Government, Regional Governance and Fire (Mr. Nick Raynsford): I apologise for having been unable to attend the start of this important debate. As my hon. Friend the Under-Secretary explained, it has been difficult for us to cover this debate as well as the Committee on the Fire and Rescue Services Bill. However, I listened to all the points that hon. Members have made since my arrival. I shall respond to those, but I must first repeat some of the points made by my hon. Friend the Under-Secretary, because they are crucial, and the message seems not to be getting through in some quarters.
  This Government have given continuing year-on-year increases in grant to local government, now totalling £46.1 billion—30 per cent. more in real terms than the figure that we inherited in 1997. This year, we increased formula grant by 5.5 per cent. and total grant by 7.3 per cent—that includes specific and special grants. That represents a sustained growth of investment in our

  1377
  public services, in stark contrast to the 7 per cent. real-terms cuts that applied between 1993 and 1997. I must also emphasise that those increases in grant have benefited all authorities, irrespective of political control—contrary to the impression that the right hon. Member for Skipton and Ripon (Mr. Curry) tried to convey last week, when, presumably prompted by Conservative central office, he uncharacteristically lapsed into the use of wholly spurious and bogus statistics. Conservative-controlled councils received on average slightly larger grant increases this year than Labour authorities—6.2 per cent. as against 5.9 per cent.—[Interruption.] My hon. Friends may not be happy about that, but it is important to put the record straight. Yet despite that, Conservative councils are threatening large council tax increases that will punish their unfortunate council tax payers. If the example of Conservative-controlled councils is bad enough, wait until we get to those that are under the control or influence of the Liberal Democrats, who seem to think that the sky is the limit for council tax rises.
  There is absolutely no justification for unreasonably large council tax increases, given the generous Government grant increases that all authorities received this year. We have not only increased grant, but extended freedoms for local authorities, reversing the trend on ring-fencing—a point raised by my hon. Friend the Member for Ogmore (Huw Irranca-Davies). In the recent grant settlement, we unfenced £750 million-worth of grant—hardly a centralist measure—and the Local Government Act 2003, to which he also referred, contained several important freedoms for authorities, especially the new borrowing system and the rights to trade, to charge and to vary discounts.
  Mr. Pickles: Will the Minister give way?
  Mr. Raynsford: Very briefly, but the hon. Gentleman will know that my time is limited.
  Mr. Pickles: The hon. Member for Ogmore (Huw Irranca-Davies) was kind enough to acknowledge that the level of ring-fencing is now roughly three times the rate that the Government inherited. Will the Minister confirm that?
  Mr. Raynsford: I will confirm that the trend in ring-fencing is going down—it has gone down to 11 per cent. from 13 per cent. last year, and we are on target to reduce it, as we pledged, to below 10 per cent. next year.
  Given the good grant increases and the additional freedoms, there is no excuse for unreasonable council tax increases. That is why we have made it clear that if necessary we will use our capping powers. The public are unhappy about the unreasonably large council tax increases of recent years, and we share their concern. We will not stand aside or duck the issue when councils levy, year on year, continued unsustainable increases in council tax. Given the generous grant settlement for 2004–05 and the scope for efficiency improvements, our view is that local authorities can and should deliver council tax increases in low single figures.
  1378
  I have already written to 65 authorities to express concern at reported increases in excess of 5 per cent., and I am pleased to say that many have written back to me to make clear their intention to restrict increases to low single figures. Some indicated that the press reports about larger increases were incorrect; others have clearly acted to bring down their originally higher estimates. That is very welcome. Some, however, have not, and I therefore plan to call in some authorities that did not provide satisfactory replies. We would much prefer not to use our capping powers, but it appears inevitable that we will have to do so this year.
  Let me consider the points that were made in the debate. The hon. Member for Brentwood and Ongar (Mr. Pickles) gave us an amusing tour of Liberal Democrat operations, but he was painfully silent about the Conservative alternative. That is a comment on the party of the poll tax. Perhaps on this occasion he is showing some discretion.
  My hon. Friend the Member for Ogmore highlighted the complexity of local government finance and issued a warning about the unpredictable consequences of major changes such as the Liberal Democrats' local income tax. I entirely agree with him.
  The hon. Member for Mole Valley (Sir Paul Beresford) claimed that the new grant system redistributes grant from the south to the north. I have some figures for him and I hope that he will listen because allegations of skewed allocation of grant are unfounded. The figures are averages for whole regions, not selective figures for individual councils, and they show the change in grant in 2004—05, compared with 2003—04. In the south-west, the average increase is 5.5 per cent.; in the south-east it is 5.6 per cent., and in London it is 5.4 per cent. That compares with a national average of 5.5 per cent.
  Let us consider the increases in the three northern regions. In Yorkshire and the Humber it is 5.0 per cent.; in the north-east it is 4.8 per cent., and in the north-west it is 5.2 per cent. [Interruption.] I understand that some of my hon. Friends from northern regions are not happy with that, but I hope that the figures make it clear that there is no question of a shift in grant from the south to the north, as our political opponents allege.
  My hon. Friend the Member for South Ribble (Mr. Borrow), who is an expert on the matter, highlighted the complexity of local taxation and the unfairness of simply taxing income. He emphasised that fairness requires a balance between different tax sources, including a property tax.
  The right hon. Member for North-West Hampshire (Sir George Young) made a telling point about the impact of tax changes. He highlighted the Liberal Democrats' claim that 70 per cent. would be better off under local income tax and reminded hon. Members that the Conservative Government in which he served had promised the same of the poll tax. Not surprisingly, we all laughed.
  The hon. Member for Ludlow (Matthew Green), who replied for the Liberal Democrats, alleged that the Government were going nowhere fast. He is wrong on both counts. We are not going fast because rushing into change is a recipe for disaster. indeed, it led to the poll tax. The Liberal Democrats are in danger of rushing into change. We are going somewhere and considering the

  1379
  issues carefully. We do not adopt the Liberal Democrats' approach. The only adage that I shall cite, with all modesty, is "Fools rush in". We do not intend to do that.
  The focus of the debate has been the Liberal Democrats' proposal for a local income tax. They propose nothing less than the wholesale abolition of a property tax and its replacement with a local income tax, which local councils set at whatever level they believe that they need. As the Liberal Democrats put it, "Axe the tax" and "Scrap the cap". However, two slogans do not add up to a working local government finance system. If we did as the Liberal Democrats suggested, it would make us one of only a tiny number of countries in the world that have no property tax at all.
  Local income tax would be a major departure and we need to examine its practicalities and implications carefully. The balance of funding review will do just that in early March when the Chartered Institute of Public Finance and Accountancy gives a presentation on the issue. However, the Liberal Democrats have been much more cavalier in their approach, brushing aside any voices that urge caution in their rush to produce a new slogan.
  As anyone who has studied the complex subject of local government finance will testify, there are no quick and easy fixes. Those who pretend that there are simple and painless solutions—"Axe the tax"—are no more than peddlers of fantasies, snake oil salesmen who claim to offer a cheap and cheerful remedy.
  We have given councils sustained, above-inflation increases in grant and more freedom from ring-fencing. We expect councils to budget prudently for low council tax increases. The public deserve nothing less. If they do not do so, we will have no option but to cap those councils that have imposed unreasonable council tax increases on their tax payers. In the longer term, we need to create a workable, widely accepted system. We are doing that by working through the balance of—
  Mr. Andrew Stunell rose in his place and claimed to move, That the Question be now put.
  Question, That the Question be now put, put and agreed to.
  Question put, That the original words stand part of the Question:—
  The House divided: Ayes 53. Noes 435.

  Division No. 51]

  [6:59 pm

  AYES

  Allan, Richard

  Davey, Edward (Kingston)

  Baker, Norman

  Doughty, Sue

  Barrett, John

  Ewing, Annabelle

  Beith, rh A. J.

  Foster, Don (Bath)

  Brake, Tom (Carshalton)

  George, Andrew (St. Ives)

  Breed, Colin

  Gidley, Sandra

  Brooke, Mrs Annette L.

  Green, Matthew (Ludlow)

  Bruce, Malcolm

  Hancock, Mike

  Burnett, John

  Hermon, Lady

  Cable, Dr. Vincent

  Holmes, Paul

  Calton, Mrs Patsy

  Hughes, Simon (Southwark N)

  Campbell, rh Sir Menzies (NE Fife)

  Keetch, Paul

  Kennedy, rh Charles (Ross Skye & Inverness)

  Carmichael, Alistair

  Cotter, Brian

  Kirkwood, Sir Archy

  1380

  Lamb, Norman

  Stunell, Andrew

  Laws, David (Yeovil)

  Taylor, Matthew (Truro)

  Llwyd, Elfyn

  Teather, Sarah

  Marsden, Paul (Shrewsbury & Atcham)

  Thomas, Simon (Ceredigion)

  Thurso, John

  Oaten, Mark (Winchester)

  Tyler, Paul (N Cornwall)

  Öpik, Lembit

  Weir, Michael

  Price Adam (E Carmarthen & Dinefwr)

  Williams, Hywel (Caernarfon)

  Williams, Roger (Brecon)

  Pugh, Dr. John

  Willis, Phil

  Rendel, David

  Wishart, Pete

  Robertson, Angus (Moray)

  Younger-Ross, Richard

  Russell, Bob (Colchester)

  Tellers for the Ayes:

  Salmond, Alex

  Mr. Alan Reid and

  Sanders, Adrian

  Sir Robert Smith

  NOES

  Abbott, Ms Diane

  Caborn, rh Richard

  Adams, Irene (Paisley N)

  Cairns, David

  Ainger, Nick

  Campbell, Alan (Tynemouth)

  Ainsworth, Bob (Cov'try NE)

  Campbell, Mrs Anne (C'bridge)

  Ainsworth, Peter (E Surrey)

  Campbell, Gregory (E Lond'y)

  Alexander, Douglas

  Campbell, Ronnie (Blyth V)

  Allen, Graham

  Caplin, Ivor

  Ancram, rh Michael

  Casale, Roger

  Anderson, Janet (Rossendale & Darwen)

  Cash, William

  Caton, Martin

  Arbuthnot, rh James

  Cawsey, Ian (Brigg)

  Armstrong, rh Ms Hilary

  Challen, Colin

  Atherton, Ms Candy

  Chapman, Ben (Wirral S)

  Atkins, Charlotte

  Chapman, Sir Sydney (Chipping Barnet)

  Atkinson, David (Bour'mth E)

  Atkinson, Peter (Hexham)

  Chaytor, David

  Bacon, Richard

  Chope, Christopher

  Baird, Vera

  Clapham, Michael

  Baldry, Tony

  Clappison, James

  Banks, Tony

  Clark, Mrs Helen (Peterborough)

  Barker, Gregory

  Clark, Dr. Lynda (Edinburgh Pentlands)

  Barnes, Harry

  Baron, John (Billericay)

  Clark, Paul (Gillingham)

  Barron, rh Kevin

  Clarke, rh Charles (Norwich S)

  Battle, John

  Clarke, rh Kenneth (Rushcliffe)

  Bayley, Hugh

  Clarke, rh Tom (Coatbridge & Chryston)

  Beard, Nigel

  Begg, Miss Anne

  Clelland, David

  Bellingham, Henry

  Clifton-Brown, Geoffrey

  Bennett, Andrew

  Clwyd, Ann (Cynon V)

  Bercow, John

  Coaker, Vernon

  Beresford, Sir Paul

  Coffey, Ms Ann

  Berry, Roger

  Cohen, Harry

  Best, Harold

  Colman, Tony

  Betts, Clive

  Connarty, Michael

  Blears, Ms Hazel

  Conway, Derek

  Blizzard, Bob

  Cook, rh Robin (Livingston)

  Blunkett, rh David

  Cooper, Yvette

  Boateng, rh Paul

  Corbyn, Jeremy

  Borrow, David

  Corston, Jean

  Boswell, Tim

  Cousins, Jim

  Bradley, Peter (The Wrekin)

  Cranston, Ross

  Bradshaw, Ben

  Cruddas, Jon

  Brady, Graham

  Cryer, Ann (Keighley)

  Brazier, Julian

  Cryer, John (Hornchurch)

  Brennan, Kevin

  Cummings, John

  Brown, Russell (Dumfries)

  Cunningham, rh Dr. Jack (Copeland)

  Browne, Desmond

  Browning, Mrs Angela

  Cunningham, Jim (Coventry S)

  Bryant, Chris

  Cunningham, Tony (Workington)

  Buck, Ms Karen

  Curtis-Thomas, Mrs Claire

  Burden, Richard

  Dalyell, Tam

  Burgon, Colin

  Darling, rh Alistair

  Burnham, Andy

  Davey, Valerie (Bristol W)

  Burnside, David

  David, Wayne

  Burt, Alistair

  Davies, rh Denzil (Llanelli)

  Butterfill, Sir John

  Davies, Geraint (Croydon C)

  Byers, rh Stephen

  1381

  Davies, Quentin (Grantham & Stamford)

  Heathcoat-Amory, rh David

  Henderson, Doug (Newcastle N)

  Davis, rh David (Haltemprice & Howden)

  Henderson, Ivan (Harwich)

  Hendrick, Mark

  Dawson, Hilton

  Hendry, Charles

  Dean, Mrs Janet

  Hepburn, Stephen

  Denham, rh John

  Heppell, John

  Dhanda, Parmjit

  Hesford, Stephen

  Dismore, Andrew

  Heyes, David

  Djanogly, Jonathan

  Hill, Keith (Streatham)

  Dobbin, Jim (Heywood)

  Hoey, Kate (Vauxhall)

  Dobson, rh Frank

  Hood, Jimmy (Clydesdale)

  Donaldson, Jeffrey M.

  Hoon, rh Geoffrey

  Donohoe, Brian H.

  Hope, Phil (Corby)

  Doran, Frank

  Hopkins, Kelvin

  Dorrell, rh Stephen

  Horam, John (Orpington)

  Dowd, Jim (Lewisham W)

  Howard, rh Michael

  Drew, David (Stroud)

  Howarth, rh Alan (Newport E)

  Duncan, Alan (Rutland)

  Howarth, George (Knowsley N & Sefton E)

  Duncan, Peter (Galloway)

  Duncan Smith, rh lain

  Hoyle, Lindsay

  Dunwoody, Mrs Gwyneth

  Hughes, Beverley (Stretford & Urmston)

  Eagle, Maria (L'pool Garston)

  Edwards, Huw

  Hughes, Kevin (Doncaster N)

  Efford, Clive

  Humble, Mrs Joan

  Ellman, Mrs Louise

  Hunter, Andrew

  Ennis, Jeff (Barnsley E)

  Hurst, Alan (Braintree)

  Evans, Nigel

  Iddon, Dr. Brian

  Farrelly, Paul

  Ingram, rh Adam

  Field, rh Frank (Birkenhead)

  Irranca-Davies, Huw

  Field, Mark (Cities of London & Westminster)

  Jack, rh Michael

  Jackson, Helen (Hillsborough)

  Fitzpatrick, Jim

  Jackson, Robert (Wantage)

  Fitzsimons, Mrs Lorna

  Jamieson, David

  Flight, Howard

  Jenkin, Bernard

  Flint, Caroline

  Jenkins, Brian

  Flook, Adrian

  Johnson, Alan (Hull W)

  Follett, Barbara

  Jones, Helen (Warrington N)

  Forth, rh Eric

  Jones, Lynne (Selly Oak)

  Foster, Michael (Worcester)

  Jones, Martyn (Clwyd S)

  Foster, Michael Jabez (Hastings & Rye)

  Joyce, Eric (Falkirk W)

  Kaufman, rh Gerald

  Foulkes, rh George

  Keen, Alan (Feltham)

  Francis, Dr. Hywel

  Keen, Ann (Brentford)

  Francois, Mark

  Kennedy, Jane (Wavertree)

  Gale, Roger (N Thanet)

  Key, Robert (Salisbury)

  Gardiner, Barry

  Kidney, David

  Garnier, Edward

  Kilfoyle, Peter

  Gerrard, Neil

  King, Andy (Rugby)

  Gibb, Nick (Bognor Regis)

  Kirkbride, Miss Julie

  Gibson, Dr. Ian

  Knight, rh Greg (E Yorkshire)

  Gillan, Mrs Cheryl

  Knight, Jim (S Dorset)

  Gilroy, Linda

  Kumar, Dr. Ashok

  Godsiff, Roger

  Ladyman, Dr. Stephen

  Goggins, Paul

  Laing, Mrs Eleanor

  Goodman, Paul

  Lait, Mrs Jacqui

  Gray, James (N Wilts)

  Laxton, Bob (Derby N)

  Grayling, Chris

  Lazarowicz, Mark

  Green, Damian (Ashford)

  Lepper, David

  Griffiths, Jane (Reading E)

  Leslie, Christopher

  Griffiths, Nigel (Edinburgh S)

  Letwin, rh Oliver

  Griffiths, Win (Bridgend)

  Levitt, Tom (High Peak)

  Grogan, John

  Lewis, Ivan (Bury S)

  Gummer, rh John

  Lewis, Dr. Julian (New Forest E)

  Hague, rh William

  Liddell, rh Mrs Helen

  Hall, Mike (Weaver Vale)

  Liddell-Grainger, Ian

  Hall, Patrick (Bedford)

  Lidington, David

  Hamilton, David (Midlothian)

  Lilley, rh Peter

  Hammond, Philip

  Linton, Martin

  Hanson, David

  Lloyd, Tony (Manchester C)

  Harman, rh Ms Harriet

  Loughton, Tim

  Harris, Tom (Glasgow Cathcart)

  Love, Andrew

  Hawkins, Nick

  Lucas, Ian (Wrexham)

  Hayes, John (S Holland)

  Luff, Peter (M-Worcs)

  Heald, Oliver

  Luke, lain (Dundee E)

  Healey, John

  Lyons, John (Strathke/vin)

  1382

  McAvoy, Thomas

  Raynsford, rh Nick

  McCabe, Stephen

  Redwood, rh John

  McCafferty, Chris

  Reed, Andy (Loughborough)

  MacDonald, Calum

  Reid, rh Dr. John (Hamilton N & Bellshill)

  McDonnell, John

  MacDougall, John

  Robathan, Andrew

  McFall, John

  Robertson, John (Glasgow Anniesland)

  McGuire, Mrs Anne

  McIntosh, Miss Anne

  Robertson, Laurence (Tewk'b'ry)

  McIsaac, Shona

  Robinson, Geoffrey (Coventry NW)

  Mackay, rh Andrew

  McKechin, Ann

  Robinson, Mrs Iris (Strangford)

  McKenna, Rosemary

  Roche, Mrs Barbara

  Mackinlay, Andrew

  Rooney, Terry

  Maclean, rh David

  Rosindell, Andrew

  McLoughlin, Patrick

  Roy, Frank (Motherwell)

  McNamara, Kevin

  Ruane, Chris

  McNulty, Tony

  Ruddock, Joan

  Mactaggart, Fiona

  Salter, Martin

  McWalter, Tony

  Sarwar, Mohammad

  Mahmood, Khalid

  Savidge, Malcolm

  Mahon, Mrs Alice

  Sawford, Phil

  Mandelson, rh Peter

  Sedgemore, Brian

  Mann, John (Bassetlaw)

  Selous, Andrew

  Maples, John

  Shaw, Jonathan

  Marris, Rob (Wolverh'ton SW)

  Sheerman, Barry

  Marsden, Gordon (Blackpool S)

  Shepherd, Richard

  Marshall, Jim (Leicester S)

  Short, rh Clare

  Martlew, Eric

  Simmonds, Mark

  Mawhinney, rh Sir Brian

  Simpson, Alan (Nottingham S)

  May Mrs Theresa

  Skinner, Dennis

  Merron, Gillian

  Smith rh Andrew (Oxford E)

  Michael, rh Alun

  Smith, Angela (Basildon)

  Miliband, David

  Smith, rh Chris (Islington S & Finsbury)

  Miller, Andrew

  Smith, Geraldine (Morecambe & Lunesdale)

  Mitchell, Andrew (Sutton coldfield)

  Smith, Jacqui (Redditch)

  Mitchell, Austin (Gt Grimsby)

  Smith, John (Glamorgan)

  Mole, Chris

  Smith, John (Glamorgan)

  Moonie, Dr. Lewis

  Smith, Llew (Blaenau Gwent)

  Moran, Margaret

  Spelman, Mrs Caroline

  Moss, Malcolm

  Spicer, Sir Michael

  Mountford, Kali

  Spink, Bob (Castle Point)

  Munn, Ms Meg

  Spring, Richard

  Murphy, Denis (Wansbeck)

  Steen, Anthony

  Murphy, Jim (Eastwood)

  Steinberg, Gerry

  Murrison, Dr. Andrew

  Stevenson, George

  Norman, Archie

  Stewart, David (Inverness E & Lochaber)

  Norris, Dan (Wansdyke)

  O'Brien, Bill (Normanton)

  Stewart, Ian (Eccles)

  O'Brien, Stephen (Eddisbury)

  Stinchcombe, Paul

  O'Neill, Martin

  Straw, rh Jack

  Osborne, George (Tatton)

  Streeter, Gary

  Owen, Albert

  Stringer, Graham

  Page, Richard

  Stuart, Ms Gisela

  Paice, James

  Sutcliffe, Gerry

  Palmer, Dr. Nick

  Swayne, Desmond

  Pearson, Ian

  Swire, Hugo (E Devon)

  Perham, Linda

  Syms, Robert

  Picking, Anne

  Tapsell, Sir Peter

  Pickles, Eric

  Taylor, David (NW Leics)

  Pickthall, Colin

  Taylor, Ian (Esher)

  Pike, Peter (Burnley)

  Taylor, John (Solihull)

  Plaskitt, James

  Taylor, Sir Teddy

  Pollard, Kerry

  Thomas, Gareth (Clwyd W)

  Pond, Chris (Gravesham)

  Thomas, Gareth (Harrow W)

  Prentice, Ms Bridget (Lewisham E)

  Timms, Stephen

  Prentice, Gordon (Pendle)

  Tipping, Paddy

  Prescott, rh John

  Todd, Mark (S Derbyshire)

  Prisk, Mark (Hertford)

  Touhig, Don (Islwyn)

  Prosser, Gwyn

  Tredinnick, David

  Purchase, Ken

  Trend, Michael

  Purnell, James

  Trickett, Jon

  Quinn, Lawrie

  Turner, Andrew (Isle of Wight)

  Rapson, Syd (Portsmouth N)

  Turner, Dennis (Wolverh'ton SE)

  1383

  Turner, Dr. Desmond (Brighton Kemptown)

  Williams, rh Alan (Swansea W)

  Williams, Betty (Conwy)

  Turner, Neil (Wigan)

  Wills, Michael

  Twigg, Derek (Halton)

  Wilshire, David

  Twigg, Stephen (Enfield)

  Winterton, Ann (Congleton)

  Tynan, Bill (Hamilton S)

  Winterton, Sir Nicholas (Macclesfield)

  Tyrie, Andrew

  Vaz, Keith (Leicester E)

  Winterton, Ms Rosie (Doncaster C)

  Viggers, Peter

  Walley, Ms Joan

  Woodward, Shaun

  Ward, Claire

  Woolas, Phil

  Wareing, Robert N.

  Worthington, Tony

  Waterson, Nigel

  Wright, Anthony D. (Gt Yarmouth)

  Watkinson, Angela

  Watson, Tom (W Bromwich E)

  Wright, Tony (Cannock)

  Watts, David

  Wyatt, Derek

  White, Brian

  Yeo, Tim (S Suffolk)

  Whitehead, Dr. Alan

  Young, rh Sir George

  Whittingdale, John

  Wicks, Malcolm

  Tellers for the Noes: Mr. Fraser Kemp and Joan Ryan

  Widdecombe, rh Miss Ann

  Wiggin, Bill

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31(Questions on amendments), and agreed to.
  MR DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.
  Resolved,
  That this House welcomes the current work of the Balance of Funding review of how local government in England is funded; notes that the review is receiving evidence on a number of possible reform options suggested in public consultation; awaits with interest the report of the review in summer 2004; and urges local authorities to set budgets for 2004–05 which deliver value for local taxpayers.
  Mr. Patrick McLoughlin: On a point of order, Mr. Deputy Speaker. Can you confirm that, if there were a Division, it would be deferred?
  Mr. Deputy Speaker (Sir Michael Lord): There are no deferred Divisions at the moment.

  PETITION

    Respiratory Disease and Ambulatory Oxygen
    7.17 pm
    Hugh Bayley: I rise to speak on behalf of those of my constituents who suffer from respiratory diseases that require them to breathe oxygen artificially. They are greatly concerned that, although oxygen for use at home is provided by the national health service, portable or ambulatory oxygen is not, and can only be provided privately.
    Those constituents have asked me to present a petition, which is signed by Mr. Tony Wilson, of Clifton, York, and by hundreds of other constituents. It reads as follows:
    To the House of Commons
    The Petition of members and supporters of Breathe Easy York declares that all people in Britain living with respiratory disease should get a comprehensive lung health service from the national health service.
    The Petitioners therefore request that the House of Commons press for the NHS to provide ambulatory oxygen and pulmonary rehabilitation services for those who need them.
    And your Petitioners remain, etc.
    To lie upon the Table.

    Nuisance Neighbours
    Motion made, and Question proposed, That this House do now adjourn.—[Margaret Moran.]
    7.19 pm
    Vera Baird: It is a rare surgery in Redcar that does not bring to me people who are full of anxiety about nuisance neighbours. Last weekend, into the Saturday calm of Redcar library came a couple with a horror story about their community. About a year ago, my constituents' car was taken from outside their flat; they got a replacement and parked it in the only place they could—outside their flat. Two days later, the windows had been smashed with a brick.
    Around that time, a couple of the flats on the estate started to be occupied by a pair or a group of 17 and 18-year-old lads, who seemed to congregate around them much larger groups of similar lads. A couple of them got into the habit of riding motorbikes—rather noisy and dilapidated ones—at night without lights and at speed, in and out of the alleys between the blocks of flats.
    One day, the couple came home to find furniture from an unoccupied flat all over the green between the buildings. Since the new year, the female has clearly seen a knife in the hands of a young man in a gang, who were being followed around by a group of six or seven-year-old children. The next week, there was no knife, but there was an air rifle in similar hands and the female told me that if she looked at those people on the street, they poured abuse on her. She said that they all felt under threat and that she went home with her eyes cast down. One day in January a couple of them chewed a cake half up, spat it into their hands and threw the lumps at a middle-aged woman's windows, and when she came out to protest what must have sounded like an army of feet ran across the roof of the block of flats, pulling up the aerials like weeds as they went.
    The police come. There are no complaints. The police talk to the lads and disperse them. "Yes, of course, officer, we will go", say the lads. The police go, the lads come back and the same happens again. No one in the community wants to be a witness for a prosecution, an antisocial behaviour order or an eviction. Not even the people who came to see me wanted that. They wanted to know how to move, but it is not easy to move.
    Later that week, a 20-year-old with a baby girl who was housed on an estate at the other end of the constituency called me because she wanted to move. Next door to her lives a family that is noisy, rowdy and drinks a lot, often slamming doors late at night so that neither the woman nor the baby can sleep. She is worried about her baby's welfare. Across the road lives another family whose comings and goings, with streams of visitors at all times of the day and night, heavily suggest drug dealing. She is very scared.
    The police came, as they should, about the noise. When she told them about the drugs, they asked her whether she was prepared to be a witness. Of course she was not prepared to be a witness: she is 20 and lives on her own. She has to be there when the police are not: she cannot be a witness.
    Those are random examples of hundreds and I guess that every MP could list similar cases. Apart from the misery, fear and stress that people trapped in those
    1386
    situations experience, it seems to me that both the police and the people are trapped in a nuisance neighbours conundrum: the police cannot take action without witnesses and the people are too afraid to be witnesses.
    There are some methods in force. Cleveland police have an acceptable behaviour contract campaign, which they now use for adults as well as children. They talk to people, keeping it as anonymous as possible. They take graded steps; they send graded letters, and it is pretty successful. There is a group of local authority wardens, and people can be seen talking to them, because they could be talking about grass cutting or a hole in the ground. Information can be given to the police on a reasonably anonymous basis.
    I cannot praise the Government highly enough for their recent focus on antisocial behaviour. The Antisocial Behaviour Act 2003 allows the police to disperse gangs and provides for more parenting orders; and the Housing Bill will at last require landlords to co-operate in attempts to control antisocial tenants. There have also been witness protection measures since the Youth Justice and Criminal Evidence Act 1999 allowed people to give evidence from behind a screen without having their names revealed. I have even seen a piece of equipment designed to distort people's voices.
    It is not easy, however, to have much faith in witness protection measures when the culprit lives only two doors away. The culprits will see someone going to court, check the time someone leaves home and recognise that the "plain clothes" police car outside is indeed a police car. They will recognise an incident when it is related in court, thereby recognising the person giving evidence. Someone might have a police alarm on the house, but how could the police get there in time when the neighbours live just up the street? I do not believe that the police could, in all conscience, guarantee to protect people who live so hugger-mugger with their tormentors.
    Some of the methods work, and more ASBOs are being secured, but the conundrum continues to prevail. Policing methods must be upgraded to the levels of those used historically against serious crime. The police must take the primary responsibility for gathering evidence. They must launch antisocial behaviour surveillance operations, with cameras hidden in cars, empty houses and on the roofs of public buildings. They must be able to call on professional witnesses, such as other police officers, wardens, and community support officers. They must be able to move into empty houses, or wait outside in a series of different vehicles. In that way, they can make tape recordings and observations and notes of events, and recognise the people involved. In the end, officers can testify about what they have seen done and who they have seen doing it.
    That sounds melodramatic, like cops and robbers. I am sure that the Government will think that it sounds very expensive for a response to what is antisocial behaviour and not armed robbery. However, it has become clear that antisocial neighbours can force ordinary families into real misery. The methods that I have outlined, and their costs, are justified.
    I am aware that there are some green shoots by way of developments in this matter. A series of ASBOs was obtained in Leeds on the strength of professional evidence, and I know that Sunderland council, some 40

    1387
    miles north of Redcar, is a trailblazer for the "Together" antisocial behaviour campaign. It has been tasked with looking at ways to collect evidence.
    I am also aware that ASBOs are issued under civil proceedings. Hearsay is acceptable, so it is possible for one officer to collect 10 accounts and deliver them to the court. Also, the Criminal Justice Act 2003 allows hearsay to be admitted in criminal proceedings. As long ago as 1988, a power was given to admit statements rather than oral evidence from people who were being kept away from court by fear. However, those tools are not being used. In addition to them, we need the other tools that I have described. We cannot leave people to act against antisocial behaviour on their own.
    The methods that I have outlined may allow us to win some more prosecutions and ASBOs. More culprits will be evicted, and there will be great relief as people start again to want to live where they live, but what happens to the culprits then? They have to have somewhere to live. If they have children, they will need to be rehoused, often in an area of low housing demand that may not be far away from where they used to live. In such areas, there will be plenty of voids, and plenty of other people who, for similar reasons, will have been moved in from elsewhere. The neighbourhood will be in decline already.
    It is well known that decent people can get trapped in such areas. For instance, owner-occupiers are unable to sell their properties because no one wants to buy them; even if they did sell them, they would not get enough money to buy another house. Other people to be affected would be the tenants of registered social landlords with no points to move or exchange. All that puts a new meaning on the much-used phrase, "Hello, I'm your new neighbour." Even in my surgery in Redcar—a very small microcosm of the area—we have dealt with a family that caused trouble at location A. It was moved away from there, to the relief of neighbours, and is now causing trouble again at location B.
    It was not all that long ago—in 1996, in fact—that Dundee council realised that it was moving nuisance families and antisocial behaviour around the city at the same time. It set up the Dundee families project, with the aim of changing the behaviour of problem families so that they could live unobjectionably in mainstream housing.
    An assessment by Glasgow university in 2001 said that the project was "a rare example" of an "intensive intervention" targeted at the sort of behaviour that I have described. Such projects remain rare even today, and that is the problem. The charity NCH joined the Dundee council project, because it understood how necessary it was. It knew that the children of problem families were likely to be the biggest casualties of eviction and of its aftermath—bed-and-breakfast accommodation, going into care, poor school attendance and the break-up of families.
    The Dundee project had worked with 83 families by 2001, when the Glasgow university study stated that most of them had made real progress. Their decline had been stopped.
    It is not my main point. but I want to tell the House that the project also saved money. The cost of even intensive rehabilitation is less than the cost of repeated
    1388
    evictions and of taking children into care. In addition, it obviously makes a strong contribution to maintaining the stability of the community. The point is that behaviour can be changed.
    The Dundee project works in three ways. For the worst people, there are three flats in a block where there is 24-hour supervision and intervention; the average stay is nine months. Flats dispersed through town but owned by the project offer support at the next stage down, when people have moved on. An outreach arm tries to make early interventions before either of those two courses is required.
    Behaviour is addressed by intensive work on a family group basis, with anger management, parenting and budgeting skills, alcohol and drug counselling or whatever is needed. The project is a success, although probably not with everybody; but for many families who realise that they are in the last chance saloon, it has been a success. Indeed, the project is so successful that it has been shortlisted for a national housing award. It must be good because it won a local government award for innovation in Scotland, presented by the Labour party.
    Although such schemes are rare, there are similar projects in Manchester and Rochdale—the latter in partnership with Shelter. In its first year, the Rochdale scheme reported a high number of mental health issues among problem families and that, where children were part of the problem, 35 of the 50 heads of families were single mothers. Provisionally, Rochdale, like Dundee, reports that incidents of ASB among many of those households have been reduced or have stopped.
    There is a scheme in Bolton, and Dundee has received inquiries from as far away as Devon and Middlesbrough—the next town to Redcar, where I started and where I briefly return, to finish my speech. Redcar is a little place, on the edge of the Teesside conurbation, and there are many extended families. That aggravates both elements of antisocial behaviour to which I have referred. It is doubly hard for a witness to have confidence when not only do they live in the same street as their adversary, but they know that his relations know where their relations live. Furthermore, moving problem families around a small place brings them more quickly back to where they started.
    On behalf of the Redcar people who come to me so frequently with those problems, I ask the Government to consider the two policy developments that I have proposed. First, they need to understand more fully the burden of being an intimidated victim, and ease it by putting the primary responsibility for collecting and presenting evidence on to the public authorities. Secondly, there should be more local intervention schemes to change the behaviour of nuisance families, so that they are not evicted from next door to brother on one day only to move next door to sister on the next.
    7.32 pm
    The Minister for Crime Reduction, Policing and Community Safety (Ms Hazel Blears): I genuinely thank my hon. and learned Friend the Member for Redcar (Vera Baird) for securing the debate. Although attendance is sparse, the topic is probably the top issue in the surgeries and postbags of most Members and

    1389
    councillors throughout the country. When I visit local communities, antisocial behaviour and quality of life issues are at the heart of people's concerns.
    Dealing with antisocial behaviour is hugely important. In our recent assessment, under the British crime survey, one in three people nationally—a huge number—said that antisocial behaviour affected their quality of life. It is wholly unacceptable that people have to tolerate the kind of behaviour that my hon. and learned Friend has detailed. Disgusting and despicable acts are committed against very vulnerable people, some of whom have to live with such behaviour day in, day out, week in, week out. That incessant pressure on people's lives really has to be experienced to be understood.
    The problems that many communities face cannot be tackled in isolation; they cannot simply be dealt with either by the police or the local authority and certainly not by communities on their own. It is vital that all the agencies work together—the police, local authority workers, neighbourhood wardens and social workers. Our schools are a vital element in tackling antisocial behaviour. Other officers, such as environmental health officers, are much undervalued in terms of the powers and analysis that they can bring to bear on some of the problems, especially in relation to housing.
    I have heard of some devastating experiences over the past few weeks and months as I have visited areas to talk to local people. Recently, I visited the Little London area of Leeds where 66 antisocial behaviour orders were obtained by the local authority at the end of the summer in a period of only a few weeks. In that community, all control had been lost. Children as young as nine or 10 were running amok; many of them were acting as runners for drug dealers and the whole community was at a complete loss about what to do.
    The fact that the authorities have now obtained the antisocial behaviour orders—35 of them are full orders and 30 are, at present, interim orders—has sent out a huge message to that local community. People have told me that for the first time in years they have been able to use the local play area and their children have been able to play out in peace and quiet. They have not been able to do something as simple as that, which most of us would take for granted, because of the behaviour of the minority who have made their lives an absolute misery.
    Yesterday, I was in Nottingham, visiting a local community in the Stonebridge and St. Ann's area of the city. It suffers the problems of antisocial behaviour, vandalism and young people gathering in intimidating groups, much of it fuelled by drug addiction. The authorities in the area are beginning to get a grip on the antisocial behaviour, but they have some way to go before local communities will feel fully safe and protected.
    For those reasons, my right hon. Friends the Prime Minister and the Home Secretary and I launched the antisocial behaviour action plan and campaign in November last year. We have backed the plan with £75 million of new money, to be distributed across the country with funding for every area. There will be an antisocial behaviour co-ordinator for every crime and disorder reduction partnership. Crucially, help and support will be provided for front-line practitioners.
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    My hon. and learned Friend is right: although the powers are on the statute book, tackling antisocial behaviour is a fairly new discipline and people have yet to come to terms with which powers they can use, how they can use the courts and how they can drive forward action at a local level. That is why we have set up the "Together" academy, which brings together a range of practitioners from the police, local government and the court system, and provides free training, delivered by expert practitioners who have already pushed forward the boundaries in the use of such powers. They have come across the problems before and solved them for themselves, and they are ready to share their expertise and good practice with others. The academy has now organised an event for every region of the country and, in the next six to eight weeks, it will train 3,000 people. There will be an academy event in my hon. and learned Friend's region and I urge her to get local people to take advantage of that training, so that they can be skilled up to use the new powers that the Government have put on the statute book.
    Along with the "Together" academy will go the "Together" action line. Again, that is a practical way to try to help local communities. The action line will be staffed by expert practitioners, who will be at the end of a telephone line so that people can get in touch with them and say, "I've got a problem. I do not know how to get the evidence to obtain an order. The witnesses feel intimidated—what should I do to help them?" The expert practitioners stand ready to help at every opportunity. The action line, the website and the academy are practical ways to help people deal with these issues.
    My hon. and learned Friend is right to say that antisocial behaviour spans a range of issues, including graffiti and fly-tipping, but the impact of nuisance neighbours can be enormous. We have examples from across the country of ordinary people's lives being ripped apart by the intimidation, harassment and criminal damage carried out by a small minority of families, who make life a misery for the majority. Such behaviour, as evidenced by my hon. and learned Friend, cannot go unchecked. It needs to be challenged and put under pressure, to the point where people want to change their behaviour. If they do want to change, we will be there to support them in doing so.
    My hon. and learned Friend makes the important point that obtaining orders and moving the problem around does not resolve the underlying issues for some nuisance neighbours. It is key to our strategy to develop ways in which we can prevent the antisocial behaviour in the first place, rather than transferring it when we disperse those subject to an order.
    We have set up 10 trailblazers across the country to deal with a range of antisocial behaviour, including nuisance families, but we have also set up a nuisance neighbour expert panel, which brings together people from social services, education, the police and various other agencies, to look at the hard cases with multiple problems. Those could include substance misuse, mental health problems and children with problems. The panel analyses the cases and determines exactly what support needs to be provided, alongside enforcement, to change the situation around. The first meeting of the nuisance neighbour expert panel was

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    extremely interesting and if my hon. and learned Friend's local practitioners wish to key in to that panel, we would be delighted to provide that support.
    My hon. and learned Friend cited some examples of good practice—the shelter inclusion project and the Dundee families project—where support is offered in various parts of the country to families who have been threatened with repossession, threatened with eviction, or against whom there are ASBOs. The projects are long term. The Dundee project has a residential element, with support offered 24 hours a day. Clearly, that is very intensive help for the families concerned. The projects are being evaluated, and so far the news is very encouraging, in that behaviour can be turned around.
    It is vital that we have twin tracks to our strategy: support for those who are prepared to take it, but also very tough and swift enforcement, because the majority of people in this country have to know that we are on their side in dealing with the kind of horrific behaviour that my hon. and learned Friend has identified.
    My hon. and learned Friend also raised the very important issue of witness intimidation, one of the most difficult and intractable matters with which we have to deal. As she rightly says, very often the victims of nuisance neighbours and antisocial behaviour will live in the same street, in the same community, and will have to face those who are perpetrating this behaviour day after day.
    We are doing a great deal of work around witness support. It is vital that we support people, not just from when the matters get to court, but from when they first occur, and that we take them right through the process, supporting them at every point. My hon. and learned Friend is right that the ASBOs are civil orders, and therefore we can use hearsay evidence and professional witnesses. In many cases, police forces have been prepared to do surveillance and to put in different kinds of evidence. Where authorities have got used to using the powers, they have also adopted new ways of gathering evidence. We can share that best practice, concerning ways in which evidence can be gathered, through the academy.
    At the end of the day the very best evidence is from the victims—those who have witnessed the behaviour themselves. Therefore, a key part of our strategy is to try to encourage them to come forward and to support them at every step. One of the key things that we have done is to launch "Taking a Stand" awards. Here in Parliament just a couple of months ago, we had people from all around the country who had been nominated by their local communities for their courage in taking a stand against antisocial behaviour. They were prepared to stand up and give evidence, with support. The message that that has sent to the rest of their communities is that if one stands up and is prepared to give evidence and get the ASBO, one really can transform the community in which one lives.
    The overall winners of the awards were some extremely brave women from Failsworth who had suffered antisocial behaviour for three years. They had petrol poured through their letterboxes. Their children were bullied and harassed on the way to school. Their lives were an absolute misery. They finally decided that
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    enough was enough. They came together, co-operated with the police, and obtained ASBOs. Now their community is a much better place to live in. They have recently obtained an empty house on their estate and turned it into a community drop-in centre. They have done something extremely positive with the anger, distress and hurt that they were feeling, and have been able to make a tremendous contribution to the local community.
    It can be done. I do not underestimate the difficulties that people experience in tackling antisocial behaviour, but there are examples now, beacons up and down the country, of people having been able to make a difference by standing up in this way.
    I commend to my hon. and learned Friend the "Together" campaign pack, produced to go with the academy and the action line. It contains details of all the powers available, when they come in and how they can be used. There is also a guide to running a local "Together" campaign. Perhaps we could have "Together Redcar", which would be a very good way of bringing people together.
    There is thought of running local "Taking a Stand" awards. Again, my hon. and learned Friend might like to think about organising, perhaps with her local authority, nominations of local people who have made this kind of contribution, giving them a small reward for a community project and publicising the fact that people can come forward and make a difference in their communities.
    My hon. and learned Friend has mentioned using housing powers, as well as the powers under the Antisocial Behaviour Act 2003, and I also remind her that a series of powers is being introduced in respect of housing. Demoted tenancies will be introduced from June this year. Where nuisance and antisocial behaviour occurs, demotion will remove the tenant's right to buy and security of tenure for a year, so it is a powerful weapon.
    The Housing Bill, currently before Parliament, includes the prospect of introducing selective licensing and interim management orders for houses in the private sector. A big problem has been to try to ensure that unscrupulous private landlords do not simply let their properties to people without any vetting or supervision, allowing them to indulge in antisocial behaviour without any remedy. The prospect of being able to license private sector landlords will come as an enormous relief to those in many areas of the country that have been blighted by irresponsible private landlords. Of course, many good landlords are part of voluntary accreditation and licensing schemes and manage their properties properly, but far too often irresponsible landlords allow their tenants to make other people's lives an absolutely misery.
    We will also introduce new powers in relation to noise nuisance, which, I understand, is a particular problem in my hon. and learned Friend's constituency. From 31 March, all local authorities will have the power to investigate complaints of excessive noise at night, to give warning notices in respect of that noise and, where it remains excessive after the issue of the notice, either prosecute or issue a fixed-penalty notice for £100, which is far more likely and should bring some people up pretty sharp, making them realise what their

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    irresponsible behaviour is doing to their neighbours. Noise pollution and noise nuisance are some of the most difficult things to deal with, and they cause people a huge amount of anguish in their own homes. So we now have a range of powers—from housing and managing noise to dealing with ASBOs—that are beginning to come on stream.
    I also want to highlight to my hon. and learned Friend the fact that we will also introduce powers to deal with the some of the underlying causes of antisocial behaviour. That is as important as enforcement. We will introduce individual support orders to juveniles with ASBOs. When an ASBO is made on a young person, an individual support order will be directed to the causes of the antisocial behaviour, such as substance misuse, mental health problems and anger management, so that we can try to change that person's behaviour for the future. The real success—the real prize—for us is to try to ensure that we prevent the antisocial behaviour from getting any worse and causing more concern in the community.
    Antisocial behaviour powers have been on the statute book for some years now, and we have recently tried to streamline them, to make them easier for people to use and to give them the tools to make a difference. I am delighted that there are now more than 1,600 ASBOs throughout the country. There are many more
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    acceptable behaviour contracts, and they are now being used with adults, as well as juveniles. There are nearly 4,000 parenting orders. Again, they are a key part of our strategy to try to involve the whole family in dealing with such issues. There are about 18,000 drug treatment and testing orders. Many of these problems are driven by drug abuse and addiction.
    On enforcement, we now have record numbers of police officers and community support officers, who are out there in communities, giving people some visible reassurance. For far too long, people have been crying out for that reassurance. My hon. and learned Friend will know that record numbers of police officers and community support officers are helping the community in her constituency.
    I am delighted that my hon. and learned Friend has raised this extremely important issue. I hope that she is reassured that the Government have an intense focus on the issue and that we are absolutely determined to tackle antisocial behaviour wherever it may be and to support the decent majority against the actions of the loutish minority who have made some people's lives far too difficult for far too long.
    Question put and agreed to.
    Adjourned accordingly at eleven minutes to Eight o'clock.

Preamble
[Miss ANNE BEGG in the Chair]

Health Funding (Buckinghamshire)
Motion made, and Question proposed, That the sitting be now adjourned.—[Mr. Ainger.]
9.30 am
Mrs. Cheryl Gillan: I am delighted to have obtained, through the Speaker's good offices, the opportunity to raise the funding of health services in Buckinghamshire. I extend a warm welcome to the Minister. His office telephoned me last week to ask me exactly what subject I wanted to raise. I am afraid that I told it that I wanted him to come to the House with an apology and a cheque book for the people of Chesham and Amersham. I hope that, by the time I have finished, my constituents will get both, but forgive me if my expectation is not high.
I am joined today by my hon. Friends the Members for Wycombe (Mr. Goodman) and for Beaconsfield (Mr. Grieve), and bring apologies from my hon. Friends the Members for Aylesbury (Mr. Lidington), who has been forced to attend to his duties in Northern Ireland, and for Buckingham (Mr. Bercow), who is returning from a mission abroad in connection with his international development portfolio. The five of us had hoped to participate in the debate, but I am glad that three of the five have made it, as I am sure is the Minister.
We are in trouble in Buckinghamshire because, with the approach of the new financial year, virtually every aspect of our health service will be in the red. Whether we look at the mental health trust, the acute trust or the primary care trust, we face a problem. As the Minister knows from his recent visit to the National Society for Epilepsy, even it—one of our country's leading specialist facilities—faces bitter options simply to maintain its facilities and research. About the only success story in health funding in my constituency at present is the wonderful achievement of Amersham plc, which is in the process of being acquired by General Electric. It leads the world in health science and will continue to do so from its headquarters in Amersham, something of which we are rightly proud.
I shall deal with four subjects in turn but, first, I want to place on record my admiration for the hard work and dedication of everyone who works in our local health services. Their morale, to put it mildly, is not great at the moment and I hope that the Minister will appreciate that the problems arise despite the best endeavours of our staff and managers, who do sterling work and stand in the firing line when it comes to bringing bad news to patients and front-line staff alike. The Minister goes back to his office surrounded by civil servants. The local health service officials must face the public, as I saw only recently at a meeting on Chesham hospital, in a way that perhaps he does not.
The first thing that I want to consider is the mental health trust. Since my election in 1992, I have been only too well aware of the issues surrounding mental health
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in my constituency. At that time, a facility was opened at Debenham house in the Chalfonts, and I was given a crash course in the fear and misunderstanding that can occur with regard to mental illness. However, in the 1990s I did not see large numbers being failed by the mental health system. Over the past couple of years, I have noticed that an increasing number of constituents who consult me at surgery have mental health issues. At the sharp end, it is becoming obvious that our resources are insufficient and stretched to breaking point.
By the end of the financial year, even with the most favourable out-turns, our mental health trust will have a £3.6 million hole in its finances. The reasons for the deficit range from an underlying structural problem inherited when the trust was established to the high costs of agency and locum staff, and from an overspend of about £500,000 on drugs to out-of-service placements or extra-contractual referrals, for which the current overspend exceeds £1 million. In addition, it looks as if there will be an overspend of nearly £750,000 on learning disability services.
I am the first to admit that the restructuring announced last week presents a partial way forward. The acting chief executive, Mrs. Jill Cox, whom we have all met, has done a tremendous job. By staying in post much longer than she or anybody expected, she has now negotiated an arrangement with the Oxfordshire mental health trust whereby Julie Waldron will run both trusts side by side. This is not a merger, but it may well provide economies of scale in management. It will not, however, alleviate the deficit or solve the continuing problems, such as the shortage of psychiatrists and nursing staff, and the problems with facilities, such as the Haleacre unit at Amersham general hospital in my constituency, which are in desperate need of improvement and which I believe will close. It will not prevent the possible closure of the brand new paediatric intensive care unit or provide the extra resources to help sick people who are unsupported in our communities when they are most vulnerable.
The Buckinghamshire hospitals acute trust covers three hospitals: Stoke Mandeville, Wycombe and Amersham in my constituency. The accident and emergency units are based at Stoke Mandeville and Wycombe, which, with Amersham, serve about 750,000 people. Amersham was a private finance initiative project initiated by the previous Conservative Government but built and executed under the Labour Government. It is an almost brand new facility, but we are already facing the possible closure of one of its wards—the Misbourne ward.
We have an enormous problem with the recruitment and retention of staff—a problem that will be exacerbated by the restrictions on working hours caused by the European working time directive. Again, agency costs have blown a large hole of about £5 million in the budget. Last year, I tabled questions to the Minister about the cost of the working time directive. His colleague, the Minister of State, the hon. Member for Doncaster, Central (Ms Winterton), gave answers that, frankly, were quite unsatisfactory and did not address my questions at all.
In fact, the total deficit to the acute trust will be upwards of £6 million despite the financial support of £4 million of extra resources from the Thames Valley strategic health authority. My hon. Friend the Member

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for Aylesbury has similar problems. He asked me to make the point to the Minister that a date has still not been given for the commencement of the new buildings at the Stoke Mandeville hospital. Apparently, parts of the hospital were built in the 1940s and are literally falling down. Back in April 2001, plans were confirmed to bring in private investment to improve the facilities. The Government initially delayed the development by gerrymandering in respect of the rules by which the hospital can gain private funding. Despite all the plans made, the Government have still not given the final go-ahead for building to begin. My hon. Friend wants to know when they will give a date and would like the Minister to give one now so that essential work can start on the hospital.
A consultation document has been published entitled, "Shaping the future of your local health services". The deadline for consultation is June 2004, but set against burgeoning financial difficulties, I am convinced that it is driven by concerns about cost and not about patients. My hon. Friend believes that there will be change and that the demands placed on the health service by population changes should be reflected in responses to the paper. He also believes, however, that the document gives few figures and little costing of any changes. As a result, he and I have real fears that there will be a reduction in services. What is particularly striking is that the document gives no cost of the implementation of the working time directive. Recently, however, the trust has been performing well. The reference costs published last week show that we have, and get, excellent value for money. As the Minister knows, however, the problem is that we do not have enough money—a point to which I shall return.
The PCT has been working overtime. This year, one hopes, it will break even, thanks to dedicated staff and really good management across the board. However, it has come at a price to my community. Appleyard, a much needed physical disability respite unit, has had to close. The older citizens' day hospital now opens only four days a week instead of five. Chesham hospital faces possible closure and its beds being moved to Amersham if the acute trust decides that it cannot keep the Misbourne ward open and offers it to the PCT. I suppose that there is also some good news in that the PCT plans to develop new health care facilities in Chesham. It may or may not be possible to build those facilities with beds if the Chesham hospital closes.
The hospital has a history going back 100 years and it is a much-loved institution. I admit that it has passed its sell-by date, as all things do, and that it does not offer state-of-the-art facilities, but we must not underestimate our community's emotional needs. The hospital's place at the emotional and physical heart of the community gives it protected status among my constituents. New beds at a modern facility in Chesham may be acceptable, but a journey to Amersham would be less so. However, I appreciate that that might be the outcome and I cannot prejudge the choices that we shall face as a result of uncertainties at the acute trust.
The situation in Aylesbury is lamentable. The Vale of Aylesbury primary care trust has forecast an overspend of nearly £1.8 million, as my hon. Friend the Member for Aylesbury and many others predicted. Central
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Government's relentless setting of targets has driven health care managers to distraction. With so many compulsory targets, the money needed to implement them is, effectively, ring-fenced, which prevents managers from responding to the needs of the local environment. As a result, many essential services have been sidelined and are not funded adequately enough to respond to local need.
My hon. Friend wanted me to mention the speech and occupational therapy services in Aylesbury, which are woefully underfunded. Similarly, special educational needs are not being met. Such inadequate support might lead to patients requiring more care than they might otherwise have needed.
I cannot predict what my hon. Friend the Member for Wycombe will say about the PCT in his area, but it is in much the same situation as those in my area and that of my hon. Friend the Member for Aylesbury. However, I can predict with certainty that the PCT in my area will face growing demand next year and that it will have a hard time staying out of the red.
The calls on the PCT's funds are growing and underfunding has had a knock-on effect in one final regard. The National Society for Epilepsy has 258 places in residential and nursing homes on the Chalfonts site, as well as 26 assessment beds, which see a throughput of about 270 in-patients and 2,000 out-patients a year. The NSE operates under a service agreement with the National Hospital for Neurology and Neurosurgery. It has the UK's only magnetic resonance imaging scanner dedicated solely to epilepsy, which was paid for entirely out of charitable moneys. The same is true of the 3 tesla machine, which, incidentally, will come from General Electric and will be installed later this year at a cost of more than £1.5 million.
The Government's national care standards requirements mean that all the residential units will have to be updated at an astronomical cost, which will run into millions, but the fees paid by local authorities do not cover the costs of the residential care remit. Funding for the health care of residents falls to the PCTs and the costs are currently well over £800,000 a year, but the NSE receives only £116,000. Assessments are being carried out on the residents and 50 have been completed. The balance is expected to reveal that 29 more residents will meet the criteria for 100 per cent. health care funding. I assume that I do not have to spell out the implications of that to the Minister. No systems have been established to meet the assessed health care costs of those residents and there is an ongoing dispute, but the money will have to be found from somewhere and it will come from the NSE's charitable funds.
Thames Valley strategic health authority says that the PCT in which the resident lived immediately before coming to the NSE should be the funding authority. However, the Department of Health's guidance on responsible commissioners says that where a patient moves away from the area served by their registered GP, the responsible PCT should be determined as the PCT in the area in which the patient has become resident. Matters have still not been resolved, which is adding to the NSE's financial burdens.
In addition, there are immediate therapy needs. The NSE has only one full-time equivalent occupational therapist, one full-time equivalent physiotherapist and

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no speech therapist for a population of 225 residents. That is not good for an institution that is recognised as a centre of excellence by the World Health Organisation.
In practice, the lack of funding has forced the NSE to apply for planning permission for a housing development on part of its site as the only way to plug the gap in funding. The problem is that such a development would breach the green belt, which the Government now favour but which I and my constituents do not. The proposals have aroused much genuine concern among the NSE's neighbours, for whom I have a great deal of sympathy. The Secretary of State has refused funding, which is required largely because of the effects of his regulations. I also have sympathy for the NSE. We do not want to lose the facility, which benefits my constituency and those who suffer epilepsy throughout the United Kingdom and even the world.
The Minister saw the NSE for himself the other day, so I wonder what he would suggest. Will he encourage it to apply for planning permission and to breach the green belt or will he find the funding for that first-class organisation? I hope that he will not duck the question and that he will give us and the NSE the benefit of his advice.
There is a major problem with the finances in almost every aspect of our health service—I promised to return to the underlying problem. Despite all the hard work, carried out across the hoard, to build so-called recovery plans; despite all the economies and restructuring; despite the closure of facilities and the slimming down of others, to the detriment of my constituents and others in Buckinghamshire; and despite the so-called extra moneys that I am sure the Minister will fall back on in his speech, the truth is that we are underfunded and disadvantaged by a formula that is robbing my people in Chesham and Amersham of their rights.
Thames Valley receives 18 per cent. less money per head than the national average and Chiltern and South Bucks PCT receives less per head than the English average, by £150 or more. That is a scandal. The referral rates in Bucks are really low and the reference costs show that the acute trust is below the average at both sites. It could not be more efficient if it tried and the high cost of living means that the below-average funding is harsh to say the least. That is confined not to my area alone, but almost exclusively to the south.
The Health Service Journal confirms that half the English acute trusts are not confident of hitting their year-end financial targets and one in six rated themselves "very unconfident". London and the south-east accounted for all but one of the "very unconfident" finance ratings and—surprise, surprise—those in the north-west were the most confident about their financial out-turns. The Health Service Journal goes on to reveal that the Thames Valley area will have an enormous deficit of £18.1 million, which is on top of the £24 million NHS bank support. Most interesting are the comments of Noel Plumridge, a former finance director, who says that the financial results suggest that there is a problem throughout the south.
Thames Valley has done well in the circumstances, but the consistency of the deficits suggests that the problem is in the south rather than, as Noel Plumridge
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puts it, restricted to the usual culprits. The greater restrictions on the trusts' ability to delay capital spending is storing up problems for the long term, and backdating the consultant contract and the other factors that I mentioned all contribute to the picture. The problem is that those deficits are likely to be increased next year and even the severest of short-term measures is unlikely to remedy the situation. Indeed, what out-turn does the Minister forecast for my health trusts for next year—£36 million or £40 million? He must have a figure in his files and I should like him to share it with us.
I am sure that the Minister will argue that the standard of health is better in the south than it is in the north, and hence that the deprivation factors used by the Department justify the underspend in my area. That is not a valid justification. The needs of the north are not better served by levelling down those in the south. Surely we should be advancing medical services so that those improvements and advancements can be passed to other areas of the country rather than being used to penalise us for having different health requirements.
My constituents are hard working and pay enormous amounts of tax. They are articulate and knowledgeable about what they require in terms of health care. Their voices, too, deserve to be heard. Instead, they are vulnerable to a Government who have decided that they are worth less per head in terms of health care spending than people in other parts of the country. That includes some deprived areas in our constituencies in Buckinghamshire, which the Minister never seems to take into consideration.
I said that I wanted an apology and I think that even the Minister would acknowledge that our people deserve it. However, I also want him to get his cheque book out. It would make a difference if he were even to bring my constituents up to the national average. That might mean that they would not have to wait 13 months to get a hearing aid; that we do not have a bitter battle in my community over projected plans to build at the NSE to meet the Government's requirements; that the Misbourne ward does not have to close; that mentally ill people get the support they need; that we can give patients the therapies that they require; and that we attract and retain the staff we need to serve our community. After all, the community pays for and rightly expects that service.
The Minister will have a long list of successes and figures that show that much more money is going in than ever before. Well, it is not going into my backyard. After all, I am only asking for equality of treatment and a chance to face the new financial year without the inevitable cuts and reductions in service for the most vulnerable in any society, certainly in my experience—the sick. I hope he can give us the hope that we need in Chesham and Amersham and in Buckinghamshire.
Miss Anne Begg (in the Chair): I intend to call the first winding-up speech at half-past 10, so I would be grateful if the two remaining hon. Members divided the time equally, if possible.
9.52 am
Mr. Paul Goodman: It is a great pleasure to see you in the Chair, Miss Begg.

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I congratulate my hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) on securing this important debate and on covering the ground so thoroughly. Like her, I pay tribute to the 50,000 or so NHS staff who work in Bucks, and in particular those who work in the PCT, the acute trust and the mental health trust in my constituency.
As my hon. Friend has said, an image of Bucks tends to linger—it may even linger in the Minister's mind—of a rich, lush, wealthy, well-off county. However, the reality in my constituency is somewhat different.
I want to share some figures with the Chamber. The Minister will be familiar with the Government's indices of ward deprivation, which measure some 8,414 wards in England. I want to cite some of those figures relating to wards in my constituency. For child poverty, Booker and Castlefield comes in just outside the top 1,000, at 1,006. For education, the same ward comes in at 886. The housing figures are quite striking. Cressex and Frogmore is at 929, Green Hill and Totteridge at 772, Bowerdean and Daws Hill at 573, Booker and Castlefield at 529 and Marsh and Mickelfield, incredibly, at 256.
It might be hard for some hon. Members who are not familiar with Buckinghamshire to believe that such pockets of poverty and deprivation can exist in the south, but they do. The district has a 12.14 per cent. ethnic minority population, who are disproportionately represented in those poor wards. Many are originally from Kashmir and Pakistan, and do not always speak English as a first language. They have acute health needs.
We know from the census that 8 per cent. of the local population said in 1991 that they had limiting long-term illness. By 2001, that proportion had risen to 12.6 per cent. In 2001, no less than 14,700 people were providing unpaid care to their family, friends and neighbours. That is in the context of rapid population growth in the Thames Valley area.
We have a picture of complex health need, and of a small but important deprived group who lose out when other areas are better funded. Living in pockets of poverty, they are often little better off than others in areas that are, in general, poorer. However, our constituents also have a rising demand for health care. Like my hon. Friend, I am struck by how many of my surgery cases relate to mental health—they might involve a girl who harms herself or has anorexia, or a child with a problem in attending school. The number of such cases is increasing, and they are difficult and expensive to treat.
Returning to the figures that my hon. Friend cited, although funding in Wycombe district is almost £150 a head below the English average, and Thames Valley spending is some 18 per cent. below the English average, I have no evidence that demand in my area is 18 per cent. below the English average. If anything, I suspect that it is average or above.
That brings me to the first of three themes that I want to explore: the effect on funding of the star rating system for hospitals and targets. In the last but one set of ratings, Wycombe hospital was near the top of the list. However, last year its rating fell from three stars to one.
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I doubt whether the average patient admitted to that hospital for successive operations during those two successive years would have come out of the second operation believing that the hospital had declined from being excellent to one that was regarded by the star system as poor, but that was the effect of the trust's missing Government targets relating to finance, cancer, and accident and emergency.
Missing targets is extremely demoralising for staff. I know that, because I was admitted to A and E in the hospital last year for a minor operation, and I had the chance to talk to staff. It has a knock-on effect, which was referred to by my hon. Friend, and it is not happening in a financial vacuum. Buckinghamshire Hospitals NHS trust forecasts an overspend of £4.7 million and the mental health trust an overspend of £3.6 million. The total overspend in the county could be almost £14 million, when the acute trust has to restructure and all hospitals are having to cope with the impact of the working time directive.
Hospital trusts, mental health trusts and PCTs have an obligation to manage their budgets efficiently and effectively. However, the star system and the target regime make things worse rather than better because of their inflexibility. As a knock-on, the PCT is affected if the trust misses targets and therefore loses stars. For example, Wycombe PCT has targets relating to smoking cessation and to acute care. That seems reasonable. However, the targets are given the same weight—the PCT can incur serious financial loss if it misses the smoking cessation target—and it is less obvious why that should be so.
It is not just Conservative Members or Buckinghamshire MPs who think that the star system is too rigid. Oliver Wright, health correspondent of The Times, had an article published on Monday headed "Hospital star ratings to be scrapped". It said:
"The controversial system of star ratings to assess hospital performance is to be abolished in one of Labour's biggest U-turns. Ministers, stung by criticism that the scheme is politically manipulated and does not reflect patient care, have agreed to bring it to an end within two years…Instead, there will be a much looser assessment scheme that will no longer pit trust against trust. Hospitals would no longer have to meet key waiting times targets, which many doctors claim skew clinical priorities, as much more emphasis is placed on quality of care and overall clinical outcomes. The Commission for Healthcare Audit and Inspection, the independent body that will take responsibility for assessing NHS performance from April, is also likely to end the existing regime of regular hospital inspections. In future hospitals would be inspected only when specific problems arose. The changes mean that there will have to be new measures to decide which hospitals are good enough to achieve foundation status…
The move came after intense pressure from Sir Ian Kennedy, the commission chairman, who has made little secret of his distaste for star ratings. He had pressed for them to be abolished immediately, but the Government resisted and a compromise was reached to end the assessments in 2006."
We are used to reading Government announcements in the newspapers before we hear about them in the House, but I would be grateful if the Minister either confirmed or denied that story, which appears to be extremely well briefed. Hon. Members might share my view that it would be pleasant to learn of any such changes from Ministers directly, rather than from the columns of The Times.
My second theme relates to what my hon. Friend said about Haleacre. There is concern about movement of services in my area, with its particular needs, to the

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centre and north of the county. Marlow day hospital was a facility in which a day nurse gave rehabilitation treatment to patients over 60. Recently, it closed. The patients are to be transferred to the Hayward unit in Wycombe hospital and to the Drake day hospital, which is based in Amersham hospital. I acknowledge that slots in Marlow day hospital were under-used and that all health organisations now want to provide more flexible care. I also acknowledge that the number of patients who, for one reason or another, do not want to avail themselves of transport to High Wycombe or Amersham is small to date. However, it is striking that no notice was given. That caused great stress and upset to my constituents in Marlow. No audit of social benefits provided by the hospital took place. As my hon. Friend said, people in Buckinghamshire—people everywhere—feel emotion about their local health institutions and want to be sure that their feelings are taken into account.
Above all, we cannot be sure that vulnerable people in need of treatment will not simply slip through any gaps in the system. As the director of operations at Wycombe hospital said:
"Saving cash was part of the trust's decision",
so we return to the point about the shortage of money in the area.
There is a similar problem at Riversdale hospital, which until recently had a respite unit to care for patients with early-onset dementia. That has now closed. I acknowledge that not all the patients who used Riversdale came from Buckinghamshire and that there were long-running staffing problems at Riversdale. Again, I also acknowledge that all health organisations now want to provide more flexible care. However, once again no notice was given. Patients were not consulted until after the decision had been made and we cannot be sure that vulnerable people in need of treatment will not simply slip away without getting the treatment that would have been available to them previously.
That is an especially serious problem for carers. I know from consulting South Bucks Carers Association—to whose work I pay tribute—that one of the most pressing needs that carers have is simply that for a break from time to time. Caring for someone full-time, no matter how much one loves them, can grind even the most dedicated carer down. Once again, we are faced with a problem in the Wycombe area, in the south of the county, where relatively immobile and vulnerable people have to go to the centre or north of the county for treatment.
I do not intend to repeat everything that my hon. Friend said about the possible closure of Haleacre. There is the possibility that patients will be sent to the Tindal unit in Aylesbury or to an entirely new mental hospital at Stoke Mandeville, which will deal with the needs of the entire county. Again, we have the problem of a relatively vulnerable section of the population having to go to the centre of the county, from the rest of the county, for treatment. The fact remains that a large number of patients with mental health needs will be from Wycombe, which is the biggest conurbation in the county outside Milton Keynes. There is a strong case for keeping Haleacre open, or even siting a new facility in Wycombe.
When my hon. Friends and I recently spoke with representatives of the mental health trust, I was struck by the fact that, right from the moment when the
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curtains were rolled back at the start to reveal the trust, it was in deficit. No one can claim that the trust is in deficit because it has managed its finances badly or maladroitly—there has been a problem from the start, which is why we are looking to the Government to provide a solution.
My hon. Friend the Member for Chesham and Amersham said that she was hoping for the Minister to apologise and take out his cheque book. I am not absolutely confident that we will get an apology but, although I cannot speak for her, I would be willing to pass that up if I was absolutely sure that the cheque book would come out. Now that she and I have painted a convincing picture, backed up by fact, of the health needs in Buckinghamshire—I am sure my hon. Friend the Member for Beaconsfield (Mr. Grieve) will do the same—I cannot see any reason why our funding should continue to be 18 per cent. below the average, given that our demand is not. We look to the Minister for some answers.
10.7 am
Mr. Dominic Grieve: I am very pleased that my hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) was able to secure this debate, which raises a number of important issues, and I am delighted to participate in it. I hope to amplify some points that have been made without necessarily simply repeating what has already been said. I heard nothing from either her or my hon. Friend the Member for Wycombe (Mr. Goodman) with which I disagree.
Members of Parliament are of course in a rather strange position. Unless we make them our specialist area of study, the impression we tend to form of health services is in large measure dictated by those who come to see us with health care problems. I am the first to accept that this can sometimes be misleading. I am quite satisfied that in many areas a very high standard and quality of service is maintained in south Buckinghamshire. The chairman of my Conservative association, having suffered injury and spent some time in Wycombe hospital, came out with nothing but praise for the quality and standard of care that he received. Although the national papers may frequently comment on problems within the NHS, I have very little doubt that, once one is into the system and receiving care, the standard is very good indeed.
However, there remains a problem: there are plenty of examples from my constituents that, certainly in south Buckinghamshire, some people are unable to get the care for considerable periods, and sometimes simply do not get it at all. I will give the Minister some illustrations. A family came to see me with a young child who was showing clear signs of serious psychological problems. He was no longer able to attend school. This was not just a question of truancy or bad behaviour—there was clearly a serious issue. I was horrified by the fact that he was unable to go back to school at the start of the term in January, having missed a great deal of school the previous term, and by July, when his desperate parents came to see me, notwithstanding the fact that they consulted their GP at an early stage, he had still been unable to obtain the full services of the Amersham family and adolescent unit. This was not because the unit had thought their case unworthy of

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attention, but because it was short-staffed. One of the consultants was off sick and there were no substitutes or replacements who could be brought in. By the time I wrote to the Minister to point out my concerns, a child was in a situation that urgently needed intervention, but there had been no intervention for one whole school year. That was at a critical time in that child's life. I am sure that the Minister will agree that that is neither a happy nor an acceptable state of affairs.
We must face up to the fact that, in primary care terms, the local community's perception is that the standard of services is declining. Until two years ago, one of the surgeries in Iver provided a wide range of services, such as physiotherapy, in addition to its GP service. Just before the primary care trust was set up, it was decided that it would no longer be possible to continue with those additional services. I received a letter on the matter, which illustrates the problem:
"You are quite right that the previous physiotherapy service at the Iver Medical Centre was reduced. This was a decision of the then South Bucks Primary Care Group—the responsible body to which this Primary Care Trust is a successor. The Primary Care Group was responding directly to concerns raised by other patients and professionals that the spread of physiotherapy services was uneven and unfair. For this reason, it commissioned a service that was of similar levels for each practice in the area. As the Iver Medical Centre had a higher level of service than others, it experienced a reduced service once revisions had been put into effect. It is unfortunate that, for the Iver Medical Centre patients this resulted in a 'levelling down' of service but I hope you will appreciate this was for the good of the overall service."
I made inquiries, but I could not track anyone who felt that any other surgery in the area had benefited from that levelling-down process. Instead, a centre of excellence that had previously been a fundholding practice had its services reduced. The public perception in the locality was not that anyone local had benefited elsewhere.
In addition to those two examples, I face another local problem: my constituency lies at the very bottom of the county, so it is necessary that some of my constituents cross into other health authority areas for treatment from time to time, one of which is Berkshire, which is part of the new strategic health authority. Notwithstanding that fact, we continue to have what I can only describe as the reverse of a turf war: it is no longer, "Get off my turf," but, "Please come on to my turf and take over the services, which I have difficulty supplying." We see the same thing—the Minister smiles—between the county council and the NHS over the provision of social services. All those examples illustrate the serious underfunding that pervades the entire system.
I have another letter about the provision of adequate mental health care in the area. I do not wish to repeat my hon. Friends' comments on that, but the shortfall in funding in Buckinghamshire, and the problems related to that, mean that mental health is of particular concern to us. The letter concerns a family with a young adult son who has serious mental health problems. He has tried to commit suicide several times, and he clearly has psychotic delusions and needs careful management. Because he lives right down on the border with
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Berkshire, the family must get those services from Berkshire, but no one has the money to pay for them.
The letter illustrates the problem:
"My understanding from recent discussions is that the services in the overlap area include the full range of provision, now including assertive outreach and the Chiltern & South Bucks PCT have recently included that in the Berkshire Trust Local Delivery Plan (LDP) agreement. I will copy this letter to the Chiltern & South Bucks PCT to alert them to the possible confusion about provision you have highlighted and I'm sure they would welcome contact directly from you".
The letter, of August last year, continues:
"You will also probably know that negotiations are currently ongoing between the Berkshire Trust, Chiltern and South Bucks PCT and ourselves with a view to getting the services in the overlap area included in the service agreements we have as a whole Bucks provider. My Trust Board has agreed in principle to take on the responsibility for the area"—
the following is highlighted—
"once the appropriate resources and service transfer arrangements have been agreed.
Unfortunately, these negotiations remain to be completed because there is still no collective agreement over the resources that need to be available, if we are to ensure safe, appropriate and sustainable services are provided under the responsibility of my Trust."
That letter was from the director of strategic planning of Buckinghamshire NHS trust. That is an unsatisfactory state of affairs. Repeatedly, everyone is ducking and diving, inevitably trying to find ways to turn a circle into a square, when that is simply not possible. Ultimately, the background problem is that the funding is not available.
To turn from those particular examples to more general points, which bear repeating, I would be grateful if the Minister clarified whether I am right in saying that per capita expenditure on health care in Buckinghamshire is £405 per annum. In Liverpool, the figure is £900 per annum, while in Scotland I think that the figure is £1,200 per annum, although you may know more about that than I do, Miss Begg. Those are pretty stark figures and they illustrate the absolutely central issue, which is why today's debate is taking place. We are faced with a system that has been devised over time by a Government who have decided that areas such as Buckinghamshire require much lower health expenditure than other areas. The figure for Scotland is distorted by the fact that, overall, Scotland gets a block grant, which it can spend as it likes, that is 24 per cent. higher than the total per capita in the rest of the United Kingdom. For Liverpool, however, the difference is due to a perfectly straightforward governmental choice.
The Minister will of course say that the difference is based on the Government's assessment of need. I do not disagree with that rationale. However, as every consultant in Buckinghamshire with whom I speak points out, need is not demand. Indeed, I understand that there is ample evidence—perhaps the Minister can confirm this—that there are high levels of demand in areas such as Buckinghamshire. That is not because my constituents have all suddenly become hypochondriacs who want either to clutter up their GPs' surgeries or to receive services that they ought not to try to obtain. Rather, the community is articulate.
As my hon. Friend the Member for Chesham and Amersham said, people there pay high levels of tax, they are pretty much aware of the medical services that ought

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to be available and they inquire after the availability of those services. Some people want beta interferon, because they suffer from multiple sclerosis, while others want to make use of more specialist services in the NHS. The principle behind the NHS—this has been the Government's ambition—is not that it is need-driven, but that it is demand-driven by all those who have a need. The Government are creating a situation in which there is a growing gap between the requirements created by the demand and the money that they are making available.
I have always accepted the principle that we cannot operate in a united country without the richer areas paying for the poorer. That is how every sovereign state operates, whether it be the United States, which sends huge sums from California to Arkansas, or the United Kingdom, which sends huge sums of public money from the pockets of the wealth producers in the south-east to disadvantaged areas.
However, we also have areas of disadvantage. My constituency has the 13th most deprived ward in the south-east, as well as the money. I am sure that my constituents are willing to dig into their pockets to raise standards and the level of service for others living in more disadvantaged conditions to the same as theirs, but I do not think that they see it as part of the deal that others should have a higher standard of service, which is what they are getting.
Some may slip off into the private health care system, and to some extent successive Governments have encouraged them to do so, although it is worth pointing out that when there was serious bed blocking at Wycombe hospital during the winter of 1998, the then chief executive said that he was satisfied that one of the reasons was that the Government had removed the incentive for the elderly to have private health care. That was an own goal of monumental proportions in terms of the crisis that it created.
There are other oddities, and I would be grateful to hear more about them from the Minister. It was pointed out to me at a recent meeting with consultants that some current funding measures operating within the NHS are bizarre. As diagnostic and treatment centres develop, the going rate of £262 will be paid for each case seen and diagnosis made. They range from a procedure such as a skin tag being taken, which takes 15 seconds, to a three-hour complete diagnostic assessment. One of the consequences of that bizarre funding system—I hope that the Minister will be able to respond to this—is that there will be cherry-picking as the centres develop, and inevitably hospitals will receive fewer and fewer resources and less income for carrying out the major procedures that others do not want to cherry-pick. By depriving the hospitals of volume, we shall create a system whereby the funding crisis for those that buy into services within hospital trusts will become more difficult.
I would be grateful for the Minister's response, because if that is the route that we pursue, the funding crisis that we are experiencing will get worse. What I want is not an apology, but to know what will happen next. I only have to look ahead to see that our problems will get worse. In the primary care trust allocations for Buckinghamshire, the percentage term increase for children in south Buckinghamshire at 29.2 per cent. is below the national average of 30.8 per cent., so the Government do not seem to have cottoned on to the fact
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that there are long-term funding difficulties, although I accept that in Wycombe the relevant figure is fractionally above the national average, as it is in the vale of Aylesbury, but that will not benefit my constituents.
I would also like to know from the Minister how he will deal with the problem of attracting suitably qualified staff. I realise that there is a problem, but he cannot get away from the fact that Buckinghamshire is a high-cost area. How will recruitment be done? Specialist consultants make the point again and again that the specialist nurses on whom they depend for providing services are leaving to live in London, where the weighting is better, or in lower-cost areas. That simply reflects a difficulty that we have had with virtually all forms of public service provision, including the police. Can he explain the Government's thinking in relation to tackling that problem?
Although each case concerns individual human beings, at the end of the day the issue relates to money. If the national average of overall expenditure were being received I have little doubt that the problems that beset each of the health trusts would simply disappear. I want the Minister to explain not just the short-term future but the Government's thinking in the longer term. We are getting to a point where public tolerance of such disparities will erode. Unless he heeds our comments, there will come a time in Buckinghamshire and other areas of the country when there will be growing resistance in respect of how people perceive themselves to be disadvantaged by the Government's funding formulae.
I am mindful of the Government's problems. They can examine areas of high need and decide that those are where the money should be targeted, but they should be mindful of the consequences for the people who provide the motor force for wealth generation, without whom the Government could not provide such services.
10.26 am
Sarah Teather: I, too, congratulate the hon. Member for Chesham and Amersham (Mrs. Gillan) on securing this important debate. I am pleased that she and the hon. Member for Wycombe (Mr. Goodman) made a point of paying tribute to NHS staff. When we consider such important issues, there is a danger that we overlook their hard work. This is my maiden speech in this place and my first outing as Liberal Democrat health spokesperson, so I am pleased that it concerns the issue of health funding.
Liberal Democrat colleagues on Milton Keynes council are concerned about health funding in Buckinghamshire. Milton Keynes has the fastest growing population anywhere in the country. Under the Deputy Prime Minister's communities plan, it will gain 34,000 new homes by 2016. Even without that growth, the Office for National Statistics seems to have grossly underestimated the population of Milton Keynes. My colleagues on Milton Keynes council have been working very hard with the PCT to redress that balance. Added to that problem is the question of how NHS funding is allocated. On a three-year basis, estimates based on the population in year one may be grossly out of proportion to the eventual population if there is dramatic population growth. There are existing pressures on that health service.

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The accident and emergency service in Milton Keynes was expected to serve 16,000 patients a year, but it treats 65,000. The PCT in Milton Keynes has a projected overspend of £1.8 million, but if that figure is combined with other factors, such as the projected deficit for Milton Keynes general hospital, it may be much higher. That creates real dangers for local services.
The hon. Member for Chesham and Amersham said that her area is funded at a level 18 per cent. lower than the national average. The hon. Member for Wycombe said that poverty levels in his constituency are unrecognised. Perhaps it is a case not so much of changing the formula, but of handing political control to local people. At the moment, the only accountability in the system is a change of Government. If we were to hand over political control and the ability to raise money for local services to local people, political control would exist at a level where people could see that they were making a difference. That would provide real flexibility. Changing the formula will always leave someone disadvantaged and unhappy.
Thames Valley strategic health authority is likely to have an overspend of £11.4 million by the end of the year, but it is not alone. Latest estimates predict that the North West London SHA—the SHA for my constituency—will have a projected overspend of £15.5 million, Hampshire and the Isle of Wight SHA will have an overspend of £27.9 million, and Surrey and Sussex SHA an overspend of £21 million, which is projected to double by the end of the year. There are severe problems throughout the south of England. As the hon. Member for Chesham and Amersham said, it appears that almost half of strategic health authorities in the south are very unconfident or quite unconfident about meeting their financial targets. That is a particular problem within acute trusts and mental health trusts. There is a difficulty with undiagnosed mental health problems. I have seen people in my own surgery with such problems. Not only is that not unique to Thames Valley SHA, but it is not new. That is what is most depressing.
Looking back to January 2003, I found an article in The Guardian, based on a leaked memo, saying that hospitals and clinics in the south-east of England would have to find savings of £60 million by the end of March. That included the SHA that covers Buckinghamshire. We are in the same position a year later. Each year we seem to go through the same cycle of bulimic funding and cutting. It is a nonsense and the enemy of sustainability. Worse, we do not know the extent of deficits within the national health service because there is no consistent reporting scale for financial deficits within the NHS.
The problem is about historic underfunding, and while I have no doubt about the sincerity of hon. Members, the Tories must take some responsibility for that, as must the Labour Government for sticking to the Tory spending plans. Each year we have the depressing cycle of fiddling figures and engaging in accounting sophistry to try to meet the end-of-year balance. The
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result is an NHS focused on meeting debt and political targets rather than on having the flexibility to innovate, which is what it really needs.
Mrs. Gillan: I think the hon. Lady will agree that the usual methods of tackling deficits are proving less successful this year than ever before. I know this is her first outing as health spokesperson, but surely six years after the Labour Government came into office, it is ridiculous to blame the underfunding in Buckinghamshire on the Conservative Governments of 1997 and earlier.
Sarah Teather: I thank the hon. Lady for her intervention, but part of the problem is that the Labour Government stuck to Tory spending plans, so both must share responsibility.
As we heard, five key issues are relevant to the financial pressures experienced by Thames Valley SHA this year. Recruitment and retention is a problem, particularly within the mental health trust in Buckinghamshire. Nationally, agency staff are predicted to cost the NHS £1.4 billion this year, which is £4 million a day—a tripling since Labour came to power. The Government's solution of an in-house agency seems to have had little effect. We need a long-term approach involving more flexible opportunities to pay more locally. That would allow extra payments for the cost-of-living factors within Buckinghamshire. We need to consider factors, such as inflexible shift patterns, which drive many people away from the NHS, as the Royal College of Nursing said.
Mr. Andrew Lansley: It is possible that the hon. Lady is still familiarising herself with her party's policies, but I had not understood that it was Liberal Democrat policy that local NHS bodies should have the discretion to pay outside the "Agenda for Change" flexibilities. Is she proposing that?
Sarah Teather: "Agenda for Change" does not come on line until later this year. It is our policy to have flexibility at a local level to pay more if circumstances allow.
Compensation payments, based on the ombudsman's ruling on continuing care, are also important but have not been mentioned. It is estimated that Thames Valley SHA could face a cost of £8 million. Would it not be much simpler to budget for care for the elderly in the first place and to pay for it rather than having this ridiculous fiasco now?
Another important factor is the drugs bill. About 70 per cent. of prescribing is done on a generic basis. I want the NHS to use its power as a major purchaser to drive down the cost of drugs within the NHS. There are interesting models in New Zealand, to do with reference pricing.
The Parliamentary Under-Secretary of State for Health (Dr. Stephen Ladyman): Will the hon. Lady comment on the scale of the New Zealand pharmaceutical industry and how much it spends on research compared with the pharmaceutical industry in this country?
Sarah Teather: It is true that the New Zealand industry is much smaller, but that does not necessarily

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mean that the lessons learned there are not relevant here. A conservative estimate is that we could drive down the cost of drugs by 3 per cent., whereas New Zealand has driven them down by about 9 per cent.
Perhaps most worrying is that Thames Valley SHA has not taken into account a problem that has been identified as a major financial pressure—the delay in implementing the consultant contract, which may cost as much as £5 million. Even when the contract is implemented, it will still be difficult to assess its impact on the health service. At the moment, we count doctors' heads, not whole-time equivalents, so it will be difficult to judge whether the contract will drive down hours.
The last issue of concern is the increased use of accident and emergency facilities, which was mentioned in Milton Keynes. A spokesperson for the Milton Keynes General Hospital NHS Trust said that there was a straight choice between treating patients and meeting financial targets. Ironically, an article in the Health Service Journal last month said that the Government's attempt to make GPs more accessible had made the problem worse because the 48-hour access target had made it more, rather than less, difficult for people to book appointments with GPs.
Buckinghamshire has a variety of financial pressures as a result of historic underfunding and the inflexibility of the funding formula. It is time that we moved away from cyclical debates and considered methods of preventing disease, which would cut the cost of expensive hospital treatments. We should move health care closer to home and hand real control to local government. That would allow a radical integration of health, social services, housing and environment. We could then consider the real causes of ill health and have a national health service—not a national illness service—that would be responsive to local needs.
10.37 am
Mr. Andrew Lansley: I share in congratulating my hon. Friend the Member for Chesham and Amersham (Mrs. Gillan) not only on securing this debate but on the manner in which she introduced it. She demonstrated her concern for her constituents and her awareness of their experience of the NHS, both positive and negative. I emphasise in particular the positive support that they give to those who work in the NHS in her constituency. We must understand not only what our constituents are experiencing, but the organisational and financial context in which NHS employees work. Indeed, my hon. Friends the Members for Wycombe (Mr. Goodman) and for Beaconsfield (Mr. Grieve) also addressed that issue, and I, too, wish to touch on it.
A long time ago, and more recently, I became aware of the quality of service delivered by those who work in Buckinghamshire's health services. Nearly 20 years ago, during the winter of 1984, I stayed in Buckinghamshire for some months while Margaret and Norman Tebbit were in Stoke Mandeville hospital. At that time, after the Brighton bomb, we had every reason to be grateful for the remarkable work that the staff did, and continue to do, at that hospital. Three weeks ago, I visited Milton Keynes general hospital and primary care trust, which I shall return to in the context of what the hon. Member for Brent, East (Sarah Teather) said about Milton Keynes.
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My hon. Friend the Member for Chesham and Amersham set out an interesting context for the problems in Buckinghamshire. It is clear that there is red ink right across the Buckinghamshire trusts, from the Buckinghamshire Mental Health NHS Trust, to which she made particular reference, to Buckinghamshire hospitals in general. The Milton Keynes PCT and Milton Keynes general hospital forecast deficits. Something is going on and it is clear that much of it is to do with the relative formula spending share for Buckinghamshire as against need.
We do not need to look far for the solution. I suspect that my hon. Friend already knows that there is hope in our policies because, with respect to the hon. Member for Brent, East, converting the calculation of health spending to a local body and setting up local taxation is not the answer. Inevitably, resource allocation and equalisation measures will distort every effort to achieve that. Putting control in the hands of patients, as our patient's passport intends to do, is the only way to make a difference.
Sarah Teather: Do the Tories have a funding plan for the patient's passport? I believe that it will cost about £900 million in the beginning.
Mr. Lansley: The hon. Lady will have to be patient; she will have to wait only a few days for the plan to become clear.
The patient's passport will put control in the hands of patients, benefiting them through engagement—
Dr. Ladyman: Will the hon. Gentleman give way?
Mr. Lansley: I will when I have finished my sentence.
Patients themselves will be able to engage. The Wanless report says that the engagement of the public with their health care is very important. Such engagement also discloses need rather than relying on formula share, which is especially important where long-term medical conditions such as epilepsy or mental health are concerned.
My hon. Friend the Member for Wycombe mentioned the long-term illnesses experienced by some of the ethnic minority population in his constituency. Those conditions are precisely where direct payment and the ability to control one's health care can empower people. Resource allocation begins to replace formula allocations with disclosed need.
Dr. Ladyman: We cannot allow the hon. Gentleman to get away with fobbing off the question asked by the hon. Member for Brent, East. Whether the figure is £900 million, as she believes, or £2 billion, as I believe, is it not true that the hon. Gentleman's party will put that money, which could have gone into the national health service, into the private sector?
Mr. Lansley: The Minister will also have to be patient. His belief that the figure will be £2 billion is based on a complete misrepresentation of the patient passport. If the scheme has any impact on the resources allocated to the NHS and the private sector, it will simply be to allow what I imagine to be a reduced number of people in the long term to exercise choice outside the NHS in a way

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that does not incur additional costs to the NHS. He makes a different calculation based on the whole cost of the plan and on an exaggerated number of people involved. I will not go down that path.
Sarah Teather: Will the hon. Gentleman give way?
Mr. Lansley: No, because I want to say a few other things.
My hon. Friend the Member for Wycombe raised a couple of important issues. The Minister is keen on asking questions, but he will have to answer some. One question relates to star ratings. Depending on the newspaper that one reads, the Secretary of State is either about to confirm that star ratings will be abolished or about to defend them and announce that they will be maintained. He cannot do both, but it will be interesting to hear the Minister explain the position.
We have made it clear that star ratings should go because they are a crude measure that provides a partial reflection of the situation. It is clear that the loss of some star ratings reflects organisational and financial factors and has nothing to do with clinical quality. As the hon. Member for Milton Keynes, South-West (Dr. Starkey) made clear in the main Chamber, she does not believe that the star rating for Milton Keynes general hospital is an accurate reflection of its clinical quality.
I want to say a word about Milton Keynes, which I visited not so long ago, because its services are trying very hard. I am not sure to whom the hon. Member for Brent, East spoke, but when I talked to people in the accident and emergency department at Milton Keynes it was clear that they had taken exemplary measures over the past few months to deliver what the Government's targets require them to deliver. More to the point, however, they were delivering what they regarded as a better standard of health care for those entering accident and emergency. They did that by innovating. For example, they established a clinical decisions unit at Milton Keynes general hospital. If the staff have one point to get across, as the hon. Lady said, it is that their accident and emergency unit was designed for a fraction of the number of people who are now coming to it.
We cannot explain precisely why the increase in the number of accident and emergency referrals is rising so dramatically, but the capacity of the NHS in Milton Keynes especially—although it illustrates the situation for Buckinghamshire as a whole—in no sense reflects the population and the rising demand. In response to what I heard in Milton Keynes, I said that it is vital that we revisit the whole issue of formula spending shares and how they reflect not only disclosed need in the NHS, but also population changes and characteristics. Staff in Milton Keynes are deeply concerned that although it is possible to go to developers and use the planning system to get money for roads, schools and, to some extent, GPs' surgeries, very rarely does one get money for new hospitals and still less recurrent resources for hospitals. Also, the time lag involved in the work carried out on the 2001 census data means that places such as Milton Keynes are deeply in the red as they try to manage the capacity consequences of existing arrangements.
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My hon. Friends, in particular my hon. Friend the Member for Beaconsfield, who talked about patient experiences, have illustrated what my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) said yesterday in a speech on the NHS: too often, first-rate medicine is trapped in a second-rate system. We see a lot of that in Buckinghamshire: a second-rate system that is not providing the resources, the capacity or the ability to respond to patients' health needs and disclosed wishes. This issue is not simply about being more efficient with the money available—it was made clear that reference costs, for example at the Royal Buckinghamshire hospital, are below average—but about the ability to reflect the needs of the population. In the short run, it is about that being part of the formula share. In the longer run, it is about shifting to a system, as we propose, that genuinely reflects need and some deprivation indicators when allocating public health budgets. In that way, we can move towards a system that is fairer across the country as a consequence.
I am very grateful to all my hon. Friends and their absent colleagues for their work. I am happy that we have also added something in respect of the problems as they relate to Milton Keynes.
10.48 am
The Parliamentary Under-Secretary of State for Health (Dr. Stephen Ladyman): I congratulate the hon. Member for Chesham and Amersham (Mrs. Gillan) on securing this Adjournment debate. She and her hon. Friends who represent Buckinghamshire are doing what they ought to do by championing the cause of their constituencies. They make up in enthusiasm for what they lack in accuracy and perspective.
I congratulate the hon. Member for Brent, East (Sarah Teather) on her new Front-Bench responsibilities. I am not convinced that scrapping national pay bargaining and basing the pharmaceutical price regulation scheme on the New Zealand model will be vote winners for the Liberal Democrats, but if she believes that they will be, she is welcome to take that to the country any time she likes.
Sarah Teather: I did not talk about scrapping pay bargaining; I said that there would have to be local flexibility.
Dr. Ladyman: That means scrapping national pay bargaining. That is the opposite of the argument that the hon. Lady and her colleagues deployed a few weeks ago when we debated foundation hospitals. Then, she said that foundation hospitals would pay more and create a two-tier service. She can either hunt with the hounds or run with the fox, but she needs to rethink that.
From the hon. Member for South Cambridgeshire (Mr. Lansley) we heard the first of the new Tory leadership's tax and spend commitments. Whichever way he paints it, the patient passport will transfer money from the national health service to the private sector. I

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assure him that the Government and the country will fight that tooth and nail, and we shall have some enjoyable debates.
Mr. Lansley: Are the Government therefore against spending NHS money in the private sector, at an average of 43 per cent. more than they pay the NHS for the same treatment?
Dr. Ladyman: The difference between the Government and the Opposition is that at all times we adhere to the principle that treatment in the national health service should be free at the point of need. We are perfectly happy for the national health service to buy advice services from the private sector to deliver to everybody in the community, but we are against the system that the hon. Gentleman would introduce, as a result of which many older people would have to spend thousands of pounds of their hard-earned money, with the help of a little extra from their patient passport, to get the treatment they need. If he wants to go down that route, we in the Government are delighted, because it clearly divides the two parties, and at the next election the public will know exactly what they are getting.
Before I focus on Buckinghamshire, I want to establish the general principle that we at the centre do not try to micro-manage the country's health economies. We pass the majority of national health service funding to primary care trusts, which we allow to decide how money is allocated in their areas and how services are commissioned. Therefore, local people are making decisions about the way in which services are configured and money is spent on the different aspects of service. That includes the commissioning of acute services and mental health services. If the balance in Buckinghamshire is wrong, it is in the hands of local people and local PCTs to put it right.
Mr. Grieve: I understand the Minister's point, but I hope that he will be able to deal with the funding disparities nationally, which undermine the argument that similar sums of money per head of population are handed to PCTs to spend as they wish.
Dr. Ladyman: I never implied that similar sums of money were handed to PCTs to spend as they wish. We allocate the money using what we believe is a fair formula. Let me give the hon. Gentleman some examples of the factors that the formula takes into account. If he wishes to intervene and tell me that he disagrees with any of them, he can do so.
The factors include the local population's health need and its level of deprivation; the number of people and the public sector costs in the area; and the rurality of the area, because services must be more disparate in rural areas. The impact on Buckinghamshire of the south-east effect is positive, too. All those factors are taken into account when we allocate funds, and have been when we have allocated funds to Buckinghamshire.
I notice that no Opposition Members are leaping up to say that any of that is wrong. However, the hon. Member for Beaconsfield (Mr. Grieve) had the unusual idea, which I should have thought the hon. Member for Brent, East would have screamed and shouted about, that somehow we should allocate money according not
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to need but demand; because his constituents are more eloquent and more motivated, and therefore demand more services, the Government should hand over more money to them.
Mr. Grieve: Will the Minister give way?
Dr. Ladyman: Let me finish, and then I will give way.
I suspect that the hon. Member for Brent, East has Bangladeshi communities in her constituency. Infant mortality rates in those communities will be nine times that in Buckinghamshire. Is the hon. Gentleman honestly suggesting that, because people in Buckinghamshire are demanding more services, we should be taking money away from deprived communities and giving it to their county? That is a preposterous notion.
Mr. Grieve: I note the tone of the Minister's remarks. I made it clear in an intervention that I fully understand what he says about the question of need. However, I suggest that the Government's formula on need may be missing the point. I have come to the conclusion that there is no correlation between need and demand. If we are not meeting the demand but there is a need for that demand, we will not meet the need in Buckinghamshire.
Dr. Ladyman: The hon. Gentleman makes the same point again. If he has objective reasons for disagreeing with the formula, he should cite them. The hon. Member for South Cambridgeshire, speaking on behalf of the Conservative party, should propose a new formula that could be used by a Conservative Government to distribute money around the country. We would be delighted to look at it—but if it does not take account of need, if it takes no account of poverty and if it does not recognise fairly that many areas have poor health outcomes, we will be delighted to point that out to the public at the next general election.
I shall put the health economy of Buckinghamshire into context. Of the wards in the Thames Valley area, 81 per cent. are in the fourth and fifth least deprived quintiles of the country. Wards in the area of the Wycombe PCT are rated 8,411 in the deprivation indices; the least deprived in the country is rated 8,414. I agree with the hon. Member for Wycombe (Mr. Goodman) that affluence can hide pockets of deprivation. Indeed, 4 per cent. of the wards in Wycombe are in the most deprived category. That is why we need to give the money to local PCTs, which can decide where the need is; they can then ensure that they target the needs of deprived communities.
Mrs. Gillan: I acknowledge the intellectual position from which the Minister approaches the argument. However, he is telling people in Buckinghamshire that they are worth less than half the spending on health care per head than people in Liverpool. I am sorry, but the people of Buckinghamshire are not going to accept that logic. Frankly, the Minister should be interested in levelling up the service, not levelling it down—which is what he is doing by depriving the people of Buckinghamshire of the money that should rightfully be spent on their health.
Dr. Ladyman: I am told that we should be levelling up, and that is exactly what the Government intend doing.

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That is what the formula will achieve. I point out to the Opposition that that is in the context of huge increases in spending in Buckinghamshire. Spending might not be increasing as fast as in some deprived areas, but it is increasing a heck of a lot faster than the Conservative Government would have allowed—and a heck of a lot faster than a prospective Conservative Government would allow.
As a result of the current spending round, Buckinghamshire will see a 30 per cent. increase in spending this year, next year and the following year. An extra £150 million will be going to Buckinghamshire as a result of the Government's spending plans. However the Opposition paint it, vastly more money per head is spent on health in Buckinghamshire now than in 1997.
Mrs. Gillan: It is obvious that the Minister is not going to deal with the detailed points that I and my hon. Friends have raised today. I ask him to read our speeches in Hansard and address each and every point that we and Members who are now absent have made, and to respond fully in writing.
Dr. Ladyman: I am happy to go through Hansard and answer the specific points raised by the Opposition. I am sorry that I have not had time to deal with them all in detail this morning, but—unfortunately—I was limited to 10 minutes.
The important principle that needs to be established is that Buckinghamshire's health economy is receiving huge extra investment. There is no doubt that the challenge is to decide how that funding is to be distributed and managed.

Cannabis Reclassification
11 am
Mr. Nigel Evans: I am extremely grateful for this opportunity to have the first debate about cannabis, post-reclassification. Many of the things that I shall say may not be popular, especially among certain groups. I remember debating the issue with the journalist Melanie Phillips and Keith Hellawell, the old drugs tsar, at the Oxford Union a few years ago. Needless to say, our side lost the vote, but the argument about the dangers of cannabis continues post-reclassification.
Reclassification has meant that, instead of being clubbed together with amphetamines, or speed, and barbiturates, cannabis is classed with tranquillisers and steroids. The Government state that they wish to concentrate their war on class A drugs, but cannabis was never a class A drug, and was always distinguished from crack and heroin. It was always seen, mistakenly in my view, as a soft drug.
"Cannabis is unquestionably harmful, and the dangers associated with its use should be widely known".
Those are not my words, but those of Professor Michael Rawlins, the chairman of the Advisory Council on the Misuse of Drugs, in the council's report recommending reclassification. A document more based on uncertainties and confusion I have yet to read.
Cannabis use has increased over the past 20 years, and there are now roughly 1.5 million users among those aged 16 to 24. The report talks of the acute effects of cannabis use on the brain and the heart and lungs, as well as on other organs. Cannabis constricts blood vessels, leading to higher blood pressure, an increased rate of fainting and an increased heart rate, and can worsen asthma. Cannabis intoxication can lead to panic attacks, paranoia and confused feelings, and in some cases can produce a psychotic state that may continue for some time. Such incidents may, in a few cases, be the start of a long-lasting psychotic illness, usually schizophrenia. Smoking cannabis presents a real health risk, with an increased incidence of bronchitis, asthma and lung cancer, as well as disorders of the heart and circulation. Smoking cannabis may be more dangerous than smoking tobacco, since it has a higher concentration of certain carcinogens. Some severe cases of lung damage have been reported in young people who are heavy users.
Since cannabis use has become commonplace only in the past 30 years, there may be worse news to come. Further research is required, coupled with a public health education programme. Cannabis dependence is reflected in an increasing reliance on the drug and symptoms of withdrawal when users reduce consumption or try to stop altogether. Cannabis dependence was once contested, but has now been established as a genuine problem for which people may seek help.
Unbelievably, everything that I have just said comes from the report that recommended reclassification. I wonder what the report would have had to say for cannabis to have stayed a class B drug. The report is happy to say that the gateway theory is too difficult to state one way or the other, and that the user of cannabis could move on to class A drugs because of peer pressure

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or social deprivation, which I accept. Unbelievably, the report concludes that if people are so well informed about other substances in the class B category, they could go on to those, thinking that they are as harmless or harmful as cannabis. I am amazed at such skewed logic.
I hope that the British Lung Foundation's findings may be a bit more persuasive. The foundation prepared a report on 11 November 2002, "The impact of cannabis smoking on respiratory health". Studies comparing the clinical effects on habitual cannabis smokers with those on non-smokers demonstrate a significantly higher prevalence of chronic and acute respiratory symptoms such as chronic cough and sputum production, wheeze and acute bronchitis episodes. Three to four cannabis cigarettes a day are associated with the same incidence of acute and chronic bronchitis and the same amount of damage to the bronchial mucus membrane as 20 or more tobacco cigarettes a day.
The cannabis smoked today is more potent than the cannabis smoked in the 1960s, when the average content of THC, or tetrahydrocannabinol, was 10 mg. Today the figure is 150 mg, which means that the longitudinal studies carried out in the 1960s and 1970s may not be indicative of the effects of cannabis smoked today. Cannabis tends to be smoked in a way that increases the puff volume by two thirds and the depth of inhalation by one third. There is an average fourfold longer breath holding time with cannabis than with tobacco. That means that there is a greater respiratory burden of carbon monoxide and smoking particulates such as tar than when smoking a similar amount of tobacco.
Cannabis smoking is likely to weaken the immune system. Infections of the lung are due to a combination of smoking-related damage to the cells lining the bronchial passage and the impairment of the principal immune cells in the small air sacs caused by cannabis.
The British Lung Foundation recommends a public health education campaign aimed at young people to ensure that they are fully aware of the increased risks of pulmonary infections and respiratory cancers associated with cannabis smoking. It also recommends that further research is undertaken to take account of the increased potency of today's cannabis and to establish what link, if any, there is between chronic obstructive pulmonary disease and cannabis smoking. I applaud both those recommendations.
I turn to the British Medical Journal. One toxicologist, Professor John A. Henry, talks about the increased THC, but then states:
"Tetrahydrocannabinol has cardiovascular effects, and sudden deaths have been attributed to smoking cannabis. Myocardial infarction is 4.2 times more likely to occur within an hour of smoking cannabis".
He adds:
"More studies of the cardiovascular and pulmonary effects of cannabis are essential".
I back that statement. He has extrapolated a figure from tobacco deaths of 30,000 for cannabis smokers, but chillingly adds:
"Even if the number of deaths attributable to cannabis turned out to be a fraction of that figure, smoking cannabis would still be a major public health hazard. However, when the likely mental health burden is added to the potential for morbidity and premature death from cardiopulmonary disease, these signals cannot be ignored".
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He says:
"A recent comment said that prevention and cessation are the two principal strategies in the battle against tobacco. At present, there is no battle against cannabis and no clear public health message".
Paul Flynn: I hope that the hon. Gentleman is so convinced by his own argument against smoking that from today he stops selling cigarettes from the convenience store in Swansea in which he has an interest—that he will stop his own drug pushing. If he believes that the change in the law was not beneficial, why is it that after 20 years of regulated, policed, licensed decriminalisation of cannabis in the Netherlands, there is less use of cannabis in all age groups and it is often used there in safer ways by ingesting it in ways other than smoking?
Mr. Evans: I am extremely grateful that the crusader on behalf of decriminalisation of, I suspect, any drug has been able to make it to this debate. He always adds the little gibe about the fact that I own a tobacconist's in Swansea. If he is arguing with his own Government that they should ban tobacco as well, at least let him be brave enough to say so. I would recommend to people that, although tobacco is a legal product, they do not smoke, because of the dangers that I have mentioned.
From what the British Lung Foundation and the BMJ have said, I hope the hon. Gentleman understands that this product is different from tobacco. I know that it is thrown in with tobacco and alcohol, but it is not the same. I hope that what I am going to say later will reinforce that argument but also contest some of his arguments about what is happening in the Netherlands. I will let him intervene later if he so wishes.
In November 2002, the BMJ said:
"The link between cannabis and psychosis is well established, and recent studies have found a link between use of marijuana and depression…a three year follow up of a Dutch cohort of 4045 people free of psychosis and 59 with a baseline diagnosis of psychotic disorder showed a strong association between use of cannabis and psychosis. Length of exposure to use of cannabis predicted the severity of the psychosis, which likewise was not explained by use of other drugs…
"A 15 year follow up of an adult community sample of 1920 participants in the United States showed that use of cannabis increased the risk of major depression at follow up fourfold…
"The shown dose-response relation for both schizophrenia and depression highlights the importance of reducing the use of cannabis in people who use it. It was estimated that lack of exposure to cannabis would have reduced the incidence of psychosis requiring treatment by as much as 50% in the Dutch cohort, and is similarly reflected in the Swedish cohort, showing that the use of cannabis increased the risk of schizophrenia by 30%. This large effect is surprising and not yet reflected in an increased incidence of schizophrenia in the population. If true, the use of cannabis will contribute to more episodes or new cases of the illness—food for thought for both clinicians and legislators."
The journalist Melanie Phillips has recently written about the fact that much of what I have just said, and all the studies that point to the mental as well as other ill effects of smoking cannabis, are just being ignored. Sir Michael Rawlins and his committee either did not read all those studies or came at the issue with preconceived judgments that no studies would have altered.
I understand that the Home Secretary agonised over his decision to reclassify cannabis. I hope that he did more than just agonise. In its 1997 manifesto, his party said:

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"The vicious circle of drugs and crime wrecks lives and threatens communities. Labour will appoint an anti-drugs supremo to co-ordinate our battle against drugs across all government departments. The 'drug czar' will be a symbol of our commitment to tackle the modern menace of drugs in our communities."
Sadly, the drugs tsar did not last long. He was sacked, and we have not had a proper annual report for more than three years. I cannot remember when we had a full debate on drugs in general, and not just on reclassification—a debate that we had not so long ago. Keith Hellawell, the former drugs tsar, said that reclassification has produced "a muddle" and undermined police powers in the field.
"Cannabis arrests have been steadily coming down within the confines of the existing law. Why change it, why cause a problem, why cause confusion, and why—I am sad to say—encourage in some respect greater drug taking, particularly by young people, who don't know where they stand?"
He added:
"The real issue is that the Government has given a message that cannabis is less dangerous than it was perceived to be, and they have given that message at a time when every medical institution is saying 'we are worried about the dangers, we don't know sufficient about it, and we believe the dangers are even greater than we perceive them to be at the moment.'"
The Police Federation chairman, Jan Berry, said:
"I am deeply worried that many people will see the reclassification of cannabis today as decriminalisation and we will see a rise in the number of users finding themselves drawn into a life of drugs and crime.
I would rather have seen the time and energy given to reclassify cannabis used more effectively for education and treatment programmes."
The Metropolitan police chief, Sir John Stevens, said:
"I think there is a massive amount of muddle about where we are on cannabis."
He said that he regretted the Brixton experiment. The hon. Member for Vauxhall (Kate Hoey) stated that the experiment in Lambeth led to drug dealers pushing harder drugs into the area, using their cannabis client base.
The Liberal Democrat MEP, Chris Davies, recently said that he wanted people to be able to grow cannabis in their own homes. The front page headline of the Lancashire Evening Telegraph read, "Let's have a cannabis plant in every front room—MEP". Chris Davies really is the most stupidest politician I have ever come across. He is the wackiest by a mile. It is totally irresponsible of him to say that. Youngsters will listen to people like him and think, "Oh, if a senior politician says it's okay, it must be okay."
Stories in recent articles by Melanie Phillips should send a shudder down anyone's spine. They are about the effects of cannabis use, and how it leads to suicides, depression, ruined lives and deaths. She goes through all the science, and like her, I am mystified about why the science is being ignored. I know that many people operating in the drugs field have always been pushing for reclassification. Some, such as Mike Trace, the former drugs tsar's deputy, and Roger Howard, believe that the harm reduction method and a softening of the approach are the right way forward. Melanie Phillips points to the fact that the use of cannabis has doubled
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among Dutch schoolchildren—so that experiment is failing. I know that the hon. Member for Newport, West (Paul Flynn) has different figures, but Melanie Phillips contests what he believes and says that the use of cannabis among Dutch schoolchildren is on the rise.
Kate Hoey: I congratulate the hon. Gentleman on raising the issue. I think that we, as a Government, will live to regret what we have done. Will he comment on the difference between the Swedish approach and the Dutch style? In Sweden, people start off with the clear view that they want a drug-free society. The combination of prevention and education, plus the criminal aspects, has meant that fewer people in Sweden are involved in any drug taking than in Holland and this country.
Mr. Evans: There is the attitude that Sweden is permissive on this, but it is not. Surely we want a completely drugs-free zone and policy in this country, too. It is important to get the right balance. Using the law without education is completely pointless. We are relaxing the law, but we have not quite got the education in place either. That will lead to further problems. We should get both right together. If cannabis is as dangerous as all the experts are saying, surely to reclassify it and place it in the same class as slimming tablets and antidepressants is wholly mistaken, and raises the question why the Government embarked, panic-stricken, on a £1 million campaign saying, "Hold on, cannabis is still illegal," when the message had already gone out. It is ironic, even perverse, that the Government can spend £6.5 million, which they did last year, on anti-smoking advertisements, yet they can find £1 million for a campaign on cannabis.
Paul Flynn: It is a shame that the hon. drug pusher cannot provide anything better than a journalist from the Daily Mail to argue against the recommendations of the Wootton report and the reports of the Select Committee on Home Affairs, the House of Lords Science and Technology Committee and the Advisory Council on the Misuse of Drugs. A range of reports have been published in which the science goes against what he is saying. We now have evidence from the European Monitoring Centre for Drugs and Drug Addiction and from the Council of Europe, saying that the result of the action taken in the Netherlands in separating soft drugs from hard has been the reduction of cannabis use in all sections of society and a reduction in the number of deaths from the use of hard drugs.
Mr. Evans: I thought that the vast majority of my speech was based on science. I referred to the science produced by experts from the British Lung Foundation and toxicologists writing in the British Medical Journal, who are drawing on the Dutch experiment, the New Zealand experiment and the United States experiment. I understand that the hon. Gentleman has a different point of view, but whatever the science on which he and I are relying, surely the right thing to do is to carry out yet more research, which is what the British Lung Foundation and the BMJ want, before we draw conclusions. He is citing contestable science, as I am, but instead of trying to work through the issue and get more research done, the Government have decided to reclassify.

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Surely we need more research and more education. It has been proved that smoking cannabis is much more damaging to the lungs and the heart and carries a greater risk of cancer than cigarettes, yet the Government have just spent £6.5 million asking people not to smoke cigarettes. I find it bizarre that they should reclassify cannabis and send out all the wrong signals. Their drugs policy is a shambles. In my time, it has lurched from strong to weak, from bold to bland, from coherent to confused, and from determined to downright dangerous. We need more research, not woolly thinking. We need to carry out research into the current level of experimentation, not increase that level.
The Government have got it wrong, and the consequences are frightening. Even now, they should have the guts to send out a fresh signal that we will revert to the old policy until all the research has been properly analysed and a fresh committee of experts has reconsidered the issue. Agonising over the wrong decision is simply not good enough. Turning our backs on the science, and therefore on a generation of youngsters, is totally unforgivable.
11.19 am
The Parliamentary Under-Secretary of State for the Home Department (Caroline Flint): I thank the hon. Member for Ribble Valley (Mr. Evans) for securing the debate. Adjournment debates are a good opportunity to discuss a wide range of issues that hon. Members do not necessarily get the time to discuss on the Floor of the House.
In many respects, the hon. Gentleman may be surprised that the Government agree with some of his concerns about cannabis and its effect on health. There are health issues surrounding cannabis, as there around all the class A, B or C drugs that we control. As was mentioned today, there are also issues relating to tobacco, and alcohol could be mentioned in the same breath. In some respects, the reclassification of cannabis has given us the opportunity to discuss the relative harm caused by different drugs, which has been a useful exercise.
One of the reasons why we wanted to address the issue was that before reclassification, cannabis, as a class B drug, was in the same category as amphetamines. Amphetamines are stimulants, and it is scientifically proven that they are more addictive than cannabis and more likely to be linked to psychotic episodes, they cause aggressive behaviour, they are more harmful to the heart, in that they raise blood pressure, and an overdose can be fatal. In addition, they can be injected, and there are many harm issues associated with that. How could we categorise cannabis with amphetamines—suggesting that they do equal harm—and then have a meaningful and credible discussion with those who might be using or thinking of using cannabis, given that it is clear that the harmful effects of amphetamines far exceed those of cannabis?
The Advisory Council on the Misuse of Drugs considered in depth a range of issues. Professor Robin Murray has been very involved in recent weeks in heightening awareness of the link between people who have had mental illness and drug abuse and drug taking—there is concern not just about cannabis, but
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about the use by people with mental illnesses of other drugs, illegal and legal. When I was involved in an interview in which Professor Murray took part he was asked whether, regardless of everything he had said about the dangers of cannabis, he supported reclassification. I think that I am right in saying that his answer was yes. We are discussing the relative harm that drugs can do, and we have never said that cannabis is not a harmful drug. However, our classification has to have substance and signify the relative dangers of different drugs. It must communicate to everybody—to young people in particular—the impact of those drugs.
The advisory council considered the issue in some depth in relation to mental illness. Although it concluded that there is little significant evidence of a causal link between cannabis use and the development of mental illness, particularly schizophrenia, undoubtedly cannabis use can worsen a mental illness that already exists. It is clear that heavy cannabis use can produce a psychotic state, although that is, in most cases, short-lived. Amphetamines can create that state as well, with far more serious long-term consequences.
Kate Hoey: The Minister mentioned Robin Murray. Is she aware that Robin Murray said that the drugs advisory group had nobody on it with expertise in psychosis? It is not addiction but the link with psychosis that is the problem. She has quoted Professor Murray in one context. Will she accept that he criticised the make-up of the committee?
Caroline Flint: A number of people were involved in the discussion, including psychiatrists and psychopharmacologists, and evidence was given by a number of people. There was significant expert input, both from those on the committee and from those who gave evidence to it. As has been mentioned by my hon. Friend the Member for Newport, West (Paul Flynn), the Home Affairs Committee also took evidence on the issue in some depth. Professor Murray, while drawing attention to the relative harm of cannabis for those with mental illness, stood by the view that we need to make the public, in particular those who might habitually use cannabis, aware of the situation. For many, it might be a one-off, or something that does not lead to a regular habit, but there are significant health issues for those for whom the use of cannabis, often mixed with other drugs, is habitual. He stood by what he said, which was that reclassification is the right way forward.
Sir Michael Rawlins, in a letter published in The Times on 23 January, said:
"The Advisory Council…concluded that there is little significant evidence of a causal link, particularly with schizophrenia."
Most of Professor Robin Murray's research was known to the advisory council when it was producing its cannabis report, and it is of the view that any new evidence produced since does not affect the overall weight of evidence, or its conclusions about health risks. That is not to say that we do not continually watch this area. The council examines the evidence for all drugs in all categories.
Mr. Evans: Can the Minister confirm or deny what Melanie Phillips wrote—that Customs and Excise is now not bothered about proactively searching for

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cannabis, that it is interested only in the class A stuff and that it seizes cannabis only when it is looking for other drugs?
Caroline Flint: I cannot comment specifically on that, but I can write to the hon. Gentleman on that point. There have been operations that have resulted in large amounts of cannabis being seized, but he is quite right—often in those situations there may be cannabis as well as other drugs. He may be aware of the announcement yesterday of our intention to set up the Serious Organised Crime Agency. Combating drug trafficking will be an important part of its work. He will be well aware that the maximum penalty for dealing in or supplying cannabis remains 14 years, despite reclassification—another message that we have been keen to get across.
Paul Flynn: My hon. Friend has brought a new voice and new thinking to this issue. Was she as moved as I was by the evidence given to the Home Affairs Committee by Mr. Fergus Gillespie and other parents of young people who have died as the result of the use of heroin? Mr. Gillespie said that the false and exaggerated messages about the danger of cannabis meant that his son and others did not believe the message about hard drugs, and so progressed to them from soft drugs. He was in favour of reform of the kind that the Government have just implemented.
Caroline Flint: Addiction has a terrible effect on a family. Not only do class A drugs damage individuals and families, but many young people are involved in crime to fuel their drug habit. Our criminal justice interventions programme tries to stop the revolving door of people committing crimes to feed their habit, getting into prison and coming out the other side. Whatever different views on cannabis might be expressed in this Chamber today, this Government are spending more money than ever before, to tackle not only treatment issues but the criminal justice issues in this area, which were forgotten by Governments before 1997. That is a welcome change, which has added to
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more public discussion than ever before on the connection between treatment, prison, charging and tackling crime in our communities with those affected by it in an open and positive way. That is the right way forward.
The hon. Member for Ribble Valley mentioned the strength of cannabis. We do monitor that. These issues are dealt with by the Forensic Science Service. There have been reports of levels up to 20 times stronger than 20 years ago, but that is not borne out by the evidence. The data collected by the Forensic Science Service indicates that some new products on the market have THC levels two or three times greater than those of other cannabis products, particularly the home-grown variety, but that is not a matter of course.
Sir John Stevens said that there was muddle. Of course, before any law change there is going to be uncertainty about how it will operate. That is why the Government and police need to communicate the changes effectively, both to the public and to front-line officers, which is what we have done. In the final part of his interview on LBC, he was asked whether he supported reclassification, and he said that he did.
Any change in the law means that we must consider what information we give out. The £1 million that we spent on this campaign was partly to pay for radio and newspaper advertising. That is the cost of some of these public information campaigns, although I have said to the media that if they would like to give us those spots for free we would be very grateful. We must have a credible discussion with people about these different drugs, and in particular we must give young people opportunities to access services. It is important with this reclassification that we talk to those under 18, to find out whether there are other issues that we need to attend to to stop them moving on to other drugs.
This debate over the past few weeks has been very important, because probably more has been said about cannabis than ever before, and that is welcome for public debate and democracy.
11.30 am
Sitting suspended until Two o'clock.

Strategic Waste Authority
2 pm
Dr. Alan Whitehead: Historically, dealing with waste was relatively simple. People put whatever they produced into their dustbin, a man came and collected it and took it away. The same principle applied to industrial waste, by and large, and the main concern for local authorities was to find a new tip when the old one was full. I think that it is fair to say that no recycling to speak of took place except for the marginal effects of totting at tips. I imagine that that is why we still place some 78 per cent. of household waste and some 50 per cent. of our industrial waste in landfill—the modern name for the tip. Frankly, we love our tips, and we are far more addicted to putting waste in them than any other country in Europe.
Over the past few years, waste has become far less simple. We now know that those landfills, and especially completed landfills that have been covered over, give rise to 25 per cent. of the methane produced in this country. Methane is a global warming gas that is four times as potent as CO2. In the tips that produce that methane lies thoughtlessly discarded rotting waste that could, by and large, have been recycled, recovered or reused.
We also know that the ability of the local authority to find another tip, as it would have done in previous years, is seriously constrained. In short, we are running out of holes. The Environment Agency recently estimated that we have about 10 years' worth of conceivable landfill left in London, and perhaps as little as five years' worth in the north-west. Meanwhile, of course, we continue to produce more and more of the stuff. Although the increase has abated a little in recent years, waste arisings are increasing by about 2.5 per cent. a year. Incidentally, that means that even though, as a result of increased recycling, we have marginally reduced the percentage of waste going into landfill each year, the amount of waste going into landfill continues to go up, because of the overall annual increase in waste produced.
As a country, we have so far completely failed to do what we have successfully started to do with energy consumption—decouple increased industrial and consumer activity from waste generation. Since the early 1970s, our primary energy consumption has remained roughly stable, while our gross domestic product has doubled. Waste, on the other hand, has faithfully tracked the increase in GDP all the way. Although we are having some success in recycling waste, there are few, if any, signs that we are about to produce less of it.
Among other things, our inability to deal strategically with the growth in waste makes us slow to respond to and implement the other recent phenomenon in terms of waste: the plethora of European Union directives that have arisen over the past three or four years. In 2001, there was the EU waste packaging directive, followed by the UK waste packaging regulations. In 2002, there was the so-called WEEE directive—the waste electrical and electronic equipment directive—and we followed earlier EU regulations by introducing our own end of life vehicles regulations. In the past year, there was the hazardous waste regulation, the EU ban on whole tyres going to landfill and the introduction of producer
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responsibility obligations for direct mail. In the next year, there will be producer responsibility obligations for batteries and a ban on co-disposal. In 2005, there will be pre-treatment requirements for all waste going to landfill. In 2006, there will be a ban on abandoned shredded tyres going to landfill, and there will be targets for organic waste disposal. The changes from the EU that require the UK to implement waste regulations are all far-reaching, and some overlap.
Mr. David Drew: My hon. Friend will know that the Select Committee on Environment, Food and Rural Affairs is about to bring out a report on the end of life vehicles and waste electrical and electronic equipment directives. I will not go into detail, but it was obvious, from the evidence that we received, that there is some doubt in the industry about whether the Government can deliver what was signed up to, because of the difference between objectives and action. Does he agree, and if so, what would he do about it?
Dr. Whitehead: I thank my hon. Friend for making that important point. There are overlaps between some forthcoming directives and there is a problem with clarity. On the subject of where one directive stops and another starts, a representative of the Environment Agency, who gave evidence to the Environment, Food and Rural Affairs Committee, on which my hon. Friend sits, said:
"The battery in the vehicle: is it caught by the End-of-Life Vehicles Directive? Is it caught by the forthcoming Waste Electrical and Electronic Equipment Directive? Is it caught by the Batteries Directive? Or is it caught by the Hazardous Waste Directive?"
One criticism introduced by a Select Committee from another place, which the Environment, Food and Rural Affairs Committee may be considering, is that the Government's participation in the early stages of the formation of those directives was, by and large, reactive rather than proactive, and that sometimes they considered the consequences only when the process was too far down the line.
The UK's record of transposing EU directives is far from spectacular. There are five cases against the UK outstanding in the European courts for failing to implement waste-related directives on time. Sometimes we implement directives, but do not spot the implications—the recent fridge mountain is a living testament to that—but I am confident that that will not be repeated with the forthcoming directives on end of life vehicles and on tyres. However, there is a general feeling that various Departments are not as coordinated as they might be when dealing with the representations necessary to introduce those directives in the EU and implement them in the UK.
Non-implementation means fines: we may well end up being fined about £180 million a year if we do not make the landfill directive work. If we are to avoid that fine, we must rapidly reduce the amount of waste going to landfill. The Waste and Emissions Trading Act 2003 established a cap on the amount of waste allowed in landfill, and there is now a trading mechanism between those local authorities that are ahead of their targets and those behind them. There is also a rapid escalation of the landfill levy in sight after 2005.

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Although those measures will make a significant change, we will still have the problem of what to do with the waste that has not then gone into landfill. I produced some research a while ago suggesting that, as things stand, it is likely that most of the diverted waste will be incinerated—an outcome, as we know, only just above landfill itself in the waste hierarchy.
If we do not incinerate that diverted waste, a large number of waste handling facilities will have to be established over the next few years. The European Environment Agency estimates that, if we are to meet the requirements of the landfill directive, some 27 million tonnes of biodegradable municipal waste will have to be diverted from landfill by 2016. That means that one new management facility able to process 40,000 tonnes of waste will have to be built every week for the next 14 years. To put it mildly, there are legitimate doubts about whether the planning process can accommodate such a programme.
Mr. Barry Sheerman: I am not against incineration as long as it is a balanced part of waste treatment. However, given that on average it takes eight years to get planning permission for an incinerator, are we not in danger of moving to mechanical biological treatment? In most places, this treatment has been thrown to one side—they no longer do it in Sweden, because it is ineffective. These are no answers to the crisis we face.
Dr. Whitehead: My hon. Friend underlines my point. Either we incinerate or we use alternative measures. The incineration process will take quite a while to come to maturity, given the likely development span of the planning process and the resistance in various parts of the country to new incinerators. If we go down a different path—for example, a larger number of smaller plants—the planning process will last for a similar period.
My central point is that we must decouple ourselves from our historic insistence on burying almost all the waste we produce. The consequence of doing so, and of dealing effectively with the waste directive, is that we face a difficult future as we try to reach our targets and produce a different pattern of waste management nationally. For example, my hon. Friend the Member for Huddersfield (Mr. Sheerman) is a substantial expert in the reuse, reclaiming and recycling of materials, which is one of the routes we need to take. We will have to escalate how we do all that at a local level, so that we can take that element of the waste out of the waste stream and away from landfill.
Mr. Drew: When we talk about "recycle and reuse", we often leave out "reclaim". Does my hon. Friend agree that the Government should put reclamation at least on a level footing with reuse and recycling? For example, when any building is taken down, the bricks, wood and any other material should all be made available for use. That material ends up in landfill. If we were to move in that direction, that could only help.
Dr. Whitehead: Indeed, my hon. Friend makes an important point. We normally talk about domestic
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waste, but it makes up only some 7 per cent. of the waste stream. The rest is made up of various industrial and commercial wastes, a substantial part of which are materials arising from activities such as digging up roads and knocking down buildings. Some materials are already systematically reclaimed for reuse— —for example, hardcore is recycled for foundations and road building. Ensuring that such material is systematically made available for reuse and that it is put high up the hierarchy begin to make a difference.
Mr. Sheerman: If there is no focus, no leadership and no strategy, we will again miss opportunities. Wembley stadium was knocked down and destroyed, and all of it went into traditional holes in the ground. The Minister is shaking his head, but that information came from the contractor, who said that the remit was to get rid of it.
Dr. Whitehead: My hon. Friend anticipates what I am coming to. He also emphasises the fact that the way in which we have historically dealt with our waste hangs over into an era in which we know that we must deal with it differently. This is not just a question of changing public recognition of what we do with domestic waste. The public can no longer simply put the rubbish in the bin outside the front door and go back into the house thinking that that is the end of the matter. So also with industrial and commercial practices, someone can no longer decide that a building can simply be demolished, as Wembley stadium was, and the whole of it sent to a hole in the ground.
Sue Doughty: It gets even worse. It is right to reuse such material, preferably as close as possible to the place of generation, but when virgin plywood is used in shuttering and fencing at the Home Office building in Marsham street, not only are we failing to handle what we have, but we are importing wood from dubious sources just to ruin it and throw it away again.
Dr. Whitehead: The hon. Lady makes an important point about the other end of the process. When we have put everything into a hole, too often, with a new building, we then replace what we have put in a hole with material that we need not source as new. We tend to have systems in place that encourage us to do that and discourage us from doing otherwise. Indeed, the point made by my hon. Friend the Member for Huddersfield about the extent to which building material should be available should be underscored with the idea that, just as we consider the percentage of recycled material in products generally, we should consider the extent of regulated recycled materials in new building as part of the building regulations. Again, the way forward may be a method of co-ordinating such matters.
Miss Anne McIntosh: If the hon. Gentleman accepts that the recycling and recovery of waste costs more than landfill, will he put pressure on the Government? Five years after his Government signed up to the landfill directive, they have still not set the standard for treating hazardous waste. Is it not fair to provide a lead to businesses on what standards will apply, to enable them to make the resources and investment available to meet those standards?
Dr. Whitehead: The hon. Lady exhibits psychic powers, because it says here in my notes that there is

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a similar issue with hazardous waste. As she said, hazardous waste must now be separated from non-hazardous waste on disposal sites. Some 450 sites accept hazardous waste, but, depending on the estimate, that will shrink to between 25 and 30 as the directive is implemented. As things stand, we shall probably need urgently to re-provide receiving facilities for hazardous waste that are separate from traditional disposal sites. It is not clear whether a market in which companies invest and open new receiving sites will be enough to bring this change about. The Government will have to consider urgently the need to review the progress of separating out the disposal of hazardous and non-hazardous waste by taking a market lead and through structured change, rather than assuming that the market will fill the gap, as it becomes apparent that those sites are unlikely to be available in the near future.
Local authorities continue to be in the front line of the need for rapid change in dealing with municipal waste. Outside the big cities, they are divided into waste collection authorities and waste disposal authorities. There are many examples of good practice among consortiums of waste management authorities, and many more examples of partnerships between waste management authorities and waste collection authorities. They are, however, often the result of happy accident rather than design. Members who sat on the Committee that considered the Waste and Emissions Trading Bill may recall the problems that arose when trying to write into legislation a requirement that the collection agency should separate out waste in a way that would allow the waste disposal authority to deal with it in the optimum manner.
I hope that I have described the increasing complexity of issues relating to waste and the urgency with which we need to address them. The question is how we deal with the emerging palette of problems and possible solutions, which will require careful planning and a great deal of collaboration and partnership, as well as a rapid increase in momentum over a relatively short period. Currently, we deal with them through various Government bodies nationally and locally. The Department for Environment, Food and Rural Affairs takes the lead on domestic waste, the Department of Trade and Industry deals with elements of the management of commercial and industrial waste, and the Office of the Deputy Prime Minister is responsible for funding local government and relations with it, and for planning waste management. The Treasury has a substantial hand in providing push and pull incentives for waste diversion and minimisation through green tax initiatives. The Environment Agency has a substantial role in the regulation of waste and in the development of hazardous waste inspection and disposal. As I said, various Departments have the role of discussing, negotiating and co-determining European Union directives.
In recent years, there have been substantial Government initiatives on waste, from the establishment of the national waste plan in 2000 onwards. The landfill tax credit scheme was reformed in proportion to the funding. Every year, almost £100 million is redirected to a new sustainable waste
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management programme. A new waste implementation programme—WIP—will be run by DEFRA. It has similar funding behind it, and it will undertake a package of strategic measures that were recommended by the strategy unit's investigation, "Waste Not, Want Not". For some time, we have had the waste recycling action programme—WRAP—which examines the ways in which markets might be provided for waste so that the supply and demand for new products from waste can match up in the future. In addition, there are several local authority programmes and a new delivery team and steering group. A review of the health and environmental effects of waste management and disposal, particularly of incinerators, is also under way.
Positive steps are being taken, but we still do not have targets for minimisation, which is imperative, or a realistic chance of meeting our other national targets for recycling and reuse. Unless we start at the top of the hierarchy in relation to minimisation in the near future, even if we have a better chance of meeting the other targets, we will simply be recycling and reusing it and diverting more waste from the larger arisings as they continue to mount up. Under those circumstances, we would not be able to adapt quickly enough to the changes required by the landfill levy, as my hon. Friends the Members for Stroud (Mr. Drew) and for Huddersfield mentioned.
Therefore, in my view, we need to be able to focus and co-ordinate in a way that we have hitherto failed to do. That is why I believe that the time has come to consider seriously the establishment of a strategic waste authority. The strategy unit report recommended that such co-ordination is necessary:
"A review should be undertaken to assess the merits of focusing all waste policy in one Department".
In their response to the report, the Government accepted that recommendation. They agreed that there should be a review on the merits of focusing the waste policy, and asked the Cabinet Office to carry one out. At the time of the response to the strategy unit report, the review was stated to be due for completion by the end of 2003. We are a little beyond that date—not far, but I anticipate the arrival of the report on that recommendation at a fairly early stage.
I do not envisage that a strategic waste authority would be a vast new quango. It would not require huge new offices, substantial new staff or large amounts of new equipment. It could recruit its staff from existing personnel. It would comprise technical specialists within the Environment Agency policy team, plus appropriate waste specialists from DEFRA. It would have a number of key strategic requirements and perhaps be responsible for the development of a national data reporting infrastructure. We need data to understand where we are now in order to plan effectively for the future, and we certainly do not have them in any way at the level we require.
The strategic waste authority would investigate and improve proprietary technologies in line with best practice and with emission criteria decided by the Environment Agency. It might develop operating standards for those technologies that cover organic and inorganic material processing through gasification as well as mechanical and chemical means. It might develop improved communication infrastructures with

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the Office of the Deputy Prime Minister with specific reference to developing and implementing the introduction of those various technologies in the UK regions. working with established specialists in the planning system to see how that system might accommodate the substantial changes that need to be implemented in waste management systems.
The authority would certainly have a role in agreeing acceptance dates for EU directives, looking at those EU directives early on and considering the implementation timetables in directorate-general XI. It would therefore have a clear strategic function. In doing that, it would not need to second-guess or remove local functions and initiatives. If we are to make the progress that we need to make in changing the nature of waste management, we need local initiative to flourish. Contrary to the view that a strategic waste authority would remove that initiative, having a clear way forward housed under one roof and co-ordinated between Departments would surely encourage it.
Miss McIntosh: Does the hon. Gentleman imagine that such an agency would be housed within DEFRA and act as the interlocutor with other Departments? He appears simply to be recommending that we should have another structure, whereas the message coming from industry appears to be that there is a lack of political leadership. How does his proposal overcome that?
Dr. Whitehead: I disagree with the hon. Lady. The issue that I am attempting to focus on is beyond even political leadership—and I emphasise that there has been rising awareness in the Government of the urgent need to change the nature of waste management in this country. There have been substantial political initiatives. Part of the problem is that the delivery of political initiatives—whatever is decided on, however strong that political will is—tends to be dissipated by the way in which the management of waste is organised. I would envisage that a strategic waste authority would be sited within DEFRA, but would bring together the fractured nature of waste management at a national and strategic level. That is the case I have tried to make today, from what is apparent. The authority would work with the Environment Agency and with DEFRA, but would have a single focus of activity at the centre of the Government, to bring that political will to bear on making the changes with the rapidity that is needed.
No change in our waste management strategy condemns us to a gradually more unmanageable and failing waste system. Eventually, slowly but surely, we will become engulfed in the rubbish we create. We are changing, but too slowly. A strategic waste authority is not in itself a solution—it would not make the change in its own right— but as a method of driving change
forward, quickening the pace and ensuring that the changes made work to the best result, I think we need it. I hope that the Government review agrees. If the review does not agree, perhaps the Government themselves will, having listened to the logic and the compelling case that I have laid before them today.
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Mr. Barry Sheerman: I am delighted to be here to participate in this debate, as I had a speaking engagement in Cardiff this morning and did not think that I could get back in time.
I shall try to be brief. I want to reinforce some of the arguments of my hon. Friend the Member for Southampton, Test (Dr. Whitehead), because he is also one of the small band, at least three of whose members are in this Room, which may be in danger of getting a rather quirky reputation in the House, because we are so interested in waste. A key element of environmental policy should be dealing intelligently with the waste products in our society. I am of a more practical bent than a blue or green skies person. Our old Etonian friend Jonathan Porritt should get on with the blue-sky thinking while we get on with the more practical stuff that can help save our environment and do something about global warming and much else.
Waste is a very complicated matter that goes to the heart of our environmental concerns. One serious worry is that environmental concerns have slipped down the polls every year in terms of public perception and of their priority in the hierarchy of issues in which the population are most interested. Environmental concerns have slipped down, but I can guarantee that, like all these things, they will come back into fashion. The environment will return as a much greater public concern, and the waste sector will increasingly lead into that concern.
I have several interests to declare. I am chairman of Urban Mines Ltd., a not-for-profit organisation that sees the waste flowing from our towns and cities as a new raw material that we mine for new processes to obviate the need to dig holes in the earth's crust and take virgin material. I started the organisation in 1995. It now employs 28 people and is recognised as a leading authority in this area. We help in starting small businesses that use waste as a raw material. I also helped in the plot to establish the parliamentary sustainable waste management group and am a member of Lord Lewis's Onyx environmental watchdog panel, of which he is chairman. We keep an eye on how environmentally sound major waste management companies are.
I know a bit about this issue. In respect of the "joinedupness" that several hon. Members have mentioned, the complexity is amazing. One of the problems with DEFRA is that it has never taken waste seriously enough. Personnel change too fast, so people are not kept in the Department and on the job long enough. When I take my experts into DEFRA, we are lucky to see the same people twice. Indeed, because of the policy of keeping people in a job only so long once they get the knowledge that it can give, they are moved on. DEFRA therefore has a central weakness in understanding waste issues, and I worry when my hon. Friend the Member for Southampton, Test says that the strategic waste authority may be based solely in DEFRA.
Sue Doughty: Does the hon. Gentleman share my frustration about the following issue? What happened to the knowledge in the old Department of the Environment, Transport and the Regions and all the work that it was doing on such things as hazardous

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waste? Where did that knowledge go? Surely it did not fall down a crevasse, because that team moved across to DEFRA, but there has been no continuity.
Mr. Sheerman: I agree with a great deal of that. DEFRA must take the waste sector much more seriously. It is no excuse to keep spinning off back-office operations such as WIP and WRAP—there are many other acronyms—because we know that they are less accountable than DEFRA when they are spun off. If a strategic waste authority is to emerge from the current process of policy making and consultation, we must ensure that it is properly accountable to Parliament.
The DTI plays a major role in how we manufacture things, provide services and products and use raw materials, and in why we cannot use standardised, reworked raw materials instead of taking virgin material. What standards can we lay down for the industry to ensure that alternative raw materials are seen as reliable and as good as what they replace? The DTI has its fingerprints all over waste, and it has often not taken that role seriously enough or been innovative enough when talking to the private sector. Since the European directives have begun to hit, however, the private sector has been far more effective in reducing the percentage of waste going to landfill than local authorities and others. It is the domestic waste stream that has not performed well. Given the right incentives and communications, and of course the tax incentives, industry has responded pretty fast.
The regional development agencies are now very much involved in waste. Because the DTI is largely their agency, every RDA to which one talks is involved. Some do not rank the environmental sector or environmental clusters high enough, but they are involved. The Environment Agency is intimately involved. When it was formed by the previous Administration, many good people in waste left for pastures new because they could see that the agency's priority would be the rivers and that side of the environment. There is no doubt that there was an exodus. Again, valuable people who knew about the waste sector left it.
The Office of Deputy Prime Minister is also involved. If you only knew, Mr. Hurst, how complex it becomes when every so often, in looking for the resolution of a particular waste problem, we have to go to the Office of Deputy Prime Minister and look into the planning process. I shall give an example. This is a Government who want to build new housing in the London gateway as part of a massive expansion of housing in the southeast. One of the people who gave me that information is the head of one of the biggest land banking operations in the country, a company that is part of another business, but has a large amount of property, much of which is unfilled. When the hazardous waste regulations are introduced, it will no longer be possible to put contaminated soil into landfill. It does not take much imagination to agree with my private sector expert that only 20 per cent. of landfill in our country has the capacity to take the material that will now be designated hazardous—contaminated soil. That will mean one of two things: either the development in the London gateway will not be possible or the contaminated soil will be stored throughout the country in goodness
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knows what condition. The problem is serious and affects many of the major developments that the Government are keen to see, such as the London gateway.
As I said, it takes seven or eight years to receive planning permission for an incinerator. The Government were brave and bold in their first couple of years in office, and they had a Minister who said that we needed 170 incinerators to get the balance right—a figure that has moved around a bit. They then saw that incineration might not be so popular with the great British public and retreated from that position as fast as they could, or they were, at least, told to do so. There is an incinerator in the heart of my constituency and I believe that incineration is not an environmental or health problem when it is conducted in accordance with modern standards and European regulations. As part of the solution, incineration is a good answer.
The Office of the Deputy Prime Minister is at the heart of the process and is involved in upgrading the planning regulations that touch on such matters. We cannot ignore the links between planning and the strategic waste authority or between what happens in DEFRA and other Departments, because those things are joined at the hip. Even the Department for Education and Skills is involved. I am concerned with that Department as part of my day job, because I am Chairman of the Select Committee on Education and Skills. Both the high-tech answers to the problem of replacing old plastics with new and the new techniques for dealing with waste will, like any other innovation, come from the research programmes and efforts of our universities.
Such programmes will be conducted in partnership with the private sector—there is the rub. There is so little profit in the waste sector at the moment that many companies are selling out or being taken over. The will to remain is not as strong as one would think. There are some good people in the waste management sector—my hon. Friend the Member for Southampton, Test and I know them well—but they are pretty demoralized because of the ruthless logic that they face.
There is no certainty because of the European regulations. People are asking, "When are they coming in? How fast will they be? How seriously will the Environment Agency implement them? How rigorous will they be? Is DEFRA going to derogate at some stage? What are the rules of competition?" Not only do people not know what to invest in or when to invest, but their bankers will not lend them the money. The problem is easy to identify but much more difficult to solve. The waste sector will not make capital investments in sophisticated equipment, whether it is a materials recycling facility, biological or mechanical treatment methods or anything else, because there is no certainty that such investments will ever make a profit. That goes to the heart of the problem.
I was clocking up the things that my hon. Friend mentioned, and I think that he left out Customs and Excise, which is also intimately involved in this issue. The landfill tax is increasing by £3 per tonne, thank goodness, although we all heard on the bush telegraph that the increase was going to be £5. The Treasury was quite keen on the increase, as was DEFRA, but the CBI went to the Department of Trade and Industry, which

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said in turn that the CBI would not wear that rate. I have never understood the logic of that position, but down the rate came to £3. That is not enough, but it is still better than under the previous regime.
A great deal of money is flowing in from the landfill tax, and the amount will get bigger each year. We can do something creative with that resource, but we will not solve any problems if we fritter it away on small, back-office operations such WIP and WRAP. We must do something much more dramatic. Customs and Excise has a hand in the matter, as does the Treasury. The people who will have to make the decisions are the Chancellor's advisers. To get to the heart of the matter, one has only to go to the Treasury and to talk to Ed Balls about what he considers the proper regime for environmental taxation, the level of landfill tax and much else. Indeed, the Economic Secretary to the Treasury actually knows something about the subject. I have seen the eyes of Ministers responsible for the environment and environmental taxation glazing over when I have mentioned such things, but this Minister understands it and I have great respect for him.
I was disappointed by No.10's policy discussion paper, which was not what any of us had been hoping for. However, No. 10 knows about the issue and has its sticky fingers on it. As a member of the Liaison Committee, I said to the Prime Minister last Tuesday that whenever the Government get into difficulties in delivering policy, we can see that the weakest link is the sharing of responsibility across many Departments. The Education and Skills Committee knows how complex it is to assess the skills deficiency, as skills are covered not only by the Department for Education and Skills, but by the Department for Work and Pensions, because it has a responsibility for Jobcentre Plus, the new deal, intermediate labour markets and so on. Furthermore, the Department of Health is involved in a massive amount of training, the DTI has a great role in skills and so on.
It is difficult to deliver co-ordinated and focused policy on skills, but waste is an even more difficult matter. That is why my hon. Friend is absolutely right to say that we need a strategic waste authority. We have been saying that for some years and nobody has listened, so I am heartened to learn that the proposal is being seriously considered. I would like a big, freestanding strategic waste authority with real powers to be based in a proper part of the country—in Huddersfield, in my constituency. That would be much better than locating it in Banbury. What on earth is WRAP doing there? The same applies in Guildford, which does not need the authority as much as we do.
Sue Doughty: While I do not support the proposal for a strategic waste authority, I point out that, if one were established, Guildford would be an interesting location for it, given that people there want a waste strategy. We might disagree about incineration, but we do not disagree about the need for a strategy.
Mr. Sheerman: I am reminded that, during Prime Minister's questions, the hon. Lady's predecessor used to talk about "inner-city Guildford". I used to scratch my head and think that that was an interesting concept.
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As well as a strategic waste authority, we need some refreshing, joined-up government. It must be joined up, because the problem will otherwise get worse. We do not need derogation, which would be awful, and we know that the motor for change is in Europe. If we expected local authorities to be at the cutting edge of progressive and innovative methods of dealing with waste, we would wait for results for a very long time. A few take recycling rates seriously and adopt innovative approaches to waste strategy, but the former chief executive of a major metropolitan authority has told me that when groups of chief executives in some regions get together, waste is at the bottom of the agenda. It is not sexy or interesting and it is not taken seriously. The people recruited by local authorities to deliver policy in that area are not often the most exciting on the management team. A crisis is waiting to happen, and the situation is getting worse all the time. I think that the Minister knows how bad it is. As a pragmatic, open-minded chap, he will also know that something dramatic must be done to tackle the problem.
The last issue that I want to raise is the Environment Agency. Although it plays a tremendous role, it could play a much bigger one and it needs to be freed up. In Sir John Harman, my old council leader in Kirklees and Huddersfield, the agency has a great leader and chief executive, and he has a really good team. I can imagine a re-energised DEFRA and a liberated Environment Agency with a bit more independence from the Department. Why on earth can the Minister not cut the agency free so that it is much more independent and can give the Government a bit more grief? I can also imagine a strategic waste authority working closely with its partners. If such arrangements existed, we could get rid of all the bits and bobs that have been created over time to put a sticking plaster on the problem. All the evidence suggests that a joined-up solution requires joined-up government, and a strategic waste authority is the appropriate answer.
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Sue Doughty: I congratulate the hon. Member for Southampton, Test (Dr. Whitehead) on obtaining the debate. The issue greatly exercises those hon. Members present and, I think, much of the public, who ask what we are doing about waste and how we decide what to do. Although I do not agree with his solution, his analysis is absolutely right: no change is not an option. This is a matter of urgency and we must deal with some grave issues.
The proposal was, I think, born out of frustration, and the speeches that we have heard so far have been characterised by frustration. By implication, if DEFRA, as the Department that holds the ring on the issue, were doing its job properly, there would be no need to call for a strategic waste authority. However, I cannot buy into the idea of setting up another quango, whether or not it is part of DEFRA. In any case, quangos eventually split off and disperse. What we need is political leadership.
In its May 2003 inquiry on the future of waste management, the Select Committee on Environment, Food and Rural Affairs said:
"We are concerned that Defra still appears to lack the capacity, the vision, the sense of urgency and the political will to break the mould and bring about truly sustainable waste management."

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Setting up a strategic waste authority would cause more delay and give the Government something to hide behind. Hazardous waste has been mentioned. One of the big problems faced by members of the Environmental Audit Committee when we asked the Secretary of State for Environment, Food and Rural Affairs about that before Christmas was her incredible complacency. As I said, we need leadership, not another body to carry out the necessary tasks.
The hon. Member for Huddersfield (Mr. Sheerman) mentioned the Liaison Committee. When the Prime Minister was asked about the environment, he parried the question and moved on to the next one—the issue is not on his agenda. That remains the case and setting up an alternative organisation will not change that.
The point about the dead hand of the Treasury was eloquently made, and I, too, would have raised it. Setting up a new agency will not remove that dead hand. We can have report after report, difficulty after difficulty, but if the Treasury will not pay, nothing will happen. The problem is the lack of co-ordination. One of the key roles of DEFRA and, to an extent, the Department of Trade and Industry is to implement EU directives and regulatory measures, such as the WEEE directive. Indeed, progress towards sustainable waste management has been driven by the EU. Usually, EU measures come through, we change a few words, call them Bills and implement them, but at the same time we duck the opportunity to introduce a proper waste Bill.
The Environmental Services Association said in evidence to the House of Lords European Union Committee that the UK's implementation of European waste law has occasionally been chaotic. I cannot disagree. We learned from an answer given on 2 February 2004 that the Department for Environment, Food and Rural Affairs has met only seven of the 55 transposition deadlines for an EU directive. I am not sure that a separate strategy unit would change what is going wrong with regard to waste-related failures and the four-year derogations that we are having to use for the landfill directive targets. Fortunately, the Minister was not in post at the time of the refrigerator fiasco, so we can quickly move on from fridges to other things, such as hazardous waste.
I have been bidding for a separate debate on hazardous waste for several weeks. It would take a full hour and a half to debate that subject. As we still have not seen a draft proposal, industry is not able to invest in new sites and facilities. Indeed, the final regulations on what business should be doing to manage the problem will not be finalised until after they are supposed to have been implemented. The final regulations will come into effect in September 2004, yet the provisions are required to be implemented by July.
The Minister says that every now and then we can build a cell in a landfill site. I understand that the only time it was ever tried it was so expensive and difficult, and so impossible to run, that no one wants to do it again. Shanks has looked into the problem, but it has no intention of putting cells into landfill sites to take hazardous waste.
Another problem is that such a solution would allow only for non-reactive waste. The Government do not know how much hazardous waste is non-reactive. I was told this in a written answer:
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"The Special Waste Regulations 1996 (as amended) do not require producers of special or hazardous waste to record whether or not waste being produced or disposed of is non-reactive." —[Official Report, 6 January 2004; Vol. 416, c. 265W.]
However, we have solutions that are supposed to deal with that.
We need a clear legal framework, with long-term regulatory certainty, before we can invest in the sites and the necessary technologies. Is DEFRA going to review its approach to the implementation of EU directives to ensure that industry has sufficient lead time? We are chewing the carpet and not getting anywhere because of DEFRA's lack of strategy.
As the hon. Member for Huddersfield said, there is a lack of co-ordination between Departments. How much is being done to ensure that producers design waste out of their products and processes? The Department of Trade and Industry had to be told by the strategy unit that it needed to look at the British Standards Institution standards on recyclates because the standards supported by the DTI worked against their use. The Department also failed to co-ordinate with the Environment Agency on the WEEE directive, which led to unacceptable delays in producing the information needed for businesses to plan and implement their strategy. Another problem was the failure to coordinate with the ODPM on planning reform, although I shall not say much about that because it has been well covered and the point well made. We need clear guidance and we want it to balance local interests with the need for communities to take responsibility for their own waste. Those are also problems for us to address.
On green taxes, why did it take so long for the landfill tax escalator to be speeded up? Why did it take so long to reform it so that the income could be directed to sustainable waste projects? Why do we not have an incineration tax? Those are Treasury questions, and something should be done about them.
The failure to ensure sufficient and secure funding for the waste management sector is another problem. Again, I doubt whether a strategy group or an agency would achieve that. We need to double the money that we spend on domestic waste to levels similar to those in other European Union countries. It is no wonder that we fail. We do not invest to succeed; we underinvest to fail. Then, irony of ironies, we have to pay the fines when we fail and we waste money.
There is a funding gap. The Environmental Services Association believes that we need to double the money spent on the management of domestic waste. Do the Government accept, however, that they need to increase funding? If they think that is wrong, what do they think should be happening? Those are leadership issues, not necessarily agency issues. Have they made a real estimate of the number of facilities needed? We get some answers but we need to meet those commitments. We have already got to the concept of waste management and discussed the number of facilities, the different types of facility and whether they are for fridges, clinical waste or hazardous waste, but where is the money coming from?
Local government and the Environmental Services Association would again favour a permissive power for local authorities to use direct charging for waste services. When combined with the variable charges for

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the amount or content of waste, that could be a valuable driver for recycling and waste minimisation. We must find out whether it could work. There were plans for a pilot scheme, but what has happened to it? We want to know why local government cannot be trusted to make decisions on the matter. There are stoppers in the system. Innovative local authorities say, "Could we do this?", but they are not getting the support.
We do not see much progress on waste. The items that have been introduced have not explained the lack of progress. I do not understand how a strategic waste authority would solve the problems when leadership is so absent. I am not against DEFRA; my husband worked for it in a senior position until just before I was elected. I know some of its people very well and I want the Department to be allowed to succeed and get on with what it should be doing.
For a long time we have had excuses, such as the loss of expertise when the Environment Agency was set up. However, it has been established for nine years and the Government are only now recruiting staff to DEFRA to deal with the problems that it has been unable to tackle. The hon. Member for Southampton, Test suggested that staff need to be recruited. If it is true that there is a shortage of staff and that people poach each other's staff, I should like DEFRA to be given the opportunity to train, develop, promote and recruit good staff to strengthen its team so that it can move forward instead of remaining inert.
When a quango is set up, there is a new body, chief executive, premises, including newly rented premises from some other organisation, new letterheads and a pension scheme. DEFRA has too many quangos and I cannot understand how one more is a good idea.
Mr. Sheerman: Perhaps the hon. Lady misunderstands the point that my hon. Friend the Member for Southampton, Test and I made. We want to get rid of some existing quangos and replace them with something effective.
Sue Doughty: I thank the hon. Gentleman for that. If we could identify the quangos that should go and those that should take schemes under their wing, there would be a case for some responsibilities going to them. I am not convinced that they would solve some other problems within the Government, however. I take his point that there need not necessarily be a new organisation, but a reformed one. Similarly, some duties could be passed on to the Environment Agency.
Tribute was paid to the agency and its management. I share in that tribute. At its inception, it could have been a weak organisation that concentrated mainly on rivers, water and sewage. It has grown in ability and expertise and has gained the respect of us all over the years. It is one of the few non-governmental organisations about which I would say, "Let it grow more," because of the quality of its work in placing checks and balances on the Government, business and the community and its leadership.
DEFRA needs to be run much better. The House of Lords European Union Committee examined the development of waste policy in Europe. Its report said:
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"The UK has a poor record of influencing EU waste policy. It needs to operate at a more strategic level."
It went on to call for a
"far greater level of collective working within Government, overseen and co-ordinated by a dedicated unit at the centre with the task of ensuring clear accountability to successes and failures."
I agree with that. DEFRA must be responsible for coordination. It is not in dispute that more integrated coordination across the Government is required.
Britain fails to negotiate European directives on the one hand and then fails to implement them on the other. Somehow we must find the energy to go back and negotiate with the European Union. We must develop single points of information for stakeholders. The Office of the Deputy Prime Minister seems to communicate with councils and others effectively. Any council that has received a letter about potential capping of the council tax knows how quick off the mark the ODPM is on such matters. The quality of communication and publications from DEFRA and the Department of Trade and Industry—for example, the WEEE directive—could be improved. A common approach is needed and the Government must work cross-departmentally. Another agency would well and truly guarantee that the Government will lose the plot, if they have not already done so.
3.6 pm
Miss Anne McIntosh: I congratulate the hon. Member for Southampton, Test (Dr. Whitehead) not just on securing the debate but on securing it at a timely juncture. However, I ask him and the Government to look cautiously at the model that he outlined, given that the Government are studying another agency, the Strategic Rail Authority, most carefully. That agency, which was set up by the Labour Government, has fragmented the industry even further and may be disbanded. My starting point is to ask why he wants to create a new agency when the Government are probably considering streamlining existing agencies in other areas.
Mr. Sheerman Mr. Sheerman rose—
Mr. Alan Hurst (in the Chair): Order. The hon. Lady is not giving way.
Miss McIntosh: Thank you, Mr. Hurst. I was most interested in the comments of the hon. Member for Huddersfield (Mr. Sheerman) and would like to respond to some of them later.
The industry makes a clear point—the hon. Member for Guildford (Sue Doughty) touched on this—that the Government, and the Departments that were identified in the contribution of the hon. Member for Huddersfield, are not demonstrating joined-up government or political will and leadership. Why would the Government consider a new authority now? How would they pay for it? I understand that £1.5 million has been suggested for the first year, presumably to set up the agency. Where would the money come from? Would it involve additional funds for the Environment Agency or would it be taken from its budget or DEFRA's? Several hon. Members spoke at great length about the role of the Environment Agency. From its website, it

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appears that the additional responsibilities should lie with it, working as it does under DEFRA's umbrella. The website states clearly that the agency's role is to regulate waste management through a system of licences.
Waste is material that people discard at home or at work because it is no longer needed. I was struck by the answer on tonnage given by the Minister for the Environment. In a recent reply, he stated:
"According to the most recent Municipal Waste Management Survey, about 28.8 million tonnes of municipal waste were collected in 2001–02. Of this, about 22.3 million tonnes were disposed of to landfill, 2.5 million tonnes were incinerated, and 3.9 million tonnes were recycled." —[Official Report, 4 February 2004; Vol. 417, c. 906W.]
The Government have a dilemma, as there is an increasing gap between the amount of waste sent to landfill and the amount allowed under the landfill directive. The Minister will have picked up on that concern, which was expressed by several hon. Members.
My first question to the Minister is, why is there a need for a new waste authority? I want to know why we cannot strengthen the waste unit, as I would prefer, possibly under the Environment Agency. What would the additional cost of £1.5 million cover? Would it cover purely the introduction of additional bureaucrats, or would some of the bureaucrats be officials brought in from other Departments? Where will the money come from—an increase in the budget for DEFRA, or its existing resources? In the latter case, funds would be diverted from other projects.
The hon. Member for Huddersfield identified a very confused situation. Let me focus on some agencies. DEFRA leads with the responsibility for waste policy in England, and has residual responsibility for co-ordination across the UK. The Treasury leads on fiscal instruments. The DTI leads on producer responsibility and policy relating to industry. The Office of the Deputy Prime Minister leads on planning issues in relation to land use and local government. Not many colleagues have focused on the role of local authorities, but they are the key delivery partners when it comes to making a success of the Government's waste strategy, and they face a confusing array of policies and funding streams.
Will the Minister respond to what he understands the concerns of the industry to be? I understand that it has identified three. It wants more regulatory certainty and a greater lead-in time, so that it can make the required investment that we have identified. It also needs more funding. That funding has to come from central Government and the industry itself. Finally, it needs a less complicated and more streamlined planning process. That would allow UK waste companies to invest in the thousands of new facilities that will be required.
Is the Minister aware that the European institutions are about to agree the amended directive on packaging and packaging waste? By 31 December 2008 at the latest, the UK will be required to recover a minimum of 60 per cent. of waste, in terms of waste volume, or to incinerate it in incineration plants with energy capability. Between a minimum of 55 per cent. and maximum of 80 per cent. of waste, by weight, should be recycled. In relation to incineration, we might have regard to what is happening so successfully in countries such as Sweden and Denmark. They have a deservedly
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high reputation for being committed to green environmental policies, and they incinerate large quantities of their waste. I understand that most of the incineration is smokeless and that most of the incinerated waste benefits the local community through distance warming. Has the Minister's Department given some thought to that? The lead-in, in terms of planning policy, to what would presumably be a new style of plants in the UK would be substantial.
The hon. Member for Southampton, Test is a brave man. He is the only person to date who has recommended a specific strategic waste authority. In evidence from the Environment Agency that was included in the report by the Environmental Audit Committee, it was stated that the strategic waste authority
"could be a single body",
or that there could be
"provision for enhanced roles for one or more existing organisations."
Neither the Environment, Food and Rural Affairs Committee nor the Environmental Audit Committee recommended the establishment of a single strategic waste authority. I agree with all those who have expressed their concerns about the plethora of legislation coming from the European Union, and the implications for the waste industry and waste management when it comes to recycling, incineration and landfill.
On the debate on Wembley, I was led to believe at my local tip that wood is the single most difficult product to dispose of. It cannot easily be recycled and used in other buildings.
I reiterate that what is lacking is strong political leadership, and it is far more important to develop that than to focus on restructuring. That is precisely the viewpoint expressed by the industry. The model of the strategic waste authority may not necessarily be the best; we could beef up a separate unit within DEFRA or, more specifically, within the Environment Agency. We look to the Minister to demonstrate that the Government have the necessary political will.
3.15 pm
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Mr. Ben Bradshaw): I congratulate my hon. Friend the Member for Southampton, Test (Dr. Whitehead) on securing the debate and apologise that my hon. Friend the Minister for the Environment could not be here to reply. As I am sure hon. Members are aware, he is the Minister responsible for waste, but he is otherwise engaged in a debate in the Chamber on an Opposition day on the environment in general. He sends his apologies.
I am afraid that I am not sighted on some detailed questions, and in particular those from the hon. Member for Vale of York (Miss McIntosh). I will ensure that my hon. Friend writes to her with answers to those questions and those of other hon. Members which, having had a very short time in which to brief myself on the subject, I am not in a position to answer.
My hon. Friend the Member for Huddersfield (Mr. Sheerman) rather unkindly suggested that people concerned with waste are quirky. He may feel quirky, but this is a serious subject. Having listened to the

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debate it is obvious that it is not only serious but complex, as one or two other hon. Members have said. That came through in the fact that there are a number of different ideas on the way forward—an indication of the difficulties that would face any Government trying to get to grips with this important environmental problem.
I would like to outline where the Government have made some advances, on which my hon. Friend the Member for Southampton, Test was generous enough to touch. We have made waste one of our Department's six key priorities. One of the most exciting areas where progress is being made is in the increase in recycling figures. We are finally beginning to see the fruits of those policies, not only in the hard work of local authorities but in Government action. Initial estimates suggest that England had a recycling and composting rate of 15 per cent. in 2002–03, with an increase of about 2 per cent. on 2001–02. That means that we have broken the 1 per cent. increase barrier for the first time, which is very encouraging. With a similar increase in 2003–04 we will meet our target of 17 per cent. for that year.
Although we still have a challenging target to meet in the next couple of years, my officials were confident this morning that it is achievable. Some local authorities are already achieving it, and we anticipate an increased rate of improvement in the coming year once the benefit of some recent and new initiatives is realised. They include, as Members have said, the national waste minimisation recycling fund and the waste implementation programme, about which I shall say more in a moment.
The landfill directive targets on the horizon also present a test. However, we are making good progress in developing the landfill allowance trading scheme. Building effective working relationships is an essential part of that work. Hon. Members touched on where responsibility for waste lies. Currently, the strategic lead lies with DEFRA, with the DTI leading on some producer responsibility initiatives. The Environment Agency, sponsored by DEFRA, is responsible for regulating waste management facilities and other bodies, including the ODPM, the Treasury and of course local authorities, are all important in the development of policies.
My hon. Friend the Member for Huddersfield complained that this is a classic example of where many Departments are responsible for a particular issue. It is not unique: yesterday we were discussing a number of complex issues involving the tragic circumstances in Morecambe bay and the practices of gangmasters. I know from the experience within our Department that making progress on those issues is not always straightforward because the questions involve and impinge on the responsibilities of a number of Departments.
The Waste and Emissions Trading Act 2003, which was granted Royal Assent in November, provides for a unique system of tradable landfill allowances for waste disposal authorities across the UK. The system, known as the landfill allowance trading scheme, is intended to help England to meet the targets set by the 1999 landfill directive to reduce the amount of biodegradable municipal waste we send to landfill. This is one element
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of DEFRA's waste implementation programme, which is rolling out a number of initiatives recommended in the strategy unit report. Others include waste minimisation programmes and the expansion of home composting.
We are also providing support to develop new infrastructure for recycling and associated education programmes. We are improving our data and carrying out research on waste management to provide a sound evidence base for policy development, implementation and monitoring. We are introducing incentives to encourage the take-up of alternative technologies for waste treatment. The programme team is working with local authorities and stakeholders across the whole supply chain. A high-level steering board, which brings together senior figures from industry, local government and central Government, and retailers, has also been established to drive forward the implementation of the programme.
Further measures announced in the Government's response to the strategy unit report include a commitment to raise landfill tax by £3 per tonne in 2005–06, and at least £3 per tonne in each year thereafter, up to £35 per tonne. The Government have established a hazardous waste forum, and we are introducing regulations under the EU animal by-products regulation, setting out rules for composting catering waste. As hon. Members will be aware, the Government have increased the environment, protective and cultural services block funding to local authorities, part of which is for waste management. The increase announced at the last spending review was 1.3 per cent. per year, in real terms.
Miss McIntosh: We are all most grateful that the Minister has been able to respond to this debate. Is he able to give us a global view on what the Government's priorities are? Do they intend to show the political will to respond to the industry's needs, to comply with the EU directives, or rather set up another quango and more bureaucracy?
Mr. Bradshaw: I shall get on to that in a moment. The Government are interested in policies and structures that work and that contribute to the amelioration of this very serious problem. The fact that we have made it one of our six strategic objectives is significant, as is the fact that we are investing ever more extra resources in this issue. I shall come on to the structural question shortly.
The Government also recently announced a £20 million extra grant for 2004–05 to help with some spending pressures arising from waste management for local authorities. Linked to these central-local government relationships is DEFRA's work with the ODPM, including work on the development of the planning system. Enabling adequate and timely provision of waste management facilities will become even more important as the demand for such facilities increases. My Department is closely involved in the revision of PPG10—the planning policy guidance note that sets out national planning policy on waste management. The revision is part of the Government's drive to streamline planning policy to give greater clarity in terms of the outcomes to be achieved. The ODPM expects to consult on a draft of the new planning policy statement in the first half of this year.

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The DTI, which leads on the implementation of the waste electrical and electronic equipment and end of life vehicles directives, and DEFRA, which works with it on the implementation of these directives, are committed to a more cross-Whitehall project team approach. Both have dedicated project teams and interdepartmental advisory groups, with the body of best practice starting to grow.
I turn now to the question of the overall responsibility for waste, in response to the strategy unit report. The Cabinet Office was commissioned by DEFRA to carry out an internal review of existing arrangements and consider the scope for improving the co-ordination of interdepartmental responsibilities for waste policy. A limited consultation was undertaken with interested parties, and the review will consider the views of all the respondents. That means not just a single person—quite a lot of respondents made the same point as my hon. Friend the Member for Southampton, Test. The strategic waste forum's proposals for a strategic waste authority will be considered, alongside all the other responses. The review began in December, is well under way and will conclude in the spring. I am not sure of the reasons for the delay, but I will happily find out and inform my hon. Friend.
Mr. Sheerman: It is very important that we also get the planning guidance. What is the ETA on that?
Mr. Bradshaw: I am afraid I do not know, but again, I will find out and write to my hon. Friend.
I listened with interest to the vision outlined by my hon. Friend the Member for Southampton, Test detailing how he envisages such a strategic body would work. As he explained that, I was thinking about the review going on within and outside our Department, under Lord Haskins, and the recommendations he has made. Some points that he made about the value of separating policy from delivery and having a single strategic body consider a particular policy had considerable weight. As I said at the beginning of the debate, I am not an expert on the matter, but I shall certainly take those points back to my hon. Friend the Minister for the Environment, who leads on the issue.
The hon. Member for Vale of York slightly jumped the gun by assuming that there are already plans to set up such an authority. She even talked about an amount
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of money. We have not got that far yet. We are still waiting for the report on the work of the Cabinet Office committee—perhaps she knows more than I do.
Miss McIntosh: To satisfy the hon. Gentleman's curiosity, the source of the figure is the excellent House of Commons Library note, in which I discovered that the Government have confirmed that the amount of £1.5 million will be available. Perhaps it illustrates lack of joined-up government if his Department does not know where that is coming from.
Mr. Bradshaw: The Cabinet Office is reviewing the responsibilities for waste generally. It is considering proposals from others as part of its review. The £1.5 million referred to is the additional administrative resource that DEFRA is contributing to the establishment of the waste implementation programme to help local authorities to meet their landfill directive targets. I hope that that is helpful to the hon. Lady.
Dr. Whitehead: Will my hon. Friend underline the fact that if a strategic waste authority came into being it is precisely such programmes that would be subsumed within it, rather than it being an additional expense, with new staff and costs?
Mr. Bradshaw: I take that point, but I was going on to say that whatever the view one takes of my hon. Friend's suggestion for a strategic waste authority—my hon. Friend the Minister for the Environment is open to persuasion on the matter—there would still have to be an interface with other Departments, devolved Administrations and external stakeholders.
It is often difficult to know where the boundary lies between products and waste, and the priority for our Department is to ensure that these relationships are forged and reinforced now and maintained in the future. The way in which we work could, without exaggeration, be described as already acting as a virtual strategic waste authority. It may not work perfectly, as several hon. Members have said—[Interruption.] My hon. Friend the Member for Huddersfield is laughing at the notion of a virtual authority, but I think he is being unkind.
I would also suggest that the significant increase in resources that my Department has dedicated to waste is one element helping to ensure that relationships are improved. I am grateful to my hon. Friend the Member for Southampton, Test for raising the topic for debate. We have sympathy in the Department for the aims of his proposal, and we await the outcome of the Cabinet Office review with great interest.

Duchenne Muscular Dystrophy
3.28 pm
Kevin Brennan: This is the second time that I have secured an Adjournment debate on the issue of research into treatments and a possible cure for Duchenne muscular dystrophy, but I make no apology for returning to the subject for a second time in the Chamber. I do so not only because this is a terrible disease of which people know little, and which many have never heard of, although it is of a similar prevalence to better known conditions such as cystic fibrosis, but because I believe, as do many of the young people and parents who are affected by the disease, that for the first time in many years there is genuine hope of an effective treatment, and perhaps even a cure. More importantly, that belief is shared by many eminent scientists working in the field, to the extent that they are setting aside their traditional differences and, in many cases, their individual pursuits, to pull together and to pool their efforts to find a treatment and perhaps eventually a cure for Duchenne muscular dystrophy. Perhaps the only thing that they lack is adequate resources for undertaking the necessary research to unlock the prize of a treatment and eventual cure for the disease.
Duchenne muscular dystrophy is the result of a gene defect that causes the body not to produce a vital substance called dystrophin. Without that substance, muscle cells become weaker and gradually waste away. The condition is regarded, wrongly, as relatively rare. In fact, it affects about one in every 3,000 boys throughout the world, although there is some dispute about the exact figure. In other words, every Member is likely to have constituents who are affected by this disease. I certainly have such constituents. This is a very cruel disease —if it is appropriate to attribute a human trait to the result of a genetic lottery.
Most parents who are affected believe that they have a healthy baby son, as any normal parent would, until the symptoms begin to emerge when the child is a toddler. I say "most" because a test, which is now carried out routinely in Wales, can inform parents of the presence of the disease while the child is still an infant. That can be very important, because parents may want that information if they are planning to have more children. The test may help them to take decisions about their family in future.
Whenever the diagnosis is made, the result is the same. Boys with Duchenne muscular dystrophy can expect to be wheelchair-bound by the age of 11 and to become progressively more disabled throughout their teens as their muscles gradually waste away. At this stage of their lives, the availability of the latest high-tech wheelchairs can have a huge impact. Many of these boys are high achievers in school and do very well in their studies if they have the right support. According to parents to whom I have spoken, however, the availability of such wheelchairs varies greatly throughout the country. I ask the Minister to look into that issue.
In their final years, young men with Duchenne muscular dystrophy will require 24-hour care, night-time ventilation and feeding support. Although improved ventilation helps to extend life, the disease is
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fatal. Young adults are likely to die in their early 20s as a result of heart or lung failure as the vital organs become too weak to sustain life.
The disease is often hereditary, but it can also occur by spontaneous mutation, so even very careful genetic screening could not eradicate it completely. My interest in the disease arose when my constituents, Nick and Janet Caplin, brought their son Saul to my surgery a couple of years ago. It was very hard to believe that the lively toddler whom they brought to see me had, as they put it, a death sentence on his head. Nevertheless, he had been diagnosed with the disease, and Nick and Janet helped to set up a charity, Parent Project UK, to campaign with other parents and families affected by the disease for even more research into treatments and eventually a cure. They have now moved out of Cardiff, West, and it is a testimony to both the closeness of the parental network of Duchenne muscular dystrophy sufferers and its prevalence, which makes my point that the disease is not that rare, that their home was bought by another couple from Cardiff, West, Lisa and Gareth, whose son loan also has Duchenne muscular dystrophy. This is an extremely poignant week for that family, because it is the first anniversary of Ioan's diagnosis, which was made through the screening to which I have referred.
No one could fail to be moved and inspired by the courage and humanity of couples such as Nick and Janet and Lisa and Gareth, and of many other families whom I have met through my interest in this terrible disease. Sympathy is not enough, particularly now that the scientists are telling us that new developments offer hope for sufferers of Duchenne muscular dystrophy. Since the previous debate on the subject, Parent Project UK, the Muscular Dystrophy Campaign and the Duchenne Family Support Group, the three main charities with an interest in the condition, have got their act together and joined forces to act as a catalyst for more research to be undertaken into the disease. It is highly commendable that they have pulled together to try to make progress and to maximise the synergy that they can obtain from working together.
Last September, a group of us met Lord Warner at the Department of Health. I went along as chair of the all-party group on muscular dystrophy, which was set up as a result of my meeting with Nick and Janet. It was a fruitful meeting and an exciting research proposal was put together. There was a fairly stiff deadline, and I pay particular tribute to Jenny Versnel of the Muscular Dystrophy Campaign for her work in burning the midnight oil to submit the proposal by the deadline. The proposal was put together to bid for £2.5 million of funds that were set aside and earmarked in the Department of Health's commendable genetics White Paper. which was published last year. It is also commendable that the money was set aside specifically for research into single-gene disorders such as Duchenne muscular dystrophy.
I understand that the bid is under consideration and that it is going through peer review, so the Minister is probably limited in what he can say about it at this time because it will be considered with all the other bids for that money. Before a final decision is taken. I want to emphasise to him what a successful bid would mean to the morale of families affected by Duchenne muscular

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dystrophy, as well as of the scientists who formed the consortium, joining together centres of excellence from around the United Kingdom.
Let me illustrate the calibre of some of the people involved who are champing at the bit to get on with the research project. The project will be overseen and managed by the highly regarded Professor Kay Davies at the university of Oxford, and individual parts of the research will be undertaken by Professor Francesco Muntoni at Hammersmith hospital; Professor Kate Bushby at Newcastle medical centre; Dr. Qi Lu at Imperial college, London, who is a tenured member of the research staff of the Medical Research Council; Dr. Dominic Wells, reader at Imperial college, London; Professor George Dickon at Royal Holloway college, London, with Dr. Ian Graham of the same institution; Dr. Matthew Wood, also at the university of Oxford; and Jenny Versnel, whom I mentioned earlier, the head of research at the Muscular Dystrophy Campaign. Many of those eminent researchers came to a conference organised by Parent Project UK and the Muscular Dystrophy Campaign in the autumn, which I attended.
Recently, Professor Terry Partridge of Imperial college, who is also part of the consortium, came to the House of Commons to address the all-party muscular dystrophy group. At that meeting, at which many parents of boys affected by Duchenne were present, he said that he was usually extremely cautious about raising hope, particularly with regard to something like Duchenne muscular dystrophy, because it would be cruel to raise anybody's hope about a certain piece of research. However, he saw real promise in the approach suggested in this research proposal, perhaps for the first time ever.
I want to outline what the research proposal involves. In recent years, studies undertaken in mice and on human cells in the laboratory have shown that it is possible to produce a sort of molecular patch that could enable dystrophin to be produced in muscle cells, which would modify the form of muscular dystrophy suffered by the boys. If the technique were successful —all the evidence from the laboratory and the experiments involving mice suggest that it could work and is promising—it would modify Duchenne muscular dystrophy into the much less serious Becker form, which would considerably lessen the symptoms, because in the Becker form of muscular dystrophy some dystrophin is produced. The quality and length of life of boys suffering from Duchenne muscular dystrophy would therefore be greatly enhanced. The scientists believe that up to 60 per cent. of Duchenne muscular dystrophy sufferers could benefit from the treatment.
The principle has been established, but the scientists need the financial support to advance the research to human trials. The project submitted to the Department of Health would do the following: first, it would improve the design of the molecular patches; secondly, it would find the best delivery techniques to the muscles; thirdly, it would do further tests in animals and Duchenne muscular dystrophy human cells in the laboratory; and, fourthly, it would carry out the first human safety trials and see whether functional dystrophin is produced by that technique.
For those involved in Duchenne muscular dystrophy, including parents and researchers, this is the first flicker of light at the end of a long and dark tunnel. The
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possibilities of genetic research to do good, correctly identified in the Government's White Paper last year and too often overshadowed by media scare stories about cloning and so on, give hope where before there was only despair, but I cannot emphasise enough the need for that hope to be kindled.
To giant pharmaceutical companies, Duchenne muscular dystrophy is a rare disease, because their definition of rarity is anything that is unlikely to yield an easy profit. That is why it is so vital that the Government, through Department of Health White Paper money and the Medical Research Council, support this vital work. The scientists to whom I have spoken are convinced that the project will have spin-offs in other areas and for other genetic disorders.
This is not the only line of research. We believe that £20 million should be spent over the next few years to support other promising research projects in this area too. However, this £2.5 million is on the shelf, ready to run, and it is backed up by all the charities and the all-party group, and has 18 of the nation's top scientists ready to carry it out. I believe that it deserves to be funded in full.
Finally, I hope that the Minister will ask the Secretary of State to make time in the near future to meet the families of boys with Duchenne muscular dystrophy, as his colleague Lord Warner did last September, so that he can hear their stories, listen to their concerns, understand their plight and, most importantly, do whatever he can to help them.
3.45 pm
The Parliamentary Under-Secretary of State for Health (Dr. Stephen Ladyman): I begin, as always, by commending my hon. Friend the Member for Cardiff, West (Kevin Brennan) on securing the debate. Those congratulations are well deserved. As he said, he has raised the subject before, has remained close to it in recent years and continues to work hard to press the Government on it. I welcome the opportunity to bring him up to date on the state of the issues raised.
My hon. Friend asked whether the Secretary of State would meet the families of children with Duchenne muscular dystrophy. I have no doubt that he would be happy to do so. He meets people who suffer from all manner of long-term conditions. However, he needs no convincing of the importance of the issue. That is why he was so enthusiastic about launching the Government's genetics White Paper. He is committed to doing everything that we can to deliver aid, support and, where possible, cures for such distressing illnesses. This is a distressing condition. As my hon. Friend said, boys with this genetic disorder have a very limited life span.
Voluntary organisations active in the area, such as the Muscular Dystrophy Campaign, Parent Project UK and the Duchenne Family Support Group, should also be congratulated on their work. It is important to raise public awareness of that dreadful disease and I hope that initiatives such as "The Right to Survive" will help to achieve that objective. I know that my hon. Friend will continue to do everything he can to ensure that people are aware of the issues involved.
As my hon. Friend said, Duchenne muscular dystrophy is an inherited severe and progressive muscle wasting disease. It is estimated that about 100 boys with

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Duchenne muscular dystrophy are born in the United Kingdom each year and that about 1,500 known boys with the disorder are living in the UK at any one time. It affects around one in 3,500 male births every year. It is caused by a genetic disorder characterised by progressive weakness and degeneration of the skeletal or voluntary muscles that control movement. Most boys with the disease will be in a wheelchair by the age of 10.
My hon. Friend will be pleased to know that among other things in my portfolio is responsibility for community equipment, including the wheelchair service. I heard what he said and am aware of the patchiness of the wheelchair service around the country. I assure him that I am already looking into that and trying to devise ways to improve it. I hope that he will pass that message back to the parents and the boys themselves.
Tragically, there is no effective cure or treatment for Duchenne. I understand, therefore, why the families of patients with Duchenne muscular dystrophy call for a greater research effort to be applied. Indeed, the Government are committed to investing money in genetic research.
Genetics offers enormous potential to improve our health and health care. Increasing understanding of genetics will bring more accurate diagnosis, more personalised prediction of risk, and more targeted and effective use of existing drugs. It will give us new gene-based drugs and therapies as well as prevention and treatment regimes tailored according to a person's individual genetic profile.
Unfortunately, market forces tend to militate against industry funding trials for rare disorders and inherited disorders. None the less, there remains an unmet need for effective, less burdensome treatments, and an estimated 750,000 patients in the UK suffer from incurable single-gene disorders. Gene therapy offers hope for those people and, to address that, the Department of Health supports gene therapy research into single-gene disorders.
As with any medical research, it is not possible to predict accurately when such treatments might become available or which approaches will ultimately prove effective. That is the nature of research. However, I share the hopes of the many parents, carers and patients that gene therapy will become a viable treatment for inherited disorders such as DMD, although we should not build up expectations and must realistically expect those outcomes to be a decade or more away.
I am aware that researchers have submitted a bid for funding for Duchenne muscular dystrophy research, the bid that my hon. Friend so eloquently described. He is right; I am not in a position to announce whether that bid has been successful. All I can tell the House is that the commissioning group for gene therapy research has met and considered the proposals. The outcome of the commissioning group's deliberations must remain confidential until the funding for each successful applicant has been agreed, and that has not yet been achieved.
My hon. Friend will recall that in April 2001 we announced £30 million to develop specialised genetic services. We have made further funding available for
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this important area. In June 2003, the White Paper "Our Inheritance, Our Future —realising the potential of genetics in the NHS" set out the Government's commitment to developing genetics knowledge, skills and provision within the NHS by investing more than £50 million over the next three years.
Kevin Brennan: I understand that the Minister is unable to discuss the outcome of the deliberations on the applications, but is he able to give any idea when the announcement might be expected on the final outcome?
Dr. Ladyman: I cannot give a precise date, but it is relatively imminent—weeks rather than months.
The White Paper details the following commitments: £3.5 million to fund 90 new grade A trainees in laboratory genetics and the equivalent of 10 full-time trainer posts; up to £18 million capital to upgrade NHS laboratory facilities in England; up to £1 million in information technology for genetics laboratories in the genetics testing network; £2 million of start-up funding over three years for other initiatives to bring the benefits of genetics to mainstream clinical areas; up to £2 million of start-up funding over three years specifically for primary care genetics initiatives; £4 million to fund pharmacogenetic research on existing medicines; £500,000 to pilot near-patient genetic testing in the NHS; £1.5 million to fund a range of research projects in the area of genetics-based health services; £3 million to support gene therapy research on single-gene disorders; £2.5 million for cystic fibrosis gene therapy research; and £4 million to provide access to clinical grade gene therapy vectors.
The emphasis for Department of Health funding is "translational", which means bringing the benefits of research to the clinic. Our vision is for the NHS to lead the world in taking maximum advantage of the safe, effective and ethical application of the new genetic knowledge and technologies for all patients as soon as they become available. In time, we should be able to assess the risk that an individual has of developing disease not just for single-gene disorders such as DMD and cystic fibrosis, but for our country's biggest killers—cancer and coronary heart disease—as well as those, such as diabetes, that limit people's lives.
The potential in genetic research is immense. While genetics will never mean a disease-free existence, greater understanding of genetics is one of our best allies in the war against disease. I hope that, over time, research will provide a breakthrough in the understanding and treatment of genetic diseases such as DMD.
The main agency through which the Government support medical and clinical research is the Medical Research Council. That independent body receives its grant-in-aid from the Office of Science and Technology. It is, however, a long-standing and important principle of successive Governments that they do not prescribe to individual research councils how they should distribute resources between competing priorities. That is best decided by researchers and research users.
The MRC spend relevant to DMD research for 2001–02 was around £2 million. That included two major groups of researchers: those of Professor Kay Davies at the MRC functional genetics unit in Oxford and Professor Terry Partridge at the MRC clinical

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sciences centre based at Imperial college in Hammersmith. Research projects are also being carried out on muscular dystrophy and basic underpinning work that could apply to all forms of the disease. The MRC does not, as a rule, earmark funds for particular topics; research proposals in all areas compete for funding. When appropriate, high-quality research in the areas that we are promoting may be given priority in competition for funds, but research excellence and importance to health will continue to be the primary considerations in funding decisions. In addition, it is important to note that while prevalence of a particular condition is one important factor, the MRC's funding decisions are set largely on the scientific opportunity and the likelihood of significant development.
There are, of course, other lines of research that may help in the future, especially with long-term conditions. The report by the chief medical officer's expert group, "Stem Cell Research: Medical Progress with Responsibility", was published in 2000. This recognised that the early research on stem cells is exciting and provides a real hope of new treatments becoming available in a few years for people with chronic diseases.
The Government are investing an additional £40 million in stem cell research in 2004 to 2006. We believe that stem cell research offers enormous potential to deliver new treatments for many diseases for which there are no effective cures. The Government are therefore funding the creation of a national stem cell bank. The first of its kind in the world, it will hold all types of stem cell as a resource for researchers. The Science and Technology Committee, in its recent report on the work of the Medical Research Council, welcomed the stem cell bank and called it
"a world leading venture that we wholeheartedly support."
The Government want research to use all sources of stem cells, including embryonic stem cells. It is far too early to know where useful results will come from. That position is supported by published scientific findings. Any activity that involves the use or creation of an
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embryo outside the body—be it for treatment of infertility or for research—is permitted in the UK only under a strict system of licensing by the Human Fertilisation and Embryology Authority.
In February 2001 we announced the development of a national service framework for long-term conditions. NSFs are set out in the White Paper, "The new NHS". They are intended to set national standards and define service models for particular services or care groups. This NSF will have a particular focus on the needs of people with neurological conditions and brain and spinal injury. We are also clear, however, about the fact that it must tackle some generic issues that affect a wide range of people with long-term conditions and their families and carers. We hope that work to establish standards for neurological conditions will provide patterns of service provision that have wider application and will also benefit people with non-neurological conditions.
I hope that my hon. Friend agrees that the Government are sympathetic to the needs of patients with Duchenne muscular dystrophy and other longterm conditions and that we are backing that sympathy with real effort and resource. There has been progress since we last debated the subject. The initiatives I have described—the genetics strategy, the important work under way in the research field, developments in stem cell research and the national service framework—will help to make life better for patients with Duchenne muscular dystrophy, their families and their carers.
I am sorry that I cannot give my hon. Friend the answers that he wants on the the exciting research project that he described, but I hope that we have them for him soon. I certainly assure him, the parents and all sufferers with Duchenne muscular dystrophy that the Government have every sympathy and want to do everything they can to help them, both with the services that make their lives better and with the research to ensure that there are effective therapies in the not too distant future.

Media Intellectual Property Rights
3.58 pm
Tom Brake: I am aware that in the next minute or so we are due to have a Division, so I hesitate to embark on the meat of what I am here to say. I welcome the opportunity for this debate. What was most interesting as I drafted my speech was the fact that though I have held many debates in Westminster Hall over the past seven years on a whole range of constituency issues—local train services, local hospital provision and so on—no issue has ever seen me receive as many approaches from different organisations as this one. The issue is clearly of interest to the media, so one would expect them to pick up on it and contact hon. Members seeking to raise it in Parliament. However, intellectual property rights are also a hot topic for the industry as a whole, which is why I have been contacted.
I told the Minister that the main purpose of this debate is to raise an issue that a constituent has brought to my attention. However, because a number of organisations that are concerned about such matters as counterfeiting have made approaches to me, I seek to raise some more general industry issues. I apologise if he has not had much notice of that and shall quite understand if he needs to respond to me in writing on those issues at a later date.
4.1 pm
Sitting suspended for a Division in the House.
4.14 pm
On resuming—
Tom Brake: There are a number of general issues that I shall raise, but in the first part of what I say I shall focus on one constituent's case. I am going to describe it as Alan Brunwin v. Chatsworth Television's "Busy Buses" children's programme. In 1988–89, my constituent wrote a series of children's stories called "Hoppy the Hopper Bus". He sent his work to, he estimates, about 40 television production companies to try to get it animated for television. He also let a number of local people—myself included—see copies of it, with copies of the bus characters that he had devised for the proposed animation. One of the people to whom he had shown his stories told him in February last year that they were being screened on Living TV under the name "Busy Buses".
Having seen pictures on Chatsworth's website and compared them with pictures that Mr. Brunwin has drawn of his bus characters, I can say that there are clear similarities. He says that a large number of people in the media knew of his work, given that he had circulated it widely. On learning that it was being broadcast on Living TV, he wrote to the channel immediately, and it replied saying that the stories had nothing to do with it, and that he should talk to Chatsworth TV about the matter, which he did the following day.
Mr. Swan, who is Chatsworth Television's solicitor, made contact with Mr. Brunwin allegedly saying that he did not represent Mr. Terry Ward, who is the writer and creator of the "Busy Buses" programme and a company
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director of Chatsworth Television. The solicitor asked my constituent to send him proof that Chatsworth Television had copied his work. Apparently, three hours after this contact was made, Mr. Ward made contact with my constituent and informed him that the solicitor had contacted him, and he then told my constituent that he had no more to say on the matter. The solicitor told my constituent in that initial contact that he had no relationship with Mr. Ward, but within a matter of hours it was confirmed that he did. Because of that fact, my constituent does not feel able to trust that company.
Subsequently, Mr. Brunwin sent a number of e-mails demonstrating what he believes to be sufficient proof that he had the idea several years ago, and that there are clear similarities between his work and that of the "Busy Buses" programme. He received frequent replies from Mr. Swan, but they stressed that there was insufficient evidence and that the only point at which the company would engage in further discussions with my constituent would be if he employed a solicitor to take up his case—something that he is not in a position to do. Mr. Swan and Chatsworth Television then told him that they would have no further contact with him.
Mr. Brunwin also had concerns about the BBC's involvement in the case, stating that one of the 40 recipients of his proposal was a BBC producer, but the BBC said that it had no knowledge of the proposal. However, he has found that BBC Worldwide sells "Busy Buses" books and DVDs all over the world. He raised the matter with the then director-general, Greg Dyke, in August 2003, and was apparently told that an investigation would be carried out into his claims, but apart from a telephone call from the director-general's office asking whether the BBC had been in touch with him—to which the answer was no—there has been no further progress on that matter. No doubt that will be one of the tasks that the new director-general will have to take on.
My constituent has tried to initiate contact with Chatsworth Television, but it seems his e-mails are going into a black hole. He has set up a website called "Justice for Hoppy", in which he sets out his version of events and challenges the company to take issue with it if it disagrees with the content. It is worth noting that it is alleged that last year Mr. Ward, the director of "Busy Buses", sent him an e-mail, saying:
"I hope we can sort this matter out amicably."
My constituent has interpreted that as a concession on Chatsworth TV's part that it had prior knowledge. Otherwise, why would it respond in that way, given that most of the contact had been simply to rebuff him?
It is clear from the description that I have given that this case can be resolved only in court, as there are allegations and counter-allegations. I believe that my constituent would welcome that, because he feels that it is the only way in which the matter can be sorted out.
What options are available to ensure that such altercations do not arise, and that if people develop an idea, they maintain rights over it? I want to quote, first, from issue 8 of Media Magazine. I am indebted to Sean Egan, the writer, who has set out what actions he thinks writers can take to ensure that they maintain rights over an idea that they have developed. My constituent's case seems to fall neatly into the description that he gives of an

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"aggrieved writer, having submitted material to a broadcaster or producer on a speculative basis and having heard nothing or been rejected, finds that a television show is broadcast by the same company"—
there is a problem about being able to make a clear link between Chatsworth TV and the material sent out by my constituent, but a link could possibly be made through third parties—
"which is similar to, or at least bears a strong resemblance to, the writer's original material."
There follow a number of tips that people should seriously consider, such as registering the material in one form or another or putting their name on the cover page. Mr. Egan also suggests that they should try to enter into a confidentiality agreement when they enter into correspondence with possible broadcasters or producers. If they cannot do that, letters should be clearly marked "In confidence". They should keep an accurate record of when the material was started, when it was sent out and whom it was sent out to, and should ensure that it is as detailed as possible. There are measures that people can take to reduce the risk of such disputes occurring, although it is not clear whether they would be sufficient to stop a dispute of this kind.
That is the main focus of what I want to say, but as I said before the Division, other industry issues involving intellectual property rights have been drawn to my attention that I want to touch on briefly, including counterfeiting, the ownership of formats and the power relationship between large corporations such as the BBC and small independent producers. In some ways that last point mirrors what my constituent alleges happened to him, where someone with more clout took over his idea. That is what independent producers say happens in relation to the BBC.
Those issues may have been addressed by the Communications Act 2003, and I should be grateful if the Minister said today or later whether he believes that the core principles of the code of practice are working well. They include

"that a reasonable timetable is applied to negotiations…

that there is sufficient clarity…about the different categories of rights to broadcast…

that there is sufficient transparency about the amounts to be paid in respect of each category of rights".

There are a number of matters running from (a) to (g) in the code of practice that need to be addressed. We need to know whether the feedback that the Minister is getting from the industry confirms whether the code is up and running and working well.
It could be argued that the idea proposed by my constituent might fall into the category of a format. Typically, however, programmes such as "I'm a Celebrity, Get Me out of Here!", which are described as format programmes, can be transferred to another country in a very similar format or production. It would be interesting to find out the Government's thinking on the issue, particularly as the UK industry producing such programmes is very strong. The matter clearly has very significant financial implications for the industry.
Others have looked at the matter. The Minister may be aware of a speech given by Dr. Miriam Meckel, Permanent Under-Secretary for Europe, International
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Affairs and Media in the state of North Rhine-Westphalia in Germany. I will forgive him if he is not. In her speech, she gave a definition of a format as
"the core idea of a programme, the main framework and structure and all the characteristic features that make a show what it is."
She believes that the way to solve the problem is to
"hand the matter over to the European Union. This would ensure both that the issue was finally addressed and a solution found, and that the legislation would be uniform across Europe. Individual reforms in each country would only lead to an array of different rules and regulations which could leave some countries at a serious disadvantage."
I hope that the Minister will be able to clarify whether her strategy is a way forward for formats.
The idea of Europe as the way forward is not necessarily a commonly held view in the industry. One of the organisations that contacted me prior to the debate was the Alliance Against Counterfeiting and Piracy. It is quite concerned about the negotiations of the draft EU copyright enforcement directive, about which I knew nothing until about 12 hours ago. It is particularly concerned that the directive will leave UK businesses exposed and that it will impact negatively on their ability to protect intellectual property.
The alliance has three specific concerns: the proposals will hamper the ability of UK businesses to take appropriate action against intermediaries found to be infringing intellectual property rights; the proposal for intermediaries to be entitled to claim for compensation is an issue, given that that is already permitted under civil procedure rules; and the proposal to eliminate a rights holder's ability to seek double damages from an infringer seems dubious. Its view is that the penalties for counterfeiting are not sufficient and must be made much tougher, but it is worried that they will not be. Its concerns are exacerbated by the 12 accession states, which may not have the same regard for intellectual property rights as the existing EU members. I would appreciate either a written or a verbal response to those concerns.
There is no doubt that copyright law needs to catch up with the 21st century. A lot of business is about ideas rather than concrete designs and new inventions. To promote potential UK creative talent, we must clarify copyright law and we must safeguard and enforce intellectual property rights. In that way we could avoid controversies such as those generated by the "Busy Buses" programme. I hope that the Minister will be able to explain how that can be done.
4.30 pm
The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms): I congratulate the hon. Member for Carshalton and Wallington (Tom Brake) on securing the debate, which raises some important issues and the particular concern of his constituent, as he explained. The Government are acutely aware of the need for effective protection of intellectual property rights in material created for and exploited in the media nationally and internationally.
It is also important that that protection should be balanced with the interests of others in society, whether from the perspective of freedom for users of protected

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material to make reasonable use of it for purposes of reporting, education, study and so on, or from that of enabling legitimate competition, or for other reasons. That balance has to be maintained in the Government's approach.
The most important form of protection in relation to the media is copyright. There are ever more challenges to the protection of intellectual property with the advances in digital technology in recent years, particularly through the internet. The hon. Gentleman is right to draw attention to the scale of the new issues that arise as a result of its spread, but provided that intellectual property protection keeps pace with technology development, the new and emerging environments also provide new opportunities for creators and producers to exploit and benefit from their material.
UK copyright law, as enshrined in the Copyright, Designs and Patents Act 1988, was already relatively well adapted to meet many of the challenges of technology. Of course, much has changed since 1988 and it is now the case—as the hon. Gentleman mentioned—that UK copyright law, like that elsewhere in the European Union, is strongly influenced by EU legislation. Since 1992 there have been seven directives in this field.
The most recent directive on copyright in the information society was implemented in the UK last October. It strengthens the protection of copyright in the digital environment. In particular, although the original UK legislation already gave rights owners extensive rights to control electronic dissemination of their material, the directive has required an amendment to the law to make those rights more clear and comprehensive.
The internet and services that deliver material on demand to consumers are important. The directive means that rights owners now have greater legal redress against those who seek to defeat technological measures such as copy-preventing devices. Rights owners need to be able to use such devices to protect their property, given the possibilities for unlimited copying and dissemination that modern technology affords.
The directive also provides for a number of exceptions to rights in areas where limited use of copy right material without permission should be permissible. The need for an essential balance between the interests of rights holders and the users of copyright material has been recognised for a long time in UK law. We have welcomed the recognition of that balance in the copyright directive and as far as possible we have preserved existing exceptions in the new regulations.
Last year we brought into force two new exceptions to copyright specifically designed to benefit visually impaired people who have difficulty reading copyright material in the form in which it is produced. Those new exceptions mean that difficulties and delays in obtaining copyright clearances will no longer be a bar to the production of much-needed alternative formats of copyright material, such as Braille or audiotape, by organisations such as the Royal National Institute of the Blind and the National Library for the Blind.
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I do not make those points because they are specifically relevant to the case of the hon. Gentleman's constituent, but it is useful to place those concerns in the context of the recent changes to the law, because they illustrate our commitment to ensuring that rights are kept up to date, that they are enforceable and that their scope is balanced against the interests of others in society. That is particularly relevant in ensuring that copyright law continues to be balanced against the need to permit appropriate competition.
On the case that has been drawn to hon. Members' attention today, I need to make the point that copyright does not protect ideas as such. Such protection could be seriously anti-competitive. Many of the new programmes on television, and new ways of presenting material more generally in the media, might not have been possible if copyright protection had extended to an idea. For example, the idea of a cartoon based around characters of a certain broad type is not protected by rights that would prevent others from producing a different cartoon based around the same type of characters, and in our view it should not be so protected. The idea of a children's cartoon involving buses with faces is not protected by copyright any more than the idea of a book about trains with faces is protected by copyright.
Were copyright to protect such ideas, we probably would not have been able to enjoy both Warners' Daffy Duck and Disney's Donald Duck, or Warners' Sylvester and MGM's Tom. Creativity has always been inspired by what has gone before, and always will be. The cycle ultimately benefits us all by leading to a richer range of new media and other creative products, as those examples amply illustrate.
Tom Brake: My constituent's allegation is not so much that he had an idea, but that he had story lines, pictures and characters, and therefore that he had something with much more content to it than an idea.
Mr. Timms: I accept that point entirely. Copyright certainly does provide protection for sufficiently elaborated original expressions of ideas. A fully developed cartoon involving buses with faces that has not been copied from someone else is likely to be a copyright work that attracts all the rights granted to copyright owners, which enable the owner to act against those who copy that protected work without permission.
Copyright is infringed only if one person has copied from another's work. It is perfectly possible for two people working completely independently to create very similar cartoons. In that case, both could attract copyright protection and the creation of neither one would infringe the rights relating to the other. In the case that we have been considering this afternoon, it would be necessary to show that the cartoon known as "Busy Buses" copies at least a substantial part of the "Hoppy the Hopper Bus" series. Not only is it necessary to show that "Busy Buses" incorporates material that is the same as at least a substantial part of "Hoppy the Hopper Bus", but it has to be shown that that is the result of copying rather than independent creation. It is for the person alleging infringement of copyright to prove both those things. As the hon. Gentleman said,

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that would need to be done in the courts, where the burden of proof is that the evidence must show those things to be true on the balance of probabilities.
I have explained that copyright protection for media ideas is not appropriate, given the anti-competitive effect, but when someone has come up with a new idea
that is not yet in the public domain, it is possible—the hon. Gentleman mentioned this point—to use the protection arising from the law of confidence to have a right of action against those who pass the idea on to others without permission. In this case, I think that it is too late, but it may be helpful for others to be reminded that they could agree non-disclosure on the ground of confidentiality with those to whom they disclose their new idea, when the idea is not yet in the public domain. A breach of that agreement could be pursued as a breach of confidence.
The hon. Gentleman raised more general issues. He is absolutely right that the dramatic and spectacular growth in use of the internet, which is continuing, poses new challenges for copyright law, and that we must ensure that the law keeps pace with the changes. Many companies already trade online successfully. We welcome very much the enthusiasm with which media companies use the internet to disseminate information widely and quickly. The UK's creative computer games industry is one of the strongest anywhere. The internet offers many opportunities for the content industry, and those opportunities will certainly develop further as broadband is increasingly used.
There are also threats to content industries from the development of the internet. A mature debate is needed about both the opportunities and the threats. I am aware of some issues that the hon. Gentleman raised—for example, the concerns about the EC draft directive on enforcement of intellectual property rights raised by the Alliance Against Counterfeiting and Piracy. Those concerns have informed our recent approach to negotiations on that proposal. We hope that an
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acceptable and workable solution on intermediaries and damages can be achieved as a result of those discussions. On the relationship between the BBC and independent producers, we hope that acceptable voluntary solutions can be found. We keep that matter closely under review.
The protection of formats is a difficult issue that has been examined in the past. It is not clear at this stage that further protection beyond that already available is needed. Again, we do not want to introduce legislation that would be seriously anti-competitive. However, we recognise that that issue also must be kept under review.
All content industries, including media interests, are concerned about illegal use of their material online. We are committed to effective enforcement of intellectual property rights and have taken several steps on that in recent years, including as part of the UK implementation of the copyright directive to which I referred improving the structure for enforcing rights. The protection given by intellectual property rights is an important part of the framework to encourage innovation and wealth creation, but rights that cannot be enforced are of no value.
Enforcement of rights must be pursued differently, depending on the circumstances. Lumping together commercial piracy on the one hand and private copying on the other is unlikely to be helpful in the longer term. Private downloading of material that has been put on the internet illegally is an infringement of rights, but it does not constitute a criminal offence. Efforts to increase the understanding of and respect for intellectual property rights, particularly copyright, is not helped by branding illegal downloaders as pirates. We must educate consumers about the downside of sharing copyright works over the internet, but we must not accuse them all of being criminals.
It being sixteen minutes to Five o'clock, the motion for the Adjournment of the sitting lapsed, without Question put.

CULTURE, MEDIA AND SPORT

  Community Radio
  The Secretary of State for Culture, Media and Sport(Tessa Jowell)
  I have today published a draft Community Radio Order, associated "Keeling Schedule" and explanatory memorandum for public consultation. Copies of these documents have been deposited in the House Libraries, and are available on the Department's website. The Department welcomes comments and the consultation period will last until 20 April 2004.

  This Order proposes to introduce a new tier of very local, not-for-profit (or not profit distributing) radio. Community radio should be different from, and complementary to, existing independent local radio. Community radio offers potential benefits in terms of social inclusion, local education, training and experience, and wider access for communities to broadcasting opportunities.

  The Communications Act provides for the possible establishment of a fund to support community radio.

  OFCOM will shortly be publishing their own draft guidance on how to apply for community radio licences.

DEPUTY PRIME MINISTER

  Fire and Rescue Authorities
  The Minister for Local Government, Regional Governance and Fire(Mr. Nick Raynsford)
  I have today made available copies of a consultation document on charging for services by Fire and Rescue Authorities in the Libraries of the House.

  Authorities already have a power under the Fire Services Act 1947 to charge for services other than fighting fires. The White Paper "Our Fire and Rescue Service" gave a commitment to continue to provide such a power and to consult on any proposals to extend the charging regime.

  Clause 19 of the Fire and Rescue Services Bill currently before this House provides for the Secretary of State to specify by Order the services for which an authority may levy a charge.

  The consultation document contains details of the services for which authorities in England and Wales currently levy a charge and these form the basis of our proposals. Comments are welcome on any part of our proposals. In particular, we welcome responses on the direction of travel in respect of the provision by authorities of detailed advice or consultancy.

  The consultation period will close on 7 May 2004.
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  Housing and Employment Mobility Service Contract
  The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister(Yvette Cooper)
  The Office of the Deputy Prime Minister is today announcing to the House that we are letting a contract to provide housing and employment mobility services.

  The principal objective for HEMS is to facilitate mobility—especially labour mobility for social housing tenants who want to move to other areas.

  HEMS will have three main service components. One—facilitated mobility services to social landlords and their tenants and applicants to help tenants and applicants to find new homes. This will continue and enhance the provision of the grant funded mobility services currently provided by Housing Mobility and Exchange Services (HOMES) and LAWN (the Association of London Government scheme that helps tenants who want to, move out of London to areas with excess housing). Two—web-based information about available housing, neighbourhoods and job vacancies. Three—web access to information on vacancies in social housing.

TREASURY

  Tax Avoidance
  The Paymaster General(Dawn Primarolo)
  Legislation to prevent tax avoidance through manipulation of partnership losses is to be included in the Finance Bill 2004. The legislation will apply to individuals who do not spend a significant amount of time in the partnership trade. For trading losses which arise in any of the first four years that a partner carries on a trade, relief for set-off against other income will be limited to the partner's financial contribution to the business. It will also ensure that where a partner claims trading losses against other income and then disposes of rights to future income, a charge to income tax arises on the disposal. The changes will have effect from today.

  A copy of today's Inland Revenue News Release giving the relevant background to this measure is being deposited in the Libraries of both Houses and is also accessible on the Inland Revenue website:http:// www.inlandrevenue.gov. uk/.

NORTHERN IRELAND

  Common Agricultural Policy Reform
  The Parliamentary Under-Secretary of State for Northern Ireland(Mr. Ian Pearson)
  The Department of Agriculture and Rural Development for Northern Ireland launched a major consultation exercise in September 2003 covering the choice of the main implementation options arising out of the CAP reform agreement reached in Luxembourg on 26 June 2003. The consultation ended on 16 January 2004 and after having considered stakeholder responses and the relative merits of the available choices, I have decided deploy the following options in Northern Ireland.

  Full decoupling of direct producer support will be implemented across the beef sheep and arable sectors.

  Full decoupling of direct producer support will be introduced in the diary sector from 2005.

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  The model of decoupling used will be a static vertical hybrid based partly on eligible land held in 2005 and partly on past patterns of individual producer subsidy claims.

  National envelopes will not be deployed at this point.

  Decisions on the use of the additional Rural Development Regulation options are deferred and will be considered as part of a separate consultation exercise on future modulation policy scheduled to commence in March 2004.

TRADE AND INDUSTRY

  Union Modernisation
  The Parliamentary Under-Secretary of State for Trade and Industry(Mr. Gerry Sutcliffe)
  Today, I tabled an amendment to the Employment Relations Bill concerning the provision of a new funding scheme. The amendment inserts a new section into the Trade Union and Labour Relations (Consolidation) Act 1992 which would create a power for the Secretary of State to make funds available to independent trade unions and federations of trade unions to modernise their operations.

  I envisage that the size of the fund would be in the region of £5 million—10 million in total, with expenditure spread over several years, probably beginning in 2005–06. The funding scheme would be used to support innovative projects in such areas as:
  training union representatives (for example in the area of business and people management) in order to help promote the development of high performance workplaces;
  reviewing internal union structures and organisation and to support more efficient management systems within unions;
  enabling unions to broaden their dialogue with members by greater use of the internet and other new technologies and to develop innovative and user-friendly voting mechanisms; and making union systems more accessible to young people and other under-represented groups within unions.

  The case for establishing a Fund is compelling. Unions—just like businesses—need targeted support to speed their adaptation to changing labour market trends and to new ways of working. Unions have done much to modernise themselves and several, often supported by the TUC, have made significant progress in that direction. However, as a number of representations from unions have confirmed, without assistance the pace of change will be slow. By encouraging unions to adapt more quickly, we will ensure that they play their full and considerable part in building productive relations at work that will benefit union members, other workers, their employers and the economy more generally.

  The fund will not therefore be used to support the day-to-day work of unions, and it will not impact directly on collective bargaining. It will not be used to support projects which could be funded from other Government programmes.

  Subject to Parliamentary approval of this new provision, the Government will publish for full public consultation the draft rules and procedures of the fund after Royal Assent. It is likely these rules and procedures will draw on the example of the partnership at work fund, involving an independent advisory board who will
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  make recommendations to my right hon. Friend the Secretary of State on the acceptability of union bids for fund money.

TRANSPORT

  Air Transport White Paper
  The Parliamentary Under-Secretary of State for Transport(Mr. Tony McNulty)
  I am announcing the publication of the supporting documents for the"Future of Air Transport" White Paper which was published on 16 December 2003. These reports provide some of the background to decisions taken in the White Paper.

  A list of all 27 supporting documents has been placed on the Department's website with details for obtaining hard copies. All the documents, listed below, are available in the Libraries of the House.

  Air quality assessments supporting the Government's Air Transport White Paper "The Future of Air Transport"

  Passenger Forecasts: Additional Analysis

  Review of London Oxford Airport Proposal

  Review of Redhill Aerodrome Ltd Proposal

  Review of Sheppey Airport Proposal

  Review of Thames Reach Airport Proposal

  Review of Goodwin Sands Airport Proposal

  Development of Airport Capacity in the Thames Estuary

  Aviation and Global Warming report

  Demand Forecasts for a Potential New International Airport in South East Wales

  Air Passenger Growth and Airport Capacity: Advice to the Department for Transport on the Future Nature and Distribution of Demand for Air Travel

  Air Passenger Growth and Airport Capacity: A Technical Discussion Paper

  Letter from CAA to DfT on Northolt and Redhill Airspace Implications

  The Effect of Competition between Regional Airports on— Airline Fares

  DfT, Birmingham Airport, SRA, Birmingham Airport Report on the enhancements needed to increase rail mode share at Birmingham Airport

  Midlands News Site— Note on Issues Raised in Consultation Response

  Edinburgh and Glasgow Airport Runway Options—Floodplain Impact and Mitigation Report

  ERCD Report 0307: Updated Methodology and Supplementary Information Relating to Aircraft Noise Exposure Estimates for UK airports

  ERCD Report 0308: Revised Future Aircraft Noise Exposure Estimates for UK Airports

  Newcastle International Airport (NCL) Rail Access Study

  The Future of Air Transport: Scotland— The Review of Air Traffic Forecasts for Airports Serving the Central Belt of Scotland

  Review of Scottish Airport Costs

  RHASS/Edinburgh Airport: Potential Development Options to 2030

  RHASS/Edinburgh Airport: Potential Long Term Development Options

  Road concepts for Edinburgh & Glasgow Airports

  The Potential for Developing a Regional Hub in Scotland

  Aviation, Core Cities and Regional Economic Development

Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Worcester

Northern Ireland: Racist Attacks
Lord Chan Lord Chan asked Her Majesty's Government:
What is their response to recent reports of racist attacks against black and other ethnic minorities in Northern Ireland.
The Lord President of the Council (Baroness Amos): My Lords, the Government have frequently put on record our abhorrence of all forms of intolerance. We have developed a co-ordinated response and will be publishing our race equality strategy for Northern Ireland this summer. Enforcement action by the Police Service of Northern Ireland will continue to be key. Today, the Government published legislative proposals to deal with what is often termed "hate crime". The Government are committed to eradicating all such manifestations of hatred, and to the creation of a safer and more tolerant Northern Ireland.
Lord Chan: My Lords, I thank the Minister for that helpful reply, but is she aware that there have been more racist attacks against the Chinese community in Belfast this January than in the entire 12 months of 2003? Further, is she concerned that racial attacks against Chinese businesses and families in England have increased since 2000, especially during the Chinese new year season of January and February?
Finally, will she confirm whether the Government will take steps to prevent any perverse racial attacks against the Chinese community as a result of the tragedy at Morecambe Bay, which indicates that it is about time that the Home Secretary's brave proposal of an amnesty for migrant workers who are here illegally was put in place?
Baroness Amos: My Lords. I thank the noble Lord. I am aware of the increase in racial attacks against the Chinese community in Northern Ireland, about which we are very concerned. The noble Lord will be aware that the Chinese community makes up the bulk of the ethnic minority community in Northern Ireland. We have been in discussion with members of community organisations about the best way to tackle the problem.
With respect to the wider question and the tragic incident in Morecambe Bay, the noble Lord will be aware that we have a clear, three-pronged strategy. The first prong is to tackle asylum; the second is to ensure that we work to build community cohesion; and the third concerns managed migration.
Lord Smith of Clifton: My Lords, does the Minister agree that the lack of police activity in the Village area
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of south Belfast has enabled loyalist terrorists to grow in strength there? It is not the first time that they have used their muscle: they have cleared students and Roman Catholics out of the area in the past. How many arrests have been made in recent weeks by the police dealing with those activities in the Village area?
Baroness Amos: My Lords, the situation in Northern Ireland is somewhat complex and, as I understand it, there may be a number of reasons why those attacks have increased. We have nationalist parties operating; we have protection rackets and people trafficking; and there is an allegation that some attacks are linked to the paramilitaries, although the noble Lord will be aware that the paramilitary organisations have made it absolutely clear that those attacks are unacceptable.
Policing is more visible and I understand that there have been three arrests, although I am not aware of what has happened about charging.
Lord Campbell of Alloway: My Lords, to put the matter in perspective, ought not a great tribute be paid to the police for the wonderful and difficult work that they have done in stopping Chinese terrorist gangs victimising their own countrymen in this country? They have done a fantastic job and, if we are to talk about the subject, there should be some balance to it.
Baroness Amos: My Lords, the Question concerns the situation in Northern Ireland, but on the noble Lord's point, of course the police are to be congratulated on the higher visibility policing that we have seen in areas where ethnic minority communities feel vulnerable. He will be aware of the announcement yesterday of a government initiative to tackle organised crime.
Viscount Brookeborough: My Lords, first, I declare an interest as a member of the Northern Ireland Policing Board. Is the Minister aware that liaison officers have recently been appointed in each district to deal with ethnic matters? Is she further aware that the day after tomorrow, the Community Involvement Committee, of which I am a member, is gathering representatives of minority communities, especially the Chinese, and of the senior police responsible for community involvement to a meeting to help to sort out the problem?
Baroness Amos: My Lords, I am aware of the appointment of ethnic minority liaison officers in each neighbourhood in Northern Ireland. I was not aware of the meeting, but I am pleased that it is going ahead and that the community, the police and the government agencies are coming together in this way.
Lord Laird: My Lords, as the Minister may recognise, I used to represent the Village area of Belfast. I am sure that the Minister will join me and every other right-thinking person in Northern Ireland to condemn these attacks without reservation, no matter who they are on, no matter what race or for

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what reason. I am sure she will agree that we should ask all right-thinking people to report any information that they have to the police immediately, to make sure that this nonsense is stopped for once and for all.
Baroness Amos: My Lords, the noble Lord is right. Of course I agree that we want to see condemnation of these attacks and we want to see these attacks stop. That is why the work of the Police Service of Northern Ireland is so important. We also need to work together to build community cohesion.
The Lord Bishop of Southwell: My Lords, will the Minister encourage and facilitate both Christian and other faith community groups and their leaders to work more closely together to combat xenophobia? Will the Minister investigate the schools curriculum to find imaginative, new, creative ways in which to help to build social cohesion?
Baroness Amos: My Lords, of course I agree with the right reverend Prelate. We need to work across the faiths. I will discuss the issue of education with my colleagues, and I will make the right reverend Prelate's point to them.
Lord Brooke of Sutton Mandeville: My Lords, given the extent to which the paramilitaries have been able to exercise their will in particular parts of Belfast, do the police believe the paramilitaries when they say that they have no part in what has been going on?
Baroness Amos: My Lords, as I understand it, the police consider that a complex range of issues are coming together. In answer to another question, I said that not only were there issues with respect to people trafficking, but with nationalist parties from Great Britain that are seeking to organise in Northern Ireland, as well as allegations with respect to the paramilitaries. All of these issues are being investigated by the police.

Chlamydia Screening Programme
2.45 p.m.
Baroness Gardner of Parkes Baroness Gardner of Parkes asked Her Majesty's Government:
Whether the chlamydia screening programme will only cover a quarter of primary care trusts; and, if so, what significant impact they expect this screening to achieve.
Baroness Andrews: My Lords, the aim of the chlamydia screening programme is to implement, by 2008 at the latest, a national prevention and control programme in England. We have already achieved coverage of over a quarter of primary care trusts in just over two years. Early detection and treatment of chlamydia not only reduces the prevalence of lower
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genital tract infections, but decreases the incidence of costly longer-term complications such as pelvic inflammatory disease and infertility.
Baroness Gardner of Parkes: My Lords, I thank the Minister for that Answer. I am glad that the Government are doing something. Unfortunately, it is not enough. Is the Minister aware that in the six years before 2002, chlamydia infection increased by 141 per cent, and in the most recent year's figures it increased by 14 per cent? Does she agree that one of the real problems is that 70 per cent of women and 50 per cent of men with the infection are totally unaware that they have it, and are symptomless? It is for that reason in particular and in view of the young age of those mostly affected that screening is the only thing that works.
Baroness Andrews: Yes, my Lords, all the figures that the noble Baroness has given are absolutely right. They present a depressing story, particularly because so many young women and men do not know that they are at risk. We have followed the National Strategy for Sexual Health and HIV, which is one of the first in Europe, and we have emphasised the screening programme that was introduced last year following the pilot. We are now at phase two, and by the summer we will have reached phase three, by which time over 100 PCTs will be involved. We will be reaching a lot of people in opportunistic screening where real use can be made of the findings. We are putting a lot more money into screening: £40 million in the past two years and another £26.4 million following the Health Select Committee's report.
Lord Rea: My Lords, can my noble friend reassure me that the screening programmes take adequate account of the role that men play in the spread of this infection? In sexually transmitted disease clinics, it is normal to ask the patient to inform their partner, and if that is not possible to slip them an anonymous calling card. At this time of year, it would be rather an unwelcome Valentine. Would she agree that to treat patients who then go back to their infected partners is rather a waste of time?
Baroness Andrews: My Lords, we are certainly targeting young men. We are conscious of the fact that young men are less confident about coming forward than young women. We have commissioned the Men's Health Forum to look at ways of helping us to develop the right strategies. We are looking at ways of reaching young men, through men's magazines, men's clubs, armed services bases and other places where we can be effective. In schools, the DfES is working with the National Children's Bureau to develop guidelines about how sex education can reach boys more effectively.
Baroness Masham of Ilton: My Lords, does the Minister think that in the long run it would be cost effective to make chlamydia notifiable?
Baroness Andrews: My Lords, we have chosen an opportunistic screening programme simply because

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we know that it is effective. We are reaching those people who we need to reach. For the moment, that is the most effective thing to do.
Baroness Barker: My Lords, does the Minister have an estimate of the cost of delaying the full roll-out of this programme to 2008, as opposed to the cost of increases in infertility and ectopic pregnancies and the cost to the department of treating those conditions?
Baroness Andrews: My Lords, I do not have a comparative cost. It is difficult to cost infertility. I take issue with the word that the noble Baroness used— "delaying". We are actually rolling this programme out faster, because as each phase comes on stream, we can learn from what we have achieved. Introducing a screening programme is not an instant fix, especially something like this where there must be a framework for follow-up, testing and treatment. We are actually making better progress than we thought at the beginning.
Baroness Perry of Southwark: My Lords, given that the 16 to 24 year-old age group is most affected by chlamydia, is it not particularly important that clinics in universities and colleges, and those dealing with upper secondary schools, are given priority in this programme, and that the educational programme carried out in schools emphasises the dangers and risks?
Baroness Andrews: Yes, my Lords. That is precisely why we are phasing in the programme to target educational establishments, such as colleges of further education, in particular. The reason for the age limit of 24 is that that is the age of greatest sexual activity. In addition, I understand that women are less likely to contract chlamydia as they grow older. We need to focus our resources where they would be most useful.
Baroness Gould of Potternewton: My Lords, I declare an interest as the chair of the Independent Advisory Group on Sexual Health and HIV. Is my noble friend aware that last year NICE recommended free IVF treatment on the NHS, but in doing so it did not refer to the relationship between infertility and chlamydia, which has been raised in this Question? What action is being taken to ensure that if the NICE proposals are implemented, that causal effect will be taken into account?
Baroness Andrews: My Lords, one of the reasons that we are accelerating the programme is the devastating consequences of infertility. An estimated 20 per cent of infertility cases are caused by chlamydia. The guidelines are scheduled for publication at the end of this month. The Government's position will be determined in the light of the final version. I am afraid that I shall have to ask my noble friend to await that outcome.
Earl Howe: My Lords, can the Minister clarify her earlier answer in which she said that 100 PCTs would
1038
be eligible for the screening programme later this year? Am 1 not right that the Department of Health's own report into the pilot screening programme in 2000 said that chlamydia screening should be introduced nationwide? What is the time-frame for doing that? Although the Minister is keen to tell us that the rate of progress has been good, I am not sure that I see it that way. Why has progress not been faster?
Baroness Andrews: My Lords, by the summer one-third of all PCTs will be in the screening programme. The noble Earl is right; it followed a highly successful pilot in which the efficacy of screening was proved by the take-up and the outcomes. I believe that in my original Answer I said that it would happen by 2008 at the very latest. We might be able to make faster progress if we can learn as the programme evolves We are quite optimistic. We are taking radical steps to inform people, as I am sure noble Lords will have seen, about the need to be aware that they are at risk. It is to be hoped that we will make fast progress.

Winter Fuel Payment
2.53 p.m.
Lord Ashley of Stoke Lord Ashley of Stoke asked Her Majesty's Government:
Whether the winter fuel payment can be extended to the 1.27 million severely disabled adults and children who receive the middle or higher rate of the disability living allowance care component, or the higher rate of the mobility component.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Mollis of Heigham): My Lords, winter fuel payments were created to ensure that the elderly can afford heating in cold weather. After all, 95 per cent of all the additional winter deaths are of pensioners. There are no plans to extend the payments to any groups below 60.
Lord Ashley of Stoke: My Lords, I thank my noble friend for that response. Does she recall that on the previous occasion on which I made this request she rejected it and gave the unconvincing excuse that, of those in fuel poverty, only 4 per cent were severely disabled, and that disability living allowance was available to help with fuel costs? Regardless of whether the figure is 1 per cent or 4 per cent, many severely disabled people—there are more than 1 million— cannot afford fuel to heat their homes or water, or to cook. It is irresponsible to leave such people unable to live a normal life. Will my noble friend remember that disability living allowance, which she said can help with fuel costs, is also supposed to help with the costs of food, laundry and care, so there is precious little left to cover fuel costs? Do the Government still say "no" to extending those payments to severely disabled people?
Baroness Mollis of Heigham: My Lords, I am afraid that, again, I shall have to challenge my noble friend's assertions. Disabled people, including severelydisabled people under 60, receiving DLA are not only half as likely to be in fuel poverty as pensioners, they are less likely to be in fuel poverty than the rest of us. That is because disability benefits, including DLA, are doing their job, and I am delighted that they are.
I shall give just one example: a lone parent with a non-disabled child will get £2,500 a year—about £50 a week—in financial support. If that child were severely disabled, the lone parent would get, not £2,500, but £10,000 a year in financial support—four times as much. I am delighted about that, but it means that the non-disabled child, not the disabled child, is more at risk of fuel poverty.
Lord Ezra: My Lords, not for the first time, the noble Lord, Lord Ashley of Stoke, has made the point that the winter fuel payment should be extended to severely disabled people below the age of 60, a number of whom, despite what the noble Baroness has said, could be in fuel poverty. In that connection, does she agree that fuel poverty is closely linked with poor housing? Can she assure us that severely disabled persons, particularly those who are housebound, will be given priority in ensuring that their homes are effectively insulated and provided with good heating?
Baroness Hollis of Heigham: My Lords, the noble Lord is absolutely right that fuel poverty is not only about income; possibly at least as importantly, it is about the state of housing. It is about whether the house is insulated; the fact that one quarter of our stock is pre-First World War; and pensioners, in particular, are likely to be under-occupying. In rural areas, pensioners are often not attached to gas mains so that their heating costs are proportionately higher. That is why pensioners are at most risk.
Whereas in 1997 nearly half of all our housing was below what we regard as a decent standard, primarily because of lack of thermal efficiency, we have brought that down to one third. Around 700,000 families on income-related benefits have received warm-front grants, and local authorities have received nearly £8 billion to bring the housing stock up to decent levels. We have some way to go, as housing stock is what we inherit, and it takes many years to renew it. But I am confident that the Government are well on their way to meeting their targets in that direction.
Lord Tomlinson: My Lords, does my noble friend not agree that, as she has rested heavily in her argument on the estimation of fuel poverty, it is a nonsense that everybody over the age of 60 receives the winter heating allowance, irrespective of need? Is there not a more fundamental case that needs at some time to be tackled: getting proper means-testing of all benefits, and benefits dealt with by a single mechanism rather than this complex multiplicity of mechanisms, which many people do not understand?
Baroness Hollis of Heigham: My Lords, there is a range of views about the efficacy or the right balance between means-tested or income-related benefits on the one hand and universal benefits on the other. The Government, for example, have increased their expenditure on pensioners in real terms since 1997 by £9 billion, half of which has gone to the poorest one-third, as my noble friend would like. But 52 per cent of those in fuel poverty are pensioners. That is why it makes sense to make this a universal benefit to those over 60.
Lord Skehnersdale: My Lords, disability living allowance at its various rates is intended as help from the taxpayer for those with extra costs resulting from their disability. Surely some of those extra costs are heating. Therefore, is there not a heating element in the calculation of DLA?
Baroness Hollis of Heigham: My Lords, DLA is meant to assist disabled people to meet the additional costs of their disability. In some cases, particularly for those with mobility problems, heating may be an issue; for others, it may be about diet; for others, it may be laundry. Around one-third of disabled people on disability benefits have mental health problems that may have no connection to heating needs. The noble Lord is right that it is a general benefit which disabled people and their carers can use as they see fit. But disabled people receiving those benefits are less likely to be in fuel poverty precisely because those benefits are adequate enough to meet their needs.
Lord Ashley of Stoke:My Lords, I am sorry to come back again. Instead of digressing on those byways and side-paths of other people who may or may not be worse off, perhaps my noble friend would deal with the central issue that I raised. More than 1 million severely disabled people cannot afford to heat their homes and water or to cook. How do the Government intend to deal with that?
Baroness Hollis of Heigham: My Lords, I am sorry, but I still challenge my noble friend's assertion. There are 1.3 million disabled people in receipt of attendance allowance. As they are more than 60 years old they receive the winter fuel payment. Of those who are in receipt of disablement benefits, whether income support, DLA or whatever, only a tiny proportion— something like 7 per cent, as far as we know—are suffering from some evidence of fuel poverty. It simply is not the case, as my noble friend said, that 1 million severely disabled people are suffering fuel poverty.

Iran: Democratic Reform
3 p.m.
Lord Phillips of Sudbury Lord Phillips of Sudbury asked Her Majesty's Government:
How they are co-operating with Iran to support its democratic evolution.
The Minister of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, we seek to support reform in Iran while maintaining a critical dialogue on areas of concern, such as Iran's approach to proliferation of weapons of mass destruction, human rights, the fight on terrorism and the Middle East peace process. We are concerned about reports that the final candidate list for Iran's parliamentary elections on 20 February is likely to exclude a large number of candidates. Our concerns are widely shared in the European Union and elsewhere.
Lord Phillips of Sudbury: My Lords, I am most grateful to the noble Baroness for that reply. I am sure that most noble Lords feel alarm at the blocking of reformist candidates. Does the Government agree that Iran, besides being in the early stages of its democratic development and being a theocratic state, also has a constitution of Byzantine complexity? If the Minister agrees, do we have any basis on which to influence the Iranians so that in future the Guardian Council will not have the power it currently exercises to block reformist candidates?
As a member of the Government, does my noble friend accept that there must be a serious governmental balance struck between the dialogue to which she has referred, which many of us have advocated for many years—be that dialogue constructive or be it critical—and perceived support which, given at the wrong time, can be seriously conunterproductive?
Baroness Symons of Vernham Dean: My Lords, I agree with much of what my noble friend has said. I shall be
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meeting the Iranian Ambassador later this week. I shall ensure that I give him a copy of the exchanges that have taken place in your Lordships' House. Perhaps I may make one point to my noble friend. As he said, the original list of candidates barred was some 3,600. That has been reviewed. Although it is not enormously improved, the number is now lowered to some 2,300. Furthermore, although there were a greater number of the current deputies barred, the number now is 70 out of the 290 deputies currently sitting.
There has been a marginal improvement. I just say that for the record. But the fact is that that makes no difference to the fundamental point made by my noble friend Lord Temple-Morris, which is that this is not the way to improve Iran's democratic credentials.
Lord Marsh: My Lords, given that true democracies are very rare in the world—the vast majority of countries are not true democracies by any calculation—could the Minister tell us on what criteria the Government decide which emerging democracies they choose to support and influence as opposed to all the others?
Baroness Symons of Vernham Dean: My Lords, of course there are many different standards of what one regards as democratic. I am sure that there are people all over the world who will look even at your Lordships' House and raise various questions. As I have already pointed out to some of my interlocutors on this point, the fact is that in this instance there are 70 individuals who, as of today, are able to sit in the Majlis in Iran who will be excluded from the elections on 20 February. That is not going forward in democratic terms. Alas, it appears to be going backwards.
Lord Archer of Sandwell: My Lords, does my noble friend agree that a regime condemned yet again by the last General Assembly of the United Nations for practising torture, amputations and blindings is not even pretending to evolve towards democracy? Can my noble friend assure the House that, so far as concerns, the United Kingdom, Iranians found in Iraq will not be returned to the clutches of the torturers and murderers from whom they are trying to escape?
Baroness Symons of Vernham Dean: My Lords, of course, we will have to look very carefully at any individuals who are claimed by countries that practise torture, amputations and various forms of capital punishment. I accept what my noble and learned friend has said. There is an enormous amount of ground to work on with the Iranians in relation to human rights. There is progress, albeit very slow. For example, we have been able to work on an announcement by the Supreme Administrative Court that the practice of stoning has been suspended.
I recognise that that may seem a marginal point to some of your Lordships. We are calling for a moratorium on all the hideous forms of amputation that are practised as a means of discipline, as a means of a legal system. But there is a great deal of work to do in that respect. We certainly do not shirk from undertaking it.
Lord Howell of Guildford: My Lords, does the Minister agree that there are signs that the Iranian Government want to have closer links with the West and to play a more responsible global role? In particular, the young people of Iran seem to be strongly pro-West and many of them want to live in the United States. As this exchange has confirmed, there is not much democratic evolution going on in Iran at the moment, with those 2,000 candidates banned from the elections next week.
Would those who have contact with Iran, including this Government, keep reminding the Iranians that if they want closer and better relations, free elections are better than building nuclear weapons? They would provide a much better basis for the close relations which are needed. In some ways, that is evidenced by the very warm reception that Prince Charles has had on his visit to Iran where he took our sincere condolences to the people of Iran for the horrific slaughter in the town of Bam.
Baroness Symons of Vernham Dean: Yes, my Lords, of course. On that last point, I am sure that we all welcome the visit of His Royal Highness to Bam, which he undertook in his role as patron of the Red Cross. I am sure that he was able to bring comfort to that city in its dreadful plight. Of course the noble Lord is right. We want to see free elections. I would not wish your Lordships to take away an entirely gloomy picture of what is happening in our relationship with Iran.
As I indicated in my initial response to the noble Lord, Lord Phillips, we are supporting reform in Iran. We believe that we are working with the grain of the reformists in Iran. We should not forget that there are elected deputies and elected people in positions of power in Iran. As I think your Lordships have been able to discuss, the problem arises with the role of the Guardian Council. Of course we are engaged in very important discussions; for example, on the whole issue of weapons of mass destruction. We should not throw away what is good, what is working in the relationship, where we believe that we can work with reforming influences because there is still a very bad record on human rights and there also appears to be a rather less full approach to the elections on 20 February than we would wish.

Airline Passengers: Wheelchair Levy
3.10 p.m.
Lord Carter Lord Carter asked Her Majesty's Government: What is their view of the proposal to charge airline passengers a levy on each ticket to cover the cost of providing wheelchairs for disabled passengers when the proceeds of the levy will exceed the cost of providing wheelchairs.
Lord Davies of Oldham: My Lords, the setting of fares is entirely a matter for individual airlines. However, as a matter of principle, the Government welcome the recent ruling that the cost of providing assistance should not be passed on to the disabled passenger. That principle is enshrined in the Department for Transport's voluntary code of practice for the UK air industry and in the European Airline Passenger Service Commitment.
Lord Carter: My Lords, I thank my noble friend for that Answer. Is he aware that the wheelchair levy of 50p on every ticket that Ryanair is charging will raise £12 million per annum, which will far exceed the actual cost to Ryanair of providing wheelchairs—about 2p per ticket? Leaving aside the question of whether there should be a charge for providing wheelchairs at all, does my noble friend agree that the levy is a disgraceful example of using disability as an excuse for blatant profiteering? Should not the levy be referred to the Office of Fair Trading? The Ryanair website states:
"The amount of the levy will be continuously reviewed upwards or downwards to ensure that Ryanair collects only what is required to cover the provision of assistance at Stansted".
Lord Davies of Oldham: My Lords, Ryanair, of course, is not a British airline. Therefore, there is a limit to how much British law can influence and affect Ryanair. My noble friend has identified the key point, that originally the intention was to pass the cost on to disabled passengers. Following the court ruling, it has been suggested that the charge for each ticket should rise by 50p, when the actual cost of providing for disabled passengers may be only 2p per ticket.
Lord Forsyth of Drumlean: My Lords, why is this not the responsibility of the airport operators? Surely it should be for the British Airports Authority to ensure that passengers can be safely taken to their points of departure. It should not be left as a squabble between the BAA and the airlines. If the BAA can afford to provide free parking for Members of Parliament, surely it can afford wheelchairs for the disabled.
Lord Davies of Oldham: My Lords, the noble Lord has identified the fact that the legislation implemented by airports stops at the point at which the passenger embarks, is cared for on the aircraft and disembarks from it. The provisions of the draft Bill propose that the requirement should extend to the aviation industry and to the aircraft. Therefore, when my noble friend's committee has finished its pre-legislative scrutiny and we are able to consider the Bill, we shall consider extending the provisions to airlines.
Lord Morris of Manchester: My Lords, does not the court's decision in this deeply disturbing case reflect very high credit on the DRC and emphasise again the urgency of the need to enact the Government's new legislation on disability discrimination?
Lord Davies of Oldham: My Lords, I agree with my noble friend. The court case was clear that the commission was right to raise the issue, and it obtained a judgment in its favour. That demonstrates the excellent work that the commission does on behalf of the disabled. As my noble friend rightly said, the next stage is to ensure that we introduce measures to advance the cause of the disabled.
Lord Addington: My Lords, will the Minister give an assurance that the Government will use their influence and power to ensure that this sort of objectionable profiteering does not carry on and that disabled people are never again used as an excuse for upping the price of tickets?
Lord Davies of Oldham: My Lords, as I indicated in my original Answer, Ryanair is not a British airline. But, of course, the European Commission is also active in this area and proposes to introduce regulations to deal with the situation.
Lord Hughes of Woodside: My Lords, if Ryanair is unwilling to change its policy, might it not qualify for the accolade "Cheapskate airline of the year"?
Lord Davies of Oldham: My Lords, I am not sure that my role is to comment on the virtues or defects of particular airlines, but I think that in this case the slogan "no frills" is not a particularly advantageous advertisement.
Lord Campbell of Croy: My Lords, I begin by declaring an interest. Since World War II, I have been dependent on wheelchairs at airports. Can the Government make any suggestions as to how the levy is to be calculated?
Lord Davies of Oldham: My Lords, the Government's intention is not to introduce a levy, but to introduce a law and consequential regulations that oblige airlines to treat disabled passengers in a totally non-discriminatory way.
Lord Strathclyde: My Lords, with regard to the question of my noble friend Lord Forsyth, will the Minister give a clear answer? Do the Government believe that the airport operators, rather than the airlines, have a responsibility in this respect?
Lord Davies of Oldham: My Lords, under British law, the airport operators have a clear responsibility, which they fulfil, to care for disabled passengers in a non-discriminatory and helpful way. The problem is that the law does not extend to the boarding of aircraft, to passenger seats on aircraft or to disembarkation. Our proposed legislation, and that of the European Commission on behalf of all the European airlines, addresses that feature.

Justice (Northern Ireland) Bill [H.L.]
3.17 p.m.
Read a third time.
Clause 4 [Appointment of Lord Chief Justice and Lords Justices of Appeal]:
Lord Glentoran Lord Glentoran moved Amendment No. 1:
Page 3, line 8, at end insert ", and
(c) consult the Lord Chancellor"
The noble Lord said: My Lords, this group of amendments was tabled on Report but, due to the delayed start occasioned by a Statement and my particular desire to move on quickly to Clause 5, I did not move them. I now return to them because I believe that they are an extremely important part of the Bill and because I believe that Her Majesty's Government have again got it wrong. In principle, the amendments refer to the appointment of the Lord Chief Justice and Lords Justices of Appeal.
There should not be only a single name put forward either jointly or by the First Minister and Deputy First Minister. 1 suggest that they can and should indicate their preferences and, where these coincide, they should carry significant weight.
According to the Bill, the Prime Minister's duty remains to make the appointment on merit, which I support entirely. He or she must be capable of being satisfied that the paramount requirement—the merit principle—is fulfilled. Any other interpretation would mean that the predominant consideration was political. Therefore the existing practice, at least as it was under my noble and learned friend Lord Mackay and probably under the noble and learned Lord, Lord Irvine, and it is hoped under the noble and learned Lord, Lord Falconer, whereby the field was very carefully surveyed in close consultation with the most senior judiciary, needs to find continuing expression in Northern Ireland and to be a part of the procedure. It should be considered seriously whether not only the Lord Chief Justice should be consulted personally, but also that the views of the Judicial Appointments Commission as a whole should be known.
It is also desirable that the Lord Chancellor should continue to be consulted. As I read the Bill, the Lord Chief Justice of Northern Ireland will have either no or very little input, and the Judicial Appointments Commission absolutely no input. In that context, it may be that, in practice, the convoluted provisions for devising apparently ad hoc procedures for each such appointment set out in Clause 4(5) and (6) will take some or all of the above into account. But the Judicial Appointments Commission is certainly not permitted to recommend names. Both this and what is to happen generally need to be spelt out clearly on the face of the Bill, otherwise there is a real danger that such appointments will lack well informed and carefully considered advice, and degenerate into political horse-trading.
The Government say that they set out to ensure the depoliticisation of judicial appointments in Northern Ireland. But what they have done is the opposite and

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in my opinion it was done in a cynical way. I believe that most of the Bill has emerged as the result of debate, discussions and negotiations with political parties. Much of what is in it, including these clauses, is at the behest of one or other of those political parties. In anyone's book, that is not depoliticisation; it is politicisation.
We only have to compare this with what Her Majesty's Government think is right for England and Wales. I refer to some of the provisions. For appointments to the Court of Appeal, a senior appointments panel will be established by the Judicial Advisory Commission for England and Wales comprising the Lord Chief Justice, a head of division or other Court of Appeal judge chosen by the Lord Chief Justice, the chairman of the Judicial Appointments Commission or a deputy chosen by him—a lay member, and a further lay member of the JAC chosen by the chairman. This panel will provide one name for the vacancy specified and a list of other candidates who might be suitable.
The Secretary of State—I am not being political in saying that; while the provision refers to the Lord Chancellor's Department, it will involve the Secretary of State for Constitutional Affairs—can ask the panel once to reconsider, and he can reject a candidate once.
For appointments to the head of division, including the Lord Chief Justice, the senior appointments panel will be made up of the most senior of the judges from England and Wales who are members of the Supreme Court from England or a deputy chosen by him; the Lord Chief Justice or, if appointing to the post of Lord Chief Justice, a head of division or other appropriate judge chosen by the senior judge as mentioned above; the chairman of the Judicial Appointments Commission or a deputy chosen by him—a lay member; and a further lay member of the JAC chosen by the chairman.
In conclusion, not only does the Judicial Appointments Commission for England and Wales have a hand in the consultation process, it can recommend the candidates. For Northern Ireland, however, the First Minister and Deputy First Minister consult the JAC only about procedure in making a single recommendation to the Prime Minister. I suggest that this is monstrously inconsistent and very political. I beg to move.
Lord Monson: My Lords, the noble Lord, Lord Glentoran, made a powerful and, I suggest, overwhelming case for these amendments. While there is no problem with Amendments Nos. 1, 2 and 3, I wonder whether there might be a drafting error in Amendment No. 4, which is rather less important than the other three. Should not the word "and" appear after the word "recommendation"?
Baroness Amos: My Lords, I am aware of the concerns of the noble Lord, Lord Glentoran, about this issue. It is clear that the noble Lord is seeking to
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build in safeguards in relation to senior judicial appointments to minimise his concerns about the possible scope for political influence.
Perhaps I may say at the outset that throughout our examination of the Bill we have sought to ensure that the independence of the judiciary is upheld. The noble Lord referred to what would be relevant in England and Wales. I should say to him that there are common principles relevant to all three jurisdictions of the United Kingdom—Northern Ireland, Scotland, and England and Wales. These are the ideals of enduring judicial independence, transparency, accountability and high public confidence in the judiciary.
However, the fact that there are three jurisdictions means that certain differences in approach will be taken at the operational level. In practice these differences are right, proper and necessary to reflect the differences between the jurisdictions. Moreover, one point that has been made abundantly clear in our discussions about the Bill is that there are particularities in Northern Ireland which we need to take into account. So I am sorry that the noble Lord is not convinced that the procedure on devolution for senior judicial appointments is sufficiently robust.
Amendments Nos. 1 and 3 seek to provide for statutory consultation with the Lord Chancellor when making senior judicial appointments. The Prime Minister will make a recommendation to Her Majesty after considering the recommendation of the First Minister and Deputy First Minister. The Lord Chief Justice will be consulted, as provided for in the Justice (Northern Ireland) Act 2002. His views will be made known to the Prime Minister. Further, there is nothing to stop the Prime Minister or the First Minister and Deputy First Minister consulting the Lord Chancellor.
However, I must remind noble Lords that we are discussing senior judicial appointments in a post-devolution criminal justice environment when the Lord Chief Justice will be head of the judiciary in Northern Ireland, not the Lord Chancellor. I would therefore propose that it is not necessary to provide for statutory consultation with the Lord Chancellor.
Amendment No. 2 seeks to specify that when making senior judicial appointments, the First Minister and Deputy First Minister will supply a list of at least three names to the Prime Minister. The clause as it stands gives the Prime Minister flexibility over the number of names he might require from the First Minister and Deputy First Minister. Of course the Prime Minister might ask for three names, or he might ask for fewer than three. The Prime Minister can decide in each case. We believe that this flexibility is important and should be maintained.
The effect of Amendment No. 4 would be that the Judicial Appointments Commission, as well as advising the First and Deputy First Ministers on the procedure to adopt when making senior judicial appointments, would also advise on the substance of the recommendations. Recommendation 85 of the Criminal Justice Review states:

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"The First Minister and Deputy First Minister should consult with the Judicial Appointments Commission over the procedure to be adopted in appointments to the positions of Lord Chief Justice and Lords Justices of Appeal".
The review did not recommend that the commission should provide advice on the substance of recommendations to the Prime Minister. This would give the commission a role in individual appointments to senior judicial offices which was never intended. They are currently required to advise the First Minister and Deputy First Minister on a general process to be used for making recommendations about senior appointments.
I said at the beginning that what we have put in place is robust. Of course we wish to maintain the independence of the judiciary. This is not about political influence or interference. The review was very clear with respect to the Judicial Appointments Commission's direct involvement in appointments. It should cease at the level of the High Court judge. I hope that in the light of this explanation the noble Lord, Lord Glentoran, will feel able to withdraw his amendment.
Lord Glentoran: My Lords, I thank the Lord President. I hear what she says in relation to my Amendment No. 1 on devolution. I am afraid that her arguments on Amendment No. 2 are not acceptable. As a member of the Northern Ireland community, as a Member of your Lordships' House and in my role at the Dispatch Box, I find it quite incongruous that Northern Ireland's judicial system should be downgraded and politicised to the extent that it has been by this Government. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Glentoran Lord Glentoran moved Amendment No. 2:
Page 3, line 8, at end insert—
"( ) Any specification by the Prime Minister under subsection (3)(a) in relation to recommendations from the First and Deputy First Minister must specify that the recommendation shall contain no fewer than three candidates."
The noble Lord said: My Lords, I wish to test the opinion of the House. I beg to move.
3.32 p.m.
On Question, Whether the said amendment (No. 2) shall be agreed to?
Their Lordships divided: Contents, 106; Not-Contents, 156.

Division No. 1

CONTENTS

Ackner, L.

Bridges, L.

Alexander of Weedon, L.

Brooke of Sutton Mandeville, L.

Ampthill, L.

Brookeborough, V.

Anelay of St Johns, B.

Brougham and Vaux, L.

Astor of Hever, L.

Buscombe, B.

Attlee, E.

Byford, B.

Blaker, L.

Caithness, E.

Bowness, L.

Campbell of Alloway, L

Bridgeman, V.

Carnegy of Lour, B.

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Cockfield, L.

Marlesford, L.

Cooke of Islandreagh, L.

Mayhew of Twysden, L.

Cope of Berkeley, L. [Teller]

Miller of Hendon, B.

Courtown, E.

Molyneaux of Killead, L.

Cox, B.

Monson, L.

Crickhowell, L.

Montagu of Beaulieu, L.

Cuckney, L.

Montrose, D.

Dean of Harptree, L.

Moore of Wolvercote, L.

Deedes, L.

Mowbray and Stourton, L.

Denham, L.

Murton of Lindisfarne, L.

Dixon-Smith, L.

Naseby, L.

Dundee, E.

Northesk, E.

Fitt, L.

O'Cathain, B.

Flather, B.

Patten, L.

Fookes, B.

Perry of Southwark, B.

Forsyth of Drumlean, L.

Pilkington of Oxenford, L.

Gardner of Parkes, B.

Platt of Writtle, B.

Gilmour of Craigmillar, L.

Rawlinson of Ewell, L.

Glentoran, L.

Reay, L.

Goschen, V.

Renfrew of Kaimsthorn, L.

Gray of Contin, L.

Roberts of Conwy, L.

Griffiths of Fforestfach, L.

Rogan, L.

Hayhoe, L.

Rotherwick, L.

Henley, L.

Sanderson of Bowden, L.

Hodgson of Astley Abbotts, L.

Seccoombe B [Teller]

Hooper, B.

Selsdon, L.

Howe, E.

Shaw of Northstead, L.

Howell of Guildford, L.

Shaw of Glaisdale, L.

Hussey of North Bradley, L.

Skelmersdale, L.

James of Holland Park, B.

Stoddart of Swindon, L.

Jopling, L.

Strathclyde, L.

King of Bridgwater, L.

Swinfen, L.

Kingsland, L.

Thatcher, B.

Knight of Collingtree, B.

Thomas of Gwydir, L.

Laird, L.

Trefgarne, L.

Liverpool, E.

Trumpington, B.

Lucas, L.

Vinson, L.

Luke, L.

Waddington, L.

Lyell, L.

wade of Chorlton, L.

McAlpine of West Green, L.

Wakeham, L.

MacGregor of Pulham Market, L.

Warnock, B.

Wilcox, B.

Mackay of Clashfern, L.

Willoughby de Broke, L.

Maginnis of Drumglass, L.

Windlesham, L.

Wolfson, L.

NOT-CONTENTS

Acton, L.

Colville of Culross, V.

Addington, L.

Condon, L.

Ahmed, L.

Corbett of Castle Vale, L.

Amos, B. (Lord President)

Crawley, B.

Andrews, B.

David, B.

Archer of Sandwell, L.

Davies of Oldham, L. [Teller]

Ashley of Stoke, L.

Dholakia, L.

Ashton of Upholland, B.

Dixon, L.

Avebury, L.

Donoughue, L.

Barker, B.

Dubs, L.

Barnett, L.

Elder, L.

Bassam of Brighton, L.

Evans of Parkside, L.

Beaumont of Whitley, L.

Evans of Temple Guiting, L.

Berkeley, L.

Ezra, L.

Bernstein of Craigweil, L.

Falconer of Thoroton, L. (Lord Chancellor)

Boothroyd, B.

Boston of Faversham, L.

Farrington of Ribbleton, B.

Brooke of Alverthorpe, L.

Faulkner of Worcester, L.

Brookman, L.

Fearn, L.

Campbell-Savours, L.

Filkin, L.

Carey of Clifton, L.

Finlay of Llandaff, B.

Carter, L.

Gavron, L.

Chan, L.

Goldsmith, L.

Christopher, L.

Goodhart, L.

Clark of Windermere, L.

Gould of Potternewton, B.

Clarke of Hampstead, L.

Graham of Edmonton, L.

Clinton-Davis, L.

Greengross, B.

Cobbold, L.

Gregson, L.

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Grocott, L. [Teller]

Pitkeathley, B.

Harris of Richmond, B.

Prys-Davies, L.

Harrison, L.

Puttnam, L.

Haskel, L.

Radice, L.

Hilton of Eggardon, B.

Ramsay of Cartvale, B.

Hogg of Cumbernauld, L.

Randall of St. Budeaux, L.

Hollis of Heigham, B.

Rea, L.

Hooson, L.

Redesdale, L.

Howarth of Breckland, B.

Rennard, L.

Howells of St. Davids, B.

Richardson of Calow, B.

Howie of Troon, L.

Rodgers of Quarry Bank, L.

Hoyle, L.

Rooker, L.

Hughes of Woodside, L.

Roper, L.

Hunt of Chesterton, L.

Sainsbury of Turville, L.

Hunt of Kings Heath, L.

Scotland of Asthal, B.

Irvine of Lairg, L.

Scott of Needham Market, B.

Jones, L.

Sheldon, L.

Kirkhill, L.

Shutt of Greetland, L.

Lea of Crondall, L.

Simon, V.

Lester of Herne Hill, L.

Smith of Clifton, L.

Linklater of Butterstone, B.

Smith of Gilmorehill, B.

Lipsey, L.

Smith of Leigh, L.

Livsey of Talgarth, L.

Stone of Blackheath, L.

Lockwood, B.

Strabolgi, L.

Lofthouse of Pontefract, L.

Strange, B.

Macdonald of Tradeston, L.

Symons of Vernham Dean, B.

McIntosh of Haringey, L.

Taverne, L.

McIntosh of Hudnall, B.

Taylor of Blackburn, L.

MacKenzie of Culkein, L.

Temple-Morris, L.

Mackie of Benshie, L.

Tenby V.

McNally, L.

Thomas of Gresford, L.

Maddock, B.

Thomas of Walliswood, B.

Mar and Kellie, E.

Thornton, B.

Marsh, L.

Tomlison, L.

Mason of Barnsley, L.

Tordoff, L.

Massey of Darwen, B.

Triesman, L.

Merlyn-Rees, L.

Turner of Camden, B.

Michie of Gallanach, B.

Wallace of Saltaire, L.

Miller of Chilthorne Domer, B.

Walmsley, B.

Mitchell, L.

Walpole, L.

Morgan, L.

Warner, L.

Morris of Aberavon, L.

Warwick of Undercliffe, B.

Morris of Manchester, L.

Weatherill, L.

Murray of Epping Forest, L.

Whitaker, B.

Northover, B.

Whitty, L.

Oakeshott of Seagrove Bay, L.

Williams of Crosby, B.

Orme, L.

Williams of Elvel, L.

Parekh, L.

Williamson of Horton, L.

Patel, L.

Winston, L.

Pendry, L.

Woolmer of Leeds, L.

Peston, L.

Resolved in the negative, and amendment disagreed to accordingly.
3.45 p.m.
[Amendments Nos. 3 and 4 not moved.]
Clause 5 [Duty of Director of Public Prosecutions to refer certain matters to Police Ombudsman]
Lord Maginnis of Drumglass Lord Maginnis of Drumglass moved Amendment No. 5:
Leave out Clause 5.
The noble Lord said: My Lords, both in Committee and on Report I indicated that my party and I are unhappy with the Bill, largely because we suspect that it will not work for the greater good of the people of Northern Ireland. It is a very political Bill. In his remarks earlier, the noble Lord, Lord Glentoran, intimated that he feels likewise.
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One should consider the words of the noble Lord, Lord Dubs, at Report stage. He said about this part of the Bill:
"The Government gave their commitment at Hillsborough in the Joint Declaration. It would be a sad day if the Government were to renege on a promise they made to the Northern Ireland parties".
The only matter I take issue with on that is that it was not a commitment given to "the" Northern Ireland parties; it was a commitment given, secretly and without agreement, to "a" Northern Ireland party.
The noble Lord, Lord Dubs, continued:
"It would be a sad day if the House were to say, 'Never mind what undertakings the Government made: we think differently'. The situation in Northern Ireland, with the start of the talks today on the review of the Good Friday agreement, is sensitive. It would be unhelpful if this House were to change the Bill in the way the amendment suggests".—[Official Report, 3/2/04; col. 597.]
We simply do not believe that secret and clandestine arrangements made outside the House—by whoever— override the interests of those of us who come here to legislate for the good of society as a whole. That is why Amendment No. 5 seeks to leave out Clause 5.
The clause relates to the duty of the Director of Public Prosecutions to refer certain matters to the Police Ombudsman. I cannot look at the clause without wondering where the powers of the Police Ombudsman end. Is the Police Ombudsman to be all powerful? Is the Police Ombudsman's influence to override the influence of the command of the Police Service of Northern Ireland; the influence of the Policing Board; the influence of Her Majesty's Inspectorate of Constabulary; and, in a way, the influence of the Office of the Director of Public Prosecutions?
I acknowledge that I have received a letter from the noble and learned Lord, Lord Goldsmith, the Attorney-General, in which he sought to reassure me on this point. However, I am not reassured in any way.
New subsection (4A) in Clause 5(3) states:
"The Director shall refer to the Ombudsman any matter which…appears to the Director to indicate that a police officer…may have committed a criminal offence".
If it is believed that a police officer has committed a criminal offence the matter will obviously be referred to the Director of Public Prosecutions, who will make a considered judgment based on the evidence before him. If there is a good chance that he will achieve a conviction, he will take the matter to court. If there is a 50–50 chance, he may decide to take the matter to court. If there is a 40 per cent chance, he will make an assessment.
But let us consider the case where the Director of Public Prosecutions looks at the information and evidence brought before him and decides that there is a 5, 10 or 15 per cent chance—in other words, a case where he would not recommend prosecution through the courts. That should be the end of his responsibility. It is not for him then to ask questions that impinge on the responsibility of the police command, Her Majesty's Inspectorate of Constabulary and the other institutions to which I have referred. Never have the police been so policed as they are now. We should not

1053
regard the Police Service of Northern Ireland as a body that needs to be passed from one invigilating authority to another.
Let us return to the case where the DPP has decided that the policeman will not be taken to court; that he will not give or require the opportunity, as the case may be, for the policeman to account for his behaviour before a jury of his peers. I have already acknowledged that the Attorney-General has written to me. Whatever he may say, is it not a form of double jeopardy?
When the DPP says, "What has come before me does not appear to me to necessitate prosecution, but I shall relegate the judgment on this case to the police ombudsman", the policeman will not in fact be tried or examined by a jury of his peers. Yet, when that case is passed to the ombudsman, is there not—because of its source, which is the office of the Director of Public Prosecutions—to some extent an obligation on her that would not have been on her had the matter arrived on her desk through the system that she controls? Is there not a greater likelihood of more severity and greater pressure being brought to bear in respect of a policeman? The same situation occurs in terms of new subsection (4A)(a)(ii). That new subsection refers to the possibility that it may appear,
"to the Director to indicate that a police officer…may, in the course of a criminal investigation, have behaved in a manner which would justify disciplinary proceedings".
I have experienced a poorly prepared prosecution coming out of the DPP's office. If that happened, and there is an "inquest" into why a prosecution has failed, is there not likely to be a natural fall-back position, asking the police ombudsman to examine the evidence that the police provided in bringing the prosecution in the first place?
Again, it is very much a matter of who minds the minder. Quite simply, I do not believe—and many people would agree with me—that the DPP's role and responsibility should be that of message boy or girl, as the case may be, for the police ombudsman. We have adequate supervision of policing at every level. To impose this particular clause on top of all that has gone before and all that currently exists is to create double jeopardy, however Government Ministers may try to explain it away. I beg to move.
Lord Glentoran: My Lords, I shall be brief. The Bill would be better without this clause. We have a new police force in Northern Ireland, the PSNI. It has new cultures developing and evolving. In Northern Ireland, we are desperately short of trust between all the organisations: political parties, religions, police forces and various other aspects and parts of the judicial and criminal services. They have links with the British Army. There are huge numbers of interlinks and interfacing organisations, all attempting to cope with extraordinarily difficult levels of crime and terrorism. I do not see what is only a provocative clause achieving anything very much; the Bill would be better off without it.
The Attorney-General (Lord Goldsmith): My Lords, I too can be brief because we debated this clause at some length in Committee and on Report.
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I shall respond first to the points made by the noble Lord, Lord Maginnis. This amendment is not about the powers of the ombudsman; those are not at issue. It is about the Director of Public Prosecutions passing matters across, in certain circumstances, to the ombudsman. It does not touch on what powers the ombudsman has when he or she—presently she— receives that information. It is not about overriding the Director of Public Prosecutions. So far in these debates, I have made two points clear. First, that the director's independence, professionalism and integrity are beyond doubt and, secondly, that the decision on prosecution remains absolutely and completely that of the director, not of the ombudsman. It is only after the director has made a decision, one way or another, that the matter will go to the ombudsman, if it goes at all.
I said that in my letter to the noble Lord, Lord Maginnis, which he was generous enough to acknowledge today. I shall quote what 1 said to him, so that your Lordships are aware of it too. I wrote:
"It may help if I make it absolutely clear that decisions as. to prosecutions are, and will remain, the responsibility of the Director of Public Prosecutions for Northern Ireland. The responsibility of the Police Ombudsman is to investigate allegations of criminality by police officers or of behaviour that may justify disciplinary proceedings".
That is the disciplinary side.
That takes me to my second point. The noble Lord, Lord Maginnis, was worried that the Director of Public Prosecutions, having made his proper decision about prosecution, might need to ask questions—I noted his words as,
"impinging on questions of the police command and so forth".
No, after the decision on prosecution is made and executed, it will not be for the director to do that. If it falls within this clause, it would be for him to pass the matter across to the police ombudsman and it would then be for the police ombudsman, if appropriate, to make further enquiries. It may well not be appropriate. That would be for the ombudsman to decide.
The third point that he made is that, because an issue has been put before the ombudsman by the Director of Public Prosecutions, that would somehow give it greater gravity or require her to deal with it with greater severity. I do not see that at all. The ombudsman will be obliged to consider the material before her on the objective basis of that material and its strength, and not on the basis of the provenance of the material. That is particularly so because the director will be passing the information over as a result of a duty—that is the very thing that this clause imposes—not as a result of a judgment by him that the matter is one that deserves consideration by the ombudsman.
The noble Lord, Lord Maginnis, was concerned, on the previous occasion at least, about what he described as double jeopardy. Another matter dealt with in the letter that I wrote to him responded to a question that he sought to ask on the previous occasion. A police officer is not in a different position from that of many other people who belong to professional bodies. After trials of all sorts, people in professional bodies may find themselves referred to their professional bodies or to other disciplinary bodies for consideration. As a barrister, that

1055
is certainly something that would undoubtedly happen to me. I have experience of other professionals too, such as solicitors and doctors. Police officers are not in that regard in a unique position in any respect.
Moreover, this issue is more likely to arise in circumstances where the officer is not the subject of the investigation but is the investigating officer or is involved in the course of investigating somebody else. If Mr A is on trial, but it appears that the police officer has misconducted himself, there is no question of double jeopardy so far as the officer is concerned. For those reasons, I respectfully suggest that the concerns of the noble Lord, Lord Maginnis, are not well founded.
I heard what the noble Lord, Lord Glentoran, said about there being a shortage of trust in Northern Ireland. As Attorney-General for Northern Ireland, I understand what he means by that. However, I invite him and those on the Benches opposite carefully to consider this: is not one of the reasons for the lack of trust in some parts of the communities a belief, however ill founded, that wrongdoing on the part of particular people is covered up and not passed over? Having a clear obligation on the Director of Public Prosecutions that says, "If you come across this sort of conduct, you must pass it to the Police Ombudsman", gives many people in the community a sense of trust that there can be no question of that sort of material being seen by someone in the DPP's office and covered up simply because they prefer not to expose to daylight any misconduct.
I agree with the noble Lord, Lord Glentoran, that trust is important. This clause will increase trust within the community. I warmly urge him and those on the Benches opposite to consider that, in accordance with his objective of increasing trust, which I share, the right thing to do is to support this clause.
4 p.m.
Lord Maginnis of Drumglass: My Lords, the noble and learned Lord the Attorney-General has outlined very clearly the technical aspects of the matter that I raised. However, he has not clarified at all—it is impossible to clarify—the fact that the DPP is concerned with criminality. Criminality is different from professional inadequacy or carelessness. The people who deal with those things are the ombudsman, Her Majesty's Inspectorate of Constabulary, the police officer's own senior command and the Policing Board. There is no such cross-fertilisation in the case of the solicitors, doctors and accountants that the Attorney-General mentions in his letter. Those professional bodies make a judgment that is separate and apart from the judgment of criminality made by the Director of Public Prosecutions. Hence, I have not had a satisfactory explanation of why, in this specific case, there should be that overlap between criminality and professional inadequacy, misjudgment or carelessness.
If we adopt this clause, we give the Police Ombudsman a second opportunity to find evidence against a policeman which, in turn, may lead to a
1056
prosecution, because if she finds something within the scope of her investigations that suggests criminality, she is bound to refer the matter back. The situation will be such that, having considered the case against the policeman, and decided that there is no case to answer, the case is passed to the ombudsman and then handed back. The DPP has to make the same judgment on a second occasion. That is absolute nonsense. If it is not double jeopardy, it is what I always believed double jeopardy to be.
I am not satisfied that this clause is beneficial. I should like to seek the opinion of the House.
4.4 p.m.
On Question, Whether the said amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 81; Not-Contents, 170.

Division No. 2

CONTENTS

Ackner, L.

MacGregor of Pulham Market, L.

Blaker, L.

Bowness, L.

Mackay of Clashfern, L.

Brigstocke, B.

Maginnis of Drumglass, L.

Brookeborough, V. [Teller]

Marlesford, L.

Brougham and Vaux, L.

Mayhew of Twysden, L.

Caithness, E.

Molyneaux of Killead, L.

Carnegy of Lour, B.

Monson, L.

Chadlington, L.

Montrose, D.

Cockfield, L.

Mowbray and Stourton, L.

Coe, L.

Murton of Lindisfarne, L.

Cooke of Islandreagh, L. [Teller]

Naseby, L.

Courtown, E.

O'Cathain, B.

Cox, B.

Onslow, E.

Crickhowell, L.

Palmer, L.

Cuckney, L.

Patten, L.

Dean of Harptree, L.

Perry of Southwark, B.

Deedes, L.

Pilkington of Oxenford, L.

Denham, L.

Platt of Writtle, B.

Dundee, E.

Plumb, L.

Flather, B.

Prior, L.

Fowler, L.

Rawlinson of Ewell, L.

Gardner of Parkes, B.

Reay, L.

Goschen, V.

Rogan, L.

Gray of Contin, L.

Saltoun of Abernethy, Ly.

Griffiths of Fforestfach, L.

Sanderson of Bowden, L.

Harris of Peckham, L.

Shaw of Northstead, L.

Hayhoe, L.

Simon of Glaisdale, L.

Henley, L.

Strathclyde, L.

Home, E.

Swinfen, L.

Howe of Aberavon, L.

Tebbit, L.

Howell of Guildford, L.

Thomas of Gwydir, L.

Jellicoe, E.

Trefgarne, L.

Jopling, L.

Trumpington, B.

Kimball, L.

Vinson, L.

King of Bridgwater, L.

Waddington, L.

Knight of Collingtree, B.

Wade of Chorlton, L.

Laird, L.

Wakeham, L.

Liverpool, E.

Walker of Worcester, L.

Lyell, L.

Willoughby de Broke, L.

McAlpine of West Green, L.

Wolfson, L.

NOT-CONTENTS

Acton, L.

Ampthill, L.

Addington, L.

Andrews, B.

Allenby of Megiddo, V.

Archer of Sandwell, L.

Amos, B. (Lord President)

Ashley of Stoke, L.

1057

Ashton of Upholland, B.

Livsey of Talgarth, L.

Bach, L.

Lockwood, B.

Barker, B.

Lofthouse of Pontefract, L.

Barnett, L.

Macdonald of Tradeston, L.

Bassam of Brighton, L.

McIntosh of Haringey, L.

Beaumont of Whitley, L.

McIntosh of Hudnall, B.

Berkeley, L.

MacKenzie of Culkein, L.

Bernstein of Craigweil, L.

Mackie of Benshie, L.

Bhatia, L.

McNally, L.

Billingham, B.

Maddock, B.

Boothroyd, B.

Mar and Kellie, E.

Boston of Faversham, L.

Marsh, L.

Brooke of Alverthorpe, L.

Masham of Ilton, B.

Brookman, L.

Mason of Barnsley, L.

Campbell-Savours, L.

Massey of Darwen, B.

Carter, L.

Merlyn-Rees, L.

Chandos, V.

Michie of Gallanach, B.

Christopher, L.

Miller of Chilthorne Domer, B.

Clark of Windermere, L.

Mitchell, L.

Clarke of Hampstead, L.

Morgan, L.

Clement-Jones, L.

Morris of Aberavon, L.

Clinton-Davis, L.

Morris of Manchester, L.

Cobbold, L.

Murray of Epping Forest, L.

Colville of Culross, V.

Newcastle, Bp.

Corbett of Castle Vale, L.

Northover, B.

Craig of Radley, L.

Oakeshott of Seagrove Bay, L.

Crawley, B.

Orme, L.

David, B.

Parekh, L.

Davies of Oldham, L. [Teller]

Patel, L.

Desai, L.

Patel of Blackburn, L.

Dholakia, L.

Pendry, L.

Dixon, L.

Peston, L.

Donoughue, L.

Phillips of Sudbury, L.

Dubs, L.

Pitkeathley, B.

Eatwell, L.

Ponsonby of Shulbrede, L.

Elder, L.

Prys-Davies, L.

Evans of Parkside, L.

Radice, L.

Evans of Temple Guiting, L.

Ramsay of Cartvale, B.

Ezra, L.

Randall of St. Budeaux, L.

Falconer of Thoroton, L. (Lord Chancellor)

Rea, L.

Redesdale, L.

Farrington of Ribbleton, B.

Rendell of Babergh, B.

Fearn, L.

Rennard, L.

Filkin, L.

Rodgers of Quarry Bank, L.

Finlay of Llandaff, B.

Rooker, L.

Gavron, L.

Roper, L.

Goldsmith, L.

Sainsbury of Turville, L.

Goodhart, L.

St. John of Bletso, L.

Gordon of Strathblane, L.

Sandberg, L.

Goudie, B.

Scotland of Asthal, B.

Gould of Potternewton, B.

Scott of Needham Market, B.

Graham of Edmonton, L.

Sheldon, L.

Greengross, B.

Shutt of Greetland, L.

Gregson, L.

Simon, V.

Grocott, L. [Teller]

Smith of Clifton, L.

Harris of Richmond, B.

Smith of Leigh, L.

Harrison, L.

Stallard, L.

Haskel, L.

Stern, B.

Hilton of Eggardon, B.

Stone of Blackheath, L.

Hogg of Cumbernauld, L.

Strabolgi, L.

Hollis of Heigham, B.

Strange, B.

Hooson, L.

Symons of Vernham Dean, B.

Howarth of Breckland, B.

Taverne, L.

Howells of St. Davids, B.

Temple-Morris, L.

Howie of Troon, L.

Tenby, V.

Hoyle, L.

Thomas of Gresford, L.

Hughes of Woodside, L.

Thomas of Walliswood, B.

Hunt of Chesterton, L.

Thornton, B.

Hunt of Kings Heath, L.

Tomlinson, L.

Irvine of Lairg, L.

Tordoff, L.

Jeger, B.

Triesman, L.

Jones, L.

Turnberg, L.

Kirkhill, L.

Turner of Camden, B.

Lea of Crondall, L.

Wallace of Saltaire, L.

Lester of Herne Hill, L.

Walmsley, B.

Lipsey, L.

Warner, L.

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Warwick of Undercliffe, B.

Williams of Crosby, B.

Weatherill, L.

Williams of Elvel, L.

Wedderburn of Charlton, L.

Williamson of Horton, L.

Whitaker, B.

Winston, L.

Whitty, L.

Worcester, Bp.

Wilkins, B.

Resolved in the negative, and amendment disagreed to accordingly.
4.15 p.m.
Lord Glentoran Lord Glentoran moved Amendment No. 6:
Leave out Clause 6.
The noble Lord said: My Lords, I take issue with the Attorney-General and with Clause 6, which was Clause 7 on Report, and question whether it should not more properly be struck out of the Bill.
I remember saying on Report that I accepted the Attorney-General's arguments, but would take advice from my legal team. I am here because my legal team was not satisfied with the arguments put forward by the noble and learned Lord on Report.
I shall not go through the issues at length as we have discussed them both in Committee and on Report. Unfortunately, on neither occasion did the Attorney-General and I agree. On Report I said:
"This is a new offence of influencing a prosecutor. It is neither necessary nor wise. The Government rightly realised that, for it to have legal certainty, an essential of any such criminal offence is that it must be done with the intention of perverting the course of justice. Any attempt to influence a prosecutor with such an intent is already a criminal offence at common law, and the proposed statutory offence adds nothing to it".—[Official Report, 3/2/04; col. 607.]
I beg to move.
Lord Tordoff: My Lords, it is not my intention to intervene in the substance of the discussion, but I have a procedural point to make.
It is strange that noble Lords are trying to remove a clause on Third Reading that stood part in Committee. I am sure that that is not what Third Reading is about. There may be occasions when that can happen, and this may be one of them. I do not know enough about the subject of the clause.
We must be careful about how we proceed at Thi rd Reading. I have been saying for a long time privately— and possibly publicly—that there are far too many amendments at Third Reading. Noble Lords will see that the Companion is quite strict about that. I am sure that it has been accepted by the Clerks in the general way in which the House deals with such matters. I simply want to raise a caution. Clauses that stand part in Committee should not really be struck out at Third Reading unless there is some very significant change between those two stages.
Lord Goldsmith: My Lords, the noble Lord, Lord Tordoff, has made a very important point. I doubt that this afternoon is the moment to attempt to respond to

1059
the significance of what he said, but I am sure that the fact that he said it—and that he in particular said it— needs to be considered further by those who consider the procedures of our House. If he will permit me, I shall make no further observation on it, other than that I have great sympathy with what he said.
We have debated the issue at some length. It is always a regret for any lawyer to find that other lawyers disagree with him. I explained fully in Committee and on Report my reasons why I think it proper and wise to keep the clause in the Bill. I said then, for example, that bringing the offence would require the consent of the director himself. Perhaps I should have added that there are circumstances in which the deputy director can act in his stead, but I imagine that that would be only if the director himself were away.
I do not think that I can add anything to what I have said before. The noble Lord, Lord Glentoran, dealt with the amendment very quickly and I adhere unrepentantly, I am afraid, to my views that the clause is good and proper and should be kept in the Bill. I hope that noble Lords will agree.
Lord Glentoran: My Lords, before responding to the noble and learned Lord, I should like to say to the noble Lord, Lord Tordoff, that I will certainly take note of what he said. If I have tabled an amendment that I should not have tabled, I apologise unreservedly to the House and to those concerned, and I shall seek advice from the Clerks in future with more diligence.
I know that the noble Baroness, Lady Farrington, does not want us to get involved too heavily in speeches on whether the Bill do now pass. However, as it is a Northern Ireland Bill and there is always a lot of passion and argument on Northern Ireland Bills, I should like to thank those on the Government Front Bench who have so patiently dealt with all our criticisms. I also thank my noble and learned friends and noble friends who have supported us and, last but by no means least, the officials from the department, who have been very patient with me when I have badgered and bullied them in corridors, airport lounges and other places to get more information or to change something.
I thank the noble and learned Lord for what he said, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
An amendment (privilege) made.
Baroness Amos: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Baroness Amos.)
On Question, Bill passed, and sent to the Commons.

Gender Recognition Bill [H.L.]
4.23 p.m.
Read a third time.
Clause 3 [Evidence]:
The Parliamentary Under-Secretary of State, Department for Constitutional Affairs (Lord Filkin)The Parliamentary Under-Secretary of State, Department for Constitutional Affairs (Lord Filkin) moved Amendment No. 1:
Page 3, line 1, after "by" insert "an order made by"
The noble Lord said: My Lords, on Report, the noble Lord, Lord Goodhart, made a strong case for the power conferred on the Secretary of State in Clause 3(6) to be subject to a degree of formality. The power enables the Secretary of State to specify the further content of the application form. The noble Lord proposed that the power should be exercised only by order, but that such an order need not be subject to a parliamentary procedure. He brought into question the openness of the language of the clause as it stands.
As I signalled, I wanted to reflect on that, and I now propose an amendment to Clause 3(6) so that the content of the application form for gender recognition is now set by order. In that way, we will retain the flexibility which we believe is important, while introducing the formality and transparency of an order-making process. I beg to move.
Lord Goodhart: My Lords, I am obviously most grateful to the Minister for having thought about and accepted the principle behind my argument on Report. I therefore greatly welcome the two amendments in the group.
Baroness Buscombe: My Lords, we also welcome the amendments.
On Question, amendment agreed to.
Lord Filkin Lord Filkin moved Amendment No. 2:
Page 3, line 7, leave out "impose a requirement" and insert "make an order"
On Question, amendment agreed to.
Baroness O'Cathain Baroness O'Cathain moved Amendment No. 3:
Before Clause 19, insert the following new clause—
"RELIGION

(1) A body which exists for the purposes of organised religion may, if subsection (2) is satisfied, prohibit or restrict the participation in its religious activities or ceremonies of persons whose gender has become the acquired gender under this Act.

(2) This subsection is satisfied if the prohibition is necessary to—

(a) comply with the doctrines of the religion, or

(b) avoid offending the religious susceptibilities of a significant number of the religion's followers.

(3) "Religion" means any religion, religious belief or similar philosophical belief.

(4) This section does not affect—

(a) section 19 of the Sex Discrimination Act 1975 (c. 65) (ministers of religion etc.), or

1061

(b) Article 21 of the Sex Discrimination (Northern Ireland) Order 1976 (S.I. 1976/1042 (N.I. 15)) (corresponding provision for Northern Ireland)."

The noble Baroness said: My Lords, for those who have not followed the Gender Recognition Bill during the last five debates on it, I should explain that it allows a man to become a woman or a woman to become a man, even without gender reassignment surgery. It allows a new birth certificate to be issued in the new gender, and creates a criminal offence if the original birth sex is revealed by a person in an official capacity, such as a Church leader. It is a transsexual rights Bill.
My amendment addresses the fact that Churches and religious bodies will face litigation under the Bill. How can I be so sure? Because it has already started. Already the Bill is being used to argue that transsexuals have a legal right to teach in a Sunday school and take part in any form of Church ceremony, such as marriage and worship. Already it is being used to argue that transsexuals have a legal right to take holy communion, which contravenes the teachings of particular Churches now threatened with legal action. At least two Churches have already been threatened with legal action under the Bill, even before it reaches the statute book.
A number of other Churches have been threatened with litigation by transsexuals in recent years. There was even a court case where the pastor and the entire membership of a Baptist church in south Wales were sued because a man who had had a sex-change operation was told that he could not attend a ladies' prayer meeting. Under the current law, the church succeeded in having the case thrown out. There were legal costs even though it won, but the church was not compelled to give a male transsexual the right to attend a ladies' prayer meeting. This Bill changes the legal landscape, however. There is no guarantee that the church would win the case if it came up again. It would certainly be far more costly to defend.
I received a letter yesterday from the noble Lord, Lord Filkin, for which I am grateful, in which he admits that under the Bill Churches can be taken to court over their beliefs. He says that it is the Government's opinion that such litigation "probably" would not succeed on the grounds of sex discrimination. Such litigation puts Churches under huge pressure. Members of the Baptist church to which I referred earlier were advised by their lawyer that defending the action could cost them up to £100,000, all because they would not let a man come to a ladies' prayer meeting.
My amendment is very simple. It is directly based on and mirrors the Government's own amendment—now Clause 19—which gives broad exemptions for sports bodies. The Government are prepared to amend the Bill to protect "fair competition". Can we not do the same to protect, as I suggest in the amendment, the doctrines of religion? The new Clause 19 allows sports bodies to prohibit participation of a person with a gender recognition certificate. What reason could there be for not allowing the Church an equivalent right?
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The amendment simply enshrines existing freedoms. The Government will no doubt say that those freedoms are not under threat. Ministers said the same thing to the sporting bodies, but then they changed their minds. In Grand Committee on 14 January, the noble Lord, Lord Filkin, said:
"We believe that maintaining competitive parity, or fair and safe competition, is fundamentally important, but we are not convinced that there is a problem".
Then he said:
"The Bill will not give transsexual people the general right to participate in sport in the acquired gender". [Official Report, 14/1/04; col. GC 121–122.]
He changed his mind and we now have an amendment protecting sports bodies. It gives sports bodies reassurance and greater legal certainty. That is all my amendment seeks—reassurance and greater legal certainty. If sporting competition is "fundamentally important" are not the beliefs of religious bodies equally fundamentally important?
My amendment will deter hostile litigation against religious bodies which, as we all know, often survive on a shoestring. People do not put money into the collection plate to pay lawyers. All my amendment seeks to do is to allow people of faith to worship God and conduct their own religious activities according to their own faith. Their faith teaches them that one's sex is fixed at birth and cannot be changed. That perfectly reasonable belief is very common among religious people and, indeed, among the general public as evidenced by the hundreds of letters that have been written to support the thinking behind this amendment. There are thousands of people out there who are genuinely worried about this.
The question is, should you be sued in the secular courts merely because of your beliefs and the way you worship God?
It is important to emphasise that my amendment does not affect the principle of the Bill in any way. It does not even address the fact that Church ministers face a potential criminal record and a fine of £5,000 if they tell another clergyman in their own Church that the woman in the congregation is really a man. All the amendment does is give reassurance and protection for some of the existing freedoms of religious bodies.
Churches are private bodies; they make their own rules of membership. Any private body can exclude people for all sorts of reasons. The problem is that the new legal situation under this Bill has the capacity to open up the affairs of a Church to the scrutiny of the secular courts in a way which would not apply to other private associations or groups.
It is clear from the wording of my amendment that if no offence is caused, then there is no issue. The amendment is permissive; it does not compel a Church to do anything. As a matter of fact most Churches will welcome a transsexual visiting their services to hear the Gospel. It is only where there is offence that they should be entitled to protection.
It is also clear that non-religious activities are not covered. Purely secular activities of a religious body do not come into it. The amendment is concerned only

1063
with religious activities or ceremonies, such as marriage, Communion, baptism or teaching in a Sunday school.
I believe that Churches have similarities with political parties. Like a political party, they would be nothing without freedom of association. As I understand it, the Labour Party insists that all its employees are card-carrying members of the Labour Party, and quite right too. Like a political party, the Churches maintain internal discipline. Those who reject the fundamental tenets of the organisation through words or deeds can be asked to leave. That is already the case, but that is now put in jeopardy by the Bill. Churches are private bodies but their internal affairs can be opened up to hostile litigation by the particular combination of legal rights which will result from the Bill.
A person who assumes a new sex has new human rights, thanks to the Goodwin case. Section 6 of the Human Rights Act means that you can argue that a Church is subject to these rights as a public authority in its exercise of some public functions. The transsexual also has sex discrimination rights in his or her new gender. Finally, transsexuals have rights under this Bill. But the Church, on the receiving end of litigation over marriage or membership, only has one set of rights—human rights. That is three against one.
The Bill is a completely new departure in UK law. It declares that a man must be treated as a woman "for all purposes" in law. It is illegal to discriminate on the basis of sex in the provision of goods and services. This presents absolutely no problems for Churches at the moment, but it will after this Bill.
In the south Wales case, a husband and father of three used sex discrimination law to argue that he had the legal right to join the ladies' prayer meeting. What would be the outcome of that case now? One of the Churches currently being threatened under this Bill is being told it must provide Holy Communion to a transsexual. Again, sex discrimination law is cited in addition to human rights, but also mentioned in this letter from the solicitor is the fact that this Bill is being considered in Parliament and will become an Act, thereby reinforcing the point I made about three sets of rights. Surely these are matters that should be left to the Church and not to secular courts.
We all have—at least some of us have— disagreements with our Church. I dearly wish that I could have been married in Church but because I married a divorcee I was not allowed to do so. If I go to the Roman Catholic Church 1 do not take Communion; I take it in the Anglican Church because the Roman Catholic Church makes its own rules which I respect. The Government may claim that my amendment is unnecessary, but there can be no doubt that the law will develop. Laws have a habit of developing, as we well know. Churches will be threatened; this may cost them dearly in terms of time, stress and finance—even if they win. My amendment seeks to enshrine the long-standing right of the Church to order its own religious activities and ceremonies.
1064
If a church, synagogue, mosque or temple does not want to conduct the marriage of a transsexual, it can refuse. If a Welsh chapel wants to insist that its ladies' prayer meeting is only for biological women, then it can do so without fear of litigation. Thirdly, a church can decide who can teach in a Sunday school or youth meetings without being sued. That is the effect of my amendment.
The Government believe that it is possible under this Bill for a transsexual to sue an Anglican minister over a refusal to conduct a marriage. That is why it has provided a conscience clause for Anglican clergy, but there is no conscience clause for other Churches or for the non-Christian faiths.
The Government now accept—according to the letter sent from the Minister to me—that other denominations can also be sued, but helpfully he suggests that such legal action could be resisted, using human rights arguments. In other words, they are left to their fate and the mercy of lawyers, not to mention the cost. I have also to point out that the Minister finds himself in conflict with the former Home Secretary Mr Jack Straw, who was unequivocal that Churches act as public authorities when they conduct a marriage. I refer to Hansard of 20 May 1998, col. 1017.
The Minister said that we can take a more optimistic view. Instead of leaving it to chance, surely it is our duty to give the Churches the reassurance they need on the face of the Bill.
When the European Convention on Human Rights was devised in 1952 it did not contain a section on transsexual marriage rights. The European Court confirmed that in 1998, but only four years later it reversed its position. In 2002, the Goodwin case said that transsexuals have a right to marry in their assumed gender. It would satisfy the Goodwin judgment if the Bill provided only civil marriages for transsexuals, but the Government have gone much further, in effect giving the right to religious marriages for transsexuals.
Some Churches may be content to take part in this and that is fine. But many—and I would suggest most—would not be content. Yet the ground is laid for litigation against them if they refuse. The UK courts may take a more interventionist view on these issues than the court at Strasbourg.
One government argument against protecting Churches is that there is no need to do so because the transsexuals would not want to force such issues. But that ignores the fact that there is hostility against religious groups, which is sometimes manifested in litigation.
The Government recently brought in new employment regulations to outlaw discrimination on the grounds of sexual orientation. Protections were provided for religious groups, yet even these limited protections are now being challenged in the courts. The Government are having to defend the rights of religious groups against hostile litigation. Surely, they must accept that this Bill creates scope for more of the same.

1065
The Minister says in his letter to me that he cannot guarantee that religious bodies will not face litigation. That is exactly the point. He is admitting that the Churches can be hauled through the secular courts over these issues. It really is appalling—and I say that advisedly—that the Government, it seems, are not prepared to do anything about it.
My amendment provides reassurances and protection for Christian Churches and those of other faiths. I beg to move.
4.30 p.m.
The Lord Bishop of Worcester: My Lords, I hesitate to contest an amendment moved with such evident religious conviction, but I found the noble Baroness's speech confusing at a number of points. I am not clear whether the Church, which I serve, is in her mind a private or a public authority. I am clear that it is a public authority not simply because it is, by law, established but because, to quote an example she gave, the right to exclude a person from the Holy Communion is governed by canon law, which in this country is the law of the land. So it is not clear to me that at least the Church that is served and represented by people who sit on these Benches could ever claim to be a private authority with the rights of private authorities.
Secondly, it is not at all clear to me what is meant by "a Church". Does it mean a vicar in a local parish? Does it mean a bishop in a diocese? That confines my attentions only to the Church of England. What will count as "a Church" which has these rights?
What is included in the expression "religious activities or ceremonies"? Let me offer a hypothetical situation. I decide that it would be good to celebrate the patronal festival of St James, the patronal festival of Hartlebury, with a pageant on the village green. There is present at this event, which includes the singing of hymns and the saying of prayers, someone who is known to be a transgender person and a group of people start a disturbance. As I happen to be a person who dislikes conflict—and I ask noble Lords to believe that—I conclude that it would be better to ask the transgender person to leave than to confront the people making the disturbance. It seems to me that when then challenged by the transgender person, I can say that the religious susceptibilities of the significant number of my religion's followers have been offended and it was on that basis that I acted, even though I myself would have acted purely out of timidity and not out of conviction.
Is that really the road down which we as a society wish to travel? Do we really wish to deny people the protection that we should be offering them from such behaviour and do we wish thereby, in fact and implicitly, to encourage such behaviour? I ask that those who are troubled by this matter recognise that there is a serious balancing consideration. We are talking about a relatively small group of people who have usually been on a personal journey of a nightmarish kind to the point at which they have decided to undertake the most radical life-change that any of us could imagine.
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I believe that we, as a Parliament, should be protecting such people from the kind of behaviour to which I have referred. We should also be protecting them from the arbitrary exercise of judgments by people who may or may not be qualified, except in the fact that they have a strong religious conviction, from taking the action that they take. I believe that the inclusion of the amendment introduces huge confusions as to what is a religion, what is a ceremony, what is a private body, what is a public body and what it is that we really want to protect people from.
So far—and some of us have questions even about this—we have sought only to offer the limited protection of those people who would otherwise be in jeopardy of litigation in respect of the exercise of their public office at particular public moments. That, I think, introduces a wholesale opportunity to discriminate and expose people to extremely dangerous situations. I hope that the House will reject the noble Baroness's amendment
Lord Lester of Heme Hill: My Lords, it is a privilege to speak after the right reverend Prelate the Bishop of Worcester. Your Lordships may wonder what on earth a lawyer can add to what one has just heard from the Bishop, but I want to make a couple of further points explaining why I am strongly opposed to the amendment.
I want first to clarify one matter. The only way in which the Gender Recognition Bill confers a legal entitlement on transsexuals not to be discriminated against is in the employment and related field. That is made quite clear in the Explanatory Notes, and in Schedule 6 one sees that the only parts of the Sex Discrimination Act which are modified in favour of transsexuals are the employment and related provisions. No one could bring a discrimination claim under the Bill against the Church or anyone else in the provision of services or facilities to the public. It is important to recognise that.
It has been criticised by the Joint Select Committee on Human Rights, of which I am a member. We argued that the Bill, like the Sex Discrimination Act, should have covered not only employment but the provision of goods, services and facilities to the public. Had it done so, an amendment of this kind might, if carefully tailored and much narrower, have been appropriate. In terms of the claims of transsexuals to equal treatment without discrimination, as a matter of law it is entirely inappropriate and unnecessary. That is the first matter I want to deal with.
The second matter is that in subsection (2) the amendment, like the equality regulations on sexual orientation and religious discrimination that were the subject of much controversy in your Lordships' House, allows a prohibition where it is necessary not only to,
"comply with the doctrines of the religion",
but, and alternatively, to,
"avoid offending the religious susceptibilities of a significant number of the religion's followers".

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That is a surrender to mob prejudice and group prejudice of all kinds, as the right reverend Prelate the Bishop of Worcester explained when we debated a similar exception in the employment field. I can understand an argument that makes it appropriate to comply with the doctrines of a religion in terms of the need for religious freedom. If there really is a religion that is so bigoted that it wishes to exclude or discriminate against someone who has had their gender reassigned, then perhaps there is an argument for deferring to that in striking a fair balance. But how can it be right to strike a balance by not complying with the doctrines of a religion but by the avoidance of offending the religious susceptibilities of "a significant number", whatever that means, "of the religion's followers", whatever that means? If your Lordships approve the amendment it would send a signal that your Lordships' House was in favour of that kind of mob rule, which I am certain is not the case.
Lord Tebbit: My Lords, I feel in my heart that the noble Baroness, Lady O'Cathain, is right to envisage the problems which may arise from the legislation, and that perhaps, with every respect to the right reverend Prelate, there is just a touch of complacency in some of his comments.
It is a great pity that, neither in this debate or earlier debates, have we heard the voice of Islam in this House. My friends of that faith tell me that they have grave reservations about the legislation. It is also a great pity that so many of our proceedings were undertaken while the noble Lord, Lord Patel of Blackburn, was away on pilgrimage to Mecca. It would have been most welcome to have heard his views, speaking for his religion. That would either have persuaded me that my fears were wrong, or might have persuaded the House that my fears were well founded.
When the Minister replies, I hope he will give an undertaking that if the fears expressed my noble friend Lady O'Cathain are proved to be true, despite the comments of the legal experts—and we all know that in every case half of the lawyers are wrong—if they are well founded and there are successful legal actions, the Government will come forward with amending legislation to protect the Church, even against itself.
Lord Clarke of Hampstead: My Lords, I support the amendment tabled by the noble Baroness, Lady O'Cathain. Even at this stage, I sincerely hope that my noble friend the Minister will accept it. In my limited ability, I cannot deal with the legal niceties of learned Lords or the intellectual capacity of a Bishop such as the right reverend Prelate. I can speak in the House only as a person who tries to understand matters in the simplest way. The feelings of religious groups on the subject are well known to every Member of the House. They know that from conversations on not just the Christian faith, as has just been mentioned, but on other faiths. Their views on the proposals in the Bill and the amendment are widely accepted and respected.
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For the life of me, a simple person, I cannot understand why my Government, the Government I support, are so determined to resist an amendment that clearly protects. The right reverend Prelate spoke about our duty to protect people. We also have a duty to protect religious groups and Churches. We have heard clear threats to Churches and their finances and we know of the misery that is often caused when people are dragged through the courts. The feelings of others should always be considered. Without the amendment the feelings of many people will be offended. If the noble Baroness, in the absence of the Government acting with common sense, has to test the opinion of the House, I shall willingly follow her into the Lobby. Even at such a late stage I hope that will not be necessary.
The Earl of Onslow: My Lords, I was looking at the front pages of today's Times and Daily Telegraph and now I understand why our dear, much-loved and so woolly Church of England is in such a muddle over the amendment. It has, after all, decided that the Three Wise Men are now neutered—have they been transgendered or not?
The Lord Bishop of Winchester: My Lords, perhaps I may respond briefly to the noble Earl. He needs to be wary of what he reads in particular newspapers that I shall not name, or any newspaper, on that kind of matter. But that is not why I am speaking.
I shall approach the noble Baroness's amendment by expressing my warm appreciation for the courtesy, attention and patience of the Minister and his colleagues and of his officials—the latter over many months and in many meetings long before the Bill reached your Lordships' House. Paragraph 3 of schedule 4 is, I hope, not only warmly welcome to us, but something of a first. I am grateful for his explicit assurances that such meetings can continue and that we can persevere at working not only with the Church of England but with representatives of other Churches and—as the noble Lord, Lord Tebbit, notes—to see whether acceptable ways forward can be found around the issues of disclosure and discrimination in particular.
The Minister has received two sides of a letter from me that expresses both my appreciation and anticipation of such further work and our hope that we can start on it soon. That is because—and it is appropriate to the amendment—I noted and warmly welcomed the assurance by the noble Lord:
"Clearly, in part, much of these discussions has concerned trying, if possible, to provide the proper rights to transsexual people that we clearly believe should be provided in a civilised society, and to do so in a way that does not, at the same time, infringe their right to freedom of religion and to freedom of religious expression".
He then accurately ended that paragraph by saying:
"We are debating on that cusp".—[Official Report, 3/2/04; col. 644.]
That brings me directly back to the amendment tabled by the noble Baroness. As she and other Members of the House who worked on the issue in the past weeks

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know, I have much sympathy for where the noble Baroness and those people for whom she speaks are coming from. There are matters of real concern. For me, the fact that we have not achieved some safeguards for other Churches and faiths on the face of the Bill, specifically regarding the solemnisation of marriage, is a matter of real concern. I remain, but am not very, hopeful that that question will be approached in another place. Having said that, I hope that I am not immediately disappointing the noble Baroness, because she knows that for me the amendment is quite a few steps too far. The balance of the sort that is needed, and to which the Minister referred on 3 February, is not where I should want to see it. So, although I am with the noble Baroness to a significant extent, I cannot go with her to the extent of the amendment; but I hope that several of the issues that she had in mind may be approached in further discussion, which is necessary.
While I am on my feet, I listened carefully to the noble Lord, Lord Lester, who cited the amendment and traced it back to its origins in existing legislation. In particular, he made an observation about the real difficulties that that legislation contains—that it mentions avoiding offending the religious susceptibilities of a significant number of the religion's followers. But what is "a significant number"? The Church of England, other Churches and other faiths hope to continue to work closely with the Government to attempt on this and a range of other matters to determine what the provision may mean.
Few Churches or faiths in this country or anywhere else are entirely monolithic. For me and others in the Church of England—of course, we on this Bench do not always speak with one mind—those words will prove important and we shall have to work out what they mean. It is in such areas, among others, that the careful work that I am delighted that the Minister has offered to continue will be especially welcome.
5 p.m.
Baroness Turner of Camden: My Lords, I hope that my noble friend will not feel disposed to accept the amendment. I oppose it because it seems rather intolerant. I speak as someone who is not a believer— I happen to be vice-president of the British Humanist Association—but I have always believed passionately in people's right to practice their beliefs and participate in religious ceremonies.
We are discussing a relatively small group of people who have had pretty awful experiences and may themselves be rather damaged individuals. They are the very people who are most likely to need the consolations of their religious belief. To pass an amendment that would prohibit them from expressing that religion and attending religious ceremonies is simply unkind and would add to the difficulties that such people encounter.
As noble Lords have already pointed out, new subsection (2)(b) provides for a kind of mob law to prevent those people from having the right to exercise their beliefs. I therefore hope that my noble friend will
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not feel disposed to accept the amendment. It is intolerant. Its wording is unclear: what does participation in religious activities mean? That could mean an employee engaged in selling religious artefacts in a cathedral shop, for example. That wording is far too wide and, in any event, to prohibit people from attending a religious service that may mean an enormous amount to them would be quite unkind. I hope that the amendment is not accepted.
The Earl of Erroll: My Lords, I have had more lobbying—more letters—on this issue than on either the Hunting Bill or the homosexuality clauses in other Bills. I thought that anti-discrimination legislation was to stop an individual imposing his views on others of a different nature. In general, for people of high moral principle, their religious belief is at the very core of their existence. They come together and congregate in churches. What worries me about the Bill is that it allows individuals aggressively to impose their view of the world and of their nature on such groups.
Even if the amendment is imperfect, it is necessary to include it in the Bill at this stage. I understand the reservations of the right reverend Prelate and others, but it is better to include the amendment now and then tidy it up. It should come down to congregational rather than whole Church level, because some congregations may accept the approach and some may not. We should allow that diversity in the Churches. We need the amendment included now to start the defence, because the provision can be amended in another place. The Bill should defend churches from transsexuals who would discriminate against church congregations' beliefs.
Lord Campbell of Alloway: My Lords, I shall be brief. I came to support the amendment but, having heard the speech of the right reverend Prelate the Bishop of Winchester, although I support the principle behind the amendment, I cannot support it. The principle behind it is the entitlement to have a derogation from the provisions of the Bill of generic application to all purposes recognised by law in favour of religion. That principle I adhere to. But, as the right reverend Prelate pointed out, the balance has gone wrong—especially in paragraph (b).
In our predominately Christian, multi-ethnic, multi-religious society, which is tolerant of all faiths— atheists, agnostics, Dissenters, or what have you—one ought to defer, if one can, to the authority of the established Church as an estate of the realm, which was confirmed as long ago as towards the end of the first millennium by exchange of oaths on the coronation of King Edgar
Lord Mackay of Clashfern: My Lords, I shall just say one or two things following from the observations of the noble Lord, Lord Lester of Heme Hill. He pointed out plainly that words similar to the amendment are already in the legislation of this country—no doubt subordinate legislation; but legislation nevertheless. He describes that as an illustration of mob rule, but it is mob rule, if he likes to

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call it that, that is recognised by our legislative authorities. Therefore, what he calls mob rule depends on his view that someone who objected to a transsexual taking part in a religious ceremony would necessarily be bigoted. We all understand that one difficulty about religious freedom is that what is freedom for one may appear to be bigoted to another.
It is important that this Bill already recognises in paragraph 3 of Schedule 4 the right of a clergyman not to solemnise the marriage of someone whom he reasonably believes has an acquired gender under this Act. That recognises plainly, in an important area, the religious view or attitude of a clergyman. The amendment proposed by my noble friend does not prohibit anyone from taking part in a religious service; it empowers a religious body, if that is required by the doctrines of that body, to make such a provision. It does not oblige any religious body to do so, it provides only for religious freedom.
The right reverend Prelate the Bishop of Winchester said that he would go a certain distance with this amendment, but not the whole way. The problem will be that if this amendment is rejected at this stage, it is highly likely that what he wants to happen will be somewhat difficult. I am interested to hear what the Minister will say about that and about the extent to which he is able to give undertakings about it. My understanding of the matter is that the Minister believes that religious freedom may require a religious body to have some sort of protection, but he believes— as his letter to my noble friend seems to suggest—that the secular courts will give that protection in a suitable case.
This amendment does something that requires serious consideration. If the wording needs to be improved, there is ample scope for that to be done in another place, but the principle of the amendment might well be recognised here. I support it.
Lord Monson: My Lords, the noble Lord, Lord Tebbit, is right. We have not had a chance to hear the views of Muslims on this Bill. Apart from the last speech, we have not had a chance to hear much of the views of non-conformist Christians, either. Moreover, with all deference to the right reverend Prelate the Bishop of Worcester, I suggest that his views do not necessarily reflect the views of all Anglicans.
When the Minister winds up, can he say whether— in the unfortunate event of this amendment being rejected—a woman who becomes a man will be legally entitled to demand to be trained for the Roman Catholic priesthood, and if they pass all the necessary tests and exams, will they be legally entitled to be ordained as a Roman Catholic priest?
Lord Filkin: My Lords, those who have followed this Bill from Second Reading through its stages will be aware that, quite properly, we are not coming to these issues for the first time. They have been at the centre of our proper processes of exploration and testing from Second Reading through consideration in Committee and on Report. I say to my noble friend Lord Clarke
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of Hampstead that we have been giving these issues serious consideration before the Bill was drafted and throughout its passage.
As has been said, the concern, in short, is that the Bill will compromise the freedom of religious organisations. Clearly, in what we stand for as a society, irrespective of what the Human Rights Act 1998 says, we are trying to look at two issues at the same time: a belief in the importance of freedom of worship and a very strong belief in the importance of giving legal recognition to an oppressed and ignored minority that is at the centre of this Bill. We have been working and probing with the Churches, both before this Bill came into this House and throughout its passage, the tension between those two areas and how we strike a balance.
As has been signalled, these issues are not simple; they are not easy. The Churches themselves do not speak with one voice on these matters. Is there any expectation or reason why they necessarily should? I was grateful for the way in which the right reverend Prelate the Bishop of Worcester spoke on Report, in putting what seemed to be an important balance on to some of these issues. For some of us, that chimed with what we had expected to hear from faith communities, as well as hearing the sensitive issues about concerns on some of the sharper areas.
Let me also mark that we have, through the process of reflection, discussion and consultation with faith communities—that process has been both a duty and a privilege—we have sought to listen and to move where we thought it was appropriate. We put into the Bill at First Reading an explicit exemption around marriage for ministers of the Church of England and the Church in Wales. For good reason—when they perform a marriage ceremony, ministers of the Church of England and the Church in Wales are effecting a civil function as well as a religious one. The burdens on them are therefore explicitly strong. Without that exemption they would have been caught. We made that provision explicit so that clergymen were exempt in conscience, if they wished to be so, from any challenge to them if they did not wish to carry out a marriage.
Since the Bill was introduced, we have gone further and amended the provision to protect further those ministers otherwise obliged to solemnise marriages, extending the conscience clause to a situation where a clergyman reasonably believes that one of the parties to the marriage has been recognised in the acquired gender. We have listened to the arguments put to us and were open to the point that there might be circumstances where a clergyman had reasonable grounds for belief that the information had not been disclosed, and that they were protected in those circumstances if they said, "No, I am sorry, I do not wish to solemnise a marriage for you". In this case, we are talking about Anglican clergy. Therefore, we have been listening. I have been glad to meet the noble Baroness, Lady O'Cathain, and others, along with my officials to explore the issues.

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The issues turn on two sets of arguments: moral and legal. I shall be cautious about what I say about the moral arguments, because perhaps government Ministers should confine themselves to the law on such issues. The question of whether religious organisations ought to exclude transsexual people from participation in religious activities is certainly at bottom a moral argument. However, I say from the government Front Bench that one hopes as a society, given the importance that we place on tolerance, that in most situations religious organisations would not wish to discriminate against transsexuals but would recognise the humanity in them and welcome them as part of their faith community. I shall say no more on that.
It is therefore open to a religious community to decide whether it wishes—I was surprised to hear it— to say that it will refuse to administer Holy Communion to a human being in those circumstances. At heart, however, that is not a matter for me, but for them. It is a matter for me only in my private life, when I have opportunities elsewhere to argue those points.
On the legal arguments, I shall address first the solemnisation of marriage. The issue at heart is that no minister of religion other than an Anglican clergyman—a Muslim or Baptist minister, for example—is obliged by law to solemnise a marriage. Nothing in the Bill changes that; they are at perfect liberty to continue to refuse to solemnise a marriage of anyone whom they know or believe to be a transsexual. There is no catch to them as regards the freedom of action that they already have. I know from our many discussions that the noble Baroness, Lady O'Cathain, understands that point. Without boring the House by discussing the public function issue in detail, the reason is that, apart from in the Church of England or the Church of Wales, when solemnising a marriage, a cleric would not be considered to be exercising a public function. They are not public authorities in that context; therefore, they are not subject to the obligations of the Human Rights Act 1998.
The second area of debate is access to facilities. The short answer, on which the noble Lord, Lord Lester of Heme Hill, was clear and crisp, is that the Bill does nothing to change discrimination legislation. It has been a source of criticism from some Benches that it does nothing to change the law. It is a matter of fact that it does nothing to change the law; therefore, discriminatory action that was legal before the enactment of the Bill is still legal afterwards. The current situation whereby a Church might be able to be taken to court by an aggrieved person because it has or has not done something will not change after the Bill has been enacted. I cannot believe that the noble Baroness, Lady O'Cathain, said that in some ways the Churches can never be taken to court as a result of any of their actions. That would be either to reinstate the Church courts or to create a theocracy. That cannot be the argumentation.
The central point is that the Bill does nothing to change discrimination law. We have explained on several occasions why that is. Essentially, it is about a narrow focus giving legal recognition to a very small
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group of people after they have gone through a proper process of testing to recognise their change of gender. We have indicated further that the European Union has signalled, under the terms of its draft sex discrimination directive, that it is looking at the issue of sex discrimination across Europe. For good reason, we have said that issues about where discrimination should or should not be allowed to take place should be examined as part of that process, to avoid taking two bites of the cherry. We should be having this debate in the future, not now, as we are not changing the law in this respect.
Lord Tebbit: My Lords, I am grateful to the Minister. Of course, the noble Lord correctly says that we are not changing the law on sex discrimination. But what he omits to say is that in the past there has never been any dispute as to the sex of persons. We now have a situation where there will be a group of persons who will claim a sex which a number of other people will say is not their sex. That is where the new problem arises without having changed the law on discrimination between male and female
Lord Filkin: My Lords, I thank the noble Lord, Lord Tebbit, for his intervention. I also mark the resolute way in which he has argued his corner throughout the Bill. The short answer is that the Bill does nothing to change the law about discrimination against people as transsexuals. We are talking about discrimination against them as transsexuals rather than discrimination against them on account of their sex. If the noble Lord is patient with me, I shall seek—
Lord Lester of Heme Hill: My Lords, I am grateful to the Minister for giving way. The Minister has said several times that this does not change the law on sex discrimination. But that is not quite right, is it? It changes it in the employment field. The point is that the amendment does not touch employment. It does that by embracing the employment provisions of the Sex Discrimination Act for transsexuals.
Lord Filkin: My Lords, at earlier stages, I signalled that employment was different and that it was. a specific area. I acknowledge the point made by the noble Lord, Lord Lester, in that respect. In fact, if I had only waited: the present protection exists only in the realm of employment and vocational training. The moral of that is that it is always better to use one's speaking notes than to speak off the cuff.
It does not extend to participation in religious activities. In effect, it means that the freedom for religious organisations to discriminate against transsexuals sought by this amendment already exists. Many will say that it should not, but that is not what we are debating. In fact, the ability to discriminate is there in law already.
The Bill ensures that, as a consequence of recognition, a person is protected under sex discrimination law in the acquired gender. However, religious organisations, as in the many examples given, will not be discriminating against a person who has

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changed gender on grounds of his or her sex, but on the grounds that he or she is a transsexual person. We do not believe—we are strong in our view that sex discrimination law will restrict the freedom of religious organisations in this matter.
The noble Baroness suggested that differential treatment of transsexual people might be considered to be sex discrimination. This is on the basis that, for example, a female-to-male transsexual person with a gender recognition certificate would be allowed to use the ladies' toilet facilities, but a male-to-female transsexual person would not. I find it difficult to see that a church would wish the female-to-male transsexual person to use the ladies' toilet, but that is the noble Baroness's assumption. Even if that were the scenario, we do not think that the courts would accept that that was discrimination on the grounds of sex. The courts have demonstrated that they are not prepared to stretch provisions about sex discrimination in order to prohibit action, which is in fact discrimination on a ground other than sex. That would be the case here. What is described is clearly discrimination on the basis of the individual having changed gender.
Before I move on to the specifics of other issues that were raised, perhaps I may respond explicitly to the points made by the noble Lord, Lord Clarke of Hampstead, and the right reverend Prelate the Bishop of Winchester. Previously, I have given undertakings that as part of the Government's process of looking at the application of the shaping of EU legislation and its application into domestic law, we will continue with our close discussions. I repeat that.
We would be happy to talk with the Churches about the implementation of the legislation when it is passed. The Churches will understand that, as I have signalled previously, that is not to sign a blank cheque, but it is within the broad policy framework that we have signalled. I think that is understood, so I am pleased to give that reassurance.
I was asked about the sport exemption, which does not exclude transsexual people as a class. It refers only to those people who have a competitive advantage or where there would be a threat to the safety of others. Religious organisations, unlike sporting bodies in this context, are not public bodies and, hence, the Human Rights Act does not apply to them in this way. I could say more, but perhaps we have said it at previous stages.
In short, nothing in the Bill—with the exception of which the noble Lord, Lord Lester, has reminded me—changes the law on discrimination. It is possible that future law may address those issues, and we shall be pleased to work with the Churches and the faith communities to explore them. We have been pleased to make some significant movement on the Bill in order to address the areas in which we feel there is a just case for the Churches to be listened to. But at the heart of the Bill is the concept of giving legal recognition to a very small number of people who for much of their lives have felt a fundamental discontinuity in their lives. After a proper process of testing, we believe that
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it is right that the state should give them that legal recognition. I therefore ask the House to reject the amendment.
The Lord Bishop of Winchester: My Lords, before the Minister sits down, will he respond to the question from the Cross Benches about the position of a postulant for the Roman Catholic priesthood?
Lord Filkin: My Lords, I apologise for not having done so previously. If I recollect correctly, the noble Lord, Lord Monson, asked the question. The position is that in the circumstances to which the noble Lord referred, the Roman Catholic Church would be totally at liberty to refuse ordination and would not be open to an action.
Baroness O'Cathain: My Lords, I thank the noble Lords who have spoken on the Bill, particularly those who have supported me, and I thank the Minister for his reply.
I reiterate that my amendment in no way changes the principle of the Bill. It certainly does not attempt to be intolerant. I fear that those who suggest that it will lead to mob rule have not understood where I am coming from. Perhaps I have not made it clear enough. However, I was rather surprised by some of the reaction. I shall not deal with all the points that have been raised, but I should reply to some that were made by noble Lords who object to the Bill.
First, I believe that the scenario suggested by the right reverend Prelate the Bishop of Worcester about the patronal festival of St James is unlikely to be covered by this amendment. I feel that the right reverend Prelate should not distract from the purpose of the amendment, which is to provide reassurance and greater legal certainty for the Church. We should concern ourselves with the rights of all religions, both Christian denominations and others, and should protect their freedom to decide what they do in their own churches.
I turn to the comments made by the noble Lord, Lord Lester. His points could be covered by my statement that the Bill is all about balancing rights. I believe that this amendment is necessary to balance the rights of Churches against those of transsexuals. That is not to say that I have anything against transsexuals. I am extremely supportive of the compassionate feeling for them. It is always difficult to be the odd one out. I have known about being the odd one out, though not to such an extent. We can all feel isolated in certain circumstances. Transsexuals can feel isolated, and it is right that we should give them every support. However, it is right that those people who have strong beliefs should also be given support.
The Bill provides some protection for religious people who believe that your true sex is the sex that you were born with. On issue, a male transsexual is always a man and a female transsexual is always a woman. But the Minister's point that in terms of marriage any church minister or Muslim minister can be protected is not covered by the Bill—only ministers of the Church of England and the Church of Wales are covered.

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The Government did not deny that church ministers could be sued if they refused to conduct such marriages, and that is why they seek the inclusion of a conscience clause. I want to strike a balance here. If provision is made for ministers of the Churches of England and Wales, why not for Roman Catholics, Baptists, for other non-conformist Christian denominations, for those of the Jewish and Muslim faiths and all others? The Government now admit that other religious groups could be sued, a point I made earlier. I take the view that other Churches and non-Christian faiths need the protections given to the Churches of England and Wales.
A recent Law Lords ruling found that a church marriage performs a governmental function. When people get married in church, the Church is acting in place of the state and is therefore open to challenge under human rights legislation. What we are considering today is no academic debate. Instead of a legal argument in your Lordships' House, under the Bill there will be costly legal arguments in the courts. A vote for my amendment is a vote to defend our existing religious freedoms from hostile and expensive litigation.
Before the Bill was even printed, several Churches had been threatened. I referred to one court case when moving my amendment. A man sued a Church citing sex discrimination legislation. I ask: is access to a ladies' prayer meeting to be defined as "goods and services" under the terms of the sex discrimination Acts? Let us not forget that some of the people who will receive, as they want, gender recognition certificates, rendering their original birth certificates null and void except in the case of the police and criminal prosecution bodies—they have the right to use the original documents—need not have had gender reassignment surgery. It is rather feeble to say that if a male transsexual becomes a woman, he may use the ladies' lavatory and not cause distress. I put it at its simplest.
The Bill is being used as a means to threaten legal action against Churches. The fundamental question is: are Churches to be protected? The Minister has said no. The Government are prepared to protect sporting bodies, but not Churches. I welcome the Minister's reiteration that there will be ongoing discussion and debate about the Bill, but the Bill will leave this House tonight. What influence will we have? We are not actually "Top of the Pops" for the people down the corridor.
This Bill enables a battery of legal rights to be deployed against a Church. A secular court will be able to adjudicate on the most precious belief; that of religious belief. The Government say that the Bill is necessary to protect the rights of 5,000 transsexual people. I say again that we all understand their difficulties and we want to see them treated with the utmost compassion. But what about compassion for the millions of people who do not want their most precious religious beliefs trampled upon by the courts?
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To those who say that they speak for society by supporting the Bill as originally published, I say, look at the postbags of many Members of your Lordships' House. They show the real concern felt among the general public about the issue of religious liberty. To those who approve of the Bill, I say that my amendment does not affect the principle here, it merely gives to Churches the same freedoms which the Government have already given to sporting bodies. I urge noble Lords to vote to protect religious freedoms and I wish to test the opinion of the House.
5.34 p.m.
On Question, Whether the said amendment (No. 3) shall be agreed to?
Their Lordships divided: Contents, 144; Not-Contents, 149.

Division No. 3

CONTENTS

Ackner, L.

Gardner of Parkes, B.

Ahmed, L.

Glentoran, L.

Allenby of Megiddo, V.

Goschen, V.

Ampthill, L.

Gray of Contin, L.

Armstrong of Ilminster, L.

Greenway, L.

Arran, E.

Griffiths of Fforestfach, L.

Attlee, E.

Harris of High Cross, L.

Bagri, L.

Harris of Peckham, L.

Blackwell, L.

Hayhoe, L.

Blaker, L.

Henley, L.

Boothroyd, B.

Home, E.

Boyce, L.

Hooson, L.

Brennan, L.

Howe, E.

Bridgeman, V.

Howell of Guildford, L.

Bridges, L.

Hunt of Wirral, L.

Brooke of Sutton Mandeville, L.

Hussey of North Bradley, L.

Brookeborough, V.

Jauncey of Tullichettle, L.

Brookman, L.

Jopling, L.

Brougham and Vaux, L.

Kimball, L.

Byford, B.

Kingsland, L.

Caithness, E.

Kirkhill, L.

Carnegy of Lour, B.

Knight of Collingtree, B.

Chalfont, L.

Laird, L.

Chan, L.

Lindsay, E.

Clarke of Hampstead, L.

Liverpool, E.

Cobbold, L.

Lofthouse of Pontefract, L.

Cockfield, L.

Lucas, L.

Coe, L.

Luke, L.

Colville of Culross, V.

Lyell, L.

Colwyn, L.

McColl of Dulwich, L.

Cooke of Islandreagh, L.

Mackay of Clashfern, L.

Cope of Berkeley, L.

Maginnis of Drumglass, L.

Courtown, E.

Marlesford, L.

Cox, B.

Masham of Ilton, B.

Craig of Radley, L.

Mason of Barnsley, L.

Cuckney, L.

Mayhew of Twysden, L.

Davies of Coity, L.

Miller of Hendon, B.

Dearing, L.

Molyneaux of Killead, L.

Denham, L.

Monson, L.

Dixon, L.

Montrose, D.

Dixon-Smith, L.

Moran, L.

Donoughue, L.

Mowbray and Stourton, L.

Dundee, E.

Moynihan, L.

Elles, B.

Murton of Lindisfarne, L.

Emerton, B.

Newton of Braintree, L.

Erroll, E.

Northbrook, L.

Feldman, L.

Northesk, E.

Finlay of Llandaff, B.

O'Cathain, B. [Teller]

Fitt, L.

Onslow, E.

Fowler, L.

Oppenheim-Barnes, B.

1079

Palmer, L. [Teller]

Stewartby, L.

Pearson of Rannoch, L.

Stoddart of Swindon, L.

Pilkington of Oxenford, L.

Strange, B.

Platt of Writtle, B.

Strathclyde, L.

Plumb, L.

Swinfen, L.

Plummer of St. Marylebone, L.

Tebbit, L.

Quinton, L.

Tenby, V.

Rawlinson of Ewell, L.

Thomas of Gwydir, L.

Reay, L.

Tombs, L.

Rees, L.

Trefgarne, L.

Rees-Mogg, L.

Trumpington, B.

Roberts of Conwy, L.

Vinson, L.

Rotherwick, L.

Waddington, L.

St. John of Bletso, L.

Wade of Chorlton, L.

Sanderson of Bowden, L.

Wakeham, L.

Seccombe, B.

Walker of Worcester, L.

Selborne, E.

Walpole, L.

Selsdon, L.

Weatherill, L.

Shaw of Northstead, L.

Williamson of Horton, L.

Shrewsbury, E.

Willoughby de Broke, L.

Simon of Glaisdale, L.

Windlesham, L.

Skelmersdale, L.

Wolfson, L.

NOT-CONTENTS

Acton, L.

Greengross, B.

Addington, L.

Grocott, L. [Teller]

Alli, L.

Hamwee, B.

Amos, B. (Lord President)

Harris of Haringey, L.

Andrews, B.

Harris of Richmond, B.

Archer of Sandwell, L.

Harrison, L.

Bach, L.

Haskins, L.

Barker, B.

Hilton of Eggardon, B.

Barnett, L.

Hogg of Cumbernauld, L.

Bassam of Brighton, L.

Hollis of Heigham, B.

Beaumont of Whitley, L.

Howarth of Breckland, B.

Berkeley, L.

Howe of Idlicote, B.

Bernstein of Craigweil, L.

Howells of St. Davids, B.

Bhatia, L.

Hoyle, L.

Billingham, B.

Hughes of Woodside, L.

Blackstone, B.

Hunt of Chesterton, L.

Borrie, L.

Hunt of Kings Heath, L.

Bragg, L.

Irvine of Lairg, L.

Brooke of Alverthorpe, L.

Janner of Braunstone, L.

Burlison, L.

Jeger, B.

Campbell-Savours, L.

Jones, L.

Carter, L.

Judd, L.

Chandos, V.

King of West Bromwich, L.

Christopher, L.

Layard, L.

Clark of Windermere, L.

Lea of Crondall, L.

Clement-Jones, L.

Lester of Herne Hill, L.

Clinton-Davis, L.

Linklater of Butterstone, B.

Cohen of Pimlico, B.

Lipsey, L.

Corbett of Castle Vale, L.

Lockwood, B.

Crawley, B.

McAlpine of West Green, L.

David, B.

Macdonald of Tradeston, L.

Davies of Oldham, L. [Teller]

McIntosh of Haringey, L.

Dean of Thornton-le-Fylde, B.

McIntosh of Hudnall, B.

Desai, L.

MacKenzie of Culkein, L.

Dholakia, L.

Mackie of Benshie, L.

Dubs, L.

Manchester, Bp.

Elder, L.

Mar and Kellie, E.

Evans of Temple Guiting, L.

Marsh, L.

Ezra, L.

Merlyn-Rees, L.

Farrington of Ribbleton, B.

Miller of Chilthorne Domer, B.

Faulkner of Worcester, L.

Mishcon, L.

Filkin, L.

Mitchell, L.

Fookes, B.

Morgan, L.

Gavron, L.

Murray of Epping Forest, L.

Goldsmith, L.

Newby, L.

Goodhart, L.

Newcastle, Bp.

Gordon of Strathblane, L.

Northover, B.

Goudie, B.

Oakeshott of Seagrove Bay, L.

Gould of Potternewton, B.

Ouseley, L.

Graham of Edmonton, L.

Parekh, L.

Grantchester, L.

Patel, L.

1080

Patel of Blackburn, L.

Smith of Clifton, L.

Pendry, L.

Smith of Leigh, L.

Peston, L.

Stern, B.

Phillips of Sudbury, L.

stone of Blackheath, L.

Pitkeathley, B.

Symons of Vernham Dean, B.

Prys-Davies, L.

Temple-Morris, L.

Puttnam, L.

Thomas of Gresford, L.

Radice, L.

Thomas of Walliswood, B.

Ramsay of Cartvale, B.

Thornton, B.

Randall of St. Budeaux, L.

Tomlinson, L.

Redesdale, L.

Triesman, L.

Rendell of Babergh, B.

Turnberg, L.

Rennard, L.

Turner of Camden, B.

Rodgers of Quarry Bank, L.

Wallace of Saltaire, L.

Roper, L.

Walmsley, B.

Russell-Johnston, L.

Warner, L.

Sainsbury of Turville, L.

Warwick of Underclifie, B.

Sandwich, E.

Whitaker, B.

Sawyer, L.

Whitty, L.

Scotland of Asthal, B.

Wilkins, B.

Scott of Needham Market, B.

Williams of Elvel, L.

Sharp of Guildford, B.

Winston, L.

Sheldon, L.

Worcester, Bp.

Simon, V.

Resolved in the negative, and amendment disagreed to accordingly.
5.45 p.m.
Clause 22 [Prohibition on disclosure of information]:
Lord Marlesford Lord Marlesford moved Amendment No. 4.
Leave out Clause 22.
The noble Lord said: My Lords, I am relieved that my amendment is less intellectually complicated and certainly less philosophically challenging than thediscussions that we have had. Therefore, I hope that I can speak reasonably briefly to it. The amendment seeks to remove Clause 22 from the Bill. To do so would have no effect on the general purpose of the Bill, which is to give official recognition to those who have changed gender. Indeed, I, like other noble Lords, have great sympathy for those who suffer from the medical condition known as gender dysphoria.
Clause 22 makes it a criminal offence for certain categories of people to reveal that a person has changed gender. I believe that Parliament should be wary of creating additional criminal offences; there are quite enough already. Each additional offence, before it is passed, should be subjected to certain, rather obvious, tests. First, is it necessary? Secondly, would it achieve the purpose stated? Thirdly, is it enforceable? Fourthly, do the law enforcement agencies have sufficient resources to enforce it?
I do not believe that Clause 22 is necessary. Those people who come across information on gender change in their official capacities, whether, for example, they be medical people or civil servants, are already bound by ethical conventions, professional rules and laws of confidentiality. No doctor or nurse gossips about his or her patients. Civil servants are bound by the Official Secrets Acts 1911 and 1989. Last

1081
week, when we had a brief discussion on this amendment, which I did not then move, the Minister, the noble Baroness, Lady Hollis of Heigham, said:
"Respect for a person's private life means that we must alleviate some of the dangers of humiliation, embarrassment and harassment … being reminded of the original gender, being confronted by it regularly, having others knowing that you suffer from the medical condition and knowing that they might be talking about it is [not] conducive to feeling secure".—[Official Report, 3/2/04; col. 665.]
That is absolutely true. Indeed, it applies to many medical conditions, especially sexual or psychological conditions.
Clause 22 does not deal with that. The Minister, the noble Lord, Lord Filkin, very kindly wrote to me yesterday to explain:
"Clause 22 only applies when information is acquired in 'an official capacity'. No doubt this does mean that gossip and rumour about a person's gender history can continue and is not unlawful when it is conducted by people who have acquired the information in a private capacity … The state should not, for the most part, seek to interfere in the content of conversations that take place between friends and neighbours, in coffee shops and living rooms. Any such prohibition would also be almost impossible to police and it would be very difficult to gather enough evidence for the purposes of a trial".
Quite so. The clause does not cover malicious gossip, but it does cover a wide range of people, other than civil servants, who might have totally legitimate reasons for needing to know. It covers anyone involved as an employer, or prospective employer, in the slightly quaint words, anybody involved in "the conduct of business".
If we were talking about employment law on the grounds of gender, as we have heard from the noble Lord, Lord Lester, and from other noble Lords, we already have legislation to protect from discrimination. In his letter the noble Lord, Lord Filkin, tells me that this clause is required by Article 8 of the European Convention on Human Rights.
Article 8 merely states:
"Everyone has the right to respect for his private and family life, his home and his correspondence",
and then goes on to list exemptions from that right. If we were to legislate to enact the very general provisions of Article 8, almost every Bill would need a Clause 22. Clause 22 does not provide privacy protection where it could be needed, but offers it where it is already provided for. In cases in which anyone might wish to enforce the provision, it would difficult to prove the case, and would use considerable resources that are scarce and needed for the protection of people from real crimes. Such resources would probably be used for little purpose.
With the best intentions, the Government have got themselves into several muddles over this Bill. Indeed, I suspect that they wish that they had tackled the need, which I accept, for official recognition of gender change by a much simpler administrative action. By removing Clause 22, the Bill would fulfil its intention and be a much better one. 1 beg to move.
Lord Lester of Heme Hill: My Lords, it may be helpful if I draw to the attention of the House the fact that the Joint Select Committee on Human Rights
1082
dealt with this matter in our fourth report, when we considered a complaint by the Evangelical Alliance. Those who lead the sort of sad lives that involve reading such documents might be interested to know about the issue. Paragraph 4.38 states:
"the Evangelical Alliance argued that the provisions protecting the privacy of those who have acquired a new gender would violate the right of others under ECHR Article 10"—
the free speech guarantee—
"to receive truthful information about a person's gender".
We unanimously—all-party and beyond party— concluded that that argument was unpersuasive.
We first dealt with why Article 10 was not really triggered. We then came to the view that free speech rights had to be balanced against the Article 10 rights of the transsexual person and decided that any court would probably conclude that the clause is,
"a proportionate response to a pressing social need…for (the purpose of protecting the right of the transsexual person to respect for his or her private life under that paragraph, as determined in judgments of the European Court of Human Rights".
I listened very carefully to the noble Lord, Lord Marlesford, and respectfully say that I do not agree with him. This type of provision is particularly necessary in this Bill because we are concerned with respect for the private lives of this small category of vulnerable persons against the possibility of information being transmitted by persons in an official capacity or by employers in an unnecessary or disproportionate way. Clause 22 carefully balances the need to respect personal privacy against other rights and interests, because Clause 22(4) sets out a variety of circumstances in which it would not be an offence to disclose protected information relating to the individual.
I have carefully considered—as has the Joint Select Committee on Human Rights—the way in which the clause is drafted. We believe that the Bill as a whole is designed to promote rather than invade fundamental rights and freedoms. We conclude that the clause strikes a fair balance and is necessary in order to comply with Article 8 of the convention.
Lord Tebbit: My Lords, I rise briefly to support my noble friend Lord Marlesford. When the matter was discussed at an earlier stage, fears were aroused that reporters from the tabloid press would go fishing around trying to discover from registrars of births and deaths whether they knew of anyone who fell into the category of transgender persons who had been issued with new birth certificates falsely purporting that they had been born male when they were born female, or vice versa.
The Government have decided that they must ensure as best they can that no registrar or any other person in possession of such information in an official capacity should leak it. I do not know how many noble Lords know very much about the tabloid press. I confess that I have a nodding acquaintance with it—a closer one than the Secretary of State for Defence does, as recent events show. Most of the information that the tabloid press has is picked up in the pub from people who have picked it up somewhere else along the way.

1083
Who will know and be legally empowered to pass on such information? They will be the workmates, friends or the family of such a person. That is the very area where the reporter or stringer from a tabloid paper picks up his information. Above all, Clause 22 will be ineffective in protecting the person. All it will do is punish an official, such as a registrar of births and deaths, for revealing the fact that somebody was born a girl although the birth certificate says that the person was born a boy.
That is it. It is a very heavy sledgehammer to attempt to crack a nut, particularly when the people most likely to discuss such matters and to talk about them to the press are not covered by the clause. The noble Lord is right that the clause is objectionable and needs to be thrown out.
Lord Selsdon: My Lords, I am a little worried because of the international requirements regarding birth certificates. For example, in the Middle East where I have been many times, one often has to produce one's birth certificate and that of one's parents. If someone changes his birth certificate, it has to be changed all the way back through the line.
I do not want to make a speech like that of the noble Earl, Lord Ferrers, on such issues, but it is complicated to know who you are these days. Around the continent of Europe there are only two names. The noble and learned Lord the Lord Chancellor, would be known as "Falconer, Charlie". His birth certificate would also be required—but he was probably not a Lord at that time—because a passport is not necessarily proof of identity. I have found that because the first part of my name is sometimes given as, "The right", I am known as "Monsieur Right The". The last bit of my title is "of Croydon", so I am called, "Croydon Of—Of being a Norwegian Christian name.
We therefore need to think right the way through the history of the birth certificate. That applies inevitably to some hereditary Peers whose father at the time of their birth were not called "Lord this or that" because their grandfathers were alive. Once the chain is broken by a change in a birth certificate it could be deemed to be extremely fraudulent in certain countries.
I believe that such a clause should not be necessary because common decency should prevail. It is only when people follow indecent thoughts that decency does not prevail. I am therefore inclined to support my noble friend Lord Marlesford as the provision seems extraordinarily complicated. I wonder whether the Government have thought through the question of proof of identity and the requirement for the birth certificates of two or three generations.
Lord Stoddart of Swindon: My Lords, this is the first and only time that I shall speak in this debate. I do so simply to say that I believe that the Bill is entirely unnecessary, and has proved to be divisive. I wish that, in considering the interests of minorities, we might also
1084
consider the interests of majorities. Perhaps we ought to have a conglomerate Bill to protect the interests of majorities.
I was surprised when I received a Written Answer to a Question asking the Government to provide information on how many new criminal offences had been instituted and passed by Parliament since 1997, because that information was not kept centrally. In fact, we are going along willy-nilly, making more and more offences and increasing the penalties for offences, but the Government—and probably the previous government as well—simply do not know how many offences there are for people to commit and what offences have had their penalties increased. I find that impossible to believe, but it is unfortunately the truth.
I am concerned about the Bill and the unjoined-up government that brings forward such Bills. I am against the Bill; I have been against the Bill since it had its First Reading. However, I have kept relatively quiet about it because, if I objected to every Bill, I would be up 24 hours a day examining them and making speeches about them, either in Grand Committee or here. I shall concentrate my attention on the amendment, which I shall support for the reasons put forward by the noble Lord, Lord Marlesford, and others.
The only point that I want to make about the clause is about its subsection (5), which states:
"The Secretary of State may by order make provision prescribing circumstances in which the disclosure of protected information is not to constitute an offence under this section".
That sounds very reasonable—except that everything else that the Government have not thought to put in subsection (5) will be an offence. I would like an explanation from the Minister about what that subsection means. A court that looked at it and the list of offences that are excluded would be bound to conclude that every other possible offence was included. After what I have said, I hope that he will be able to help me on that small matter.
6 p.m.
Lord Filkin: My Lords, those who have contributed to debates on the Bill in its earlier stages will be well aware why the clause matters. In itself, it goes to the heart of why the Bill matters, as it essentially deals with the importance of ensuring—albeit belatedly in the United Kingdom's case—that the gender change of people who have had or have gender dysphoria and have been in that condition for a period of time should, after a proper process of testing, be recognised by the state. We are one of only two members of the European Union that do not do that now, and it is about time that we rectified that.
The clause is an important part of the Bill because the Bill is essentially about trying to allow people who meet its tests to live their lives in peace, quiet and decency in future. There is a limit to what the state can do in that respect, as I signalled in the letter to the noble Lord, Lord Marlesford. However, what we can do. we should do, which is why the clause is in the Bill.

1085
Let me set out why it is necessary and why, as the noble Lord, Lord Lester, so clearly said, it is also proportionate to meeting our human rights obligations.
The clause is intended to ensure that the disclosure of personal information without the consent of the person in question must be restricted; if not, we would fail the person's right to respect for private life under Article 8. As the Bill is clearly structured, it signals that all human rights legislation has to strike a balance between one set of rights for one individual with rights and freedoms for others. Therefore the right and freedom in this respect are governed and limited by the prohibitions on disclosure in a number of important respects. The privacy protection does not hamper the detection or investigation of crime; it does not prevent the Criminal Records Bureau from carrying out its functions. The prohibition will not, therefore, assist a transsexual person who is also committed to a life of crime from being identified or detected. Similarly, disclosure is permitted where it is for the purpose of proceedings before a court or tribunal. It is also permitted where it is made in accordance with or by virtue of a statutory provision. Clause 22 will therefore not prevent members of the Civil Service or other public bodies from carrying out their statutory functions.
Clause 22 makes quite clear that disclosure may be made with the consent of the person to whom the information relates. This means that a person may be asked as to his or her gender history and, with his or her agreement, the information may be passed on to others who may need it.
Clause 22 also has another important limit. Not only does it enumerate a list of exceptions that allow disclosure where it is justified in public policy, it also extends only to information that is acquired in an official capacity. Clause 22 does not, therefore, cause harm to the liberty of individuals acting in a private capacity. It does not intrude into the private sphere. It would not be proper for the state to start poking into the content of conversations, as I indicated in the letter that I wrote to the noble Lord, Lord Marlesford.
On the one hand, there is the right of transsexual people to respect for their private lives, their interest in personal security and some level of control over what is sensitive personal information. On the other hand, by including specific exemptions and by staying out of the private sphere, the rights and freedoms of others are protected. Clause 22 and its subordinate limits have been carefully balanced to meet both our obligations under the Human Rights Act and our obligations in terms of decency and the rights of others.
Why does it matter? I can do little better than to draw the House's attention to a tragic article in the Guardian on 12 May. With the leave of the House, I shall refer to it briefly. It is about prejudice against a transsexual who committed suicide as a result of 10 years of prejudice against her. I do not claim that the clause will stop gossip, malice, evil or ordinary human beings from behaving in thoughtless ways that do
1086
damage, but we have an obligation as a state to seek to ensure that public officials or people acting in a public role are not part of that process. In that small and limited way we should so act.
I will not weary the House, but it is a tragic example of a person who experienced 10 years of harassment, vilification, physical assault and abuse on her house, which eventually drove her to commit suicide. In our small way— this is what the clause does—we have an obligation to act. Therefore I hope that the noble Lord, Lord Marlesford, will respect why we believe that this is an important measure and that, therefore, we do not support his amendment.
Lord Marlesford: My Lords, I am grateful to the Minister for his comments. I felt, frankly, that he very largely made my case, because he emphasised again the areas that the clause does not cover and that will not be helped by it. He referred to a tragic case which would almost certainly—although I do not know further details—come into that category.
I am sure that the noble Lord, Lord Lester of Herne Hill, would like to have every Bill with a Clause 22. There can be few examples that he would not be able to give where almost every clause of the Human Rights Act ought to apply if it does not already. Frankly, I was not convinced by the Minister.
Parliament has been increasingly criticised for its failure to put the executive right. In fact, that is one of the arguments increasingly put forward for the growing power of the media. I believe that in this small example we have the opportunity of correcting a nonsense and removing what I see as an ineffective and profoundly illiberal clause. I therefore invite noble Lords from all parts of the House to join me in the Lobby in removing it.
6.9 p.m
On Question, Whether the said amendment (No. 4) shall be agreed to?
Their Lordships divided: Contents, 108; Not-Contents, 145.

Division No. 4

CONTENTS

Astor of Hever, L.

Cox, B.

Bagri, L.

Crickhowell, L.

Blackwell, L.

Davies of Coity, L.

Boothroyd, B.

Denham, L.

Bridgeman, V.

Dixon-Smith, L.

Bridges, L.

Donoughue, L.

Brooke of Sutton Mandeville, L.

Dundee, E.

Brookeborough, V.

Eccles of Moulton, B.

Burnham, L.

Elton, L.

Byford, B.

Erroll, E.

Caithness, E.

Feldman, L.

Campbell of Alloway, L.

Fitt, L.

Carnegy of Lour, B.

Fookes, B.

Chalfont, L.

Freeman, L.

Coe, L.

Glentoran, L.

Colwyn, L.

Gray of Contin, L.

Cooke of Islandreagh, L.

Harris of High Cross, L.

Cope of Berkeley, L.

Harris of Peckham, L.

Courtown, E.

Hayhoe, L.

1087

Hodgson of Astley Abbotts, L.

Pearson of Rannoch, L.

Home, E.

Phillips of Sudbury, L.

Howell of Guildford, L.

Pilkington of Oxenford, L.

Kimball, L.

Platt of Writtle, B.

Kingsland, L.

Plummer of St. Marylebone, L.

Knight of Collingtree, B.

Reay, L.

Laird, L.

Rees, L.

Lindsay, E.

Renton, L.

Liverpool, E.

Roberts of Conwy, L.

Lofthouse of Pontefract, L.

Rogan, L.

Luke, L.

Rotherwick, L.

Lyell, L.

Saltoun of Abernethy, Ly.

McColl of Dulwich, L.

Sanderson of Bowden, L.

MacGregor of Pulham Market, L.

Seccombe, B.

Selborne, E.

Mackay of Clashfern, L.

Selsdon, L.

MacLaurin of Knebworth, L.

Shrewsbury, E.

Maginnis of Drumglass, L.

Simon of Glaisdale, L.

Marlesford, L. [Teller]

Skelmersdale, L.

Masham of Ilton, B.

Stewartby, L.

Mason of Barnsley, L.

Stoddart of Swindon, L.

Mayhew of Twysden, L.

Strange, B.

Miller of Hendon, B.

Strathclyde, L.

Molyneaux or Killead, L.

Taylor of Warwick, L.

Monson, L.

Tebbit, L.

Montrose, D.

Tombs, L.

Mowbray and Stourton, L.

Trefgarne, L.

Moynihan, L.

Trumpington, B.

Murton of Lindisfarne, L.

Vinson, L.

Naseby, L.

Waddington, L.

Northbrook, L.

Wade of Chorlton, L.

Northesk, E.

Wakeham, L.

Norton of Louth, L.

Weatherill, L.

O'Cathain, B. [Teller]

Willoughby de Broke, L.

Palmer, L.

Windlesham, L.

Wolfson, L.

NOT-CONTENTS

Acton, L.

Evans of Temple Guiting, L.

Addington, L.

Ezra, L.

Ahmed, L.

Farrington of Ribbleton, B.

Allenby of Megiddo, V.

Faulkner of Worcester, L.

Alli, L.

Filkin, L.

Amos, B. (Lord President)

Finlay of Llandaff, B.

Andrews, B.

Gavron, L.

Archer of Sandwell, L.

Goldsmith, L.

Barker, B.

Goodhart, L.

Barnett, L.

Gordon of Strathblane, L.

Bassam of Brighton, L.

Goudie, B.

Berkeley, L.

Gould of Potternewton, B.

Bernstein of Craigweil, L.

Graham of Edmonton, L.

Bhatia, L.

Grantchester, L.

Billingham, B.

Grocott, L. [Teller]

Borrie, L.

Hamwee, B.

Bragg, L.

Harris of Haringey, L.

Brooke of Alverthorpe, L.

Harris of Richmond, B.

Burlison, L.

Harrison, L.

Campbell-Savours, L.

Haskins, L.

Carter, L.

Hilton of Eggardon, B.

Chandos, V.

Hogg of Cumbernauld, L.

Christopher, L.

Hollis of Heigham, B.

Clark of Windermere, L.

Howarth of Breckland, B.

Clement-Jones, L.

Howe of Idlicote, B.

Clinton-Davis, L.

Howells of St. Davids, B.

Cohen of Pimlico, B.

Hoyle, L.

Corbett of Castle Vale, L.

Hughes of Woodside, L.

Craigavon, V.

Hunt of Chesterton, L.

Crawley, B.

Hunt of Kings Heath, L.

David, B.

Irvine of Lairg, L.

Davies of Oldham, L. [Teller]

Jay of Paddington, B.

Dean of Thornton-le-Fylde, B.

Jeger, B.

Desai, L.

Jones, L.

Dholakia, L.

Judd, L.

Dubs, L.

King of West Bromwich, L.

Elder, L.

Kirkhill, L.

1088

Layard, L.

Rodgers of Quarry Bank, L.

Lester of Herne Hill, L.

Rooker, L.

Lipsey, L.

Roper, L.

Livsey of Talgarth, L.

Russell-Johnston, L.

Lockwood, B.

Sainsbury of Turville, L.

Macdonald of Tradeston, L.

Sandberg, L.

McIntosh of Haringey, L.

Sawyer, L.

McIntosh of Hudnall, B.

Scotland of Asthal, B.

MacKenzie of Culkein, L.

Scott of Needham Market, B.

Mackie of Benshie, L.

sharp of Guildford, B.

Maclennan of Rogart, L.

Simon, V.

Maddock, B.

Smith of Clifton, L.

Mar and Kellie, E.

Smith of Leigh, L.

Miller of Chilthorne Domer, B.

Stone of Blackheath, L.

Mitchell, L.

Symons of Vernham Dean, B.

Morgan, L.

Temple-Morris, L.

Morriss of Aberavon, L.

Thomas of Gresford, L.

Murray of Epping Forest, L.

Thomas of Walliswood, B.

Newby, L.

Thornton, B.

Northover, B.

Tomlinson, L.

Oakeshott of Seagrove Bay, L.

Tope, L.

Ouseley, L.

Tordoff, L.

Parekh, L.

Turnberg, L.

Patel of Blackburn, L.

Turner of Camden, B.

Pendry, L.

Wallace of Saltaire, L.

Peston, L.

Walmsley, B.

Prys-Davies, L.

Walpole, L.

Puttnam, L.

Warner, L.

Radice, L.

Warwick of Undercliffe, B.

Ramsay of Cartvale, B.

Whitaker, B.

Randall of St. Budeaux, L.

Whitty, L.

Razzall, L.

Wilkins, B.

Redesdale, L.

Williams of Elvel, L.

Rendell of Babergh, B.

Williamson of Horton, L.

Rennard, L.

Winston, L.

Resolved in the negative, and amendment disagreed to accordingly.
6.19 p.m.
An amendment (privilege) made.
Lord Filkin: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord Filkin).
Lord Tebbit: My Lords, I shall be brief. First, I express my thanks, especially to the noble Lord, Lord Filkin, and his colleagues on the Front Bench. The Bill is highly contentious and quite emotive, and I greatly appreciated the courtesy and good humour with which it was debated in the Chamber; and, occasionally, the even greater humour with which it was debated just outside the door, I must confess.
I hope that the noble Lord will not think that I am misquoting him, for I cite from memory rather than Hansard, when I say that at the end of Second Reading, he declined to argue with me because he saw my objections to the Bill as being objections of principle and therefore incapable of being moved. That is rather a pity; we should sometimes try to change people's minds over objections in principle. In many ways, we should try harder at that. The noble Lord rarely dealt with the arguments for the numerous amendments that I moved. It was not a discourse of the deaf: we heard and understood each other; but, all too often, we did not really engage in debate about the issues.

1089
On secular grounds, I objected to a law that requires a public servant to certify as true that which is not true. That is not that a person may have changed sex. Whether that is possible is a matter of debate, but it is not open to debate that if a child is certified at birth as female and subsequently gives birth, the odds are heavily that she was born a girl. A subsequent sex change may or may not be real, but it cannot change the fact of her birth. The Bill purports that that fact can be changed and requires a public servant to certify that it has happened, when clearly it has not. The Bill is unchanged not only from Second Reading but from First Reading in that respect.
On grounds of common sense, I objected to the fact that the Bill would allow the marriage of two persons, each bearing the chromosomes, genitalia and gonads of the same sex, provided only that one of them believed—and persuaded a panel of experts to believe—that he or she had changed sex. My amendment on that matter was rejected.
On religious—or, perhaps I should say, Church— grounds, I found myself greatly in agreement with my noble friend Lady O'Cathain on a number of amendments that she moved, all of which were rejected. I find it disturbing that sport seems in Ministers' minds to need more protection than religion. It seems to me that it is bishops rather than footballers who are an endangered species these days.
Lastly, I say again how sorry I am that we have not heard the voice of Islam in our debates. I think that, with the sole exception of sport, the Bill is now as bad a Bill as it was when it was introduced to the House. I therefore object to it and will ask the House to reject it.
Lord Filkin: My Lords, I shall be very brief. At Second Reading, I did not say that I would not engage with the noble Lord, Lord Tebbit—I and others, especially my noble friends Lord Winston and Lord Turnberg, engaged with him brilliantly on the central issue of the difference between sex and gender. Essentially, I was saying that there is a limit to how much time I will spend—his time or that of the House. I was not optimistic that a man of his firmness of opinion was likely to be swayed by my puny argumentation. We have done justice to his issues, particularly at Report around that central issue.
The central thrust of the case of the noble Lord, Lord Tebbit, was that one's chromosomes are the beginning and the end of the story. The Bill does not seek to rewrite history. It does not seek to say that what was recorded at birth is not a historical fact. That is a historical fact; it is kept and it is recorded. The Bill recognises that in very limited circumstances, for a very limited number of people—after a proper process of testing, through medical opinion, advice and process test—it is right for the state to give recognition of a change of gender. The Bill does no more than that, but it is right that it does that.
We have spoken a number of times about sport. For the reasons that I gave not five minutes ago, we have been persuaded that there was a need to strengthen the protection on sport. That is all that we sought to do, and I am glad that we have done it.
1090
We have just had a debate on religion. There is no point in me repeating that debate at this point. I took some small comfort that, on an issue that was so central to the Church, of those Members sitting on the Bishops' Benches who were present in the Chamber, three of them voted with the Government on the amendment. The calumnies that have sometimes been put about that we have been riding roughshod over the sensitivities of organised religion are untrue.
I will say no more, because it is for the House to decide this issue, rather than my persuasion. 1 commend the Bill to the House.
6.27 p.m.
On Question, Whether the Bill do now pass?
Their Lordships divided: Contents, 155; Not-Contents, 57.

Division No. 5

CONTENTS

Acton, L.

Gavron, L.

Addington, L.

Goodhart, L.

Alli, L.

Gordon of Strathblane, L

Amos, B. (Lord President)

Goudie, B.

Andrews, B.

Gould of Potternewton, B.

Archer of Sandwell, L.

Graham of Edmonton, L.

Ashdown of Norton-sub-Hamdon, L.

Grantchester, L.

Greengross, B.

Bagri, L.

Grocott, L. [Teller]

Barker, B.

Hamwee, B.

Barnett, L.

Harris of Haringey, L.

Bassam of Brighton, L.

Harris of Richmond, B.

Berkeley, L.

Harrison, L.

Bernstein of Craigweil, L.

Haskins, L.

Bhatia, L.

Hilton of Eggardon, B.

Billingham, B.

Hogg of Cumbernauld, L.

Borrie, L.

Hollis of Heigham, B.

Bragg, L.

Howarth of Breckland, B.

Brooke of Alverthorpe, L.

Howe of ldlicote, B.

Brookman, L.

Howells of St. Davids, B.

Burlison, L.

Hoyle, L.

Buscombe, B.

Hughes of Woodside, L.

Campbell-Savours, L.

Hunt of Chesterton, L.

Carter, L.

Hunt of Kings Heath, L.

Chandos, V.

Irvine of Lairg, L.

Christopher, L.

Jay of Paddington, B.

Clark of Windermere, L.

Jeger, B.

Clement-Jones, L.

Jones, L.

Clinton-Davis, L.

Judd, L.

Cohen of Pimlico, B.

King of West Bromwich, L.

Corbett of Castle Vale, L.

Layard, L.

Craigavon, V.

Lea of Crondall, L.

Crawley, B.

Lester of Herne Hill, L.

David, B.

Lipsey, L.

Davies of Coity, L.

Livsey of Talgarth, L.

Davies of Oldham, L. [Teller]

Lockwood, B.

Dean of Thornton-le-Fylde, B.

Macdonald of Tradeston, L.

Desai, L.

McIntosh of Haringey, L.

Dholakia, L.

McIntosh of Hudnall, B.

Donoughue, L.

MacKenzie of Culkein, L.

Dubs, L.

Mackie of Benshie, L.

Elder, L.

Maclennan of Rogart, L.

Evans of Parkside, L.

McNally, L.

Evans of Temple Guiting, L.

Maddock, B.

Ezra, L.

Mar and Kellie, E.

Farrington of Ribbleton, B.

Mason of Barnsley, L.

Faulkner of Worcester, L.

Miller of Chilthorne Domer, B.

Filkin, L.

Mitchell, L.

Finlay of Llandaff, B.

Morgan, L.

1091

Morris of Aberavon, L.

Sawyer, L.

Murray of Epping Forest, L.

Scotland of Asthal, B.

Newby, L.

Scott of Needham Market, B.

Northover, B.

Sharp of Guildford, B.

Norton of Louth, L.

Shutt of Greetland, L.

Oakeshott of Seagrove Bay, L.

Simon, V.

Parekh, L.

Smith of Clifton, L.

Patel, L.

Smith of Leigh, L.

Patel of Blackburn, L.

Stone of Blackheath, L.

Pendry, L.

Symons of Vernham Dean, B.

Peston, L.

Temple-Morris, L.

Phillips of Sudbury, L.

Thomas of Gresford, L.

Pitkeathley, B.

Thomas of Walliswood, B.

Prys-Davies, L.

Thornton, B.

Puttnam, L.

Tomlinson, L.

Radice, L.

Tope, L.

Ramsay of Cartvale, B.

Tordoff, L.

Randall of St. Budeaux, L.

Turnberg, L.

Razzall, L.

Turner of Camden, B.

Redesdale, L.

Wallace of Saltaire, L.

Rendell of Babergh, B.

Walmsley, B.

Rennard, L.

Walpole, L.

Rodgers of Quarry Bank, L.

Warner, L.

Rooker, L.

Warwick of Undercliffe, B.

Roper, L.

Whitaker, B.

Russell-Johnston, L.

Whitty, L.

Sainsbury of Turville, L.

Wilkins, B.

St. John of Bletso, L.

Williamson of Horton, L.

Sandberg, L.

Winston, L.

NOT-CONTENTS

Armstrong of Ilminster, L.

Carnegy of Lour, B.

Attlee, E.

Chalfont, L.

Boyce, L.

Chan, L.

Burnham, L.

Colwyn, L.

1092

Cooke of Islandreagh, L.

Montrose, D.

Cox, B.

Naseby, L.

Dixon-Smith, L.

Northbrook, L.

Elton, L.

O'Cathain, B. [Teller]

Emerton, B.

Palmer, L.

Erroll, E.

Plummer of St. Marylebone, L.

Feldman, L.

Reay, L.

Gray of Contin, L.

Rees, L.

Harris of High Cross, L.

Renton, L.

Harris of Peckham, L.

Rotherwick, L.

Jauncey of Tullichettle, L.

Sanderson of Bowden, L.

Kimball, L.

Selsdon, L.

Kirkhill, L.

Shrewsbury, E.

Laird, L.

Stewartby, L.

Lindsay, E.

Stoddart of Swindon, L.

Liverpool, E.

Strange, B.

Lofthouse of Pontefract, L.

Tebbit, L. [Teller]

Luke, L.

Tombs, L.

Lyell, L.

Trefgarne, L.

MacLaurin of Knebworth, L.

Vinson, L.

Maginnis of Drumglass, L.

Waddington, L.

Marlesford, L.

Wade of Chorlton, L.

Masham of Ilton, B.

Weatherill, L.

Miller of Hendon, B.

Willoughby de Broke, L.

Molyneaux of Killead, L.

Resolved in the affirmative and Motion agreed to accordingly.
Bill passed, and sent to the Commons.
House adjourned at twenty-three minutes before seven o'clock.

Official Report of the Grand Committee on the

  Energy Bill [H.L.]
  (Seventh Day)
  Tuesday, 10 February 2004.
  The Committee met at half past three of the clock.
  [The Deputy Chairman of Committees (Lord Lyell) in the Chair.]
  The Deputy Chairman of Committees (Lord Lyell): I remind the Committee that if there is a Division in the Chamber we shall adjourn for 10 minutes. The usual rules for a Committee in the Chamber apply.
  Clause 90 [Other amendments consequential on Chapter 1 of Part 2]:
  Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer moved Amendment No. 109C:
  Page 73, line 37, at end insert—
  "( ) In section 8 of the Food and Environment Protection Act 1985 (c. 48) (licences), before subsection (1) insert—

  "(A1) The Secretary of State shall by regulations made by statutory instrument make provision about applications under this section which are also applications under section 36 or 37 of the Electricity Act 1989, and in particular about—

  (a) notices of application and supporting documentation required;

  (b) how applications are to be made and considered;

  (c) those competent authorities that should be consulted; and

  (d) how appeals are to be brought and considered;

  and any such regulations may make different provisions for different cases and circumstances.

  (B1) A statutory instrument containing regulations under subsection (A 1) above shall be subject to annulment in pursuance of a resolution of either House of Parliament.""

  The noble Baroness said: I start from where we left off on the previous day in Grand Committee. The Minister was giving me a helpful reply to Amendment No. 109C. For the record and so that the matter is more comprehensible, I shall speak briefly to it again.
  Amendment No. 109C would ensure that the rules are developed correctly for making and considering applications under the Food and Environment Protection Act 1985 that relate to offshore renewable energy installations. At the same time, I shall speak to Amendment No. 109D, which would give other competent authorities the opportunity to submit representations to a committee constituted under Schedule 3 of the Food and Environment Protection Act 1985.
  As the Energy Bill amends the Electricity Act 1989, it is not entirely clear exactly what status actions will have under the Food and Environment Protection Act and whether all the provisions that we are considering
  GC 484
  in this Bill will apply to the Food and Environment Protection Act. I believe that the Minister was saying that his department would consider regulations during this year. I look forward to hearing his explanation. I beg to move.
  Lord Williams of Elvel: I apologise to the Committee for intervening at a late stage in the Committee's deliberations, but I have a serious reservation about Section 36 and Schedule 8 of the Electricity Act 1989, which I shall explain.
  [The Sitting was suspended for a Division in the House from 3.33 p.m. to 3.43 p.m.]
  Lord Williams of Elvel: Before I was interrupted, I was about to say that the amendment moved by the noble Baroness rightly referred to Sections 36 and 37 of the Electricity Act 1989. I support what the noble Baroness said, but I would like to go a little further. That Bill was passed when I sat on the Opposition Front Benches. I opposed and still oppose this particular section.
  I shall be brief. Section 36, accompanied by Schedule 8, of the Electricity Act allows the Secretary of State to overrule almost every planning decision, when an installation with an installed capacity of 50 megawatts is presented to him or her. I do not need to go on about mid-Wales and wind farms, but we had a case where the local council, which is entitled under Schedule 8 to require a public inquiry, voted—for all sorts of reasons that I will not go into now, but which are quite obvious if one knows Ceredigion—not to demand a public inquiry on an enormous installation in the Cambrian hills. The Minister of Energy, as he was then, overrode any objections from the National Assembly for Wales, which has no powers to require a public inquiry, and simply passed the matter.
  If Clause 90 in the present Bill sets out to regulate the conditions under which offshore installations should be regulated, I do not see why—failing repeal, which I would like, of Section 36 of the Electricity Act and Schedule 8—that should not become part of this Bill for onshore installations as well as offshore installations.
  3.45 p.m.
  Lord Dixon-Smith: The noble Lord, Lord Williams of Elvel, has, in a sense, taken my subject. I also have a real concern about Sections 36 and 37 of the Electricity Act 1989, but for a slightly different reason. I came to it almost by accident because I happened to read the Planning and Compulsory Purchase Bill at precisely the same time. If one reads Clause 150 of the Bill that we are considering and—I believe—Clause 44 of the Planning and Compulsory Purchase Bill, which is being dealt with on the Floor of the House, one finds that the wording of the two clauses in the two Bills is almost identical. I thought, "Hang on a minute, what's going on here?". What is going on is that the electricity industry apparently has its own planning system.
  It seems to me that the real issue behind this is very serious, although I understand more or less how it came about. A lot of history is involved, and I wanted

  GC 485
  to deal with the matter and go into the background when we debated the Question whether Clause 150 shall stand part of the Bill. However, the real issue— the noble Lord, Lord Whitty, has been forewarned—is whether it is appropriate for a government department that is, in a sense, a promoting department for a planning application to be judge and jury in its own case. I have gone back as far as the Town and Country Planning Act 1962, and I have not got to the bottom of it yet. It appears that the system dates back to when there were public utilities, and it was deemed appropriate for the relevant Secretary of State to grant permission to his own department. So far as I can make out, that is more or less the background to the issue.
  For heaven's sake, we are now in the 21st century; we are not in the middle of the 20th century. In any other sector of life, this type of conflict of interest would require, at the least, a huge and very strong Chinese wall to be built—so huge and so strong that no one could get through it, under it or over it. Apparently, we do not have that, and there is still a duality of planning systems. I would rather deal with the matter when we debate the Question whether Clause 150 shall stand part of the Bill. However, it is relevant to this amendment, which touches on those clauses. I believe that a very serious—almost constitutional—dilemma lies behind the issue, and it is one that we need to consider.
  Apart from that, I believe that the noble Baroness is correct and she should be supported for the way in which she has raised the detail of the issue. However, somewhere and somehow, we need to get away from the system, if we can, and separate what I would call the generality of planning judgments in the planning system from the generality of the electricity industry, which is now privatised and should be in the same position as other industries.
  Lord Williams of Elvel: Would the noble Lord agree with separating planning decisions from the executive?
  Lord Dixon-Smith: Yes, precisely. I could not have put it better.
  Baroness Carnegy of Lour: My noble friend says that he would rather deal with the matter under Clause 150. He is talking about an extremely important issue, but that clause does not apply to Scotland.
  Lord Dixon-Smith: I might have known that the Scots would have an advantage somewhere.
  Baroness Miller of Chilthorne Domer: Before the Minister replies, perhaps I may intervene in the light of that very informative short debate. I am grateful to the noble Lord, Lord Williams of Elvel, for providing the background to the matter. He has been involved in this area far longer than I have.
  If the Minister is inclined to reply in the same vein as he did last week—that is, by saying that the issue will be dealt with by regulations somewhat later in the year—I sense that the Committee will be very
  GC 486
  unhappy, because we are raising fairly fundamental issues. Of course, I shall wait to hear the Minister's reply, but I sense that the Committee will be keen to see this measure in the Bill. Will the Government reconsider the process in the light of the comments about the DTI being judge and jury of the applications rather than simply expecting us to be happy with regulations? Noble Lords on these Benches and the noble Baroness, Lady Byford—we have encountered it with several Bills—are not happy with that way of dealing with matters.
  The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty): Somewhat wider issues have been raised in the debate, but the amendments as such would require the Secretary of State to make regulations to amend the Act; they do not spell out in any detail how those regulations should be drafted. As for whether they should apply onshore as well as offshore, Clause 80 is relevant only offshore and makes no changes to Schedule 8 that would affect any onshore applications.
  The issue that the noble Lord, Lord Dixon-Smith, raised—it was reflected in other comments— concerned the powers of the Secretary of State in relation to planning for electricity generating stations. Clearly, there has to be a different balance here than there is between the planning system and central government in relation to housing development or commercial development, as we have a national energy policy that has to observe all kinds of national criteria. We believe, broadly speaking, that the current balance is correct.
  I shall address the terms of the amendment, which is what I tried to do the other night. The department is already proposing to bring forward within a few months separate proposals to amend the Food and Environment Protection Act 1985. That Act indirectly incorporates parts of the Electricity Act that we are talking about. The proposed amendments to regulations will meet our obligations under the environmental impact assessment directive. Hitherto, we have not met those obligations through statute or secondary legislation; they have been met by a combination of administrative practice and reliance on similar regulations under other legislation. It is important that we tidy that up.
  The drafting of the regulations is well advanced. Not only do they make provision for changes that embrace those set out in the amendments—as distinct from what anyone has said in the debate—but they apply them to the generality of projects to which the directive applies, rather than restricting them to energy-related applications. The food and environment legislation has a wider remit than just electricity supply.
  The changes to Clause 90 proposed by the noble Baroness would duplicate in a piece of partial legislation dealing with energy something that we are addressing more comprehensively under the forthcoming proposed changes to FEPA.

  GC 487
  Amendment No. 109D would also introduce changes to FEPA. It would extend the current provision whereby an applicant can make representations about the decision taken by the licensing authority to refuse to grant a licence or about any terms and conditions which may be attached to a licence granted. The right to make such representations is restricted solely to the applicant. The amendment would extend the provisions such that when the licensing authority takes action to constitute a committee to consider representations from an applicant, it shall serve notice on all regulators and other specified public bodies exercising functions in the area and invite them to make similar representations to the committee. That would give a much wider range of potential engagement.
  Under the proposed regulations to which I referred in relation to the first of the amendments, consideration is already being given to how the representations procedure might be revised to make it more broad-based and inclusive. Therefore, we consider that that is the context in which any change in the pattern of representations should be addressed—in the regulations to FEPA, rather than in an amendment to a specific clause of this Bill.
  Baroness Byford: I wonder whether I could add my concerns. The noble Baroness was right in saying that she would have my support. The Minister said that the drafting was well advanced—if I have got his words exactly—and that it would generally apply to other remits as well, which I believe that we would accept. However, if it is generally well advanced, why can it not be put into the Bill now? It would not mean that it would not go in generality into the slot that the Government had in mind. What precludes the Government from introducing it into the Bill at this stage?
  In that way, I support the noble Baroness, Lady Miller of Chilthorne Domer, and hope that the Government will at least give a second thought to the matter. Unless the Minister's words were not quite correct, that is something that they have considered. I urge the noble Baroness to consider what the Minister has said and perhaps press the matter more forcefully at a later stage.
  Lord Williams of Elvel: I am grateful to the Minister for acknowledging that there is at least a problem. The problem that the noble Lord, Lord Dixon-Smith, and I set out is that one cannot have the executive being judge and jury. If the Government, who on most occasions I support, wish to devolve government to Wales and to local authorities, the planning process must take priority. All that the Government should then do is say that they have an agenda and that in the course of the planning applications that agenda will be considered—but it will not be considered at the expense of destroying half the landscape of mid-Wales, nor at the expense of destroying a number of birds in the Irish Sea.
  GC 488
  I ask my noble friend to consider my remarks, because if he does not I am afraid that at a later stage in the Bill we may have problems.
  Baroness Miller of Chilthorne Domer: I thank the noble Lords who have spoken. We were led to table the two amendments by the fact that we do not have a marine Act. The amendment is necessary because of the range of legislation applying to the marine environment. There are many Acts, as listed, that the Bill will have to take into account, but no spatial planning framework against which those Acts can be measured. Our lives in this Committee would be so much simpler if there were such a marine Act. In its absence, and without an amendment such as Amendment No. 109C, it is difficult to see how the applications will work—notwithstanding the Minister's comment that regulations will be introduced, which gives me fairly cold comfort, because we cannot see them before us now.
  The other debate that we considered is very interesting, and I look forward to returning to it. I shall withdraw the amendment now as is customary, but I shall discuss the matter with the other Members of the Committee who have spoken and expect to return to them on Report. In the mean time, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  4 p.m.
  [Amendment No. 109D not moved.]
  Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer moved Amendment No. 109E:
  Page 73, line 37, at end insert—
  "( ) In section 34 of the Coast Protection Act 1949 (c. 74) (restriction of works detrimental to navigation), after subsection (2) there is inserted—

  "(2A) The Secretary of State shall by regulations made by statutory instrument make provision about applications under this section which are also applications under section 36 (consent required for construction etc of generating stations) or 37 (consent required for overhead lines) of the Electricity Act 1989, and in particular about—

  (a) notices of application and supporting documentation required;

  (b) how applications are to be made and considered;

  (c) those competent authorities that should be consulted; and

  (d) how appeals are to be brought and considered;

  and any such regulations may make different provisions for different cases and circumstances.

  (2B) A statutory instrument containing regulations under subsection (2A) above shall be subject to annulment in pursuance of a resolution of either House of Parliament.""

  The noble Baroness said: Amendments Nos. 109E and 109F would amend Clause 90. Amendment No. 109E requires that the Secretary of State shall have regard to environmental matters under Section 34 of the Coast Protection Act 1949, yet another Act that pertains to the Bill. It will require that the Secretary of State has regard to environmental matters when considering applications made. Most, if not all, offshore renewable installations, both inside and

  GC 489
  outside the territorial waters, will require consent not only under Section 36 or 37 of the Electricity Act 1989, but under Section 34 of the Coast Protection Act. However, the Coast Protection Act may not pay—I believe it does not, unless the Minister tells me differently—sufficient regard to environmental issues. Where is it more important for applications to be subject to that kind of consideration than in our marine environment?
  Amendment No. 109F would require the development of rules determining how applications under the Coast Protection Act 1949 that relate to offshore renewable energy installations should be made and considered. It is surprising that we have a Bill before us allowing offshore installations, but no idea of how applications should be made and considered. Therefore, the amendment would bring in a clear definition of the types of matters that should be considered during the course of an application. I beg to move.
  Lord Dixon-Smith: On Wednesday of last week, we had an interesting discussion on the issue of bringing ashore energy and the point at which one had to consider whether, where and how the planning system becomes relevant. The amendment introduces another aspect of that problem.
  The electricity industry will always have the option of trying to bring ashore electricity if there is already a major power station on the coast. That will unquestionably simplify the situation, especially when one considers Sizewell or Dungeness. One can think of a number of places where it would be relatively straightforward to bring major power lines ashore. Of course, the planning regulations will still apply at the low-tide mark, as we learnt from the Minister last week, so one would have to go through the system. The issue of wider environmental problems certainly needs to be considered, particularly any question—it is difficult to believe that there would be any question— of possible interference with navigation rights and so on.
  That all illustrates how wonderfully complex is the system through which we are trying—constructively, I hope—to work our way. We all want the new system to work and to work well in everyone's interests. We have to fit it into an existing legislative framework that is immensely complex. We have to get the balance right. Although I would like to see far less legislation and regulation, if we do not get the matter right we shall be blamed by the public. We need to consider the noble Baroness's amendment with care.
  Lord Triesman: Perhaps I can pick up the point that the noble Lord, Lord Dixon-Smith, just made. Plainly, we are dealing with matters of some complexity. I suppose my instinct on such occasions is to see whether it is at all possible to inject a degree of simplicity—not simple-mindedness.
  [The Sitting was suspended for a Division in the House from 4.5 to 4.15 p.m.]
  Lord Triesman: I shall risk believing that my appeal for greater simplicity had been made before we adjourned for the Division. The point I wanted to make by way of introduction is that the more duplication we have between a number of interfacing Bills, the less likely it is to be intelligible to anybody. That is quite likely to be a problem that Members of the Committee share.
  None the less, I shall deal with the issues quite properly raised in the amendments. Amendment No. 109E would put certain set procedures into Section 34 of the Coast Protection Act, as the noble Baroness, Lady Miller of Chilthorne Domer, said. It has none of those provisions at present. Subsection (2A) seeks a statutory instrument to spell out how applicants should submit their applications and what documents they would have to provide, the process for considering the application and who will be statutorily consulted, and how appeals against refusal to consent or perhaps even against approval for consent can be made. Subsection (2B) proposes that a statutory instrument under subsection (2A) shall be subject to the negative resolution procedure in the House.
  From reading these amendments and the original clauses, I am fairly clear that there is no need to set out this procedure under the Coast Protection Act, as doing so would, in this case, serve only to duplicate the procedures that already exist in Schedule 8 of the Electricity Act 1989.
  Baroness Miller of Chilthorne Domer: I thank the Minister very much for giving way. Perhaps I could explain more clearly why I think that this is necessary so that if he thinks it relevant, he can include it in his reply.
  It is not simply that under the Coast Protection Act the Secretary of State does not have to take account of the environment. Section 34(3) of the Act defines when the Secretary of State may refuse an application— when it will cause or is likely to cause obstruction or danger to navigation. In other words, he cannot refuse it just because it will be damaging to the environment. That is probably the most important point. If it came to it, I wonder whether the licence applicant could challenge any decision of the Secretary of State to refuse an application on environmental grounds under the original Act, because it defines so exactly the only grounds he has for refusal.
  Lord Triesman: I intend to cover that ground in the course of my reply. If noble Lords feel I have not done so, no doubt they will raise the matter again.
  I was making the point that the procedures already in Schedule 8 of the Electricity Act 1989 need not be duplicated. They are a strong set of procedures which we are confident will do a great deal of the work that is suggested in the amendment, notwithstanding the desire I have just heard to repeal or at least to modify Schedule 8 of the Electricity Act. However, I speak on the basis that the schedule is in existence, that it has

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  provisions, and that those provisions need to be considered when we decide on the adequacy of the legislation we have. I wonder whether I could explain the argument a little more fully and respond to some of the points that have been made when I reach Amendment No. 109F.
  The proposed changes would add considerable confusion rather than greater simplicity to the Coast Protection Act consents process. It would result in two different routes for developments that required consent under the Electricity Act and those that did not. That would be difficult to administer in practice and would obscure the Secretary of State's clear role in considering Coast Protection Act applications. There would be plain confusion between the two routes.
  Amendment No. 109F seeks to impose a duty on the Secretary of State for Transport to have regard to the conservation of the marine environment when considering applications for consent under Section 34 of the Coast Protection Act 1949 that are also applications for consent under Sections 36 or 37 of the Electricity Act. I hope to reassure the Committee that the proposed amendment is not necessary. It adds no further provision to those already in existence under the requirements of the Electricity Act and would only duplicate the existing procedures.
  Developers of offshore renewable energy projects are required to apply for consent under Section 36 of the Electricity Act, as well as requiring consent under Section 34 of the Coast Protection Act. The purpose of the Coast Protection Act consent is to ensure that proper consideration is given to the potential impact on navigational safety. The Electricity Act consent is subject to a requirement that an application for development consent for an offshore renewable energy installation must be accompanied by a comprehensive environmental impact assessment, which is set out in the Electricity Works (Environmental Impact Assessment) (England and Wales) Regulations 2000. I repeat the point—I hope the Committee does not feel that I am labouring it—that there must be a comprehensive environmental impact assessment at that stage and under that procedure.
  Once a renewable energy zone has been designated, the regulations will be extended to apply to consents for development within it. The environmental impact assessment must consider the project in its entirety. It must do precisely that which we have been asked that it should do. The regulations make it clear that the environmental impact assessment must be comprehensive in its coverage and would routinely include all the aspects identified in subsections 3B(a), (b) and (c) of the proposed amendment.
  While the requirement of the environmental impact assessment arises from the Secretary of State for Trade and Industry's responsibility, consideration of the environmental statement is snared by all departments with an interest, including the Department of Transport, in relation to the impact on navigational safety, and Delhi, in relation to the impact on the marine environment. Statutory consultation procedures ensure that advice from all appropriate
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  bodies is taken into account in the Secretary of State's determination of an Electricity Act consent application. I do not think that the proposed amendment would add anything to the process, which we believe is fully comprehensive. The existing procedures provide for a certain degree of administrative streamlining in the consultation process, and, as I said at the beginning, they avoid duplication, which the amendment would create by having consultees asked the same question twice by two separate departments.
  I should stress that the most crucial point in the consent process is not who "owns" the consultation process, but that all the right people are consulted during the process and that their views are considered fully by the right people. That is exactly how the process works. Consultation responses are assessed by the department with appropriate policy responsibility, so that the Department of Transport considers the issues relating to navigational safety. Defra provides advice on the potential impact on the marine environment. The Secretary of State for Trade and Industry and the Secretary of State for Transport do not consider applications and the advice from consultees in isolation from one another, but together.
  All relevant factors are taken into account in reaching a decision. It would not, for example, be possible for a wind farm developer to have an Electricity Act consent and not a Coast Protection Act consent. If there were overriding reasons why one of the consents could not be granted, the development would not be able to proceed. On that basis, I hope that I can persuade noble Lords that the amendments are not necessary. This may be one of those occasions when avoiding further duplication will be of great merit to those who will have to find their way through the issue in reality and practice.
  Lord Dixon-Smith: On a technical point, the Section 36 route deals only with the need for permission to generate above a permitted capacity—that is, 50 megawatts. Let us suppose that some devious-minded person comes along with a series of 40-megawatt capacity generating fields and separates them suitably. Who will have to give permission for that, because it is outwith Section 36?
  Lord Triesman: I am happy to be able to answer that point instantly. The noble Lord, Lord Dixon-Smith, bowled me a googly there, but happily it was wide. Offshore wind farms are one megawatt by statutory instrument.
  Lord Dixon-Smith: I thank the noble Lord.
  Baroness Miller of Chilthorne Domer: I thank the Minister for what I considered to be an illuminating reply about how the Government see the Bill working. So far as obtaining a vague idea of how it might work, his reply provided far more illumination than did reading the Bill, even with the good Explanatory Notes.
  I can still see some difficulties arising from all the parallel processes that the Minister described. I can well understand his point that the processes should not

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  be duplicated, but each department will be working in parallel, and I have some difficulty seeing who will make the final judgment. I intend to read carefully what the Minister said and, if I return to the issue, it will be with the idea of making it clear how such a parallel process can come together. In the mean time, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 109F not moved.]
  Clause 90 agreed to.
  Clause 91 [Interpretation of Chapter 1 of Part 2]:
  [Amendment No. 109G not moved.]
  Clause 91 agreed to.
  4.30 p.m.
  Clause 92 [Requirement to prepare decommissioning programmes]:
  Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer moved Amendment No. 109H:
  Page 76, line 1, at beginning insert "Subject to subsections (3) to (11),"
  The noble Baroness said: This may appear to be a rather fearsome group of amendments. I have grouped them together because they all deal with particular aspects of the decommissioning programme. I thought that it might be for the convenience of the Committee if we discussed all aspects of the decommissioning programme, which takes us into Chapter 2 of the Energy Bill, at the same time. Therefore, I shall briefly run through the purpose of the amendments, and I hope that we shall then be able to debate the generality of the decommissioning programme.
  The amendments would give the Secretary of State a duty to serve a notice on offshore renewable energy installation applicants to produce a decommissioning programme, as specified in the notice. The requirement to produce a decommissioning programme applies only to installations in the marine environment. Of course, in Part 1 of the Bill we spent a long time discussing nuclear decommissioning. We can appreciate how important it is to think in detail about decommissioning before agreeing to something. Therefore, I feel strongly about this part of the Bill.
  The amendments would require applicants to consult relevant competent authorities and others where specified, such as English Nature, the Countryside Council for Wales and Scottish Natural Heritage, before submitting the programme to the Secretary of State for approval. In addition, applicants would need to include within their programme details of how it would be financed. Looking back to Part 1 of the Bill, I appreciate that decommissioning offshore wind installations is not likely to be as expensive as nuclear, but it is an important consideration.
  It is important that a duty on applicants to have a decommissioning programme exists, to avoid the possibility of redundant offshore installations or parts thereof being left in the marine environment when they have reached the end of their operating life. I believe
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  that the view of the DTI is that there is already a decommissioning programme for such installations which is working well—that may be the case—but that is not set down in statute. These amendments would put that on the face of the Bill and ensure that duties are applied consistently into the future—for example, for the life of the installations. The current lack of a provision in the Bill requiring decommissioning of installations is contrary to Article 60 of the UN Convention on the Law of the Sea, which I shall not read out as I am sure noble Lords are aware of it.
  To ensure that the requirement for a decommissioning scheme is not seen as a deterrent to those applying to develop offshore renewables, the Secretary of State would serve a notice only when consent had been given for a scheme to proceed or when it was clear that a scheme was very likely to proceed.
  I understand that the current wording in the Energy Bill which states that the Secretary of State "may"— rather than "shall"—issue a notice to require production of a decommissioning programme, is phrased to reflect that, in some cases, it might be the responsibility of the Welsh Assembly to issue such a notice. However, that is far from explicit in the Bill. I look forward to the Minister clarifying that particular point. Imposing a duty on the Secretary of State as envisaged in the amendment does not appear to cut across any responsibilities of the Welsh Assembly. Further clarification from the Minister would be helpful.
  Amendment No. 110B would allow the Secretary of State to choose whether to require the submission of a new decommissioning programme if he rejects an earlier such programme. One programme may be deemed not to be satisfactory, and he may need to require a new one. It would be a nonsense if he were to turn down an existing programme but have no powers to require the commission of a new programme.
  Amendment No. 110C would impose a duty on the Secretary of State to publish decommissioning programmes after approval. That is an important point—given transparency—so that everyone is clear what is happening. A number of people may be affected by decommissioning programmes. I believe it is extremely important that the Bill requires any approved programme to be made available for public inspection. If there have been substantial changes to the original submitted programme, any revised programme should equally be publicised and available for public inspection. I do not believe that the Bill as drafted covers that point.
  Amendment No. 110D would impose a duty on the Secretary of State to publish details of a decommissioning programme that he has developed. That is fairly self-explanatory. Amendment No. 110E would impose a duty on the Secretary of State to consult relevant bodies when developing his own decommissioning programme. At present Clause 93 of the Bill requires the Secretary of State to consult Scottish Ministers where an installation is within Scottish waters before making a decision concerning

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  the decommissioning programme. However, as far as I can see, there are no other requirements in the Bill concerning a wider consultation of relevant competent authorities—for example, English Nature, the Government's adviser on the marine environment, or the Countryside Council for Wales. I believe that these amendments will address that shortcoming.
  Finally, Amendments Nos. 110F and 110G would impose a duty on the Secretary of State to consult relevant interests concerning proposals to amend a decommissioning programme. That is a small point, but it could be substantially amended and would not be subject to consultation with the relevant bodies whose advice should reasonably be sought. I beg to move.
  Lord Dixon-Smith: I wonder whether I could invite the Minister, in replying to the amendments, to explain the background to this a little more. Early in my career in the House, we carried out an examination of the problems of decommissioning the oil rigs. It is a matter of fact and misfortune that at that time, the decommissioning of oil rigs and the undersea pipelines was not adequately taken into account at the time of their installation. It is good that decommissioning is being considered at the point of installation in the Bill, because it is very important.
  If I understand the construction of these wind turbines in the sea bed correctly, it seems that the bases are likely to have a much longer life than the pylons and generators on top. I may be incorrect about that, but I would be delighted if I were. I would be delighted to know that once a base was installed, it might see through three or four generations on the top before it had to be taken out of the sea bed. They are, fortunately, fairly simple structures; if they can be knocked into the sea bed, it would be nice to feel that they could be extracted. Can the Minister advise us whether that is so? I rather assume that it is, which will leave a clean sea bed. But if there is any question of their having to be cut off, leaving a residue, that could be most unfortunate. However, some might think that if the sea bed was left rough and fishermen could not get at it again, that would be a positive advantage.
  These are peripheral issues. The other factor I remember regarding the oil industry investigation was that originally the oil rigs were thought to have a particular life, as were the oil pipelines. There was particular concern that whatever happened to the oil rigs, the oil pipelines should be left in situ because developments in oil extraction techniques would mean that the pipelines could subsequently be used again if it were possible to extract more oil from the fields. Oil extraction is not a 100 per cent process—it has its built-in inefficiency, if I can put it like that. I do not know whether the same consideration would apply in this case. Clearly, we could continue building new wind farms on the sites of old wind farms for a very long time. It is probably not so much a question of decommissioning as of ensuring that the original specification and the quality of the installation is sufficiently robust to have a much longer life span than the presumed life span of the original installation.
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  These are significant considerations, and I would be most grateful if the Minister could give us the Government's thinking on the background.
  Lord Whitty: I am grateful to the noble Lord, Lord Dixon-Smith, for recognising the importance of this aspect of the framework for consents— decommissioning is an important dimension of it. Very important international obligations are involved as well—the United Nations Convention on the Law of the Sea requires that any installation which is abandoned or disused should be removed to ensure the safety of navigation. Such a removal is to have due regard to fishing as well as the protection of the marine environment. So there are a lot of complicated requirements under the convention which, admittedly, only applies in our case to installations in the renewable energy zone. Of course, we would want to ensure that all sites, wherever they were located, were subject to similar standards in relation to decommissioning.
  The UN Convention itself is not prescriptive about how a contracting state is obliged to carry out its obligations. We believe that the Bill gives us a scheme which is efficient, which provides the controls necessary to ensure that installations are decommissioned, and sets appropriate standards including environmental standards and protection for the various elements to which I have referred. It also builds in an appropriate level of consultation. I believe that the way in which we have approached the issue is sufficient. We do not want a process that is unnecessarily slow, cumbersome and inflexible. There are aspects of the noble Baroness's amendments that would have that effect or would lead us significantly in that direction.
  On the point made by the noble Lord, Lord Dixon-Smith, as to whether we are dealing with decommissioning of the installation at the top or underneath, and whether we could add more powerful machines at some later stage, we probably could do so in most circumstances. However, a new Section 36 consent would be required in those circumstances, so the issue of decommissioning or adding arises at all points when changing the nature of the installation.
  As for the process, which is what the amendments deal with, Amendment No. 109J would take away the discretionary nature of the power of the Secretary of State to issue a notice requiring a person to submit a decommissioning plan. Instead, the Secretary of State would be obliged so to do in all cases. The discretion provided by the Bill is not an attempt on our part to slide out from under our obligation under international law but to give the Secretary of State a degree of flexibility. We expect that all installations will be decommissioned using the statutory scheme. However, there may be rare circumstances when it may be more appropriate to use other routes to achieve the same end. For example, renewable energy installations that have already received development consent are subject to separate decommissioning requirements, and it is not our intention to undo those

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  arrangements. There may be other circumstances in future in which we would not want the power to be too rigid.
  The next group of amendments deals with the issue of consultation. We agree that consultation is important, but it is also important to ensure that the process does not become too bogged down. The Secretary of State will need to consult under the regulations made under Clause 98. Those regulations will set important standards, particularly in respect of environmental matters. The Secretary of State has a duty at Clause 98(5) to consult. She can also require the person who has the duty to submit a decommissioning programme to consult whoever she directs him to consult. Our intention is certainly that there should be such consultation, and our statutory advisers would be obvious candidates for inclusion in the list. However, we need a measure of flexibility, so that when it is not necessary to consult the developer is not forced to go through an unnecessary exercise.
  I note that the noble Baroness's amendment seeks to install its own flexibility by requiring consultation with the "competent authority" only,
  "so far as reasonably practicable".
  That seems to build in a possible loophole. The amendment would mean that the Secretary of State would have to designate those whom the developer should consult. I do not believe that it is necessary for the Secretary of State to consult when a programme is modified; the modification can in some circumstances be a very minor one. It is also important to bear in mind that the Secretary of State has a duty to review the decommissioning programme, under the terms of the clauses.
  Clause 95 also deals with situations in which a project is sold on and the provisions are designed to ensure there is a smooth transition. I am not sure what separate form of consultation is needed in these circumstances. I do not believe that it is necessary to impose an obligation on the Secretary of State to consult when she herself has prepared the programme, in accordance with the standards already laid down in the regulations, which include the consultation. Of course, there is nothing to stop the Secretary of State engaging in wider consultation but I do not believe that it would be necessary to do so for something on which there has been consultation in the course of drawing up the regulations.
  In relation to these clauses, the noble Baroness raised the issue of the Welsh Assembly. The Welsh Assembly is not given powers under this part of the Bill to issue a notice requiring the submission of a decommissioning programme. The Welsh Assembly already has devolved powers under the Transport and Works Act which can be used to give consent for offshore wind farms. Part of that consent could be to include decommissioning arrangements as a condition of such consent. That is a matter for the Welsh Assembly and its existing powers. We would not use this clause to override them.
  GC 498
  Amendment No. 110ZF places a specific obligation on the developer to provide certain information in support of his decommissioning programme, whereas the existing text states that the Secretary of State may require such information. Again, it is a discretionary power which may not be needed if that information is already held.
  Amendment No. 110B tries to complicate the position as regards the provision of new or revised decommissioning programmes. It overlooks the provisions that are already in Clause 94 where the Secretary of State decides to prepare her own decommissioning programme.
  On publication of programmes, Amendments Nos. 110C and 110D would require the Secretary of State to publish approved decommissioning programmes. I believe that that degree of requirement is unnecessary. Our intention is that the developers themselves should put approved decommissioning programmes on their websites for public inspection. I do not envisage a problem in that respect.
  Amendment No. 110ZE deals with environmental pollution and requires that there should be no environmental pollution when offshore installations are decommissioned. A more reasonable approach is to ensure that environmental pollution is reduced to the minimum. Clause 98(2) provides for regulations that will address the issue of environmental pollution relating to standards of decommissioning and safety. I believe that these amendments over-complicate the situation by removing discretion from the process. The process itself is fairly robust. I would advise the noble Baroness not to pursue the amendments.
  4.45 p.m.
  Baroness Miller of Chilthorne Domer: I assure the Minister that I have absolutely no wish to make the process slow, cumbersome or over-complicated. I shall read carefully what he has said about the details of my amendments concerning publishing information, consultation, and so on. Despite his explanation, the more difficult area for me to understand is why there should be such a degree of discretion about the very basic principle that the Secretary of State may require an applicant to submit a decommissioning programme. I do not feel that the Bill has the right emphasis. The word "may" is very wishy-washy. Given what the Minister has said about the need for discretion, I would have felt more comfortable with the words "shall" or "unless a set of circumstances". As it stands, the Bill comes down heavily on the side of discretion and very little on the side of obligation. I expect to return to this matter on Report. In the mean time, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 109J not moved.]
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 110:
  Page 76, line 3, at end insert—
  "( ) Before issuing any notice under this section or approving, with or without modifications or conditions, any decommissioning programme, the Secretary of State shall have

  GC 499
  regard to the existence and terms of any other decommissioning programme in respect of a relevant object, with a view to minimising additional costs or obligations of decommissioning."
  The noble Baroness said: With this amendment, we are talking about the requirement to prepare decommissioning programmes. Clause 92 gives the Secretary of State a discretionary power to impose an obligation on various persons to submit a costed decommissioning programme for renewable energy installations and their associated electric lines. The power is exercisable in territorial waters, the seabed of which is owned by the Crown Estate, and in the renewable energy zones to be created on the United Kingdom continental shelf.
  The decommissioning programme may require security arrangements, financial or otherwise, that the person subject to the decommissioning obligation must put in place to ensure that funds are available to carry out the decommissioning programme. A non-exhaustive list of things that will constitute security for that purpose is given at Clause 101(2). I shall give the Committee a couple of examples. The clause mentions,
  "a charge over a bank account or any other asset"
  or,
  "a performance bond or guarantee".
  The power can be exercised when the renewable energy installation or related electric line is at the proposal stage—provided that at least one of the relevant statutory consents has been granted or has been applied for and is likely to be granted—and, subsequently, when the installation or the line is actually being used. The drafting applies, therefore, to future installations and to those that have already begun under round one. However, round one installations are already subject to decommissioning programmes imposed either under leases granted by the Crown Estate or under consents granted under Section 36 of the Electricity Act 1989. The Department of Trade and Industry has apparently indicated at industry seminars that it would not apply Clause 92 to round one projects.
  The amendment would ensure that there should be an integrated approach to decommissioning obligations. It would also give greater assurance to proposers of installations in further rounds that future decommissioning obligations that may be imposed under, for example, leases of parts of the territorial waters will not be duplicated by the requirements of the clause. Failure to give that assurance may act as a disincentive to proposers to invest. In turn, that will hinder the Government's attempts to meet their renewable energy targets.
  As failure to comply with the requirements of a decommissioning programme will be a criminal offence, it is suggested that the amendment contributes to Better Regulation Task Force principles in ensuring the clarity that everyone wants about the scope of the prohibition. I beg to move.
  Lord Triesiman: I probably ought to start by declaring a past interest. I was a member of the Better Regulation Task Force for some time. One of the tasks that we set ourselves was to try to make sure that, in complex areas, everyone at least knew at the beginning
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  of any enterprise in which they were liable to make an investment what the full weight of the obligations on them might be. We cannot always avoid complex regulations, and decommissioning may be an area in which, as several noble Lords said, there will be complex requirements to be met. It is best that everybody knows what they are from the start.
  The Secretary of State will need to be mindful of the decommissioning standards which are generally applied in drawing up the regulations. Clause 98 sets out what they are. These are standards for installations decommissioned under this scheme. They are rigorous, for all the reasons of safety and the environment which have been explored in earlier debates in Committee. There is absolutely no doubt that costs will be an important factor in setting those standards. It is not because there is a desire to goldplate the standards simply for their own sake; it is because in due course under this legislation, should it be passed, the Committee and the Secretary of State will have to bear it in mind that the United Kingdom has international obligations with respect to decommissioning which are precise and onerous.
  The United Nations Convention on the Law of the Sea requires us to ensure that installations are removed so that they do not present a hazard to navigation, for example. Members of the Committee have asked whether that involves those parts of them that stick out of the water or the structures in which they are embedded in the sea bed. In all cases, where they are decommissioned, they must not be allowed to continue to present a hazard to navigation.
  We have to be certain that the decommissioning programmes that are approved by the Secretary of State meet all the objectives set out in international law. Other decommissioning programmes might not have the same objectives; they might have lesser objectives and therefore fall foul of that law.
  In direct response to the point of the noble Baroness, Lady Miller of Hendon, the Government will not use the Bill procedure to apply to projects which have an existing Section 36 consent under the round one arrangements. All these projects already have a decommissioning programme, so we do not feel that it is necessary to set this out in the legislation. It is already there and does not need to be reproduced here.
  I hope that this persuades Members of the Committee that the amendment is not necessary. I respectfully ask that it should be withdrawn. The critical point is that the international obligations obviously must be expressed in ways which mean that anybody responsible for decommissioning works to the same set of standards, and that those standards are thoroughly observed.
  Baroness Byford: I wonder if the Minister would clarify something for me. He said that there are existing restrictions. Are the new arrangements exactly the same for new-build or is there a difference? Are the regulations that apply now the ones that have been superimposed on to this Bill?
  Lord Triesman: If I am wrong about this, I shall ensure that I write to the noble Baroness, but my

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  understanding is that the projects that were approved under round one had thorough decommissioning schemes. They were not statutory schemes; in fact, because of the early nature of round one, they were probably more comprehensive, because people wanted to make sure that no mistakes were made. Here we are trying to set out what those schemes ought to be for the long term and the future. I have no doubt that a good deal will be learnt from round one in that process, but my advice is that the statutory scheme will be more comprehensive, based on learning from the round one schemes. I realise that I probably inverted that explanation in my earlier sentence—I hope that Members of the Committee will forgive me. The statutory scheme will be more comprehensive, based on the lessons that are learnt from round one, which were a very preliminary start to the process. I apologise for any confusion.
  Baroness Miller of Hendon: It is very interesting because this again deals with decommissioning programmes. I know that on debates on earlier amendments moved by the noble Baroness, Lady Miller of Chilthorne Domer, there was a suggestion that there were already enough Acts and that she did not want any duplication. Now the Minister is saying that the Government do not want to goldplate any other decommissioning programmes because under international provisions, the decommissioning programmes that have taken place may not meet the standards required to meet international obligations. That may very well be so; I would not argue with that issue. However, my amendment says,
  "the Secretary of State shall have regard to the existence and terms of any other decommissioning programme".
  If the terms of "any other decommissioning programme" did not go far enough, of course it would be necessary to have separate provisions to meet these obligations. However, if they did, I see no reason at all why anyone should have to go through this whole procedure again. Having said that, I shall obviously read very carefully what the Minister has said, but I believe, if I may say so, that he has not had regard to the fact that I did not table a prescriptive amendment. I sought to avoid a process which in some cases might not be necessary. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 110ZA to 110ZF not moved.]
  Clause 92 agreed to.
  Clause 93 [Approval of decommissioning programmes]:
  5 p.m.
  Baroness Byford Baroness Byford moved Amendment No. 110A:
  Page 77, line 37, leave out subsection (4).
  The noble Baroness said: This is a probing amendment designed to find out in general terms what is the meaning of the phrase "such security". On page 84 of the Bill "security" is defined in terms of kinds of money; for example, deposits, bonds and so on. What the Bill does not do is to provide any clue as to how much money is involved. Will it be X per cent of the value of the completed installation? Will it be a proportion of the estimated decommissioning cost and, if so, will that proportion be predefined in guidelines or statute?
  If the security takes the form of a money deposit, will it go straight to the Consolidated Fund? Under what conditions will a security be redeemed? Will the value of a security be the same for everyone in relation to a given decommissioning size, or will certain companies or organisations pay less than others? If that is to be the case, will the Minister indicate how any difference will be calculated? I beg to move.
  Lord Triesman: Amendment No. 110A, which would remove the Secretary of State's power to impose obligations on developers to provide the necessary security to cover the cost of decommissioning an offshore installation, could not work in practice.
  This power is an essential part of the decommissioning scheme. It is necessary to ensure that assets will be in place to meet the costs of decommissioning the installation at the end of its life. That means meeting the full costs—the costs that are actually required to meet the decommissioning of the installation. It is to little purpose to impose an obligation on someone to decommission an installation only to find when the time comes to implement the programme that no funds are available. We need to ensure from the beginning that the costs of decommissioning and the decommissioning programme are fully covered. So the security arrangements will be designed to achieve that objective, no more and no less, case by case. "Security" is a customary definition of securities and not just money; it can be a variety of things. As Members of the Committee look down the list in Clause 101 they will find that—for example—letters of comfort, if sent by credible people and thought to be creditable, will equally be securities in this case, as one would expect them to be in other business circumstances.
  The Government have an obligation under the UN International Convention of the Law of the Sea to ensure that the installations are decommissioned so that they do not present a hazard to navigation; and, of course, protection of the environment is also a powerful reason for requiring installations to be removed. Both reasons are very important. We are not—as I am sure no one is in this Grand Committee— half-hearted about the arrangements that must be put in place to meet the obligations.
  A further factor is that we must ensure that the costs do not fall on the taxpayer by the Government having to pick up the bill when the developer fails to meet his obligations. That would give rise without question, and quite understandably, to the most profound objections.

  GC 503
  Noble Lords will see from the types of security listed in Clause 101 that we envisage a range of instruments, which are dependent on circumstances—as I said earlier—case by case. A key factor here will be the financial standing of the person who has the obligation to decommission the installation. We are not trying to be prescriptive; indeed, the list, as the noble Baroness said, is not exhaustive. Each case will be looked at on its merits.
  I hope that persuades the noble Baroness that this amendment is not necessary and might in fact turn out to be—I use the word cautiously—short-sighted when considering all the different kinds of circumstances that would occur. Accordingly, I ask her to withdraw the amendment.
  Baroness Byford: I thank the Minister for his response to my probing amendment. It was certainly not intended to be short-sighted in any way, but we need to somehow get answers to questions that run through our minds when we are looking through the Bills. Certainly I had no doubt that the amendment would actually fully cover the costs that would be incurred; so that was not a problem.
  However, the Minister did not answer my questions. Does the security take the form of the money deposited? If it does, will that go into the consolidated fund? Where does it go? I have looked down the list quite carefully. There is a,
  "charge over a bank account".
  Is that money then left with the person involved? There is "a deposit of money", but it does not say to where it is going. Presumably,
  "a performance bond or guarantee",
  would go into the department concerned. I am not sure where,
  "a letter of credit; and … a letter of comfort",
  go. I was seeking to find the detail on what happens and where the money goes. It may be that the matter is already set down in other legislation and I can be pointed in that direction. I thank the Minister for his words, with which I have no quarrel. However, his response did not clarify where these various securities go. The noble Lord said that the issue is flexible and that it would be taken case by case, which I can understand. That makes good sense. But even on a case-by-case scenario is it a proportion of the total cost, or how are these things decided upon? Having read very carefully through the provision I am none the wiser. I assure the Minister that my intention is not to denude the strength of the need for this provision, but to seek clarification. I do not know whether he would like to respond before I decide what to do with the amendment.
  Lord Dixon-Smith: Perhaps I may intervene because the matter is very important. If the Government were—and I am sure they are not—to demand the deposit of moneys upfront at the start of the construction period to pay for the decommissioning, we would be dealing with a, frankly, preposterous and unbusinesslike situation. I am sure the Government do not have that in mind.
  GC 504
  I want an assurance from the Government that there is a recognition—and obviously such recognition must apply equally to the firm installing a wind farm—at a point presumably 25 or 30 years in the future, that there is an absolute liability that will have to be met.
  It seems that what is required is an annual charge against the revenue stream, building what I would call a decommissioning fund—I nearly said a "sinking" fund, but that might be an unfortunate phrase—over the time. What the Government really require is a legally binding document showing that this kind of an arrangement is in place.
  I infer that—although it is not easy to read this definitely into Clause 101, the interpretation clause— providing the Government have that sort of arrangement in mind, and assuming that one is dealing with reputable people, of course there should be no problem. But it seems that it would be very complicated if an invitation were being made to someone installing a wind farm to put the decommissioning money upfront on day one. That would be a preposterous situation. I am sure that it is the last thought in the Government's mind, but I would welcome an assurance that that is so.
  Lord Triesman: It would certainly not be the Government's intention to impose such financial strictures at the beginning of an enterprise to make it impossible to conduct the undertaking. Plainly, that would be to no purpose.
  In Clause 101(2)—the non-inclusive list—as a number of noble Lords have commented, there are a variety of different methods. Of course each one is capable of answering in a slightly different way the questions of the noble Baroness, Lady Byford. I do not think it is anyone's intention to rule out mechanisms such as charges against revenue streams being an appropriate way of achieving that over a period of time. I shall take further advice on that, and if I am wrong, I shall say so.
  Charges held against accounts, access to bonds or guarantees, letters of credit and letters of comfort can be lodged with the appropriate authority in government and held, as they would be in any business where those were the guarantees of performance or future financial undertaking. Moneys can—and most likely will—be held in trust-fund form for the period in which they are required.
  So in each instance, case by case and depending on the kind of security involved, there is an appropriate destination for each of the forms of security provided.
  Baroness Byford: I thank my noble friend Lord Dixon-Smith for his good contribution. On my notes, although not on the notes that I have, I had written "upfront" and "unspecified amounts". My noble friend was quite right to raise the issue about "upfront"; but the Minister says that that is not so. On the other hand, one has to bear in mind that the costs will still need to be covered should anything happen to go wrong. I am glad to have on the record that the moneys are not upfront.

  GC 505
  I am intrigued that the money might go into a trust fund. Why would it go into a trust fund? I am getting more and more intrigued by this humble amendment. Why would it not go into a consolidated fund? What is so special about a trust fund?
  Lord Triesman: I was trying to make the point, not that no money might be required upfront, but that the total and final bill that might be presented 25 or 30 years hence could scarcely be lodged at the beginning in all probability. The argument for placing the money in a trust fund would be that it would then be held absolutely and securely and for the purpose for which it was originally intended, and not used for any other aim. That should give everyone a degree of confidence about the intention rather than believing that it might disappear in some other way.
  As the Committee can see, the precise arrangements are not defined in the Bill. I imagine that there might be others. That arrangement is one which I am advised would give a good deal of confidence.
  5.15 p.m.
  Baroness Miller of Hendon: I accept totally what the Minister said—that everything will be dealt with on a case-by-case basis. The whole idea of the security is that it simply includes those aspects that have been mentioned; there may be many other ways that are not specified here. However, although there is nothing wrong with a trust fund, I find it rather strange that nothing has been put down with regard to the question of the deposit of money, which my noble friend asked about.
  Much earlier—so many Committee sittings ago that I cannot remember where it came—there was quite a discussion about whether money all had to go into a consolidated fund or whether for specific purposes it could go into a segregated fund. The Government resisted all those amendments, saying that it needed to go into a consolidated fund. Nothing has been said on that at all—apart from a line from a note that came from the officials, perhaps. The Minister suggests that the money is in a sense going into a segregated fund, because it is going into a trust fund for that purpose. I find it strange that that has just come to light, as that is different from anything that we have heard before on the subject.
  Baroness Byford: I shall not press the Minister any further, but perhaps he might write to me with a little more detail, as I do not want to delay the Committee any further. When he does that, perhaps he could answer my query on the range of money. He has said that the total cost will not be upfront but that a proportion of it may be. If that could be clarified before Report stage, I would be grateful. It may seem a small detail, but those who are going into the business need to know where they stand.
  I accept the comments of my noble friend Lady Miller of Hendon, because I remember the long discussions that she mentioned, when the Government said, "No, you can't do that". However, at this stage, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 110B and 110C not moved.]
  Clause 93 agreed to.
  Clause 94 [Failure to submit or rejection of decommissioning programmes]:
  [Amendments Nos. 110D and 110E not moved.]
  Clause 94 agreed to.
  Clause 95 [Reviews and revisions of decommissioning programmes]:
  [Amendments Nos. 110F and 110G not moved.]
  Clause 95 agreed to.
  Clause 96 agreed to.
  Clause 97 [Default in carrying out decommissioning programmes]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 111:
  Page 81, line 19, leave out "due" and insert "reasonable"
  The noble Baroness said: Clause 97 provides for a situation in which someone or, more likely, some company, involved in a decommissioning programme fails to carry out his or its responsibilities, particularly pursuant to the requirements of the Secretary of State. Under the provisions of the clause, this failure constitutes an offence punishable by law. Of course, we have no quarrel with that. Subsection (4) rightly provides a defence, which is described as the exercise of "due diligence". We also have no quarrel with the provision of such a defence but, in my view, the words "due diligence" are a misuse of the phrase.
  "Due diligence" is a term of art employed in the world of accountancy, and sometimes in legal affairs, in relation to the duty of the seller of shares in a company to make full disclosure of all relevant facts and is coupled with the responsibility of the buyer adequately to investigate the information provided. I have never seen that phrase used outside that particular context. We certainly do not want to use a phrase that may have a very narrow specialised meaning. I believe that the correct phrase is "reasonable diligence". For some reason, in the six years or so that I have proposed amendments from these Benches using the word "reasonable", there has been some sort of Pavlovian reaction against the word.
  The subsection proposed by the Government rightly negates the suggestion of an absolute offence under the clause. Clearly, the Government intend that any defence should be that the person concerned has acted reasonably. It puts the onus of proof on the defendant. The terms of the defence and the burden of what the defendant must prove must be clear and unequivocal—namely, that he has acted reasonably in the particular circumstances.
  With due respect to the draftsmen, I have no idea why they have chosen to use what I consider to be an inappropriate term of art from a different context, instead of using the plain, ordinary word understood by everyone—"reasonable". I do not know whether the Government are suggesting that there is a difference between "due diligence" and "reasonable diligence", but, if there is, I would be interested to hear

  GC 507
  the Minister's explanation, even though it may entail a different amendment to define the unusual use of the phrase in the circumstances. In the mean time, I beg to move.
  Baroness Byford: Amendment No. 111A is grouped with Amendment No. 111. The reason for the amendment is to try to get from the Government some idea of the length of delay that there might be before proceedings are taken against a person. As far as I can see in the Bill, it is open-ended; it could be six months, a year or two years. Over the years, it has been a matter of concern in the National Health Service, for example, that there is sometimes up to two or three years' delay in the investigation of doctors. That is unfair not just to the hospital concerned but to the individual involved, who is limbo for all that time. I chose three calendar months not for a specific reason but to ask the Government to state their intention in the matter.
  Baroness Miller of Mention: Before the Minister replies, I must apologise to my noble friend. I cannot pretend that it is because my glasses are not any good: they are brand new. I missed out the first two lines of the sentence in which I was going to say that I would speak to Amendment No. 111 and my noble friend would speak to the other amendment.
  Lord Whitty: We appreciate the double act anyway.
  I do not agree with the amendment moved by the noble Baroness, Lady Miller of Hendon. "Due diligence" is not simply an accountancy term; it appears in a significant number of legal and legislative contexts. It is v/ell understood and has an implication of proportionality, as well as reasonableness. By any definition, "reasonable diligence" is less strong than "due diligence". It is a serious matter for a person to fail to take remedial action in such circumstances, and the phrase "due diligence" is appropriate.
  Amendment No. 111A would require the Government to instigate court proceedings against an offender who failed to carry out remedial programmes within "three calendar months" of the period of the original requirement for remedial action having elapsed. I understand the noble Baroness's concern, but I think that three months is somewhat tight. In many circumstances, it will be a complicated matter. We want justice to be done and be seen to be done as swiftly as possible, but we need a bit of flexibility. Three months would be a little bit tight for anyone preparing a legal case, let alone the Government. That is not to say that I am tempting the noble Baroness to suggest an alternative. Three months would not be acceptable to the Government.
  Baroness Byford: I did not expect the Minister to agree, and the amendment has provoked the reaction that I thought it would. I mean that in a complimentary way.
  Nowhere in the Bill is there any guidance on how long a period would elapse. That may be deliberate or there may be bits of the Bill that I have missed, but I did not find any. That is why I tabled the amendment.
  GC 508
  The amendment was designed to say to the Government that the period must be three months; I wanted to find out whether there would be guidance on what will be considered a reasonable time to allow to elapse before such action is taken.
  Lord Tombs: In relation to Clause 111, perhaps I may ask the Minister whether he envisages due diligence being unreasonable.
  Lord Whitty: No. I said that due diligence carries the connotation of proportionality as well as reasonableness, and it is therefore stronger than "reasonable". It subsumes reasonableness With regard to the point raised by the noble Baroness, I should say that it is very rare in statute to lay down a timescale on proceedings. Therefore, I am not really encouraging her to go down that road.
  Baroness Miller of Hendon: I thank the noble Lord for bringing a little lightness to the subject of the amendment, which one could not pretend to be the heaviest one that we are moving. I shall read very carefully what he said. However, I have to tell him that, interestingly, it was two lawyers who told me that they felt that "due diligence" was improper in this context. Having said that, I shall obviously reconsider the matter carefully and go back to my legal representatives. But, at this stage, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No 111A not moved.]
  Clause 97 agreed to.
  Clause 98 agreed to.
  Clause 99 [Duty to inform Secretary of State]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 111B:
  Page 83, line 17, at end insert—

  "(7A) For the purpose of this section a person participates in activities if—

  (a) he co-ordinates, and directs, the activity; or

  (b) he makes a relevant object available for use.

  (7B) Where different people have different interests in anything which forms part of a relevant object, only the person in actual possession of the relevant object may be regarded for the purpose of subsection (7A) as making it available for use."

  The noble Baroness said: Amendment No. 111B would simply provide a more precise definition of the word "participate", which appears in Clause 99(2)(g) of the Bill. It reads:
  "For the purposes of this section a person becomes responsible for a relevant object if…(g) he begins to participate in any of the following activities".
  According to my trusty Oxford English Dictionary, "participate" means,
  "to share or take part in".
  In my opinion, that is a very loose definition for a word that could involve the person in question in the very serious consequences of Section 99. The consequences would require positive actions by anyone caught by the section, with possible criminal sanctions and penalties in default.

  GC 509
  In my view, and in the view of the same two different lawyers who advised me on this point, the wording is wide enough to catch, for example, bankers and funders. It is perhaps not too fanciful to suggest that it might catch wholly subordinate people—employees who take part in the activities in the sense that they work for the company involved.
  I draw your Lordships' attention and, in particular, that of the Minister to the Energy (Northern Ireland) Order 2003. I quote from Articles 8(4) and (5) of the order. Article 8(4) states that,
  "a person participates in the transmission of electricity if

  (a) he co-ordinates and directs the flow of, electricity on to and over a transmission system by means of which the transmission of electricity takes place; or

  (b) he makes available for use for the purpose of such a transmission system anything which forms part of it".

  Article 8(5) of the order states:
  "Where different people have different interests in anything which forms part of a transmission system, only the person in actual possession of the thing may be regarded for the purpose of paragraph (4) as making it available for use".
  Your Lordships will have noticed that my first proposed new subsection paraphrases the Northern Ireland order. It simply adapts it to correspond with the main text of the clause. The second new subsection follows the order word for word. The Northern Ireland order is carefully worded so as to avoid catching what I might call "innocent bystanders". I have absolutely no doubt that the Government have no intention of doing anything such as that in the present Bill. This is not a question of my pedantically preferring my wording to that of the Government. Sometimes I do, but that is not the reason in this case. It is a matter of my preferring the better wording of one parliamentary draftsman over that of another. I mean no disrespect whatever to the very nice ladies and gentlemen sitting behind the Ministers. I hope that, in the interests of consistency, the Government will accept the amendment. I beg to move.
  5.30 p.m.
  Lord Triesman: The noble Baroness, Lady Miller of Hendon, is absolutely right that there is no intention of catching innocent bystanders. I hope that in general it is not intended to catch bankers, either, who may or may not be innocent bystanders.
  All the examples in Clause 99(2) show that the person responsible will have a serious executive role in respect of the activities. I do not think that any of those descriptions could really apply to someone in a subordinate role. In most cases, it seems clear to me that they apply to someone whose role is one of responsibility in relation to the activities.
  I can understand that there may be a preference for the drafting technique of different pieces of legislation, but I hope that I can persuade the noble Baroness that the drafting here is reasonable in the circumstances to meet the objectives and that it is fit for purpose.
  It is vital that the scheme we have included in the Bill for the decommissioning of renewable energy installations and electric lines works properly.
  GC 510
  Members of the Committee will recall that last week we discussed the important issues of protecting the environment and making sure that renewable energy installations are not a hazard to navigation. We must make sure that installations which have come to the end of their productive life are not left to corrode, causing a potential threat to passing ships by falling over and possibly polluting the sea.
  A key feature of the decommissioning scheme in the Bill is the ability of the Secretary of State to identify correctly the person or persons who should be given a duty to prepare a decommissioning programme under Clause 92. The issue of a notice by the Secretary of State requiring the submission of a decommissioning programme triggers the whole decommissioning programme—that is the point from which it starts. The duty placed on persons who become responsible for the renewable energy installation to inform the Secretary of State is necessary so that she always, at any moment, has the information that is necessary for her to decide who should receive the notice. For those reasons, she must obviously be in a position to know to whom to send the initial notice and subsequent notices over the life of the project.
  Given that these projects can have a very long life and that it may be 25 years or possibly more before the actual decommissioning takes place, it is very important to know at every stage who is responsible for each of the things listed in Clause 99. The project may be sold on; there may be changes in the ownership arrangements and assets over the time. The Secretary of State must be kept informed of all such changes so that she can decide whether she needs to issue a new notice requiring a decommissioning scheme and programme to be submitted. Otherwise, there is really no control over the process and the Secretary of State would have lost that control. This is the purpose of Clause 99(2), particularly paragraphs (f) and (g).
  The Deputy Chairman of Committees (Baroness Cox): A Division has been called. The Committee stands adjourned until 5.45 p.m.
  [The Sitting was suspended for a Division in the House from 5.35 p.m. to 5.45 p.m.]
  Lord Triesman: I resume my speech. This is almost beginning to take on the character of a soap opera. I feel that there should be dramatic music when I get to the really exciting bits and we shall resume the story later.
  I repeat that it is critical that the Secretary of State knows who is responsible and whether any changes have taken place in the enterprise. That was the burden of the point that I made before the Division was called. Furthermore, the Secretary of State will want to review whether the arrangements for providing security to ensure that the decommissioning programme is carried out continue to be adequate across the entire lifetime of the project. Information about the ownership of the assets to be decommissioned is of key importance.
  Clause 99(2)(f) seeks to identify the persons who are directly responsible for the construction, extension, operation, use or decommissioning of the installation.

  GC 511
  Clause 99(2)(g) is drawn a bit wider by referring to persons who begin to participate in these activities. What we have in mind here is situations, for example, where there is a special company which is set up solely to build or operate the installation with few assets other than the installation itself. That company will in turn be owned by one or more other companies. The Secretary of State needs to know who these companies are and keep track of all the ownership arrangements.
  That is just one example and there may be many other kinds of ownership arrangements over the lifetime of a project of this kind. New kinds of ownership models may develop over time. It is very difficult for us to be more specific on the face of the Bill as it would be impossible to capture all the possibilities although experience shows that new things emerge. If we failed to cover all of them there is a risk that there would be a loophole in the scheme which someone who is determined to evade their decommissioning responsibilities could exploit. In these circumstances the tax payer might have to pick up the decommissioning bill.
  We have made it clear at Clause 99(8) that, "participation in activities" does not include participation on behalf of another person or participation by acting in pursuance of an agreement to provide services to a person carrying on those activities. As I said at the beginning of my reply, if they are responsible for a matter that is covered by the legislation, a banker or an employee might be caught. However, under Clause 99(8)(b) bankers would not be caught if they were acting in pursuance of an agreement to provide banking services. They will plainly not be the hapless victims that it was feared might be the case. Employees acting on behalf of the employer are also excluded by Clause 99(8)(a) so they could not become hapless victims in the sense that we were discussing earlier.
  The amendment would restrict very considerably the categories of persons falling under Clause 99(2)(g) to those who,
  "co-ordinates, and directs, the activity; or … makes a relevant object available for use".
  In fact, we take the view that those persons will be more likely to fall under Clause 99(2)(f), which is why we cannot accept the amendment. We need to make the scheme watertight so that we can all rest assured that decommissioning will take place in a proper way. That is in all our interests.
  As with other aspects of the Bill, the decommissioning clauses provide only the bare legislative framework. It will be necessary to provide guidance notes on how the whole scheme will work in practice, and we shall certainly provide guidance on what we mean by "begins to participate" in certain activities, so that there can be no ambiguity about that. In that light, I ask the noble Baroness to withdraw the amendment.
  Baroness Miller of Hendon: The Minister had a good shot at that explanation, given that it was interrupted by the Division. That is a matter for the Government, who like having Grand Committees at the same time
  GC 512
  as the passage of Bills in the Chamber, so such interruptions will happen more and more often. I cannot help saying that; when the Minister knows me better, he might know that I very often say things like that.
  When I was interrupted, I forgot the flow of what I wanted to say, but when I was listening carefully to the Minister I realised why I did not accept his explanation, able as it was. We totally accept that, the Secretary of State must have notice of all the things mentioned in the clause; there is no question about that. She has her job to do, and she certainly has to do it. However, subsection (1) says:
  "A person who becomes responsible for a relevant object must notify the Secretary of State that he has become so responsible".
  Therefore, the word "responsible" is important. Then there are several explanations of what it might be that the person is responsible for.
  The Minister quoted paragraph (f), which is not part of the amendment but says,
  "he begins in such waters to construct, to extend, to operate or use or to decommission the object".
  I would have no objections to any of that, because clearly he does those things and that is the end of the matter. However, paragraph (g) goes on to say,
  "he begins to participate in any of the following activities".
  The activities are quite important, consisting of,
  "the construction, extension, operation or use or decommissioning of the object"
  I come back to where I started, which is the normal use of the word participate, meaning, "to share or to take part in". That is all; it does not mean to be in control of, whereas the amendment that we have tabled, copying the Northern Ireland order, makes it clear that a person participating in the transmission, for example, co-ordinates and directs the flow of it and gets involved in it. That is far more important than someone who is simply sharing in an activity.
  I have heard the Minister's comments, and I shall read them carefully, but at this stage I do not really and truthfully accept his argument. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 99 agreed to.
  Clauses 100 to 103 agreed to.
  Clause 104 [GEMA's power to act on behalf of Northern Ireland regulator]:
  6 p.m.
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 112:
  Page 86, line 11, at end insert—

  "( ) In section 32C of the 1989 Act (payment as an alternative to comply with order under section 32), for subsection (3) substitute—

  "( ) The Authority must pay the amounts received to electricity suppliers on a unified United Kingdom basis in accordance with a system of allocation specified in the relevant orders.""

  The noble Baroness said: In the absence of my noble friend Lord Jenkin of Roding, I shall speak to this group of amendments.

  GC 513
  With regard to Amendment No. 112, at present there are two separate buy-out funds under the renewables obligation—one for England and Wales and one for Scotland. Suppliers, when complying with their renewables obligations, can choose to redeem ROCs in different proportions between England and Wales and Scotland. Therefore, Scottish ROCs can have a different value from England and Wales ROCs. This is not helpful. By the way, I hate using acronyms, but I think everyone knows that ROC stands for the renewables obligation certificate.
  When an obligation is introduced in Northern Ireland, there will be three separate buy-out funds and therefore even more scope for unhelpful variance of ROC values. Each of the three relevant Governments would have to amend their existing renewables obligation orders to address this issue. It would be preferable if the Energy Bill were to create a single Great Britain fund and ultimately, when Northern Ireland introduces a renewables obligation, a single United Kingdom fund.
  The Energy Bill's regulatory impact assessment already states that the intended effect of the Bill is to create a single obligation system throughout the United Kingdom. Paragraph 3.28 makes that quite clear. The ideal solution would be a single UK obligation, as this would reduce both the current administrative burden and market distortions. However, this may not be possible, perhaps for political reasons. The Department for Enterprise, Trade and Investment in Northern Ireland has already exercised its autonomy in choosing to sell the Northern Ireland obligation at 6.3 per cent by 2010, rather than the 10.4 per cent target employed by Great Britain. This differential will further exaggerate the distortions in the value of individual buy-out funds.
  This amendment, which requires that the buy-out funds from all three obligations are pooled prior to recycle, thereby addresses the disparities in the recycle value of ROCs. This should help improve the functioning of the ROC market. This process would be undertaken by Ofgem, or possibly an independent market operator, as the administrator of all three funds.
  I mentioned earlier that I was having a bit of difficulty with my eyes. I clearly am, because I did not say when I started my remarks on Amendment No. 112 that I wanted to speak also to Amendments Nos. 122, 123 and 144. The subject is the securitisation of the renewables obligation funds. I apologise for not saying that at the beginning.
  With the leave of the Committee, I would like now to speak to Amendment No. 144, although that is slightly out of order in the group. If a supplier defaults and is unable to fulfil his obligation, a shortfall in the buy-out fund arises. Compliant suppliers receive less from the recycling of the buy-out fund than they would otherwise have anticipated—indeed, less than they may very well have relied upon receiving, thus putting themselves in some financial difficulty or, at the least, financial inconvenience.
  GC 514
  The effect of TXU and Maverick Energy's combined non-payment of £23.6 million to the buy-out fund has been a reduction in the level of recycled payments of around £4 per renewables obligation certificate. This is the type of material problem that the amendments seek to address.
  This loss falls entirely on the compliant suppliers who are supporting the renewables obligation. Those who bought out their obligation by paying the buy-out are not affected. The risk of default by those due to pay discourages suppliers from purchasing ROCs. This, in turn, undermines the whole principle of the renewables obligation scheme. If suppliers favour buying out of their obligation over submitting ROCs as a compliance strategy, demand for the ROCs will be weak. The short-term impact on price and demand will have a long-term impact on the rate of new renewable development, something in which everyone is interested. As a result, consumers will end up paying the same amount for the renewable obligation but for a smaller amount of renewables generation. That is the problem. It could—perhaps "will" is a more accurate word—undermine the economic efficiency of the obligation. The solution proposed in Amendment No. 144 is to give the authority power to take security in various forms. That, as I mentioned previously, could perhaps be given the shorthand description of "securitisation".
  However, it is right for me to point out that at least one other alternative suggestion has been floated by interested parties. This could loosely be called "mutualisation". It is a kind of group insurance, perhaps along the lines of the International Air Transport Association or British travel agents protecting their customers from a bankruptcy by a travel agent. Presumably it would be funded by a levy on suppliers. So far as I can tell from my post bag— I have received many different briefings and views on this—it is the solution preferred, in particular, by many smaller generators. However, those who object to that method point out that it entails the good paying for the defaults of the bad, that it is wrong to expect compliant companies to pay for the default of others, and that paying into what would amount to a mutual insurance fund will inevitably result in an increased expense ultimately to the consumer.
  The amendment that I have proposed, which is far more on the securitisation line, is the solution to the problem suggested by the Renewable Power Association. It has told me that it believes the Government are not adverse to that way forward. However, I thought it right to put everything on the table. The association and I both concede that it is but one solution to the problem of default. If the Government have a different, viable and effective solution, we shall be glad to hear from the Minister what it is, preferably at this stage if possible. Doing nothing about this is not an option.
  Amendment No. 122 in this group is a consequential amendment to Section 32C of the 1989 Act necessitated by the previous amendment. The value of a renewables obligation certificate to a supplier when presented to the authority in satisfaction of its

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  renewables obligation comprises two elements: first, the buy-out payment that it would have to pay but for the presentation of the ROC; and, secondly, a share of the moneys paid by suppliers not presenting ROCs— that is, the buy-out fund—which are recycled to those who do present.
  Thus, if a supplier defaults in making its buy-out payment, other suppliers who present ROCs to discharge their renewables obligation can suffer a loss. The intention of Amendment No. 122 is to enable provisions to be put in place to protect the value of ROCs from the failure of a supplier to make a buy-out payment. The proposed amendment contemplates at least two possibilities, which will need to be studied in much greater detail in due course since neither is without cost.
  The first approach contemplates that suppliers could be required to provide security to ensure that all or part of their obligation is met. The second, alternative, approach envisages that in, it is hoped, the rare event of supplier default, the remaining suppliers would pay additional amounts as necessary to ensure that, over an appropriate period, the value of the buy-out fund remained whole. So there one has it: securitisation on the one hand or, on the other, mutualisation as an alternative.
  If suppliers were required to provide security, the value of the ROC would be more secure. However, the measure should not distort competition. That may be the case if certain suppliers are able to present security in the form of a credit rating while others must provide a cash deposit. The costs of this additional layer of insurance, which ultimately would fall to customers, whether or not an event of default occurs, is also a legitimate area of concern. The payment of additional amounts by all suppliers in the event of default is likely to be achievable only if spread over an appropriate period. Unlike the case where security is demanded from suppliers, the cost to customers in this approach is incurred only when an event of default actually occurs. Although neither method provides a perfect security, enabling them at this stage leaves open the option, together with other options, of making the value of renewables obligation certificates more secure.
  I now come to Amendment No. 123. The renewables obligation is a tradable market mechanism to increase the amount of electricity generation coming from renewable energy sources. If it is to work properly, an effective market for renewable obligation certificates (ROCs) is essential.
  Ofgem administers the renewables obligations and operates the market for ROCs. How it does so is laid out in the renewables order. The fact that the details of the operation of the market are set out in legislation limits Ofgem's flexibility to manage the obligation efficiently. There are many aspects of the ROC market that can be optimised. As it is a relatively new concept, there are, no doubt, many wrinkles that need to be ironed out. At present, any changes have to be made through secondary legislation with mandatory prior consultation. To date, the DTI has run two
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  consultations relating to provisions of the renewables obligation; and it will shortly have to conduct a fu rther one to implement the recently announced increase in the quota to 15.4 percent by 2015.
  In my submission, the present procedures are far too inflexible to enable a speedy improvement to detailed administrative procedures involved in running the ROC market. Indeed, Ofgem has more than enough to do to administer the market alongside its other heavy legislative duties.
  It is possible that it might be better to delegate the operation of the ROC market to what the amendment calls, "suitably qualified persons" or to an organisation. Ideally, that would be a body which included representatives of the industry. Such revocable delegation would not affect the legislative basis for the obligation, the eligibility of the technologies or the price of the buy-out. At present, the obligation does not cater for the situation where a supply company defaults.
  My Amendment No. 144, to which I spoke first, is intended to deal with that in part. However, it is quite likely that other things will need to be clone to minimise the risks of supplier defaull, thus undermining the obligation, as I have already said. The fact is that the size of the obligation and the sums of money may grow in time. It might be thought advisable to shorten the compliance period as one way of reducing the risk and removing the temptation for a cash-strapped supplier from using the money for some other purpose. We are all familiar with the small employers who use the PAYE that they collect to pay their trade creditors' more urgently and more vigorously demanded debts. The essential thing is that the RO and the ROC system should be governed efficiently and effectively.
  Amendment No. 123 is not entirely prescriptive. While it stresses that the authority is to perform its obligations efficiently—which noble Lords might say goes without saying—it adds the alternative of delegation. It does so only as a discretionary option and does not seek to interfere with Ofgem's primary management obligation.
  I have taken rather a long time to describe that whole group of amendments because it is a complicated matter and I thought it was not right just to talk about "securitisation" without letting the Committee know that there are others who think there is an alternative. In responding, I very much hope that the Government will be able to tell us what it is. I beg to move.
  Lord Ezra: I support what the noble Baroness, Lady Miller of Hendon, has said about Amendment No. 144, which deals with supplier defaults in connection with the renewables obligation scheme. This issue was highlighted, as everyone will know, by the TXU and Maverick cases. There could be further cases in the future. In a scheme of this sort, one has to learn from experience. Here is an opportunity to legislate and to put in place a way to provide further securities than

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  presently exist it there are detaults in the future, as I am sure there almost certainly will be. I therefore support that amendment.
  Lord Davies of Oldham: I am grateful to the noble Baroness, Lady Miller, for the constructive way in which she moved the amendment. She put forward several proposals which, as we all recognise, relate to a current difficult situation.
  [The Sitting was suspended for a Division in the House from 6.10 to 6.22 p.m.]
  Lord Davies of Oldham: Lest anyone should think that the Division was engineered by me to collect my thoughts and that I have that kind of influence in the Chamber, I should say that it has made my situation chaotic as I have forgotten one or two of the key questions that the noble Baroness asked. However, she will prompt me as we go along and I shall do my very best to respond to the debate.
  I was saying how much I appreciated the constructive way in which she had approached what we all recognise is a difficult issue. I want to assure her that we have considered some of the constructive proposals and that we shall continue to do so. I hope that the noble Baroness will forgive me for replying to the amendments in numerical order rather than the order in which they were spoken to.
  At present, there are buy-out funds for England and Wales on the one hand and Scotland on the other. It is suggested that a system of separate funds offers the potential for abuse—in particular, that opportunities would be gained for certain suppliers—and that that would be prevented by creating the single Great Britain-wide buy-out fund which the noble Baroness advocated. We have no evidence that any abuse in that respect has occurred thus far. The Government are certainly willing to consider such a move. We consulted on that when we held our technical review of the renewables obligation order last year. However, we do not yet have sufficient information on which to base a decision on whether to merge the separate funds.
  I listened carefully to what the noble Baroness said and I understand the points that she made regarding merging the funds. We do not have a closed mind on the issue; in fact, we have a very open mind on whether that is a desirable way forward. However, it is too early and we do not have the requisite information that convinces us that this is the way forward. After all, the obligation has been in force for less than two years and we need more time to see how it is working. It would be premature to reach a final policy decision at this stage. We are certain that taking a decision now under the Bill would be the equivalent of setting a policy in concrete when we are by no means convinced that that is the certain route down which we should go.
  Although we have not used them so far, we already have powers to operate the two existing funds as though they were one. We also intend that Clause 103 will allow the principle of operating the separate funds as if they were one to be extended to the fund that we expect to be established under Northern Ireland
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  legislation. In future, it should be possible for the three potential funds to operate as though they were one, if decisions to that effect are taken. I recognise the force of the noble Baroness's advocacy, but, with the Bill, we have in place a framework within which that decision can be taken, if it proves to be the advisable choice to make.
  We are also enacting legislation under the Bill to allow mutual recognition of Northern Ireland renewables obligation certificates and Great Britain renewables obligation certificates. That paves the way for a Northern Ireland obligation to be put in place at a later date, modelled on the Renewables Obligation Order 2002 for England and Wales and the Renewables Obligation (Scotland) Order 2002. We plan to table government amendments on Report that will comprise additional clauses to complete the mutual recognition of the two sets of renewables certificates. The intended result is that although ROCs will be issued separately in Great Britain and Northern Ireland and although suppliers will be obligated under three separate orders—for Scotland, England and Wales and Northern Ireland, depending on where they supply electricity—any supplier will be able to buy and use any ROC under any of the obligations.
  The Government and the devolved administrations are taking a consistent approach to renewables development in the UK and the achievement of the renewables targets set in the energy White Paper. I hope that my comments on the proposed amendments give confidence that we will revisit the issue of a UK-wide buy-out fund when, as I have already explained, we are better placed to make a decision.
  That almost concludes my remarks on Amendment No. 112. I shall have to come back to the Committee on the others.
  [The Sitting was suspended for a Division in the House from 6.27 to 6.37 p.m.]
  Lord Davies of Oldham: I had just completed the remarks I wanted to address to Amendment No. 112 and I had indicated that in certain crucial areas the Government had an open mind on certain propositions in the amendment.
  On Amendments Nos. 122, 123 and 144, while the Government supports the aim of safeguarding the renewables fund against default, there are a number of problems that need to be overcome before we can accept amendments to the Bill to address the issue. I recognise the concern expressed by the noble Baroness, Lady Miller, in moving the amendment on the current issue. Companies can and do fail and as the renewables obligation is a market-driven mechanism, there is a limit to the extent to which the Government should intervene. When the problem of the shortfall occurred in the autumn, the Government made it clear that they had no plans to make good the shortfall as that would undermine the concept of a free market in renewables obligation certificates. I note that, although the amendments are constructive—they were moved in a constructive manner—none of them addresses the current shortfall, which is the cause of considerable concern and anxiety.

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  We are working with the industry to consider ways of minimising the impact of a future shortfall. The Government are already committed to taking action to address the issue of late payments and are bringing forward changes to the renewables obligation order to effect that change. I should also emphasise the Government's commitment to the renewables obligation as the most effective mechanism for delivering our renewable energy targets at an acceptable cost to the consumer. We have demonstrated that commitment by the announcement last December to increase the level of the obligation for the years between 2010–11 and 2015–16.
  A number of options for addressing the shortfall have been put forward in our discussions with the industry, and we had the advantage of some of those being voiced today when the noble Baroness, Lady Miller, moved the amendment. Most of the options are contained in the framework of the three amendments that we are discussing.
  While securing the buy-out fund, as suggested by Amendment No. 122, would no doubt provide some additional confidence in the market, it would do so at a high price. To require suppliers to put in place such security measures could have a harmful effect on competition by discouraging new entrants through the requirement to provide additional upfront funds. That burden would bear particularly heavily on smaller suppliers. The noble Baroness emphasised her concern about small suppliers. We also need to consider the costs to consumers. Noble Lords will be aware that those are very real problems with no obvious solutions within the timescale of the Bill. While we are therefore unable to accept these amendments, we recognise the spirit in which they have been moved. We are continuing discussions with the industry, given the seriousness of the problem, and the importance of a properly functioning renewables market.
  Amendment No. 123 envisages the widening of Ofgem's powers into areas that we do not believe fall naturally to it as a regulator. My most negative response is to Amendment No. 123, which seems to produce a series of functions for a regulator that are difficult to encompass.
  Lord Tombs: Perhaps I may challenge the Minister on what appears to be an uncharacteristic inconsistency. Does he agree that the renewables obligation itself constitutes an intervention in the free market?
  Lord Davits of Oldham: Certainly, in one sense it creates a special market. If I live long enough I probably could not think of a free market in economic affairs anywhere in the world. I hear what the noble Lord says; he has made an obvious point: there is an aspect of the renewables that is managed. I was seeking to emphasise something rather different from suggesting that the regulator should take up functions that would give the capacity for a whole range of very significant interventions in the market that would not normally fit in with the concept of regulation.
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  I move on to a slightly more constructive and positive point. While the Government support the aim of Amendment No. 144 which seeks to safeguard against supplier default, the amendment does not. of itself, provide any mechanisms that would reduce the likelihood of suppliers defaulting. As I have said already, the renewables obligation is a market-based mechanism, and in competitive markets, there are inevitably risks of failure. This provision could be seen as placing a duty on the Secretary of State to safeguard against supplier default, which is not consistent with our market-based approach—I believe I take the noble Lord, Lord Tombs, with me on that.
  Nonetheless, the Government take the issue of supplier default very seriously and we are working at present with the industry to develop means of reducing the likelihood of supplier default and mitigating its impact. Again, I give the undertaking to the Committee that if we make progress in sufficient time we shall bring forward government amendments to address that issue in the Bill. However, it will be recognised that the progress of the Bill is taking place against a background of a particular difficulty, occasioned last autumn. We have to address how we tackle that. In fact, the amendments are drawn from that experience, to see how we can rectify the situation for the future. I am asking for recognition by the Committee that, if we make sufficient progress before we get to later stages of the Bill, we shall introduce government amendments to incorporate an agreed solution to the issues that we are discussing with the industry.
  6.45 p.m.
  Lord Dixon-Smith: The Minister has made a slightly provocative statement, suggesting that if we do not make sufficient progress, he will not introduce the amendments. I am sure that is not his intention; if the amendments are justified in their own right, I hope that he will introduce them.
  Lord Davies of Oldham: I was suggesting that the amendments themselves do not necessarily produce the solution to the position that we need to arrive at and which we shall obtain through discussions and agreement with the industry. I am not in a position to say what we would do as a fallback position, beyond the amendments. I am saying that we shall strive to reach an agreement that enables us to table amendments at an appropriate stage of the Bill Of course, noble Lords will see the development of the position during the course of the Bill and will no doubt retable various solutions to the difficulties if they feel moved to do so.
  Lord Dixon-Smith: I am most grateful for the explanation, but from the way in which his statement was worded, it seemed that the future of the amendments depended on the progress of the Committee, rather than the progress of negotiations outside. He has made the matter plain and there is no need to say any more.
  Lord Ezra: I am a little surprised that there should be any qualifications about Amendment No. 144, as all it

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  does is enable the Secretary of State to work up solutions. I am sure that if a specific solution had been mentioned in the amendment, the Government would have found many reasons why they could not be applied, because the matters are complex and difficult. It would help if we were satisfied that the Secretary of State will address the problem; that is all that the amendment says.
  Lord Davies of Oldham: As I suggested in my initial remarks on the amendment, we are entirely in sympathy with the thinking behind it and we are already conscious of the necessity for action against the proposition. That is the action that we are carrying out at the present time. Because of the negotiations that are taking place and because we are still at Committee stage when there are opportunities to address the issue further, we are simply asking for a recognition that later we may be in a position to be categorical about our solutions to the situation and to provide exactly the right amendments to the Bill that will encapsulate the proposed solutions to the problem.
  Baroness Miller of Hendon: I thank the Minister for what was overall a sympathetic hearing to my remarks. I am not sure whether he was just trying to be charming—although he is always charming, as my noble friend has just said. He addressed my remarks kindly, but the bottom line is that the Government are as confused about how to find an absolute solution as we were in promoting a solution. I made it clear that we believed that securitisation was probably the better route, but on the other hand the problem is not easily solved. There can be difficulties with both options.
  I was interested in what the Minister said in discussing Amendment No. 122, when he said that it might interfere with the free market. I drew a deep breath and thought, "That is absolutely wonderful, the Government have come now to agree with the free market". However, the noble Lord, Lord Tombs, in his extraordinarily perceptive question, altered my point of view. The Minister then said that of course there was not a free market anyway, so we did not arrive at a situation that answered Amendment No. 122.
  I thank the noble Lord, Lord Ezra, for his support for Amendment No. 144. Perhaps the Minister could point out the words in the amendment that bother him. We are saying "as soon as practical", so the Government can choose the time after the passing of the Bill to make regulations to establish a scheme. The Minister says that of course he cannot accept the amendments yet, although he has sympathy with them—that was the nice part. Then my noble friend Lord Dixon-Smith used words that I had already written down: "If we make sufficient progress we shall find some solutions". I was very glad that that was clarified.
  However, the Minister said that it will take time to come to the solutions; therefore, it will be better if the passage of the Bill takes a long time so that the Minister has longer to find the solutions. The quicker
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  we are the worse matters will be. We are taking this serious amendment in a light-hearted fashion because we do not have an absolute solution and the Government certainly do not have one either. We understand that the Government will bring forward amendments shortly. Whichever way one looks at the matter, the bottom line is that, if there is a threat that people may not be able to pay the money and those who pay will somehow be obliged to meet the shortfall, there is a disincentive to people to become involved in the system. As long ago as December or November, the Government said that they certainly would not make up the shortfall, so there is a problem. With respect, the Government have to find the solution to the problem, however difficult it is.
  In a moment I shall withdraw the amendment, but first I would like to hear the Minister's response to the point raised by the noble Lord, Lord Ezra. What is wrong with Amendment No. 144? Which part of it does the Minister believe makes it impossible for him to accept? The amendment simply enables the Government, in due course—as soon as they are able—to make regulations to deal with the matter. The Minister has said that at some stage they will do something about it, but there is no timescale in Amendment No. 144 so I believe that the Minister could have been more direct.
  Lord Davies of Oldham: I apologise if I was less than direct. Part of the problem is that I have had a scattered approach to this group of amendments due to Divisions which have disturbed the coherence of my responses. Our anxiety about the proposed amendment is that potentially it would leave the Secretary of State liable for any failure. Accepting the amendment into the Bill—
  Baroness Miller of Hendon: I was referring to Amendment No. 144.
  Lord Davies of Oldham: The amendment seeks to deal with the problems of default by suppliers. If agreement with the industry has not been achieved within the framework of the Bill and, therefore, we are not able to put forward amendments that are clear and satisfactory, we have to guard against producing legislation that would make the Government responsible for failure. That would be the implication of the issue of supplier default.
  Baroness Miller of Hendon: I thank the Minister for giving way. I am afraid that, in my humble view, it does not do that. I accept that it is a humble view but, as I said earlier, two lawyers are advising me separately. Let us consider the issue. The amendment states:
  "The Secretary of State shall as soon as practical".
  It will be for the Government to decide when it is practical. So far as concerns the Government, it may never be practical and therefore the amendment is not prescriptive in any way. It simply states that as soon as the Government are in a position to do something after the passing of the Act, they will make regulations to establish a scheme.

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  The Minister said that the Government are to come forward with a solution at some stage. Therefore, the amendment simply seeks to ensure that one day, when possible and when the Government have considered the matter and taken soundings from everyone, they will, as they said they would in Committee, come forward with a solution. The amendment even goes on to state that supervision of the scheme can be delegated and so on. The word "may" appears in the second part of the amendment and the first part is constrained by the words "as soon as practical". If it simply stated:
  "The Secretary of State shall after the passing of this Act",
  I should accept everything that the Minister is saying. But the amendment deliberately does not say that. Under those circumstances, I consider it appropriate that we understand what is wrong in answer to the question posed by the noble Lord, Lord Ezra.
  Lord Davies of Oldham: I am no lawyer and therefore I hesitate to dispute the implications of the amendment. I believe that I can only convey to the noble Baroness and to the noble Lord who also spoke to the amendment that, despite the conditional words within it—I recognise how gently the amendment has been tabled and how constructive it is—we fear that its effect would be to place a duty on the Secretary of State which would then render him liable in these circumstances. That is our position.
  I have listened very carefully to what has been said today, and we shall examine the situation further. I am making this contribution against the background of strenuous efforts on our part to reach agreement with the industry and to solve the problems in order that the Bill can be implemented in time. That work is taking place with the greatest urgency and I make these comments against that background. That is our anxiety about the amendment and that is why, at this stage, I ask the noble Baroness to withdraw it.
  7 p.m.
  Baroness Miller of Hendon: I intended to withdraw it anyway, and I shall certainly not tire the Committee by mentioning it further. The Minister said all that I wanted him to say. I shall withdraw the amendment and the Government will consider the matter. That was all that was required. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 104 agreed to.
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 113:
  After Clause 104, insert the following new clause—
  "AMENDMENT OF ELECTRICITY ACT 1989

  (1)Section 32 of the Electricity Act 1989 (c. 29) (electricity from non-fossil fuel sources) is amended as follows.

  (2)After subsection (2) insert—

  "(2A) The supply of electricity from a generating station for the purpose of producing heating or a cooling effect in conjunction with electricity shall be an excluded category of supply provided that this subsection shall not apply to a generating station fuelled by the combustion of municipal solid waste."

  (3) In subsection (8)—
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  (a) in the definition of "fossil fuel" at the end insert "unless utilized in a generating station covered by section 41 A(9) of this Act";

  (b) in the definition of "renewable sources" at the end insert "including generating stations covered by section 41 A(9) of this Act"."

  The noble Baroness said: In moving Amendment No. 113, I shall speak also to Amendment No. 113ZA and, with the leave of the Committee, I shall touch on Amendment No. 113ZAA, which the noble Baroness, Lady Miller of Chilthorne Domer, has tabled as an amendment to my Amendment No. 113ZA. It may be easier if I deal with that while I am on my feet.
  The renewables obligation obliges licensed electricity generators in England and Wales to supply a specified portion of their electricity from renewables. Suppliers who cannot meet the percentage that they should must purchase renewables obligation certificates to make up their shortfall.
  While most CHP plant is intended to supply a particular industrial operation or site, if there is spare capacity the owner can become a licensed electricity supplier and sell it to the network. I would have thought that that should be encouraged, if only as a means of saving on the use of fossil fuels and reducing harmful emissions.
  The supplier will be subject to the renewables obligation and will have to buy ROCs to make up for any shortfall in his use of renewables. That is ridiculous. If, instead of putting his surplus current into the grid, he allows it to go to waste, perhaps by floodlighting his premises, leaving machines running all night and investing in an ornamental fountain, he would have to pay nothing. The rule places CHP generators in the same category as other generators, such as combined cycle gas turbines and coal-tired generating plant, which are not only less efficient than CHP, but emit far more CO2 per unit of electricity generated.
  The exemption of CHP from the renewables obligation is entirely justified by its energy efficiency. It will give a welcome boost to the technology now being developed. It is estimated that with the present liability to the renewables obligation it will cost the CHP sector about £100 million to support other renewable technologies by 2010, and that is hardly an incentive to get into the field. If potential CHP generators decide it is not worth their trouble to supply power to the grid, a whole slice of the Government's plans for reducing emissions, meeting our Kyoto obligations and supplementing our fuel supplies will simply be lost.
  Exempting CHP would be of immense benefit, for example, to the agriculture industry. As long ago as 2000, the Rural Commission urged the recognition of the benefit of agricultural CHP facilities. On the other side of the coin, the present situation has resulted in the loss of essential skills. I have been informed, for example, that a specialist turbine manufacturer in Newton Abbot has lost 25 per cent of its work force due to a reduction in the demand for CHP. The short

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  explanation of my amendment is that it would amend the Electricity Act 1989 so as to exempt CHP generating plants from the renewables obligation.
  The wording of Amendment No. 113ZA virtually speaks for itself. It follows logically from the argument in favour of Amendment No. 113. The plain fact is that the Government have no discernible policy on CHP, except for paying lip-service to the concept. However, it is not sufficient to be vaguely in favour of it, especially when, as I pointed out with regard to the previous amendment, far from encouraging the industry and the technology, owners of CHP plants are taxed and penalised in exactly the same way as the worst smoke producer in the country. The Government indicated that they were formulating a separate policy for this important source of supply and important way of reducing harmful emissions. However, it seems a long time in coming, and I do not understand why the policy could not have come in time for the White Paper and the publication of the Bill.
  The amendment is a probing amendment and is intended to extract a proper timetable from the Government. I remind the Committee, particularly the Minister, that CHP is one of the most cost-effective ways of reducing the United Kingdom's carbon emissions. Those are not my words; they are those of the Government's climate change strategy and the Performance and Innovation Unit's review of energy policy in 2002. As recently as last June, the DTI calculated that every 1,000 megawatts of electricity from CHP saved between 0.7 million and 0.9 million tonnes of carbon. CHP enhances security of supply, which is a vital consideration, bearing in mind that electricity demand is calculated to grow by up to 19 per cent by 2020, on the one hand, and gas to contribute up to 75 per cent of generating fuel, on the other. By that time, we will be talking about imported gas.
  CHP helps to tackle fuel poverty, as using CHP with community heating can cut consumers' bills by up to 20 per cent. Bearing in mind the Government's fuel poverty target—apparently already at risk—I believe that it is an important factor. None other than the Prime Minister emphasised all the points that I have just made.
  The Government's response to the Environment, Transport and Regional Affairs Committee's report on the climate change programme in August 2000 paid similar lip service to CHP. It states:
  "The Utilities Bill provides a power to the Government to secure additional use of CHP through obligations on energy supply or distribution utilities to encourage or support CHP development, equivalent to the provisions for the promotion of energy generation by renewables".
  But what has happened to that high sounding ambition?
  At Second Reading I referred to recent widespread losses across the CHP sector since the introduction of NETA. The failure to exempt CHP from the climate change levy and new regulatory costs being imposed on the sector by the extension of the renewables obligation are all contributing to CHP's problems.
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  More pious expressions of support from the Government are found in a letter from the Minister of State for the Environment to the CHP Association on 20 March 2000 which said in relation to the Utilities Bill:
  "I can confirm that the new powers for ministers to create obligations in relation to the promotion of energy efficiency could be used to create an obligation in relation to CHP".
  Despite those powers which were carried into the Utilities Act, in which Sections 58 and 79 gave the Government power to set an obligation in relation to a specific technology, including CHP, the Government have not taken advantage of this. On the contrary, as I have just said, their policies seem to militate against CHP. Why is that? The theory is that there is infighting between Defra—which has the responsibility for the Government's CHP target—and the DTI which regularly tells the representatives of the CHP industry that the CHP target is "nothing to do with them". This is even though the DTI has its hands on the levers that need to be pulled to set the UK on the path to the Government's CHP target—a target which will bring over £3 billion of investment into the CHP market and at the same time improve the competitiveness of the United Kingdom.
  When I began my speech on Second Reading I questioned why what was essentially a DTI Bill was being conducted through your Lordships' House by the Parliamentary Under-Secretary of State at Defra. However, there is definitely one advantage in this arrangement. The noble Lord, Lord Whitty, with one stroke of his ministerial pen, will be able to set CHP back on the rails again. This amendment would put an end to dithering and would give the Government a firm instruction within a very short time limit to formulate, promulgate and instigate a much delayed CHP policy.
  The amendment would give the Government six months from the passing of the Bill to draw up their long awaited strategy and should concentrate the Government's mind, especially if they can begin working on it this very day rather than wasting further time waiting for the Bill to complete its passage through Parliament. The proposed new subsections (2) to (4) in the new clause require the Government to implement the new policy as soon as it is formulated rather than consigning it to some pigeon hole or other. Anticipating a possible problem with the parliamentary timetable, the amendment would authorise the use of secondary legislation rather than having to wait for a full legislative slot to become available. The very minimum that I expect from the Minister today is a firm date by which the Government's policy on CHP will be announced, and details of how, and how soon they expect to put it into effect.
  With the leave of the Committee and while I am on my feet I should like to mention Amendment No. 113ZAA which is an amendment in the name of the noble Baroness, Lady Miller of Chilthorne Domer, to my Amendment No. 113ZA. I was very grateful to the noble Lord, Lord Ezra, for supporting my amendment. I am interested that the noble Baroness,

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  Lady Miller of Chilthorne Domer, has put down an amendment which may comprise a means of riding two horses at the same time.
  The amendment would require the policy to be formulated by the Secretary of State to distinguish between domestic and commercial users. I believe that on the face of it, this does not detract from my basic proposal. I do not really have a problem with it; the only thing is that the Government might say that it was too prescriptive, but I know not. I beg to move.
  Lord Ezra: I support strongly the emphatic way in which the noble Baroness, Lady Miller of Hendon, has spoken to Amendments Nos. 113 and 113ZA. My noble friend Lady Miller of Chilthorne Domer will be dealing with Amendment No. 113ZAA, in her name.
  The Government's attitude towards CHP is becoming increasingly anomalous, as the noble Baroness pointed out. On the one hand, we have the strongest possible verbal support. All government publications on energy policy strongly support the concept of CHP for the reasons that the noble Baroness gave. On the other hand, the policy to support those warm statements is increasingly lacking. CHP is now going through a very difficult period, and has been for some time.
  The report issued by the Government on CHP policy last year was extremely disappointing. It simply enumerated the measures which the Government had been taking without in any way indicating what further measures might be taken. Let us hope that the next report which the Government produce will show what should be done additionally to bring about the benefits which they freely admit would flow from CHP.
  Meanwhile, Amendment No. 113 would correct a long-standing anomaly—that CHP-exported electricity is penalised under the renewables obligation arrangements. It seems extremely odd that the Government have effectively required one low-carbon technology—CHP—to cross-subsidise another low-carbon technology—namely, at present, wind. This just does not add up, and I should have thought that Amendment No. 113, as one step towards supporting CHP, was a highly desirable proposal for the Government to accept.
  Baroness Miller of Chilthorne Domer: First, I strongly support Amendments Nos. 113 and 113ZA. The only reason I have not put my name to Amendment No. 113 is because there are four names to it.
  Amendment No. 113ZA is really a probing amendment for the Government. It is in no way intended as a criticism of the first amendment in the group. My noble friend Lord Ezra has much greater expertise than I in matters relating to CHP and the frustrations arising from the Government's attitude to it.
  My amendment is tabled simply to discover whether the Government have understood the importance of the two different sectors—the domestic user and the industrial and commercial user. Accepting
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  Amendments Nos. 113 and 113ZA would hit a large number of their targets for the domestic user in addressing fuel poverty, as well as providing affordable warmth and cheaper electricity, as Tony Blair himself said when talking about CHP. In addition, the industrial and commercial users would reduce emissions and use less fossil fuel. My amendment is simply to indicate the two very different sets of targets that the Government claim to have for two very different sectors, and both of them can be met by the amendments.
  7.15 p.m.
  Lord Whitty: I readily accept that CHP can make a significant contribution towards energy management and reducing carbons because of its recycling of heat, and that the objectives for CHP under our energy policy are ambitious. At present, we are not on a trajectory to meet them, so one could argue that CHP requires additional support to meet even the 2010 target of 10 gigawatts of CHP in operation.
  The amendments, and the first one in particular, suggest a degree of support for CHP that would have knock-on effects for the rest of the energy industry. It tries to take three different approaches. First, it seeks to remove CHP from the base of those subject to the renewables obligation. Secondly, it seeks to define CHP as a renewable energy source for the purposes of the renewables obligation. Thirdly, it would redefine "fossil fuel" so as to exclude CHP.
  There are serious problems with all of those proposals, although some are more substantial than others. The fact that we need to give further thought to the support and promotion of CHP is accepted by the Government. Indeed, as the noble Lord, Lord Ezra, said, we shall need to introduce a further CHP strategy very shortly. Moreover, in terms of the interaction between CHP and the ROC provisions, as we said in the energy White Paper we shall undertake a review of the obligation in 2005–06. I can give the commitment now to the Committee that part of that review will be to consider how CHP is handled in the context of the renewables obligation.
  However, we need to be careful. The renewables obligation is intended to deliver a very substantial part of the energy policy in terms of the renewables figures. If we undermine that, there is no point in boosting CHP slightly. That is almost the obverse of the argument that the noble Baroness was using. We need to ensure that the renewables target is met and not undermined by anything we do for CHP, which should not be considered in isolation. If we removed CHP from the base on which the obligation is based, we would automatically reduce the size of the renewables market, which would threaten the delivery of the renewables target.
  We need to maintain investor confidence in the renewables sector, as we need to remotivate investor confidence in CHP. However, proposed changes that would undermine investor confidence in renewables are not a sensible way in which to do that. Indeed, the CHP sector would not receive a huge boost were we to do that.

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  Redefining CHP as renewable and including it under the renewables objective would have a far more major effect in relation to the renewables target. Existing CHP schemes generate far more electricity than the current level of the obligation. The output from the CHP target, if we meet the 10 gigawatts, will exceed the renewables obligation for 2010. It must be borne in mind that CHP is in most circumstances based on fossil fuel. There are exceptions; there is some CHP that is based on biomass, but in general it is based on fossil fuel. Its contribution in terms of our international obligations under the renewables directive is not allowable under that indicative target.
  There is another alternative, I suppose, in that one could increase the size of the renewables obligation to take account of CHP so redefined. But that in itself would place a greater burden on the delivery of all the various strategies. Only in the circumstances in which CHP was using a renewable source could it be defined as a renewable fuel. None of that obviates the need for us to look at CHP and to see what more we can do for CHP, but I do not think that the amendments as they stand would achieve that. At least they would not achieve it without serious detriment to our other main target on renewables.
  Amendments Nos. 113ZA and 113ZAA are unnecessary, in the sense that they do not do anything more than the Government are already doing. We have published the strategies on combined heat and power. We now intend to publish the final version after the Easter Recess to coincide with the publication of the first year review of the energy White Paper. That strategy will help to provide the foundation for a more secure future development for CHP.
  There are a number of measures which the noble Lord, Lord Ezra, said are not sufficient. Nevertheless, there are a number of measures already in place, the full effect of which need to be taken into account. The amendments to require greater reporting than we already do on CHP I think are unnecessary. The content of those amendments are already contained in the commitments the Government have given, are in the energy White Paper and will be reflected not only in the CHP report of the final strategy we intend to issue after Easter but also in the other documentation we intend to produce at that time. Specifying one particular area of that by legislation is not particularly appropriate.
  So, while recognising the essential problem and that noble Lords are attempting to find solutions to it, I do not think that the Government could accept what is contained in Amendment No. 113. Certainly, the attempt to approach it on three different bases, all of which have some implications for the renewables target, is not sensible.
  Baroness Byford: The Minister in his response to my noble friend's amendment has highlighted the problems that we face with the Bill. The honest truth is that the Government have no strategy at all. That is why we are labouring under such difficulties. From our debates yesterday on the climate change, the
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  Government clearly have no strategy on nuclear. They obviously have a confused strategy on CHP. We have a certain amount of wind strategy; we are not even considering other forms of renewables within the Bill. I know that we shall not reach the amendment tonight on either biofuels or biodiesel. Biomass and wave power are not mentioned.
  I have to say to the Minister that I am not surprised that some of these amendments moved by noble friend have been moved in such detail and with such great difficulty. It is difficult when one is actually fighting to try and get some form of sense into the Bill and all we are told is, "We are going to think about it. There is a final version coming after Easter. More documentation will be laid". I know it is late and I am not getting at the Minister. That makes it difficult for us all. It is difficult for him, but I can assure him that it is that much more difficult for this side of the Committee. So while some of his words are encouraging, I really feel I should put on record the fact that if the Government had a strategy it would make my life much easier.
  Lord Whitty: I have to say to the noble Baroness that, with the best will in the world, the Government have a strategy for energy, which was set out in the White Paper. She may not agree with all aspects. She clearly does not agree with how we treated nuclear energy, but there is a very clear strategy. There are certain measures in that strategy which set out to deliver the objectives. We may need to come forward with other measures, both immediately and longer term. We recognise that. That is part of making sure that the strategy is delivered.
  However, a piece of legislation is not a strategy. We have a clear strategy. We have measures, as I say, to deliver it. We may need to deliver parts or all of it. But I do not think that the Government can be accused of not having a strategy. This compares somewhat starkly with the fact that we did not really have an energy strategy for the previous 20 years. Effectively, the only policy then was to get energy as cheaply as possible through various competitive measures, some of which worked. But we did not have any clear idea of where we wanted the balance of energy to work out, or how we faced up to the environmental challenges which a free-for-all in energy was bound to produce.
  I feel slightly over-sensitive perhaps about accusations over strategy. I also think that the noble Baroness should be a little sensitive in that previous governments never produced any strategy whatever. While there may be parts of our strategy we still need to develop, and perhaps we can discuss those, they are at the outline of the strategy. The objectives of that strategy are fairly clear. I am sorry to make such philosophical and political points at this stage of the evening, but I doubt that we shall reach another amendment, and therefore I thought that I would place that on the record.
  Baroness Miller of Hendon: The Minister is right to have his say, given that I seem to have been speaking

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  for a long time, as did the noble Baroness, Lady Miller of Chilthorne Domer. I expect that the Minister wanted to get something off his chest.
  I say to the noble Baroness, Lady Miller of Chilthorne Domer, that I totally understand what she said. I did not have any problems with it, other than the fact that the Government are always saying that these things arc too prescriptive, and I thought that that would give them an excuse to say no to the proposal altogether. I understand what the noble Baroness said about being on the Front Bench with the noble Lord, Lord Ezra, and I agree totally with what she said. There is the noble Lord, Lord Tombs, and last week we heard from my noble friend Lord Jenkin of Roding. Sometimes, those of us who come to energy as part of a much bigger brief feel that it is nice to have experts around us. Although we do the very best that we can without the benefit of officials sitting behind us and we try to put forward everything in the best way that we can, the fact is that these are complicated matters. We are aware of that and are trying to do the best that we can.
  I shall not enter an argument with the Minister about whether the Government have a strategy or whether we had a strategy. It is too late in the evening for that. I shall say only that many people felt that the
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  energy White Paper was deficient not only because the Minister said to my noble friend Baroness Byford, "Well, it's because you didn't say you wanted us to say something about nuclear energy; we never mentioned nuclear. Whether we did or did not want that or would or would not want it, it is for the Government to decide what they want in an energy White Paper, and that is how we are content to leave it". However, many people believed that what was in the energy White Paper would not produce sufficient energy to ensure that we had sufficient light and warmth and so on. CHP is one way in which we were trying to bridge the gap. I believe that that is important. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 113ZA and 113ZAA not moved.]
  Lord Davies of Oldham: This may be a convenient moment to suggest that the Committee adjourns until 2.15 p.m. on Thursday.
  The Deputy Chairman of Committees (Lord Hogg of Cumbernauld): The Committee stands adjourned until 2.15 p.m. on Thursday.
  The Committee adjourned at twenty-seven minutes past seven o'clock.

  Northern Ireland Civic Forum
  Northern Ireland Civic Forum
  Northern Ireland: Railways
  Northern Ireland: Railways
  House of Lords: Political Affiliations
  House of Lords: Political Affiliations
  Hutton Report
  Hutton Report
  European Council: Member State Delegations
  European Council: Member State Delegations
  EU: Regulations and Directives
  EU: Regulations and Directives
  Saddam Hussein: Legal Proceedings
  Saddam Hussein: Legal Proceedings
  Iraq: UK Government Staff Seconded to Coalition Provisional Authority
  Iraq: UK Government Staff Seconded to Coalition Provisional Authority
  Sentencing
  Sentencing
  Gender Recognition
  Gender Recognition
  Professor Sir Roy Meadow
  Professor Sir Roy Meadow
  NHS: Waiting Times
  NHS: Waiting Times
  Disabled People: Advocacy
  Disabled People: Advocacy
  Health Professions Council
  Health Professions Council
  Healthcare Professionals: Recruitment
  Healthcare Professionals: Recruitment
  NHS Trusts: Funding
  NHS Trusts: Funding
  Voluntary Work
  Voluntary Work
  Transport of Animals
  Transport of Animals

  Common Agricultural Policy Reform: Northern Ireland
  The Lord President of the Council (Baroness Amos)
  My honourable friend the Parliamentary Under-Secretary of State for Agriculture in Northern Ireland has made the following Statement:

  The Department of Agriculture and Rural Development for Northern Ireland launched a major consultation exercise in September 2003 covering the choice of the main implementation options arising out of the CAP reform agreement reached in Luxembourg on 26 June 2003. The consultation ended on 16 January 2004 and after having considered stakeholder responses and the relative merits of the available choices, I have decided to deploy the following options in Northern Ireland.

  Full decoupling of direct producer support will be implemented across the beef, sheep and arable sectors.

  Full decoupling of direct producer support will be introduced in the diary sector from 2005.

  The model of decoupling used will be a static vertical hybrid based partly on eligible land held in 2005 and partly on past patterns of individual producer subsidy claims.

  National envelopes will not be deployed at this point.

  Decisions on the use of the additional rural development regulation options are deferred and will be considered as part of a separate consultation exercise on future modulation policy scheduled to commence in March 2004.

  Fire and Rescue Authorities: Charging
  The Minister of State, Office of the Deputy Prime Minister (Lord Rooker)
  My right honourable friend the Minister for Local Government, Regional Governance and Fire has made the following Written Ministerial Statement.

  I have today made available copies of a consultation document on charging for services by fire and rescue authorities in the Libraries of the House.

  Authorities already have a power under the Fire Services Act 1947 to charge for services other than fighting fires. The White Paper Our Fire and Rescue Service gave a commitment to continue to provide such a power and to consult on any proposals to extend the charging regime.
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  Clause 19 of the Fire and Rescue Services Bill currently before this House provides for the Secretary of State to specify by order the services for which an authority may levy a charge.

  The consultation document contains details of the services for which authorities in England and Wales currently levy a charge and these form the basis of our proposals. Comments are welcome on any part of our proposals. In particular, we welcome responses on the direction of travel in respect of the provision by authorities of detailed advice or consultancy.

  The consultation period will close on 7 May 2004.

  Community Radio
  The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord Mcintosh of Haringey)
  My right honourable friend, the Secretary of State for Culture, Media and Sport (Tessa Jowell) has made the following Written Ministerial Statement.

  The Department for Culture, Media and Sport has today published a draft Community Radio Order, associated Keeling Schedule and Explanatory Memorandum for public consultation. Copies of these documents are available in the House Libraries, or from the department's website. The department welcomes comments and the consultation period will last until 20 April 2004.

  This order proposes to introduce a new tier of very local, not-for-profit (or not profit-distributing) radio. Community radio should be different from, and complementary to, existing independent local radio. Community radio offers potential benefits in terms of social inclusion, local educational, training and experience, wider access for communities to broadcasting opportunities.

  The Communications Act provides for the possible establishment of a fund to support community radio. Ofcom will shortly be publishing its own draft guidance on how to apply for community radio licences.

  Union Modernisation
  The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville)
  My honourable friend the Parliamentary Under-Secretary of State for Trade and Industry (Gerry Sutcliffe) has made the following Written Ministerial Statement.

  Today, I tabled an amendment to the Employment Relations Bill concerning the provision of a new funding scheme. The amendment inserts a new section into the Trade Union and Labour Relations (Consolidation) Act 1992 which would create a power for the Secretary of State to make funds available to independent trade unions and federations of trade unions to modernise their operations.
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  I envisage that the size of the fund would be in the region of £5 million to £10 million in total, with expenditure spread over several years, probably beginning in 2005–06. The funding scheme would be used to support innovative projects in such areas as:

  training union representatives (for example in the area of business and people management) in order to help to promote the development of high performance workplaces;

  reviewing internal union structures and organisation and to support more efficient management systems within unions;

  enabling unions to broaden their dialogue with members by greater use of the Internet and other new technologies and to develop innovative and user-friendly voting mechanisms; and

  making union systems more accessible to young people and other underrepresented groups within unions.

  The case for establishing a fund is compelling. Unions, just like businesses, need targeted support to speed their adaptation to changing labour market trends and to new ways of working. Unions have done
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  much to modernise themselves and several, often supported by the TUC, have made significant progress in that direction. However, as a number of representations from unions have confirmed, without assistance the pace of change will be slow. By encouraging unions to adapt more quickly, we will ensure that they play their full and considerable part in building productive relations at work. That will benefit union members, other workers, their employers and the economy more generally.

  The fund will not therefore be used to support the day-to-day work of unions, and it will not impact directly on collective bargaining. It will not be used to support projects which could be funded from other government programmes.

  Subject to parliamentary approval of this new provision, the Government will publish for full public consultation the draft rules and procedures of the fund after Royal Assent. It is likely that these rules and procedures will draw on the example of the Partnership at Work Fund, involving an independent advisory board who will make recommendations to my right honourable friend the Secretary of State on the acceptability of union bids for fund money.