Sitting of 14 July 2004

Preamble
The House met at half–past Eleven o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRAYERS

  REVIEW OF INTELLIGENCE ON WEAPONS OF MASS DESTRUCTION
  Resolved,
  That there be laid before this House a Return of the Report of the Review of Intelligence on Weapons of Mass Destruction.—[Ms Bridget Prentice.]

  REVIEW OF INTELLIGENCE ON WEAPONS OF MASS DESTRUCTION
    Speaker's Statement
    Mr. Speaker: Right hon. and hon. Members will be aware that Lord Butler is due to publish his review of intelligence on weapons of mass destruction later this morning. I am aware of the considerable interest in Lord Butler's findings. In these exceptional circumstances, I have agreed that the Prime Minister will make a statement on this matter this afternoon. The statement will take place at 1.30 pm.
Oral Answers to Questions
  INTERNATIONAL DEVELOPMENT
  The Secretary of State was asked—
  INTERNATIONAL DEVELOPMENT

    Forestry Projects
    Mr. Graham Allen: Pursuant to his oral answer of 16 June 2004, Official Report, columns 758–9, on debt swaps, what progress has been made by the continuing forestry projects to which he referred.[183716]
    The Parliamentary Under-Secretary of State for International Development (Mr. Gareth Thomas): The Indigenous Peoples' Project has approved funding for about 30 projects promoting land demarcation and sustainable development in the Brazilian rain forest. In addition, the project seeks to support a number of indigenous movements and their leaders to be better able to articulate, defend and promote the rights of their peoples. Further support has been provided for the strengthening of the umbrella organisation for the indigenous people of the whole of the Brazilian Amazon.
    Mr. Allen: Is my hon. Friend aware that the Commonwealth Development Corporation, which is heavily involved in forestry, is being accused by native peoples in Papua New Guinea and Indonesia of driving
    1392
    deforestation? Is he also aware that the central point of expertise that was established to fulfil the Government's promise of legal and sustainable sources for all timber coming into this country is neither adequately funded nor fully up and running, four years after that promise was made? Will my hon. Friend undertake to write to me on those two detailed questions, so that we can ensure that the UK purchases timber only from legal and sustainable sources?
    Mr. Thomas: I am happy to write to my hon. Friend, as he requests, with detailed answers to the specific questions he raises. However, I can reassure him on the question of illegal logging. The UK has been at the forefront of a series of efforts across the continents to tackle the issue of illegal logging. For example, we have committed to a new programme of work on forest governance and trade in west and central Africa, following the ministerial conference that I attended last year, and we have led the debate in Europe on how we can ensure that traders bringing timber into Europe can verify that their supplies have not been logged illegally. We expect that the regulation to achieve that will shortly be brought before the EU College of Commissioners.

    Maghreb
    Mr. Gordon Marsden: What assistance his Department is giving to the development of (a) civil society and (b) women's rights in the countries of the Maghreb. [183719]
    The Parliamentary Under-Secretary of State for International Development (Mr. Gareth Thomas): DFID does not have any bilateral programmes in the Maghreb region. However, working with colleagues at the Foreign and Commonwealth Office, we have successfully encouraged the EU through its MEDA programme to use its resources to assist civil society organisations and to promote women's rights. In addition, the FCO's global opportunities fund supports a number of projects in the Maghreb region that seek to increase the participation of women and promote good governance.
    Mr. Marsden: I thank my hon. Friend for that reply. This is a critical and opportune time for north Africa and the countries of the Maghreb. I had the privilege of chairing a conference with their Foreign Ministers here two or three weeks ago, and the emphasis was on the building up of civil society and, especially, the extension of women's rights, to which Baroness Symons referred. Will my hon. Friend work closely with his colleagues in the Foreign and Commonwealth Office to promote and develop our relations with the Maghreb? Those countries should not be seen as only within the French sphere of influence: they are keen to have support and encouragement for civil society projects and women's rights from Britain.
    Mr. Thomas: I congratulate my hon. Friend on chairing and initiating the conference to which he referred and on his work on the issue over a long period of time. As he may be aware, a series of donors already provide substantial aid in the Maghreb region. The Commission, for example, provides some €700 million

    1393
    to the middle east and Africa and a further €30 million to Mauritania. I can give a specific example to offer my hon. Friend encouragement that the type of work he wants to see is happening. In Mauritania, about €10 million have been set aside to build up the capacity of civil society organisations and to promote human rights. Clearly, more is needed and the European Commission, at the most recent Council of Ministers, made a commitment to do just that.

    Sudan
    Mr. John MacDougall: If he will make a statement on action the Government are taking to prevent a humanitarian disaster in Darfur province in Sudan. [183720]
    Mr. Richard Bacon: What recent representations he has received regarding the humanitarian situation in Sudan. [183721]
    The Secretaryuof State for International Development (Hilary Benn): The humanitarian situation in Darfur, western Sudan, is of the gravest concern and the need for food, water and shelter is enormous. Civilian protection is also a major concern, with reports of systematic attacks. With our EU partners, we have made it clear that all alleged attacks should be thoroughly investigated and the perpetrators brought to justice.
    The UK has now allocated £62.5 million for humanitarian aid, which will include an additional £28 million for this year, as I announced yesterday. We are in daily contact with the Sudanese Government, nongovernmental organisations and UN agencies both to ensure that humanitarian relief gets to those in need and to seek to improve security for the long-suffering people of Darfur.
    Mr. MacDougall: I am grateful to my right hon. Friend for that response and I am pleased to hear his comments about the progress that has been achieved. Does he agree, however, that there are still significant gaps in humanitarian assistance and supplies to the camps, and that despite all the good work progress remains to be made? Can he comment on that?
    Hilary Benn: My hon. Friend is entirely right, although I can tell the House that the UN reports significant progress on humanitarian access and on the removal of the constraints that aid agencies have faced. There are now 31 NGOs registered in Darfur, including most recently World Vision International, which has expressed thanks to the UK for our help in getting its registration through. That enabled the organisation to send two airlifts to the region last Sunday, but the needs remain enormous. Time is very, very short and although there are now 300 international humanitarian staff in Darfur, the UN estimates that 1,000 are needed, so we must continue the effort to ensure that help gets to the people who need it.
    Mr. Bacon: Given the intense diplomatic activity of the Government and the UN Security Council in relation to Iraq, were we not entitled to expect more intense activity and pressure from the Government and
    1394
    the Security Council in relation to what is going on in western Sudan? When can we expect a robust UN Security Council resolution on the issue?
    Hilary Benn: The UK has been vigorous both through the diplomatic channel and through the humanitarian work that I have just described. The hon. Gentleman will be aware of the reference to Sudan in the Security Council resolution passed in June and, I hope, of the resolution passed by the African Union at its summit last week, which was extremely significant and made clear the concern of the countries of Africa about what is happening. Like the United States and others, we have told the Government of Sudan that if there is not rapid progress in delivering the commitments that they have entered into—not just on improving access for humanitarian aid, but on ensuring security, which is the cause of the crisis—we shall have to return to the Security Council to take further measures, because if that is what is needed to protect the people of Darfur, that is what we shall do.
    Mr. Tom Clarke: I welcome the increased aid that my right hon. Friend announced this week, as well as the additional £150 million over the next three years that the Chancellor announced on Monday. Will my right hon. Friend continue to be resolute with the regime in Sudan to ensure that there is an infrastructure, so that aid can be delivered, and especially so that trucks are allowed access to those who desperately need what we want to provide?
    Hilary Benn: I am happy to give my right hon. Friend that assurance. He rightly refers not only to the additional aid that we have been able to give for the humanitarian crisis, but also to the aid framework that we want to put into development in Sudan when there is peace—not just peace as a result of the Naivasha process but peace in Darfur. That is a product of the generous increase in the UK aid budget that the Chancellor announced on Monday. My right hon. Friend is also right to note that real obstacles remain, including shortages of aviation fuel and diesel for the airlifts and of the trucking required to get help to the people who need it. We have to address each and every one of those problems with vigour and speed if we are to get help to the people who need it.
    Mr. Robert Key: Please will the Secretary of State tell us what progress has been made in the application of satellite technology to provide security and humanitarian aid in the area?
    Hilary Benn: The hon. Gentleman raised that issue with me when I made my statement. Yesterday, I looked at a report that Amnesty International has produced that does indeed use satellite technology to identify the villages that have been attacked. I shall, as promised, write to him shortly with further information on that subject. That demonstrates how satellite technology can assist, and the other issue that I will raise with the AU ceasefire monitors is precisely the extent to which they may be able to use it to aid them in the task. There are now 30 monitors in Darfur. They have already

    1395
    undertaken four investigations. They have access to three helicopters, and it is important that we continue to support them in deploying as quickly as possible.
    Mr. Malcolm Savidge: Will my right hon. Friend expand on the UN's current and prospective involvement in Darfur?
    Hilary Benn: The UN agencies have been present for quite some time. As I have said in the House previously, they were in the past, frankly, slow in responding to the scale of the crisis. The situation has improved since first Kevin Kennedy arrived for three weeks, and now Eric Damor has been appointed as the acting resident coordinator. Next week, I will talk to Carol Bellamy of UNICEF and Jan Egeland, the UN emergency relief coordinator. I have also had conversations with Jim Morris of the World Food Programme. What is required now is for all the agencies—the UN, the
    international NGOs and financial support from the international community—to come together to exert maximum effort to ensure that the relief that is needed gets past the obstacles, including the security problems that the UN and other agencies continue to face.
    Mr. John Bercow: Given the harrowing plight of those in the internally displaced people's camps in Darfur, which I saw for myself only two weeks ago, what representations has the Secretary of State made to the Government of Sudan about reports that local authorities are still demanding travel permits in some areas? Does he accept that Khartoum's 90-day registration plan makes many NGOs reluctant to increase their asset bases because they simply do not know whether their permits will be renewed?
    Hilary Benn: I am, of course, aware of the problem to which the hon. Gentleman refers. Overall, the reports that we have had—I spoke to our ambassador in Khartoum this morning—show significant improvements in humanitarian access, but the hon. Gentleman is right to draw attention to the continuing difficulties with the local interpretation of travel permits, and we continue to pursue that issue regularly with the Government of Sudan. I am also aware of the problem that he identifies about 90-day registration. We take things a stage at a time, and as we have got that 90-day registration window, he can rest assured that I will continue to do all that I can to ensure that, having got in the NGOs and given that the crisis will last for a very long time, they are able to stay.
    Mr. Bercow: I am grateful to the right hon. Gentleman for that reply. Obviously, humanitarian improvement and sustainable peace are inextricably linked to each other. Further to the inquiry made by my hon. Friend the Member for South Norfolk (Mr. Bacon), will the Secretary of State tell the House what, if any, objection the Government have to the passage now of a tougher UN Security Council resolution that condemns unequivocally the Sudan Government for human rights abuses and demands that the abuses be internationally investigated, that the ceasefire and human rights monitors be vastly increased in number, that an assurance be given that people will not be forced to go home until it is safe to do so and that all the militias
    1396
    will be disbanded immediately, failing which a robust UN sanctions regime will be applied within weeks and a UN protection force deployed before we see in Darfur a replay of the human horrors experienced in Rwanda.
    Hilary Benn: The words "failing which" that the hon. Gentleman used are the key to the progress. The Government of Sudan have given commitments on security, so it is right and proper that they should be given a chance—they have a short time—to deliver on those commitments in exactly the same way as we gave them a period to deliver on their commitments on humanitarian assistance, on which we are now seeing progress. That progress is unquestionably the result of international pressure. If the Government of Sudan fail to honour the commitments that they have given on security—to disarm the Janjaweed militia and to send in the police forces that they have promised—we will not hesitate to return to the Security Council to continue to apply pressure to ensure that there is further progress.
    Tony Lloyd: My right hon. Friend is absolutely right to emphasise the fact that security is at the centre of delivering humanitarian aid and making a difference. Does he appreciate that the Opposition's request for a clear and tough line would be supported by Labour Members and the Government? It is important that Khartoum is left in no doubt that the international community demands that it not only dissociates itself from the paramilitaries, but makes it clear that it will bring those engaged to justice. There is a suspicion that Khartoum will use weasel words yet continue to support those people unless the international community is resolute in its view and takes action.
    Hilary Benn: I recognise the strength of feeling on both sides of the House, not least because I share it. My hon. Friend can rest assured that the Government are doing precisely what he is asking for. We have been playing a leading role in putting pressure on the Government of Sudan, as my conversation with Sudanese Government Ministers demonstrates. I assure my hon. Friend that we will continue to do that because it is the key to progress, which is what the people of Darfur need.
    Tom Brake: Does the Secretary of State agree that humanitarian aid will have been effective only if the refugees feel safe enough to return to their homes? How many Janjaweed have been charged and how many have been disarmed? How many weapons have been collected, and what safeguards are in place to ensure that the Janjaweed—who I understand are being incorporated into the police—will not simply carry on harassing the refugees?
    Hilary Benn: On the hon. Gentleman's latter point, we have made it clear to the Government of Sudan that the refugees' sense of security will not be increased if, as one person put it to me when I visited Darfur, the Janjaweed return with police officers' badges on their chests. The Government of Sudan are sending police from other parts of the country to Darfur because they realise the force of that argument.
    Some reports suggest that attacks from the Janjaweed militia are declining in some parts of Darfur, but other reports indicate that there is increased conflict between the Government and the rebels. Some of the vital access roads that are needed to deliver humanitarian supplies are currently blocked, which is being monitored on a daily basis. We need to see indications of progress, which explains why the AU ceasefire monitoring force is important. With the helicopters that it now has, it can investigate incidents and report back to the whole of the international community on the steps that the Government of Sudan need to take to improve security.
    David Taylor: I heard the Secretary of State say that he is having discussions with UNICEF. Will he include on the agenda an update on the appeal that it launched only last month for £25 million, which will help the displaced communities in Darfur and Sudanese refugees in Chad, especially the thousands of children who are at risk of dying from entirely preventable diseases such as malaria and measles, and conditions such as diarrheea? Will he help UNICEF to reach its targets?
    Hilary Benn: I certainly will raise those issues during my discussions with Carol Bellamy next week. I can tell my hon. Friend that despite the coverage of the measles vaccination campaign, there are reports of outbreaks of measles. A further mop–up vaccination programme is planned. We are able to support UNICEF and other agencies because we have a rising aid budget—the UK is now the largest cash donor to the humanitarian situation in Darfur. That situation is in sharp contrast to Opposition calls for the budget to be cut.

    Zimbabwe
    Mr. Henry Bellingham: When he next expects to meet representatives of aid agencies to discuss ways of ensuring that aid to Zimbabwe reaches the poorer districts. [183722]
    The Secretary of State for International Development (Hilary Benn): I discussed humanitarian needs in Zimbabwe with the head of the World Food Programme earlier this month, and we are in regular contact with other UN agencies, major donors and non-governmental organisations. Recent Government claims of a bumper harvest are simply not credible. If large amounts of food aid are needed later in the year. UN agencies have warned that the international response could be delayed until there is more openness and co-operation with the UN. The Department for International Development and other agencies will continue to provide targeted help to the most vulnerable districts and sections of Zimbabwean society, including people affected by HIV/AIDS and vulnerable children.
    Mr. Bellingham: I am grateful for that reply, but there is now overwhelming evidence that Mugabe and ZANU-PF, having destroyed their own agricultural sector, are preventing food from getting through to the poorest communities. Surely more can be done to supervise the distribution of food, or this evil dictator will have succeeded in his strategy of getting re-elected on the back of systematically starving the Opposition.
    Hilary Benn: I share the hon. Gentleman's concern about the situation in Zimbabwe. He will be aware that
    1398
    the Government of Zimbabwe predict a 600,000 metric tonnes maize surplus We do not agree with that. The international assessment is that there will be an 800,000 metric tonnes shortfall. It is the people of Zimbabwe who will pay the price, as he just said, for their Government getting it wrong. We retain the procedures that we have in place to ensure that the food aid that the international community gives is not used for political purposes, but none of us controls the distribution mechanism run by the, Government of Zimbabwe.
    Mr. Bill Olner: Can the Minister tell the House just how robust the intelligence is about the situation in Zimbabwe? It is essential that food gets through to the poorest people and is not used as a political weapon by ZANU-PF. Are we enlisting the agencies in South Africa to assist in gaining that robust intelligence?
    Hilary Benn: I agree about the importance of having access to reliable information about what is going on. That is not helped by the fact that both the crop and food assessment surveys were cancelled by the Government of Zimbabwe—one can only assume because they do not want to know the real position. However, our estimates are based on the best intelligence and information available.
    We continue to provide help to the poorest households—those that are suffering greatly. We are also running a clinic-based feeding programme for the under-fives, to help those who are most affected.
    Mr. Julian Brazier: Through the Government's investigation, they have accepted that the Mugabe regime stole a great deal of aid in the past. Will the Minister also accept that aid workers in Movement for Democratic Change areas have been attacked and food distribution centres forcibly closed, and that ZANU-PF is delivering food to its supporters? Given that most of Zimbabwe's close neighbours are heavy recipients of aid from this country, when will the Government put some real pressure on them to assist us in getting Zimbabwe out of the dark ages? [Interruption.]
    Mr. Speaker: Order. The House must come to order.
    Hilary Benn: The hon. Gentleman will be aware that the United Kingdom Government have been very strong in their condemnation of what is going on and very robust in their conversations with Zimbabwe's south African neighbours about the steps that they need to take to bring the current intolerable situation to an end. In that respect, I welcome what Kofi Annan said to the AU summit last week. I also welcome the summary of the fact-finding mission to Zimbabwe, carried out by the African Commission on Human and Peoples Rights, which speaks openly about the testimony it received
    "from witnesses who were victims of political violence and other victims of torture while in police custody. There was evidence that the system of arbitrary arrests took place."
    It is a welcome sign that the African Union is beginning to take responsibility for the action required to bring an end to the suffering of the people of Zimbabwe.

    Renewable Energy
    Lynne Jones: What his policy is on the encouragement of renewable energy technologies in developing countries. [183723]
    The Parliamentary Under-Secretary of State for International Development (Mr. Gareth Thomas): We work alongside a variety of agencies, including the World Bank and the European Union, to promote better access in developing countries to affordable and reliable energy services, including renewable energy, especially to the very poorest and those living in remote and rural areas.
    Lynne Jones: Solar voltaics are close to commercial viability in areas that are not connected to an electricity grid. Will the Government do more, both here and abroad, to support solar energy, because increased demand has been shown to be the best way of reducing costs? That would help more people in developing countries to enjoy improved energy supplies without adding to the demand for fossil fuels.
    Mr. Thomas: My hon. Friend is right. Solar voltaics have the potential of offering many of those who live in very rural areas—often the poorest people in developing countries—access to energy. We want to persuade the World Bank to go further than its commitment at the Bonn renewables conference, where it said that it would seek to increase funding for renewables by 20 per cent. in each of the next five years to some $400 million by 2010. It is starting from a low base. We want it to go a little further, but its statement at the Bonn conference was positive.
    Hywel Williams: Does the Minister agree that it would be beneficial for developing countries to take advantage of developments at centres of excellence such as the Centre for Alternative Technology at Machynlleth in Wales? What are the Government doing to assist that?
    Mr. Thomas: I have visited the excellent centre to which my hon. Friend referred and, after questions, I will reflect on the opportunities for developing countries to take advantage of such expertise.

  The Prime Minister was asked—
  PRIME MINISTER

    Engagements
    Ql. [183733] Tony Wright: If he will list his official engagements for Wednesday 14 July.
    The Prime Minister (Mr. Tony Blair): This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I will have further such meetings later today.
    Tony Wright: Amidst all the Prime Minister's preoccupations today, could I ask him about the elections? In just four months' time, the people of the United States may well elect a new Administration. Will he stand shoulder to shoulder with a new American Administration on climate change, the middle east and renewing the coalition against terror?
    The Prime Minister: I will always make sure that this country remains a strong ally of the United States of America. As I said at the last Prime Minister's questions, it is not wise for me to intrude on the American elections, but I shall simply say to my hon. Friend that the alliance with the United States of America, however criticised from time to time, is a bedrock of this country's security. We should support it and be proud of it. In particular, I am proud of the part that we have played in sustaining it over the past few years.
    Mr. Michael Howard: Last weekend, the Health Secretary described hospital cleanliness as a new challenge, but in the Government's last NHS plan four years ago, they promised to tackle exactly the same problem. How have they done on the MRSA—methicillin-resistant Staphylococcus aureus—super–bug since then?
    The Prime Minister: As the Health Secretary accepted, it is indeed a serious problem, which we have been tackling and must continue to tackle, as the National Audit Office report makes clear. I shall. however, read out one or two figures, as there has been discussion of our rate of infection and how much worse is it is than that in other European countries. In fact, the rate of hospital-acquired infection is 9 per cent. in England, compared with 7 per cent. in the Netherlands, 8 per cent. in Spain and Denmark, and between 6 and 10 per cent. in France. It is a serious problem, but we are not the only country to have it, and we are working very hard to eradicate it.
    Mr. Howard: I do not think that those figures will give much comfort to people suffering from those infections or the families of the 5,000 people a year who die from them. Since the Government took office, the number of deaths from the MRSA super-bug has doubled, and today the NAO states that four years after its original report on the subject, the NHS still does not even have
    "a proper grasp of the extent and cost of hospital-acquired infection".
    Why not?
    The Prime Minister: The right hon. and learned Gentleman should acknowledge that in fact the NAO says that there has been significant progress in dealing with the issue, but he is right that we still have a great deal to do to get proper information. I would point out, however, that until we came to office, there was no mandatory reporting at all. Indeed, it was introduced by the Government three years ago, precisely because we recognised that that was a problem. With respect, that

    1401
    is why we should treat with a great deal of caution the comparisons that the right hon. and learned Gentleman made with 1997.
    Mr. Howard: Perhaps the Prime Minister will treat with less caution something that the NHS chief executive admitted this morning—Government targets have made dealing with the super-bug "more difficult". Does he accept that Government policy has actually made matters worse?
    The Prime Minister: No, I do not, but I accept that we need to make sure that we have the proper capacity in our NHS, because the higher the level of capacity, the easier it is to have isolation wards and so on. The Government are increasing that capacity in the NHS, and the Opposition voted against every penny of that extra investment.
    Linda Gilroy: I hope the Prime Minister would agree that a community safety partnership—a crime and disorder reduction partnership—that has delivered a reduction of more than 50 per cent. in vehicle crime and a reduction of more than 70 per cent. in domestic burglary since it was set up deserves to be congratulated. Does he also welcome, as I do, the fact that there have been days in Plymouth recently when there have been no domestic burglaries—in a city of 250,000 people? Will he go on with our right hon. Friends the Chancellor and the Home Secretary to ensure that the resources and the appropriate targets to deliver that can continue?
    The Prime Minister: I am delighted with that good news from Plymouth, though we must be careful to state that we do not encourage criminals. It is important to recognise that there have been substantial falls in burglary. The crime rate is, however, still too high and although it has come down, we need to see it come down further. I am sure my hon. Friend is right to say that the combination of record numbers of police, now to be joined by community support officers, plus the changes in the criminal justice system, and in particular the measures in relation to the mandatory drug testing of people when they are arrested for certain categories of offence and the action on antisocial behaviour, are a very important part of cracking down on crime. That is why I am so sorry that the Liberal Democrats opposed all those measures in Parliament.
    Mr. Charles Kennedy: I thank the Prime Minister for that characteristic welcome. Returning to the National Audit Office report, what does he say to its finding that 50 per cent. of health service trusts said that they find the Government's drive to meet performance targets inconsistent with infection control? Does he accept that finding from the NAO on behalf of the trusts?
    The Prime Minister: I accept that as we try to get more people treated and get people treated faster in the national health service that puts pressure on the system. But as I said to the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), in my view it is important that we have performance targets for hospitals. It is important that we make sure that we are
    1402
    bringing down waiting lists and waiting times, as we are. We have said that MRSA is a serious problem and we are committed to tackling it, but let that not obliterate the huge progress that is now being made by NHS staff in the national health service.
    Mr. Kennedy: It is significant that the Prime Minister has said that he accepts what the trusts are saying—that his targets are skewing their ability to deal with infection control. Why does it take seven years of a Labour Government and the problem getting worse and worse for the governmental response at the weekend to be simply to set yet another target? Surely cleanliness in our hospitals should not be a target: it should be taken as read by the patients when they enter the front door.
    The Prime Minister: We are not saying that the answer is simply to set another target. We are taking action to try and make sure that the rate of infection is reduced. We must be careful that we do not misunderstand the position in that regard. We are taking action. The problem is serious, but it will not be made any better by extending the length of waiting times and waiting lists. We are expanding capacity in the national health service and making reforms. When we speak of MRSA, let me remind the right hon. Gentleman that the NHS treats about 1 million people every 36 hours. The vast majority of those people are treated excellently within the NHS.
    Dr. Howard Stoate: I have recently seen two patients whom I suspected of having cancer, both of whom have been seen, investigated and had planned treatment within one week of my decision to refer them. That is a target that my patients are extremely grateful to have. The huge improvement in the health service will be sustained only if the Government continue to put in the resources that we need for meaningful reform. Can my right hon. Friend say how we can sustain the improvement to make sure that performance gets even better?
    The Prime Minister: We will pursue the reforms inside the national health service. The other important aspect is that we make sure that every single penny piece of the money going into the NHS stays with the NHS. We do not want to see a large subvention to those using private health care, which takes that money out of the national health service.
    Mr. Howard: Can the Prime Minister tell us what assumptions his Chancellor has made about increases in council tax over the next three years?
    The Prime Minister: There are no predictions on council tax, because the figure is an average of the past five years' figures. Last year, the actual amount catered for in the spending review did not result in the expected council tax rise. This year's council tax rise is less than 5 per cent. in Labour areas, more than 5 per cent. in

    1403
    Conservative areas and more than 6 per cent. in Liberal Democrat areas.
    Mr. Howard: I am sorry that the Chancellor is not here to make sure that the Prime Minister is a bit better informed—he is probably still trying to decide whether to come and support the Prime Minister during the statement in an hour's time. Let me tell the Prime Minister the answer: the Chancellor is counting on council tax going up by 18 per cent.—almost one fifth—over the next three years, which, to take two councils entirely at random, would add £135 to the typical band A bill in Birmingham and £140 to the typical bill in Leicester. Last year, the Minister for Local and Regional Government said that council tax was very near "the limit of acceptability ", so why is the Chancellor planning those further huge increases?
    The Prime Minister: He is not, for the very reason that I have just given.
    On the basis discussed by the right hon. and learned Gentleman, we should have had council tax rises of more than 8 per cent. last year, but the average was less than 6 per cent., for the precise reason that I have just given him. Average council tax rises are, of course, lower in Labour areas than in Conservative areas. The other interesting point concerns the right hon. and learned Gentleman's shadow Chancellor. [HON. MEMBERS: "Where is he?"] Perhaps the Chancellor and the shadow Chancellor are having a conversation together. His shadow Chancellor said that he would freeze the local government budget in cash terms. [Interruption.] There is no point in the right hon. arid learned Gentleman shaking his head, because that is what the shadow Chancellor said. That freeze would result in a cut of £4.8 billion to the local government budget. What would that do to council tax?
    Mr. Howard: It is interesting that the Prime Minister wants to trade council tax increases in Labour-controlled councils and Conservative-controlled councils, because the highest rate of council tax in the whole country is in Sedgefield, which has a Labour district council, a Labour county council and him as its Member of Parliament. Since he came to office, that council tax has increased by 70 per cent.—three times the rate of inflation. That is a rise of almost £500 for a band D household. The Prime Minister told people that there would be no excessive council tax rises under Labour. Is that not yet another example of his saying one thing and doing another?
    The Prime Minister: The right hon. and learned Gentleman is wrong—the average council tax in Sedgefield is way below the highest in the country. Furthermore, the Conservatives keep using the band that includes only 10 per cent. of the properties in Sedgefield—90 per cent. of the properties are not in the band to which he is referring. It is typical of the Tories always to focus on 10 per cent., not 90 per cent.
    In respect of council tax, it is true that there have been rises that we found unacceptable, which is why we took action and got them down this year. We have been increasing the money that we give to local government, which can use it on services. We have not had an answer to this question: if, as the right hon. and learned
    1404
    Gentleman says, council tax is too high, how on earth would cutting the budget to local government make it lower? It would make it higher, and I should have thought that even he could understand those mathematics, which will certainly be understood by people in Birmingham and Leicester.
    Jeremy Corbyn: Will the Prime Minister turn his attention to the plight of the Chagos islanders, who were prevented from returning to their islands by an Order in Council on 10 June, which cannot be debated in this House, having won their right legally to return in 2000? Will he accept that there has been huge American pressure to depopulate those islands and prevent the islanders from returning? Will he meet the islanders and the Government of Mauritius, and allow the gross injustice of the 1970s to be reversed and the islanders to go home?
    The Prime Minister: I know that this was discussed yesterday in Foreign Office questions, and my hon. Friend will be aware of the statement on the issue made by the Foreign Secretary. The position of Diego Garcia as a base—that is what this is about—is extremely important for this country, as it represents an important part of our security. I understand the concerns that my hon. Friend raises, but the Foreign Secretary dealt with them comprehensively in his statement.
    Mr. Nick Hawkins: Before the local and European elections, Conservative Members, the independent Electoral Reform Society, and the Electoral Commission, which his own Government set up, all warned that there would be fraud and chaos in the all-postal pilot areas. There have been yet more allegations of serious fraud in the current by-elections. Will the Prime Minister now abandon the Deputy Prime Minister's obsession with all-postal voting before the daft regional referendums?
    The Prime Minister: I do not agree with the hon. Gentleman. The Electoral Commission is looking into the issue, and we will study its report carefully. It has the right people to produce an objective and independent report on the matter. There is a lot of evidence that postal ballots increase turnout; I should have thought that that would be welcomed in this House.
    Mr. John Denham: Does my right hon. Friend agree that a just and lasting peace in the Israel-Palestine conflict is essential not only in its own right, but in terms of undermining any international support for terrorism? In the light of last week's condemnation of the Israeli wall by the International Court of Justice, and the damage that the construction of that wall will inevitably do to the chances of a proper peace, can my right hon. Friend tell the House what further steps the Government will take to ensure that the Israeli Government engage constructively in a solution to this crisis?
    The Prime Minister: We have pressed the Israeli Government on several occasions to re-route the fence away from occupied territory, and we have expressed our grave concerns about the humanitarian suffering of the Palestinian people. I agree, however, that the key to

    1405
    many of the problems in the middle east is to get a negotiated settlement between the Israelis and the Palestinians, leading to the two-state solution—an Israel confident of its security and a viable Palestinian state. I assure my right hon. Friend that we will do everything that we can to make progress on the issue. I hope that as a result of the work that is being done over the next few weeks by the Quartet—the US, Russia, the EU and the UN—we will have something positive to say in this respect when we reconvene in September. I entirely agree that there is no more important issue in reducing some of the tensions in the world.
    Mr. Paul Tyler: Has the Prime Minister seen the research report in the British Medical Journal that shows a causal connection between British troops' service in the Gulf and infertility problems? Will he now insist that appropriate Ministers give evidence to the independent inquiry under Lord Lloyd, so that the appearance of secrecy surrounding this issue is dispelled once and for all?
    The Prime Minister: I am afraid that I have nothing to add to what Ministers have already said on the subject. Of course, it is a serious issue, and we investigate it continually. I will discuss with my colleagues the issue of giving evidence. It is important that we make progress on the basis of the actual evidence.
    Mr. Eric Illsley: My right hon. Friend will be aware of the recently published annual report of the Healthcare Commission, which expressed concern at the continued underfunding of those NHS trusts that have the greatest need. My right hon. Friend knows that this Government have funded the NHS to record levels, but will he take the opportunity of the comprehensive spending review to end once and for all the inequality in health funding that has blighted constituencies such as mine?
    The Prime Minister: I entirely understand my hon. Friend's point. As he was gracious enough to say, we have massively increased the amount of investment that is going into the health service. Indeed, by the end of this spending review, somewhere in the region of three times the amount of money, in cash terms at least, will be going into the national health service compared with a few years ago. We are trying to ensure that we deal specifically with health inequalities, and that will be part of what the Health Secretary announces later in the year. Such inequalities do not always arise because some trusts are being unfairly treated—they sometimes arise because people in a particular trust area have severe problems. The Health Secretary is looking into that, and I hope that we can give my hon. Friend some solace later in the year.
    Mr. Richard Spring: Is the Prime Minister aware of a breakdown in part of the planning process on the siting of base stations and transmission masts? Is he aware that, in practice, there is no effective local planning control and that the operating companies' code of practice is simply not being adhered to? Will he instruct the Deputy Prime Minister to talk urgently to the Local Government Association and
    1406
    other interested parties to resolve the matter, which is of increasing concern throughout the House and to so many of our constituents?
    The Prime Minister: I do not dispute that the hon. Gentleman raises a teal issue for all parties and I am happy to engage in discussions with the Deputy Prime Minister and other colleagues. As I said in answer to a question on a different issue, it is important that we, as representatives of our constituents, are prepared ultimately to abide by what the science tells us about the risks, difficulties and dangers.
    I entirely understand that there is a planning issue, but concerns about planning are often driven by people's worries about the supposed health risk and whether it exists. Both matters should be considered together.
    Mr. Piara S. Khabra: Although I welcome the Government's commitment to providing more nursery places for children, can the Prime Minister confirm that the Government will take seriously the findings of a recent study by the National Institute of Child Health and Human Development, which warns of the dangers of starting nursery education too early and its impact on the child's character?
    The Prime Minister: Common sense tells us that we must have a balance. However, I hope that my hon. Friend accepts that the expansion of child care and nursery education as well as Sure Start have played a huge part, especially in some of the most deprived areas of our country, in giving life chances to children who would otherwise be without them. My hon. Friend and other hon. Members also know that all the evidence shows that investment in a child's early years pays real dividends in later behaviour and developing a sense of responsibility. That helps to create a better society.
    Mr. Elfyn Llwyd: Last week, the Secretary of State for Defence stated that investigations into the deaths last year of the six military policemen at Al Majar al-Kabir are to be transferred to the Iraqi central criminal court. My constituents, the parents of the late Lance-Corporal Tom Keys, are concerned that the court will not proceed with the investigations. Worse still, the Iraqi Prime Minister has said that he is minded to grant amnesties to insurgents. Will the Prime Minister intervene personally to ensure that the investigation proceeds to a fair conclusion, especially since suspects' names are known? Will he make the strongest possible representations to the Iraqi Prime Minister about the unsuitability of granting amnesty to those murderers?
    The Prime Minister: It is our understanding that the Royal Military Police special investigation branch has gathered sufficient evidence on the case for the central criminal court of Iraq to take on and direct the final stages of the investigation. In other words, we have evidence in respect of specific individuals. I shall

    1407
    certainly ensure that we stay closely in touch with what is happening. There has been an exaggeration of the extent of any amnesty to insurgents in Iraq, but I would personally find it unacceptable if those people were pardoned for their appalling crime. I assure the hon. Gentleman that we shall stay closely in touch with him and with the families about the issue.
    Mr. Ben Chapman: In the light of concerns about wind power generation—it is relatively expensive and inefficient; it blights land and seascape, and it damages wildlife and marine life—does my right hon. Friend intend to re-examine the nuclear option, as other countries are doing, if we are to achieve our targets on carbon dioxide and global warming?
    The Prime Minister: My hon. Friend will know that I spoke about this in front of the Liaison Committee the other week. Nuclear power is an important source of carbon-free electricity, but the analysis of the energy White Paper showed that, at present, the economics make new nuclear build unattractive. However, I told the Liaison Committee that we are keeping the nuclear option open and continuing to invest in skills and research, but we would have to overcome both public concern and the cost issue. I entirely understand what my hon. Friend says, and as we move further to develop diversity of energy supply, we will have to keep all these options open.
    Mr. David Atkinson: If the Government have increased funding to local authorities as the Prime Minister has just claimed, why are the schools in Bournemouth and throughout the county of Dorset facing a funding crisis for the second year running that is causing head teachers to make their staff redundant and to appeal to parents to come forward with extra money? Why did the Prime Minister not warn our schools at the last election that they would be facing starvation, starvation, starvation?
    The Prime Minister: I do not know the precise situation in the hon. Gentleman's schools, but I will certainly find out about it in the light of what he says. All schools this year are receiving increases that have been passported through by the Government. They will then be given ring-fenced money directly. Over the last few years under this Government we have increased education funding dramatically. Let me remind the hon. Gentleman that when the Government he supported were in power, in the last few years when his present leader was sitting in the Cabinet, they cut the funding per pupil. We have raised it substantially, and I would be astonished if we had not raised it in his area as well.
    Mr. John Grogan: Given that, in London, our good friend Ken can regulate the buses to determine routes and frequencies, why cannot we do the same in the great northern centres of population such as Liverpool, Manchester, Leeds, York and, in particular, Selby, where Arriva is planning significant cuts in bus services?
    The Prime Minister: I understand my hon. Friend's concern. We introduced limited regulatory powers over
    1408
    bus services for local authorities four years ago, and we are currently consulting on ways of making it easier for the local authorities to use them. I know that my hon. Friend would not want us to forget, however, that it was this Government who guaranteed all over-60s and disabled people in England half-price or better bus fares on their local buses, and who in 2003 extended that provision to cover long-distance coaches. I entirely agree that there is an issue in relation to regulation, but bus use has recently gone up in this country for the first time in many years.
    Mr. Roger Gale: Does the Prime Minister now regret his condemnation of the democratically taken decision by the people of the republic of Cyprus to reject Annan V? Will he give the House a clear undertaking that his Government will not support any measures in the European Union that would lead to a tacit recognition of the illegal regime in the northern part of the island?
    The Prime Minister: I am afraid that I do not regret what I said then. I still believe that it would have been better if Kofi Annan's plan had proceeded; it was a fair settlement. I also think that, although we made it clear that Cyprus's accession to the European Union could not be dependent on unification of the island, it would obviously be better if some process leading to a settlement between the two parts of the island took place. We will continue to work for that—of course we will—but I thought that Kofi Annan's plan was well judged, and I hope that we can return to this issue and get it properly negotiated. There may be some changes to it, I do not know, but the basis of the plan was a sound one.
    Mr. Kelvin Hopkins: My right hon. Friend will be aware that the private finance initiative contractor, Jarvis, has been teetering on the brink of bankruptcy for weeks now. This is putting at risk a large number of school repair schemes and other public sector works. Would he not think it sensible, given that Jarvis's share price has now collapsed to junk levels, to buy out all those public sector schemes, get them done in the public sector, and save billions of pounds of public money?
    The Prime Minister: No, I am not sure that I would say that to my hon. Friend. [HON. MEMBERS: "Think about it!"] I am not even going to say that I am going to think about it. Obviously, there are issues that need to be sorted out in relation to the Jarvis contracts. However, let us never forget that PFI has delivered enormous benefits in terms of infrastructure building in our constituencies and communities. I know from my own constituency that there are schools and hospitals that would not have been built without it.
    Mr. Nigel Evans: On Monday, I met two of my constituents in Alma place in Clitheroe. The wife is disabled. Normally, she travelled to her local post office in Henthorn road in her wheelchair, and she enjoyed doing that. On Monday, we travelled in a vehicle past the post office, which is now closed, to another post office in the centre of Clitheroe, which is on a hill. We had to park some way away from it, then get

    1409
    out of the vehicle and travel up to the post office. Does the Prime Minister realise that his policy of closing post offices is causing such a deterioration in the quality of life of so many disabled people?
    The Prime Minister: As the hon. Gentleman must know, post office closures also proceeded under the previous Government, to the tune of several thousand. There is not a policy of post office closures, but as post offices undergo a tremendous amount of change, as
    1410
    fewer people collect their benefits from the post office, the Government must give an additional subsidy to post offices. Over the next few years, they will receive a subsidy of £1 billion. We are doing what we can, but we cannot simply put endless sums of money into post offices that are not commercially viable. That is why it is not fair to say that it is the Government's policy to close post offices. We are doing our best to keep as many of them open as possible. The only way of keeping more open is to spend even more money, to which he is opposed.

Regional Assemblies' Referendums (Voting Arrangements)
12.30 pm
Charles Hendry: I beg to move,
That leave be given to bring in a Bill to make provision about the voting arrangements for regional assemblies' referendums.
I cannot recall a day when there has been greater media and public interest in what is going on in this House, and I am sure that I am not alone in realising that that is because people understand the importance of the issues contained in this Bill.
I am introducing this Bill because the experiments with all-postal voting in the elections in June did not give people the confidence that genuine free and fair elections demand. The Government have made it clear that they want to hold all-postal referendums for the regional assemblies, but I believe that before we continue down that path, the House must be given the opportunity to debate how those referendums should be held.
There is a real concern that the Government are only pressing ahead with all-postal voting in the regional assemblies referendums to ensure that there is not a derisory level of voting, partly, at least, because people are simply not persuaded by the case in favour of those assemblies. The Government's concern is that a poor turnout would deprive the proposed assemblies of their democratic legitimacy. In that, they are undoubtedly right, but the solution must therefore lie in the nature of the proposed assemblies, not in the nature of the electoral system.
The report by the Electoral Commission on the experiment with all-postal elections will be published in September, and I am glad that the Government have conceded that they will at least not go ahead with all-postal referendums if the commission concludes that they are unsafe. But there are fundamental reasons why we should decide now not to go down the route of all-postal ballots.
A few minutes ago, the Prime Minister spoke of the increase in turnout in the European elections. The turnout did indeed rise, but only marginally more in those areas in which there was universal postal voting than in areas in which traditional voting methods were used. Other factors that may have influenced turnout, such as a particular dislike of the EU constitution, were ignored.
First, there are logistical issues. The recent European elections have highlighted the fact that there are serious logistical issues that need to be addressed before we even consider more all-postal ballots. In Bolton, 6,000 ballot papers were never delivered, which resulted in emergency polling booths being opened. In Gateshead, boxes were placed in 18 libraries due to the late delivery of ballot papers: nearly 600,000 packs in Tyneside were delivered late. In Cheshire, in Vale Royal, a polling station had to be opened, as more than 700 electors did not receive packs. In Wigan, more than 1,000 voters had to go to the town hall to get their packs due to a breakdown in the delivery system. In Kingston upon Hull, a group of independent councillors are taking legal advice after many homes did not, receive ballot papers and the United Kingdom Independence party won that seat by only seven votes.
1412
Those issues have not yet been resolved, and the postal voting experiment should not be extended until we can be certain that such problems would not arise again. We cannot have that certainty in time for the regional assemblies referendums this November. If we are to go down the route of universal postal voting, safeguards need to be introduced to ensure that 100 per cent. of eligible voters receive one, and only one, ballot paper. As the Office of the Deputy Prime Minister: Housing, Planning and Local Government Committee has called for, there should be a requirement for Postcomm, the postal services regulator, to assess and set targets for 100 per cent. secure and accurate delivery of postal ballot papers.
We should, however, be worried about not just the logistical failures but the scope for fraud. Universal postal voting needs much stronger checks and balances if fraud is to be prevented. As the ODPM Committee's report suggests, there should be individual electoral registration; but again, we all know that that is not possible before the referendums to be held this autumn. The police should have additional powers of search and arrest to investigate claims of fraud, and there should be a new offence of intending to apply fraudulently for a postal or proxy vote.
Implementation of the Committee's recommendations would reduce the possibility of fraud. They need to be implemented immediately to maintain the integrity of elections, and the belief among the electorate that elections are genuinely free and fair. Without them, universal postal voting will continue to be subjected to widespread abuse and fraud.
The Government have dismissed claims of any widespread election fraud, but the evidence suggests otherwise. We should look at some of the examples of alleged fraud in the most recent elections. In Bradford, the city council has confirmed that 12 separate allegations to the police concerning undue influence and electoral irregularities are being investigated. In Burnley, Lancashire police are questioning 60 people about more than 100 suspicious postal vote applications. In Liverpool, a postman was mugged for ballot papers. The Manchester Evening News reported that the Greater Manchester police were snowed under with allegations of electoral fraud. In Oldham, a Liberal Democrat candidate was arrested on suspicion of stealing postal papers. Sadly, none of the Liberal Democrats are present to hear that. In Birmingham there were widespread allegations of fraud, although Birmingham was not a trial area.
The hon. Member for Birmingham, Sparkbrook and Small Heath (Mr. Godsiff)—who, I am pleased to say, is a sponsor of the Bill—spoke eloquently about the situation in Birmingham in his recent speech during a debate on the electoral system. He spoke of people being bullied to vote one way or another. He spoke of bribes being offered for ballot papers: a postman was offered £500 for a sack of them. He spoke of a councillor sorting through ballot papers in a back-street car park at midnight. Even Albert Bore, until June the Labour leader of Birmingham city council, said:
"At present, in relation to the handling of postal ballot papers, the law is so general that almost anything is legal".

1413
Even he called for a rethink of postal voting after a candidate was found with a bag of completed ballot papers.
Mr. Henry Bellingham: Another Liberal Democrat.
Charles Hendry: Further evidence of the abuse has been highlighted during the current campaigning in Leicester, South. A Liberal Democrat canvasser—
Mr. Bellingham: Yes.
Charles Hendry: A Liberal Democrat canvasser targeted a home for people with learning disabilities.
Mr. Bellingham: Another Liberal Democrat
Charles Hendry: According to The Mail on Sunday, he bullied the owners of the care home, Mr. and Mrs. Tweddle, to try to gain access to residents.
Mr. Bellingham: Disgraceful.
Charles Hendry: The canvasser also claimed that the care home owners could vote on behalf of their residents as their appointee, which is untrue. Mr. and Mrs. Tweddle say that his use of the correct jargon made them fear that he had received formal training before approaching their care home to persuade them to use their residents' postal votes.
Mr. Bellingham: Liberal Democrat training.
Charles Hendry: We all know that under common law, people with mental disabilities are unable to vote if on polling day they are incapable of making a reasoned judgment, but universal postal voting removes that safeguard, and leaves people with learning disabilities open to abuse.
Mr. Bellingham: By the Liberal Democrats.
Charles Hendry: The integrity of the vote is further undermined by electoral registers not being accurate. Following a recent initiative to clean up the electoral register, the number of people on the register in Portsmouth, South dropped by 14.5 per cent. In Edinburgh, South it dropped by 11 per cent. and in
1414
Brent by 12 per cent. Only limited proof is required for someone to get on to the register. The Daily Mail registered Mr. Gus Troobev—an anagram of "bogus voter" on 31 registers within a few hours. A Sunday Telegraph journalist had the ballot papers of 36 voters sent to the same address. We also know that people's names can often stay on the register long after they have left or died. That is why, to make registers more accurate, there should be individual registration, with positive identification rather than head-of-household registration. Until the register is cleaned up, postal voting will only increase people's opportunities to vote fraudulently.
The House should consider the wider democratic implications of all-postal voting, which are as important as the integrity of the voting system. Most people return their postal votes soon after they receive them, so they cannot take account of the full facts and issues in the whole election campaign. That changes the results in a way that none of us would consider democratically correct. In the forthcoming referendums, it is essential that the electorate hear all the arguments and make an informed decision, rather than being encouraged to vote before being made aware of the full implications of setting up the regional assemblies.
These changes are essentially undemocratic and give an unfair advantage to the Government of the day, who control the timetable and much of the agenda in a campaign. The Government have chosen the dates for the referendums according to when they think they have the best chance of winning them. The all-postal system reduces the opportunity to convince the electorate of the problems associated with regional assemblies and the arguments against them.
The Bill has cross-party support and I urge the House to support it, to ensure, that the voting process, which is central to our democracy, is not changed without proper consultation and consideration by this House.
Question put and agreed to.
Bill ordered to be brought in by Charles Hendry. Mr. Graham Brady, Mr. Nigel Evans, Mr. Frank Field, Mr. Roger Godsiff, Mr. Stephen O'Brien, Mr. George Osborne, Mr. Graham Stringer, Miss Anne McIntosh and Mr. Tim Collins.

REGIONAL ASSEMBLIES' REFERENDUMS (VOTING ARRANGEMENTS)
Charles Hendry accordingly presented a Bill to make provision about the voting arrangements for regional assemblies' referendums: And the same was read the First time; and ordered to be read a Second time on Friday 15 October, and to be printed [Bill 140].
Orders of the Day

  Patents Bill [Lords]
  [Relevant documents: The Second Report of the Regulatory Reform Committee, Session 2003–04, on the proposal for the Regulatory Reform (Patents) Order 2004, HC 337, and the Eighth Report of the Committee, Session 2003–04, on the draft Regulatory Reform (Patents) Order 2004, HC 683.]
  As amended in the Standing Committee, considered.

  Patents Bill [Lords]
    New Clause 1

      COSTS AND EXPENSES IN INFRINGEMENT PROCEEDINGS ETC
      1. Section 106 of the 1977 Act (costs and expenses in proceedings before the Court under s.40) is amended as follows.

      2. In subsection (1) (relevance of parties' financial position), for the words from "proceedings" to "the court)" there is substituted "proceedings to which this section applies".

      3. After that subsection there is inserted—

      "(1A) This section applies to proceedings before the court (including proceedings on an appeal to the court) which are—

      (a) proceedings under section 40;

      (b) proceedings for infringement;

      (c) proceedings under section 70; or

      (d) proceedings on an application for a declaration or declarator under section 71."

      4. This section applies in relation to proceedings commenced on or after the commencement of this section.'—[Mr. Sutcliffe.]

      Brought up, and read the First time.
      12.41 pm
      The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Gerry Sutcliffe): I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Sir Alan Haselhurst): With this it will be convenient to discuss Government amendment No. 2.
      Mr. Sutcliffe: The intention behind the new clause and the amendment is to make a small additional improvement to the framework for enforcement of patent rights. We listened very carefully to the debate in Committee, and following further consideration I have identified one more improvement to the enforcement framework that could assist small and medium-sized enterprises in some circumstances I believe it appropriate for this provision on costs to be added to the Bill.
      It might help if I begin by exploring some of the background that is relevant to the enforcement framework in general, and to the new clause and amendment in particular. Members will be aware that in Committee, we discussed a number of possible modifications relating to enforcement of patent rights. I know that we are all keen to have a framework for enforcement of rights that is accessible to all. The difficulty, however, is delivering a framework that is accessible to an SME patent holder, but which is also fair to a party against whom enforcement action may be taken. In this respect, it is important to remember that the other party may be another SME.
      1416
      Moreover, patent disputes can involve—indeed, they probably often do involve—difficult technical and legal arguments, so the framework cannot favour a patent holder over another party. The other party may have perfectly valid arguments as to why there is no patent infringement, or why the patent is not in fact valid; that would mean that there is nothing that can be infringed.
      Finding acceptable and workable ways that will really address the concerns raised in Committee is not easy, therefore. We explored various possibilities during the consultation process before the Bill was introduced. but some of them were not widely supported. Others received greater support, and we have pursued and developed them and made suitable provision in the Bill. We hope that the amendments and improvements to patent law that are relevant to the enforcement framework will provide some assistance on certain occasions.
      I know that there could be some disagreement as to how useful the Bill's provisions might prove to be. However, I hope that the very full debates that we have had so far will help people to understand our reasons for including them, and how they might help. I accept that the provisions provide only some pieces of the jigsaw that is necessary to improve the enforcement framework. As I said, during our earlier deliberations Members proposed alternative or additional provisions. In addition, the noble Lords in the other place have also tabled some amendments with a view to improving the enforcement framework. Many of the amendments were inspired by the desire to address the enforcement concerns of small and medium-sized enterprises, with which we also sympathise. Unfortunately, most of the amendments would not, in our view, work as intended or deliver a system that is fair to all. I did promise in Committee, however, that we would continue to consult and consider whether any further adjustments to patent law to help SMEs in patent disputes might be possible in the Bill.
      Since consideration of the Bill in Committee, we have consulted a number of stakeholders. My officials met the patent reform group, which was mentioned by some hon. Members in Committee. We also contacted several other individuals and groups, and the outcome of the consultation clearly showed the difficulty of finding a consensus on what more could be done to help SMEs. There has certainly been no widespread support for any of the proposals that were debated in Committee. Furthermore, it has not been possible to identify any additional provisions that could be added to the Bill that command support from all stakeholders.
      The difficulty of finding a workable and fair way of modifying the enforcement framework is perhaps not surprising. Indeed, the issue of patent enforcement is one of the issues that the Intellectual Property Advisory Committee has explored. That independent committee, which generally chooses its own work programme, decided to investigate the perceived and actual problems associated with the enforcement of patent rights. The Committee was particularly concerned about the costs when a patent dispute goes to court and believed that those costs might compare unfavourably with costs in other jurisdictions.
      It is perhaps regrettable that the Intellectual Property Advisory Committee was unable to report on the issue of enforcement of patent rights until November 2003.

      1417
      By that time, following a public consultation that I have already mentioned, we were already well advanced in formulating and developing the contents of the Patents Bill. That consultation was conducted a year earlier, over the winter of 2002–03. Indeed, the Government's intentions for the Patents Bill were published a little before the Committee produced its position paper. Nevertheless, we found the Committee's report extremely useful in helping us to assess again whether the provisions in the Bill were right and whether more might be done.
      We have carefully considered the recommendations made by the Intellectual Property Advisory Committee. Its recommendations on re-examination were helpful and our discussions with some members of the Committee informed our development of the Bill's provisions on non-binding opinions. The Committee also identified the useful development of the new streamlined procedure by the patents county court and the need to make sure that it is actively promoted. We are very happy to endorse that and we will be monitoring developments at the patents county court to see that that and other reforms make a difference.
      It is interesting to note that the Intellectual Property Advisory Committee has not proposed provisions of the sort that would have been provided by various amendments that we considered in Committee. That perhaps illustrates again how difficult it is to identify measures that would have a wide degree of support and would actually work to give the desired result—that is, to help SMEs in trying to enforce their patent rights while being fair to all.
      There have been some calls for a general review of the patent system and enforcement of patent rights in order to find a consensus for a way forward. Those calls have, I believe, generally come from people who have already dismissed the enforcement provisions in the Bill as insufficient or irrelevant. The additional amendments that we have identified and propose today have not, I understand, made any difference to those calls for a wide-ranging review. Not everyone to whom we have spoken in the past few weeks agrees that the proposed amendments on costs are worth making.
      I am not so pessimistic, but we are not saying that what is in the Bill, either with or without the additional amendments, is a sufficient and complete answer to concerns about enforcement. Recent developments at the patents county court—I have already said that we shall follow them closely—are also important, and our continued exploration of the patent enforcement project is another useful work stream. Those examples demonstrate our continued commitment actively to engage with the enforcement agenda. Given the various strands of activity that are already under way, which may collectively deliver appreciable improvements to the enforcement environment, we do not believe that it would make sense to undertake a more general review now.
      I would like to assure hon. Members again that we have listened to the concerns raised during debates on the Bill, and that we have explored with a number of people over the past few weeks whether anything more could usefully be added to the Bill to deliver further legislative change at this point in time.
      1418
      I have already mentioned that the Intellectual Property Advisory Committee pointed out that the costs of litigation in the UK courts are a serious problem for those with limited means. That concern has partly inspired our further consideration of the enforcement framework. I am very pleased that we have been able to identify a further small amendment to the Patents Act 1977 in the past few weeks, specifically on the issue of costs of litigation before the courts.
      The new clause and the amendment will, we hope, help SMEs in appropriate circumstances where they face litigation in the courts. However, we hope that the messages delivered by this amendment will also support the desire, which many of us share, to encourage parties to settle cases more cheaply by negotiation and mediation rather then litigation.
      In more detail, the new clause will amend section 106 of the Patents Act 1977 to allow the courts to take into account the financial position of the parties as one of the factors when deciding on costs in different types of patent dispute. Section 106(1) currently states that
      "the court, in determining whether to award costs or expenses to any party and what costs or expenses to award, shall have regard to all relevant circumstances, including the financial position of the parties".
      However, this applies only to proceedings brought before the court under section 40 of the 1977 Act. As some of us may recall from our earlier consideration of clause 10 of the Bill, section 40 deals with employee compensation and, in particular, with compensation for an employee who has made an invention that belongs to his employer, the patent for which has proved to be of outstanding benefit.
      The new clause would amend the current section 106(1) and insert a new section 106(1A) to extend the range of patent disputes in which regard must be had to
      "all the relevant circumstances, including the financial position of the parties"
      before the court makes an award of costs. Section 106(1) includes disputes concerning infringement, threats of infringement proceedings under section 70 and declarations of non-infringement under section 71, in addition to those concerning compensation for employees under section 40.
      Government amendment No. 2 makes a consequential amendment to remove the specific reference to section 40 from the title of the section, as the new provision will no longer be limited to court proceedings under section 40. Thus, this new power would apply to all disputes where a decision has to be made regarding infringement. For example, when deciding a case concerning a groundless threat of infringement proceedings under section 70, it is first necessary for the court to determine whether any infringement has taken place. Similarly, in proceedings under section 71, the courts are asked to confirm that infringement did not, or would not, occur. However, the provision would perhaps be of most use to a patent holder who is an SME bringing proceedings for an infringement.
      Of course, where a patent holder has commenced infringement proceedings against another party, it is common for that other party to raise concerns about the validity of the patent holder's patent. As well as deciding whether a particular activity falls within the scope of the

      1419
      patent claims, and so infringes the patent, the court is therefore often also determining in the same proceedings whether the patent is valid. As long as infringement is one of the issues being determined in the proceedings, the new provision on costs would apply. That is, the court will take into account the financial position of the parties with regard to an award of costs for the proceedings as a whole, even if a significant—or even the most significant—part of the proceedings concerns issues other than infringement, such as the validity of the patent.
      The wording of the amendment makes it clear that "all the relevant circumstances" have to be taken into account, and that the
      "financial position of the parties"
      is only one of the relevant circumstances that must be taken into account.
      Malcolm Bruce: I understand that the Minister is describing how costs might be apportioned at the end of proceedings, but is not part of the problem the fact that large companies effectively can prevent small companies from completing the action and getting to the costs stage? Is there anything in the amendment that supplies balance to the situation? In many cases, small businesses will say that they cannot afford to contest or defend their patent, because of the costs that their opponents can afford.
      Mr. Sutcliffe: I acknowledge the point that the hon. Gentleman makes, and the amendment is an attempt to supply the balance that he seeks. I am perfectly willing to listen to what hon. Members have to say about what we are trying to achieve. I recognise that these are difficult matters, for the reasons that I set out earlier. We want to arrive at general agreement between all the stakeholders involved.
      The amendment will not prevent other relevant circumstances from being taken into account. Accordingly, it is fully consistent with the existing duty of the courts, under the civil procedure rules, which requires them to have regard to "all the circumstances" in making orders about costs.
      According to section 130(1) of the Patents Act 1977 and section 62(1) of the Supreme Court Act 1981, the courts in England and Wales that deal with patent disputes are that part of the chancery division of the High Court that is known as the patents court, and the patents county court. In Scotland, the Court of Session deals with patents, and in Northern Ireland the responsibility lies with the High Court. In each of the three different civil jurisdictions, the courts have the power to take into account a number of factors when deciding on the issue of costs.
      For example, in England and Wales, the civil procedure rules lay down the rules for all civil litigation in the High Court or a county court. Hence, they apply equally to patent disputes, which are a form of civil litigation, whether they take place in the patents court or in the patents county court. Thus, the proposed amendment to section 106(1) of the 1977 Act must be consistent with the general rules on costs laid down in the civil procedure rules.
      The main principle behind those rules is that the court must take into account all the relevant circumstances when deciding whether to award any costs and, if so,
      1420
      what amount of costs. For example, the court can take into account the behaviour of the parties concerned in conducting the litigation, and whether it was reasonable to pursue particular allegations. That can then be reflected in the extent of the costs award.
      The proposed amendment to section 106 makes it clear that, in certain patent disputes, the court must have regard to the financial position of the parties in addition to all the other factors that it takes into account when deciding on costs. That is a factor that the court may already regard as relevant in some circumstances. As a result of this amendment, however, it will always be deemed to be a relevant factor.
      Accordingly, the amendment offers those embarking on a patent dispute an assurance that that will be one of the factors that the court will consider. Parties will know in advance that there is a statutory obligation on the court to take both parties' financial position into account when awarding costs, and so both parties are able to consider what that might mean for them. That, in turn, might influence how they deal with a patent dispute.
      The amendment will not alter the fact that the losing party will in any event normally have to meet its own costs, such as the costs of its legal advisers. Its main impact will be that, if the court thinks it appropriate after considering the relative financial position of the two parties, a less-well-off party may not be ordered to pay all the costs of a better financed party, even if the less-well-off party loses the case. I think that that covers the point raised by the hon. Member for Gordon (Malcolm Bruce).
      However, I stress that the amendment does not mean that a smaller less-well-off party can behave irresponsibly and launch patent infringement cases with impunity, safe in the knowledge that his small financial size means that he would not have to pay the costs of the other party even if he lost. It is true that this amendment means that the financial position of the less-well-off patent holder, relative to that of the alleged infringer whom he is pursuing, will be taken into account when an award of costs is being considered if that patent holder is not successful. However, the financial position is just one of the factors to be considered. The court could decide that the behaviour of this less-well-off party was irresponsible, and that that was also relevant to how costs should be awarded. In such circumstances, the financial position may not be the most important factor. The courts would be entitled, if they considered it appropriate, to make a large costs award against the less-well-off party who has behaved in an irresponsible manner.
      Moreover, even where a less-well-off party has behaved responsibly, but has lost the case, he may still have to pay at least some of the costs of the other party. Therefore, the amendment does not provide SME patent holders with a licence to litigate against wealthier parties without fear of paying any of the other side's costs, whatever the outcome. Yet the SME can be certain that its financial position will be carefully considered, along with other relevant factors, when the court decides how to award costs.
      Perhaps the main value of the amendment will be as a marker or sign. It will encourage parties to take a sensible attitude when considering the prospect of

      1421
      litigation. It acts as a warning to a party that has financial superiority and chooses to run up large costs in a dispute, that it will not necessarily get all those costs back even if it wins. We hope that that will encourage all parties to consider more carefully whether a dispute can be settled more cheaply, perhaps by mediation or voluntary binding arbitration. When appropriate, both parties might agree to infringement proceedings being undertaken at the Patent Office, where costs are likely to be less for all than when the proceedings take place before the courts.
      There may be very good reasons why none of these options is appropriate for a particular case, and the amendment does not in any way preclude a patent dispute from being heard by the patents county court or patents court. Nevertheless, we hope that it will encourage both parties to consider all the options before a case is taken to the courts.
      As I have already indicated, not all of those whom we have consulted about the amendment have supported it. Some have argued that it is irrelevant: as SMEs cannot even afford the expense of taking a case to the courts, it is pointless to make any provision on costs that could help. However, others have supported the amendment and agree that the proposed change would provide a useful signal to SMEs that their financial position can be taken into account by the courts.
      If the amendment also has the effect that I have indicated of encouraging parties to agree to resolve an infringement dispute in a less confrontational and expensive manner, it could have a much wider impact. It could help some SMEs that are not able to afford to bring a case to the courts in the first place, and in that way begin to address the concerns of those who say that it is irrelevant.
      By itself, the amendment may not have much effect. However, given the other changes in the Bill and the other improvements to the enforcement framework I have discussed, I believe that it is worth making. I hope that the House will agree with me, and that we can put in place today another small piece in the jigsaw to improve the enforcement framework for SMEs involved in a patent infringement dispute.
      1 pm
      Mr. James Arbuthnot: The Minister frequently used the word "small", and we heard today how small his ambitions are and how difficult everything is. The purpose of the new clause is to help small and medium-sized enterprises that cannot afford the massive costs of taking patent cases, with all their legal and technical complexities, through the courts. The Minister anticipated my question as to whether the new clause will achieve that.
      1422
      How will the new provisions provide any certainty for small and medium–sized enterprises? When deciding whether to take a case to court, they will still face the risk that the court will not exercise the new discretion and increase an award of costs in their favour. SMEs will not be able to budget in advance for that and will therefore still face the same risks, threats and uncertainties that they face at present.
      My second question is whether the Government will issue guidance to the courts on how to exercise the discretion. What criteria will the courts be expected to use? If nobody knows, how will the provisions help anybody? The new clause amends section 106 of the Patents Act 1977, which relates to section 40 of that Act, so that it applies to several different cases. However, there has never been a successful case under section 40 in the many years of its existence, so there is no current precedent. The third question is how the new clause differs from the current powers of the court. In practice, the courts already take into account the circumstances of the litigants.
      The Minister talked about consultation. What representations were made by those in favour of this change? How many people said that they favoured this change, and who made them say it? I worry about the new clause—not hugely, because it is a tiny Bill—because it is another action designed to reassure, or perhaps confuse, people into thinking that the Government are doing something important to help small businesses. There is little in the new clause. It is so watery that there is little to vote against, but the Minister still has some persuading to do.
      Paul Flynn: The right hon. Member for North-East Hampshire (Mr. Arbuthnot) has not taken a very positive line. The new clause is a genuine attempt to meet the objections from SMEs to the existing situation and what they perceived as deficiencies in the Bill. Certainty is too much to ask in litigation and there will always be some doubt about how legislation will work in practice. It would be generous of the right hon. Gentleman and the House to recognise the good will on the part of the Government that lies behind the new clause.
      The right hon. Gentleman said that this is a small Bill. I assure him that it will be the major news item from this building today for the South Wales Argus, if not the rest of the press, which may be distracted by events of lesser importance. This is the first Patents Bill since 1977 and is a major event for many of my constituents. We should accept that behind the Bill lies a strong warning to SMEs that the worst possible way to attempt to solve a dispute is to go to litigation, which will always be the most expensive and long-winded approach. If the Government were to he more generous, it might encourage people to opt for litigation without trying the procedures that are already available through the Patent Office, where matters can be dealt with speedily.
      Malcolm Bruce: I shall not be quite as churlish as the right hon. Member for North-East Hampshire (Mr. Arbuthnot), although I sympathise with his comments. The Minister said that he would consult further and table amendments if he felt that they would be helpful, and he has done so. However, as I suggested in an earlier intervention, the new clause does not go as far as the amendments I proposed, although it is a welcome gesture.
      The difficulty for many small businesses is that the lack of clarity in the law creates greater uncertainty in litigation, which picks up on a point made by the hon. Member for Newport, West (Paul Flynn). That works to the advantage of the large company against the SME, simply because the larger company can afford to fund litigation and effectively squeeze out the smaller business to the point where it cannot challenge an infringement of patent or otherwise defend its patent. The new clause would be irrelevant in such a case because the company would never reach the stage at which costs were apportioned. Many of us hoped that the Bill would make the law on defence of patents clearer to give a signal to larger companies that using their power in a process of attrition against SMEs would not be tolerated.
      Mr. Sutcliffe: I said that I would look again at the issue and I have tabled the new clause in that spirit. I do not want it to be irrelevant. It is a small step, as the right hon. Member for North-East Hampshire (Mr. Arbuthnot) said, but does the hon. Gentleman think that we would be better off without it?
      Malcolm Bruce: No, I am not saying that and I do not think that anybody will oppose the new clause. I am trying to make the serious point that the new clause may make a genuine contribution to a settled case and the fair apportionment of costs, and that may affect the extent to which companies are prepared to litigate. However, as the right hon. Member for North-East Hampshire pointed out, there would still be uncertainty about the apportionment. The cost of reaching that point might also be too great for an SME to absorb. The new clause is fine as far as it goes, but issues remain unaddressed. I was lobbied very heavily about those issues, and the people who lobbied me will remain disappointed that the Bill has not been able to come up with a legislative framework that would address their concerns. The process of patent protection needs to be made more equal for different sizes of companies.
      I do not wish to repeat the debates we had in Committee, where the arguments were well aired. I welcome the fact that the Minister has been courteous and consistent. He said that he would consult, he has done so and he has come back with a proposal. The problem is that he has consulted with both sides of the argument and therefore has to strike a balance. I welcome the new clause and shall not vote against it, but patent law still contains injustices that the new clause and the Bill have not addressed.
      Mr. Sutcliffe: I appreciate the comments made by right hon. and hon. Members, if not all the points made by the right hon. Member for North-East Hampshire. The new clause is a genuine attempt to resolve a problem
      1424
      that was raised in Committee. Some of the amendments tabled were not workable and would not have delivered what was intended. I accept the point about how large companies operate, but we are trying to change behaviour by giving smaller companies an incentive and warning larger companies that costs could be considerable. We are trying to resolve disputes in the way that my hon. Friend the Member for Newport, West (Paul Flynn) suggested.
      I was not being churlish when I asked whether we would be better off without the new clause. If hon. Members think that it would be pointless, I would be happy to withdraw it. It remains to be seen how it will work, but I think that it will help to change behaviour. We tried to accommodate the concerns of the patent reform group, and hon. Members will recall that it was represented in force watching our deliberations in Committee. We could not consult everybody, and we could not reach agreement on what we were trying to achieve. That is one of the difficulties that I set out and that is why expertise in the excellent Patent Office in my hon. Friend's constituency can be so valuable in resolving disputes. I ask hon. Members to support the new clause, despite their reservations.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.

    Clause 13

      OPINIONS BY PATENT OFFICE AS TO VALIDITY OR INFRINGEMENT
      Mr. Sutcliffe: I beg to move amendment No. 1, in page 8, leave out lines 3 to 5 and insert—

      (6)In relation to a decision of the comptroller whether to issue an opinion under this section—

      for the purposes of section 101 below, only the person making the request under subsection (1) above shall be regarded as a party to a proceeding before the comptroller; and

      no appeal shall lie at the instance of any other person.'

      Hon. Members who attended our debate on clause 13 in Committee will recall that I undertook to reflect further on whether we should make amendments on a right of appeal in relation to opinions. We considered the matter carefully and the amendment relates to a technical point—whether there is a need, in relation to the opinion procedure, to include an exemption to the general right of appeal from all decisions of the comptroller under section 97 of the 1977 Act.
      Our concern is to ensure that no person other than the requester of an opinion can appeal against a decision by the Patent Office as to whether or not to grant the request. That is to ensure that the issuing of an opinion is not subject to unnecessary delay while also safeguarding the requester's right to be heard before a request is refused. That right arises under section 101 of the 1977 Act, which gives a party the right to be heard before a discretion is exercised against him. However, there could be even more serious delays if a person who had no right to be heard on the original decision could none the less exercise a right to appeal the decision to the patents court under section 97. The current wording of the new section 74A(6) may, by implication, already

      1425
      exclude such a right of appeal. However, I am advised that it would be better to put the matter beyond doubt, so I have tabled the amendment to achieve that.
      I commend the amendment to the House.
      Mr. Arbuthnot: The Minister has just proposed an important amendment. I claim no credit for it but give that credit entirely to him, because of the way that he has responded so generously and appropriately to the representations that were made. I congratulate him on a superb amendment and hope that it will be accepted.
      Amendment agreed to.

  Schedule 3

    REPEALS
    Amendment made: No. 2, in page 16, line 28, at end insert—
    'In section 106, in the heading, the words "under s.40".'.—[Mr. Sutcliffe.]
    Order for Third Reading read.
    1.12 pm
    Mr. Sutcliffe: I beg to move, That the Bill be read the Third time.
    I am grateful to hon. Members for their contributions on Report, especially the right hon. Member for North-East Hampshire (Mr. Arbuthnot), who was the architect of the thought pattern behind our second amendment. I thank him for that.
    Our debates on the Bill have been interesting and well argued. On Second Reading, some reservations were expressed about the Bill, but it is fair to say that it was, by and large, welcomed on both sides of the House and I am pleased that hon. Members on both sides of the House have examined it in a constructive and detailed manner, both in Committee and again today. I thank them for that.
    I shall make a few remarks before I commend the Bill to the House. The Government fully understand the importance of giving support to innovative and creative UK businesses. The patents system is one important way in which that support is provided and the Bill will help to ensure that our patents system is robust in its operation, while also being well-balanced and accessible to all. We are committed both to ensuring that protection continues to be available for those businesses that have the creativity and drive to make technical advances that help us all and to improving and modernising the patents system so that it meets the needs of its users.
    As hon. Members know, the Bill brings our law into line with the revised European patent convention. I am, of course, pleased that it has been broadly welcomed for doing so, as there are significant advantages for UK businesses. The House will be aware that the Bill also makes some changes which, we believe, will help in the difficult area of the enforcement of patent rights.
    As I said on Second Reading, we are much more alive to the concerns expressed by patent holders, especially patent holders in small and medium-sized enterprises,
    1426
    about the costs and time associated with patent litigation. In that debate and in Committee, we heard the view that the enforcement measures in the Bill do not go far enough to address those problems, especially in helping SMEs.
    We believe that the changes we are making will certainly help all types of business, in particular SMEs, to resolve disputes over patents. We debated in detail clauses 12 and 13—two of the important ways in which the Bill will amend existing patents legislation, to help with the resolution of patent disputes.
    I promised to consider the careful analysis made in Committee by the right hon. Member for North-East Hampshire of the relationship between clause 12, the Brussels regulation and proceedings for declaration of non-infringement. It is fair to say that although his analysis is, in essence, correct, his proposed solution would, in our view, undermine the delicate balance provided by the threats provisions—merely to circumvent the way in which the Brussels regulation applies in respect of proceedings for declaration of non-infringement. We should accept the operation of that regulation, and its effect on businesses operating in a global market.
    The Bill is but one of the ways in which we are trying to improve patent enforcement. We realise that we cannot be complacent about the enforcement of intellectual property rights. Some new initiatives are being explored, and possible ways of addressing certain difficulties are being considered. We will continue to explore other possible ways to help patent holders enforce their rights, and to help patent holders and third parties resolve disputes over patents.
    That exploration will not end simply because the Bill may be nearing the completion of its parliamentary journey—far from it. For example, there is our continued work on the patent enforcement project, and the results of the Patent Office-led study into that project will, as I indicated in earlier debates, be available shortly. We will no doubt look carefully at those results and how best to take them forward. To give another example: we have already said, during deliberations on the Bill in another place, that we will monitor the ongoing improvements to the patents county court to ensure that it provides access to a simpler, less expensive forum in which to litigate patent disputes.
    The Government's innovation report, published at the end of last year, provides another example of our commitment not to let those issues pass us by. In addition, the joint project of the Prime Minister's strategy unit and the DTI on wealth creation from innovation and the knowledge economy will include an analysis of the current regime of intellectual property rights and their role in encouraging innovation in the knowledge economy.
    We also had an interesting debate on the pronunciation of the word "patent". Colleagues with an interest in the Bill referred to it as the parents Bill and the patients Bill and there was much discussion of what it was actually about. However, the measure is vital.
    Paul Flynn: My hon. Friend will remember the outrageous suggestion that I tried to pull the wool over the eyes of the Committee by saying that the 1,000 people in Newport who have to say "patent" hundreds

    1427
    of times a day decided that as it took three nanoseconds more to pronounce it with a long "a", they would pronounce it with a short "a" so that they could go home earlier for their tea. The outrageous and flimsy counter to that truth from the right hon. Member for North-East Hampshire (Mr. Arbuthnot) was to suggest that the Romans pronounced the word differently. How does he know that? Can he explain?
    Mr. Sutcliffe: I await the reply with interest. I congratulate my hon. Friend for his involvement in the Committee and I also thank the Patent Office in Newport for its excellent work and its support to industry.
    In conclusion, I am proud that the Bill plays a part in the continual process of reform and improvement of the patents system—a process that can be traced back four centuries and which will no doubt continue. Our deliberations have truly been part of the long-standing and admirable tradition of making sure that patent law keeps pace with changes in the economy. We will continue with that process, to ensure that the patents system supports and encourages innovation, for the benefit of everyone.
    I commend the Bill to the House.
    1.18 pm
    Mr. Arbuthnot: The Bill deals with something extremely important to our national economy: innovation and scientific advances. At the Lisbon summit in 2000, the Council of Ministers told us that Europe would become the most competitive and dynamic knowledge-based economy in the world by 2010. That is what the Bill is about. Well, jolly good. So why are we going so fast in the opposite direction? Why did a survey in May by the Swiss business school IMD show that the most competitive economy in the world was that of the USA, and that the UK had fallen another three places to 22nd? Why do we have the lowest growth in the English-speaking world? Why has our productivity collapsed in recent years? Why do we have the largest trade deficit for 300 years? One reason is that we have a Labour Government. Another reason is that this country's patents system is not in tune with that of the modern world.
    Britain is falling behind in Europe. The Financial Times said in an article in 2001:
    "Bottom of the pile for patent enthusiasm was the UK, where only 23 per cent"—
    of small and medium-sized enterprises—
    "had used the system"
    That compared with more than 50 per cent. in Spain. Europe is falling behind in the world. In the USA, taking out a patent costs £10,000. In Europe, it costs about £50,000. In the USA, it takes about a year to take out a patent. In Europe, it takes three years. All that is partly because of the costs of translation, but they only amount to about £12,000 of the £50,000 that must be paid in Europe.
    Enforcing patents is very difficult in this country. As we have heard, the patent reform group has been trying to put pressure on the Government to do something to help, and they have come up with the Bill, which will achieve little and deals with none of the real concerns of
    1428
    the business world. It is, as the Minister said, a necessary Bill because it introduces some minor changes to allow Britain to continue to be a signatory to the European patent convention. If we failed to do that, British inventors would have to take out lots of patents in many different countries in Europe, which would be expensive and time-consuming. There is no point in trying to force them to do that, but no one could say that it is a frightfully important Bill.
    I come now to the key issue raised by the hon. Member for Newport, West (Paul Flynn)—the pronunciation of the word "patent", a matter that exercised the Committee for some time. I said that he had led the Committee and the House up the garden path in suggesting that his constituents were supposed to get home earlier to tea, but I am afraid that he has got me wrong: I was agreeing with his pronunciation of the word "patent", on the basis that the Romans would have pronounced patens—meaning, "open"—with a short "a". I just think that he got his reasoning wrong.
    We do not oppose the Bill. How could we oppose it? There is virtually nothing in it, and it represents a sadly missed opportunity.
    1.22 pm
    Malcolm Bruce: I am conscious of the fact that another hon. Member wishes to speak, and I will allow him the time to do so.
    The Bill is rather disappointing, given that there was a pretty ferocious debate about what people had hoped for. Many hon. Members' core concern is that the reason why there is a lack of enthusiasm for patents in this country is that people do not have enough confidence that they can enforce them. The cost of enforcing patents is so great that is raises the question whether the cost of registering is justified. The Committee addressed that issue, and I am disappointed that the Minister, having been unable to accept one or two of the amendments that I proposed—I understand the reason why—was not able to develop them in ways that would have met those concerns more than the Bill currently does.
    First, we discussed frivolous patents, or vanity patents, and tried to suggest a way to deal with them so that the time, energy and cost were not expended on them. My hon. Friend the Member for Weston-super-Mare (Brian Cotter) entertained the House on Second Reading with examples not of bogus patents—they were fully approved—but of bizarre, irrelevant and rather unworkable ones. Secondly, I remain seriously concerned about the inequalities of defending patents for small and medium-sized companies. It was pointed out and not really challenged that the vast majority of new ideas come from small businesses, which may become larger businesses if they can patent the idea and develop that patent. I cited the example of Mandy Haberman, who invented the "anyway up" cup. I guess that, at the end of the day, she needed the benefit of the defence of her patent to maintain her business, but it cost her almost £1 million to achieve that. That is a good example, and I hope that new clause 1, which the Minister has just introduced, will help someone in that situation in the future, inasmuch as the allocation of the costs will be a little more equitable if one gets to the end of the process.

    1429
    The Bill, assuming that the House will approve it this afternoon, remains unfinished business. We must return to some issues if we are to ensure that the role, defence and legitimacy of patents are properly enshrined in future. There are serious concerns if people are not registering patents because it is too costly or they have no confidence in the system and if large companies—[Interruption.]
    Mr. Deputy Speaker: Order. I am sorry to interrupt the hon. Gentleman, but there must be quiet in the House. There may have been a late surge of interest in the debate, but it must be completed without disturbance.
    Malcolm Bruce: Rarely has the House filled up so enthusiastically for a speech of mine as it has in the past couple of minutes. I simply want to conclude because I am anxious to ensure that the hon. Member with the Patent Office in his constituency has an opportunity to put on record his remarks on the Bill.
    My final concern is that the Minister must continue to keep open the dialogue to try to find ways to ensure that there is confidence in the system, that the cost of registering is kept under control, that enforcement is kept within reasonable cost bounds that are fair and just for small and medium-sized business and that the process of attrition that large businesses can sometimes apply does not get out of hand. Of course, I welcome and support the small improvement that the Bill constitutes, but I hope that the Minister will acknowledge that this is not a closed book.
    1.26 pm
    Paul Flynn: My hon. Friend the Minister can take consolation in the fact that his eloquence and the growing realisation of the Bill's importance has drawn hon. Members into the Chamber in such numbers. Only every 25 years does the House debate a Bill on patents, and it is right that hon. Members should have that experience at least once in their parliamentary careers.
    On the vexed question that has dominated the proceedings on the Bill—the pronunciation of the word "patent"—it is not reasonable to make any assumption on how the Romans spoke their Latin. The pronunciation of the simple word "Davidus", which gave the two Welsh versions of the name—Dafydd and Dewi—has been deliberated for years. There can be no certainty about the interpretation of Roman pronunciation made by the right hon. Member for North-East Hampshire (Mr. Arbuthnot).
    1430
    It is a matter of great importance to my constituency that the Bill is passed. Of course, 2,000 years ago the Romans were in Newport, where the Patent Office is now, at a time when Europe had a common currency. It worthy of note that, after the collapse of the European union that existed in Roman times and the disappearance of that common currency, we entered the dark ages. That might well be a lesson for us all.
    The Bill will do a great deal to modernise our patent service. Although the right hon. Member for North-East Hampshire was a bit sour in his negative comments at the end of his speech, he should note that one of our nation's great successes is our innovation and creativity, and we continue to be brilliant in coming up with new ideas and in building our stock of intellectual property. It was right to relocate the Patent Office to Newport, where it has been a huge success. The office's staff turnover in London was 17 per cent. It has now gone down to nil. The people who came from south-east London have settled happily there, and many of them have now retired and stayed in the area. This is a fine piece of legislation and we look forward to the House passing it without a Division.
    1.28 pm
    Mr. Sutcliffe: With the leave of the House, I should like to respond to this excellent debate. The right hon. Member for North-East Hampshire (Mr. Arbuthnot) said that the Bill was not important, but just look at the House filling up, as hon. Members clamour to come in to hear the detail of the Bill, which is vital to industry. The hon. Gentleman will know that the science and innovation budget has been increased under the comprehensive spending review and that we have a commitment to ensure that British businesses improve.
    We have had good debates on the Bill. As the right hon. Gentleman says, our commitment is to come in line with the European patent convention. That is vital to ensure that our patent system works, and all hon. Members agree with that. It is an important Bill. I am sorry that the hon. Member for Gordon (Malcolm Bruce) is not in his place. [Interruption.] Oh, he is in his place. I should have liked to accept many of his amendments, but they were found to be unworkable. I know that he appreciates the spirit in which we tried to resolve many of the complicated issues involved.
    The Committee was visited by people from the patent reform group and others who wanted to share with us their expertise and views. We had to try to find a way to ensure that we were effective and efficient—
    It being half-past One o'clock, MR. SPEAKER put the Question already proposed from the Chair, pursuant to Order [12 July].
    Bill accordingly read the Third time, and passed, with amendments.

  Intelligence on Weapons of Mass Destruction
  1.30 pm
  The Prime Minister (Mr. Tony Blair): With permission, Mr. Speaker, I will make a statement on the report published by Lord Butler earlier today.
  Lord Butler's report is comprehensive and thorough, and I thank the members of his Committee and their staff for all their hard work in compiling it. We accept fully the report's conclusions.
  The report provides an invaluable analysis of the general threat in respect of weapons of mass destruction and the potential acquisition of WMD by terrorists. Although it devotes much of its analysis to Iraq, it also goes into detail on the WMD threat posed by Iran, Libya, North Korea and A.Q. Khan. Some of the intelligence disclosed is made available for the first time and gives some insight into the reasons for the judgments that I and other Ministers have been making. I hope that the House will understand if I deal with it in some detail.
  The hallmark of the report is its balanced judgments. It specifically supports the conclusions of Lord Hutton's inquiry about the good faith of the intelligence services and the Government in compiling the September 2002 dossier, but it also makes specific findings that the dossier and the intelligence behind it should have been better presented, had more caveats attached to it, and been better validated. It reports doubts that have recently arisen on the 45-minute intelligence, and says that in any event that should have been included in the dossier in different terms. However, it expressly supports the intelligence on Iraq's attempts to procure uranium from Niger in respect of its nuclear ambitions.
  The report finds that there is little—if any—significant evidence of stockpiles of readily deployable weapons, but also concludes that Saddam Hussein did indeed have
  "the strategic intention of resuming the pursuit of prohibited weapons programmes, including if possible its nuclear weapons programme, when United Nations inspection regimes were relaxed and sanctions were eroded or lifted."
  and
  "In support of that goal, was carrying out illicit research and development, and procurement, activities, to seek to sustain its indigenous capabilities."
  and
  "Was developing ballistic missiles with a range longer than permitted under relevant United Nations Security Council resolutions".
  Throughout the past 18 months, and throughout the rage and ferment of the debate over Iraq, there have essentially been two questions. One is an issue of good faith—of integrity. This is now the fourth exhaustive inquiry that has dealt with the issue. This report, the Hutton inquiry, the report of the Intelligence and Security Committee before it, and that of the Foreign Affairs Committee before that, found the same thing. No one lied. No one made up the intelligence. No one inserted things into the dossier against the advice of the intelligence services. Everyone genuinely tried to do their best in good faith for the country in circumstances of acute difficulty. That issue of good faith should now be at an end.
  1432
  But there is another issue. We expected—I expected—to find actual usable chemical or biological weapons shortly after we entered Iraq. We even made significant contingency plans in respect of their use against our troops. UN resolution 1441, in November 2002, was passed unanimously by the whole Security Council, including Syria, on the basis that Iraq was a WMD threat. Lord Butler, in his report, says:
  "We believe that it would be a rash person who asserted at this stage that evidence of Iraqi possession of stocks of biological or chemical agents, or even of banned missiles, does not exist or will never be found."
  However, I have to accept that, as the months have passed, it has seemed increasingly clear that, at the time of invasion, Saddam did not have stockpiles of chemical or biological weapons ready to deploy. The second issue is therefore this: even if we acted in perfectly good faith, is it now the case that in the absence of stockpiles of weapons ready to deploy, the threat was misconceived and therefore the war was unjustified?
  I have searched my conscience—not in a spirit of obstinacy, but in genuine reconsideration in the light of what we now know—to answer that question. My answer would be this: the evidence of Saddam's weapons of mass destruction was indeed less certain and less well founded than was stated at the time. However, I cannot go from there to the opposite extreme. On any basis, he retained complete strategic intent on WMD and significant capability. The only reason why he ever let the inspectors back into Iraq was that he had 180,000 US and British troops on his doorstep. He had no intention of ever co-operating fully with the inspectors, and he was going to start up again the moment the troops and the inspectors departed, or the sanctions eroded. I say further that if we had backed down in respect of Saddam, we would never have taken the stand that we needed to take on weapons of mass destruction, we would never have got the progress on Libya, for example, that we achieved, and we would have left Saddam in charge of Iraq, with every malign intent and capability still in place, and with every dictator with the same intent everywhere immeasurably emboldened.
  As I shall say later, for any mistakes made, as the report finds, in good faith, I of course take responsibility, but I cannot honestly say that I believe that getting rid of Saddam was a mistake at all. Iraq, the region and the wider world are better and safer places without him. [Interruption.]
  Mr. Speaker: Order. The House wants to hear the statement. I will move quickly on any Member who interrupts the Prime Minister. I say the same about the Leader of the Opposition—I will not tolerate any interference in his speech. Let us hear the statement; the House wants to hear the statement.
  The Prime Minister: The report begins with an assessment of intelligence and its use in respect of countries other than Iraq. It points out that in respect of Libya, the intelligence has largely turned out to be accurate, especially regarding its nuclear weapons programmes. Those are now being dismantled. In respect of Iran, the report says that it is now engaged with the International Atomic Energy Agency, although there remain
  "clearly outstanding issues about Iran's activities."

  1433
  On North Korea, the report concludes that it
  "is now thought to be developing missiles capable of delivering nuclear weapons as far away as the continental United States and Europe."
  The report goes on at paragraph 99 to say:
  "North Korea is a particular cause for concern because of its willingness to sell ballistic missiles to anyone prepared to pay in hard currency."
  The report also discloses the extent of the network of A.Q. Khan, the Pakistani former nuclear scientist. The network is now largely shut down through US and UK intelligence work, Pakistani co-operation and the dialogue with Libya.
  The report then reveals for the first time the development of intelligence in respect of the new global terrorism that we face. In the early years, for example, the Joint Intelligence Committee assessment of October 1994 said that the view was that the likelihood of terrorists acquiring or using chemical, biological or nuclear weapons was, while theoretically possible, highly unlikely. However, as the name and activities of Osama bin Laden became better known, the JIC started to change its assessments.
  In November 1998, the JIC assessment said that Osama bin Laden
  "has a long-standing interest in the potential terrorist use of CBR materials, and recent intelligence suggest his ideas about using toxic materials are maturing and being developed in more detail… There is also secret reporting that he may have obtained some CB"—
  chemical and biological—
  "material—and that he is interested in nuclear materials."
  In June 1999, its assessment said:
  "Most of UBL's planned attacks would use conventional terrorist weapons. But he continues to seek chemical, biological, radiological and nuclear material and to develop a capability for its terrorist use."
  By mid-July 1999, the view had hardened still further. The assessment said:
  "There have been important developments in"
  Islamist extremist
  "terrorism. It has become clear that Usama Bin Laden has been seeking CBRN"—
  chemical, biological, radiological and nuclear—
  "materials… The significance of his possession of CB materials is that, in contrast to other terrorists interested in CB, he wishes to target US, British and other interests worldwide."
  A series of further assessments to the same effect was issued in January 2000, and again in August 2000 and January 2001. To anyone who wants to know why I became increasingly focused on the link between terrorism and WMD, I recommend reading that part of the report and the intelligence assessments received.
  It is against this background of what one witness to Lord Butler called the "creeping tide of proliferation" that the events of 11 September 2001 should be considered. As the report rightly says, following 11 September, the calculus of the threat changed. I said in this House on 14 September 2001:
  "We know, that they"
  the terrorists
  1434
  "would, if they could, go further and use chemical, biological or even nuclear weapons of mass destruction… We have been warned by the events of 11 September, and we should act on the warning."[Official Report, 14 September 2001; Vol. 372, c. 606.]
  I took the view then, and I stand by it now, that no Prime Minister faced with this evidence could responsibly afford to ignore it. After 11 September, it was time to take an active, as opposed to reactive, position on the whole question of weapons of mass destruction. We had to close down the capability of the rogue states—usually highly repressive and unstable—to develop such weapons and the commercial networks, such as those of A.Q. Khan, helping them. Again, my clear view was that the country where we had to take a stand was Iraq.
  Iraq was the one country to have used WMD recently. It had developed WMD capability and concealed it. Action by UN inspectors and the IAEA had, by the mid to late 1990s, reduced this threat significantly, but as the Butler report shows at paragraphs 180 to 182, by the time the inspectors were effectively blocked in Iraq, at the end of 1998, the intelligence assessments were that some chemical weapons stocks remained hidden, that Iraq remained capable of a break-out chemical weapons capability within months, had a biological weapons capability—also with probable stockpiles—and could have had ballistic missiles capability in breach of UN resolutions within a year.
  This, of course, was the reason for military action, taken without a UN resolution, in December 1998. Subsequent to that, the report shows that we continued to receive JIC assessments on Iraq's WMD capability. For example, in respect of chemical and biological weapons, in April 2000 it said:
  "Our picture is limited. It is likely that Iraq is continuing to develop its offensive chemical warfare … and biological warfare … capabilities."
  In May 2001, in respect of nuclear weapons, its assessment was that:
  "Our knowledge of developments in Iraq's WMD and ballistic missile programmes since Desert Fox air operations in December 1998 is patchy. But intelligence gives grounds for concern and suggests that Iraq is becoming bolder in conducting activities prohibited by"
  UN Security Council resolution
  "687. There is evidence of increased activity at Iraq's only remaining nuclear facility and a growing number of reports on possible nuclear related procurement."
  Then in February 2002, the JIC said:
  "Iraq … if it has not already done so, could produce significant quantities or BW agent within days."
  The report specifically endorses the March 2002 advice to Ministers, which stated that although containment had been partially successful and intelligence was patchy, Iraq continued to develop WMD. It said:
  "Iraq has up to 20 650km range missiles left over from the Gulf War. These are capable of hitting Israel and the Gulf states. Design work for other ballistic missiles over the UN limit of 150km continues. Iraq continues with its BW and CW programmes and, if it has not already done so, could produce significant quantities of BW agents within days and CW agent within weeks of a decision to do so. We believe it could deliver CBW by a variety of means, including in ballistic missile warheads. There are also some indications of a continuing nuclear programme."

  1435
  The point I would make is simply this: the dossier of September 2002 did not reach any startling or radical conclusion. It said, in effect, what had been said for several years based not just on intelligence, but on frequent UN and international reports. It was the same conclusion, indeed, that led us to military action in 1998, to maintain sanctions, and to demand the return of UN inspectors.
  We published the dossier in response to the enormous parliamentary and press clamour. It was not, as has been described, the case for war, but it was the case for enforcing the United Nations will, In retrospect, it has achieved a fame it never achieved at the time. As the Butler report at paragraph 310 states:
  "It is … fair to say at the outset that the dossier attracted more attention after the war than it had done before it. When first published, it was regarded as cautious, and even dull. Some of the attention that it eventually received was the product of controversy over the Government's further dossier of February 2003. Some of it arose over subsequent allegations that the intelligence in the September dossier had knowingly been embellished, and hence over the good faith of the Government. Lord Hutton dismissed those allegations. We should record that we, too, have seen no evidence that would support any such allegations."
  Indeed, the report says at paragraph 333 that in general the statements in the dossier reflected fairly the judgments of past JIC assessments.
  The report, however, goes on to say that with hindsight making public that the authorship of the dossier was by the JIC was a mistake. It meant that more weight was put on the intelligence than it could bear, and put the JIC and its chairman in a difficult position. It recommends in future a clear delineation between Government and JIC, perhaps by issuing two separate documents. I think this is wise, although I doubt that it would have made much difference to the reception of the intelligence at the time. The report also enlarges on the criticisms of the ISC in respect of the greater use of caveats about intelligence both in the dossier and in my foreword, and we accept that entirely.
  The report also states that significant parts of the intelligence have now been found by the Secret Intelligence Service to be in doubt. The chief of the SIS, Sir Richard Dearlove, has told me that it accepts all the conclusions and recommendations of Lord Butler's report that concern the service. The SIS will fully address the recommendations that Lord Butler has made about its procedures and about the need for the service properly to resource them. The service has played, and will continue to play, a vital role in countering worldwide the tide of proliferation of weapons of mass destruction. Indeed, its successes are evident in Lord Butler's report.
  I accept the report's conclusions in full. Any mistakes should not be laid at the door of our intelligence and security community. They do a tremendous job for our country. I accept full personal responsibility for the way in which the issue was presented and therefore for any errors that were made.
  As the report indicates, there is no doubt that at the time it was genuinely believed by everyone that Saddam had both strategic intent in respect of WMD and actual weapons. I make this further point. On the sparse, generalised and highly fragmented intelligence about al-Qaeda prior to 11 September, it is now widely said that
  1436
  policy makers should have foreseen the attacks that materialised on 11 September 2001 in New York. I only ask: had we ignored the specific intelligence about the threat from Iraq, backed up by a long history of international confrontation over it, and that threat later materialised, how would we then have been judged?
  I know that some will disagree with this. There are those who were opposed to the war, remain so now, and will for ever be in that position. I only hope that now, after two detailed parliamentary Committee reports, a judicial inquiry more exhaustive than any has ever been in examining an allegation of impropriety against Government, and now this voluminous report, people will not disrespect the others' point of view, but will accept that those who agree and those who disagree about the war in Iraq hold their views not because they are warmongers on the one hand or closet supporters of Saddam on the other, but because of a genuine difference of judgment as to the right thing to have done.
  There was no conspiracy. There was no impropriety. The essential judgment and truth, as usual, does not lie in extremes. We all of us acknowledge that Saddam was evil and his regime depraved. Whether or not actual stockpiles of weapons are found, there was not and is not any doubt that Saddam used weapons of mass destruction and retained every strategic intent to carry on developing them. The judgment is this: would it have been better or more practical to have contained him through continuing sanctions and weapons inspections, or was this inevitably going to be, at some point, a policy that failed; and was removing Saddam a diversion from pursuing the global terrorist threat or part of it?
  I can honestly say that I have never had to make a harder judgment. But in the end, my judgment was that after 11 September, we could no longer run the risk—that instead of waiting for the potential threat of terrorism and WMD to come together, we had to get out and get after it. One part of that was removing the training ground of al-Qaeda in Afghanistan. The other was taking a stand on weapons of mass destruction, and the place to take that stand was Iraq, whose regime was the only one ever to have used WMD and was subject to 12 years of UN resolutions and weapons inspections that turned out to be unsatisfactory. Although in neither case was the nature of the regime the reason for conflict, it was decisive for me in the judgment as to the balance of risk for action or inaction.
  Both countries—Afghanistan and Iraq—now face an uncertain struggle for the future, but both at least now have a future. The one country in which one will find an overwhelming majority in favour of the removal of Saddam is Iraq. I am proud—was proud and remain proud—of this country and the part it played, especially our magnificent armed forces, in removing two vile dictatorships and giving people oppressed, almost enslaved, the prospect of democracy and liberty. This report will not end the arguments about the war, but in its balance and common sense, it should at least help to set them in a more rational light; and for that we should be grateful.
  Mr. Michael Howard: In his statement, the Prime Minister relied on a finding in the report relating to the good faith of the Government in paragraph 310. The Prime Minister read it out, and it refers specifically to allegations that the

  1437
  intelligence in the September dossier had knowingly been embellished, and it agrees with Lord Hutton on those allegations. It does not refer to other findings in the report; it does not refer to what the Prime Minister said; it does not give the Prime Minister a defence. In January this year, the Prime Minister said:
  "The issue vis-à-vis my integrity is: did we receive the intelligence and was it properly relayed to people?"
  The question that arises from that statement is: was the intelligence given to the Prime Minister accurate, and did he give an accurate account of it to the country? Let us examine, on the basis of the Butler report, what the intelligence services told the Prime Minister, and then what he told the country.
  On 15 March 2002, the Joint Intelligence Committee said:
  "Intelligence on Iraq's weapons of mass destruction … and ballistic missile programmes is sporadic and patchy."
  I repeat, "sporadic and patchy". On 21 August 2002, the JIC said that
  "we have little intelligence on Iraq's CBW doctrine, and know little about Iraq's CBW work since late 1998".
  I repeat:
  "we have little intelligence … and know little".
  On 9 September 2002, the JIC said: "Intelligence remains limited." I repeat: "Intelligence remains limited." That is what the JIC told the Prime Minister, so let us look at what he told the country.
  The Prime Minister, in his signed foreword to the September 2002 dossier, said:
  "I am in no doubt that the threat is serious and current."
  He also said that
  "the assessed intelligence has established beyond doubt that Saddam has continued to produce chemical and biological weapons."
  I repeat that the Prime Minister said that he was in "no doubt", and that the intelligence was "beyond doubt".
  On 24 September 2002, the Prime Minister told the House that the picture painted by the intelligence services was "extensive, detailed and authoritative"—not "sporadic and patchy". Is that not why Lord Butler concludes that it was
  "a serious weakness that the JIC's warnings on the limitations of the intelligence underlying some of its judgements were not made sufficiently clear"?
  Is that not why Lord Butler concludes that the failure to include the limited intelligence base on which some of those assessments were made was "significant"? Is that not why Lord Butler concludes, specifically in relation to the language used by the Prime Minister, that it may have reinforced the impression that
  "there was fuller and firmer intelligence behind the judgements"
  in the September dossier than was, in fact, the case.
  I return to the central question: was the intelligence given to the Prime Minister accurate, and did he give an accurate account of it to the country? It is now clear that in many ways the intelligence services got it wrong, but their assessments included serious caveats, qualifications and cautions. When presenting his case to the country, the Prime Minister chose to leave out those caveats, qualifications and cautions. Their qualified
  1438
  judgments became his unqualified certainties, and the question that he must answer today is: why? He has said that mistakes were made and he accepts responsibility, but it is not a question of responsibility—it is a question of credibility. I hope that we will not face in this country another war in the foreseeable future, but if we did and this Prime Minister identified the threat, would the country believe him? [Interruption.]
  Mr. Speaker: Order. I want the hon. Member for Huddersfield (Mr. Sheerman) to be quiet. If there is any breach of the rules of the House there is a danger that the House will be suspended, which means that the Prime Minister and the Leader of the Opposition will have to wait until I recall it, so bear that in mind. I do not expect the right hon. Member for Dewsbury (Ann Taylor) to interfere either.
  Mr. Howard: If we faced such a prospect, and the Prime Minister asked the country to rely on intelligence, would it have confidence in him? If he said that in his judgment war was necessary, would the country trust him? The issue is the Prime Minister's credibility. The question that he must ask himself is: does he have any credibility left?
  The Prime Minister: Let me first deal with the issue of good faith. The right hon. and learned Gentleman supported the war—indeed, he supports it still.
  Mr. Howard: On the basis of what you said.
  The Prime Minister: Oh, is that reason? Let us just look at that for a moment. Was the right hon. and learned Gentleman duped into supporting the war by me? Let me quote something that the shadow Foreign Secretary said six months before the dossier was published:
  "The Iraqi threat is indisputable. Horrific weapons of mass destruction in the hands of a despot who will use them or give them to others to use in every part of the world."
  A few months later, before the dossier was published, he said:
  "We know there are weapons of mass destruction."
  The Leader of the Opposition made a speech to Murdoch's News Corporation in March this year, after the Hutton report, after all the arguments about the intelligence, and I managed to get hold of a copy. He said
  "The war against Iraq was necessary. It was just. It was, indeed, arguably overdue."
  He went on:
  "The British Conservative Party has been consistent in its support for the British Government"—
  that was in March this year, not March last year—
  "and for our armed forces, over the war in Iraq. Indeed"—
  he went on to boast—
  "Tony Blair would not have won last year's vote in the House of Commons … which gave him the mandate to go to war, without the support of the Conservative Party."
  So let us have no more of him being tricked into

  1439
  supporting the war by me. The fact of the matter is that he thought it was right then and he thinks even now, does he not, that it was right to go to war?
  Mr. Howard: Answer the question.
  The Prime Minister: Go on—just a nod of the head will do. The right hon. and learned Gentleman thinks even now that it was right to go to war, does he not? So let us leave aside his usual opportunism and understand that we both agreed that Saddam was a threat, we both still think Saddam was a threat and we both think the war was justified. Let us therefore concentrate on making Iraq better, not on point-scoring that has nothing to do with the central issues.
  Mr. Charles Kennedy: As the Prime Minister rightly acknowledges in his statement, whatever views we all took about the war, there is no doubt, given the importance of this report and others and his statement this afternoon, that nothing will ever be able to erase the loss of British military life and the loss of life of innocent Iraqi civilians.
  Our fundamental disagreement, as the Prime Minister knows from the time that he announced the setting up of Lord Butler's inquiry, remains. We argued from the outset that we wanted the political judgments that informed the decision that the Prime Minister took to go to war to be placed properly under the microscope. As we have seen from the very thorough and detailed piece of work that Lord Butler has produced, that was not possible within the remit set. However, what is possible within the remit and the words that Lord Butler has chosen to use in his report is to pose some direct questions to the Prime Minister arising from it, not least because the Prime Minister said in response to me when he made his statement setting up the inquiry that on the issue of political judgment
  "to subcontract to some committee the issue of whether it was right or wrong to go to war is not merely wrong: ultimately it is profoundly undemocratic."—[Official Report, 4 February 2004; Vol. 417, c. 755.]
  Lord Butler states in chapter 5 on page 99 that
  "from the evidence which has been found and de-briefing of Iraqi personnel it appears that prior to the war the Iraqi regime … did not, however, have significant—if any—stocks of chemical or biological weapons in a state fit for deployment, or developed plans for using them."
  As the Prime Minister says he accepts the report in full, he must accept that observation. Can he therefore square his acceptance of that observation with his own words in the introduction to the dossier, in which he wrote:
  "I believe the assessed intelligence has established beyond doubt that Saddam has continued to produce chemical and biological weapons"?
  Does not Lord Butler's conclusion, which I quoted, reinforce what the Prime Minister had said much earlier, in 1998, when he argued that the policy of containment was working?
  In chapter 7, on page 141, Lord Butler points out:
  "These international agencies"—
  that is, UNSCOM and the International Atomic Energy Agency—
  1440
  "now appear to have been more effective than was realised at the time in dismantling and inhibiting Iraq's prohibited weapons programmes."
  He goes on:
  "The value of such international organisations needs to be recognised and built on for the future, supported by the contribution of intelligence from national agencies."
  If the Prime Minister accepts the first part of that observation, as he has acknowledged, what steps will he take to make sure that the conclusion is followed, to underpin those international organisations for any similar events in future?
  Moving away, as we did, from the containment policy at the time of the September 2002 dossier, huge focus was placed on the 45 minutes claim. I take issue with the Prime Minister when he says this afternoon that that dossier assumed importance after the event. Surely he, like the rest of us, remembers, for example, well-publicised events such as tanks being deployed at Heathrow airport and the newspapers being full of the 45 minutes warning. That was the context at the time.
  Lord Butler says of the 45 minutes claim:
  "the JIC should not have included the '45 minute' report in its assessment and in the Government's dossier without stating what it was believed to refer to. The fact that the reference in the classified assessment was repeated in the dossier later led to suspicions that it had been included because of its eye-catching character."
  If the Prime Minister accepts that conclusion, could he tell us who bears the ultimate responsibility for the claim's inclusion and its highlighting in that way?
  Finally, in chapter 5 at paragraph 465, Lord Butler states:
  "We conclude that it was a serious weakness that the JIC's warnings on the limitations of the intelligence underlying its judgements were not made sufficiently clear in the dossier."
  That goes to the heart of the matter for many, many people. The legality of the war was a key issue. The advice of the Attorney-General has been looked at, as well as the advice—at times conflicting—from within the Foreign Office. It is acknowledged that twice in the past such advice has been made public. Is it not time that all of us were able to see the full advice tendered by the Attorney-General?
  Lord Butler speaks of a collective failure on the part of the Joint Intelligence Committee, but if that collective failure applied to the JIC, did it not also apply to the key political players in and around No. 10 Downing street at the time?
  The Prime Minister presides, we are told, over a Cabinet process of informality on such important issues. If he accepts the report's conclusions and recommendations, does he have any procedures in place, or is he planning any changes to his management of Cabinet government for such an important issue as war and peace? Surely we have a right to be told that.
  Inevitably, Lord Butler and his colleagues, deep and elaborate though their task has been, have not been able to address the fundamental question that many of us wanted to have addressed from the start: what was the key reality of the political judgments that led us to this war? When the Prime Minister now says that the outcome was desirable, albeit arrived at by insufficient conclusions and methodology, surely that is not a

  1441
  satisfactory way to proceed. Congress is continuing to try and get to the bottom of these matters. Surely the British Parliament should be seen to do better as well.
  The Prime Minister: First, I shall deal with one or two of the individual points.
  With reference to the tanks at Heathrow, I am not sure what point the right hon. Gentleman was making, but I can assure him that the reason we took that action, as has already been explained, is that we were advised to take that action. It was for no other reason than that. If we had ignored that advice, we would have been behaving very irresponsibly.
  On containment, yes, there was a policy of containment in respect of Saddam. People were always extremely doubtful whether it was working and became increasingly doubtful after the bombing of Baghdad in 1998. Yes, I and others wanted containment to work and at times believed it could work, but the evidence that we have now indicates almost certainly that it was not working. That is why I come back to the point about balance. At each stage, the right hon. Gentleman takes certain parts out of the Butler report and says that Lord Butler found that there was no threat from Saddam in respect of WMD. [Interruption.] That is what he tried to imply.
  As I pointed out to the House, however, it is clear that Lord Butler reached no such conclusion. Indeed, he said that it would be rash to draw any conclusion, even about WMD missiles in Iraq at the moment. He said, first, that Saddam plainly had the strategic intention of resuming the prohibited weapons programme; secondly, that Saddam was carrying out illicit research, development and procurement activities in support of that programme; and thirdly, that Saddam was developing ballistic missiles with a range longer than that permitted under the relevant UN resolutions.
  I shall quote what the right hon. Gentleman said in the Western Morning News two days after we published the dossier. He said that there was
  "no killer fact"—
  in the dossier—
  "more a confirmation of what we already knew."
  Everybody believed the same thing about WMD and it would be wrong to suggest that the dossier somehow altered his perception. He was not persuaded by the dossier and voted against the war, which is why I at least have some time for his objections, as opposed to those raised by the Leader of the Opposition.
  On the basis of the Butler report, the right hon. Gentleman must accept that Saddam still remained a threat of some sort, and I think that he does accept that. I think that he accepts that it was important to put back the inspectors into Iraq, and I also think that he accepts that the inspectors would never have been anywhere near Iraq but for the presence of US and British troops. The issue is whether we should have waited longer. [HON. MEMBERS: "Yes."] I shall deal with that head on.
  In March 2003, I made strenuous attempts to get a second UN resolution. I did so on the basis that we had to go through all Saddam's areas of non-compliance—it was clear that he was not complying—set them out in
  1442
  the prescribed form in a UN resolution, and then combine that resolution with an ultimatum to Saddam that either he did those things or we would take action. If we had managed to secure that resolution, I agree that we would have had more time, but the plain fact of the matter was that we could not get agreement in the Security Council resolution to any form of ultimatum in any set of circumstances.
  In March 2003, we knew that Saddam was a threat and that the troops were the only reason why he had allowed the inspectors in, and we were left in a situation in which we could not obtain agreement on an ultimatum to him to comply with the UN inspectors. As I explained to the House at the time, we had a choice: we could either back down and not have inspectors backed by troops with an ultimatum or stick with it and see it through, and I still believe that we did the right thing in seeing it through.
  I want to make one final point. As many people do, the right hon. Gentleman talked about the murder of innocent civilians in Iraq. That point is occasionally presented as if the civilians who have died and who are dying in Iraq are somehow dying as a result of coalition action. We are not killing civilians in Iraq, terrorists are killing civilians in Iraq. What is more, thousands of people were killed in Iraq year in, year out under Saddam. The best judges of the best interests of civilians in Iraq are Iraqi civilians themselves, and they are the ones who congratulate us most on getting rid of Saddam.
  Ross Cranston: Will my right hon. Friend confirm that despite the speculation, the report does not criticise the Attorney-General or question the legal advice? He knows that there are disagreements among lawyers. In fact, the report notes that the deputy legal adviser at the Foreign and Commonwealth Office resigned—honourably—because she disagreed. At the end of the day, there was non-compliance over 12 years with UN Security Council resolutions. Security Council resolution 1441, which was unanimous, gave Iraq a final opportunity to comply, and Iraq failed to do so, which was the legal basis for what we did.
  The Prime Minister: What my hon. and learned Friend says is absolutely right. As he pointed out, the Attorney-General's legal advice was not related to the intelligence.
  Sir John Stanley: Will the Prime Minister assure the House that the unprecedented degree of interleaving of the political presentation process with the intelligence process that took place in the lead up to the war in Iraq will not continue under his Government?
  The Prime Minister: What I will say to the right hon. Gentleman is that we should accept entirely the recommendation of the Butler report that it would probably be better in future to separate the Government case and whatever JIC assessments are made. Had we done that, however, the effect would have been the same, and that point is very clear if one studies the Butler report. I remember—the right hon. Gentleman probably remembers this too—the enormous clamour

  1443
  at the time to provide the intelligence. The provision of intelligence in that way was unique but, given the different world in which we live and the different type of security threat that we face today. I suspect that it will not be the last time that we are called upon to do such a thing.
  Ann Clwyd: My right hon. Friend is right when he says that it is the Iraqi people themselves who are most pleased by the removal of Saddam Hussein, whom they always saw as the biggest weapon of mass destruction. Over the past two days, I have been at my old university college, where I met a man who fled the regime some years ago and who has since become a fellow of the university of Wales, Bangor. In a newspaper article, he said:
  "Millions of my people have been saved thanks to the downfall of Saddam."
  The article includes a photograph of a crowd of students who attended university with him in Iraq, all of whom were murdered by Saddam's regime or went into exile. I am glad to hear my right hon. Friend say that, even if we knew then what we know now, we would still have gone ahead with removing that awful regime.
  The Prime Minister: I thank my hon. Friend for that and once again congratulate her on the work that she did before Iraq was an issue for all of us. That work is an immensely powerful testament to her integrity and perseverance.
  Mr. Robert Jackson: As co-chairman of the Council for Arab-British Understanding, I chaired a meeting on Monday with the new deputy Foreign Minister of Iraq. The real progress that is being made in that country is not often acknowledged in our press, which sometimes gives the impression that it would prefer disaster, so that the war could be shown to be wrong. The deputy Foreign Minister's main point was that the country needs to learn the lessons from the past and tackle the problems that it faces in the future. Should we not draw the same conclusions for Britain? We in Britain should learn the lessons of the past, and put these inquiries behind us and we must get on and tackle the problems of the future concerning terrorism and proliferation.
  The Prime Minister: I thank the hon. Gentleman for that point. I explained in some detail the intelligence that we received not only on Iraq, but on Osama bin Laden and that particular type of terrorism to try to explain to people why I believe that there is a link between those two issues, and why going after the issue of WMD is not a diversion from pursuing global terrorism. 1 agree with the hon. Gentleman, and I have spoken to the Foreign Minister of Iraq. The Iraqis face the prospect of becoming a stable partner in the region, which will make a huge difference to the stability of the region and the world.
  Mr. George Howarth: Does my right hon. Friend agree that, perhaps justifiably, never has a Government decision been so deeply inquired into? At the end of those inquiries, two conclusions cannot be doubted: first, the security services acted with integrity; secondly, the
  1444
  Government acted in good faith and with integrity. Is not the proper response now for all of us to get behind the effort to build a democratic, secure Iraq and to stop the inquiries, because we now know what took place and why?
  The Prime Minister: I do think that it is time that we recognised that the goal now is to make Iraq a stable country. I also emphasise once again that, as I said at the very outset of my statement, the key to this report is balanced judgments. People can pick out one part of the report or not, but the plain fact is that although it does indeed cast doubt on some of the intelligence that was relied on, it most certainly does not conclude that Saddam Hussein was not a threat in respect of WMD.
  Mr. Kenneth Clarke: Will the Prime Minister bring himself to accept that Lord Butler has shown more clearly than ever before, in annexe B and elsewhere, that time and again the Joint Intelligence Committee's first publication used language to describe the threat that did not match the language of its own assessments by its own officers?
  Can the Prime Minister think of any explanation for the removal of all the caveats and doubts in producing that publication other than that John Scarlett had been persuaded, by the Prime Minister's press secretary and others, to remove all the cautionary words and to stiffen up the case?
  Most importantly, does the Prime Minister believe that if, when he came to this House and made the case for war, he had used the actual language of the intelligence assessments that he had read, he would still have won the vote that carried this country into war? I must tell him that I do not think that he would have done.
  The Prime Minister: I totally disagree with the right hon. and learned Gentleman. He, of course, opposed the war, and was perfectly entitled to do so. He opposed the war at the time and opposes it now. I have absolutely no doubt at all that had the caveats been put in about the limits of intelligence and so on, the essential fact would have remained—that there was the clearest possible evidence on Saddam Hussein and weapons of mass destruction. Resolution 1441, which was passed subsequent to the dossier, was a resolution of the entire international community.
  If the right hon. and learned Gentleman looks at Lord Butler's report as a whole, he will find that the allegation that there was a knowing embellishment of the intelligence is refuted. That is precisely what Lord Hutton looked into, and precisely what Lord Butler, along with everyone else, finds is not right.
  I suggest that the right hon. and learned Gentleman, like others who opposed the war, should recognise that he simply made a different judgment as to what we should do in the light of this threat. The argument was not over the details of the threat. The argument was: is the judgment that the best way of dealing with this threat is to get the inspectors back in and leave them there for a period of time, or to continue the sanctions regime, or do we recognise that the only way of dealing with this threat is to remove the person constituting it? That is the difference of judgment between us: it was

  1445
  then and it is now. Nothing will change that, but I am afraid that I disagree with the right hon. and learned Gentleman's judgment.
  Mr. Robin Cook: May I welcome the Prime Minister's frank acceptance that there were no stockpiles of weapons of mass destruction at the time of war? He is entitled to argue that that does not mean that there was no justification for the war, but it does surely mean that there was no urgent necessity for the war, because there was no imminent threat. Will he now recognise that there was time for Hans Blix to finish his job and to confirm through the process of UN weapons inspections that Saddam had no weapons of mass destruction and that, had he done so, we might have been spared the unavoidable conclusion from the content of the Butler report—that we committed British troops to action on the basis of false intelligence, overheated analysis and unreliable sources?
  The Prime Minister: I know that my right hon. Friend has always taken the view that it would have been better if we had proceeded with the second UN resolution. I know, too, that he believes that we should have allowed Hans Blix to remain there for a longer period of time. I simply have to say to him that, as I said to the leader of the Liberal Democrats, if we had secured the second resolution, with a series of conditions and an ultimatum, then yes, there would have been more time. As I used to say at the time, it is not a question of a specific amount of time, but a question of Saddam fully complying, because that is what resolution 1441 says—that Saddam had fully to comply. I think that my right hon. Friend would accept that there is no way the UN inspectors would ever have been back in Iraq without the troops being there. And there is no evidence that Saddam was ever complying fully—indeed, the evidence points the other way.
  The problem is this. I agreeߞand I thought that my right hon. Friend put it, at least in the first part of his question, in a moderate way—that we have to put this in a different way with hindsight. I also say that, if it is correct, as Lord Butler also finds, that there was a clear strategic intent, that there was the illicit procurement of material in order to develop WMD, and that Saddam was carrying on developing ballistic missiles in breach of UN resolutions, there is no doubt that he was indeed in breach of those UN resolutions. So the question is this: if we had left the inspectors there longer, with the troops still down there, would they, in the end, have discovered, not that there were no stockpiles, but that there were actual breaches of the UN resolution, as Lord Butler finds?
  I have to say to my right hon. Friend that, ultimately, I do not believe that even if we had left the inspectors thereߞwith the troops, because he acknowledges, as I do, that the troops would have had to be there to keep the inspectors thereߞfor three months, six months, or even nine months, Saddam would ever have complied, because he never had any intention of giving up his WMD ambitions. In the end, therefore, we faced the choice of whether to take this on and deal with it or not.
  Incidentally, I would also say to my right hon. Friend that that is the reason why he and I, without a UN resolution, took military action in December 1998. We
  1446
  did not take that action because we had some doubt about Saddam and WMD—we took that action because we were certain of it and believed that it was the right thing to do. I know that there was a difference between us on the second resolution, but I believed that it was the right thing to do in December 1998 and I believed that it was the right thing to do in March 2003.
  Mr. David Trimble: I wonder if the Prime Minister would agree with the following summary, as we stand back from things and look at them. There was, and continues to be, a very good case for the action that was taken with regard to Iraq, but the Government, in their anxiety and eagerness to get the widest possible support for that action, oversold the case, and the reaction from that has led to an undermining of the good case and results in a situation whereby it is now more difficult for us to make progress. Does the Prime Minister remember once making a similar mistake?
  The Prime Minister: No, I am afraid that I do not; and I have to tell the right hon. Gentleman that I do not agree with him. Even if one put in all the caveats, as the report suggests, the fact is that what we said at the time, back in September and in March, is that Saddam Hussein is an active WMD threat and has actual deployable weapons. That was the effect of the intelligence. No matter what changes we made to the way in which it was put, that fundamental thing would have remained. I say to the right hon. Gentleman, as I have said to others, that the fact is—this is why I am afraid that I cannot say that we were wrong in taking the action that we did—that even if we accept what is in Lord Butler's report now, that does not mean going to the opposite extreme and saying that there was no threat at all.
  Kali Mountford: Is it not the case that the policy of containment could be said to have been working only if we accepted people's containment in a situation of despair and mass graves? Is it not also the case that weapons of mass destruction, and the belief in them, were vital to the Saddam regime to maintain that state of despair? If we are to continue in this way as an international community, should not we now consider redrawing international agreements to ensure that when similar situations arise the case for action is absolutely clear?
  The Prime Minister: I entirely accept what my hon. Friend says. There is a very strong case, in the different world in which we live, for recognising that there may be circumstances in which we have to take such action in future. There is clear evidence of bin Laden, al-Qaeda and this new form of terrorism trying to acquire WMD. The best account of that, strangely, is in the statements made by Dr. David Kay, who was with the Iraq survey group. He says that, because of the nature of Saddam's regime—its instability and the way in which people were treated—the threat may have been different from, but greater than, the threat that we anticipated. That is why I believe that in future we will be placed in a situation where we have to calculate whether we need to take such action.
  Mr. Alan Duncan: Does the Prime Minister agree that it would be unjust for any public servant to take the rap today? What steps will he take to shoulder the blame, which, he admits, rests with him, when the main reason for the failure that the report uncovers and outlines largely on page 147 is the Prime Minister's circumvention of all the decencies and formalities of a proven system of government, and his replacement of it by informality. chumminess, distorted lines of communication and the concentration of all power around him and a small coterie in No. 10?
  The Prime Minister: I do not recognise that quote from the report, unless I missed something. Apart from the fact that regular, minuted meetings of the relevant Cabinet Ministers took place, the Cabinet discussed the matter in detail on no fewer than 24 occasions.
  Donald Anderson: Will my right hon. Friend confirm that, at the relevant time—before the publication of the September dossier—the then Leader of the Opposition had full briefing from the intelligence community and did not try to play politics with the matter, impugn my right hon. Friend's credibility or criticise any loss of caveats when the relevant debates took place? Will he also remind hon. Members that we are considering the fourth such report on the issue? Of course, some will never be happy because they want my right hon. Friend's scalp, which, again, an inquiry has denied them Is not it important that we now concentrate on the genuine consensus on the reconstruction of Iraq so that it does not pose a threat to the world community, its neighbours and, most of all, its own people?
  The Prime Minister: I entirely endorse my right hon. Friend's comments about the previous Leader of the Opposition, who supported us strongly throughout and acted somewhat in contrast to the right hon. and learned Gentleman who now occupies his place.
  It is important that we concentrate on the future in Iraq, while recognising that its history is one of trouble not only for its people but for the region and the wider world. That is why it is important that it becomes a stable partner for peace.
  Mr. Richard Shepherd: I am sure that the Prime Minister recognises that many hon. Members voted for the war on the case that he made so passionately and assuredly, and that, in the light of the material that became available through the Hutton inquiry and now through Lord Butler, they would not have voted for it. Is not it even more alarming that, after the Prime Minister based his case for war so narrowly, clearly and vehemently on the threat of weapons of mass destruction to the country, he now extends the basis for going to war and thus justifies it?
  The Prime Minister: We went to war to enforce the UN resolutions that were outstanding in respect of Iraq and weapons of mass destruction. I have had to concede, as the Butler report finds, that some of the intelligence cannot be relied upon, but the hon. Gentleman goes to the other extreme and says that, in that case, there was no problem. There was a problem: our evidence, which the Butler report details, is about
  1448
  breaches of UN resolutions. If that information had reached the inspectors when they were in Iraq, it would have constituted a breach of resolution 1441.
  It is not a matter of my extending the case; there is a genuine issue, and that is why I went into such detail in my statement. It is my belief, which many people dispute, that there is a different sort of security threat today. It comes from the combination of the new form of global terrorism—terrorism is always evil, but we are considering a different sort, which is without limit—and the development and proliferation of weapons of mass destruction in unstable, repressive states or the commercial networks that live off them. That possible combination is the security threat that we face.
  My thinking has changed after 11 September. I am prepared to take all the criticism and so on because I know that, in future, people would look back and want to know why, if we were given information about the actions of terrorists after 11 September, and we knew about the trade and development of weapons and that terrorists were trying to get hold of them and unstable countries were proliferating them, we did not do anything to stop that. I therefore believe that we have to take an active rather than a reactive position. That is why we are in the current situation. I do not regret it.
  If the Butler report had found that Saddam and weapons of mass destruction were all a hoax, that would he different. However, no one seriously claims that. The issue is the extent to which readily deployable stockpiles existed. There is no question about the threat that Saddam posed because he used the weapons. There is no question about the intent, because the report found that. The question is what action to take—that judgment had to be made. Some people take the view that action was not necessary because the threat was not strong enough, but my view is that it was powerful enough. That is the difference between us. It is not an issue of integrity or good faith; it is just a disagreement.
  Mr. Peter Kilfoyle: The Prime Minister said that everyone genuinely believed that Saddam had both strategic intent for WMD and actual weapons. That is a classic definition of a threat: capability plus intent. However, I remind him that many of us took issue with that at the time. We voted for an amendment that said that the case for war was not proven—it was as simple as that.
  On intent and the way in which the imminent threat has long been the key to trying to convince Parliament and the people of the Government's case, I refer the Prime Minister to paragraph 374 of the Butler report—
  Mr. Speaker: Order. The hon. Gentleman must remember that a supplementary question should be brief. Other Back Benchers wish to speak. Perhaps he could ask the question succinctly.
  Mr. Kilfoyle: The Attorney-General said that there would be no justification for the use of force against Iraq on the ground of self-defence against an imminent threat.
  The Prime Minister: With the greatest of respect, that was not the issue. Indeed, on 24 September, when I presented the dossier to the House, I said that I could

  1449
  not say that Saddam would use the weapons this year or next year. The dossier was the reason why we went back to the UN. If I believed that there was an imminent threat to this country from Saddam, we would not have waited for the UN but would have taken action immediately. I came to the view, which I still hold, that the potential combination of global terrorism and WMD meant that we had to act on WMD. That is what we did. As to the belief about Saddam and weapons of mass destruction, I simply refer my hon. Friend back to resolution 1441, which clearly stated that he was a threat in respect of the weapons.
  Mr. Elfyn Llwyd: I am pleased to say that we on these Benches were not duped into supporting the war, and we remain of that view. The Butler report refers to strains, mistakes, misinformation and the resultant carnage. Somehow, no one is to blame for all that. Why does not the Prime Minister take responsibility and do the honourable thing?
  The Prime Minister: First, Lord Butler does not use the words that the hon. Gentleman did. Secondly, let us consider the judgment at the heart of the matter. The hon. Gentleman says that he is glad that he was not duped into supporting the war, but if he had his way, Saddam Hussein would continue to run Iraq. [Interruption.] I have to deal with the consequences of my position, and he must deal with those of his. Would Saddam Hussein's continuing to run Iraq mean that the world and the region was a safer place? I do not think so.
  Angela Eagle: In the press conference that launched the report before the statement in the House, Lord Butler said, in answer to questions, that there was
  "no evidence to question the Prime Minister's good faith."
  The report states:
  "We have no evidence of deliberate distortion or culpable negligence … Government believed the assessments it was putting forward to the British people … There was no intention to mislead."
  How on earth can we listen to the Prime Minister's integrity being traduced by the Leader of the Opposition and others? They are not reading the same report.
  The Prime Minister: What my hon. Friend says is absolutely right. The disagreement that we should have is about the judgment over whether it was right to go to war. That is a disagreement that I can have with the Liberal Democrats. The problem for the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) is that he supported the war and, truthfully, he supports it still. He therefore has to rerun the allegation of bad faith because he cannot make the case against the war.
  Sir Patrick Cormack: As one who voted on 18 March to support the Prime Minister, who does not regret that vote and who recognises that the consequence of a different vote would have been a shattering of the alliance, the remaining in power of Saddam Hussein and the fall of
  1450
  the British Government, may I ask the Prime Minister whether he accepts that the Butler report underlines the fact that intelligence is an inexact science? It does not endorse or whitewash everything that the British Government did, but nor is it an indictment of the decision that the House took.
  The Prime Minister: I thank the hon. Gentleman for that; I agree with Him entirely. We should study the recommendations of the report carefully and implement them. As he rightly says, this is not an issue of integrity or good faith. It is about trying to deal with difficult decisions in a difficult world.
  Mr. Mike Hall: May I draw my right hon. Friend's attention to what Lord Butler said in his press conference this morning? He said that intelligence gathering in Iraq was very difficult because of the closed regime. He also said that intelligence gathering had been made more difficult by the cuts in the 1990s following the end of the cold war. What is my right hon. Friend going to do about that aspect of the report?
  The Prime Minister: What we are doing already is increasing significantly resources for the intelligence services. There has been criticism of some of the people concerned, but I think that the intelligence services do a fantastic job for this country—I really do. They have been an invaluable support to me as Prime Minister and, I am sure, to many Prime Ministers before me.
  Mr. A. J. Beith: What about the question that Butler did not answer and could not really ask, which is: how far was the Prime Minister's willingness to act on very uncertain intelligence the result of a belief that he had already formed that Saddam Hussein had to be dealt with, and a belief that, because the United States was moving inexorably towards an invasion, it was in Britain's interests to try to influence the United Nations in support of that and to be a partner in it?
  The Prime Minister: That is not what Lord Butler has found. The plain fact is that we did not go immediately to war. We went back to the United Nations to get resolution 1441. That was the whole purpose of what we were doing. One of the many things that has been exaggerated in retrospect is the idea that, when we presented the dossier, we were saying, "This is the case for war." We were not saying that; we were saying, "This is the case for dealing with this issue, preferably through the United Nations."
  As I said a moment ago, if I had thought that Iraq was a direct threat to this country, I would have taken immediate action. I did not do that, but I did think that the WMD issue had to be dealt with. September 11 meant that we could not wait around for it to materialise; we had to get out and get after it now. So that is what we did. We started with Iraq because of the history of UN resolutions. We then went to the United Nations. I believe that UN resolution 1441 was very clear: Saddam had to comply fully and totally. Through all the conversations that I had with Hans Blix, he never once suggested to me that Saddam Hussein was

  1451
  complying fully. He used to say, "Well, he's co-operating a bit", and I would say, "That's not enough", and he would say, "Well, you know—". Then came the argument that we should give him more time, and I said, "Okay, let's give him more time, but tied to an ultimatum. If we don't tie it to an ultimatum, he's never going to do it." That is why the decision had to be taken on 18 March, as opposed to some weeks later, as it could have been if an ultimatum had been agreed to. France and other countries made it clear that, whatever happened, they would issue no ultimatum. That was their decision, but it meant that, on 18 March, we were faced with either another UN resolution that would have been meaningless, or taking action. That is what we did.
  Mr. Speaker: Order.
  Several hon. Members rose—
  Mr. Speaker: Order. I say to any Members who are complaining that Back Benchers have had half an hour.
  Harry Cohen: On a point of order, Mr. Speaker. You will note that many Back Benchers on both sides still have questions to ask the Prime Minister. You have been in the House a long time, as have I, and you will know that it was the practice, certainly of past Governments, whenever legitimate questions were tabled for written answer, to say, "I refer the hon. Member to the statement that was made on this issue" and to give that as a reason for not providing any further answers. If that happens in regard to the statement that the Prime Minister has just made, will you have a look at the matter, to ensure that any further legitimate questions that are tabled get a proper answer?
  Mr. Speaker: As always, the hon. Gentleman helps me out. This gives me an opportunity to say that a Committee of the House recommended to the Speaker that an hour should be given for statements. Because of the circumstances of this statement and the fact that the Prime Minister, the Leader of the Opposition and the Liberal Front-Bench spokesman took longer—I make no criticism of them for that—I gave exactly half an hour for Back Benchers' questions. As to questions being answered, I have said to the hon. Gentleman before that I am not responsible for the quality of ministerial answers. I thank the hon. Gentleman again.

  Public Expenditure
  Motion made, and Question proposed, That this House do now adjourn.—[Margaret Moran.]
  2.46 pm
  The Chief Secretary to the Treasury (Mr. Paul Boateng): The spending review announced by the Chancellor on Monday drew the dividing lines and gave a choice for Britain between this Government and the Opposition parties. The choice is between investment in security, law and order, or cuts; economic stability and investment in science and innovation, or cuts; and a future for our public services, or cuts, charges, privatisation and a return to the under-investment in our infrastructure that characterised the Conservative party in Government.
  This Government are in a position to invest more, not less, in public services and in those areas that will enable the UK to grow and to prosper in the global economy of the future. We are in a position to do this because the savings that this Government are making on debt interest and unemployment—the two great costs under the Conservatives—allow us to meet our fiscal rules, keep taxes low and spend more on vital services. We have cut the costs of unemployment and the national debt. Together, they now consume just 2.3 per cent. of national income—as opposed to 4.6 per cent. in 1997—and net borrowing is only 2.4 per cent. of gross domestic product and falling over the forecast period. Both are lower than in the past and lower than in our major competitors in the industrialised world.
  Because of the tough decisions that we have taken to secure economic stability, we have maintained stable and sustained growth, combined with the lowest inflation for 30 years and the highest levels of employment in our history. That is a far cry from the Britain under our Conservative opponents. That Conservative Government were first in and last out of the world downturns. That Britain suffered two of the deepest and longest recessions since the war. That Britain also had inflicted on it by a Conservative Government 3 million unemployed, interest rates at 15 per cent. and in double figures for four years, 1.5 million in negative equity and 250,000 repossessed homes. That was the Britain of our Conservative opponents.
  Because of the economic stability that we have put in place, because the public finances remain sound and on track to meet the fiscal rules, and because we have held strictly to the discipline of the total spending envelope, we are in a position to raise departmental spending from £279.3 billion this year to £301.9 billion next year, £321.4 billion the year after, and £340.5 billion in 2007–08. In this spending round, three quarters of the spending will go to vital, front-line services, so while overall spending in 2006–08 will grow by just 2.8 per cent., departmental spending on vital services will have a real terms rise of 4.2 per cent. over the next three years.
  Mr. Peter Pike: My right hon. Friend is making many important points. Is it not a fact that the 18 years of Conservative rule created problems in towns such as Burnley, which only this Government, with the housing renewal pathfinder project and neighbourhood

  1453
  wardens scheme, have begun to tackle? Certainly, places such as Burnley will recognise what Labour has done for them over the last few years.
  Mr. Boateng: My hon. Friend, who served his constituency so well for so many of those Conservative years, and who made that case on so many occasions in the House from the Opposition Benches, makes an absolutely true point: cities and towns such as Burnley suffered degradation of their infrastructure, under-investment in schools and under-investment in health, which this Government have turned around. Under the spending plans unveiled by my right hon. Friend the Chancellor on Monday, we will continue to turn that around, with increased investment in health and education, but going beyond that in ways that we will no doubt explore during this debate.
  As the Chancellor said in his statement on Monday, resources have been, and will remain, linked to reform. We are committed to maximising efficiency within the public sector and to reducing administrative costs, while continuing our ambitious programme of public service delivery. We recognise that we have a duty to ensure that public money is spent efficiently, securing value for all. Therefore, on the basis of the evidence drawn from Sir Peter Gershon's rigorous 12-month review, and over and above our economic stability, growth and strong public finances, we have announced efficiency savings that will free up more than £20 billion a year by 2008. That will mean even more resources going from backroom functions to front-line services.
  Mr. Michael Fallon: The Chief Secretary says that he is committed to greater efficiency. Can he explain why the administrative costs of Whitehall, which he inherited at 4 per cent., have gone up in every single year in which he has been in government?
  Mr. Boateng: The hon. Gentleman makes a profound error in that intervention as the percentage is now falling, and will continue to fall to 3.7 per cent. of total spend. Let us compare and contrast that with 5 per cent. and more during much of the period in which the Conservatives had stewardship of the economy. That is perhaps not his strongest point as, on reflection, he would be happy to admit.
  Mr. Kenneth Clarke: The right hon. Gentleman gave a figure, which startled my hon. Friend and I, that costs were falling to 3.7 per cent. How much of that is because of the recent reclassification of quite a bit of Home Office spending and one other Department's spending, which has suddenly ceased to be classified as administrative spending and has been moved to front-line spending? Were we to keep a consistent definition, he would agree that administrative spending has been rising, as my hon. Friend suggested.
  Mr. Boateng: The point that I made clear is that as a percentage of total spend, what we are experiencing is a fall, which will be to 3.7 per cent. by the end of this spending review period. The right hon. and learned Gentleman's point, however, is one that I would be only
  1454
  too happy to explore. Although what I have said is absolutely true, and we will see that fall, he, as a former Home Secretary, will recognise that it was always nonsense to classify a group of people such as prison officers, who are very much on the front line of our criminal justice service, as in some way equivalent to those working in back offices and providing administrative services. That was a reclassification that was long overdue—I notice him nodding in consent—but it makes no difference to the figures that I have given.
  Mr. Andrew Tyrie: Will the Chief Secretary give way?
  Mr. Boateng: No, I am afraid not.
  On Monday, the Chancellor announced details of planned efficiency savings: a gross reduction in civil service posts of 84,150, and efficiency savings in local government allowing for an additional reduction of some 20,000 posts; the merged Inland Revenue and Customs and Excise, which has increased planned gross reductions from 14,000 to 16,000; a total of 20,030 civil service posts to be relocated to the regions, which has been called for by Members on both sides of the House because it brings real benefits to all those outside London and the south-east whom they represent; and a real terms fall in administration costs and plans to deliver some £6 billion in procurement savings by 2008.
  Therefore, while Conservative Members talk of fat Government, planned administration costs, which rose to more than 5 per cent. of total spending under the previous Government, will instead fall to a record low of 3.7 per cent by 2008.
  Mr. Geoffrey Clifton-Brown: The right hon. Gentleman has just reiterated the Chancellor's announcement of a very big figure that he expects to receive from savings. If he does not achieve those savings, will public expenditure be cut, or will taxes be increased to make up the shortfall?
  Mr. Boateng: The hon. Gentleman knows well that the departmental limits are set, and that we are committed to meeting our fiscal rules. We have met them, and we will continue to meet them in this cycle and the next. The sum to be released by efficiencies—£20 billion a year by 2008—will mean even more resources going from backroom functions to front-line services. I thought that he—as he usually takes a progressive outlook on those areas and is usually hot for efficiencies—would see that as a welcome commitment and one that, far from dividing us, ought to unite us on the sense that it clearly represents.
  In this spending review, not only will we continue to address past under-investment, of the sort to which my hon. Friend the Member for Burnley (Mr. Pike) referred, but we will also invest to equip Britain to rise to the new challenges of the changed global environment: internationally, through investment not only in defence but in international aid and development; and here at home, with investment in the key drivers of our current and future prosperity and in our public services.
  In contrast, the shadow Chancellor, who I am sorry to see is not in his place this afternoon, but I can well understand why because he must have rather a lot on his

  1455
  mind because the sums do not add up—[Interruption.] The hon. Member for Hertford and Stortford (Mr. Prisk), who works so hard for his party, chuckles, but he knows that the sums simply do not add up in terms of the Conservatives' spending plans—
  The Chancellor of the Exchequer (Mr. Gordon Brown): Cuts.
  Mr. Boateng: As my right hon. Friend the Chancellor says, those plans mean cuts. That is what it is all about.
  Members do not have to take our word for that. On 16 February this year, the shadow Chancellor made his position very clear. He told the Bow Group:
  "I have agreed with my Shadow Cabinet colleagues that the baseline for spending across all of these departmental budgets will be 0 per cent. growth for the first two years".
  We know what that means. I look forward to hearing any member of the shadow Treasury team say otherwise. Two years of cash-freezing departmental budgets would mean real-term cuts for every Department. Police numbers would be cut and crime would increase. Local government spending would be slashed, which would drive up council tax and force the closure of vital local services. Transport would be cut, which would undermine our infrastructure. The international aid budget—including programmes for Africa—would be cut. Defence would be cut, which would put our national security at risk.
  I paused at that point because I expected at least one Opposition Front Bencher to leap to his feet and deny that what I had said was true. They do not stir. No, I see a slight stirring—but now even that has subsided. They cannot even look each other in the face. They certainly cannot look their Front-Bench colleagues in the face, because they have all complained about the impact of the shadow Chancellor's words on their own budgets. We can well understand why.
  Let us explore the reasons for the element of confusion and chaos among Conservative spokespersons about their spending plans. We will invest more in the security of our nation. There will be a real-terms increase in the budget for our armed forces from £29.7 billion this year to £33 4 billion by 2007–08, to support their commitments abroad and to enable us to modernise and adapt our defence to meet the threat posed by the rapidly changing global security environment.
  Mr. Tyrie: Will the Chief Secretary tell us by how much the Government intend to cut defence in real terms?
  Mr. Boateng: We are providing a real-terms increase of some £3.7 billion by the end of the spending review period. It beggars belief—or perhaps it does not—that Conservative Members cannot distinguish between a cut and growth.
  Mr. Gordon Brown: Perhaps the hon. Member for Chichester (Mr. Tyrie) will read out the figures.
  Mr. Boateng: Yes, perhaps the hon. Gentleman would like to share the figures with us later in my speech, or perhaps he would like to make a speech of his own. The
  1456
  fact is, however, that the Conservatives would cut defence, while we are increasing our commitment to provide resources for the armed forces.
  We are also increasing investment for security at home. Spending will have risen from £950 million in 2001 to £1.5 billion this year, and £2.1 billion by 2007–08. That is an annual real-terms rise of 10 per cent., which will go towards modernising our homeland security, our counter-terrorism efforts and our intelligence. Under the Conservatives, defence would be cut by £2.6 billion. We do not hear a word. No one is denying that that would be the result of the Conservatives' policy. Their silence says it all. Their silence signifies consent. The reality of Conservative policy is a defence cut of £2.6 billion.
  We will invest more in our communities as well, in order to tackle crime and the cause of crime. That will be matched by investment to make our communities safer and stronger. There will be more investment in law and order, including resources to create a new National Offender Management Service, a new serious organised crime agency, and a reformed charging and sentencing system. We will invest in community support officers and neighbourhood wardens. The Conservatives would cut Home Office resources by £1.6 billion. Again, we hear no word of denial.
  Mr. Dominic Grieve: We intend to increase the size of the police force by 40,000 officers. We have shown how that can be done within the financial constraints. I should like to ask—[Interruption.] I am asking a question. This is an intervention, not a speech. I should like to know whether the Government intend to go down the same road as us.
  Mr. Boateng: Talk about brass neck! It is this party that has increased the number of police officers by some 11,000 since taking office. It is this party that proposes to increase the number of community support officers. It is this party that is increasing the number of neighbourhood wardens. It is the Conservative party that will cut Home Office resources by £1.6 billion—and now Conservative Members pluck from the air a figure by which they say they will somehow increase the police force. It simply is not credible.
  Mr. Grieve: While we are on the subject of the Home Office, let me say that while looking at the claims for the future contained in the spending review, I noticed the claim that the Government would continue to reduce illegal immigration. As the Government have never given us a figure for illegal immigration and have never even deigned to give us an estimate, how can we judge whether that policy objective will be met?
  Mr. Boateng: I am afraid the hon. Gentleman has missed the point. It was for him to explain in his intervention how he would do more with less. We are happy to explain, on the basis of our record, what we have done to increase the number of police officers. We are happy to explain, on the basis of our record, what we have done to make our borders more secure and what we have done to make the long-awaited investment in the immigration and nationality directorate—a division of the Home Office that was shamefully neglected under

  1457
  the Conservatives. We have reversed the decline of the IND, and strengthened our borders. Customs and the immigration service are working ever more closely together. The Conservatives would cut the Home Office budget by £1.6 billion. Not one of them comes to the Dispatch Box to deny that.
  We will do more. We will continue our long-term investment in our infrastructure, particularly transport and housing. The housing budget in England will rise from £5.9 billion this year to £7.2 billion by 2007–08, a 4.1 per cent. annual real-terms increase. That will fund a major programme of investment in affordable and social housing. It will tackle the long-term under-investment in and neglect of housing that characterised the Conservatives' stewardship of the economy, and promote the housing that is vital to both our economic prosperity and the quality of our lives.
  To deliver further reforms in the rail industry and on our roads, the transport budget will rise faster than was originally planned. By 2008, transport spending will be 60 per cent. higher than it was in 1997. In contrast, the economic judgment of the shadow Chancellor—who is still not present—is to cut investment in our transport infrastructure by £1.8 billion. That, I might add, is against the advice of both the Confederation of British Industry and a broad cross-section of representatives of British business.
  The Conservatives are never able to explain how it is possible for them to have a policy that is designed to promote economic prosperity—so they say—while cutting the very transport infrastructure upon which such prosperity so obviously depends. Rather than freeze budgets, which is the Conservatives' policy, we want to secure balanced economic development in every region, and to tackle regional weaknesses and build on regional strengths. Funding for regional development agencies will therefore rise from £1.8 billion a year to £2.3 billion by 2007–08. In addition, we have announced that, as with central Government Departments, local authorities will for the first time have three-year budgets that allow more effective long-term planning at local level.
  So rather than cutting investment, we will invest more in our children and build on our improvements to the education system. That will include a new determination to make pre-school provision available to the under-fives, as well as making child care available to all. As my right hon. Friend the Chancellor said on Monday, this Government are determined to equip Britain for the global economy of the future. To do this, we published alongside the spending review a 10-year investment framework for science and innovation, the aim being to make Britain the best location for science and innovation in the world. We will not cut science funding, but will increase it in real terms by an annual average of 5.8 per cent.—a doubling of cash spending on science since 1997. We have also set ourselves the ambitious target of raising overall research and development spending in the private and public sectors from 1.9 per cent. of national income to 2.5 per cent. by 2014.
  The choice is clear: Labour investment that is built on the strength of our economy, or Tory cuts and privatisation. This spending review seeks to invest, in an uncertain world, in law and order and security and
  1458
  defence, in order to protect our citizens at home and our interests abroad. It also seeks to meet our global responsibilities to others by investing in international development and in the achievement of the millennium development goals. It seeks to secure and maintain the stability and growth of the economy and to invest in the education, skills, science and innovation that will drive our future growth and prosperity. It further invests in our vital health service and transport infrastructure, thereby increasing the well-being and prosperity of individuals, as well as delivering for UK business.
  The choice is stark: a stronger economy and a stronger Britain with billions of pounds more invested in housing, science, transport, defence, national security, skills, safer communities, sport and children; or billions of pounds of cuts in security, infrastructure, law and order, science and local government, and a return to a Britain of economic failure. That is the choice that my right hon. Friend the Chancellor set out for the nation on Monday, and which we will debate today. I have no doubt which option this House and the nation will choose. They will choose Labour and economic success, rather than the Tories and economic failure.
  3.13 pm
  Mr. Howard Flight: The central challenge for all mature economies today is to improve the efficiency of their public sectors in order to achieve better delivery of public services and better value for taxpayers' money. In the light of an ageing population and rising demand for public services, unless that challenge is met the growth of the productive economy will be reduced, and with it the long-term ability to sustain provision of public services. As British experience under the current Chancellor has demonstrated, just turning on the spending taps does not work. Higher taxes and an ever-expanding public sector crowd out the productive economy and reduce long-term economic growth.
  The real dividing line between the Conservative and Labour parties is our genuine commitment to improving public sector efficiency, downsizing the bloated Government that the Chancellor has created, and devolving power and responsibility to those at the sharp end who deliver public services—instead of seeking obsessively to micro-manage them—versus the sham of this Government, who have no intention of making the real reforms that are needed. As my right hon. Friend the shadow Chancellor pointed out so eloquently on Monday, Britain now has a fat—indeed, an obese—Government, and most of the extra spending has been absorbed by public sector inflation. That is the result of greater bureaucracy; more unproductive employees; failing and distorting targets; more initiatives, quangos and task forces; and greater regulation and centralisation.
  The issue is not just the public sector in the traditional sense of wrong decisions, bad management, lack of controls and poor project management—issues that were ably investigated by the National Audit Office and

  1459
  the Public Accounts Committee—but the inherent expense and ineffectiveness of a bloated, command-and-control Government.
  Mr. Boateng: Will the hon. Gentleman confirm that the Conservatives would cut public spending first to 35 per cent. of gross domestic product and then to 30 per cent.?
  Mr. Flight: It is perhaps time that the right hon. Gentleman grew up a little. That intention has never been indicated and, as he has just argued, the one commitment that the shadow Chancellor has given is to prevent public sector expenditure from rising to 42 per cent. of GDP, and to restrain it to 40 per cent.
  On defence, the Chancellor and the shadow Chief Secretary had better go back to school and learn their arithmetic—
  Mr. Gordon Brown: You are the shadow Chief Secretary.
  Mr. Flight: I am sure that it is not in order for even the Chancellor of the Exchequer to interrupt from a sedentary position.
  The Government's figures in the 2004 spending review show that their planned increase, in cash terms, for defence expenditure is 1.4 per cent. per annum. I was not aware that, even under his new consumer price index formula, the Chancellor was forecasting inflation of less than 2 per cent. [Interruption.] In cash terms, 1.4 per cent. set against 2 per cent. inflation is a reduction in real terms. In due course, I shall ask the Chief Secretary whether he is happy with the defence procurement record, whether he feels that good value for money has been achieved, and whether he thinks it appropriate that the number of civilian defence employees should be approximately the same as the number of front-line fighting forces.
  Mr. Andrew Love: The hon. Gentleman referred to the speech that the right hon. Member for West Dorset (Mr. Letwin) made on Monday, and I shall paraphrase it by asking the following question. Does the hon. Gentleman agree that, according to the position adopted by the Conservatives, if they intend to waste less they must spend less?
  Mr. Flight: Our position is that we will spend much better, and I have a great deal to say on how to achieve that. But before so doing, I should point out that this Government have increased public expenditure by some 63 per cent. in cash terms. As the National Audit Office reported, there has been a 54 per cent. increase in expenditure on public sector goods and services since 1997, but that has produced only a 12 per cent. increase in measured outputs. It is time that the Government learned to focus on outputs, rather than on spending.
  The national statistics deflator shows that public sector inflation has risen from 1.6 per cent. when the Conservatives left office in 1997 to 10 per cent. today—a record of which I am sure the Chancellor is proud. Total spending on the NHS has risen by some 37 per cent., but hospital activity measured by finished consultant
  1460
  episodes rose by only 4.8 per cent. in the three years to 2002. While NHS spending has gone up by more than 50 per cent., productivity has declined by more than 15 per cent. since 1997. Indeed, overall productivity in the public sector has declined in the last three years by 10 per cent. No wonder the Government have tried to rig the figures.
  As a Labour Trade and Industry Minister recently told a conference on regeneration in Philadelphia:
  "Too often, a lot of money has been spent, but very little seems to have been achieved … In a year or so, we are going to have an election in the UK when people will say we have paid a lot of taxes but what has been achieved with all that money?"
  We now have a public sector in which the bureaucrats and administrators in all the Government-created units, boards and panels devise the heavy-handed regulations and set the conditions of the specific grants in order to implement the initiatives so that targets can be monitored by inspectors in the overgrown layers of Government that control central and local activity, administer over-complex taxation, organise the systems of dependency, constrain the choices of the consumer and end up by disempowering the citizen.
  Public sector employment has risen by some 10 per cent.—509,000 jobs since 1998—and an extra 350,000 public sector employees are planned over the next three years. Last year, 162,000 new jobs were created in the public sector while the private sector lost 98,000. The civil service is now the size of Sheffield; more than 5,000 new civil servants were hired every week in 2003. For every extra police officer, virtually one more bureaucrat has been employed in the Home Office, and the number of tax collectors has increased almost twice as fast as the number of doctors and nurses. Without the discipline of competition, that is essentially what happened in the nationalised industries, and the Chancellor has actively encouraged it across the public sector.
  Mr. Boateng: The hon. Gentleman's dislike of public service, the public sector and public sector workers is well known. Does he not accept that for every administrator employed in the NHS since 1997 there are six doctors and nurses? Does he not accept that if we examine outcomes in the NHS, we find that chronic heart disease mortality is down 20 per cent. and cancer mortality down 8.6 per cent. in the under-75s? All of that is a product of having a Labour Government since 1997. Has the hon. Gentleman not a word of praise for those public sector workers who have delivered those results and who have been helped by the targets and extra resources that he would take away?
  Mr. Flight: It is about time that the Chief Secretary spoke to some people working at the sharp end in the NHS. I have every sympathy and support for those people, toiling under the distorted regime of targets introduced by the Government. I suggest that the Chief Secretary, rather than quoting selectively, looks at the overall ratio of increased expenditure versus increased outputs.
  As William Keegan's book on the Chancellor—I am
  glad that he is in his place to hear it—points out, the Chancellor realises that his Achilles heel is that the electorate will perceive that his major increases in tax and spending have in the widest sense of the word been wasted and that he has failed to deliver. In order to head

  1461
  off such criticism, the Chancellor introduced public service agreements in the 1998 comprehensive spending review to set out what public sector improvements were to be achieved from the additional spending.
  The reality, as the Chancellor knows, has been failure to meet most of the targets. The volume of targets and the rigid centralised structures accompanying them have stifled local initiative, diminished professional responsibility, distorted priorities and diverted time and attention away from the task of improving the public services. It is analogous to the Chancellor's fake savings announced on Monday. The target regime was merely a substitute for real public sector reform.
  Last year, as the Chancellor will be aware, a paper was produced for the European Central Bank. It compared the more efficient public sectors around the world, particularly Japan and the USA, with those of other countries. It found that to maintain output, UK public spending would need to be only 84 per cent. of the actual total spent if the public sector were as efficient as the best. Put another way, if the UK were as efficient as the best and maintained its current spending levels, output would be 25 per cent. higher. Effective reforms of the public sector need to focus on outputs rather than on spending, and to remove costs and activities that actually achieve little or nothing.
  That is the context of the Conservative party asking David James and his 60-man team to investigate and address in a bottom-up review each area of public expenditure. [Interruption.] I suggest that the Government would do much better if, rather than making inane remarks, they reflected on the advantages of that approach over their Gershon approach and carried out a proper analysis of where the inefficiencies really lie. They need to know where things are going on that achieve little or nothing. As part of a process that we started more than a year ago, over the next few months we will present in major policy announcements the efficiency savings that should be made. We will present them in a way that stands up, unlike how the Chancellor presented his proposals on Monday.
  The main precedent for establishing how to improve public sector efficiency has been the national partnership for reinventing Government in the US. It started by recommending more than 1,200 specific changes to make government work better and cost less, of which two thirds were implemented. It then focused on transforming the culture in the major Government agencies with the most public contact to be results-oriented, performance-based and customer-focused. It also addressed the scope for new technology to improve public sector efficiency. It succeeded in reducing the size of the federal civilian work force by nearly 500,000. Action on more than two thirds of the recommendations resulted in savings of approaching $140 billion.
  Government was downsized the right way by eliminating what was not needed—bloated headquarters, layers of managers, outdated field services and obsolete red tape and rules. It succeeded in cutting 640,000 pages of internal agency rules and eliminated 250 agency programmes. Of great ongoing importance, it introduced annual performance reports, required under the Results Act. All Government bodies in the US are subject to regular operational efficiency, as
  1462
  well as financial audit, assessing whether the structures and processes in place in each Department and area are the most efficient and effective for carrying out their objectives.
  Major improvements in the US public sector have also resulted from the creation of FirstGov, a one-stop website for Government information transactions, programme results and e-mail feedback to public officials, with connections to 27 million web pages.
  In that context, we have welcomed the Government's Gershon initiative as a start. Gershon's cross-cut analysis of areas offering opportunity for efficiency saving is sensible as a starting base and useful as far as it goes, but the fundamental weakness is that the Government have failed to address how to implement the type of efficiency saving measures that Gershon recommends. The immediate shortcoming is that Ministers and civil servants have resisted reform in their territories. The existing huge infrastructures with strong vested interests outweigh the transitory and limited resources employed to implement change and reform.
  I presume that the Chancellor and the Chief Secretary are aware that there is currently no valid way to measure desired Government outputs. Gershon also addresses only limited territories in the cross-cutting proposals on which he has focused. He does not address the culture problem of fat government—the culture of regulation, initiatives, targets, grants, panels, boards, tsars and inspectors. That culture has increasing layers of Government bureaucrats and administrators, and of complex and intrusive taxation. It involves widespread dependency on the slate and restricted choices for the consumer.
  Throughout the public sector, the ratio of back-office costs to front-line services is far too high in comparison with private-sector service industries. Much more decentralisation of operational responsibility is needed to improve front-line services. That is one of the main objectives of Conservative policy, and of our aim to give citizens greater choice in health care and education.
  Gershon gives no explanation for the limited number of areas that he investigated other than that they might offer the greatest potential for efficiency improvements. His report does not question whether many areas of expenditure are needed at all. Essentially, it seeks to determine whether some costs can be shaved off some areas. That approach ignores the potential for other major efficiency savings.
  Gershon's time span is also too slow, and he hardly mentions the potential efficiency improvements and savings from outsourcing, except to say that they are typically of between 20 per cent. and 30 per cent. Although he is right to indicate the need for greater use of e-government, the potential in the UK remains restricted by the fact that a large proportion of the population in receipt of Government benefits does not use, or have access to, the internet. Moreover, Gershon seems to ignore the efficiency potential offered by the much greater use of technology within Government. That can yield large benefits speedily, as has happened in the US. Business best practice is to increase significantly the spans of control—that is, the numbers
  of people managed by one person compared with the practice of the recent past. Gershon does not address that territory.

  1463
  Gershon's proposals for procurement efficiency saving are confined to centralised bulk buying, but they ignore the potential for improvement at local levels. Such an improvement was recently implemented successfully by Norfolk county council, which has saved some 25 per cent. of its procurement costs. His proposals for streamlining back-office functions are also unlikely to deliver without the discipline of outsourcing. He focuses on efficiency savings available from downsizing both private and public policy funding and regulation. He rightly points out that the cost of compliance to business is many times greater than to Government. However, a bolder Approach to both is capable of securing savings of at least £2 billion a year more, and in a shorter time.
  Mr. Boateng: The hon. Gentleman began by praising Sir Peter Gershon, and then proceeded to rubbish him at length. He accused Sir Peter of not taking into account the efficiency gains that can come from local government. Has he actually read the Gershon report? I refer him to page 55, where Sir Peter states:
  "Local government has a key role to play in this ambitious agenda, and many local authorities are already securing efficiency through investment in technology and rationalisation of back office and procurement functions."
  That certainly includes the Norfolk example. Sir Peter has done the very thing that the hon. Gentleman accuses him of not doing. Will he withdraw his ill-advised and misplaced comment?
  Mr. Flight: The Chief Secretary points out one sentence, but he does not refer to anything in Gershon that sets out how those improvements can be achieved. Gershon merely observes what has happened, and that is quite different from his cross-cut comments about centralised buying.
  At last year's spending review, the Chancellor stated:
  "In each area of service delivery from housing to education, from policing to defence, we are tying new resources to new reform and results, developing a modern way for efficient public services".
  He also said that
  "we have a special duty to ensure that public money is spent wisely and efficiently and we are as determined to secure value for money as we are to secure money for our services."—[Official Report. 15 July 2002; Vol. 389, c. 22, 25.]
  He said roughly the same thing about the 1998 and the 2000 spending reviews. He has failed and failed to secure value for money.
  The truth is that the Chancellor has engaged in a pre-election public spending spree, creating bigger and bigger Government, based on bigger and bigger borrowing and rising taxes, which will produce big problems for the future and require a major increase in taxation if Labour were to win another election. In recent weeks, the Governor of the Bank of England has warned not only that the housing market has become overheated, but that the public sector spending spree is causing the economy as a whole to overheat. The Chancellor shows no signs of heeding that warning.
  Mr. Boateng: The hon. Gentleman accuses my right hon. Friend the Chancellor of engaging in a pre-election spending spree. Would he care to reflect on the words of the director general of the CBI—[Interruption.]
  1464
  Opposition Members say "Huh," but Digby Jones presumably speaks with greater authority on the views of British industry than any of them. He said:
  "Mr. Brown has taken a big step in the right direction. Companies will breathe a sigh of relief that growth in public sector investment is not going to become profligate pre-election spending."
  Those words are totally contrary to the claims made by the hon. Gentleman. Whom should we believe—Digby Jones, who speaks for British industry, or—
  Madam Deputy Speaker: Order. The hon. Gentleman has got the Chief Secretary's point.
  Mr. Flight: I am delighted to note that my point has hit home. If the Chief Secretary were to read most of the economic comment, he would find my point being made. As I have just pointed out, the Governor of the Bank of England has warned the Chancellor that the extent of public sector spending is causing the economy to overheat.
  The Chancellor and the Chief Secretary may try to speak the language of efficiency and of Gershon, but they are faking it. On closer analysis, many of the reductions are bogus. Bureaucracy has not been slashed: in just a single week at the end of June and the beginning of July, another 584 new jobs were advertised in the public sector, with a combined annual salary bill of £22 million. Salaries on offer included £74,000 for a new head of tourism sponsorship in the Department for Culture, Media and Sport and a whopping £130,000 for the chief executive of the Government education quango, Learndirect. On an annualised basis, that level of recruitment would add a further 30,000 jobs and more than £1 billion to the wages bill.
  As The Times has commented, it was said of the Holy Roman empire that it was not holy, not Roman and not an empire, and likewise, the comprehensive spending review is not comprehensive and not a review, but an intensely political exercise, better termed "the big spend".
  The public sector is now larger than Scotland. Whatever the Chancellor may say this week will not change anything, because he cannot give up his obsession with trying to manage and control everything from the centre—his only alternative to having the power of the Prime Minister. It is the medium and long-term economic damage caused by the Chancellor's big Government that is of the greatest concern.
  The legacy inherited by this Government did not consist only of tightly controlled public spending, a greatly reduced bureaucracy and a public sector current balance. It also, and more fundamentally, consisted of an economy much more vibrant and better placed to compete than at any time in Britain's recent history. Taxes were lower, and regulation was lighter. Huge and profitable businesses had emerged from the ashes of failing nationalized industries. Britain's productivity growth rate was on a par with other major industrial competitors. Britain's household savings rate was respectable by international comparison, and we were fourth in the international competitiveness league. Now we have dropped to 15th and our productivity growth and savings rates have virtually halved.
  The foundations of our economy are being eroded by over-regulation, over-taxation and excessive government. The vitality of the British economy has

  1465
  been increasingly smothered. According to figures from the Organisation for Economic Co-operation and Development, the UK public sector now accounts for more than 42 per cent. of national output, making it the largest state sector in the Anglo-Saxon world, where our growth rate is now the lowest.
  In the long-awaited Gershon report, there is also a gaping lack of credibility as to how to deliver the suggested efficiency savings. The Chancellor's announcements on Monday added a further seven agencies and cooked the figures on civil service reductions. We need to cut away layer after layer of unnecessary government activity and layer after layer of bureaucracy. We need to remove swathes of regulation instead of continuing to add to them. That is the brief of the David James review.
  The next Conservative Government will take office with more comprehensive plans for downsizing bloated government than ever before in our history. That Government will require overall adherence to our medium-term expenditure strategy and the progressive reduction of the proportion of our GDP consumed by the state in order both to eliminate the structural deficit that the Chancellor knows he has created at a time when the economy is at full capacity and to prevent the massive increase in taxation that would be required if Labour secured a third term.
  Our objective is to give Britain smaller government that does less but does it better and a more vibrant and competitive economy, which alone can sustain first-class public services in the long term.
  3.41 pm
  Mr. John McFall: I welcome the Government's spending review, especially the commitment to public services. I think that I speak for all Members on the Labour Benches when I welcome the extra 2,500 children's centres to be set up by 2008 and the extra £2.1 billion to tackle crime. Following the Barker review, an extra 50 per cent. will be invested in social housing, where we have described the situation as a scandal. As a scientist, I welcome the indication that £1.5 billion more will be spent on science and research in 2008 than in 2004—05.
  The dividing lines for the next general election are clear. The Labour Government promise higher, better-quality public services. On the other hand, the shadow Chancellor, in his speech on 16 February outlining the Conservatives' medium-term expenditure strategy, said:
  "I have agreed with my Shadow Cabinet colleagues that the baseline for spending across all of these department budgets will be 0 per cent. growth for the first two years."
  The electorate will find that the Conservatives will not be spending on defence at a time of increased terrorism and insecurity; they will not be spending on crime at a time when we have to bear down on that problem; and they will not be spending on education when we need extra skills so that more young people can enter the work force.
  The Government have said that we must match investment with reform. I agree, but we must cast a critical yet constructive eye over the plans. Sir Peter Gershon advocates public sector efficiency goals of 2.5
  1466
  per cent. over the next three years and efficiency gains of £20 billion in front-line services by 2007–08. As has been said, that will require the loss of 84,000 civil service posts and the relocation of 20,000 posts away from London. In his foreword to the efficiency review, Sir Peter stated that
  "this will result in a significant loss of employment opportunities over a relatively short period. It is important that these reductions are managed well both for the individuals concerned and to sustain the commitment and motivation of the whole Civil Service in light of the invaluable functions it performs".
  What discussions about those reductions have taken place with staff? How are staff savings on that scale possible? Will the Minister provide a regional breakdown of the proposed staff cuts?
  The history of such efficiency savings does not leave much room for comfort. Civil service numbers have exceeded Treasury plans in every set of annual public spending projections since 1999. For example, if the plans published by the Treasury in May 2002 had been achieved, there would be 45,000 fewer civil servants than now. The Rayner scrutiny, the financial management initiative, market testing and Executive agencies have all been trumpeted as major sources of efficiency savings. Each of them promised £500 million in savings, but they resulted in the delivery of less than 50 per cent. of those savings. Those schemes are dwarfed by the Gershon review, so it is important that we have a transparent process to follow the progress and to introduce the recommendations sensitively. Many of the people in the posts that will be lost are relatively low earners. A number of my friends in my constituency have worked in the Department for Work and Pensions for 12 or 15 years. Their earnings are £17,000 or £18,000, and they are married people with children, so it is important that the consultations are sensitive and done properly.
  I also note that the Lyons report asked for jobs to be moved from London, but again, I suggest to the Minister that we must ensure that we act more efficiently in such cases. I bring to his attention the DWP pensions centre in Liverpool, where more than 300 civil servants will lose their jobs on Merseyside. That news comes just three months after the Lyons report recommended that extra civil service jobs should be moved from London to Liverpool. The pensions centre in Breckfield only opened in December 2002 and the 316 staff deal with inquiries and claims for the state pension credit, but we now find that the plans that were trumpeted in December 2002 have been revised. That does not augur well for the efficient use of resources by the DWP and I look to the Minister and, indeed, the Chancellor when he appears before the Treasury Committee tomorrow, to answer those points.
  It is appropriate to consider the golden rule because the spending review is taking place against a background of increased deficits in the public finances. We have to ask whether the spending commitments are affordable if the Chancellor is to stick with his fiscal rules. How much margin for error against the golden rule does the Treasury have if the public finances turn out worse than expected? We can refer to tax receipts on that issue. The forecasts in the 2004 Budget assumed an ambitious rise in receipts from 37.8 to 38.7 per cent. of GDP, but last year's out-turn—37.6 per cent.—caused our current receipts to be £1.6 billion lower than

  1467
  expected. Tax receipts could surprise us on the upside, particularly if the economy grows rapidly this year, but if so, the output gap will become an issue.
  Evidence that the Treasury Committee took from the Governor of the Bank of England and others shows that the output gap is narrower than expected this year, so meeting the golden rule will be harder to achieve, with growth running faster than trend. The Treasury indicated a 3 to 3.5 per cent. growth rate in the Budget. We have also seen increased employment in the labour market. Although those figures are positive, they put pressure on the output gap. Is it the case that the output gap will be eliminated by this summer—a year earlier than indicated in the Budget? The Treasury Committee will examine the Chancellor on that question tomorrow and in the future.
  May I make a point about the time scale of the spending review on behalf of the whole Committee? We are dealing with an enormously compressed schedule and I question whether that adds to the scrutiny of the exercise. For example, the public expenditure out-turn White Paper will not be produced until next week, yet such information is needed to gather the full picture. The Atkinson review on public sector output, productivity and associated prices has not yet been published. Given that it will focus on whether growth and spending have fed through into increased output and improved services, it will be important when we examine the spending review. I make a plea to the Minister—I shall also raise the matter with the Chancellor tomorrow—for adequate time to examine spending reviews adequately.
  The Treasury Committee held two meetings this morning with Treasury officials and our experts. The aim of Select Committees is to ensure that there is an informed debate in the House, so a Select Committee report should be available for hon. Members to debate and to help them with the process. We will take evidence from the Chancellor tomorrow, but given our other commitments, we will not produce a report on the matter. That represents an omission, and it is due to the time scale that the Treasury and the Chancellor have imposed. I ask for that lesson to be taken on board so that we may have a decent amount of time to examine reviews in their entirety—I cannot stress the importance of that enough.
  One aspect of the spending review that has received little publicity is the establishment of the financial inclusion fund, which I welcome greatly. The Treasury Committee will examine financial inclusion over the coming months. Almost 7 million people are currently financially excluded and, in today's society, people who are financially excluded are also socially excluded. I wait with interest for the Government's development of the fund.
  The Opposition have made several vigorous points against the Government, but it is important for an Opposition to have credibility and sound judgment. When I read the Sunday papers this weekend, I was appalled to discover that the shadow Chancellor would abolish the Financial Services Authority.
  Mr. Flight: I, too, was appalled to read the headline. If the right hon. Gentleman had read the story, he would have realised that the headline was completely stupid.
  1468
  My right hon. Friend the shadow Chancellor made it clear that the FSA was over-burdened with the requirements of law and the Treasury, and that that was arguably leading to over-regulation, but nothing was said about abolishing the FSA—that is not our intention.
  Mr. McFall: I take it from the hon. Gentleman that although there has been an absence of clarification from Tory Front Benchers over the past few days, the Conservative party is committed to a single regulator—the FSA.
  Mr. Flight: I can confirm that.
  Mr. McFall: It was rather unfortunate that the headlines went well beyond that, so the hon. Gentleman's clarification was useful.
  The shadow Chancellor has claimed that official statistics are politicised, but he should apologise for saying that. He made a personal attack on both the head of the Office for National Statistics, Len Cook—he appears before the Treasury Committee and sometimes feels a bit traduced by us—and Tony Atkinson.
  I note that the Cabinet Secretary, Sir Andrew Turnbull, wrote to the shadow Chancellor on 27 April, saying:
  "there has not been any political interference with official statistics"
  and
  "the suggestion that the important work being done by a figure of Sir Tony Atkinson's stature is being used for political ends is untrue and deeply unhelpful."
  The shadow Chancellor has been personally assured by Len Cook that the work that the ONS and Sir Tony Atkinson are carrying out to improve current measures of productivity is completely independent. He was also told by Len Cook that any changes would be subject to peer review and in line with international guidance and the national statistics code of practice.
  The hon. Member for Arundel and South Downs (Mr. Flight) could do two things. He could confirm that the shadow Chancellor will apologise for those personal remarks and ensure that we have both integrity and soundness of judgment when we scrutinise the work of figures such as Len Cook, Tony Atkinson and the ONS staff.
  Mr. Flight: I understand that the shadow Chancellor had a conversation and meeting with Len Cook and the misunderstandings have been sorted out.
  Mr. McFall: So I take it that a private apology has been made.
  The Chancellor has committed the Labour Government to devoting 0.7 per cent. of national income to international development by 2013. That is a massive move forward. We must remember that the Government have increased spending on international aid by 140 per cent. since 1997. An extra £6.5 billion will be spent by 2007–08, but there is still an awful lot of work to do.
  It is important that the signal that the 0.7 per cent. gives out is loud and clear. It should be made into a manifesto commitment. That has still to be discussed by

  1469
  the Cabinet, but I put it strongly to the Minister that that is what is needed. When the Treasury Committee visited Washington two or three weeks ago, we spoke to Mr. Rodrigo de Rato at the International Monetary Fund and Jim Wolfensohn at the World Bank. Jim Wolfensohn said that third-world countries must see the developed countries give a commitment for the future. If the 0.7 per cent. commitment were given in the manifesto, that would be of enormous benefit. It would be symbolic and help people around the world. It would also help the Chancellor's international finance facility proposals, which are appropriate.
  Hon. Members may know that the Chairman of the International Development Committee wrote to me and asked whether we could take a joint approach to our American colleagues and others to ensure that that IFF commitment is made. The United States Administration are against it, but it is important to keep lobbying and to continue the political contact between ourselves, our European colleagues and our American colleagues. The establishment of the 0.7 per cent. figure is a great step forward. Let us turn it into a manifesto commitment so that we have domestic prosperity and an international commitment for the future.
  3.58 pm
  Mr. Kenneth Clarke: This debate is the second part of the Budget. Indeed, before 1997, both the tax changes and the public spending changes for the coming year were announced at the same time in November. So this is the second arm of the Chancellor's explanation to the House of Commons of the fiscal policy that he is producing and how he intends to meet his fiscal rules. In my opinion, that is the most important thing that we should address. It is highly unlikely that the Chancellor will meet his fiscal rules. He is getting ever more ingenious in trying to disguise from the outside world what little margin he has and what he is likely to have to do after the election if he fails to comply with his golden rule and his other fiscal rules.
  At the time of the Budget, the Chancellor tried to explain how the rapidly deteriorating public finances would not lead to his breaking his golden rule. He forecast a sudden and dramatic acceleration in the collection of revenue, but he explained that that would not require a tax rise, which the public might find uncomfortable. Instead, he would stop avoidance, and there would be a dramatic rise in tax revenues over the next few years. At the same time, he said in the Budget that there would be a remarkable deceleration in the growth of public expenditure. Policy changes or diminution of the delivery of public services would not be required, as the public might find any such announcements uncomfortable. We were therefore told that 2.5 per cent. efficiency savings would be achieved over the next few years as the result of the great work of Sir Peter Gershon and his team. We are considering those proposals today, but I still doubt whether the Chancellor's tax revenues will accelerate over the next few years as he has forecast. I shall not give the House my figures, because they are different from those given by the right hon. Member for Dumbarton (Mr. McFall). We have been told that the tax take will increase more rapidly than the growth in gross domestic product, with
  1470
  particularly remarkable accelerations in the collection of corporation and income taxes, but I still fail to believe that that is the case.
  Sadly, I doubt very much whether the proposed reduction in the growth of public spending will not have any effect on Government activity. I do not accept that that slow-down can be achieved by improvements in efficiency without affecting delivery rates. Politics is not like that—policy changes are needed.
  The golden rule, which I have criticised in the past, is extremely lax and elastic. I prefer, as do the International Monetary Fund and the Organisation for Economic Co-operation and Development, to seek to balance the public budget over the cycle. However, we have a golden rule that we should borrow only to cover capital investment and never for current investment. Even if the Chancellor's figures turn out to be right, he has left himself a tiny margin for error. No one can ever get their forecasts exactly right. I remember the Labour party being amused by my remark, when I was Chancellor, that forecasts of deficits and surpluses involved such enormous figures that one had to give or take £10 billion either side. That is still true, so the Chancellor's tiny margin for error is almost incredible.
  I fear that we will carry on with the pretence of an explosion of tax revenues and a surge of public sector efficiency until the election. Afterwards, a Chancellor who has consistently denied that he will have to raise taxes will do so if he returns to office. Let us face it—that is what he did in 1997 and 2001. The public cannot say that they have not been warned if they vote Labour next year and find that the same thing happens after 2005. However, substantial reductions in the growth of public expenditure are required, but the Chancellor has not done well enough. I shall not invoke the name of the Governor of the Bank of England, save to say that I agree with my hon. Friend the Member for Arundel and South Downs (Mr. Flight). Mervyn King is, of course, independent of the Government and the Opposition—he is his own man, and I admire that. He talks in the delphic tones of governors of central banks, but his recent remarks are the closest that he has come to a warning and reproof that if we are to get mounting inflationary pressure in the economy under control and, more importantly, to maintain economic stability and consistent growth, the central bank, which is in charge of monetary policy, and the Chancellor of the Exchequer, who is in charge of fiscal policy, must pull in the same direction while they make their contribution. The Chancellor's contribution is not good enough.
  When the Chancellor made his statement on Monday, I made disparaging remarks about the consistency of his policies. He has been quite successful, I do not deny, as the British economy has performed moderately well over the past 10 years or so. He has been extremely lucky, but he has also shown the most remarkable ability to change the entire basis of his approach to policy. When he first came into office, prudence was the guiding watchword of everything he did. He applied, in a rather mechanical way, which had not been anticipated, the strict fiscal controls that he inherited, and we saw a substantial and rapid tightening of public expenditure limits.
  In 2000, or thereabouts, the Chancellor went in for a complete reversal. That came in the run-up to the 2001 election and in response to the political pressures of the

  1471
  Prime Minister in particular, and quite a few of his political colleagues. From 2000, the iron Chancellor was gone and prudence deserted, and since 2000 or thereabouts, we have had four years of spend, spend, spend, on a quite extraordinary scale.
  We are now about to enter the third phase. There has been a sudden, sharp reduction in the growth of public expenditure, and a new Chancellor of the Exchequer has emerged—a man committed to efficiency, cost control, the quality of performance, cuts in bloated payrolls and so on. I find this third phase very unconvincing and, like the first two, not adequately described.
  The key to understanding the Chancellor, which is true to a certain extent of all Chancellors of the Exchequer, is in recognising that he is, above all, an intensely political man. Here we are, with the Chairman of the Select Committee and several members of the Committee that is about to start the serious business of parliamentary scrutiny of the public accounts, and we are debating a statement about public expenditure that made some references to the public accounts, gave some indications of what was to happen and set departmental limits, but was actually political pantomime. It was entirely aimed at creating a whole new basis for debate and seemed largely aimed, and still is, at trying to have a go at the Conservative party on the basis of a slightly deluded representation of what the Conservative party is supposed to be saying instead. That does not really help us to get to what the Government are doing.
  In my opinion—again, I mentioned this on Monday
  so I will not labour the point—the Chancellor would dearly have loved to go in for another pre-election spending spree. The classic thing, particularly for Labour Chancellors and, alas, occasionally for Conservative ones, is suddenly, when the election is coming up, to start spending a lot more public money to bribe the electorate out of their own pockets, get their party re-elected and deal with the consequences afterwards.
  The Chancellor cannot do that now because he did it last time, and he is dealing with the consequences. So this time, as a pre-election stand, we have Gordon the champion against waste, the new drive for efficiency, better government, more into the front line and so on, all of which is a worthwhile sentiment, but is political sloganising. It is all based on the assessment that the public feel strongly, and quite rightly, in my opinion, that they have not been getting value for money from the increased taxation that they have been paying.
  Of course, the public services are getting modestly better. The Government cannot keep increasing spending on the health service at 7 per cent. in real terms each year without getting something for it, but most members of the public realise that they are not getting value. Gordon feels vulnerable or the subject of waste. He decides to address that, and suddenly the most extraordinary targets are set for improving performance and shifting money to front-line services.
  The Chief Secretary today and the Chancellor on Monday almost passed over the fact that the key decision was the slow-down in the growth of public spending. We have two new years being brought into the public expenditure survey. We have been told that in those two years the rate of growth of public spending will almost be halved. Departments such as the Ministry
  1472
  of Defence will unarguably see their spending as a proportion of GDP reduced as a result of the announcement. New Labour has never seen anything like it. If they get themselves re-elected, some of the more veteran Members may be reminded of the first two or three years, when the figures began to dawn on them. They are entering a new world of a marked slow-down of public expenditure. I seriously doubt whether anything of that kind, although desirable in principle, can be achieved so dramatically and so quickly without policy changes to improve efficiency. With the greatest respect, anyone who has been in this House for any length of time has heard hon. Members from all political parties try to square the circle on how they will constrain the cost of their policy proposals by saving on waste and increasing efficiency. I can see hon. Members on both sides of the House who have held the responsibility of office, some at national level and some at local level, and none of us believes it. We should learn from experience and realise that more must be done.
  That is not to disparage Sir Peter Gershon's work. I have praised him and, although I do not know him well, I am sure that he is an admirable man, and he and his team of keen, young accountants have been doing their best to deliver the remit presented to them by the Chancellor of the Exchequer. I have the Gershon report here, and it and the Butler report are two documents that will embarrass the Government in the longer term. As observers outside the machine, it is difficult to believe that Sir Peter and his team can transform delivery in every Department, and most of local government too, in anything like the terms described. Most of Sir Peter's proposals are sensible, and he goes for obvious areas such as backroom services and procurement. The sentiments are perfectly worthy, and the comments on management are good.
  On Monday, we were encouraged to believe that from now on every Department of State from the Treasury to the Scotland Office, local authorities, every branch of the NHS, the Ministry of Defence and all will embrace the principles of the Gershon report and—most importantly, given the Government's publications and public expenditure review—hit spot on the figures that we were given. Some of those figures were slightly alarming, such as the number of jobs that will be lost, and some of them are important to the Chancellor, such as the billions of pounds of efficiency savings. To believe those figures is to believe in magic, and events will not occur in that way.
  I am happy to concede that the report will prove to be a worthwhile influence on those parts of the public sector where officials genuinely wish to improve efficiency, to take on board experience from the management of other large outside organisations and to argue with the Treasury about how they have applied some of the Gershon principles. We will never know whether the Gershon report is delivered. It emphasises that delivery should be measurable and that an audit trail should be left, so that we can turn back in 2008 and see that it has been delivered, but I do not believe it.
  We have been promised that technical guidance will be given by each Department to enable us to audit and measure what the Gershon report delivers. I do not believe it, and I shall give some examples why. We have been given gross figures on staff savings, which must be alarming to Labour Members who are particularly close

  1473
  to the white-collar trade unions. Never fear, we do not know the net figure, and many of those jobs will be saved, although the people will work somewhere else, and some administrative posts have already been redefined as front-line posts.
  On Monday, one of my hon. Friends asked a sensible question about how many of those jobs will be outsourced, which, particularly if one goes in for information and communications technology, is obviously the way for large organisations to go. Outsourcing often means that the same man or woman continues to do the same job in the same building, but they no longer work for their first employer and are transferred to a new employer.
  The targets include giant organisations that are not within the Government's direct control. Some local authorities strive to improve their efficiency, and a few have succeeded. I look forward to the process by which different authorities are persuaded to pool their backroom functions. The transformation of procurement across local government will not be delivered: in my opinion, much of local government was untouched by the Thatcherite managerial revolution of the 1980s, let alone by the Gershon report of 2004. Their reaction has not been to welcome with joy the idea that they should make these efficiency savings. This morning, the Local Government Association is reported to have commented that the total is at least £1 billion less than it requires to hold council tax increases below 7 per cent. a year. I continue to believe, and say so to all my colleagues, that unless and until someone comes up with a proposition that will credibly restrain local government expenditure and increases in local government taxation to anything like the rate of inflation, rate-capping is the only way to improve efficiency and to limit the cost to many of my constituents of the ever-rising demands of local government.
  As for the national health service—the largest employer in western Europe and a giant oil tanker of an organisation—the delivering of all these targets in relation to various NHS trusts is not under the direct control of Government. I find an extraordinary contrast between the highly desirable talk on all sides of localising more responsibility and the production of central documents mandating parts of such a huge organisation to produce particular efficiency improvements in particular ways. The principle of managing any giant organisation is that one devolves responsibility locally as much as possible, so long as local bodies remain accountable to the centre and one can give them clear objectives regarding the standards and quality that they are meant to deliver. One cannot give a bottom line in the public services as one can in a private company, but one can set quality standards such as waiting time targets, pupil achievement targets or rates of detection targets for those who deliver the service.
  Localism has now been taken to an extreme degree, with hon. Members on both sides of the House advocating that all central responsibility should be passed on to locally elected groups or locally appointed
  1474
  people who are to be allowed to go their own way. It is very unlikely that they would all be able to deliver Gershon efficiency improvements.
  Mr. Fallon: Does my right hon. and learned Friend find it as telling as I do that of more than 100 local authorities and 100 NHS trusts consulted by Gershon in his review, only 12 local authorities and 12 NHS trusts responded?
  Mr. Clarke: I did not know that, but it is a telling fact that gives some indication of how they intend to respond once our debates are over and the report has been put, together with many others that now reach them, on the shelves of the chief executive's office in county halls and NHS trusts up and down the country.
  This process is not even new—it has been tried before. The underlying drive behind the Gershon review, is on page 10 of the report:
  "The focus on productive time of frontline professionals reflects existing initiatives to reduce bureaucracy and significant investments in workforce reform and ICT across the health, education and police sectors in the 2002 spending review."
  The same things were put forward in the 2002 spending review, when we were given value-for-money public service agreements. In 2004, those have become efficiency agreements, but they are essentially the same, although much bigger numbers have been put on to them.
  Nevertheless, I hope that some good comes of Gershon and the other attempts to consider central government efficiency, because they are much overdue. My hon. Friend the Member for Arundel and South Downs cited several examples to show that we have been going in the opposite direction in the past four years of spend, spend, spend.
  Some things, many of which are very important, we will never measure. In making efficiency savings, a great deal depends on improving the productive time of staff, especially professionals. That would be valuable because the productive time in most professions has not increased in the recent years of massive increases in expenditure. We are all used to meeting teachers, doctors, nurses and policemen who say that, despite the recent vast increases in expenditure, the amount of time that they spend on their productive work is decreasing. Increasing that time is one of the principal and desirable objectives of the review. However, the Government have been going in the other direction for some time.
  Whatever the case for many of the changes that the Government have made in the name of reform, they have not tended to increase the productive time of our professional staff. For some reason, they renegotiated the contracts of all the key professionals in the national health service. I do not know why the Government bothered to do that. My experience of negotiating contracts with NHS professionals showed that it is a Pandora's box—the lid is best left where it was. The Government's negotiators lost. The guys from the British Medical Association are tough characters. The main achievement of the new contracts is to increase salaries and reduce work load significantly.
  In education, the Government take credit for the large number of classroom assistants. They were not employed to improve efficiency but because the

  1475
  National Union of Teachers complained about teachers' work load. Extra people were brought in because the NUT complained about that. Extra people were employed to shift from teachers' shoulders the burden of work and share it with them.
  Alan Howarth rose—
  Mr. Clarke: I do not want to argue the merits of the case. My former right hon. Friend might be passionately in favour of all the improvements in professionals' working conditions, but they do not increase productivity. It is no good changing the statistics, as the Government have done, to try to prove that, because everyone works shorter hours with fewer duties, productivity is increasing. It is not.
  Alan Howarth: My former right hon. and learned Friend, who is also a former Secretary of State for Education, takes a broad-brush view. However, has not he noted that the NUT is the one teachers' union that did not want the classroom assistants?
  Mr. Clarke: That is a fair point.
  Let me give examples to conclude my point. We will never know how the extraordinary figures will be delivered. Let us get behind them and examine the so-called efficiency improvements and savings. How will we know, when we get to the end of the period whether, for example, NHS staff are making better use of their time? That is one of the Gershon objectives. Under that heading, half the Department of Health's total efficiency targets will be delivered. Anyone who could produce some means of auditing that would be the most brilliant accountant or work study consultant that I had ever met.
  The front-line professionals in schools, colleges and higher education institutions will use their time more productively, according to the report. That accounts for 30 per cent. of the total figure put down for the Department for Education and Skills.
  How will we know whether our police services become 3 per cent. more efficient? It would be interesting to have a conversation with one's local police commander about how he would demonstrate that he was 3 per cent. more efficient in three years as a result of Gershon. We should be glad to know that local authorities will achieve further improvements in the productive time of their staff. Figures are attached to those headings. Of course, it is highly desirable that all those things should happen, but we will never have the first idea about whether they have been delivered.
  Mr. Kelvin Hopkins: I am enormously entertained by the right hon. and learned Gentleman's speech. He talks about efficiency, which is obviously a good thing in one sense, but improving public services often means higher staffing ratios. If we want better teaching in schools, we need smaller classes. In hospitals, we need more staff per patient to improve the service. In one sense, that decreases efficiency, but it makes for a better service.
  Mr. Clarke: I accept that that can sometimes happen. A sensible approach to efficiency in government should
  1476
  be a permanent duty of every Minister. It should not be based on arbitrary figures for staff reductions or on conjuring imagined monetary values for proposed productivity improvements.
  Every Government have their different methods. If I were really going in for dèjàvu, I could tell the House about the Rayner reviews in the early days of Margaret Thatcher, when I was a departmental Minister. In those days. it was not Sir Peter Gershon but Sir Derek Rayner who came round and explained to us how to run our Departments, along with some bright young accountant who was still trying to find out what the responsibilities of the Department were. I hate to say it. but I went in for staff number reductions. I did it in the NHS—often specifying how many jobs had to go—in despair of anyone attempting to raise productivity.
  I agree, however, that what is required is a wholly different approach to policy from the one that we have seen over the last seven years, in which the control of running costs, and the balance between administrative costs and what is being delivered by front-line staff, is a permanent feature of policy, to be built in to what is being done. I share the view of those critics who say that this Government, who lecture us on improving public sector efficiency, have actually been neglecting it for the last seven years.
  Before this debate is over, I shall no doubt hear more examples of all the areas in which things have gone in the wrong direction, even in my old Department, the Treasury, which I hold in very high regard. One day, the Chief Secretary must explain to me why even the central Treasury, which does not employ very many people, seems to have increased by at least half as much again since I was there, and now has about 600 more civil servants than it did on the day I left it. I have no doubt that the Minister has found productive ways of employing the time of all those officials, and I suspect that I would find that situation reproduced across Whitehall if I were to look at the way things have been going in the last seven years.
  The required policy changes would need a whole new speech to specify them, but I would advise my right hon. Friends to add some policy changes when they produce the James report and we all concentrate on efficiency again. To give an obvious example, we have far too many quangos. I would like to see a list produced by both sides, and by the Liberals, of the quangos that should be rapidly abolished. Of those quangos that now send me literature, I have often never heard of the acronyms of organisations that are now responsible for some comparatively obscure part of the public service. I would even get rid of some of those that have got themselves a certain dubious public popularity. The Electoral Commission drives me up the wall—it already has 150 staff, it is spending several million pounds and I am not sure what it is for—and there are a whole lot of other quangos that ought to be addressed.
  We do not even know how many regulatory bodies we have; it is thought to be between 140 and 150. I would like both Front Benches to produce a list of at least half of them that could be abolished or amalgamated. I agree with the Liberals about getting rid of the Department of Trade and Industry. It would have some residual functions—but no great budget—which could be put among other Departments. The Chief Secretary told us about the increased budget of the regional development

  1477
  agencies; I would abolish them. I do not think that they make worthwhile use of public money or serve any worthwhile purpose. It is the old regional planning stuff all over again. As for the proposed new tier of regional government that some people are having referendums on in the autumn, I would kill it off now, if we are really trying to improve the efficiency of government in the country generally.
  I suppose that this is true of many people at my stage of life, but over the last few years I have found myself genuinely feeling—all politics aside—that I am living in a country that is increasingly governed by regulation. I am increasingly faced with forms to fill in for all sorts of routine parts of my life. I increasingly have to deal with public bodies that I have never heard of, but which have suddenly found that their participation is essential in whatever I am doing. Far too much of the world nowadays seems to be run by a second-rate bureaucracy that is over-manned yet still growing. That is what the Government need to tackle, and that is what I am sure that my right hon. and hon. Friends will tackle. Smaller, better government is what we require in the modern world—it has been growing too fast—and that way lies the health of the public finances and the long-term sustainability of growth in the British economy.
  4.28 pm
  Mrs. Lorna Fitzsimons: I feel rather humble to be following the right hon. and learned Member for Rushcliffe (Mr. Clarke), with his august Cabinet history. I clearly have not held any august office—I am just the lowly Back Bencher who represents
  Rochdale—and all that I want to comment on is the impact of the comprehensive spending review on my constituency, where I have lived all my life, apart from a blip when I went to university.
  The CSR has made a huge, long-lasting, significant and long-overdue difference. After all the hyperbole about what Gershon and everyone else says, we need to cut to the heart of what the CSR means, in real-speak, to real people's lives. When I was elected, unemployment in my constituency fluctuated between 9 and 11 per cent., depending on the point in the cycle. Now, it is never much more than 3 per cent. Youth unemployment and long-term unemployment have been cut so drastically that they are virtually impossible to measure. In terms of school results, we have the best in my constituency's history. Yes, they have a long way to go, but they have come a long way. The investment in schools is phenomenal and is set to continue.
  So phenomenal is this Government's investment in my constituency that my local paper will not even publish the figures, because it thinks that they are too incredible. The local development agency, at its annual general meeting this year, published a figure of £2 billion worth of investment by 2010 in the borough of Rochdale. The vast bulk of that was public money, but it will lever in a significant amount of other money. That figure is indeed incredible, but it can be broken down to projects all around the borough, and specifically in my constituency. We need to safeguard that investment, and I will do all in my power to support the CSR that has been laid before the House to do so. We need to build on that investment.
  1478
  In my constituency, there are initiatives that need to be enlarged, but there are also those that we need to celebrate. For example, we have a new hospital, which has more doctors, more nurses and more people being treated in it. Yes, change means uncertainty in terms of certain profiles of service, but it does not mean lack of growth. We are developing extra services in Rochdale—more than we have ever had. For example, Rochdale has more police than it has ever had in its history. We have a bigger policing budget and a bigger and far more effective drugs treatment programme, and we hope to be beneficiaries of the Chancellor's announcement about neighbourhood wardens. The more local and specific the policing, through partnerships in law and order, the more effective it is, as the evidence shows.
  On housing, I welcome the wonderful announcement in the CSR. Rochdale is a net beneficiary in the housing market renewal project, arm's length management organisations and investment in better social housing. Housing market renewal is a real test in the pilot areas. It is a huge leap of faith in the amount of Government money that has been invested, but the difference that it will make will revolutionise communities that time forgot, and certainly the Conservative party when in government forgot. The reality is that those communities live in circumstances that most of us would not even tolerate, and they have been in that position not for five or 10 years, but 20 years and more.
  We need to ask specific questions of the Liberal Democrats about area-based initiatives, of which Rochdale has a lot: housing market renewal, single regeneration budget round 5, new deal for communities and neighbourhood renewal fund. The Liberal Democrats' economic policy contains a specific little clause—those are the interesting ones—proposing to scale back area-based initiatives. I would like to know what that means for constituencies such as mine, which need specific targeting. It is not the whole borough of Rochdale that needs those initiatives, as it houses two dramatically different communities. Norden and Bamford, which is in the constituency of my hon. Friend the Member for Heywood and Middleton (Jim Dobbin), has 0.03 per cent. of the richest population in the country. Wardleworth, in my constituency, has 0.03 per cent. of the poorest population, and we need area-based initiatives. I wonder what the Liberal Democrats mean by their economic policy.
  On the specifics of the statement, I wonder whether my hon. Friend the Minister will answer a few questions about area-based initiatives such as housing market renewal. One of the things we have learned through earlier programmes such as SRB5, and are still learning, is that the Treasury needs to allow flexibility—through the Office of the Deputy Prime Minister—to the regional development agencies, and organisations such as English Partnerships, in local spending on, for instance, housing market renewal. There is no doubt that that must be based on housing outcomes, but houses are about communities. and communities cannot be sustained without community facilities.
  Two years ago, 48 per cent. of Wardleworth's population were under 16, but there were no significant youth or sports facilities in the area. We have had to put bids together for the sports lottery. We have just secured £1 million, which is wonderful. It is £2 million short of our bid, but it is still £1 million, and we are not going to

  1479
  say no to it. What we need, though, is the flexibility that I mentioned. Housing market renewal, English Partnerships and the regional development agency will then be able to add to the money we already have. We can use our initiative, with the help of brilliant local officers in both the RDA and the council, to capitalise on that. Yes, we are going to have mixed-market economy new homes, but they will not sustain a community without real youth facilities. I hope that my right hon. Friend can throw some light on that because we need detailed answers.
  I may have misheard, and I have heard no further details, but I believe that the statement referred to community facilities. I understood that a fund provided through the ODPM might help. Specific funds such as the housing market renewal fund are aimed at specific targets, and it might be as well not to deviate too far from those targets. This fund, however, might be used to provide much-needed health services and youth facilities. I should very much like to hear more about it.
  The extension of the neighbourhood renewal fund for three years is very welcome. As my right hon. Friend will know, one of the problems with some of the initiatives—although we do not suggest in any way that we do not want them—is that they involve short-term amounts. Anything that can be done to put chunks of money together and make the provision more permanent and sustainable will add to the undoubted impact of many NRF projects in our patch and across the country, and make them even more beneficial to the communities that they are intended to help.
  I am very pleased about the extra investment in early years and family facilities. It makes so much sense. Anyone who has worked in education or child development, or takes an interest in antisocial behaviour, will know that the most important investment is made in the first six years of a child's life. I am lucky to represent a constituency that has received wave upon wave of Sure Start support. It is so good that people think they designed it themselves. It is probably the most successful of all Government policies.
  I would welcome any additional investment from the CSR to extend the reach of Sure Start to all communities. The child poverty review acknowledges, among other things, the importance of investing in families. Although all the evidence suggests that poverty is a huge indicator of a child's health—including mental health—educational attainment and life chances, we must not assume that all parents, regardless of wealth or lack of it, do not need help with parenting. Nor must we assume that all children involved in antisocial behaviour come from poor backgrounds. Many children in my village who cause a neighbourhood nuisance—I would not place it on the same scale as the antisocial behaviour that some people must put up with—do not come from deprived backgrounds. Nevertheless, investment in youth facilities, in the extension of schools and in parenting assistance would accord with Government policy that is already making huge inroads in constituencies such as Rochdale.
  In places such as Rochdale, economic regeneration is also very important. We are very lucky in having Kingsway business park, which is the biggest economic development in the north of England. I thank the Northwest Development Agency, English Partnerships, the Treasury and the Office of the Deputy Prime
  1480
  Minister for creating that huge development, which has used £35 million of taxpayers' money to lever in hundreds of millions of pounds of private money. As a result, a very deprived area of north Manchester enjoys untold investment in new economies.
  However, we need to capitalise on that investment. My right hon. Friend the Chief Secretary alluded to investing in the Northern Way, which forms part of the Deputy Prime Minister's vision. Can my right hon. Friend assure me that consideration will be given to capitalising on the public money that has already been invested in the Northern Way, and in places such as Kingsway business park? As I said, we have £35 million of Government money and hundreds of millions of pounds of private money, yet a certain tension exists, in that there are those who are focusing on investment in the major cities. We should note that the poverty index shows that the northern part of Greater Manchester is one of the poorest conurbations in the entire country.
  There is another Greater Manchester organisation, Knowledge Capital, into which the Government are pouring a lot of money; in addition, there is the merging of the universities. It would be a tragedy if we failed to widen the aperture a little—if we failed to combine these elements in order to ensure that we bring the Deputy Prime Minister's Northern Way vision to fruition. We need to make use of the substantial investment that the Treasury has made in places such as Rochdale, Oldham and north Manchester. I ask the Treasury to look into this issue and to ensure that we join up such investment. There is only a matter of miles between these locations; it would be a real shame not to capitalise on that investment.
  Constituencies such as Rochdale have not only thriving Church communities but huge and diverse ethnic populations, so I welcome the great interest that the Government are showing in international affairs. It is impossible to overstate the importance of their historic level of investment in international development. Cutting to the chase, such investment is also investment in security. My constituency is one of the biggest recruiters for the British Army, so it has a huge interest in defence. In the light of that and of my international development work, it is clear to me that we need to invest in other countries, because eventually somebody else's poverty becomes one's own lack of security.
  I pay tribute to the Government's approach to international investment. People talk about the war and describe us as the great devils, but we are the biggest single investor in Palestine. We are holding things together, yet no one else is putting their money where their mouth is. Indeed, we are about to become one of the biggest investors in Africa. I say to the Government: please do not stop making such investment. Some people argue that investing in Palestine and Africa undermines jobs and prosperity in this country, but the reverse is true; indeed, such arguments endanger community cohesion in places such as Rochdale. That investment ensures jobs and prosperity in this country, because the richer we make the rest of the world, the richer we make ourselves. I am not a religious person, but I do believe in the principle that we should do as we would be done by, and that one should give in order to receive. I commend such investment; it is morally valuable in itself, but it also constitutes a defence policy.

  1481
  Be it housing, regeneration, schools, families, law and order or international development, the comprehensive spending review builds on policies that make me proud to be a member of the Labour party, and proud to be a Member of a Labour Government who are remembering forgotten communities such as Rochdale.
  4.44 pm
  Dr. Vincent Cable: I shall first respond directly to the hon. Member for Rochdale (Mrs. Fitzsimons) who threw a question at me. She is right, and I have never concealed the fact that I believe that all parties, whether in government or in opposition, have to make choices. That means saying that we cannot solve all the problems of government by eliminating waste. I entirely agree with the spirit of the comments made earlier by the right hon. and learned Member for Rushcliffe (Mr. Clarke). That is why we have said that there are certain things that the Government should get out of.
  We have paid considerable attention to area-based initiatives. It may well be that the one in Rochdale is brilliant and I commend it if it is, but our experience has been—it is not an academic analysis, as there are Lib Dem councils in northern cities as well as in the south-east—that many of the area-based initiatives duplicate and centralise many of the functions of local government. They should therefore be cut back. The hon. Lady is right that we are arguing in favour of cutting back those initiatives.
  The former Chancellor, the right hon. and learned Member for Rushcliffe, made wise and helpful comments. He rightly started off by placing the discussion in the context of macro-economic policy. Discussion about waste is important, but we have to look at the macro-economic context. It is certainly true, at least on the surface, that the budgetary position is very good and the debt position is comfortable. The golden rule appears to be being met.
  My concern about the macro-economic position is that, although the British economy as a whole has been fairly stable, the Budget has been highly unstable. We have had a lurch from famine to feast. We saw public spending at roughly half the growth of the economy as a whole for the first few years, then it greatly exceeded the overall growth of the economy, and we now have the third phase. The Government have not pointed out clearly that public spending plans are front-loaded with a big increase for 2005–06 and then a sharp slowdown subsequently.
  It is not simply that instability is a problem in itself, because enormous costs are associated with it. One of the biggest causes of waste in government is not so much bureaucrats—we will get round to them in a minute—but the £1 billion a year that we pay on excess charges in the NHS for agency nurses. There are several reasons for that. One of the reasons why there are so many agency nurses is that key decisions on nurse recruitment and education were not taken five or six years ago. We are paying the price for that today.
  Another example is that we are currently talking about paying £60,000 for a maths teacher, again because the problem of scarcity was not identified earlier on in
  1482
  the Government's term of office. It takes a long time to take a child through from A-levels, to university, teacher training and then into teaching—and it is only now that the problems have been identified. We are now paying the costs and the price of the instability when we lurched from under-funding to over-funding within the public services.
  Mr. Hopkins: On nursing, a chief executive of a hospital trust told me that if he could take the same global sum of money that he spends on nursing and pay a higher rate to all his nurses, he would have a full permanently employed nursing staff. He would not need to employ agency staff. Unfortunately, he is not able to do that, so he has to have a lower level of pay for his nurses and buy in agency nurses.
  Dr. Cable: There is a lot of wisdom in what the hon. Gentleman says, but he knows that there is an overall problem of supply, which traces back in time to failures of recruitment.
  Our debate today has focused primarily on the concept of waste in public services. It was particularly evident in what the Conservative spokesman said, but it has been equated by virtually everyone with the cost of administration. We can argue about too much administration and too much bureaucracy, but waste is a wider concept than that. The Government are right to point out that some elements of waste have fallen. We have less unemployment, fewer debt interests and we are avoiding policy areas such as the poll tax.
  The concept of privatisation was also slipped into the Government's litany of Conservative crimes. I was rather surprised by that: as I understood it, one of the key elements in the Government's spending plan is £30 billion worth of asset sales. I think that that is privatisation, so I do not understand why it found its way into the list.
  Other elements of waste have not been mentioned. We heard the Prime Minister's statement earlier today. For some of us, the £3.5 billion spent on the war could be classified as a sort of waste—not simply because the war was fought, but because if it had been fought properly under multilateral rules, it would have been funded internationally, as the first Gulf war was.
  Yesterday we debated energy. What was not spotted by too many people was the fact that the Government have now put into the public domain, admittedly over a long period of time, liabilities of a minimum of £50 billion, because electricity—particularly nuclear electricity—was not properly costed. That waste, both physical and financial, is now dumped back into the public sector. Waste is multi-dimensional, and not only to do with bureaucracy.
  Mr. Flight: I said that there were two types of waste. One is defined in the narrow and traditional sense and investigated by the Public Accounts Committee and the National Audit Office; the other requires major policy change to address, as my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) pointed out. It is highly important that we all are clear what we are talking about. I certainly meant the word "waste" to be taken in its widest sense.
  Dr. Cable: I agree, and I will develop the point now.

  1483
  The key point in the debate is the assumption that public sector productivity can grow by 2.5 per cent. a year. In the private sector, which has additional incentives, service productivity growth is only 1.5 per cent. The Government assume that the public sector will be much more productive than the private sector, even without the incentive structures. The figures are elusive, but I understand public sector productivity growth is close to zero. That means that some pretty heroic assumptions are being made.
  I often call to mind the old story about the economist stranded on a desert island with tinned food and nothing else. When asked how he will survive, he says, "Let's assume the existence of a tin opener." Essentially, that is what lies behind the Government's plan. They are saying, "Let's assume the existence of 2.5 per cent. productivity growth—plausible or otherwise."
  The Chief Secretary helpfully clarified a confusing element in the statement. I refer hon. Members to page 13 of the published version. He said that the £20 billion Gershon savings, which include savings from the dismissal of a net total of 70,000 civil servants, will be outside the spending review. Therefore, the savings made from the sacking of civil servants and implementing the Gershon report will be over and above the spending limits. The Government's strategy is to feed those savings back, in some sense, into public services.
  That raises some important questions. How will the Gershon dividend be paid? What is the mechanism? I offer a simple example involving the Department for Work and Pensions. I do not want to go into the pros and cons of the matter, but by sacking 40,000 civil servants costing roughly £25,000 each the Department will save £1 billion a year. What will happen to that money? Will it go into improved services in work and pensions? Will it go into pensions, or back to the Treasury? How does the dividend get paid?
  There is a bigger question for the economy as a whole. I hope that Ministers will correct me if I am wrong, as I am trying to understand what is going on, but the Government have said that the £20 billion a year generated in additional savings and extra productivity will all be spent on public services, and that it will not go back to the taxpayer. Is not the logic of that that the share of public spending in gross domestic product will rise as a result of the successful implementation of Gershon? I should be happy to be corrected if I have misunderstood the proposition, but we need to be very clear about how the Gershon dividend will operate, at both micro and macro level.
  My second question is about conditionality, and it relates in part to what the right hon. and learned Member for Rushcliffe said. How do Departments get their spending allocations in the context of the Gershon reforms? Let us suppose—it may not happen—that the Department of Health performs extremely badly in respect of all the Gershon reforms, and that it does not achieve its IT or procurement targets and so on. Does that mean that the funding in the spending review will be withheld, or will it be increased because of the Department's underperformance? There has always been much ambiguity about what public service agreements mean, but what rewards and penalties exist
  1484
  in the system to ensure the implementation of the Gershon improvements? How the conditions work is massively unclear.
  The right hon. and learned Gentleman asked another question: how do we know when reform has been implemented, and how do we measure performance? I am delighted that Professor Tony Atkinson, who is an underestimated and important academic, will be brought in to try to help answer those questions. However, economists have been worrying for 20 years about how to assess public sector productivity.
  The attempts to improve productivity in the public sector can be very daft. Shortly before I became an MP, I visited my local borough police commander. He was a bright young thing who had just come out of a refresher course at the police college and was buzzing with management speak about productivity. He told me that he had been thinking through his borough's strategy and that he intended to get rid of beat policing. He gave me a little homily to the effect that the chances of a burglar being caught by a beat police officer were as remote as the chances of being hit by an asteroid. That proved to him that good management and improving productivity meant getting officers back into the police station so that they could go out in their cars in emergencies. He called that high-productivity policing, but we all know in retrospect that it was just daft. The police have since done a U-turn on that policy, and we are no closer to understanding how we could improve productivity in policing.
  Further education is another example. The head of my local FE college tells me that it has been subject to productivity targets from the Treasury, via the Department for Education and Skills, for the past five years. The sector already has a 2.5 per cent. productivity target. The college achieves the target by increasing class sizes—more students, same number of staff. Is that what the Gershon reforms will mean?
  The Financial Secretary to the Treasury (Ruth Kelly)indicated dissent.
  Dr. Cable: Well, it is not clear who will decide how the target should be achieved and how Departments will be rewarded or penalised if they succeed or fail.
  The immediate action—as opposed to the general commitments in Gershon—is the dismissal of 84,000 civil servants. How much will that actually save? We hear some confusion about numbers. The BBC said that it would save £5 billion. However, a little mental arithmetic suggests that the loss of 84,000 people who are paid an average of £25,000 a year—who would all be paid redundancy money—would save only £2 billion. That suggests that Digby Jones is right to suggest that the 84,000 would be only a tiny fraction of the job losses necessary to meet the Government's objectives.
  Can the Government tell us a little more about the civil service cuts? Who will suffer them? Will it be the people who have been brought in over the past two years, many of them to do IT work? What will be the split between senior and junior civil servants? That will make a big difference to the cost savings, but we have no specific information at present.
  Can the Government tell us something about the deeper aspects of the Gershon reforms and how they will be delivered? From the documents that I have read it

  1485
  appears that one of the key arguments is that we will see a big leap forward in information technology. However, the Government's record in that area is abysmal. The National Audit Office suggested in a report a couple of years ago that only a third of Government IT projects succeed. We all remember the Passport Office story, and the courts and the Post Office have suffered fiascos in that area. To their credit, the Government have introduced a much improved procedure, including the gateways, and the level of error has been reduced. However, many of the projects are still highly doubtful. People close to the industry, such as Computer Weekly, are concerned that the IT programme will unravel badly with disastrous consequences, especially for the NHS. One of my reasons for arguing that the Home Office should abandon its plans for identity cards—apart from the civil liberties aspect—was the management issue. How would a Department that has conspicuously failed to manage big IT projects in all its other operations be able to handle one that would be even more complicated and difficult?
  The other element in Gershon that is very important—the hon. Member for Arundel and South Downs (Mr. Flight) highlighted it too—is the centralisation of procurement. It will be a key part of the process. In business, centralisation of procurement has gone in and out of fashion, but Gershon goes in for it in a big way. A move from 400 to four major civil service procurement centres is planned. Is that feasible? At the end of the debate, may we have an indication as to the Government's progress in centralising procurement and how it will work? My understanding is that few councils or agencies have agreed to undertake that process.
  The Government and the Conservatives place great emphasis on the idea that somehow or other they can achieve great savings by getting rid of the back-office staff and concentrating on the front line—to use the jargon. However, I have never been wholly clear as to the distinction between the two; nor are the Government, because they have just reclassified £5 billion in that regard.
  One of the things that most shocked me when I became an MP was visiting my local police station and seeing big, brawny, fully-trained police officers doing their own typing. We were in the wake of cuts in the Metropolitan police; at the time, the current Conservative leader was Home Secretary and we had just gone through a period of downsizing, so when I asked why those officers were typing instead of being out on the streets, I was told, "We decided we needed to get rid of our civilian support staff to concentrate resources". However, somebody had to do the clerical work—the police officers.
  One of the new fashions that the Government have adopted and the Conservatives are advocating is to get rid of local education authorities—those parasitic, bureaucratic tiers of management. They claim that great savings will be made by getting rid of LEAs. In my area, I discovered that the LEA is small. I am not making a political point, by the way; the local council is a Tory one. The LEA occupies one floor of a multi-storey building and comprises fewer people than the James committee, yet it is responsible for all the borough's education administration. Which of those people would
  1486
  the Government get rid of? Who would do their tasks when that "unproductive" layer of management was stripped out?
  Perhaps we do not need the LEA's four inspectors, although it is self-evident that schools need inspecting—they cannot wait for Ofsted every three years. A few people handle student grants and a few deal with special needs. Those people cannot be stripped out with no consequences. Other people deal with the payroll and staffing. If their posts are abolished at the LEA, they will reappear in schools, so where will we see the savings from stripping out that layer of management?
  Both the Government and the Conservatives have created the illusion that these changes can be easily made. I have been in a big company that was McKinseyed and saw the process at work. Management consultants decide that many functions can be stripped out, but it cannot be done, and senior managers end up doing their own secretarial work. In business, that is called "managing your own function" and it is often extremely inefficient. There is much glib talk about savings from eliminating waste and stripping out management. Of course, there are things that should be done, but much of what is actually achieved is worryingly superficial.
  It is my view, which I have also argued as my party's spokesman, that the Government must get out of certain activities. Although arguments about waste are important and we have to be on the ball about such matters, we have to make political choices. One of the reasons that my colleagues and I focused on the Department of Trade and Industry is that although it is not one of the biggest Departments, it raises the biggest questions about whether the Government have any basic competence in that field. It has a budget of £5 billion and it is supposed to help business and industry.
  When I attended a conference recently I was struck by the comments of one of our leading Asian entrepreneurs, Ghulam Noon. He turned to the Secretary of State for Trade and Industry, who was in the audience, and said: "Will the Government please stop trying to help us? Just let us get on with our job. Make sure the infrastructure works. Keep taxes reasonable, but please stop trying to help us."
  The Chancellor is passionately committed to science, innovation and research and development schemes, but many of those things are unproductive. The OECD did some good research recently, which showed that support for R and D distorts and completely displaces private sector R and D. It adds no value in the economic sense. I would not go quite that far; there is a residual role for the DTI, but much could be taken out.
  We really need money for pensions, which are a big priority; they must be lifted out of means-testing. We have to find the money from somewhere. That is the kind of choice we have to make.
  5.5 pm
  Alan Howarth: The hon. Member for Twickenham (Dr. Cable) calls for perfect forecasting and perpetual stability. All Governments would like to achieve that but, of course, government is very difficult. This Administration are decent and outstandingly capable, and the spending review demonstrates their intellectual and moral energy. The

  1487
  review is based on seven years of experience, during which a matured and successful strategy for government has been developed.
  The fiscal stance seems to be sound and that is confirmed by a rather better judge—the markets, which are unperturbed by the spending review. The right hon. and learned Member for Rushcliffe (Mr. Clarke), my former right hon. and learned Friend, has the ability, amiable indeed, to make apocalypse sound very jolly, but I think that he will be disappointed. There is every reason to suppose that my right hon. Friend the Chancellor will successfully adhere to his fiscal rules and he has proved a better forecaster than most of his critics in recent times.
  An independent umpire, the Institute for Fiscal Studies—all hon. Members could accept its objectivity and competence—tells us that, as total public expenditure rises to a planned £580 billion by 2007–08, it will represent 42.3 per cent. of national income. That figure is below the average of 44 per cent. of national income that prevailed in the years of the Conservative Administration. It is in line with OECD standards and lower than the figure found in many European countries.
  The sustainable investment rule should be met. Public sector debt is expected to rise to no more than 36.5 per cent. of GDP—well within the 40 per cent. limit that my right hon. Friend the Chancellor sets himself—and public sector net investment is planned to rise from 2 to 2.25 per cent. I note that that is well out with the rules of the stability and growth pact. The borrowing requirement will clearly exceed the requirement of the stability and growth pact that a balance or surplus should be achieved over the cycle, taking into account public investment. Thank goodness, we are outside those constraints, and my right hon. Friend the Chancellor has kept us out of that financial morass. Given the dismal history of deflation and wasted potential in the eurozone, surely we cannot now wish that we were part of that system. It is interesting to note that the flat-earthers in the Commission were upheld yesterday by the European Court of Justice. Will they then proceed to impose penalties on France and Germany, compounding the deflation for which they have been responsible through their policies in past years? The answer is no. They would have had a go at that a couple of years ago; they will not do so now, thanks to the pressure for reform created by my right hon. Friend the Chancellor.
  Mr. Hopkins: I have great sympathy with what my right hon. Friend says. We have a happy fiscal policy because we have the ability to choose our monetary and fiscal policies and to ensure that they work well in tandem. That is possible because we are outside the eurozone. Does he agree that we should stay outside the eurozone so that we can continue to manage our economy sensibly?
  Alan Howarth: I can certainly see no case for subjecting ourselves to the consequences of a single currency, such as a one-size-fits-all interest rate and all the associated constraints on fiscal policy, so I agree with my hon. Friend.
  The Government's spending plans are predicated on an assumption that there will be no serious economic slow-down in the wider world. It is difficult to be entirely
  1488
  optimistic about that. Given the fiscal profligacy and the monetary imprudence that have prevailed in the United States of America for a good long time past, clearly, after the presidential elections, there must be a retrenchment in the USA, which will be bad for growth. Equally, if the politburo manages to slow down the Chinese economic juggernaut to some extent, it might provide a shock to the world economy. However, I think that my right hon. Friend the Chancellor's plans allow for sufficient margins to accommodate any setbacks of such a nature that might occur.
  The departmental expenditure limits are anticipated to rise by 4.2 per cent. per annum on average throughout the spending review period but, as has been noted, reductions in the rate of growth are intended in later years. Rather than assuming that that will be achieved through a process of slamming on the brakes that would be impossible to handle, I take it that it is a prudent provision for the future. Let us see what proves to be fiscally manageable in the event.
  It must be acknowledged that it will be hard to spend a 4.2 per cent. average increase in public expenditure efficiently and effectively, which makes the efficiency review all the more important. Moreover, increases to front-line spending are intended to be substantially funded by the benefits of the efficiency drive. As hon. Members have noted, it will be difficult to achieve the efficiencies that are held out. All Governments have promised to achieve dramatic efficiencies in the use of public funds, but the Parkinsonian tendency for bureaucracies to expand is unrelenting. It will be a tough job to get the process right without any doubt. The process will also be tough for the public servants affected, so I was pleased, but not at all surprised, to note that my right hon. Friend the Chancellor intends to take a great deal of care of those staff, in human terms, to ensure that the personal consequences that they face are no harder than they need to be.
  Several commentators—the hon. Member for Twickenham added himself to their number this afternoon—have said that we will never actually know whether the efficiency targets have been achieved, but I do not think that that is right. My reading of the Gershon review is that it is rigorously set out and establishes bases and benchmarks against which we may judge performance and progress. It sets out relevant definitions, describes the methodologies for achieving efficiency and offers a variety of expert support systems.
  I do not think that any of us can doubt that there is scope now, as there always is, to achieve economies. Let me offer one small vignette that arises from my recent constituency experience. The young son of one of my constituents assaulted a teacher and there was a requirement that the boy attend a non-maintained special school. Monmouthshire local education authority was unable to provide appropriate schooling in its own system, so the boy had to be sent away. Two options were considered: a special school in Cardiff charging fees of £124,000 a year; and a special school in Somerset charging fees of merely £75,675. To get those amounts into perspective, I checked the fees at Eton, which will rise in the autumn to £22,380. It beggars belief that the public sector is paying such sums. I do not criticise the director of Monmouthshire LEA because he has no choice but to find a placement for the boy. He says that supply is limited and that the situation is what

  1489
  market forces dictate. That provides a small example of the scope for considerable legitimate cost savings in the public interest. The search for efficiencies must be continuous because economies are always there to be won.
  On a more cheerful note, public servants who might have the opportunity to relocate to Newport have nothing to fear. I myself relocated there only a few years ago, and the House must discount my bias because I always fall in love with any constituency that is good enough to put up with me. Better witnesses to the merits of setting up public service shop in Newport are the public officials who already work there—the staff of the Patent Office, the Office for National Statistics and the UK Passport Service.
  As long ago as 1994, the National Audit Office found that, following the Patent Office's relocation to Newport, it had not only improved performance but saved on accommodation and staff costs. It saved on staff costs partly because salaries were somewhat lower in south-east Wales, but mainly because staff turnover was so much lower compared with turnover in south-east England. I shall not descant at length on the beauties and joys of Newport, but I ask my right hon. Friend the Chief Secretary to study an excellent document produced by Newport city council—"Newport: a pleasure doing business"—which is both eloquent and sobersided and makes the case irresistibly.
  The Government are also right to pursue a programme of asset sales, as one would in any substantial business in which assets are found to be surplus to need. It is no more and no less than their duty to the taxpayer, as is the whole drive for efficiency savings.
  I thank my right hon. Friends for specific features of the spending plan. I thank them on behalf of Wales for the average real-terms increase in funding of 4 per cent. that is planned over the period. In particular, I want to mention two items that are small in the scale of things but significant to me, partly because they represent unfinished business from my incarnation as a Minister with responsibility for the arts and heritage.
  I very much welcome the Government's decision to extend the VAT refund scheme to university museums and galleries to enable them, too, to offer free entry. I spoke on that subject in the public expenditure debate two years ago. The Chancellor and the Chief Secretary were kind enough to meet me and a deputation to discuss it. I pay particular tribute to Professor Martin Harris and Dr. Christopher Brown for their expert advocacy of the cause.
  The other small item in the cultural field for which I want to thank the Government is the decision to double the size of the national heritage memorial fund. The fund enabled the National Trust to acquire Tyntesfield. There are now similar needs and opportunities, with the possibility of the National Trust for Scotland acquiring Dumfries house, a wonderful house that reflects the undisturbed work of the three Adam brothers and which has Chippendale furniture, and Abbotsford, which is a house of great historic importance.
  More broadly, I want to express my appreciation to the Chief Secretary for the provisions in the spending review on the voluntary sector. Like me, he has taken a
  1490
  close interest in policy for the voluntary sector over the years. The decision to introduce longer-term funding agreements, to consider in new ways the assignment of risk between the voluntary and statutory sectors, to accept full cost recovery if charities and voluntary organisations provide public services so that they are not subsidising the Exchequer, and the proposed lightening of regulation are all good news for the voluntary sector.
  As a member of the Intelligence and Security Committee, I express my appreciation of the additions to the secret intelligence account. Like all my other right hon. and hon. Friends, I single out the Government's commitment to achieving the 0.7 per cent. of GDP spending on aid as important and welcome. I hope that it will go into the manifesto. I also hope that the Chancellor's plans for an international finance facility are accepted by the international community so that we reach our 0.7 per cent. of GDP in 2008 rather than 2013. Next year, with the chairmanship of the G8 and the presidency of the European Union, Britain will have an important opportunity to mobilise the rich countries of the world to that cause.
  I want to speak about two other policy areas. On higher education and science, I welcome the reiteration of the Government's commitment to maintain funding per student during the spending review period. There are, however, other important requirements for higher education, such as infrastructure—buildings, libraries, laboratories, classrooms, lecture rooms—support for part-time students and, perhaps most particularly, academic pay. The Mouse will recall that in the 20 years to 2002, academic pay rose by 4 per cent. while average earnings rose by 45 per cent. The Treasury used to insist that that did not matter and that there was not a market failure, but that discrepancy was bought at the price of rapid deterioration in staff-student ratios and the jeopardising of quality. It has inevitably affected the quality of recruits to higher education. The Bennett report from the British Academy expressed unequivocal anxieties about the numbers and quality of people embarking on PhDs, including on subjects that are important by the utilitarian standards of the modern world, such as economics or Chinese.
  The issue is whether we can renew our enlarged universities, of which so much is expected, to an acceptable quality. The Government have paid more heed to the Roberts report on the supply of people with scientific, engineering and technological skills, but we must balance the needs of the arts and humanities with the need for science. We should be wary of going down the US route of simply paying more for teachers with marketable skills. I readily acknowledge that there has been a good settlement for academic pay this year, but where are the funds in the plans properly to restore academic pay? Where are the funds to make sure that our remarkable new laboratories will have remarkable scientists in them? How are we to pay for the costs of higher education? If every course charged the full £3,000 allowed under the new tuition fee regime that would bring in a maximum of £1.4 billion after 2009, which should be set against the shortfall in higher education funding of £8.8 billion cited by Universities UK. I do not expect the Treasury to agree with the latter figure, but the disparity is still huge.

  1491
  I hope that the Government will at least fund the recommendations in the Thomas report, which looked at the possibility of creating endowments for our universities. It recommended that the Government provide time-limited match funding to pay for the costs of establishing development offices in universities and training in fund-raising techniques. It also recommended that they look again at tax relief. It is noteworthy that the largest endowments enjoyed by universities in the United States of America have, in the main, been built up in the past 20 years. Although it would be a long haul and a difficult task to raise endowments on a significant scale for our universities, we should certainly try to do so. If higher education in the United Kingdom achieved the same share of individual giving as higher education in the USA, our universities would be £600 million a year better off.
  Naturally, I welcome the extra £ I billion of spending on science in the plans, although I fear that it may partly be at the expense of other areas of the higher education system that are no less important, as a good proportion will come from the budget for the Department for Education and Skills.
  The planned spending on science represents funding beyond any dreams of avarice that I had as Science Minister. The Treasury has become quite dewy-eyed about science. It expects spending to increase by 5.8 per cent. a year in real terms, and is moving towards an objective of research and development taking 2.5 per cent. of GDP. The Government's science strategy in the "Science and innovation investment framework 2004–2014" is, however, rather long on assertion and aspiration and rather short on tight argumentation and precision. It seems to say that a lot of science means a lot of wealth, which is more redolent of alchemy than science. Science is somehow to be the elixir of competitiveness.
  There is much reference in the document to indicators and goals, but when one looks at them, they are all rather vague. The strategy dilly-dallies on its way, for example, to achieving the funding of the full economic costs of public interest research by Government Departments. We are told that the final adjustment to the methodology for that will not be in place until 2007–08 and the research councils should fund close to 100 per cent. only by the beginning of the next decade, yet the issue has been around for a very long time. The transparency review exposed the fact that the Government are not paying the economic cost of the research that they commission from universities. A decision should be taken so that the matter can be resolved.
  All that is strange, as I believe that Lord Sainsbury is an outstanding science Minister. The document smacks of negotiations not quite completed in Whitehall and material that was not quite ready for publication. Its commitments are deferred, qualified or imprecise. More Gershonesque rigour is needed in this regard.
  I am worried in particular that the document holds out a prospect of too much bureaucratic hassle. We are told that to inform periodic reviews of public spending, the Government will conduct every two years a detailed assessment of progress towards goals. Why not just let good scientists get on and do good science? It is not quite in the spirit of devolution, letting things go from the
  1492
  centre and allowing people to take responsibility, that we find both in the Gershon review and in the spending review document.
  I am worried, too, that the tilt towards applied science may be carried too far. The research council programmes are to be more strongly influenced by and delivered in partnership with end users of research. The research assessment exercise is to favour research relevant to users more than in the past. But if higher education moves too far towards applied knowledge, the irony is that this may damage the economy because it may impair our national capacity to generate talent for broad-based problem-solving, disinterested consideration and original thought.
  If we commercialise and marketise higher education too far, we also risk losing the public values that we should respect in the universities and which the Government certainly do respect. Higher education is not just an annexe of the economic production line. Academics should address fundamental questions on our behalf. They should prepare students for democratic participation and social leadership, and they should speak truth to power. I hope that the Government will not overlook those important points.
  Finally, I shall say a word about pensions, as there is strikingly little mention of the subject in the spending review document. It states on page 159 that 3.2 million people will be on pension credit and 2.2 million will be receiving guaranteed credit by 2008, which the document acknowledges is a "stretching commitment" for the Department for Work and Pensions. The funding of pensions and the consequences of pensions policy are a major issue for public expenditure. We face looming problems in both the public and the private sector. The Government have been addressing aspects of pensions policy requirements piecemeal, and I believe this is a field where the Chancellor has not yet applied his own magisterial intelligence.
  The TUC is right to note with concern that fewer than half of people under 30 are saving for pensions. The defined benefit promises that the previous generation felt able to make will prove unaffordable. It is clear that the private sector is withdrawing wholesale from that commitment and, if not now, before long, the public sector will be in serious difficulty with it too. We are hearing about local authority pension scheme deficits. Part of the trouble is that local government employees contribute too little and people retire too early, presumably at the expense of council tax payers. Every time there is a new chief executive, he or she gaily restructures the senior management team, with a pension fund footing the bill.
  We used to be complacent about our prospects on pensions vis-à-vis Europe, but there is no more room for complacency. Radical reforms are needed. I hope my right hon. and hon. Friends will look carefully at the proposals from the Pensions Policy Institute and the National Association of Pension Funds for a citizens pension on something like the New Zealand model.
  We need a better basic state pension that is universal and based on citizenship and residence, not contributions. Only 14 per cent. of recently retired women are on a full basic state pension, so we do not have a universal state pension and we should have one. We should conflate the basic state pension and the state

  1493
  second pension to build a platform at or above the present means-testing level, which would be affordable now. We should then index pension benefits to national earnings. We would get rid of the complexities and disincentives that riddle the system such as contracting out and great swathes of means-testing, including pension credit. That would enormously benefit not only women, but low-paid people who earn less than the lower earnings limit for national insurance and carers, which is entirely consonant with the Government's commitment to social justice.
  Above the basic pension platform provided by the state, individuals should build their own schemes to which employers should be compelled to contribute. The evidence from the Association of British Insurers is that, where employers do not contribute, only 13 per cent. of employees save for pensions, but where they contribute 5 per cent., 69 per cent. of employees save for pensions. The Treasury should switch from tax relief to grants, because an enormous proportion of tax relief goes to people who are already well off and who least need incentivising to save. Whether that is the right pattern for reform—I think it attractive and practical—we cannot continue as we are for very much longer.
  The spending review is admirable. It was made possible by a disciplined and intelligent approach on the part of the Government, who understand the dynamics and interdependencies in our society. They are dedicated to strengthening our society, so that talent and energy find scope and reward. They support vulnerable people, who find that they are respected, cared for and have opportunity. And they particularly seek to improve life for children born in poverty. The title of chapter five of the spending review, "A Fairer Society with Stronger Communities", expresses this Government's ethic, a society in which the public and private realms flow into each other fruitfully and in which the values of community and personalised public services, which are therefore true services, are restored.
  5.32 pm
  Mr. Michael Fallon: It is a pleasure to follow the right hon. Member for Newport, East (Alan Howarth). I hope that Front Benchers noted some of his points about science and higher education, with which I agree. This afternoon's debate seems to be turning into an old Department of Education and Science reunion, although some of us have not changed our positions. I begin by declaring my business interests, as recorded in the register.
  I note that the review is no longer called the "comprehensive" spending review, which is probably a wise omission because it does not give us a picture of public expenditure as a whole. As the Chairman of the Treasury Committee pointed out, the spending review has been published before departmental out-turns are available. We heard evidence this morning that that is an accident, because 14 days' notice must be given to the National Audit Office, the Office for National Statistics or somebody, so the departmental out-turns cannot be published until Monday. That is either incompetence or conspiracy, or, as I prefer to think, the spending review is a political exercise that has been rushed forward in this particular year to try to influence the results of tomorrow's by-elections.
  1494
  The review does not include the all-important Atkinson report on public sector productivity, and I do not know why the Government could not wait for its conclusions, which would have enabled all of us more accurately to examine the efficiency targets. On the targets themselves, we have been told that the measures, which are now called the efficiency technical notes, will not be published until October. Sir Peter Gershon, an admirable man, has toiled away for a year on his report, and the Government have had two years in which to prepare the spending review, so I do not understand why the efficiency technical notes are not ready to be published alongside the efficiency targets.
  That point is all the more important when one considers some of the woollier targets. The Department for Culture, Media and Sport is pledging itself to save some £260 million a year by 2007–08. It has four plans to achieve that, the fourth of which is simply to
  "work with its sponsored bodies, local authorities"
  and other Departments
  "to facilitate the delivery of these … gains."
  That is not a specific plan. Such an objective should be properly measured: that is why the efficiency technical notes should have been finalised and published alongside it.
  The spending review document does not include crucial information that we need about the uprating of benefits. The Government blandly commit themselves to yet another reduction in child poverty, which is a very important target, but the totals for managed expenditure given in table A1 reveal that for the second two years 2006—07 and 2007–08—there is no assumption that tax credits, including the all-important child tax credit, should be uprated by any more than inflation. In other words, there is no assumption that the child tax credit will be uprated by the level of earnings growth, as is necessary if the target is to be met. The document has serious weaknesses, and I suspect that it has been rushed forward for political purposes. I regret that it does not provide the supplementary information that we need and that it does not give the Treasury Committee sufficient time to produce a report, as we normally would have done, that might better have informed the debate.
  It emerged in evidence given to the Committee this morning that the reduction in head count through the sacking of 100,000 civil servants will provide only between 10 and 15 per cent. of the proposed efficiency savings—the magical figure of £20 billion. In other words, 85 to 90 per cent. of the £20 billion has to come from everything else that is promised—better procurement, better working, lower sickness rates and so forth. In reality, better procurement often means more centralised procurement. The Government have already run into difficulties in forcing their way towards better NHS procurement because of objections from the devolved and empowered primary care trusts.
  On better working, I am, like my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), sceptical about how some of the targets will be met. In the case of the Department for Education and Skills, we are told that 30 per cent. of its £4.3 billion savings—a total of £1.3 billion—will be provided by teachers and college lecturers working harder. I see nothing in Gershon or in any other document to give us any

  1495
  comfort about those savings being delivered in practice. It is noteworthy that when Sir Peter Gershon consulted the devolved units on the efficiency gains that they could deliver—contacting more than 60 police authorities, more than 100 health service trusts, and more than 100 local authorities—only 12 health service bodies and 12
  local councils responded. I suspect that the Government will find it much harder to enforce such savings on the devolved public services.
  The 2.5 per cent. efficiency saving is an enormous amount—I agree with the hon. Member for Twickenham (Dr. Cable) about that. The annual average productivity improvement in the economy over the past 40 years has been 2.1 per cent., yet we are suddenly told that the public sector will be 2.5 per cent. more productive. Like my right hon and learned Friend the Member for Rushcliffe, I suspect that that is a rain dance.
  I want to consider the fiscal position, to which there are three keys. Each is critical to the Government's obeying its fiscal rules and our being spared the additional tax burden that Conservative Members feared and that was realised after the last two elections.
  The first key is that tax revenues have to come in. There is already evidence that they are not coming in as the Treasury forecast that they should. Secondly, the Government must deliver the asset sales that they promised. The document mentions a total of £30 billion of asset sales, yet I cannot find a single list of what will be sold to deliver them by 2010. As we found in Government, asset sales get harder as one goes on. One sells the land and privatises the industries but the search for the £4 billion, £5 billion or £6 billion of asset sales that one needs every year gets increasingly harder. It should therefore perhaps be no surprise that the Government have not even listed where the asset sales will be made. They are unlisted, unquantified and will become much harder to achieve. As I said earlier, if efficiency savings—the third key—are not achieved in full, we shall be in trouble.
  The Government will be in trouble because the one certainty is not asset sales, tax revenues or efficiency savings, but spending. The spending is guaranteed and will now begin to flow, whether or not efficiency savings are realised, asset sales are pocketed and tax revenues come in. If the three keys are not achieved, taxes and borrowing will have to increase all over again.
  As my hon. Friend the Member for Arundel and South Downs (Mr. Flight) said, we have the largest state sector in the Anglo-Saxon world. We have a public sector that is larger than Scotland and we have slipped down the competitiveness league. It is a stark fact that if British GDP per head were measured against that in each of the American states, we would come 45th. Only four American states have a lower GDP per head than ours.
  We have had seven years of rising administrative spending. The Chief Secretary tried to bluster his way out of the figures, and I commend the table in this morning's Financial Times to him. It clearly shows that administrative spending has increased from 4 per cent. to 4.5 per cent. The right hon. Gentleman promised to
  1496
  reduce it to 3.7 per cent. but the table shows how the Government have always promised to reduce it and always failed.
  There has been a lack of genuine, radical reform in our public services and a massive increase of more than 500,000 jobs in the public sector. That is real Labour. They start by spending and hiring more and more public servants and end so desperate to find savings that, suddenly and without warning, they send out 100,000 redundancy notices to their civil servants. Those 100,000 civil servants will see through the Government when they are put out of work. When the rest of the country sees through the Government, they will be put out of work, too.
  5.44 pm
  John McDonnell: I preface my remarks with the traditional statement of fealty or loyalty to the Chancellor and all his works. From the Budgets that he has introduced since 1997, my constituency has gained for the under-fives a Sure Start centre, a neighbourhood nursery and an early excellence centre. We have gained three schools—a primary school and two secondary schools—although I have to say that one was a private finance initiative that was imposed on us. I met the head of that school this morning, and we are not sure whether Jarvis will go bust over the summer so we are slightly anxious about that. My constituency has gained two medical centres, one of which I opened last week, and a mental health unit. We are also bidding for a new hospital. There is now neighbourhood policing in some of our wards, and it is developing throughout the others.
  That represents a programme of traditional Labour policies of investment in the community, of which I am proud. Especially welcome this week was our commitment to the development of international aid to a level that this country has not seen before and for which the United Nations has been calling for a number of years.
  However, the Budget statement and the spending review statement were tarnished by the treatment of the Government's own staff. They are the very people who deliver all those services and policies in my constituency and across the country, and we have treated them badly. We have used some of the worst employment practices of the worst employers. In the Budget, without any consultation, discussion or negotiation with the trade unions, the Chancellor announced 40,000 job cuts. In the spending review, it was announced—again without consultation—that there would be 100,000. Is it 100,000, 84,000 or 96,000? I am not sure. Certainly, it is now acknowledged that there will be compulsory redundancies. We need clarification on the precise numbers. The Scots have already revolted, and Jack McConnell has said that the 20,000 job cuts will not be imposed on Scotland by an English decision. What does local government have to say about the individual impositions of job cuts that will be made, council by council?
  I have always found the staff who work for the Government throughout the civil and public service to

  1497
  be committed, dedicated and hard working. They are generally overstretched, and often over-stressed. I believe that we have the best civil service in the world—certainly in terms of probity, efficiency and dedication to the work that it does. I accept, however, that any organisation—whether a government or private sector body—will periodically need to examine how its staff deliver the objectives of that body. That is healthy and worth while, although reorganisation can sometimes become a displacement activity for real performance.
  Nevertheless, it is worth focusing our minds on how we deliver new methods and increase efficiency, and that is usually done in one of two ways. The first involves external intervention. We had that in local government through rate capping, and it can also occur in the private sector when a company's share price drops and there is a need for urgent reform. Such external intervention demands a response, although the response is often to slash and burn, as has been mentioned in previous debates.
  The alternative is internally generated reform, which is what I would have expected from this Government. It is a more inclusive form of change, whereby we challenge the role of organisations and involve managers and staff at every level. In particular, we involve the union representatives of those staff members to discuss the resources that are needed and how they are to be deployed and developed to achieve the organisation's objectives.
  With Gershon, we seem to have an approach that epitomises the former—the external threat—but which is dressed up as the latter, that is, some form of organic efficiency response based on discussion. There is a suspicion that, instead of the development of the real objectives that we want to achieve and the resources that we need, the Gershon approach is based on the achievement of a cuts level, forcing the Departments to stack up the sacrifices to be delivered over the coming period. I found it somewhat enchanting that it was dressed up in consultancy-speak. For example, "change agents" are to be placed in every Department, and I look forward to examining the "generic reform maps" and "e-enabled channels" in more detail as we go along.
  The staffing element of the proposals smacks of a political manoeuvre, in which we are involved in some kind of Dutch auction with the Conservatives on how brutal we can be towards bureaucrats, and how many staff we can cut, in a competitive game in which the numbers increase month by month. They have increased from 40,000 in the Budget statement two months ago to 100,000 in the spending review. What I find unpalatable is that we now wrap that up in the mythical division between backroom and front-line staff, whereby slashing backroom staff will in some way free up growth of front-line staff. We now have a similar concept to that of the deserving and undeserving poor: deserving frontline staff and undeserving civil servants working in the backroom.
  From my experience of working in the public sector, and even in the private sector, and of engaging with those civil servants who serve my constituents, I cannot see the breakdown between deserving front-line staff
  1498
  and undeserving back room staff. In my local jobcentre, the pension worker who meets and greets, obtains information and provides immediate advice is of course valuable, but we also require the back-up of those backroom specialists who will analyse and process the payment, address the details of that claim, and ensure that it is done efficiently. The experience of Members is not that there are too many staff at the moment delivering benefits, pensions and so on—most of us have to deal with problems in our surgeries of ensuring that sufficient staff attention is given to our constituents because of the overstretch of existing staff.
  The announcements in the Budget and the spending review must be demoralising for existing staff, and must arouse fears among our constituents about service delivery. Those fears will be justified—services will be affected if we go for this scale of cuts. It is also an act of provocation to the unions. The union response, however, has been considered and has shown admirable restraint. I pay tribute to the general secretary of the Public and Commercial Services Union, Mark Serwotka, for the statements that he has made in the media about the need to achieve a rational approach by the Government, and about his willingness to negotiate and get involved in consultations. I appeal to the Government to start again that process of reform as a rational process, in which we engage the staff, their managers and their unions. This could be a real opportunity for reform and a renewed direction in the civil service, if that is what we want to achieve, but it must be done with the encouragement and participation of all the staff, particularly through their trade union structures, in which they have confidence. We have that opportunity, but it could be lost if threats of job losses and compulsory redundancies are handled in this brutal manner.
  On Monday, I requested a meeting with the Chancellor to discuss with the PCS parliamentary group the implications of his announcement. His response was that we had met the Economic Secretary days before. That is slightly inaccurate—we had met a couple of months before, and it was a meeting with the Economic Secretary about the pay round in the Department for Work and Pensions and across government; it was not about staff cuts. I would welcome a meeting with the Chancellor and any other Minister to discuss this in some detail. There is a real opportunity to get back on course in a reform and renewal process that will deliver the objectives of Government and that may deliver an element of savings, too. Those will be achieved efficiently and effectively only if we take the staff with us—they will not be achieved if we announce that we are going to decimate their employment opportunities for the future.
  Finally, there is failure by the Government to acknowledge that if we want staff to undertake work effectively and efficiently, we need to pay them a reasonable rate for the job. In the Department for Work and Pensions, for example, 90,000 staff earn less than £15,000 a year, and the starting rate for many of those posts is £10,000. Many of them pay themselves the benefits that they must administer, because they are on low pay. There is a chance for a fresh start for our civil service, but it will not be brought about by threats of job cuts or by underpayment in this scandalous way.
  5.54 pm
  Adam Price: It is good to follow the hon. Member for Hayes and Harlington (John McDonnell). As a fellow member of the PCS parliamentary group, may I echo his call for an urgent meeting to discuss the Government's proposals? I was as horrified as he was by the scale of the job reductions, the manner in which they were announced, and the impact that they would undoubtedly have on communities throughout the United Kingdom if the Government proceeded with their proposals.
  "Tax and spend" has always been something of a lame clichè when used to describe the fiscal stance of a social democratic Government. "Axe and spend" is something of a departure for a Government who still purport to be a Government of the centre left. However, I have learned that it is always a good idea to start with a few warm words of welcome, and I welcome one feature of the spending review. A public service agreement target for regional economic policy, introduced at the time of the last spending review, is still there and indeed has been strengthened in a sense. The Government have committed themselves to demonstrating progress in reducing the persistent gap in growth rates, albeit between English regions. I think that it should be extended to cover the whole United Kingdom because the Treasury retains that wider responsibility for economic performance; but the target is there, and progress must be demonstrated by 2006.
  While I welcome that target, however, I must ask how the Government will achieve it. We have the Lyons report, but the right hon. Member for Dumbarton (Mr. McFall) drew attention to the inconsistency between Lyons and Gershon—the fact that the Government are giving with one hand and taking away with the other. That is borne out by the details of the proposals. The biggest job cuts involve the Departments that are most dispersed, and least represented proportionally in London and the south-east of England. As Sir Michael Lyons points out, the most dispersed is the Department for Work and Pensions, just 17.5 per cent. of whose employees are in London and the south-east. The Ministry of Defence has 28 per cent. in London and the south-east, and the Chancellor's Department 25 per cent. Those three Departments, which were ahead of Lyons—which had already dispersed many jobs outside London and the south-east—are the very ones targeted by Gershon.
  What is the impact of that? The right hon. Member for Dumbarton asked for a regional breakdown of the efficiency review job reduction targets, and we should like to see one, but I have made a quick calculation myself. Thanks to the Lyons report, we have a detailed breakdown of the proportion of staff in the various Departments who are in London and the south-east vis-à-vis the rest of the country. If those figures are applied to the departmental breakdown in the Gershon report, it emerges that 63,000 of the 84,000 jobs lost will be lost outside London and the south-east.
  The poorest, most economically disadvantaged parts of the UK will bear the brunt of the Gershon proposals, and will do so disproportionately. At present 70 per cent. of civil servants are based in the rest of the UK, while 30 per cent. are in London and the south-east. Under the Gershon proposals, 75 per cent. of jobs will be lost outside London and the south-east. Lyons offers
  1500
  us 20,000 jobs, but 63,000 will be lost in the north and west of the UK. There will be a net loss of 40,000, and given the multiplier effect of 1.5 in the Government's own Lyons review, another 20,000 will be lost in the private sector.
  Of course, we cannot even be certain about the 20,000 jobs mentioned in the Lyons review. Only 30 per cent. of Departments are able to state whether such relocations will happen by 2010. Sir Michael Lyons himself says that, as a result of the Gershon review,
  "one implication … is that the figure of 19,700 may come down somewhat".
  Such a lack of precision about the relocation of jobs is in contrast to the steely determination that the Chancellor has shown in carrying out the cuts. He said that the civil service unions should be in absolutely no doubt that the Government will go ahead with these reductions, and that they are both necessary and going to happen. So there we have it: there is certainty in respect of the cuts, but doubts abound about the relocations.
  I agree with the hon. Member for Hayes and Harlington that the lack of consultation with work force representatives was appalling. That is true not only of the first tranche of losses, which were announced in the Budget, but of the second and wider cull that formed part of the spending review. Yesterday, Dave Prentis of Unison rightly said:
  "These issues should be dealt with through the established procedures and not announced through the media, which add to people's insecurity".
  The Government have been quick enough to condemn—and rightly so—private sector companies that announced large-scale redundancies in the media without advance consultation. I am thinking of Corus, Rover and Marks and Spencer. The Labour party manifesto of 2001 stated:
  "When large-scale redundancies are being considered, there is an especially strong case for consultation."
  On Monday 7 July 2003, Labour's website ran the following article:
  "Workers set to gain consultation rights … Trade and Industry Secretary Patricia Hewitt said she wants the changes to lead to an 'no surprises' culture at work and 'an end to the climate where people only hear about job losses from the media, over their breakfasts."
  If that were not enough, the Leader of the House said in "Progress", the Brairite in-house magazine, that because Labour believes in rights at work, it will extend information and consultation rights to end the scandal of workers learning that they have lost their jobs by text message. So there we have it: redundancies over breakfast conveyed in the media and by text message are wrong when carried out by the private sector; but redundancies at teatime conveyed by ministerial statement in this House are okay when carried out by the Government. Indeed, they are better than okay. According to a Wales Office press release, they were an "exceptional result" for Wales and a "once in a generation" step change. In one sense, they were exceptional—exceptionally bad—and it certainly was a once in a generation announcement. To my mind, it was the single biggest Government announcement of public sector job cuts since the pit closure programmes of the 1980s.

  1501
  To sack one's own employees is bad enough, but to sack somebody else's beggars belief. We were not only told of 84,000 job losses, but reference was made to the curious figure of 20,000 losses across the devolved Administrations and in local government. Rhodri Morgan, the First Minister of the Welsh Assembly, has been busily backtracking on those figures. He said yesterday:
  "They are not estimates we have come up with and we are the responsible body in Wales."
  He was clearly surprised and, I would imagine, probably a little angry about being bounced into that by the Chancellor. It now seems that the Treasury is saying that it plucked the figure out of the air. It was some sort of nominal, indicative figure and the Treasury had not consulted the local government bodies or any of the devolved Administrations.
  All that happened despite the anxiety caused for employees of the Welsh Assembly Government and despite the fact that it undermines the autonomy and authority of the devolved Administrations. It even breaks the memorandum of understanding signed by the Government on communication and consultation. According to that memorandum:
  "All four administrations are committed to the principle of good communication with each other, and especially where one administration's work may have some bearing upon the responsibilities of another administration."
  Yet Rhodri Morgan did not even know that the Chancellor was going to make a statement about job reductions in Wales and elsewhere across the UK. We also have to ask whether the devolved Administrations were consulted on embracing the idea of local pay, as contained in the spending review. We not only get fewer jobs, we get existing jobs at reduced pay with no consultation with the workers or the National Assembly for Wales.
  I did not disagree with every single line in the spending review. It states on page 178:
  "Performance in public service delivery and economic development varies across the regions and countries of the UK".
  It most certainly does. We have had dismal economic growth records. Growth in Scotland, for example, has been half that of the UK over the past seven years, and Welsh NHS patients face an appalling waiting gap. Pauline Purdey from Bargoed has been waiting nine and a half years for a hip operation and is still waiting.
  Why is there such varied performance across the UK? The reason is clear and it is the Treasury's responsibility because the Barnett squeeze is biting very hard in Wales. The figures in the spending review show the increase in the National Assembly's budget over the period covered as 4.5 per cent., compared with 7.1 per cent. for the NHS in England. The only way in which the Labour Administration in Cardiff will be able to match the increase in England is by raiding other budgets. The same applies to education. The increase is 5.7 per cent. in England—so if Wales is to match those improvements and is so far behind, it will have to raid other budgets.
  Mr. Grieve: I am intrigued to hear the hon. Gentleman refer to the Barnett squeeze. As he and I are aware, the Barnett formula delivers substantially more
  1502
  expenditure per head of population in Wales than it does in England. Admittedly, it is on a falling graph, moving towards a position of eventual parity in about another 20 years. Is the hon. Gentleman suggesting that, in the meantime, Wales is disadvantaged in respect of per capita expenditure?
  Adam Price: The hon. Gentleman is right that it is an equalisation formula, so year on year the gap that he describes gets less. That is the Barnett squeeze. If we look, for example, at per capita health spending, most people would accept—it is borne out by the figures on chronic sickness—that Wales has one of the worst health profiles in the UK. Of the 12 standard UK regions, we are now fifth in respect of per capita health spending. We were third only four or five years ago and have been overtaken by the north-east of England. London has far higher per capita health spending than Wales but, as I say, we have been overtaken by the north-east and we will be overtaken next year by the north-west of England. There is currently only £5 per head difference.
  The Barnett squeeze is having a real effect in Wales. It is impacting on the Welsh Assembly's ability to reduce waiting times. The public service agreements for health refer to a period of 18 weeks, but 18 months is the standard in Wales, and the waiting gap has increased. The only way to correct matters is to reform the Barnett formula. The spending review refers to Professor MacLean of Nuffield college, who is one of the strongest advocates of scrapping the Barnett formula, on the ground that it does not deliver territorial justice across the UK's regions and countries.
  I end by noting that the First Minister of the Welsh Assembly this afternoon announced that there will be a bonfire of the quangos. It will be dramatic: the Welsh Development Agency, the Wales Tourist Board and the Welsh Language Board will all be abolished. I hope that that is not how he intends to meet the job reduction targets, but I urge the Government to add the Barnett formula to the bonfire. We will never achieve territorial justice for Wales, for the south-west or north-east of England, or for any part of the UK while that formula stays in place.
  6.11 pm
  Mr. Tom Clarke: I have listened to almost all the debate, but I apologise to the hon. Member for Twickenham (Dr. Cable) and to my right hon. Friend the Member for Newport, East (Alan Howarth), as I had to leave the Chamber to chair an all-party group on disability with Lord Rix.
  The debate has been very interesting. The right hon. and learned Member for Rushcliffe (Mr. Clarke) has left the Chamber, having been here for most of the afternoon, but his remarks were of particular interest. Like other Opposition Members, he found himself in some difficulty. I recall how, when in government, he was defeated when he sought to persuade the House to increase the value-added tax on pensioners' fuel to 17.5 per cent. He predicted that the most dreadful things would happen if we did not approve his proposal. He also made dire predictions about what would happen if we introduced the minimum wage.

  1503
  The right hon. and learned Gentleman, in opposition, has repeated those terrible predictions over the past seven years. I am sure that he will forgive me if I say that they have become even less convincing, given his record in terms of astrology, if not of economics.
  The Opposition have had to deal with the problem that the statement by the Chancellor was an indication that he has succeeded in reforming the economy. For example, the low level of inflation must fill the former Chancellor with envy. The consistently low level of interest rates has helped those of my constituents who aspire to home ownerships. Interest repayments on debt are much lower, and growth is high. All those factors have contributed to the economy's strength and stability.
  I shall concentrate on what is happening in my constituency of Coatbridge and Chryston, especially in respect of employment and the new deal. The transformation that has taken place in my area would not have been possible without the economic policies that the Chancellor has pursued.
  Before 1997, debates such as today's were dominated by the problem of unemployment. How could it be otherwise? My constituents accounted for more than their fair share of this country's total of 3 million unemployed—even at a time when we enjoyed the benefits of North sea oil revenues. Whatever disagreements might have emerged in the debate, I am delighted to say that today we are focusing on employment. We are rightly talking about job potential in terms of the new deal. We are thinking of a new agenda, as well as of what has been achieved. We are thinking of how the new deal can be improved to offer better quality jobs to those who benefit from it. I invite the House to focus on how we can build further on the excellent achievements of the new deal. Discussions on the new deal can appear somewhat abstract, but nearly 90,000 young people are participating in it as we speak. In Scotland, some 129,200 starts have taken place, 10,200 of which were for young people. In my own constituency up to March 2004, the new deal appealed to 2,031 people.
  Those statistics—we must not forget that they deal with real people and families—show that we are well on our way to full employment. The Beveridge ideal is an idea whose time has come. That fall in unemployment offers the foundation for this year's spending review: by freeing up resources that would otherwise have been spent in propping up unemployment, we are able to invest in those essential services—health, education and transport—that are so important to my constituents and throughout Britain.
  It is important to build on the success of the new deal so that the tremendous progress we have achieved can be enhanced still more. My constituents want to see that happen, and I hope that Department for Work and Pensions will ensure that the additional resources that the Chancellor made available in his announcement on Monday will allow it to focus on how it can improve still more on its approach to the new deal.
  There are three key elements to that improvement. The first is ambition. We should all do more to encourage people's ambition to achieve better paid, more secure jobs. We should invest in skills and training so that people have the opportunity to obtain
  1504
  qualifications and move on to better jobs. I extend my plea for ambition to employers, who should be encouraged to become involved in the design of the new deal programmes. Rightly, employers have had plenty to say through their various organisations, including the CBI, but they should play an important part in providing the demand for highly skilled jobs. Our people will respond to that.
  The second element is leadership. We need to see more evidence of leadership in providing higher quality jobs through the new deal and other schemes. We need leadership to involve more people from disadvantaged groups, people with disabilities and those from ethnic minorities. Business and commerce today are capable of providing that leadership, especially in my constituency.
  The third element is capacity. The biggest employers in my constituency are the health service and North Lanarkshire council, which offers an excellent example by making skilled jobs available.
  There is an even greater challenge: to recognise that the resources made available matter as much to the users of services as to employers, and indeed to the House itself. As a former civil servant, I am sure that when the Chancellor said that there would be full consultation, he meant it. I look forward to that nationally and locally.
  Some weeks ago, I introduced an Adjournment debate on laryngectomy and talked about people who suffered from throat cancer and had to use voice boxes for the rest of their life. I referred to the work of the charity, Macmillan Cancer Relief, which had established that £20 million in benefits were not being taken up by cancer sufferers. The Lanarkshire Laryngectomy Association informed me that benefits of £2 million were not being claimed in the area, although people with cancer should have been receiving them.
  In light of Gershon, the Chancellor's announcement about shifting resources to the front line is extremely important. Benefits forms are comprehensive so people such as those cancer sufferers should have the opportunity of one-to-one interviews, with as much assistance and advice as possible. I know that the Government want to achieve that and that the House will endorse that view.
  In that spirit, I welcome the Chancellor's statement. It provides opportunities for my constituents and for people throughout the country. More than that, however—because employment leads to growth—it means that we are recognising, at long last, our international responsibilities. The Chancellor's record on that is unprecedented.
  6.22 pm
  Mr. David Ruffley: I apologise for not being in the Chamber for the Chief Secretary's opening speech; I was in Room 12 whipping a statutory instrument Committee.
  The Holy Roman empire was neither holy, Roman nor an empire. So it is with the independent review of public sector efficiency by Sir Peter Gershon; it is neither independent nor a real review, and it does not have much to do with efficiency in the real world. Gershon's review is a form of gesture politics, politically inspired by the Chancellor to con us that he is serious about inefficiency and waste—the inefficiency and waste to which he has contributed over the past seven years.

  1505
  Let us take civil service numbers. More than 500 new civil servants were hired every week in 2003. Civil service numbers increased on the Chancellor's watch from about 475,000 in 1997 to more than 515,000 at the end of 2003. Have we any faith that he will achieve civil service head count cuts of up to 100,000? Not really. It is much more likely that those posts will be rebadged and recycled. Serious cuts to the level that the Chancellor is predicting will not happen.
  For several months, permanent officials in Whitehall—one or two of whom I keep in touch with—have privately been deriding the Gershon review. As one of them told me,
  "it's all a bit of a joke—Gershon did a PowerPoint presentation a few months ago and made a few telephone calls to Departments on the back of it. You will find the document produced on the day of the CSR a bit thin."
  How right that official was.
  Gershon is short on serious detail. Why? Because Departments will not be able to tell us until the end of October exactly how those efficiency gains will be delivered. Why did the Chancellor not wait until that work had been done before announcing his figures? I will tell the House why. He was running scared of the Tory attack on waste. He was behind the game, and he realised that the James review was making the running. We will identify how profligate the Chancellor has been in the use of taxpayers' money over seven years.
  As my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) made clear, smarter IT systems, better procurement and even cuts in the headcount will not in themselves deliver £21.5 billion in efficiency savings. As he and those on the Conservative Front Bench identified, that requires policy change, which is what the James review is about and why our approach is so different from Gershon's. Yes, it involves looking at closing down, in whole or in part, Departments such as the Department of Trade and Industry—any residual function can be moved to another Department—and, yes, it involves closing down wholesale the regional development agencies: policy change, not paperclips.
  Only now—perhaps the Minister will reply to this—have the National Audit Office and the Audit Commission been enlisted to draw up detailed plans on how each Department should meet its targets. Why did the Chancellor not do that years ago, or, better still, a few months ago? That would have been nice and helpful. All that looks like seat-of-the-pants stuff from where I am standing. Even worse, no one is sure how the monitoring of Departments' success or failure in meeting those targets will be measured. It is estimated that only 60 per cent. of the £21.5 billion target for savings is cashable—that is, a monetary value can be ascribed to each cut. It is very easy to identify what will be saved by cutting the headcount. It will probably be easy to identify more efficient, cost-effective procurement. However, let us take a look at the documents produced in relation to the Home Office, whose target for efficiency gains includes
  "substantially increasing the proportion of officer time spent on front-line policing".
  Amen to that—an aim that we all share—but the Government cannot tell us exactly how it will be measured so that those efficiency gains can be counted towards the £21.5 billion efficiency savings total.
  1506
  Everyone agrees that measuring public sector productivity is a complex intellectual inquiry, but why has the Chancellor taken seven years to get round to it? Farcically, the Treasury failed to meet its own target, set in 1998, of delivering 2.5 per cent. in efficiency gains—ironically, the same target for savings as that given to Departments in this year's CSR. At that time, the Treasury said that it could not work out how to measure its own output, and it cannot do so today. We must wait until October before it even gets close to telling us how that will be delivered and measured adequately. Ministers might reply that Sir Tony Atkinson will deliver his interim report. Yes, but he will do so next week, and the report is unlikely to give us the detail, Department by Department, on how the targets will be met. That is not just my point; it has been made on behalf of the Treasury Committee by the right hon. Member for Dumbarton (Mr. McFall), having heard all the objective evidence from witnesses this morning, and the point was echoed and reinforced by my hon. Friend the Member for Sevenoaks (Mr. Fallon).
  The documents produced this week demonstrate that the Chancellor's approach is to spend first big time and ask the really detailed and important questions later—very much later. I trust that, when we publish the James review before the next general election, we will do what this week's set of announcements has not done: explain how serious efficiency gains can be delivered. That will require programme change and, above all, involve the introduction of the right to choose in our great public services—schools and hospitals. I look forward with relish to debating the James review and the Conservative alternative later this year.
  6.29 pm
  Mr. Dominic Grieve: It has been a pleasure and, from my point of view as the shadow Attorney-General, an education to sit in on the debate and hear hon. Members' contributions. Generally speaking, my role confines me to the spending end of things, rather than looking at how money should be allocated.
  Mr. Boateng: To what do we owe the honour?
  Mr. Grieve: As I have a heavy involvement in the departmental responsibilities of the Home Office, in addition to my responsibility as shadow Attorney-General, which does not relate to a heavy-spending Department, I thought that it might be interesting to scrutinise the way in which the Chancellor has approached spending in the Home Office, which I shall address in a moment.
  The debate has highlighted several interesting points of view, and I was struck forcefully by its aspects on which there was cross-party consensus. The right hon. Member for Dumbarton (Mr. McFall) pointed out with great care that he was extremely concerned about how the Chancellor was going to meet his golden rule on expenditure. His speech was made all the more compelling and interesting because it immediately preceded that made by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), who said exactly the same thing and expressed exactly the same concerns, albeit using slightly different language.

  1507
  It is apparent that the Government have taken on a phenomenal task. On the belief of speculative receipts, they intend to continue to increase public expenditure further. At the same time, they clearly feel constrained because they are worried about whether that can be delivered, so they are having to ratchet up more than £20 billion of savings to help to subsidise it. I can think of few worse moments to try to make efficiency savings in Departments than the time at which they are also asked to expand their expenditure. That will maximise the likely stress that such Departments will be under. The Government have thus taken on what can be described only as a mammoth project.
  I listened carefully to the Chancellor on Monday. His speech contained all the traditional new Labourspeak—we heard of more bureaucrats, seven new agencies and 110 further targets. There will undoubtedly be more borrowing and we can be satisfied that there will be further taxation. We already know that higher council tax is inevitable and, although the Prime Minister tried to suggest today that that would affect only the wealthy, I am rather doubtful. I suspect that the council tax squeeze that will be experienced throughout the country will affect everybody, including the poorest. That is an inevitable consequence of the expansion of expenditure that the Chancellor has projected.
  The publication of the Gershon report represented the first occasion since I came to the House when I suddenly realised that I was not at a significant disadvantage as a member of the Opposition. The Minister will know that Oppositions go through periods, especially close to elections when they have to set expenditure targets, which the Government usually rubbish. That process inevitably involves shadow Ministers identifying savings that might be made in the Departments that they are about to take over. I have been through that process at least once and I daresay that we are embarking on it again. I have been struck that, after meeting and speaking to people, one is always left with two situations. First, when nothing else can be cut, we say that we will make efficiency savings because that always sounds like the easiest thing to do. Secondly, we say that we are not confident that all our fact and figures are right. Of course, we say that because we do not have hordes of civil servants helping us. Yet when I opened Sir Peter Gershon's proposals, I saw that, in terms of content, the document is identical to the sort of document that I would expect an Opposition to produce without all the support services. It is about as thin a document as it could possibly be.
  I do not know whether the Minister intends to publish the details of how the efficiency savings will be carried out, the guidance documents and the dialogue that has taken place. I simply say to him, in the spirit of cooperation, that if he wishes to persuade the House that the savings are deliverable, we will need something better than the managerial gobbledegook contained in the document which, frankly, does not amount to a row of beans. It is easy to claim that it is possible to make £20 billion of efficiency savings, but how those are carried out in practice is another matter.
  If one reads Gershon or listens to the Chancellor, the one thing that does not appear to be the case is that the Government are carrying out a spending review that completely reassesses the activities in which they intend to get involved. There is none of that and, in those
  1508
  circumstances, Gershon is an extremely shallow document. I hope that the Minister will enlighten us on whether he will provide us with further information on which we can make a judgment as to its efficacy. My hon. Friend the Member for Sevenoaks (Mr. Fallon) also commented on that.
  What brought me to the Dispatch Box was the matter of my own shadow spending Department. When one looks in detail at what is proposed, one can assess whether what is being offered by the Government is valid. The Treasury released a press statement on the Home Office that makes entertaining reading, including the statements on how everything is so wonderful in the best of all possible worlds. It went on to identify what the extra money will be spent on. It was at this point that my antennae started to quiver as I considered the astonishing omissions from future Home Office spending.
  Let us start with the most basic, most important and probably least popular problem. The Government face the biggest crisis in prison numbers ever experienced. Some 75,000 people are in prison and the prisons are at breaking point. The Government cannot deliver the programmes that the Prison Service needs to rehabilitate offenders because of the churn, which means moving prisoners around from one prison to another. As long as that continues, all the Government's aims to reduce crime through rehabilitative sentences cannot work, but the press release makes no mention of a prison building programme.
  We are told that correctional services will be modernised by creating the National Offender Management Service and reducing reoffending. That does not exactly reflect a Government who are getting to grips with one of the key issues in a spending Department. Then we are told that the money is going to be used to increase neighbourhood policing and provide 20,000 community support officers, from which I infer that the current increase in police numbers, which has generated 11,000 officers, is not going to be pursued.
  We have had endless debates with the Government about the efficient use of resources, but if they want to reduce crime, which costs the country £60 billion per annum, they will have to target investment in the right place. My belief has always been that only a substantial increase in police numbers will enable the Government to introduce community policing on the American scale, which has a proven record of crime reduction. That is a classic illustration of the Government's failure on expenditure. They intend to spend more money but, when it comes to the crunch, they are unwilling to make difficult decisions that could result in long-term, substantial savings to the Exchequer as well as benefits for the national economy. It beggars belief that they should come up with a series of ersatz solutions to crime problems.
  Most extraordinarily, we have been told that the money will be used to curb illegal immigration, as I mentioned earlier, even though the Government have never given us a target and cannot enlighten the House about the levels of illegal immigration. I would therefore be grateful if the Minister would ask the Chancellor of the Exchequer to tap the Home Secretary on the shoulder and say, "How can I measure your success in reducing illegal immigration when I have no statistics on

  1509
  the problem or, indeed, your efficiency in dealing with it?" In a spending review, such basic issues need to be addressed.
  The hon. Member for Rochdale (Mrs. Fitzsimons) made an interesting speech about Sure Start.
  Mr. Boateng: It was a very good speech.
  Mr. Grieve: Indeed, but the hon. Lady highlighted the fact that Sure Start is area-based. There is a desire not to stigmatise children by targeting individuals who could benefit from the programme, so the area is targeted instead. I suspect that she is aware of the evidence that shows that Sure Start does not reach those who need it most. If the Government want to maximise their expenditure and become more efficient, the Home Secretary should talk to the Chancellor and introduce his own Gershon review to see whether targeting is working effectively. I am a great supporter of Sure Start's aims, but the programme has many inefficiencies.
  Mrs. Fitzsimons: The hon. Gentleman may wish to reconsider his comments in the light of published evidence showing that all Sure Start programmes, even the newest ones, have a significant impact. The child poverty review refers to some of those programmes and I am sure that the Minister for Children can furnish him with examples because Sure Start is the most successful Government programme in this area.
  Mr. Grieve: I was not suggesting that Sure Start was unsuccessful. I have seen some extraordinarily successful examples of the programme, but I have seen others that are not working very well—it depends on the area. Area targeting inevitably means that some members of the client group to which services are directed do not receive them. At the same time, people whose need is not as great are receiving those services. I simply wish to raise the issue and have a mature debate about efficiency. If the Government want to maximise efficiency, they need to look at that problem.
  Turning briefly to the improvements in productivity and the envisaged release of resources to the front line, the Home Office is supposed to generate £2.3 billion of annual efficiencies along with the Department for Constitutional Affairs and the Crown Prosecution Service by 2007–08. That includes a contribution of £1.97 billion, from the Home Office, which is a colossal sum. How on earth will that be achieved? How does it square with the fact that the administration budget, on the Government's own projections, is due to rise from £697 million to £733 million before it peaks? The figures are completely unrealistic, so I would be interested to hear the Minister's justification.
  I shall conclude, because I am conscious that I am running out of time and wish to hear the Minister's reply. On a completely different note, I listened carefully to the hon. Member for East Carmarthen and Dinefwr (Adam Price), who spoke about the health service in his constituency and the Barnett squeeze. My constituency, like the rest of the country, has had seven years of Labour government. It receives 18 per cent. less than the national average per head expenditure on health
  1510
  services. Over a seven-year period, the health service has been progressively impoverished and the quality has deteriorated, yet my constituents, because many of them are wealthy, are the principal milch cows that serve to fund Government spending. They are appalled at the way the Government have presided over the catastrophe.
  I have one major hospital, which is riddled with MRSA. Its maternity and paediatric departments are being closed and moved 20 miles away. The quality of mental health care is abysmal. It is nothing short of a national scandal and is entirely due to the Government's mismanagement of resources. I share with the hon. Member for East Carmarthen and Dinefwr the view that the £34 billion of extra expenditure that the Government are spending per annum on the health service has been wasted. I should be delighted to know where it has gone, as I fear that most of the programmed expenditure will be wasted, too.
  6.45 pm
  The Economic Secretary to the Treasury (John Healey): This has been a telling debate. The Conservatives pose as the party of choice, and it is clear from the contributions of those on the Opposition Front Bench and their right hon. and hon. Friends on the Back Benches that the British people are indeed offered a choice. That choice is between the vision and the plan set out by my right hon. Friend the Chancellor in the Budget and the spending review, and the prescription for failure set out by the shadow Chancellor in his speech to the Bow group in February.
  The choice is between the Labour Government holding on to economic stability and tough fiscal rules, as set out by the Chancellor, meeting our commitments on taxation and planning to continue with historically high and rising investment in education, health and essential public services, and the prescription set out by the shadow Chancellor, who has said:
  "I have agreed with my Shadow Cabinet colleagues that the baseline for spending across all of these departmental budgets will be 0 per cent. growth for the first two years".
  Two years of cash–freezing departmental budgets would mean real cuts for every Department.
  Instead, we plan to combine the longest period of sustained economic growth for two centuries with the longest sustained investment in public services for a generation. The Conservative alternative, as the hon. Member for Bury St. Edmunds (Mr. Ruffley) said, is driven by ideology and by the shadow Chancellor's fiscal arithmetic, returning to the same Tory policies that failed Britain in the past—under-investment in public services, charges for public services and deep, savage cuts in those public services and public investment. The choice is clear. Labour is committed to investment to secure the long-term strength and prosperity of the UK economy. The Tories are committed to cutting skills, training, investment in science, innovation and transport, and the new deal.

  1511
  Labour is committed to investing in the public services that people need and want. The Tories are committed to cutting them. Labour is committed to investing in the security of our country and safety on our streets. The Tories are committed to cutting the funding essential to our armed forces, our security services and our police. The Labour party is committed to investing to halve and then eradicate child poverty, to guarantee elderly people safer, warmer homes, and to give the world's poorest countries a chance to develop. The Tory party is committed to cutting the very measures that are bringing relief from poverty and greater fairness to our country and to the world. That is the choice at the heart of this afternoon's debate. That is the choice that faces the country now, up to and at the next general election.
  My right hon. Friend the Member for Dumbarton (Mr. McFall) set out a series of questions and concerns about how the efficiencies and reforms that my right hon. Friend the Chancellor announced would be put into practice. In particular, he asked about discussions with staff, and my hon. Friend the Member for Hayes and Harlington (John McDonnell) and the hon. Member for East Carmarthen and Dinefwr (Adam Price) made the same point. Each Department is discussing the work force changes with their employees and the recognised unions; each Department is examining the detailed staffing changes with the work force; and each Department is examining with the work force and the unions ways to ensure that the maximum opportunities are available for employees to reskill and redeploy.
  My right hon. Friend the Member for Dumbarton said that it was important to have a transparent process. The hon. Member for Beaconsfield (Mr. Grieve) asked for further information, and it will be set out in the efficiency technical notes, which will be a key mechanism in ensuring accountability during progress towards the headline target of £20 billion of efficiency gains. In order to ensure that the House and the public have confidence and that the measures command credibility, the Government are currently inviting the National Audit Office and the Audit Commission to scrutinise departmental ETNs before publication. Progress towards meeting the efficiency targets will be publicly reported, so the Government and each Department will be accountable for their results. I am sure that the Treasury Committee, which is chaired by my right hon. Friend the Member for Dumbarton, will continue to play an active part in The scrutiny process.
  I say to my hon. Friends in particular that I understand the work force's concerns and the concerns voiced by the unions, but the measure is the right thing to do. Putting resources into front-line services must be a priority for any Government, and any good Government make savings where they can. The measure is also required: if we want to invest in the provision of public services, it is necessary to free additional resources. The measure is right and it is required, and the changes and gains are realisable. The investment in technology and the redesign of some working practices show that it is possible to reduce backroom staffing and transactional posts while improving services.
  1512
  My hon. Friend the Member for Hayes and Harlington voiced some characteristically strong words of admonishment, but I share his end objective. He said, "This could be an opportunity for real reform, if it is done with the participation and consultation of staff and their unions." I endorse that view, which is constructive, and as chair of the Public and Commercial Services Union parliamentary group, he may have an important role to play in helping to meet that challenge.
  My hon. Friend the Member for Rochdale (Mrs. Fitzsimons) was right to remind us to "cut to the quick". In the end, what matters is what means most to people in their day-to-day lives. She argued for greater flexibility, so that plans and decisions are made not in Whitehall, but in the regions and local authority areas. I refer her to the series of devolved decision-making review reports, the latest of which was published alongside the Budget, and she will find that the approach set out in those reports is consistent with her arguments. She will have noted the continued support that my right hon. Friend the Chancellor set out for the neighbourhood renewal fund £525 million each year over the spending review period. She mentioned the safer and stronger communities fund, which is an opportunity for the ODPM and the Home Office to pool their budgets to make a difference locally, and I know that my right hon. Friend the Chief Secretary to the Treasury wants to write to her with more details.
  My right hon. Friend the Member for Coatbridge and Chryston (Mr. Clarke) discussed the transformation in his constituency as a result of the Labour Government's economic policies since 1997. He also discussed the success of the new deal for work, and I am sure that he will welcome the new deal for skills, which we propose to develop during the spending review period and which will help with many of the problems that he identified.
  The hon. Member for Twickenham (Dr. Cable) raised some serious, almost forensic, points, and I shall try to respond in kind. He asked about the make-up of cuts and the position of senior civil servants. We start from the point that it is right for Departments to decide on the exact details of staff changes and to do so in consultation with their staff and unions. All Departments have been set a flat or declining administration budget. Given that about 50 per cent. of administration costs are pay costs, they will need to control the overall pay bill, and that will be a factor in their decisions. The hon. Gentleman asked where the dividend, as he put it, would go from efficiency gains. Efficiency gains will remain within Departments. It will be for them to decide how to allocate those resources, and it will be their incentive to make those gains in order to redeploy to the priorities that they set out. I assure the hon. Gentleman that we have no illusions about the ease with which this can be done. It will be difficult, but it can be done.
  The right hon. and learned Member for Rushcliffe (Mr. Clarke) expressed similar concerns about how the efficiencies could be delivered. First, Departments have developed their programmes with Sir Peter Gershon, who has agreed that they are deliverable at this stage. Every Department has the incentive to deliver the efficiency gains because that will release resources that

  1513
  they can then spend on their own priorities. Secondly, since 1997 we have invested £6 billion across Government in new technology that will facilitate many of the savings that we can make. Thirdly, Departments will be accountable for the results of the efficiency measures that they take, which will be auditable and transparent. The National Audit Office and the Audit Commission will have a role not only in auditing the assumptions that Departments make and the measures that they use, but their progress against the measures once they are taken. Finally, Departments will receive specialist support on implementation and be challenged if their plans drift off course.
  My right hon. Friend the Member for Newport, East (Alan Howarth), who is a strong champion of his constituency, made a powerful case for Newport commanding the attention of Departments, in conjunction with Sir Michael Lyons, as a potential relocation venue for the 20,000 posts that will be redeployed from London and the south-east. I am glad that we were able to complete in the spending review the business that he left unfinished during his term as Minister. We have been able to extend the VAT refund scheme for university museums and to increase the budget of the national heritage memorial fund. I am glad that he welcomes those moves.
  The hon. Member for Sevenoaks (Mr. Fallon) made some important points about the potential for efficiency gains in relation to productivity, administration costs and asset sales. Let me respond to those in detail. On productivity, he was right to say that service sector productivity has been around 3 per cent. each year over the past five years. Therefore, if we interpret 2.5 per cent. efficiency gains as a 2.5 per cent. gain in productivity, we are in effect asking the whole public sector to make improvements in productivity similar to those that have been achieved over the past five years in the service sector.
  On administration costs, the answer that the hon. Gentleman and the right hon. and learned Member for Rushcliffe seek was published in the Budget. On a like-for-like basis, administration costs rose to more than 5 per cent. as a percentage of total expenditure under the Tories. They have been lower under Labour and are set to fall further to 3.7 per cent.—the lowest level since the running costs regime was introduced in 1986.
  On assets, we are building on the existing framework. If the hon. Gentleman consults the document published for the Budget, he will see the pattern of asset sales that we have been able to achieve since 1997 and why that gives us the basis on which to be confident in the long term about the £30 billion figure.
  I am glad that the hon. Member for East Carmarthen and Dinefwr found some warm words of welcome when he talked about the regional economic development public service agreement. He said that he did not disagree with every line in the spending review document, but I am disappointed that he reached page 178 before he found something that he could support.
  1514
  The right hon. and learned Member for Rushcliffe asked whether the economic and fiscal forecast would be met. The full answer, which was given by the Chancellor in the Budget, is that there was 2.3 per cent. growth last year, with 3 per cent. to 3.5 per cent. growth forecast for this year and next year. Tax receipts are on target, and fiscal rules are also on target, with a built-in margin against the golden rule, and net debt is projected to stabilise just below 36.5 per cent. of GDP, comfortably meeting the sustainable investment rule.
  As a result of today's debate and in the run-up to the general election, the British people have a choice. They can choose to have the services they need and the opportunities they deserve, with no one left behind. They will get that under a Labour Government with a vision of Britain that will succeed—
  It being Seven o'clock, the motion for the Adjournment lapsed, without Question put.

  BUSINESS OF THE HOUSE
  Ordered,
  That, at the sitting on Wednesday 21st July, notwithstanding the provisions of Standing Order No. 16 (Proceedings under an Act or on European Union documents), the Speaker shall put the Questions necessary to dispose of proceedings on the Motions in the name of Mr Secretary Prescott relating to Devolution not later than three hours after the commencement of proceedings on the first Motion; proceedings may continue after the moment of interruption; and the Orders of the House of 28th June 2001 and 6th November 2003 relating to deferred Divisions shall not apply.—[Ms Bridget Prentice.]

  SITTINGS OF THE HOUSE
  Motion made,
  That, at the sittings on Monday 19th, Tuesday 20th, Wednesday 21st and Thursday 22nd July, the Speaker shall not adjourn the House until any Message from the Lords has been received, until any Committee to draw up Reasons which has been appointed at that sitting has reported, and until he has reported the Royal Assent to any Act agreed upon by both Houses.—[Ms Bridget Prentice.]
  Hon. Members: Object.

  PETITION

    Benfleet High Road Post Office
    7 pm
    Bob Spink: Mr. Brian Keeler is a stalwart campaigner for his community and he has compiled a massive petition to save the Benfleet High road post office from closure. He is right to do that because our post offices are part of the fabric of our society, giving viability to fragile shopping parades and areas and offering much needed facilities to the elderly and to families, especially those who do not have cars. I am most grateful to him and to others, such as Elliott Ward, who signed the front sheet of the petition. Elliott may be from a younger generation than Brian Keeler, but his signature shows how the whole community, young and elderly alike, is prepared to come together because it cherishes and wants to keep open our post office network.

    1515
    The petition states:
    To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled.
    The Humble Peititon of Mr. Brian Keeler and others of like disposition sheweth
    That residents of Castle Point and particularly Benfleet are deeply concerned by the threat to their post office at 18A High road Benfleet and believe that the threat of closure of this post office damages the fabric of our community and closure would be severely detrimental to residents and to our shopping area.
    Wherefore your Petitioners pray that your Honourable House urge the Government to change its policies. on post office closures and on the payment of benefits and pensions and the provision of full banking services so that post offices are able to be more viable and retained.
    And your Petitioners, as in duty bound, will ever pray.
    To lie upon the Table.

  Military Aircraft (Northumberland)
  Motion made, and Question proposed, That this House do now adjourn.—[Derek Twigg.]
  7.2 pm
  Mr. A. J. Beith: I represent a constituency in which the RAF is greatly valued and respected. Indeed, we have been trying to persuade Ministers that they are making a serious and expensive mistake in planning to move most of RAF Boulmer's activities down to Lincolnshire. It is also an area in which a great deal of low-flying training takes place, and although most of my constituents accept that we have to take our share of the disturbance caused by low-flying fast jets, it gives rise to a fair amount of concern and correspondence. I would like the burden to be more fairly distributed and, if possible, reduced.
  Low-flying area 12, which covers Northumberland, is one of the most intensive areas in the country for low-flying. It surrounds Newcastle airport, which is an increasingly busy and successful airport for both scheduled and charter flights. That is a potentially a lethal mix. A bulletin from the air accidents investigation branch in May on the dangers that have arisen makes chilling reading, and refers to the potential for large-scale loss of life if new procedures are not put in place to eliminate near misses and collisions over the north-east of Britain.
  I shall revert to the AAIB bulletin later. I am seeking, through the debate, to get absolutely clear answers and assurances that the safety recommendations made in it have been fully implemented. First, I want to consider the recent history of accidents and near misses and the measures taken, unsuccessfully, to try to prevent further incidents. I shall refer to only some of the incidents that have occurred.
  In December 1998, a low-flying RAF Harrier came within 100 ft of a civilian helicopter over Northumberland. In July 1999, a Harrier crashed in my constituency while avoiding collision with another military aircraft on an unconnected navigation exercise flight. In October 1999, an RAF Tornado crashed in Northumberland with the loss of two crew. Minutes earlier, it had been in an air proximity incident with a Boeing 737 flying out of Newcastle airport. In March 2000, there was a near miss involving an RAF Tornado and a passenger aircraft near Alnwick. The passenger aircraft was a Shorts 360 with 11 passengers inbound to Newcastle from Aberdeen. Newcastle air traffic controllers had warned the civil aircraft of the danger posed by unidentified, fast-moving military traffic. However, they had no means of warning the RAF pilots, who communicate on separate radio frequencies. On the advice of the controllers, the civil aircraft had changed course to avoid possible conflict with the Tornado, but a subsequent change of course by the military aircraft brought them back into conflict.
  Following that incident, I tabled a parliamentary question, which led the then Transport Minister, the hon. Member for Coventry, North-East (Mr. Ainsworth), to reply that
  "the CAA is working closely with airspace users and Newcastle Airport, as a matter of urgency, on a whole range of initiatives aimed at preventing such conflicts in the future."—[Official Report, 25 April 2001; Vol. 367, c. 274W.]

  1517
  Those measures did not, however, prevent a further potential conflict involving a Boeing 737 and a military jet in February 2001, or an incident in July 2001 in which a military jet came within 500 ft of a passenger plane heading into Newcastle from Oslo.
  In April 2002, I tabled further questions and received a reply from the junior Defence Minister referring to further measures. These included the fitting of secondary transponders to military aircraft on exercise and arrangements for major exercises, including a temporary buffer zone and the presence of a military liaison officer in Newcastle air traffic control. Those arrangements were put in place only during major exercises. The Ministry of Defence and the Civil Aviation Authority were, however, satisfied that there was no need to change the airspace arrangements around Newcastle. Within days of that parliamentary answer, a Dash aircraft leaving Newcastle for Norway with 16 passengers on board was the subject of a practice interception by two Sea Harriers. They did not realise their mistake until they came within visual range and passed within 3,450 ft, with only 100 ft of height separation.
  Less than three months later, a civil transport plane heading into Newcastle came within 100 ft of an RAF Jaguar. The Avro crew heard a jet engine noise and the flight officer in the right-hand seat saw the Jaguar "in a flash", passing underneath while in a steep climb. The investigating board described this as
  "one of the most serious Airproxes"
  it had seen. RAF Strike Command said that "a robust directive" had been sent to all fast-jet pilots to ensure that a similar occurrence could not happen again, and that a draft amendment to military flying regulations had been raised.
  Unfortunately, that was not the end of the story. Two incidents in June 2003 involved aircraft flying from Teesside to Amsterdam and Aberdeen. On 1 October 2003, there was an alleged infringement of Newcastle controlled airspace by a military aircraft west of Newcastle, which necessitated avoiding action by an Airbus 319. In February this year, there was a very serious incident involving a helicopter and a Tornado in class G airspace in the Aberdeen area. The crew of the helicopter
  "suddenly became aware of a roaring noise"
  and severe turbulence. The commander grabbed the controls and looked across the cockpit to the left in time to see the co-pilot's windscreen and quarter light filled with what he believed to be the rear section of a Tornado aircraft in a steeply banked turn at a range of 50 ft.
  In May 2004, the air accidents investigation branch, in bulletin 5/2004, drew together these most recent incidents with others, and reached some very worrying conclusions. I shall quote from this analysis, which refers to
  "the potential risks involved when CAT aircraft"—
  that is, civil aircraft—
  "and military aircraft operate concurrently in the same unregulated airspace, especially when the controller has no communication or control over the manoeuvres of the military traffic and when providing a minimal radar service, ie, a RIS. In the general area where this incident occurred, there is a high level
  1518
  of military activity and limited lower altitude … controlled airspace for CAT aircraft operating between the regional airports in the north-east of the UK and northern Europe. Whilst there are military regulations in place designed to avoid Airprox events"—
  such as the one in April 2002—
  "this incident highlights the difficulty of always ensuring compliance with such regulations. The obvious possible solutions are to require military traffic to operate under a radar service, to deny CAT aircraft access to areas of known military activity or to increase the regulated airspace. Either of the first two options, while providing a high level of safety, would be restrictive to both types of operation. An increase in the provision of regulated airspace from regional airports in the north-east of England would seem to offer the optimum solution for the safety of CAT aircraft, but this would be at the expense of the available airspace in one of the few large scale training areas in which military aircraft operate in the UK."
  We know that that last concern has led to the MOD resisting the expansion of controlled airspace or protected zones in the past.
  The AAIB went on to say, referring to north-east Britain, including both Northumberland and the Aberdeen area:
  "CAT/military Airproxes continue to occur in this area despite the procedures, monitoring and airspace changes that have been put in place in an attempt to prevent such incidents. The fact that collisions did not result from the circumstances of two extremely serious events of July 2002 and February 2004, with what would have been an inevitable loss of life, was extremely fortuitous."
  I come now to the specific recommendations, and I want to hear the Ministry of Defence's response to each of them. First, safety recommendation 2002–55 states:
  "The Civil Aviation authority should re-examine the airspace categorisation, procedures and services currently available to Civil Air Transport aircraft which operate through unregulated airspace associated with regional airports in the north-east of the UK, with the aim of ensuring that a level of protection is afforded to such aircraft from military aircraft such that airprox events are avoided. The impact of any potential changes to the available unregulated airspace used by military aircraft should be minimised as far as possible".
  What has been the result of that re-examination, and what has the MOD done to provide that protection?
  Secondly, safety recommendation 2003–53 states:
  "The Ministry of Defence should review the operation of military aircraft in the unregulated airspace around the north-east of the UK, including the conduct of practice interceptions of targets, to ensure that procedures in use and the equipment fitted to military aircraft assure adequate separation of military aircraft from Civil Air Transport aircraft which operates concurrently through unregulated airspace in the region."
  What changes have been made to procedures? Are all military aircraft fitted with the necessary equipment if they operate in those areas?
  Thirdly, safety recommendation 2004–21 states:
  "The concurrent use of unregulated airspace by both CAT and military aircraft in the north-east of the UK, should be reviewed jointly at the highest level by the CAA and MoD with the aim of eliminating Airproxes and potential collisions, with likely large scale loss of life"—
  those are the words of the AAIB—
  "between Civil Air Transport and military aircraft."
  What has been the result of that review, and what changes have been made in MOD practice as a consequence?
  Those are the key questions to which I want to hear answers tonight. Those were the recommendations of a highly responsible and expert body, which reflect

  1519
  detailed analysis of a long series of alarming incidents and of the failure of previous measures to prevent further incidents. They are expressed in unusually strong and dramatic language for a report of this sort.
  Finally, the time has come for a wider review of low-flying training, the need for it, the amount that is required, the areas over which it is carried out, and the ways in which it is monitored. It is increasingly common for those who complain to me about the extent of low flying over Northumberland to include people who have recently retired from the RAF and other armed services. When they write to me, they often ask whether there is as great a need for low flying by fast jets as there used to be, and they draw attention to the fact that it is a skill that has not been used much, if at all, in recent conflicts.
  Surely it is time that the case for this large-scale training investment was tested. If the case remains sufficiently strong, a review should consider how its impact on the areas where it is most intensively carried out can be lessened. If such a review is initiated, as I believe that it should be, it may lead to reductions, which will reduce the risk of dangerous interaction with civilian aircraft. That risk exists now, however, and the measures demanded by the AAIB in its bulletin of May this year need to be acted on urgently. They cannot wait for a wider review of low flying, even if the Government agree to one.
  The travelling public, the people of the areas over which collisions can take place, such as Northumberland, and the civilian and military aircrew on whose skills we depend, are all entitled to have those questions answered.
  7.14 pm
  The Parliamentary Under-Secretary of State for Defence (Mr. Ivor Caplin):I congratulate the right hon. Member for Berwick-upon-Tweed (Mr. Beith) on becoming a grandfather for the first time. I hope that mother, baby and grandparents are doing well. I also thank the right hon. Gentleman for providing the opportunity for a debate that I consider very important and pertinent.
  I can assure the House that in military aviation matters, safety is paramount. I therefore welcome the opportunity to address the points raised, and I hope I can add some balance to the rather alarming picture that the right hon. Gentleman painted. I welcome his support for the Royal Air Force, of which he has been a consistent supporter in the House, but I am afraid he will have to wait a little longer to hear of any decisions that might affect RAF Boulmer.
  Our obligation to those on the ground, as well as to our aircrew, ensures that we remain very aware of the risks of military flying, and flight safety remains the Ministry's highest priority. We strive to reduce any risks to the absolute minimum, and there are stringent regulations to safeguard both the general public and our own aircrew.
  I acknowledge recent concerns that have been expressed about flight safety over the north-east, largely arising from the air accidents investigation branch report that was published in May, and to which the right hon. Gentleman referred. The report conflated a number of incidents that have occurred during the last three years or so. The Ministry of Defence actively
  1520
  participates in the United Kingdom Airprox Board, and carefully considers all its recommendations. However, we must recognise that the area has seen significant growth in commercial aviation using Northumbrian airspace, both gaining access to Newcastle and other regional airports and in transit between the north and the south of the country. That has inevitably increased airspace congestion, and problems are likely to be exacerbated by the increasing use of uncontrolled airspace by commercial aviation. The diverse nature of operations within uncontrolled airspace means that the concept of eliminating all airproxes, while a laudable aim, is unrealistic in practice.
  The Ministry of Defence meets the Civil Aviation Authority regularly, at senior levels, to discuss the use of uncontrolled airspace, with particular emphasis on areas in the north-east of the United Kingdom. The major focus of every meeting is the maintenance or enhancement of safety standards, and ensuring that airspace is available for use by both military and civilian operators, with procedures to enable everyone to use the airspace safely.
  The right hon. Gentleman asked what measures the Ministry of Defence was taking in response to a number of safety recommendations that he cited. Let me give some examples. In response to safety recommendation 2002–55, measures were introduced in March last year to increase the controlled airspace between Manchester and Newcastle airports. Further adjustments to the controlled airspace around Newcastle were also made, which has given additional protection to civil aviation. More enhancements are anticipated as a result, and we believe that that will ultimately increase the safety of commercial aircraft in the Newcastle area.
  The right hon. Gentleman also mentioned safety recommendation 2004–21. The Civil Aviation Authority has initiated a review of overall airspace arrangements in the north-east. I can confirm that the Ministry of Defence will be fully involved in the work, and that the first meeting will be held next month. This will build on the work already accomplished in concert with our partners.
  The Ministry of Defence reviewed procedures immediately after the issue of the safety recommendation, which it partly accepts. I can say that the operation of military aircraft in uncontrolled airspace is kept under constant review in conjunction with the Civil Aviation Authority; but the right hon. Gentleman will recall that the UK Airprox Board assessed the incident to which he referred as one in which
  "no risk of collision existed".
  Mr. Beith: Can the Minister clarify why the Ministry of Defence only "partly" accepts that important safety recommendation?
  Mr. Caplin: We are still examining the issues with the CAA, which is why I used the word "partly". I undertake to keep the right hon. Gentleman up to date with progress made on the safety recommendations following this evening's debate.
  I can assure the House that all aspects of flight safety are kept under continuous review, and that there are many ongoing initiatives. For example, we have made

  1521
  the use of a transponder mandatory at low level for all our aircraft; that will make them visible to the collision warning systems that are fitted to airliners and to many helicopters. The use of transponders will also improve the ability of air traffic control radars to see our aircraft, and a programme to make our aircraft more visually conspicuous to others is virtually complete. All RAF aircraft operating at low level are now fitted with highintensity strobe lights, and all Hawk aircraft are fitted with forward-facing, high-power lamp assemblies. The high visibility black and yellow paint scheme used on our training aircraft has proved extremely effective, and we are conducting trials to improve further the visibility of helicopters through the use of coloured rotor blades.
  We continue to pursue technical solutions to improving safety at low level. Although the technology used in the collision warning systems fitted to commercial airliners has not proved suitable for use in highly manoeuvrable fast jets, we are investing in a programme to develop and fit a collision warning system to the Tornado. Where commercial collision warning systems have proved suitable, as with the Hercules C130J, they have been fitted. We have also carried out a very successful trial of a commercial system with the Tucano training aircraft.
  More generally, through the ShAirspace initiative the MOD and the United Kingdom Flight Safety Committee have developed a regional forum for discussion between the military aviation community and civilian operators such as airports, airlines and flying schools. These forums have been highly successful, giving aviation users an opportunity to exchange ideas and views, as participants of the forum held in Durham last October will doubtless agree. They will continue; indeed, my officials will arrange for the next forum to be held shortly.
  The MOD of course maintains excellent relations with the management of Newcastle airport, who, along with the CAA, meet MOD officials formally every six months. The right hon. Gentleman will be interested to learn that today, a military liaison officer briefed the airport's air traffic controllers about the details of a military exercise that occurred earlier today. It has become standard practice for the MOD to provide a liaison officer for any large air exercise that occurs in the north-east.
  We also seek to engage with local authorities that raise concerns about low-flying military aircraft. A joint presentation by the airport and the MOD to an inter-authority low flying working group last year was very successful, and it forms a basis for future co-operation. A further inter-authority working group event is being organised for the autumn, and the MOD is committed to supporting this initiative.
  Our armed forces are highly valued and respected around the world for their professionalism and skill. We as a nation continue to expect them to be ready to defend our interests, and those of our allies, anywhere in an unstable, unpredictable world, and often at short notice. They have distinguished themselves time and again, and they are able to do so because they are highly trained. The House will doubtless agree that such levels
  1522
  of proficiency are not reached overnight: they are the culmination of years of training, and military aircrew, like all other elements of the armed forces, need to train.
  One aspect of aircrew training is the ability to fly aircraft at low level, which is acknowledged as being a demanding but essential skill. I accept that, as the right hon. Gentleman said, such flying is not always required for military operations, but military commanders must be confident that if they need to deploy aircraft at low level, they can do so.
  Low flying remains a vital element in our armoury of tactics. Flying low and at speed, aircrew use the contours of the earth to screen themselves from sophisticated radar systems, fighter aircraft, missiles and anti-aircraft artillery. But low flying is a skill that may also be used extensively in humanitarian relief operations and by helicopters undertaking search and rescue tasks. Whatever the task, aircrew must train to be able to carry it out.
  I have said that low flying is a specialised skill: it is also a perishable skill and requires regular practice. It cannot be learned in an emergency, so rigorous training in a realistic environment is essential. Let me reassure the right hon. Gentleman that maximum use is now made of simulators, but they can only complement the reality of low flying—although we do, of course, continue to monitor carefully modern advances in simulator technology to assess the scope for their future use.
  The United Kingdom low-flying system comprises the open airspace of the whole of the UK and the surrounding over-sea areas from the surface up to 2,000 ft above ground level. Helicopters are generally permitted to operate to 100 ft, but may be authorised to operate to ground level for certain tasks and 250 ft is the lower limit for fixed-wing aircraft undertaking routine low-flying training—although they may fly much lower during operations. Training above 500 ft is of little value because, as height increases, the training value for this vital skill degrades rapidly.
  In addition to the routine low-level flying, a very small amount of fixed-wing low flying down to 100 ft is permitted in three specially designated tactical training areas situated in the borders, northern Scotland and central Wales. The borders tactical training area, low flying area 20 Tango. includes part of the right hon. Gentleman's constituency. The amount of that activity, called operational low flying, is limited to that which is absolutely necessary and is spread across three special areas proportionate to their size. It represents less than 2 per cent. of all low-flying training.
  Mr. Beith: I should like to point out briefly that one of our worries is that the main incidents have not been in the special areas, the 50 ft areas or, indeed, during the major military exercises when special measures are laid on. It is in the general run of low flying that the problems have arisen.
  Mr. Caplin: I understand what the right hon. Gentleman is saying, but he made a number of comments about the overall pattern of low flying and I am trying to put the whole thing into context in response to what he said.
  The undulating terrain of the north-east of England, largely an area referred to as low flying area 12, which also includes part of the right hon. Gentleman's

  1523
  constituency, offers valuable training, as it contains some of the most challenging terrain for aircrew. In addition, a number of training facilities are situated within and close to Northumberland. Aircraft from the many airbases situated on the east side of the country—or, indeed, some NATO allies—fly over the north-east or transit through to low-flying areas in Scotland. That is necessary because of the built-up areas and controlled airspace in the midlands, Yorkshire and other parts of the north-east over which they cannot fly. They must also avoid conflicting with other military activity at Leeming, Linton-on-Ouse, Dishforth and Topcliffe.
  We understand that military low-flying training can be intrusive to people on the ground, perhaps particularly in those rural, less densely populated areas that experience more low flying than their urban neighbours. We implement various measures to minimise disturbance as far as practicable. Accordingly, the amount of low flying that does take place is limited to that which is strictly necessary for aircrew to achieve and maintain operational effectiveness. Let me reassure the House that we continually assess our requirement for such training.
  In support of our aim to achieve a better balance between the need to train in the air and respect the sensitivities of those on the ground, most fast-jet low flying takes place during the daylight hours of weekdays. Public holidays are avoided, as are weekends as far as possible, although some activity may be permitted, mainly in support of reserve forces that are unavailable for training during the week. Night low flying is required to be completed as soon as possible in the evenings and it is rare for jet aircraft to be permitted to operate after 11 pm.
  I am determined that we will continue to be aware of, and sensitive to, the needs of the public. Any issue that is raised with me, or direct with my officials, is taken very seriously indeed. Individual RAF stations are at pains to explain their activities to their local communities, and
  1524
  they have community relations officers on their staff available to talk to members of the public. In addition, three regional community relations officers serve the communities remote from air stations in Wales, southern Scotland, and Cumbria and Tynedale. They are the focal point for military low flying issues in their respective areas, and members of the public in those areas may direct any matter, inquiry or complaint to them.
  Next week, I intend to make a written statement to the House presenting the figures to be published in the annual statement on the pattern of military low flying. I hope that the details will go some way to assuaging the anxieties of the right hon. Gentleman, in that the amount of low flying generally continues to decrease. I will ensure that he gets a copy of the statement.
  The Ministry of Defence is not complacent when it comes to safety. It is of paramount importance to us. I hope that I have reassured the right hon. Gentleman that we have measures in place to reduce risk, and that we are actively engaging with others to implement further measures.
  The maintenance of the skill of low flying is an essential military requirement. We manage low flying training so as to ensure the safety of those in the air and on the ground, and to take account of the sensitivities of those living in rural areas. We will never attain the ideal of distributing all low flying training across the UK on a totally equitable basis, but we aim to learn by events and to take account of lessons learned in our planning for the future.
  In conclusion, I hope that today's debate reassures the right hon. Gentleman, his constituents and the House about the action that we are taking on this very important issue.
  Question put and agreed to.
  Adjourned accordingly at twenty-nine minutes to Eight o'clock.

Preamble
[MR. JOHN MCWILLIAM in the Chair]

Construction Industry (Deaths)
Motion made, and Question proposed, That the sitting be now adjourned.—[Margaret Moran.]
9.30 am
Mr. Deputy Speaker: May I caution Members that, although the first debate is on deaths in the construction industry, they must not refer to any case that is still before the courts or unresolved and that is therefore sub judice?
Jim Sheridan: I am extremely grateful but somewhat sad that the issue of deaths in the construction industry has been chosen for debate today. By the time we have finished this debate, there is every possibility that a construction worker will have either lost their life or been severely injured through no fault of their own. Having spent many of my working days in the industry, I am well aware of the dangers and risks associated with it.
There are, on average, 80 deaths a year on building sites, and significantly more serious accidents. Although there are official figures for recorded accidents on Britain's building sites, there are serious concerns that many accidents go unrecorded, for reasons ranging from employer intimidation to workers operating in the twilight world of illegal working.
Organisations such as the independent trades unions are already expressing genuine concerns about the fact that the problem could be further exacerbated by much-needed qualified migrant construct ion workers moving into the industry. Such workers may currently have little or no training in health and safety, and many of them cannot read or understand the English language.
Anne Picking: I congratulate my hon. Friend on raising this serious issue, and I look forward to hearing the debate. On twilight organisations and unscrupulous employers, does he share my concern that many take up work in the construction industry with bogus rogue employers who do not have the proper health and safety procedures and insurance? The firm could have a fatality or serious injury, and there would be no recompense for the workers concerned or their families.
Jim Sheridan: My hon. Friend is absolutely right. Unfortunately, some people still operate illegally in the construction industry. Workers are engaged by such people and they have no recourse to compensation should they suffer injuries during their employment with those conmen. I congratulate my hon. Friend on raising that issue. She has vast experience of working in the health service, and has seen at first hand some of the horrific injuries that have come through the hospitals.
I spoke about migrant workers coming into the construction industry, but I qualify that statement by saying clearly that migrant workers and indigenous
428WH
workers are entitled to the same health and safety standards as anyone else. It is true that the construction industry, in particular, is suffering from severe skills shortages across the length and breadth of Britain. It is important that we bring in migrant workers, but we should do so on the understanding that they work under the same conditions as everyone else in Britain.
There is no doubt whatever in my mind that the increase in fatalities in the construction industry is consistent with the decline in trade union representation on our building sites. Unfortunately—and my hon. Friend the Member for East Lothian (Anne Picking) alluded to this—some unscrupulous employers are still happy to play fast and loose with people's lives. I will return to that point later.
Trade unions invest large amounts of their limited resources in training safety reps to recognise and report potentially dangerous practices. Perhaps that is why the cowboy operators, as we call them, seek to undermine the trade unions at times and obstruct their activities. I am sure that many colleagues here will have constituents working in the construction industry, which is often undervalued. None the less, it makes an enormous contribution to our everyday lives and the country's economy.
John Robertson: I congratulate my hon. Friend on introducing the debate. Putting the cowboy companies to one side, does he agree that even the best companies have problems with health and safety? That is not always on the side of the management. When the management express an opinion on the rules governing health and safety, it is sometimes perceived to be interfering. Does he agree that we need education not only for the management, but for the workers so that they become their own safety officers?
Jim Sheridan: My hon. Friend makes a valid and honest point. I am not suggesting for a minute that all employers in the construction industry are rogue or cowboy operators. There are a fair number of legitimate, good and honest employers in the construction industry and they are calling for a level playing field for health and safety. I agree that the workers have a responsibility on their own shoulders to make sure that they are working in a healthy and safe environment. If they identify a reason why they are not experiencing such conditions, they have a responsibility to say so. Facilities are already in place for whistleblowing and so on.
I have referred to trade unions, but those who work in a dangerous environment deserve our attention and our support. Thankfully, similar fatalities do not happen in other sectors of our society but, if we had the same number of deaths in our police forces, our fire services or, dare I say it, in our armed forces, we and the press and media would demand action and call for heads to roll. Why then do we not make similar demands on employers who knowingly put their employees at risk?
A 20 per cent. rise in the number of deaths on building sites must be taken seriously by us all. If not, the trend will continue. Last year, 86 construction workers were killed with employers being punished—if that is the right word—by having to pay ridiculous fines ranging

429WH
from £300 to £600. What is the point of our clamping down on culpable employers and pushing for more prosecutions only to be undermined in the courts? We need to find ways in which to join up the authorities that are charged with prevention and punishment or there will continue to be an increase in the number of fatal accidents in the construction industry.
Mr. John Randall: Are the fines set the maximum allowed or are they what the courts are imposing?
Jim Sheridan: The maximum fine can be more than £600, but those who impose the fine might not have a clear understanding of how dangerous the industry is. Therein might lie the problem. If they had a flavour of what some workers are going through in the construction industry, they might want to consider seriously how to deal with rogue employers.
In February 2001, the Government called a construction summit entitled "Turning concern into action" because of their awareness and growing concern about the industry's poor health and safety record. The conference acknowledged the concern about the industry's performance, agreed that it had to improve and committed the industry to a step change in performance. That was demonstrated by challenging targets and action plans.
The Minister then responsible for health and safety summed up the main day of the conference by concluding that
"we need a culture change—one where the industry sees itself as high quality, high performing and highly trained. The status quo is not acceptable—we must strive for the highest standards.
The Government, as a major client, has a vital role to play. The Office of Government Commerce guidance is a welcome step in setting those standards and lending more weight to health and safety performance."
The Minister continued:
"An industry which values and respects its workforce and takes responsibility for encouraging the health and safety and well being of its employees it likely to be a successful industry. We owe our workforce the right to be able to do a good day's work safely, go home to their families and not be one more casualty in an industry where there has been far too many in the past."
That step change in performance has not been achieved; those challenging targets have not been met; and the action plans are not delivering. This Government have done many good things in their period in office. However, despite giving a commitment that is now seven years outstanding, they have so far refused to set a date for a Bill that will make corporate killing an offence. With such blatant injustice, we must ask what the Government are afraid of.
I will conclude, as I am conscious that several other colleagues want to speak. The Health and Safety Executive is trying hard to address this issue along with good employers and the trade unions, but they require the proper tools to do the job effectively. That is why we, as legislators, must take seriously our responsibilities and introduce effective and robust legislation that will concentrate the minds of employers on the fact that life is precious and should be treated as such. As the law
430WH
stands, the paltry fines imposed on guilty employers are an insult to those who have died and to workers and their families.
9.42 am
Mr. Michael Clapham: First, I offer my congratulations to my hon. Friend the Member for West Renfrewshire (Jim Sheridan). I also draw Members' attention to my interests, as I chair the group of MPs who are concerned with the Union of Construction, Allied Trades and Technicians, which is the largest trade union operating in the construction industry.
I shall make three points, and I want to draw the Minister's attention to what I perceive to be required in the construction industry: partnerships, which should work in conjunction with enforcement. There is a need to bring together on the major sites trade unions and their solicitor, employers and their solicitors, and the British insurance industry. If we can do that, there is the possibility of ensuring that the major contractor has a health and safety policy approved by the Health and Safety Executive, which becomes embedded in the contracts of all the other subcontractors. The one thing that is difficult to come to terms with in construction is the fragmentation caused by subcontracting. If the major contractor agreed to a health and safety and training policy, which was included in the contracts of all the subcontractors, there would be a chance of getting on top of some difficulties that we face.
One difficulty that my that my hon. Friend referred to is the safety culture. Because of fragmentation, there is little meaningful safety culture in construction.
John Robertson: Does my hon. Friend agree that one priority should be to beef up the Health and Safety Executive, in particular to have spot checks and field operatives checking on building sites without notification?
Mr. Clapham: My hon. Friend makes a good point and I will refer to it later.
First, we could set up a partnership approach and encourage subcontractors to take it up, and we could encourage the British insurance industry to make discounts available in employment insurance premiums in return for accepting the health and safety policy of the major contractor and agreeing to training. That is not to say that there should not be enforcement. I believe that there is a need to increase the penalties and I hope that my right hon. Friend the Minister will consider whether she needs to introduce legislation that would embrace corporate manslaughter. That would be an important inducement to ensure that employers comply with their legislative requirements.
There could be a partnership approach along with enforcement and checks by the HSE, to which my hon. Friend the Member for Glasgow, Anniesland (John Robertson) referred. It is important that the HSE is properly financed so that it can ensure that it has the adequate number of field inspectors to carry out regular inspections and to turn up unannounced on building sites.
There also needs to be workers' safety representatives who are well trained and who could take on the role of roving safety representatives. I know that there have

431WH
been a number of pilots in the construction industry; perhaps the Minister will refer to those. I understand that there have been successful pilots using roving safety representatives. She could consider rolling those out across the industry, because there is a need to come to terms with the poor record on deaths and injuries in construction and we must make a concerted effort to reduce the number of deaths, which my hon. Friend the Member for West Renfrewshire identified as 86 in the past year. Using partnerships, enforcement and roving safety representatives could be a way of getting on top of the situation in the construction industry and also of helping to rebuild a safety culture in it.
My second point relates to false self-employment. It is rife in the industry, which is the only one in which people who are self-employed have their tax deducted at source. I recall that UCATT, which is the major union in the industry, had a report prepared on false self-employment two or three years ago. It showed that the practice was rife across the industry. It was suggested that the Exchequer was missing out to the tune of £1.5 billion a year because of false self-employment.
Following that report, there was a series of meetings with the Treasury and it is considering—or it was—revising the process of how people register as self-employed. I understand that during the past year there was a pilot on that aspect. I also understand that it may be rolled out across the industry if it proves to be successful. If that is the case, we may be able to get on top of false self-employment, which helps to fragment the industry and undermines the safety culture.
Mr. Ian Davidson: Does my hon. Friend agree that this is not just a question of the Treasury losing money as a result of false self-employment? The Treasury encourages false self-employment by providing financial incentives not only to those who become self-employed but to the potential employer, who has a disincentive to take people on directly. Clearly, the Treasury drive for flexible labour markets costs lives.
Mr. Clapham: I agree entirely. We need to be able to check false self-employment so that we can come to an arrangement on how people are employed. People employed on a pay-as-you-earn scheme tend to be more given to following the regulations set by their employers, but a self-employed person will tend to ignore the procedures set down by the contractors he is working for.
It is also important to recognise that in construction there are genuinely self-employed people, and there will always be a need for them, but the position is that false self-employment is undermining the union's attempt to embed a safety culture that would help to tackle the problem of accidents and injuries. It is important that we come to terms with false self-employment so that we can control it and stop it fragmenting attempts by the unions and employers to embed a safety culture.
My third point is about asbestos, to which many construction workers are exposed. I note from the recently published summer edition of the British Asbestos Newsletter that construction was the industrial sector with the highest incidence of diagnosed mesothelioma cancer between 2001 and 2002. During that period, there
432WH
were almost 1,900 new diagnoses of that particularly virulent cancer. A person diagnosed with it has a short life expectancy—possibly 18 months.
The TUC reckons that, in addition to the recorded mesothelioma cancers, twice as many different cancers are caused by exposure to asbestos, so, overall, there are probably 4,000 cancer diagnoses across the country each year as a result of exposure to asbestos. On 16 May, The Sunday Times magazine published a thorough article by the investigative journalist Peter Martin, which drew attention to the growing problem of asbestos. He suggested that over the next 46 years there are likely to be more than 180,000 deaths in the UK resulting from exposure to asbestos.
I am aware that the new control of asbestos at work regulations were introduced earlier this year, and they are a step forward, but they do not apply to residential premises, even though many construction workers who come into contact with asbestos do so in residential premises. I can tell the Minister that during the health and safety debate at this year's UCATT conference, it was made clear that the union will call for an extension of the asbestos at work regulations. It wants that extension to embrace the residential sector, in which many of its members work.
Asbestos is a real problem, and I hope that I can persuade the Minister to support the call for a health and care strategy for people suffering from asbestos-related diseases. Australia has already implemented a health and care strategy. It has made a great deal of resources available to deal with the victims of exposure to asbestos, and I think that this country needs to do the same. I am aware that the NHS has a number of pilot schemes running, but we need to move pretty speedily when there are 4,000 diagnoses each year of cancers caused by exposure to asbestos. That is in addition to the men and women who will be diagnosed as suffering from asbestosis.
I hope that the Minister will take on board those three points and consider how we can move forward to building a meaningful safety culture in construction, because that is how we will get on top of the high rate of deaths and injuries each year.
Several hon. Members rose—
Mr. Deputy Speaker: Order. I remind hon. Members that the purpose of the debate is to enable the Minister to answer the hon. Gentleman who initiated it. However, if all contributions are short, all those who want to will be able to speak.
9.56 am
Mr. John Lyons: I will try to be brief. Like others, I welcome the debate and congratulate my hon. Friend the Member for West Renfrewshire (Jim Sheridan) on securing it. There is no doubt that the construction industry is of national importance to the British economy. Nevertheless, the statistics for the industry hide the personal tragedy for the people who are killed and injured and the effect that that has on their families. That applies all over the UK. The debate has given, and will give, recognition to the very good work and practice of employers, individual trade unions, the Health and Safety Executive and, in

433WH
particular, the TUC and the STUC. Both those organisations have had a keen interest in the construction industry.
You will have noticed, Mr. Deputy Speaker, that a number of Scottish MPs are attending the debate, and with good reason, because the statistics for Scotland are horrendous. Indeed, they are worse than those for the rest of the United Kingdom. I will give an example. In manufacturing in 2002–03, four people were killed in Scotland and 41 in the UK. In the main industries, therefore, Scotland's rate of injuries and deaths is about a tenth of the UK's, but that is not the case in construction. In construction in 2002–03, there were 11 fatalities in Scotland; there were 56 in the UK. The rate of deaths is running at almost 10 per cent. higher in the Scottish construction industry than in the rest of the UK. Clearly, there is something wrong in the building industry in Scotland and much more work needs to be done in that regard.
I recognise that things are happening. There has been a blitz of inspections of building sites, including across whole cities, to try to get on top of the problem. I, for one, would welcome that practice being relaunched by the HSE, because it is an effective way of working. Following one such visit, the HSE's head of operations for construction, Pam Waldron, said:
"The clear message is that the industry must tackle those things which are killing and injuring people, and making them ill at work. Sadly the blitz indicates that there is a common pattern across construction sites in Great Britain of relaxed attitudes to health, safety and welfare.
As in the London blitz last month, we found standards on many of the sites to be well below what we expect. I personally witnessed many examples of poor site management and lack of control of subcontractors allowing unsafe working practices. I also saw individual workers putting themselves at risk by ignoring site rules and taking shortcuts. But there were also examples of well run sites, where health and safety risks were properly controlled. We need to see much more of this."
The figures make interesting reading. Prohibition notices were served on 226 of the 440 sites that were visited. That is another clear indication of the type of problem facing the industry. The figures across the UK are horrific.
There is good reason to be optimistic in some ways. Last year 2,000 young people were brought into the industry to go through a modern apprenticeship based at a college and the workplace or the site itself. We need to ensure that we step up the work of the HSE and the trainers in this area. People can receive good and fundamental health and safety training that, I hope, will never leave them. We need to keep the issue to the fore; it always will be if my hon. Friend the Member for West Renfrewshire is in the House.
10.1 am
Mr. Bill Tynan: I offer my congratulations to my hon. Friend the Member for West Renfrewshire (Jim Sheridan) on securing this debate and on his Gangmasters (Licensing) Act 2004, which he successfully piloted through the House. A comparison can be made, because the same cavalier and uncaring attitude of some employers is found in the construction industry.
434WH
Many hon. Members have spoken about the numbers of people who have been injured. It is worth repeating that workers in the construction make up 6 per cent. of the work force, but account for a third of all fatal accidents and 16 per cent. of reported accidents. Construction workers are nearly five times more likely to be killed than workers in any other industry. There were 71 deaths in the construction industry in 2002–03 out of a total in an industries of 226. Alan Ritchie, UCATT's regional secretary for Scotland, said in June:
"The problem is that the best way to murder somebody in Scotland is to employ them in the construction industry."
The provision for the cost of accidents and near misses on a typical building site can amount to 8.5 per cent. of the contract price. The construction industry has a total annual output of £84 billion, so £7 million is built into contract prices to account for accidents and injuries. That is a horrific figure. The targets set at a health and safety summit in 2001 between industry and Government of reducing deaths and major injuries by 40 per cent. by 2005 and 66 per cent. by 2010 are unlikely to be met. I ask the Minister to look seriously at that. If we are setting targets at that level, we should see how best we can ensure that they are met. They have to be realistic.
In a report published in May, the National Audit Office looked at the HSE and the role the Government can play in improving safety in the construction industry. It was critical of the culture of the industry and explored a number of avenues for further Government action. It believes that the high level of death and injury is caused by the culture of some in the industry. I echo the point made by my hon. Friend the Member for Strathkelvin and Bearsden (Mr. Lyons). There are some good employers in the construction industry, but we have to deal with the bad ones. We also have to deal with the employees who put their own safety at risk and ensure that they have the sense and are trained to prevent the accidents that occur on construction sites.
The deskilling of workers is a major problem. The point has been made about the need for apprenticeships in the construction industry. I am heartened that the industry has taken that on board and is looking for ways to re-skill the work force because many people on construction sites do not have the necessary skills or the proper attitude towards health and safety.
Another problem is the fragmented nature and the large size of the industry. The HSE has done much through education and enforcement action to encourage employees to become involved with health and safety. Employers have talked about cowboy practices among employees that need to be removed by training.
The sanctions that apply against companies that break the law are part of the culture problem. Custodial sentences have been given to those guilty of animal mistreatment, and we have even talked about a naked rambler who was wandering from London to the top of Scotland and was put in jail. People are also threatened with jail for non-payment of council taxes. Yet, no one in the construction industry responsible for accidents has been given a jail sentence. The draft animal welfare Bill will set in place a maximum fine of £28,000 for people found guilty of animal mistreatment. We must get our priorities right; I support those measures for animal welfare, but we should also consider people in the construction industry.

435WH
Over the past 30 years, there have been 3,500 deaths in the construction industry yet no employer has faced prison. Large fines have been issued—£250,000 to £500,000 in recent cases—but there is no clear link between the seriousness of the offence and the ability to pay. If someone has the ability to pay, they should do so. A number of labourers have been fined £500 for unsafe actions, while companies are fined only £5,000 for hiring out defective equipment that has caused death. That dramatically highlights the attitude of some courts in this country, and we must overcome it.
There has been a progressive deskilling in the construction industry. A UCATT survey found that only 10 per cent. of workers had appropriate formal qualifications. The same survey found that 25 per cent. of workers had problems with basic reading, writing and numeracy. It is incredible that we are employing people in the construction industry with those problems. The increasing casualisation of the industry, both through the rise of self-employment—real and bogus—and through the rise of subcontracting has undermined industry-wide initiatives such as national vocational qualifications and minimum safety standards.
The fragmentation of the industry has direct consequences. There are 2 million employees across 168,000 companies. That causes problems for the HSE, but it has tried to tackle them seriously. Its blitzes have been effective. It has targeted particular problems in particular areas of the country. A September 2003 blitz found that one third of sites were well below standard. As part of a May 2002 blitz in Scotland and north-east England, as my hon. Friend the Member for Strathkelvin and Bearsden will know, the HSE visited 444 sites and found that more than half required health and safety action. What is more worrying is that the HSE gave advance notice that it would blitz those companies, yet it still came up with those horrific figures.
I am a member of Amicus, which has members in the construction industry and has been active in seeking to reduce deaths and injuries. The national construction sector conference was held in June. Unfortunately, Nigel Griffiths, the Minister for Small Business and Enterprise, was unable to attend. Particular concern was expressed about the continuing deskilling in the industry and the decline in apprenticeships. Amicus is very concerned about the dangers posed by the implementation of the EU posted worker directive. It believes that the importing of cheap posted labour undermines the safety, skills and job security of the whole UK construction work force. It also believes that if the directive is implemented properly, it will enforce minimum standards. However, it would appear that, at present, workers employed on contracts in other EU countries and not subject to the appropriate skills and safety standards will be allowed to be imported into the UK to work; the tendency is in some instances to undercut other companies on the basis of cheap labour.
Will the Minister take into account the fact that there are just over 100 health and safety inspectors in the inspectorate? That amounts to one per 20,000 construction workers. There is a need to strengthen the construction division, and I am sure that the HSE would welcome additional inspectors. That is one way to help to deal with the problem.
436WH
It is important, Mr. Deputy Chairman, to examine the issues of skills, the importation of foreign workers—we welcome them but must ensure that they are of the appropriate standard—and the strengthening of the health and safety inspectorate.
Several hon. Members rose—
Mr. Deputy Speaker: Order. Before I call the next speaker, I must point out that this debate is about enforcing the rules. I therefore remind the hon. Member for Hamilton, South (Mr. Tynan) that if he refers to another hon. Member, even a Minister, he should do so by referring to his constituency, which in this case was Edinburgh, South, or by his post—not by name. Also, I am certainly not a Deputy Chairman, whatever else I am.
Mr. Tynan: I take the point, Mr. Deputy Speaker.
10.11 am
David Hamilton: I thank my hon. Friend the Member for West Renfrewshire (Jim Sheridan) for securing the debate. It is appropriate to have the debate now, because the Work and Pensions Committee is also investigating health and safety matters in industry. I believe that it is the first review of its kind by the Work and Pensions Committee and that the report will be a worthwhile document. That is not just because I am a member of the Select Committee, but because we have had discussions that seem to me quite important.
The subject before us today is one of the most important for the industry. Everyone wants our building industry to prosper, but we want people who work in it and their families to know that they will return home safe in the evening after a day's work. Our job as politicians is to create a fair playing field. I remind colleagues and Ministers that we set the rules by which the industry works. If we tell the construction industry that we want it to work using the highest levels of safety, it will agree with us, because the legitimate companies argue that they will comply with the dictates of the companies that procure the contracts.
The Government, local councils and health authorities are among the biggest contractors. The Construction Confederation, representing the building trade—it represents more than 5,000 companies and 75 per cent. of the industry—wants as much as we do to eliminate the cowboys. We should accept only those with a record of the highest standards to tender for contracts. If the public sector cannot determine who the contractors are, who can?
I worked in the mining industry for more than 20 years. I was on the safety committee of the colliery for more than 10 of those years. At its peak, there were 2,000 employees. More than 30 years ago in the pits, men still had to buy safety equipment, boots, gloves and tools. Hon. Members can imagine my horror when I found out from the Scottish regional secretary of UCATT, Alan Ritchie, that some workers still have to do that in the 21st century.
I agree with my hon. Friend the Member for West Renfrewshire about migrant workers. Building sites are by their nature dangerous, but we employ thousands of

437WH
migrant workers, while providing little or no training in the English language. In one of the exercises that we conducted in the mining industry all those years ago we found that 10 per cent. of the work force were dyslexic or suffered some form of dyslexia. If that is the case for British people, let us imagine the problems entailed in bringing in migrant workers.
It is 40 year since the Health and Safety at Work, etc. Act 1974 was passed. I was still at school. A car was something that most people dreamed about. A telephone was something that a neighbour might have, if we were lucky. A colour TV was pie in the sky in those days. Television programmes came on for an hour in the afternoon. Scottish Members will remember that it was the Larry Marshall show at 1 o'clock in the afternoon. Then it started again at 5 o'clock and finished at 10 o'clock. In those days, "going all the way" meant you were going to the bus terminal. That was the difference way back then. The United Kingdom's safety record of more than 1,000 workers facing injury and death every year should not be tolerated in this day and age, and it is unbelievable to think that, in the 21st century, we are still working to 40-year-old legislation. The people we represent deserve better and there is no reason why we should deny them the working standards of which we should be proud.
The Minister should consider the following example: I went with the Work and Pensions Committee to what will be the world headquarters of the Royal Bank of Scotland, which is being built just outside Edinburgh. It will be a massive building, and more than 1,000 people are employed on site. The contract is being completed under time, under budget and with the best safety record in the UK. There are more than 30 contractors on site and each one must undergo training. There is a system of points and incentives to ensure that they work to the highest standards.
We, as legislators, have a responsibility, and our approach should be radical. The building industry already has an arrangement with CITB-ConstructionSkills. If it were to pay a small levy, it could be transferred and, with Government support, it would surely be possible to have health and safety representatives who could work with employers and unions towards establishing the right working environment. What is needed is a healthy work force, with training strengthened to encourage the development of transferable skills and with reward for achievement. Employers should see the unions as an asset, not a threat, and treat relationships with trust. Management should have a high-calibre work force, invest time and resources in people at all levels, have a strong communications strategy that allows the sharing of knowledge—that does not happen in the industry at present—have safe and productive working conditions and a well planned and logistical strategy. All those things can be achieved. That is the type of administration that is demanded on the Royal Bank of Scotland site, which will employ 3,000 people when it is finished. The people in Britain do not want workers to
438WH
be injured or killed because of shortcuts and good companies do not want that either, so why do we allow it?
Mr. Davidson rose—
Mr. Deputy Speaker: If the hon. Gentleman is brief, I will call him.
10.18 am
Mr. Ian Davidson: Thank you, Mr. Deputy Speaker. I draw the Minister's attention to the recent report by the National Audit Office and the hearings that were subsequently held by the Public Accounts Committee. My hon. Friends have referred to matters that I hoped to cover, but which I shall drop because time is short.
The one issue that has not been adequately discussed is the responsibility of designers for work and safety. The National Audit Office report indicates that research undertaken by the HSE and the European Foundation for the Improvement of Living and Working Conditions suggested that mistakes made during construction in the design phase led to 60 per cent. of fatal accidents. That is corroborated by groups such as the Major Contractors Group, the Strategic Forum for Construction, the Federation of Master Builders and others. However, the response from the professionals involved in design was shocking. The NAO report states:
"The Royal Institute of British Architects … questioned whether there were sufficient incentives for designers to 'design out' hazards, as this would lead to an increase in costs to the designer which could not necessarily"
be recovered. That is a clear example of designers placing their profits and financial well-being above the lives of workers in the construction industry.
In a survey of designers undertaken by the HSE, one third displayed virtually no knowledge of their responsibilities under the relevant legislation, many lacked knowledge of their duties and some did not even accept that they had any responsibilities, believing that all responsibilities for health and safety fell upon the contractors on site. In those circumstances, when designers who are adequately paid and in many cases overpaid, fail completely to take into account the implications of the designs on the safety of their work force, something should be done. Given that 60 per cent. of fatal accidents art traced back to design faults, I hope that the Government will undertake work in this area as a matter of considerable urgency.
10.20 am
Mr. Steve Webb: I join other hon. Members in congratulating the hon. Member for West Renfrewshire (Jim Sheridan) on introducing this important subject. Everyone who works in the construction industry owes him a debt of gratitude for putting it on the agenda today.
Deaths in the construction industry sadly affect all parts of the country. Perhaps the most notorious case in my part of the world in the west of England concerns the deaths of four construction workers on the Avonmouth bridge. They were doing repairs to the bridge on the M5 near Bristol when they fell 100 ft from a gantry to their

439WH
deaths. The case has been through the courts, and the judge who passed sentence at Bristol Crown court in 2001 commented that there had been a
"blatant disregard for basic health and safety legislation over a long and sustained period of time."
That is the culture that we have been talking about today.
Interestingly, the fines in this case were £250,000 for each company involved. No figure is enough to compensate for a life, but that seems to be the kind of figure that we should be talking about. A Health and Safety Executive representative said:
"The fine imposed is there as a reminder of the financial costs of accidents at work. The human cost is incalculable."
It is striking from what we have heard from several Members that such large fines are the exception and that all too often fines are pitiful.
When we debated a private Member's Bill introduced by the hon. Member for Edmonton (Mr. Love) on 14 May this year, the hon. Member for Hendon (Mr. Dismore), a member of the Select Committee on Work and Pensions, discussed the level of fines. He said that the Committee, which had investigated the issue, had been told that the average fine following a prosecution after a death at work was about £9,000—that is in the more serious cases. He compared that with the penalty for one day's delay in delivering a contract of £20,000. As several hon. Members have noted, that indicates the relative priorities that we seem to attach to the value of construction workers' lives.
We have heard some important contributions. We heard predominantly from hon. Members from Scotland, and it was interesting that the hon. Member for Strathkelvin and Bearsden (Mr. Lyons) suggested that there was a Scottish dimension to the problem. Five of the six hon. Members who have spoken so far represent Scottish constituencies, and they might want to take that point up with the HSE, because it does not accept the view. Its research, a summary of which I have here, made the findings that one might expect: the major causes of fatalities are falls and the majority of fatal accidents happen on smaller sites. However, it said that there is no specific association with time of day, age of worker or nation or region. If there is a particular Scottish dimension that the HSE is not picking up, it is important that hon. Members relay the information to it. There is clearly a difference of opinion.
The hon. Member for Barnsley, West and Penistone (Mr. Clapham) made an important point about the role of main and subcontractors and ensuring that the highest standards of health and safety are part of what main contractors try to obtain. I was interested in the idea that we could use a discount on insurance as a lever. Will the Minister say whether she has had any discussions with the insurance industry on whether they could be engaged in giving subcontractors an incentive to take health and safety seriously?
The hon. Member for Hamilton, South (Mr. Tynan) made a powerful case when he showed how we take some trivial offences very seriously and lock people up for minor offences while we do not have serious penalties for people whose negligence results in the deaths of workers in the construction industry. There are serious questions about how we should respond.
440WH
Corporate manslaughter and the time for legislation on it have been raised. Will the Minister tell us where the Government have reached in that process?
The hon. Member for Hendon, whom I quoted earlier, cited the fact that a director who gets their company accounts wrong can be disqualified, but if their negligence leads to someone being killed, they can just carry on. That does not seem right, and I hope that the Government will take action on it.
The hon. Member for Midlothian (David Hamilton) mentioned the work of the Select Committee on Work and Pensions, and it is welcome that it is taking health and safety seriously as a topic of investigation. I shadow a Minister in the Department for Work and Pensions, and health and safety is in danger of becoming a Cinderella subject in that Department; it came to the Department when employment matters were transferred to it. I would be interested to hear the Minister's honest reflections on how much of her time health and safety matters take up. I am aware that she is responsible for a range of other issues, such as welfare to work, so how important is health and safety in comparison, and how much of her time is required for it? Does she feel that enough governmental time is devoted to health and safety issues?
Some of the statements of Ministers and hon. Members highlight the fragmentation of responsibility. As I understand it, there is a Minister with responsibility for the construction industry in a different Department. One would hope that that Minister is concerned about health and safety in construction, yet he is in a different Department from the Minister with responsibility for health and safety. Is such fragmentation a problem, and, if so, what can be done about it? How closely can the Minister work with her opposite number at the Department of Trade and Industry?
The hon. Member for Glasgow, Pollok (Mr. Davidson) referred to the National Audit Office report on construction industry deaths, which came out a couple of months ago. It made an important contribution. He mentioned, in particular, the contribution of designers. That subject did not immediately occur to me, but the more I think about this issue, the more it becomes clear that it is important that the people who design buildings and decide on the way in which they are constructed should think about safety issues. That is obvious, but many of them did not appear to be aware even of their legal obligations. The Health and Safety Executive could do more on that.
Finally, I want to touch on some of the recommendations that the NAO made in its report. The hon. Member for Hamilton, South mentioned that, in 2001, the industry set itself a target of achieving a 40 per cent. reduction in deaths by the middle of this decade, and a 60 per cent. reduction by the end of it. I was not there, so I do not know how those figures were decided on, but I can almost sense that people said, "We have got to come up with a target," and yet the nitty-gritty of how it will be delivered was not addressed.
The hon. Gentleman rightly suggested that those targets would not be met. We all want a target of 100 per cent., because we do not want any deaths in the construction industry, but targets that cannot be met are almost meaningless. The NAO calls upon the HSE to

441WH
ensure that the industry sets itself more specific and low-level targets for particular types of construction and activities—deaths from falls from heights, for example. The industry should do that.
We have heard about the blitzes that the HSE conducts. The NAO thinks that it could do more to publicise them, so that everybody knows that they could be next. As the hon. Member for Midlothian mentioned, even when sites are told that somebody is coming, there are still gross breaches of regulations. That is appalling. The NAO wants the HSE to return to the sites where it has done its blitzes more often so that they are not one-hit wonders, and to see whether anything has been done and to get tough if it has not. I support that.
The HSE should do other things, too. It should liaise not only at high levels with major Government Departments, but with all the people in the public sector who tender for and let out construction contracts, and with non-departmental public bodies much further down the supply chain.
In construction contracts, the NAO suggests that delivering health and safety should be part of what we mean by getting value for money for the taxpayer. It is interesting that that should be recommended in a report by a bunch of auditors. I think we all support that.
There is no shortage of aspirations, fine words and targets, but we do not seem to be making progress at the speed that everybody who works in this industry has a right to expect. That is why it is particularly valuable that the hon. Member for West Renfrewshire has brought this subject to the House's attention.
10.29 am
Mr. Henry Bellingham: First, I declare my interests, which are listed in the Register of Members' Interests. I also want to point out that, in fact, I shadow the relevant Department of Trade and Industry Minister, and that I am here in place of my colleague who shadows the Department for Work and Pensions Minister. As the shadow construction Minister, I have been following the issue carefully.
I congratulate the hon. Member for West Renfrewshire (Jim Sheridan) on securing the debate and on the excellent way in which he put his case forward. I was fortunate enough to be in the Chamber for the Second Reading of his Gangmasters (Licensing) Bill, which I am pleased has now passed through the House. The hon. Gentleman's tenacity in pushing that Bill forward showed how effective he is as a parliamentarian. No doubt, he will return to the issue under discussion time and time again.
I represent the area in west Norfolk in which CITB-ConstructionSkills has its headquarters and the National Construction college. Both work closely with the college of West Anglia in King's Lynn and, between them, they provide a number of important vocational training courses. I have been to the CITB at Bircham Newton many times. It offers training across the whole construction sector, places an overwhelming emphasis on safety, and makes constant efforts to drive up standards.
The hon. Members for Strathkelvin and Bearsden (Mr. Lyons) and for Hamilton, South (Mr. Tynan) mentioned the modern apprenticeship scheme. That
442WH
scheme is now locked closely into a number of the training courses in construction skills provided by CITB-ConstructionSkills.
It is worth reiterating the importance of the statutory levy, which was mentioned by the hon. Member for Midlothian (David Hamilton). Without that levy, the CITB would not be able to provide the training. Since I have been following the activities of the CITB, there has been increasing emphasis on trying to reduce the number of injuries and tragic deaths in the construction industry. If the levy system were voluntary, there would be nothing like the level of training in the UK that is currently provided. As the hon. Member for West Renfrewshire and many other hon. Members pointed out, the situation with regard to deaths in the industry is worse than it should but it would be worse still if we did not have the statutory levy. I do not believe that there is any debate between the parties about the levy, but I take every opportunity to put on record my support for it. I urge Ministers to put their support for it on the record.
One of the points that was made—I think by the hon. Member for Barnsley, West and Penistone (Mr. Clapham)—concerned the fragmentation of the industry: the proliferation of sites and subcontractors, and the problems that that causes for the major contractor.
When the tragic accident at Potters Bar occurred, I focused on it carefully, because the train was on its way to my constituency. I nearly took that train, but missed it and took the next one—which was, of course, much later. The contract in that situation was fragmented: there were a number of different subcontractors. The hon. Member for Barnsley, West and Penistone made the important point that a safety protocol should be embedded not just in the main contract but in the subcontracts. Had that been the case with Jarvis at Potters Bar, there would not have been the lax safety standards that led to the tragedy of the derailment.
There is obviously a challenge posed by language and cultural barriers. I am pleased that CITB-ConstructionSkills has introduced a comprehensive health and safety test, which now has a pass rate of 85 per cent. Half a million people have now passed that test. The test is an important part of the construction skills certification scheme, which is the skills passport for the industry.
I hope—I should like the Minister to comment on the matter—that major contractors will soon start to stipulate that subcontractors should have a carded work force on all sites where they are working for the main contractor or are part of a contract chain. The health and safety test imposes pretty rigorous standards, and I understand that, in that context, CITB-ConstructionSkills now receives 20,000 applications a week for the skills passport. If we can move forward to a fully carded work force, that would make a huge difference.
The language barrier that is often found on sites was raised by a number of hon. Members. CITB-ConstructionSkills and the National Construction college are now providing extensive safety training in different languages. For example, Laing O' Rourke Learning has set up an organisation called Learning World to train a number of its different contractors at

443WH
Heathrow terminal 5 in different languages. That is very positive and I hope that more companies will set up similar initiatives and schemes.
A number of hon. Members, including the hon. Members for Northavon (Mr. Webb) and for West Renfrewshire focused on the fines that are levied on negligent construction companies. which are partly the cause of deaths on construction sites. However, I am not clear—perhaps the Minister can elaborate—whether fines are levied for exceeding the limits set by the legislation or for causing an accident by adopting a cavalier and lax attitude. I join the hon. Member for Northavon in asking the Minister to tell us more about the Government's current thinking on introducing a new offence of corporate manslaughter. Can she also comment on the excellent idea put forward by the hon. Member for Barnsley, West and Penistone of trying to persuade the insurance industry to offer discounts on their employer and public liability premiums to companies that are able to embed safety protocols not just in the main contract but in the subcontracts?
I read the other day—perhaps the Minister and her officials also spotted it—that the National Federation of Roofing Contractors has entered into an exclusive agreement with a particular insurance company, so that any of its members who sign up to a fairly comprehensive safety protocol receive a substantial discount on their insurance premiums. I should like to see other trade associations and federations do the same, and perhaps the Minister can do something to encourage that.
The point about self-employment is important, because there has been a substantial debate in the Department of Trade and Industry, the Department for Work and Pensions and the Treasury about false self-employment. I urge the Minister to consider that a lot of small construction companies, many of which I meet as I go round the country, tell me about the stiff regulatory barriers that they face when taking on employees. There is currently a hefty disincentive to employ people, which is why there is every advantage, for employer and employee, to ensure that they are self-employed subcontractors. That is a real issue, so perhaps the Minister can say what the Government's current thinking is.
I notice that the hon. Member for West Renfrewshire alluded to the construction summit that took place in 2001. I remember the great fanfare that greeted that summit: a lot of discussions took place, which generated hope and optimism. Targets were set and a lot of good came out of it. However, we must hear from the Minister an update on how the Government consider the initiatives that came out of the summit. It supported a lot of good initiatives, but as hon. Members have pointed out, the number of deaths in the industry has unfortunately remained rigid at about 80–86 last year. If one adds to that the deaths from asbestos-related injuries and illnesses, the figure obviously goes up. I hope that today's debate will act as a watershed, because it is the first time since I have been a Member, both this time and the previous time, that we have had a debate on the issue. It is a vital issue, and let us hope that not just words but action will come out of this debate and, as a consequence, lives will be saved.
10.39 am
The Minister for Work (Jane Kennedy): May I add my congratulations to all those that have been expressed this morning to my hon. Friend the Member for West Renfrewshire (Jim Sheridan) on securing this debate and on bringing the challenge to me, newly in position as the health and safety Minister? This is the first opportunity that I have had to consider the issue, and I have been sobered by the details that have come out not only in the contributions but in my preparations for the debate.
I also thank my hon. Friend for his work in bringing forward the Gangmasters (Licensing) Act 2004, which received Royal Assent on 8 July; other hon. Members have also congratulated him on that. The Bill was strongly supported by Ministers in its passage through Parliament. and I am pleased that it is now on the statute book.
I apologise in advance if I miss any points that have been raised; I will seek to address all of them. This has been a robust but courteous debate. The issues are extremely serious and, at the outset, I would like to offer my condolences to the families of the three agricultural workers who died on Monday in Norfolk in the course of their work. When I was preparing for this debate, I looked at the figures for this year. I had prepared to say that the number of fatal construction accidents this year stood at 11, but, sadly, a worker yesterday suffered a fatal injury at a construction site in Purfleet, Essex, so the total is now 12. I want to put on record my condolences to the families of those killed.
As we have already heard, there can be no doubt about the poor record of the construction industry. I would like to pick up on a number of points made. My hon. Friends the Members for Hamilton, South (Mr. Tynan) and for Glasgow, Pollok (Mr. Davidson) and the hon. Member for Northavon (Mr. Webb) drew my attention to the National Audit Office report. I am grateful to them for that, and I will look at the report as a result of this debate.
My hon. Friend the Member for Midlothian (David Hamilton) invited me to consider the Royal Bank of Scotland construction site. I will look into that. If I get the opportunity to visit bonny Scotland, I will perhaps see whether I can fit in a visit to that site.
The hon. Member for North-West Norfolk (Mr. Bellingham) is welcome at our debate. Many of us came at the issue with a Health and Safety Executive focus, but the hon. Gentleman, in a useful, interesting and challenging contribution, asked me to speak about the compulsory levy that contributes to the training of construction workers. I am happy to say that we support that levy. It is without question a practical way to ensure that the industry invests in training. Health and safety law requires that workers and managers be trained and competent to carry out their functions. It is important to bear that in mind when considering the issues.
My hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) raised a number of issues. I am grateful to him for the role that he plays on this subject, wearing a number of hats. Not least, he is chair of the all-party occupational health and safety group and its asbestos sub-group. He invited me to consider the question of partnership. I will talk about that in greater detail later. I will think carefully about his idea

445WH
which the hon. Member for North-West Norfolk commended—about major contractors and the role that they play. I will touch on that point in a moment.
My hon. Friend the Member for Barnsley, West and Penistone and the hon. Member for Northavon invited me to think about how the insurance industry works with contractors and construction businesses. During the review of the employers' compulsory liability insurance difficulties experienced over the last year, we worked closely with the Association of British Insurers and the Health and Safety Executive. We are looking into ways in which the risk can be assessed properly. Employers—not just in the construction industry but in all walks of life—who demonstrate that they take health and safety seriously, who manage properly the incidents that occur to their work force and who can show that the number of incidents is as low as possible should get some relief from the insurance premiums that they face. We are working to secure that. That will benefit everybody.
Every Member who has spoken has commented on the level of penalties and fines applied. I want to make it absolutely clear that the general level of health and safety fines does not reflect the gravity of the relevant offences. That is why we were pleased as a Government to support the private Member's Bill that was introduced by my hon. Friend the Member for Edmonton (Mr. Love). That received a partial Second Reading in May; it is due to receive a further Second Reading this Friday if it is fortunate enough to be reached, although it is fairly low on the Order Paper. That Bill would certainly be a major step forward. The problem is partly that the fines are not high enough but, as the hon. Member for Uxbridge (Mr. Randall) said, it is also because the courts do not apply the available fines. The Bill will send an important message to those considering these issues in a legal setting.
I want to make two further points about Crown immunity and corporate manslaughter. If the Bill of my hon. Friend the Member for Edmonton does not make progress, the Government need to consider the consequences of that and find another way of bringing about those changes. I reassure hon. Members that we are actively looking for a way of making progress on all these issues. It has been a long time, and I acknowledge the justice of what my hon. Friends have said. Home Office colleagues are taking forward the questions of corporate manslaughter and Crown immunity. We are working on a draft Bill, and the aim is to have that published towards the end of this year—perhaps the back end of autumn. That is our objective. In spite of the number of green seats between us, I hope to be able to demonstrate to hon. Friends that, in fact, we stand shoulder to shoulder on many of the issues that they have rightly raised.
One or two things should be said about what is happening in the construction world. It is of no comfort, but it is a factor that we should bear in mind, that the UK construction accident rate is the second lowest of any European Union state and significantly lower than the larger member states. Good though that may at first appear, we acknowledge that nearly 850 workers and members of the public have died as a result of accidents in the construction industry in the past 10 years. Many more have died as a result of exposure to asbestos, as my
446WH
hon. Friend the Member for Barnsley, West and Penistone rightly pointed out. In fact, to describe the increase in the numbers of those suffering from asbestos-related illnesses as an epidemic to be faced over the coming years would not be too strong. Thousands more have been seriously injured as a result of accidents or have had their lives blighted through damage to their health and well-being. As has been said, we must remember the wider impact on families and friends. They, too, suffer when injuries and deaths occur.
At its best, however, our construction industry is world class. We all benefit from the improved built environment that the industry provides: new houses, schools, hospitals, a better transport system and other essential infrastructure. However, we should not and cannot accept that those gains should be at the cost of damage and suffering to construction workers and their families. The industry must improve its performance in controlling and managing the safety and health risks that it creates.
Many hon. Members drew attention to the summit in February 2001 at which my right hon. Friend the Deputy Prime Minister set down some major challenges to the industry. We should remember that, at that time, there were a shocking 113 deaths of workers and members of the public in a single year. Commitments were given at the summit by all those who have a stake in the industry, including clients, designers—about whom I will talk more in a moment—suppliers, contractors and trade unions. That meant accepting responsibility for the industry's health and safety performance and giving it a priority in terms of business risk management to achieve dramatic improvements, and we heard about the target of a 10 per cent. year-on-year reduction in deaths and major injuries.
Since then, the number of deaths has reduced to 76 and 71 in the two most recent years. I did not recognise the figure of 80, but I will check the figures that we have been discussing. However, the record is less clear when major injuries are also taken into account. I acknowledge that the industry is well short of its target to reduce the rate of fatal and major injuries by 40 per cent. by 2004–05. It is not clear that there has been any marked improvement in reducing ill health. Major challenges face all the industry's stakeholders.
Those commissioning the work—the clients, who have been referred to as contractors—must do more to meet the challenges set by Ministers in the strategic forum for construction, which is convened by my right hon. Friend the Member for Cunninghame, North (Mr. Wilson). The purchasers—the clients—must provide leadership to the teams that they create, make clear their commitment to respect the people who will work for them and reject those who do not measure up. My hon. Friends are right to point out that, as major purchasers of the industry's services, central and local government need to ensure that they follow the practice of best value and not lowest cost, so that whole-life health and safety issues are addressed to reduce injuries, whether caused during initial construction, or, equally importantly, during subsequent maintenance.
My hon. Friend the Member for Glasgow, Pollok questioned the role of designers. He is right to draw attention to that; designers have yet to engage fully in reducing the likelihood of injuries by improving the quality of their designs so that potential hazards are

447WH
eliminated at the earliest possible opportunity—in the design office itself. Designers can, for example, specify lower-weight building blocks to reduce the risks involved in manual handling. Through the design process, they can also reduce the need to work at height. A recent HSE survey suggested that there is increasing commitment by designers. However, as my hon. Friend rightly said, that has come from a very low base.
Equally, suppliers could do more to improve the products on the market. For example, heavy components that have to be manually handled create problems, and advances in reducing the weight of pre-packaged materials need to be rolled out more widely. There should be joint development work with others in the supply chain, so that off-site prefabrication, which we see more of these days, reduces on-site risks. Such things hold out further opportunities for manufacturers to make a contribution to the health and safety agenda. Contractors also have to commit more positively to the provision of decent working conditions, put that at the top of their agenda and improve the ways in which they engage with those who work for them.
As the Minister responsible for health and safety, I am pleased to give my support to the Health and Safety Commission's document "A strategy for workplace health and safety in Great Britain to 2010 and beyond". The hon. Member for Northavon asked me how much time I devote as a Minister to health and safety. I commit half my working time to it because health and safety matters are so pressing and urgent in the Department. The role that I play in liaising with the Health and Safety Executive and the Health and Safety Commission is demanding, and rightly so.
Hon. Members may not be aware that long before becoming a Member of Parliament—more than 25 years ago—I trained as a Workers Educational Association health and safety TUC instructor. I well recall working with shop stewards in training courses in Liverpool. I have an anecdote about a self-employed construction worker who worked, I think, at the Shell oil refinery at Ellesmere Port. He described how he had been instructed to travel from one side of the site to the other. He and his comrade, who was also self-employed. loaded up the back of the flat-bed truck that he owned. They put their acetylene torches, the accompanying paraphernalia and the brazier that they were to use at the next point on the site on to the truck and they trundled off across the vast chemical plant. They did not see a soul on the site and when they arrived at the other end, they climbed out of the cab of their flat-bed truck and found that the brazier had reignited. They had thought that it was out, but it had reignited when they started and, by the time they reached the other end of the site, it was ablaze. Presumably, they had trundled the blazing truck right the way through the centre of one of the most dangerous sites in the UK. That indicated to them that, self-employed or not, they needed to get some training and to understand what they were doing in terms of safety.
That is a good point at which to remind everybody that all workers, irrespective of their status—whether they be migrant workers or self employed—are covered by UK health and safety legislation. I hope that that reassures those who had concerns about migrant workers. The question of language problems needs to be addressed by employers when they take on subcontractors who may have such difficulties.
448WH
The strategy that the HSC and HSE have developed signals a new approach, which recognises that they have to work with others to develop closer partnerships in creating a sensible health and safety culture. I am also pleased that the construction industry has been identified as a priority for action by the HSE. The creation of a separate HSE division that is tasked to challenge the industry makes clear the HSC's commitment to the construction industry's problems as part of the new strategy. There are more inspectors and support resources tasked to construction than ever before. That was a point about which reassurance was sought and I hope that that has helped.
The HSC is taking forward the development of two codes of regulations that are particularly relevant to the construction industry: the work at heights code, and the design and management of construction work. I know that some stakeholders have concerns and also that the HSE is in close consultation with them so that the outcome will be regulations that add value by reducing injuries and do not simply increase bureaucracy. We must acknowledge that the HSE alone cannot put right the health and safety performance of the industry. Those who commission, provide and maintain the built environment create the risks and they must take responsibility for working in partnership to manage them.
Partnership working was amply demonstrated when Andrew Smith—I beg your pardon, Mr. Deputy Speaker—my right hon. Friend the Secretary of State for Work and Pensions—
Mr. Deputy Speaker: The right hon. Member for Oxford, East.
Jane Kennedy: Oxford, East. I have no excuse. As a former Whip, I should know all that. It should be on the tip of my tongue.
Partnership working was amply demonstrated when my right hon. Friend announced on 30 June the success of two bids made jointly by construction trades unions and employers for a share of the £3 million workers' safety adviser challenge fund. Workers are the ones who are exposed to the risks and in many workplaces they have not been fully heard. Evidence shows that when workers have a voice and influence, workplaces become safer and health risks are better controlled. I congratulate the social partners that made the successful bids—UCATT, the National Federation of Builders, the Transport and General Workers Union and the Federation of Master Builders—so that sustainable workers' safety advisers can be established in the south-west and the midlands. Partnership has equally been successfully demonstrated from the summit until now.
Since the summit and since the targets were set, I would acknowledge that the construction industry has not been on course to meet them. All of us who have an interest in making the industry safer must join forces to ensure that we work harder to achieve those targets.
Mr. Deputy Speaker: May I thank all the hon. Members who have taken part in this debate for their co-operation? It has been a good, if not a model, Westminster Hall debate.

Way to Go Campaign
11 am
Mr. Colin Challen (Morley and Rothwell) (Lab): I am grateful for the opportunity to speak about the Way to Go campaign, which was launched by more than 30 non-governmental organisations with environmental and social objectives to set the pace in developing a progressive transport policy that places greater emphasis on public transport, cycling and walking.
I speak as one who has been a motorist for more than 30 years and who, until recently, according to the chart in my doctor's surgery, was categorised—unbelievably, I have to say—as obese. However, I have started a diet and taken up regular cycling again. I am no longer in the red column, but have moved into the pink, which is for those of us who are merely overweight.
I have been relearning the simple message that "lifestyle" and "healthy" should go hand in hand. However, in today's society they often do not. What is promoted as a good lifestyle these days will usually allude to cars, fast food and one's desire for convenience. Around the time that I was born, traffic was measured at about 33 billion vehicle miles. Now the number has risen to more than 300 billion vehicle miles and shows no sign of abating, which is not surprising as the cost of motoring continues to plummet and the costs of other forms of transport continue to rise.
The costs of obesity continue to increase, too. The Health Committee estimated the expense to the national health service of dealing with obesity at £3.7 billion a year. When we consider the proposals of the Way to Go campaign, which amount to the capital and revenue sum of £1.75 billion each year to 2010, we should consider how much we could save elsewhere. That is a central feature of the Way to Go campaign and why it was initiated not only by environmental or transport groups, but by such organisations as Help the Aged, Age Concern and the women's institute. They know that we need a transport strategy that is about social justice, as well as greening the environment. The organisations know that, if the campaign bears fruit, it will deal with social exclusion and give more people real mobility, as opposed to congestion, pollution and health problems—especially for those who live in inner cities and have to cope with the fumes spewed out by commuters' cars. We would have better rural services, too, which is why the Campaign to Protect Rural England also supports the Way to Go campaign.
The Government need to build on their successes. I welcomed the Secretary of State for Transport's announcement last week about car sharing on motorways and the recent publication of the walking and cycling action plan. I am pleased that the Department for Transport has a new public service agreement target to deal with climate change. I am delighted that, yesterday, the Government introduced a transport renewable fuel obligation to the Energy Bill. I welcome the fact that they have an open mind about new ideas and new ways in which to develop partnerships to deliver better transport.
I also acknowledge that the taxpayer does not have a bottomless pocket to pay for schemes and that the Government rightly want to obtain the maximum benefit from whatever schemes are proposed. I know
450WH
very well how such strictures are applied because, at the local level, the Leeds supertram—a proposal that I support—has over the past 15 years or so seen its projected capital costs increase from £330 million to about £800 million. What a shame that the Leeds supertram has had so many false starts, but it is not alone. I recognise that the costs in general of light rail systems have mushroomed and that we have to be sure that they can deliver value for money. I believe that, in this instance, the case for that can still be made.
Can the same be said for all the road schemes still on the books? In an answer to a recent parliamentary question, I was told that the targeted programme of improvements had risen from £7,761 million to £8,781 million—an increase of more than £1 billion or, in itself, more than enough to fund the entire Way to Go capital proposals for the next six years. The amount is enough, in other words, to fund a cycle-friendly road network, cycle training for all, networks of bus lanes, the promotion of bus services, safe routes to schools, 20 mph speed limits in residential areas, the restoration of streets and pavements to good condition, quality standards for buses and trains, and grants for rail freight projects.
Mr. Paul Truswell: I congratulate my hon. Friend on securing the debate and on his sterling advocacy on behalf of the Way to Go campaign. I hear what he says about investment. Does he agree that the vast majority of passenger transport journeys are made by bus, and that since the ill-advised deregulation of bus services in 1986, patronage has plummeted, mainly because of unreliability, escalating fares and the constant chopping and changing of timetables?
Does my hon. Friend also agree with the 106 hon. Members who signed early-day motion 518 that the successful bus franchising in London should be extended to other places, such as the West Yorkshire passenger transport area. to secure quality bus contracts that strike a better and fairer balance between passengers and profit?
Mr. Challen: I am grateful for my hon. Friend's intervention, and I agree with what he says; I think I am a signatory of the early-day motion. The Government should listen carefully to those proposals, as in the last 20 years, bus passengers have been ill served by the dogmatic, ideological Thatcherite deregulation in 1986. The Way to Go proposals, which may one day include those ideas too, are excellent. They have been costed and are waiting to go.
Last week, I read about the proposals from Central Railway to develop a new freight service between the north-west and the south-east, which would have a major impact in reducing both congestion and the need for extra lanes on the M62—one of Europe's busiest motorways, which goes through my constituency. Those proposals would boost the economy of the north-west, and I hope the Government consider them seriously.
As we review the transport strategy, we should try to apply a much greater vision and escape from the predict-and-provide shackles of the past. Roads will take the largest slice of funding for the foreseeable future and the car and road transport lobbies will say that they make a

451WH
massive contribution to the Exchequer. That is true—I do not dispute it—but what often does not enter the equation is the huge environmental cost of road transport.
I acknowledge that there have been improvements such as reducing pollution from individual cars and that fuel consumption overall has moderately eased off in the last three or four years, although the long-term trend is up. Road traffic has increased by 79 per cent. since 1980, and fuel consumption rose by 53 per cent. in the same period. Since 1990, CO2 emissions have risen by 11 per cent., and transport on the ground and in the air threatens to wreck the Government's greenhouse gas emissions targets. My question is, what would happen if the costs of global warming were to be internalised in our assessment of the real cost of motoring? Given that road transport contributes 25 per cent. of our carbon emissions, compared to just 1 per cent. for rail, it is easy to see where the burden of improvement lies.
Adjustments have been made to vehicle excise duty to reflect the fact that smaller engines pollute less, but it would make sense to carry that logic through and to make larger engines pay more than the standard rate of VED. As any study will show, most four-wheel drives sold on the market today never see an off-road track, and for that the countryside must be grateful. These behemoths clog up our urban roads, but their fuel efficiencies are disgracefully low. Their owners may argue that they are therefore paying more in fuel duty, but that is to miss the point entirely. They were described by the Mayor of London as complete idiots, which may explain why 4x4 owners can so easily miss the point. Apart from the greater pollution they cause, they also hasten the demise of a finite resource. If they cannot be trusted to be the guardians of their children's future, the Government should take that small step and do it for them. Would that be such a terrible thing?
A modest adjustment in VED would pay for much of the Way to Go campaign's manifesto and it would save lives, too. Four-wheel drives have been shown to have a far higher risk of causing death to cyclists and pedestrians than ordinary vehicles, because of their greater height and bulk.
That proposal is an example of integrated transport, and we could use the money to train cyclists, as most journeys made are less than 5 miles. I believe that the Government's target was to quadruple cycling, but we are well short of that: at just 2 per cent. of journeys made, we are abysmally short of the Dutch 28 per cent. or the Danish 18 per cent. The smart Alecs who scoff at our attempts to boost cycling will retort that Holland and Denmark are flat countries more suited to cycling and that, besides, they have all those dedicated cycle lanes. However, is Switzerland, where 15 per cent. of journeys are made by bicycle, a flat country?
We know that measures to increase cycling have precisely that effect. London has bucked the national trend, and cycling has increased considerably. That is because cyclists are considered important and deserving of road space in their own right. The congestion charge has helped by making the roads safer for cyclists and by forcing motorists to reconsider how they get to work. The Government's action plan for cycling is a welcome document, but it is described in the introduction as a beginning, not an end. I hope that that is true, as we have seen some false starts in the recent past.
452WH
There are other measures I would like to be introduced, which go beyond the Way to Go proposals and perhaps show that that campaign is too modest in its objectives. I note, for example, that the Environmental Transport Association—I am a member of it, so I have declared my interest—is promoting carbon emissions offsetting. Under that scheme, motorists can seek to neutralise their carbon emissions by funding renewable energy schemes such as paying for the distribution of free low-energy light bulbs or the planting of forests. What help for such schemes are the Government willing to offer? These initiatives are new and we should see whether there are new ways to support them—with tax breaks, for example.
I must also plug my ten-minute Bill, the Domestic Tradable Quotas (Carbon Emissions) Bill, launched last week. It shows how carbon trading at the individual level could help us all to reduce carbon emissions, and it might even raise a bit of money for the Government, which could be used to promote the schemes in the Way to Go manifesto.
We cannot afford to be timid in addressing the issues. We have panics about obesity, congestion and global warming, but we then comfort ourselves with the thought that, as change happens at such a slow pace, it does not really matter if we do not do something about those things today, if our next pair of trousers happens to be 2 in wider at the waist or if there is a slight change in the weather that means that somewhere else in the world a hurricane is stronger than usual. That is normally off our register.
Our psychology is the same in both regards, and collectively we persist in putting off the day when we take drastic action to tackle the problems. Like smokers, we always want one last fag. The question is, when are we going to curb our addiction to yet more roads and cars and recognise that what we need is not the transport equivalent of a nicotine patch, but a bit of exercise on the old step-change machine?
11.13 am
The Parliamentary Under-Secretary of State for Transport (Mr. Tony McNulty): I congratulate my hon. Friend the Member for Morley and Rothwell (Mr. Challen) on securing the debate. These are important matters.
I am grateful for the contribution that the Way to Go campaign has made to the review of the 10-year plan for transport. It has raised many points about how a future transport system could better service the needs of the population, and it highlights some key issues that the Department for Transport has regularly to consider as we aim to balance transport efficiency, safety and accessibility with achieving our environmental objectives.
As I hope to show, we are addressing many of, if not all, the issues in the Way to Go campaign, although I would be the first to agree that we need to go further in some areas. However, we start from the premise that we need a transport strategy that can meet the challenges of a growing economy, as well as a rapidly increasing demand for travel, and balance that with the environmental considerations to which my hon. Friend referred.
In passing, and no more than that, I say that the undercurrent of opinion that characterises our transport policy as "predict and provide" across all modes is

453WH
simply wrong. I will not go into substantive detail on the air transport White Paper, but it has been characterised as predict and provide, and it is not.
Much debate prompted by the Way to Go campaign starts from the premise that this Government are as voracious as previous Governments when it comes to road building. Well, my hon. Friend will know that we imposed a moratorium on road building soon after we came to government to take stock of where we were with the road network and to see how, rather than simply building roads willy-nilly, we could optimise existing networks. That is what we have done across the piece, including the air transport White Paper.
My right hon. Friend the Secretary of State for Transport has said time and again of the road network that we will not, and cannot, build our way out of congestion. That is central to all we do, but it does not obviate the need for a roads programme. There clearly is such a need, but this Government, unlike the previous Government, start from the premise of optimising the existing road network before creating more scars across the land.
Last year, in my previous incarnation as a Minister responsible for housing and regeneration, I took great delight in visiting any number of city centres where scars across our communities were being torn down. I am referring to the once-fashionable inner-city ring roads that simply went straight through communities. The people who had those roads built could not care less about their impact on communities and on air quality and the environment. I do not accept, therefore, the underlying premise that our approach is all about predict and provide, that over the past seven years this Government have done exactly the same as any previous Government, that we are in hock to the road lobby and that our approach is all roads, roads, roads as that is the only answer.
The Way to Go campaign has published a list of measures that it wants the Government to incorporate in the review of the 10-year plan for transport. I will dwell on some of those to see where we are with them, as a prelude to publication of the review. First, on the provision of cycle networks and training, the Government have been proactive in their efforts to maximise cycling as an alternative to the motor car. I congratulate the many local authorities up and down the country that have taken the provision of cycle lanes and networks seriously.
As my hon. Friend suggests, it is no accident that London is ahead of the game in that regard. That is because London boroughs and local political leaderships in London take cycling and the provision of cycle lanes far more seriously than their colleagues elsewhere. I would venture to say that that includes West Yorkshire, which is not the brightest light bulb in the box when it comes to such provision.
I am talking about not simply cycle networks and the like, but going beyond that and getting our infrastructure right in relation to the balance between public transport and the motor car. To many local authorities up and down the country, bus priority measures mean a bus stop, rather than a bus lane or similar devices. I endorse what the Way to Go campaign
454WH
says about getting the balance in many of our towns and cities much more favourably disposed towards all road users. I also agree with that in the context of cycling.
As my hon. Friend said, in June, after working closely with experts and organisations in each area, we published an action plan on our strategy to encourage cycling and walking. Improvements can best be driven through at local level, and the best councils are developing improved cycle routes as an integral part of their local transport plans. We certainly encourage that. Local authority spending on cycle infrastructure was about £45 million in 2003–04—up a third on two years earlier—but, as my hon. Friend said of the document that we published, it is a beginning. We have not secured everything we need in that regard. We have been working with more than 20 road safety and cycling organisations on a new national standard for child cycle training. Many other schemes reflect our commitment to those important issues.
I can reconfirm that buses remain at the centre of our strategy for local transport networks. The vast majority of public transport trips are made by bus. Overwhelmingly, buses connect our communities to key areas of employment, leisure, retail and other activities. In the context of transport as a weapon in the battle against social exclusion, buses are, will be and should be at the core of our strategy. We employ a host of measures to help to improve bus efficiency, including priority at traffic signals and access to vehicle-restricted areas. The Department has published local transport note 1/97, "Keeping Buses Moving: A Guide to Traffic Management". More recently, we published a guidance pack on behalf of the Bus Partnership Forum called "Bus Priority: The Way Ahead".
I repeat, however, that it is incumbent on local authorities to take these matters forward. I make no apology for getting local transport plan resources down to the local level over the past four or five years, so that in the first instance local authorities can determine what is necessary in terms of local transport for their own areas. When I appear before local government organisations or forums, I take every opportunity to repeat that it is in their hands not to describe bus priority measures as an add-on or a frill that they might get around to if they want. If we are serious about tackling urban congestion, the bald logic that 80 people on a bus is 80 people not in 50,60 or 70 cars must commend itself. However, there is no point having 50,60,70 or 80 people on a bus if all it is doing is sitting in the same traffic that everybody else is sitting in.
Local authorities can and should do more, and elected representatives in the House could do more with their local authorities to ensure not only that the buses work, but that measures are taken. We must get a better balance between the various users of road space. Many of the Way to Go policy proposals are about reconfiguring our public space, especially our road space, so we can achieve that. I endorse that, and local transport is central to achieving it.
We support the uptake of real-time information for bus users, which allows passengers to make better-informed decisions. In 2002, £20 million was allocated to local authorities to implement real-time information schemes. People will use the buses and rely on public

455WH
transport if they are reliable, efficient and safe and there is the necessary information for them to be able to rely on it.
Developing safe and efficient routes to school is also an important part of our transport plans. We have put into action a wide range of initiatives to improve travelling to school for children and parents, tackle rising car use on the school run and encourage healthy and safe routes to school. That should also be seen in the context of the anti-obesity campaign. Those initiatives include a travelling to school action plan and a good practice guide. We want every school in England to have a school travel plan by the end of the decade; all of them will focus on developing safe routes to school.
I turn to other issues highlighted by the Way to Go campaign. We believe that decisions on local speed limits are best made at local level. Local authorities already have the freedom to introduce 20 mph speed zones through their local transport plans. We recommend that 20 mph zones be installed near schools, where appropriate. Our child pedestrian casualty record has improved in recent years and we have a number of initiatives under way to reduce casualties further. My hon. Friend knows that our record in terms of the statistics on killed or seriously injured children and adults is far superior to that of most of our colleagues in Europe, but we can and should go much further.
The Way to Go campaign says that funding for local transport is a priority. We have doubled our capital funding for local transport, and we are delivering a sustained investment policy to ensure that we do not return to the days of stop-start investment in transport. We have not shifted the resources focus to the local dimension through the local transport plans simply to starve them of resources. Whatever the mode of public transport, throughout the past 20 or 30 years there has been stop-start investment, which has been detrimental to the entire public transport network. We must ensure not only that there is investment, but that it is sustained.
In December 2003, we announced an investment package of almost £2 billion in local transport—roughly three times the investment in the mid-1990s. We have also given local authorities extra power to solve local transport issues themselves. New guidance on the next round of local transport plans is due soon. In addition, almost £200 million has been made available in the three years between 2001 and 2004 to improve rural transport provision. I accept what has been said about the need for transport in rural areas. We have a rural bus subsidy grant, which has funded more than 2,100 new and enhanced bus services in rural areas in 2003–04.
I agree with the underpinning points of the Way to Go campaign, especially with respect to sharing very limited space when there is urban congestion. We are taking forward policies on streets in a manual for streets to help to provide guidance on the design and layout of roads.
The development of a tool to help local authorities to manage streets effectively has been proposed as part of the integrated local transport bid. That would help authorities to bring together the many different parties responsible for our modern streetscape. We cannot encourage people to walk far more in urban areas to alleviate aspects of urban congestion if the very act of walking is unsafe and unhealthy and takes people through what is almost a war zone or obstacle course.
456WH
It is necessary to reconfigure and to bring balance back into the equation in terms of design and what can be found on our streets and at road junctions. Professional engineers especially need to think about why people may walk through a certain area and whether some road space should be configured for pedestrians as well as for motorists.
Among other Way to Go priorities is the improvement of quality standards for bus and rail travel, which we are keen to continue. Journeys involving those will be improved by the new Transport Direct programme—a comprehensive national information service covering all modes of transport.
We are determined to improve standards by making buses and trains more accessible. With 1,400 new rail vehicles entering service over the past two and a half years, and another 1,000 to come over the next 18 months, we will see a big improvement in rail services and accessibility in many areas.
Mr. Challen: On rail travel, a senior executive of a train operating company told me recently that he was told by a Minister—I know that this is all anecdotal, but I hope that my hon. Friend will take it on trust that it is true—that the way to handle the capacity problems that some rail services have is to put up prices. How will that message go down with commuters, particularly those who travel through my constituency on two lines where extra carriages are sorely needed? If they thought that they would have to pay more to use those services, that would give them a grievance.
Mr. McNulty: I accept the point behind my hon. Friend's intervention—price is an important dimension of all aspects of public transport—and that we cannot allow rail services, which are a crucial part of the network, to price themselves out. More often than not, if people are priced off the railways, they do not jump on a bicycle or walk to where they are going; they get in their cars. However, I should make the point in passing that pricing is in the first instance a matter for the train operating companies.
We will bring in new initiatives to make taxis and buses more accessible. Such initiatives are already bearing fruit in some ways and we are making transport safer by cracking down on crime.
As to discount railcards, the Secretary of State has, in response to the fares review, asked the Strategic Rail Authority to work with the industry to develop a national discount railcard. I know that that is another concern of the Way to Go campaign.
In response to the ninth point on the Way to Go list, we are already encouraging motorists to buy smaller, cleaner cars. Vehicle excise duty and the range of taxation and fiscal measures are a matter for the Chancellor of the Exchequer, not for me, and if my hon. Friend wants to pursue that aspect through an Adjournment debate, I am happy for him to do so, as I will not be answering.
Broadly speaking, although I accept that we may need to go further, and we probably will not make sufficient progress on some Way to Go issues, much of what we are already doing through our transport policies, as I have tried to show in the short time available, goes with the grain of the Way to Go campaign.

457WH
Buses are central to our transport strategy. Public transport is central to all that we try to do. Across all modes of transport—roads, rail and buses—we try to make optimum use of existing capacity before even considering any additional capacity. In that way, as we progress over the coming years. the Way to Go campaign and what we are trying to do nationally are at least aligned in terms of direction of travel, if not in every detail.
11.30 am
Sitting suspended until Two o'clock.

Affordable Housing
2 pm
Andrew George: I was delighted to secure the debate this afternoon. In fact, I could not believe my luck. The hon. Member for South Holland and The Deepings (Mr. Hayes) and the Minister may have a sense of déjà vu, because we debated the same subject on 9 December 2003. The hon. Member for Stroud (Mr. Drew) also took part in that debate. One of the reasons that we are here today is that it is a massive issue and affects most of this country. We in the House cannot explore enough the need to find solutions to this most pressing and urgent of problems.
I said that I felt extremely lucky to secure the debate this afternoon, but that was before I realised that the minor matter of the Butler report would be discussed in the main Chamber at the same time, which may have diverted a large number of hon. Members who would otherwise be interested in taking part in this debate. There are important issues to debate and I am delighted that the Minister is here. I told his office about the issues that I intend to cover. They are similar in some ways but different in many others, and develop our debate of eight months ago.
The situation is now so urgent that we need a constraint on the building of new private market homes in the countryside. That may sound perverse, but it is needed to deal with the lack of affordable housing, particularly in the countryside. There is a crying need for the development of an intermediate market between social rented housing and the first rung on the ladder of the private owner-occupying sector. That gulf has been consistently large in many parts of the country, particularly in rural areas, although it oscillates over time. Sadly, it has affected my part of the world for the last generation. We must recognise the need to build a bridge by developing an intermediate market between social rented housing and the first rung of the housing ladder.
I argue strongly that the Government should explore new constraints on the still growing demand for second homes in many areas with severe housing problems. I am not opposed to people who own holiday homes. There are many of them in my area, and despite what others in the Chamber may believe, I am on very good terms with them. Owning second homes and using unused or underused properties for recreational purposes is fine in areas with an excess of housing, but we need seriously to consider ways of constraining the use of such houses purely for recreation and investment in areas with massive local housing demand. Those are the areas about which I am most concerned.
I want to talk about the development of the intermediate market. I also want to engage constructively in the debate, and I hope that that spirit came across the previous time we debated the issue. It is perhaps important to tell the Minister that I shall not be encouraging the many thousands of people in housing need to get involved in a gladiatorial argument about statistics, past records and what the Government have or have not done. I say that because the answers are staring us, as legislators, and the Government, as the controller of the resources, in the face.

459WH
In my contribution, I want to look at the intermediate market, changes to the planning exceptions policy under planning policy guidance note 3, and section 106 obligations under the Town and Country Planning Act 1990. I also want to look at measures to control second home ownership and ask about the Housing Corporation's targets for rural areas and market towns. I then want to ask about the predicted outcome of the investment in social housing that was announced in Monday's spending review and that the Deputy Prime Minister elaborated on further on the Floor of the House yesterday.
I have covered the background to the issue in previous debates, so I shall not go into great detail about the situation in my constituency, which covers Kerrier, Penwith and the Isles of Scilly. As has been well documented, however, it is experiencing severe need because it is at the bottom of the earnings league table but has extremely high house prices. As Members of Parliament, we tend to wear our hearts on our sleeves, drawing attention to the severe problems in our constituencies in an almost macho comparison of scars. Although we may all say that the problem is far worse in our areas than in those of other hon. Members, that will not help to solve the problem. None the less, I assure the Minister that he will find severe housing problems if he looks at areas such as mine. Indeed, the numbers on the local authority waiting list have increased by more than 50 per cent. in the past five years alone.
The problem is illustrated not only by the statistics, but by the human tragedies and the human suffering that those statistics quite properly highlight. It is clear from my constituency work over the past three or four years that the lack of affordable housing is the most significant issue for the majority of people, and I am sure that other hon. Members will have found the same in their casework surgeries, correspondence and public meetings.
Many young couples come to me in severe circumstances. They may be living in winter lets, overcrowded accommodation or one-bedroom flats with two or three children. The local authority is doing its best, and social housing providers and housing associations are trying to manage their resources as best they can, but the fact that many hundreds of families are in such situations brings home to us all just how severe the problem is.
Some people perceive those who live in bedsits, bed-and-breakfast accommodation, overcrowded housing or, as happens in constituencies such as mine, in winter lets such as holiday chalets, as incompetent, dysfunctional, or as belonging to the undeserving poor. I assure hon. Members, however, that those living in such circumstances in my constituency come from hard-working families and were born and brought up there. They do not have criminal records and show no signs of being dysfunctional. They are doing their best, but the facts of life that they face are against them. Despite every effort to improve their situation, they find that it is getting worse, if anything.
Mr. Adrian Sanders: Does my hon. Friend have the same problem in his constituency as I have in mine—a growing gap between wages and average house prices, and a new group of people who need affordable housing because they cannot afford to
460WH
borrow, and whose wages in the same occupations 20 or 30 years ago would have meant that they could afford to buy? The affordability gap has increased homelessness among working people.
Andrew George: That is true. I am grateful to my hon. Friend for mentioning that. I notice from the Joseph Rowntree Foundation findings on affordability differences for working households wanting to buy homes that Torbay comes 20th on the list of authorities with the highest house price to income ratios. Many areas in my part of the world are high on the list, too.
In the families that I am talking about, the main or second income earner—it is not unusual for there to be two—may be a nurse, a member of the fire service or, as in one recent case, a teacher. One would normally expect those professions to provide for their members a settled existence in the community and a sound foundation from which to go to work with some security.
Mr. John Hayes: I shall speak later, so I do not want to take up too much of the hon. Gentleman's time. Does not the intervention by the hon. Member for Torbay (Mr. Sanders) highlight the fact that affordability is about people, not buildings? Houses become more or less affordable according to market change, so it is necessary to focus on helping people to afford the available housing stock—not merely to assume that it is possible to build "affordable houses", because they may quickly become unaffordable.
Andrew George: I am grateful for that intervention. I entirely agree. As I said earlier, we cannot simply build ourselves out of the present housing crisis. However, I did not sufficiently explain one point. The affordability gap has been significant for the past 25 years in areas such as my constituency, which has consistently been at the bottom of the earnings league table, but where house prices have always been buoyed by people equity stripping from the south-east, buying second homes and so on. It is just that a gap sometimes becomes a gulf, which is what it is at the moment.
Of course, there are oscillations in the market. Even when there is negative equity, the affordability gap remains for many families. It is not something that goes in cycles and will vanish in a few years when the market rights itself. My prediction is that in areas such as mine the market will never come right. There will always be a significant affordability gap. Therefore, we need to find constructive, creative ways to resolve the problem.
The Countryside Agency's report entitled, "The state of the countryside 2004", published at the end of June, identified a 30 per cent. increase in homelessness in remote rural areas in the past two years. I am sure that the Government have taken that on board.
Hywel Williams: I apologise for not being able to stay for the debate, much as I want to participate, as I have a Committee meeting.
Does the hon. Gentleman agree that there is a great deal of market failure in many respects? In my constituency, for example, there are communities where more than 50 per cent. of the homes are second homes. Anyone on an average wage locally will be pushed out

461WH
of the market. There is nothing whatever that those people can do. On his point about homelessness, is not a large amount of rural homelessness masked by out-migration?
Andrew George: I entirely agree. In certain circumstances, even where there are jobs locally for a local young person or family, housing pressures become so great that those people are forced to leave—they do so because of lack of housing, not lack of jobs. In the far west of Cornwall and the Isles of Scilly, which are particularly remote, it is difficult to make that decision, whereas in areas that are closer to urban centres, that decision can be made relatively easily because the family or person can still keep in touch with the local community from which they come. However, I accept the hon. Gentleman's point.
I want to mention the development of the intermediate market. I use that expression, as do some others, and I hope that it will gain common currency and that the Government recognise that there is a policy area that is presently largely filled with a vacuum. I am talking about the gap between rented—mainly social rented—housing and the first rung on the housing ladder in the private sector. Primarily, when people think of filling that gap, they think of shared equity developments, which is fine as an approach. I agree that, primarily, an intermediate market means shared equity properties or long-term leasehold properties.
A problem emerges when people are encouraged to create demand in that market, but there is a lack of available properties for them. Another problem, if people are able to get a shared equity property, is what to do after they have purchased that property if they want to move on. Often, people find themselves locked into a shared equity situation. They are unable to make the further step on to the first rung of the housing ladder because there has been no significant increase in their income, and they have not had the benefit of money from a legacy, or won the lottery. Where do those people go? There are so few options for them.
The development of sufficient property in the shared equity sector—the intermediate market—is required, so that it will have a life of its own. That will need a positive policy initiative from the Government. I appreciate the need to avoid, in any shared equity development, the situation in which an occupier can staircase ownership up to 100 per cent., so that the property cannot be used for local need. It is also important that such schemes ultimately have a housing association or other similar manager to provide long-term management. Investment and a concerted effort on the part of the Government are needed.
On 10 May, I had a debate with the Economic Secretary to the Treasury in the main Chamber on self-invested personal pensions. The hon. Member for Ceredigion (Mr. Thomas), who knows a great deal about the issue, and I had a meeting with the Financial Secretary to the Treasury last week to discuss the potential negative impacts of the misuse of self-invested personal pensions, which we fear may allow those who use the scheme to purchase second homes. There is potential for a virtuous circle to be achieved here. There may be a problem with the many people who have spare
462WH
income to invest in private pension arrangements, and who use a self-invested personal pension, because from 2006 they will be eligible to invest their pension in residential property. If that were clearly restricted to portfolios of shared equity accommodation with housing associations or the public or private rented sector, the pension investor would get the benefit of investing in the relatively stable and growing value of the property market over time, there would be a beneficial social outcome and the available housing stock would increase for people who need affordable housing.
I urge the Minister to talk to his Treasury colleagues about ensuring that self-invested personal pensions are not misused to buy second holiday homes, but are used for good and virtuous purposes. That will take a concerted effort and a little joined-up government, with which I am sure the Minister would want to associate himself.
Another area that is currently being developed, which was mentioned to me by the co-operative movement, is the possibility of establishing mutual home ownership. I am told that mutual home ownership is a model based on two core structural elements: a community land trust to hold the land outside the market, and a shared equity housing co-operative to reduce the management costs and to ensure accountability. It is argued that the main advantages of that model are that, unlike shared ownership, any public subsidy is locked in and preserved for future generations.
The proposed structure gives residents access to lower mortgage rates as an individual owner-occupier, because it is part of a wider investment plan. The monthly payments are flexible and based on an affordable percentage of a key worker's income. There are a number of advantages to the scheme. I say to the Minister that the mutual home ownership approach is worth looking at along with other approaches such as the shared equity system.
I want to consider the planning exceptions policy. Before I was elected in 1997, I was involved in the charitable sector, working with parish councils and local authorities, to establish local housing need working parties to identify land and housing associations, and to work with the local authority to stitch together developments of 10—possibly more, possibly fewer—houses using the exceptions policy, after PPG3 was introduced in the early 1990s. At that stage, there was a lot of enthusiasm about recognising the distinction regarding market housing on the edge of villages and, I argue, towns as well, and recognising the problems of sticking strictly to planning policies and not demonstrating flexibility, which rolls over into hope values on land. Landowners were prepared to countenance the idea of making land available at significantly lower than market rates in order to meet a need that is held in perpetuity. I urge the Minister to look carefully at the way in which the policy is being rolled out.
The Minister for Housing and Planning made a written statement on 17 June this year regarding that policy, but he did not make it clear whether the Government will ensure that exception sites will be allocated, or allow them to be identified through a development process. I urge the Minister to consider the

463WH
issue carefully because as soon as one starts allocating exception sites one, first, increases their value and, secondly, restricts other options.
When I was involved in the working parties, there were occasions when the landowner said, "I want to hold out for more money." Because the working party held the mechanism to deliver housing to meet local need, we were able to say, "If you're not prepared to negotiate on the price, we'll look at another site". That usually brought the landowner back to the negotiating table.
It is important that we ensure that the exceptions approach is expanded still further. As I have said, we cannot resolve the crisis simply by building so many thousands of houses that it brings market prices down. That is unrealistic. In fact the private sector has enough land in planning permission to build 250,000 houses tomorrow. The problem is the phasing and development.
Last week, a local newspaper the Helston Packet had as its front-page headline—it is a big issue—"Priced-out". Its report states that estate agents were confirming the findings of an official report by the National Housing Federation that said that homes in the south-west were unaffordable. One branch manager, Stephan Kent of Miller Countrywide estate agents, is quoted as saying:
"The only way, really, you could solve the situation is having councils saying houses can only be sold to local people.
There really is no other solution unless the market comes down."
That recognises that something needs to be done. Something dramatic needs to happen to ensure that exception sites can be brought forward.
That involves much more robust planning policies. In my view, those need to be more draconian to stop general unfettered planning permissions in the countryside and to provide a fertile ground on which exceptions developments can go forward. For example, in Penwith district, only one exception site has been brought forward in the past five years and that was on council land. We need the support of Government to create the fertile ground on which such development can take place.
I do not want to go on much longer but I emphasise to the Minister the issue of second home ownership, which I have raised before. I understand that the Welsh Assembly has considered the issue of altering the Town and Country Planning (Use Classes) Order 1987, so that planning permission would be required to change a property from a permanent residency to a recreational, holiday or non-permanent residency. It consulted a large number of academics, who said that that would be unworkable because it is difficult to define what is a second home and what it is not.
I urge the Minister to consider the issue more carefully. It was possible to define what a second home was when it was in the interests of second home owners to receive a 50 per cent. discount in council tax. As it was possible in those circumstances, I urge the Minister to consider the issue closely to see whether there are ways in which such constraints could be brought forward. In the past, the Housing Corporation set targets to meet needs in more remote and smaller rural communities.
464WH
There is concern about the matter. In its annual report to Government last week, the Countryside Agency warned that the Office of the Deputy Prime Minister's plans to scrap national targets for the provision of low-cost housing for local people in settlements of fewer than 3,000 people—and to hand responsibility to the regional housing boards—will result in fewer social housing units being developed in rural areas.
When it comes to meeting future targets, the impact of the spending review and the annual 4.1 per cent. increase in investment in social housing, I am concerned that, in respect of registered social landlord and council developments of social housing since 1996, the number of completions has almost halved—from 38,000 in 1995–96 to 19,000 in 2002–03. The investment available from the Government is one thing, but completions appear to be quite another.
I know that I have taken up quite a bit of time but, as not many hon. Members are present, I have perhaps taken more liberties than I should. I apologise to you, Mr. Olner, and to other hon. Members for doing so. I wanted to set out the importance of the issue clearly, as well as establishing a constructive cross-party consensus to try to find new ways to bridge the affordability gap.
2.31 pm
Mr. David Drew: I am delighted to reprise a debate that we seem to have every six months, but I hope that we can move it forward today, as there have been some important developments since we last had the opportunity for debate, either in this forum or in others. I know that some of us are regular offenders when it comes to taking part in such debates, but either we are a bit slow in getting our message across, or we feel that it is such an important message that we must keep reiterating it. I hope the latter is the case.
I welcome what the hon. Member for St. Ives (Andrew George) has said. I disagree with no detail of his explanation of the rural context. I make no apology for speaking largely about rural Britain, because the urban dimension is regularly raised in other quarters.
Three developments since we last had a similar debate are worthy of note. The first happened yesterday. It would be churlish not to recognise that the OPDM has done well out of the comprehensive spending review—assuming that the review will turn into real money at some point. It was a good announcement, and housing was obviously the major beneficiary: £1.3 billion by 2008 is a significant investment. However, we all know that we have to go further and lock in private sector funds.
The second development is the changes in the planning system. Like so many developments trailed by any Government, the impact of the changes is more immediate in theory than it is in reality. I hope that the changes will be implemented sensitively in rural areas—no one wants untrammelled development. I retain my membership of the Campaign to Protect Rural England, but sometimes argue with the organisation about the way in which some of its messages are—at best—misconstrued. The CPRE must avoid being perceived as a taking a no-development-in-any-circumstances approach. The focus should be on having the right development, carried out in the right way, with appropriate housing numbers.

465WH
The third development, which is not to be underestimated, is the Miles report, which considered some of the macro-underpinning of the housing market. Although we are considering only part of that market, it is an important part. If people are starved out of the market, it is not effective—there is market failure. The inbuilt pressure of excess demand inevitably increases prices, which prevents more people from entering the housing market.
The hon. Gentleman did not blind us with a lot of statistics, as has happened in previous debates, and I do not intend to examine the figures for what has happened over the past few years, either. Anyone who has a rural or semi-rural constituency will know one clear piece of anecdotal evidence: development has not taken place in recent years, especially in villages; and many developments in market towns have not been able to bridge the affordability gap. We have a specific problem with our ability to deliver social housing. My right hon. Friend the Deputy Prime Minister talked yesterday about gap funding, and on a very different level we may need to consider that in a rural dimension. I take it that the Department will be working on it, and no doubt my hon. Friend the Minister will say a few words on the subject when he responds.
I shall concentrate on three rural housing issues, coming in directly where the hon. Gentleman left off with exceptions policy, although I will be even more blunt than him. Baroness Dean of Thornton-le-Fylde asked some of us whether it was suitable or appropriate to try to change exceptions policy. The overwhelming message from rural Labour MPs was to leave it alone. The figure should not be raised beyond 3,000, because, if it were, the emphasis would immediately be put more on market towns than on small communities. There was even an argument for reducing the threshold, but we did not get into that. I hope that the Government are not wobbling and getting the idea that the figure is irrelevant or that a different approach is possible. The only other approach is to use section 106 agreements, and anyone who has had dealings with local authorities—love them though we do—will know that they are often seriously underpowered in that respect. Developers are too often able to twist and turn and exploit the lack of expertise, so that what is supposed to be delivered ends up not being delivered. That is no way to give any community confidence in that way of proceeding.
Andrew George: I do not disagree with the hon. Gentleman, but were he and his fellow Labour MPs confusing the Housing Corporation targets, which over the years have included developments of social housing for communities with fewer than 3,000 people, with exceptions policies, which are about developments on the edges of settlements that could involve a range of communities of various sizes? Is he talking about the allocation of public funds or the imposition of planning policy?
Mr. Drew: They work together. That is the whole point. My old friend Moira Constable from the Rural Housing Trust has told me on more occasions than I care to remember that, in reality, there are three sides to the problem. There is the problem of land, but people
466WH
are adamant that they can find altruistic landowners to provide land. Planning permission is more of a problem, but that is why exceptions policy is so important. An interested parish council or organisation working off a parish council—usually the main drivers—will almost certainly find a way of using the policy. Because the development almost certainly falls outside the village envelope, they usually find a way to persuade people that the development falls within the exceptions policy criteria, and it is moved forward. The third problem is money. One can have the land and the permission, but one needs the money from the Housing Corporation. The biggest single problem with that is the fact that the sites involved are small, perhaps consisting of only three or four houses; they go into the pot against larger developments and sometimes lose out because they cannot offer economies of scale.
Let us leave things as they are, but improve the process. Let us give parish councils and local communities the wherewithal to feel confident. The biggest problem is the time involved. In the case of one village in my constituency, Nympsfield, it took a decade of attrition to get from wanting a small number of affordable houses, some of which would be social housing, to completion. It took so long despite helpful support from Gloucestershire rural community council, which takes an active interest in the area. The process takes a long time and we need to cut that down.
There is another problem that needs to be solved. I am usually a great believer in regional strategy and identity, but regional housing boards must recognise that, as well as establishing the strategic overview, they must work at a much lower level—dare I say, the first level—of communities: villages. Regional housing boards must include rural housing people who really understand what needs to be done in terms of the process of attrition, the cleverness that always has to be brought into any system, and the sheer guts that are needed to stand up to the developers, who often come back with something that is not necessarily what the community wants.
I hope that the Minister will consider the matter. I am sure that he will net give us an instant reply, because I know that the discussions are ongoing, but there is a clear understanding among rural MPs in general, and Labour ones in particular, that we do not want the policy monkeyed with. It is working. It could work better, but the alternatives are far worse.
The next issue is what I call the structure of rural housing—who is there and who is not. We know who is coming into the rural housing market: increasingly, it is people with money. When I met Shelter recently, it described the drift that is taking place, largely from the south-east to the south-west—I make no apology for concentrating on the south-west. That drift puts enormous pressure on house prices, particularly for the sort of house that a first-time buyer wants to move into, but that someone else might regard as an ideal second house—they might ultimately want to move to the south-west, but initially they regard the property as an investment and something that they can use at weekends. In the meantime, they might rent it out, which keeps the unit of accommodation accessible to someone of lesser means for a time, but at some point it will be lost. We must understand the structural implications.

467WH
Labour does not sell off housing association properties—there is a marked difference between the main Opposition and us in that respect. Going along the route that they propose would be the death of any form of social housing in rural economies. However, I feel strongly that we have made a huge mistake in terms of the number of council properties that have been lost. I know that I disagree with Ministers on that—I shall not reiterate the arguments about keeping the fourth option open—but social housing in rural areas is even more important than in large urban council estates, because even now there are still some units of accommodation left and it is important to keep them in a price bracket that makes them available to families who are never going to be able to buy at the current rate. That is important whether one calls it social engineering or social justice.
We can look at the issue in different ways—I will come on to my proposal in a minute—but we must not confuse affordable housing with social housing. Some people concentrate wholly on social housing, and we must fight that corner, whether we are talking about housing for agricultural labourers or housing that is tied to a particular job, or housing in some parts of the south-east and the south-west for people who would not be able to do social care work, or even work in the public sector, if they did not have access to that type of housing.
That takes me on to my final point, which was well rehearsed by the hon. Member for St. Ives—I said "hear, hear" plenty of times. My solution to many of the problems, which is still in its infancy, involves community land trusts as a way to control the land. If we lose control of the land, a whole section of the population is shut out. Retaining ownership of the land while giving people an equity stake—that is where the mutual prospects come in—would be music to my ears and those of my hon. Friend the Minister, who is a fellow co-operator. That is not just a theory or a wonderful idea that might be tried in a couple of decades. In many parts of the world, community land trusts and mutual house ownership give people an equity stake that increases so that, ultimately, they can buy for themselves—they are not prevented from taking advantage of the opportunity to do so—but the important thing is that they cannot take the unit with them. I hope that the Government will give the idea serious consideration.
If my hon. Friend the Minister has been briefed properly, he will know that I have already got my greedy little fingers all over one of the sites that has moved from the Department of Health to the Office of the Deputy Prime Minister and said that it would be a wonderful location for a pilot. Although I have a vested interest in my hon. Friend examining what can be done in the Strouds of this world as well as in the Londons, he does not have to say anything today and do not mind where it is done. This is a real opportunity that should be grasped now, given the fact that there is good will behind it and additional investment.
We had an excellent meeting in my constituency last Thursday with David Rodgers of CDS Co-operatives, who is well known to my hon. Friend the Minister. Mr. Rodgers was well received by 100 people, to whom he sold the idea that the proposal that I have outlined could begin to break the back of the affordable housing
468WH
problem. A report commissioned by CDS from the New Economics Foundation goes into considerable detail about how it could work. We just need to take it up and get pilot projects under way to discover how it could be introduced across the country.
Community land trusts are not the only answer, but there are solutions to the problem, and we must consider them. What is happening now is not in any way acceptable, let alone sustainable. We talk about sustainable communities, but it will not help if urban centres become more sustainable while rural communities become even less sustainable—if they become commuting settlements or areas in which only those with means are able to live.
I hope that my hon. Friend the Minister has heard my plea. He will get nothing but support from me, because I believe that we must all pull together—I hope that the issue does not divide the parties. There were many Conservatives in the audience last week, and they were keen to hear about the proposal. We must begin to break the back of this problem. Many people think that politicians have let them down and that the issue has slid past us. It seems so difficult, and we ask, "What can we do?" Well, there are things that can be done, and I hope that with support from all quarters my hon. Friend will be there to make sure that they are done.
2.48 pm
Mr. Adrian Sanders: I congratulate my hon. Friend the Member for St. Ives (Andrew George) on securing this debate and on dealing with issues that are pertinent to most constituencies in south-west England and beyond.
The intermediate housing market requires attention. It is clear that we have suffered from a two-dimensional housing market in which one either rents or buys. However, in an intermediate market, one can go from renting to part-purchase to purchase. That gap in the market is short. My hon. Friend mentioned the affordability gap—not a new phenomenon but one that has certainly become worse in the past 15 to 20 years. As I said in my intervention, a new group of people are looking for affordable accommodation—people whose incomes would in the past have enabled them to borrow and get on the first step of the property ladder.
My hon. Friend also mentioned the problem of second homes. People with equity who move in from outside not only inflate house prices with their bids, but are often in a position to move faster to secure a sale than people in the local area. My hon. Friend also mentioned self-invested personal pension schemes and the impact that they might have in future, which is certainly a concern.
On PPG 3 and local housing need strategies, if a local authority was tasked with developing a local housing needs strategy and left to conduct an authoritative study of what was needed in the area, it would probably come up with a very different picture than simply an outline showing the total number of units required, which is how things are done now. A local approach is more likely to produce appropriate housing. That point is important in bringing quality to the planning system and in developing communities.
My hon. Friend called for tougher planning rules to assist the provision of affordable housing. The hon. Member for Stroud (Mr. Drew) echoed that call and

469WH
made a good point about section 106 agreements. There is expertise within local authorities to negotiate such agreements, but that expertise is not the same in every local authority. There is no doubt that some developers can get a better deal out of one local authority than another. Perhaps some work should be done to ensure that the skills and powers in local government are equal, so that no authority can be picked off.
The hon. Gentleman also mentioned migration from the south-east to the south-west, which is quite well documented. Surveys of people's expectations suggest that there will be no downturn in the number of people desiring to move to the south-west from the south-east. He also mentioned community land trusts—an idea whose time has come, particularly in small rural communities, but in urban areas and cities as well. He was right to say that no one has the answer to the problem of affordable housing, but there are solutions. I should like to talk about some solutions that the Liberal Democrats advocate, and add to those that have already been mentioned.
On the scale of the problem, about 175,000 houses were built in the United Kingdom in 2001—the lowest level since the second world war—and 12.5 per cent. fewer new houses were built in the last 10 years than in the preceding decade. Over the past 30 years, UK house prices have increased by 2.4 per cent. a year in real terms, compared with the EU average of 1.1 per cent.—the figures were 0 per cent. in Germany and 0.8 per cent. in France. The latest evidence suggests that the trend rate of house price growth in the UK has increased to 2.7 per cent. in the last 20 years.
Following the spending review and the Barker review, the Office of the Deputy Prime Minister's housing budget will be £1.3 billion higher in 2007–08 than in 2004–05, which is equivalent to an annual average growth rate of 4.1 per cent. in real terms. That is marvellous news—I do not think that anyone has said, "We're against this"—but, according to the Government's figures, the increase will provide funding for only 10,000 new social housing units a year by 2007„08. The Barker review says that we in fact need between £1.2 billion and £1.6 billion for social housing alone, and 17,000 to 23,000 more houses each year.
My local authority conducted a housing needs survey and brought in outside consultants, who concluded that my authority alone needed 2,000 units of affordable accommodation. I often look at national statistics and try to work out what they mean for my area, so I did a quick calculation based on that figure. The population of my area is 0.2 per cent. of the UK population, so the 2,000 properties needed in my constituency is equivalent to close on 1 million properties across the UK, yet the Barker review says that only 23,000 are needed. Either the Barker review has massively underestimated the likely need for housing, or the situation in my constituency is worse than a crisis. Perhaps it is a bit of both. The Barker review states that
"additional investment building up to £1.2 to £1.6 billion per annum"
will be required to deliver additional social housing to meet projected future needs. The spending review is therefore a start, not an end, to meeting the need for more affordable housing.
470WH
The Liberal Democrat view is that we can do better, that empty homes should be brought back into use and creative planning should be used to build more affordable homes. Between 1991 and 2001, growth in housing demand outstripped supply by more than 400,000 households Based on current trends, a housing shortfall of 1.5 million within 20 years is predicted. In human terms, that means overcrowding at best, and more homelessness at worst. Britain now has the highest ever number of households in temporary accommodation, and Shelter reckons that 1 million households are already inadequately housed. House prices and rents are so high in some areas that employers in schools, hospitals and across the economy simply cannot afford to recruit staff locally. That will not get any easier when graduates come out of university with big debts: areas with high house prices will have difficulty in attracting graduates, because they will want to go where the highest salaries are so that they can pay back their debts with minimum outlay on housing costs. That will have a profound effect across the board in the far south-west, where the affordability gap between what the local economy can offer in salaries and how much it costs to house oneself is greatest. That will affect not only the private sector, but local government and other public services.
There is a rather obvious reason for the problem: for the past 30 years, we have been building fewer homes. Annual house building has plummeted to levels not seen since the 1920s. The Government have acted, but, sadly, they also cut the social housing grant, which meant that affordable housing schemes across the country had to be curtailed and projects that had been several years in the making had the rug pulled from under them. The Liberal Democrats want to know why the tens of thousands of empty properties across the country are not being reused. There have been some pilot schemes, but nationwide action is needed. There should be some consideration of homes that are left empty because their owners lack the cash to repair them, or because the absentee landlord cannot be bothered with them, or because their ageing owners have not been offered help and advice about renting them out. Empty homes present an opportunity, and we need to do more to bring them back into the market. If we want to boost the number of affordable homes quickly, it makes more sense to use existing homes than to build new ones, as it must be cheaper and faster to repair empty housing stock.
To do that, we need to trust and empower housing authorities more than we currently do, which means providing best-practice cash and legal powers to act. The Liberal Democrats believe that the first steps should be voluntary changes such as the use of grants and advice to try to persuade owners to let their property; brokering relations between owners and letting agents; proposing appropriate tenants; and delivering faster on housing benefits, which can often act as a disincentive to people to rent out. However, all that needs back-stop powers. There should be a power to act where owners leave homes empty for no good reason, which is why we have long advocated empty property management orders giving councils the power to take over the management of the property for a limited period, and compelling them to lease it. I am pleased that the Government are taking that up. The use of empty homes should have been part of the sustainable communities

471WH
plan. That aimed to be environmentally friendly, and in many ways it is, but there is a glaring error in relation to empty homes.
We all know that it is difficult to find extra housing resources, so one of our proposals is for a right to invest, which has been referred to by other hon. Members. That would make the old notion of shared equity far more flexible, by allowing council and housing association tenants the right to build up stakes in their homes. We think of it as a development of right to buy in which the home does not leave the social housing sector. Under right to invest, tenants share in the rising value of the social landlord's property, so rocketing house prices do not prevent them from moving out of social homes if they want to do so. The concept is not new; it just involves tweaking the planning rules so that planning consents place limited restrictions on future sales of new affordable homes.
We are also keen for the Government to investigate the idea of land value taxation, which would bring land that is banked by landlords into use. The evidence of greater Government effort is there, but the report of the Select Committee on the Office of the Deputy Prime Minister on the Housing Corporation concluded that housing policy has become a quagmire of quangos. That needs to be addressed. We must make it simpler to invest in housing. Finally, the message from the ventures is that we need more affordable homes because the scale of the problem is so great. We want more local decision making, a review of the planning system and policies that match the problems that are experienced in our communities.
3.2 pm
Mr. John Hayes: I refer hon. Members and others to my entry in the Register of Members' Interests.
I congratulate the hon. Member for St. Ives (Andrew George), who always speaks with charm and expertise about his locality, expertise that wavers a little when he moves outside it, but he is certainly well informed and passionate in his advocacy of local interests. It is entirely appropriate that the tone of the debate has been largely non-partisan. As several hon. Members have said, many of these issues extend well beyond the normal party divide or knockabout.
We have a major problem with housing affordability in the south-west and elsewhere; there are few areas in which it is not a problem. Although there are pockets where this does not apply, most places experience an affordability problem of some kind. In my part of the country—a rural constituency in a rural county—young people, first-time buyers and other local people who want to get on the housing ladder all experience difficulties because house prices have risen sharply.
There is a great deal of empirical evidence to support that assertion. The Halifax price index shows that the price index ratio increased from 3.19 in 1997 to 4.78 in 2003, and the Halifax annual first-time buyer review suggests that eight out of 10 towns in the UK were unaffordable for the majority of those buying their first home during 2003.
The hon. Gentleman referred to the Joseph Rowntree Foundation report, which found that the ratio of house price to household income for working households aged
472WH
between 20 and 39 exceeded five to one in 33 local authority areas in England, and that in 19 local authority areas fewer than one in five such households could afford even the lowest quartile of house prices.
The results of the affordability problem have been manifold. One of the most notable and socially significant is that people are buying houses later in life; they are finding other ways to accommodate themselves. More young people, including young married couples with children, are unable to get on the housing ladder and are therefore obliged to live with their parents. It happens in my constituency, and I am sure that it happens also in the Minister's constituency and those of other hon. Members. Couples are having to live with parents, or other members of the family because they cannot get on the housing ladder.
However, this is not principally a problem of housing supply, although that is a problem in some parts of the country. We certainly need to build houses—we always have and we always will. Houses of the right kind, built in the right places, will add to the quality of the built environment, be in sympathy with the landscape and deliver high-quality residences for those who buy them, but, although supply is important, the question of affordability is principally about people. I justify that conclusion on three grounds.
We have already spent a little time debating the first; it is clear that as house prices change so does affordability. Affordability is about people's ability to afford what is available. With volatility of the sort that we have seen in the housing market over recent years, houses that were affordable one year become unaffordable the next—for the same group of people doing the same kind of job and with the same social status and the same income. That is exactly the point made by the hon. Member for St. Ives when he introduced the debate.
Secondly, the result of the massive growth in second home ownership and the buy-to-let market is that available houses have been bought not by first-time buyers, key workers or those who in the past would have been able to buy them, but by people who consider them principally either as an investment or as places to be used for recreational purposes. That does not suggest a supply problem. The houses are there, but they are not being bought by the people who once would have purchased them—people who are rooted in the local community. Often, for the reasons I mentioned, they are bought by people from outside the community.
Thirdly, there seems to be an imprecise relationship between house prices, and therefore affordability, and supply. Only 10 per cent. of housing transactions involve new housing stock, and only 1 per cent. of total housing stock is new. Due to the typical delays involved when supply is increased, a massive number of houses would need to be built to affect price through supply-side means. Most factors that affect house prices, and therefore affordability, are demand-side factors. They include the level of interest rates, the attractiveness or relative unattractiveness of alternative investment vehicles, the level of borrowing secured by housing equity and the disproportionate allure of home ownership in English culture.
To assume that one can counteract those factors by changing the volume of supply is at best naive and at worst a hopelessly misplaced adventure. None the less,

473WH
the Government may embark on that adventure if they follow the recommendations of the Barker report. Despite the fact that Kate Barker is a distinguished and much respected economist, she seems to have disregarded the macro-economic arguments that I have listed. She seems to assume that one can significantly affect house price inflation and volatility by making a massive change in supply.
I hope that the Government will be much more imaginative than that. We have to consider a range of means by which people can be helped to afford available housing. Before that, however, I want to deal briefly with two or three points made by others.
The hon. Member for Stroud (Mr. Drew) spoke with great passion and knowledge about the exception site policy. It is an important means, in rural areas such as those represented by me and the hon. Member for St. Ives, of adding to the housing stock incrementally—with sensitivity to local wishes and in keeping with the local built environment and landscape—to provide housing for local people. But the exception site policy should not be used as a means to ride roughshod over the proper planning process. That policy is not about building 100 houses in a settlement irrespective of who will buy them, what they look and feel like, and their impact on local infrastructure. It is an incremental means to add to a settlement and to provide low-cost and social housing for local people. That has my full support, as I have said in the House previously.
The hon. Member for Stroud is right in that we need to look at ways that we can provide extra support. I hope the Minister deals with that. There are strong arguments for examining how we can build on the exception site policy, because there is hardly a village in Britain that could not accommodate a small number of extra houses to provide opportunities for local young people and first-time buyers, and this policy provides a good means of doing that.
The hon. Member for Torbay (Mr. Sanders) referred to social housing and was right to say that, notwithstanding the Deputy Prime Minister's announcement yesterday, social house building has virtually petered out. There were between 35,000 and 40,000 social housing completions in most years under the last Conservative Government, but that figure has fallen to fewer than 20,000 under Labour. Even with the extra 10,000 a year mentioned by the Deputy Prime Minister yesterday, we are 10,000 a year behind the record of the last Tory Government.
There are key issues involving social house building and whether we are getting, in the words of the Minister for Housing and Planning, sufficient bang for our bucks. Are the current means for providing social housing and the mechanisms for delivering a return on investment the most effective? We did not hear much about that from the Deputy Prime Minister yesterday. There may be an issue as to how effectively the Housing Corporation is delivering bang for bucks—those words are not mine, but those of the Minister for Housing and Planning—and there may be issues about how we can
474WH
help housing associations to work more effectively with the private sector to deliver more social housing where it is needed.
Andrew George rose—
Mr. Hayes: I shall give way briefly, because I am anxious to give the Minister maximum time to reply.
Andrew George: I agree that the hon. Gentleman should give the Minister the maximum, so I shall be brief. I accept that the Labour Government seem to be putting more money in, but they seem to be getting less housing out. The crucial factor is the price of available land, which requires the Government to establish robust policies to distinguish between unfettered permission for market housing and social and affordable housing.
Mr. Hayes: The hon. Gentleman makes a good point; it may also involve how land availability can be re-examined. I refer him, in particular, to the designation of brownfield land. I recently completed a study on that and found that the proportion of brownfield land designated for commercial and industrial development is greater than that designated for residential growth. In terms of take-up, the Government have had some success; they have met their target for brownfield land, although whether it was high enough may be debatable. That is a cheap and easy point, which I should not make because I am neither.
There is an argument that some redesignation of brownfield land in urban and rural areas would have a significant effect on the available land for development. While one would need to consider the cost of development in those cases—there are associated fiscal and regulation issues—it would provide an opportunity for the development of land that is lying idle. There is hardly a town in this country that does not have a derelict former industrial or commercial site that has remained so for a considerable period and that could be used more productively for residential development.
We are not saying that we do not want to build anything anywhere, but that we want to build the right houses in the right places—houses appropriate to local needs and in line with local wishes. We also want to make available housing that suits local demand, so we are indeed talking about social and affordable housing.
My final point is about changing our view of affordability. We need to change from a building-centred view to a people-centred view. We need an equity revolution—to give serious consideration to shared equity, as several hon. Members have said. We need a multiplicity of schemes that will allow people to get on to the housing ladder at different levels and to staircase up their acquisition of equity over time. Most people can afford more as they become more prosperous. Ironically, however, mortgages do not work like that. They are very hard to pay right at the beginning, but as one becomes older and richer—well, some do; I live in hope—the mortgage becomes easier to pay and so we need to consider ways to adjust that kind of arrangement. In essence, shared equity can provide a means to bring into the housing market people who are excluded from it.
In conclusion, I draw the Minister's attention to the study by Glen Bramley of Heriot-Watt university, who estimates that if shared ownership was widely available,

475WH
it would help an additional 12 to 15 per cent. of householders in the south of England, including the south-west, to buy.
We have a problem that requires imagination and lateral thinking. It is not a party political problem, but the Government are the ones with the power to do something about it. If we fail, we fail aspirant home owners; we fail the future.
3.16 pm
The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister: I congratulate the hon. Member for St. Ives (Andrew George) on securing the debate and on bringing this important issue to the attention of the Chamber again. If we do this every six months, we can call it a biannual review and develop policy in that way. We have had a high-quality debate, although there may have been few people in the Chamber, for reasons to which he alluded. The quality of hon. Members' contributions has been excellent. We will take away many of the comments in the spirit in which they were made, which is how we solve the problems that we face.
I make it clear, and I am sure that there is no doubt, that the Government are committed to increasing the overall supply of housing in areas with significant housing shortages. I shall return to the core point made by the hon. Member for South Holland and The Deepings (Mr. Hayes) about being people-centred rather than building-centred. Whatever that argument may be, there is no doubt that we must increase the supply of housing in areas with significant housing shortages. The provision of sufficiently good-quality housing is an essential requirement if we are to have thriving and sustainable communities.
Tackling housing shortages, homelessness and the problems associated with housing in poor condition, which we have not touched on today, as well as low demand and abandonment, which are totally different problems that affect certain parts of the north, is a key part of our strategy to tackle social exclusion and to make real changes to the quality of life in our most deprived communities. Cramped housing and housing in poor condition have an impact on people's well-being, their general health and their children's educational attainment. There is a raft of problems, with which we are trying to deal. Problems with the supply of housing affect the economy as well as people, a point that was made earlier.
Several hon. Members, including my hon. Friend the Member for Stroud (Mr. Drew), mentioned the strategic spending review announcement yesterday. I shall place on record what was announced, so that we have a context. There will be an extra 10,000 social rented homes a year by 2007–08—an increase of 50 per cent. on previous figures—delivered as a result of a 22 per cent. increase in investment, coupled with significant efficiencies, to which the hon. Member for South Holland and The Deepings referred We intend that real investment to turn around the growth in homelessness by 2008.
We are acting to increase the housing supply and to help to improve affordability in high-demand regions through the communities plan, which will deliver some 200,000 additional homes in the growth areas of
476WH
London and the south-east. We are also responding to new proposals for sustainable growth where there is demand locally. Yesterday, we announced a new £200 million community infrastructure fund, responding in particular to the Barker report recommendations on providing transport infrastructure to support the development of new sustainable communities. Often, transport can be the key to unlocking sites and regeneration.
Although this has not been a focus of the debate, we are also improving the economic development of the north of England to deal with the issue of the growth gap between the regions. We are dealing with low housing demand by trebling the pathfinder programme to £450 million, with a new scheme to deal with low demand—the opposite of the affordability issue that we have been debating this afternoon. We are also reducing the number of non-decent social rented homes by 1.6 million between 1997 and 2008, giving sustained progress to our target of having 2.1 million decent homes by 2010.
In these debates, the time available to tackle the raft of issues and concerns raised is never enough. There is no quick and easy way of tackling the complexity of the problems and issues raised this afternoon. However, we are now putting in place all the building blocks—if I may use that phrase—to get this matter right. First and foremost is the question of resources. Although public funding is inevitably limited and difficult choices have to be made, it is clear from yesterday's announcement that we attach huge importance to the need to improve our work on housing. Some £4.5 billion has been allocated for mainstream housing investment in 2007–08, which is about three times the amount made available in 1997–98.
I do not want to get into point scoring here, and we have done pretty well in that regard so far, but I have to say that the previous Conservative Government halved funding for housing investment in the five years up to 1997–98. When the hon. Member for South Holland and The Deepings was speaking about how he wanted to be person-centred, not building-centred, I wondered whether that meant that he could not say today whether his party would match the investment that we announced yesterday for housing. I am happy to take interventions from the hon. Gentleman or from the hon. Member for St. Ives on whether they would commit themselves at this stage to matching the investment in new house and home building over the period of the strategic spending review. It seems that no one is going to intervene, so I shall take that as a no.
I make that point because the hon. Member for St. Ives made an impassioned speech, but did not give the statistics. He talked about the personal impact on individuals, families and people growing up in rural areas of not being able to afford to buy a house. He was absolutely right to describe that in those personal terms, but the Government have to match personal experiences with effective spend. and put the resources in place. That is why I put down that small challenge as to whether we could rely on a Liberal Democrat Government—God forbid—to match our spending on housing, which the individuals whom he described so desperately need.
Andrew George: It would be quite improper for me, speaking from the Back Benches, to tie the hands of my

477WH
Front-Bench colleagues by making commitments. We certainly strongly support the investment that the Government are proposing to put in. We are undertaking our own spending review, and we will be looking at the Government's commitments, but the Minister knows very well that the Liberal Democrats are very committed to increasing investment in social housing.
Rather than getting involved in such a silly spat, I want the Minister to answer the constructive issues that I raised about exception sites, section 106 agreements and the intermediate market.
Phil Hope: I will certainly do that, but it is important in these debates that we have not only analysis and discussion but the action that goes with that, which requires commitment to deliver from those who take part in the debates.
I move on to deal in some detail with some points that have been raised, turning first to second homes. The hon. Gentleman described the impact of people buying second homes in his constituency, and how that takes away from the market affordable housing for the people who live in his area. He will know that we changed the council tax rules to allow local authorities significantly to reduce the 50 per cent. discount for second homes. That was done to provide additional funds to address the significant impact that second and holiday homes have on local housing markets.
Of course, it is up to local authorities to decide how to use any additional income. I am pleased that local authorities in Cornwall have taken the opportunity afforded by the Government to increase council tax on second homes. It is estimated that that will provide more than £4 million of additional funding for affordable homes in 2004–05. That is a significant amount, given that the Housing Corporation's investment programme in Cornwall will provide about £20 million over the next two years. So that is one successful line that has been taken.
The hon. Gentleman has raised concerns with my Treasury colleagues about the impact of self-invested personal pensions. I have been given assurances, as I think he has in his meetings with those ministerial colleagues, that the relevant policies will not give individuals an incentive to buy properties for personal use, because a tax charge based on the rent imputed on the capital value of the property will be levied on any non-commercial use that is made of it. Therefore, most homes that are bought by a pension fund will need to be sold before the pension can be drawn to provide a secured income in retirement.
It is true that those policies will increase the number of pension funds that can invest in property, but individual property investment is unlikely to be attractive in many cases. The restriction on borrowing to 50 per cent. of the
478WH
value of the scheme's assets, together with the requirement to put all rental income into the pension fund, is likely to be unsuitable for most buy-to-let landlords, who will need to access income returns to fund mortgage repayments. I hope that that reassures the hon. Gentleman.
Unfortunately, I cannot give the hon. Gentleman a similar answer on changing the use classification of second homes. We debated the idea of a separate use class for second homes six months ago, and there were lots of arguments either way. For example, concerns were expressed about the fact that, even if the use class were changed, there would be nothing to prevent someone from claiming that their second home was another family member's main residence, even if it were being used primarily as a second or holiday home. We have had lots of debate about that in the House. Following research into the issue, and feedback on the consultation document that we issued in 2002 on options for changing the use classes order, we have decided not to change the C class, and we shall not be allocating a different use class to second homes. All the research has shown that such a measure would not have the impact that the hon. Gentleman and others would like.
Let me move on to some of the planning issues. PPG3 is all about having a sufficient number of better-designed homes to meet housing need. We want a better mix of housing to reflect everyone's needs, and there has been some development on the issue. We are updating PPG3 to secure more affordable housing and a better match between the housing plan and the needs of the community. Some of our proposals for updating PPG3 will make it clear that affordable housing—this reflects the point made by the hon. Member for South Holland and The Deepings—should be defined in terms of the relationship between local income levels and house prices or rents for different types and sizes of housing, as well as in terms of housing for identified groups, such as key workers. That brings together the points about the affordability of property and people's ability to pay.
The issue of exceptions is still under consideration, but I can say that we are taking all the responses into account in working up our proposals, which we hope to publish in the autumn. We understand the point that is being made.
I realise that I am about to run out of time. I have answered all the questions that have been asked in the Chamber. Rural housing issues, such as affordability and the provision of more housing in the areas that need it most, are at the top of the Government's agenda, and we are responding positively through our strategies. I have also answered one or two of the more detailed points raised by the hon. Member for St. Ives. I hope that he knows that our review and our plans are putting money in place, changing planning procedures and introducing measures to deal with how people behave and how we provide more resources for building. They will address many of the concerns that hon. Members have raised in the debate.

NHS Appointments System
3.30 pm
Mrs. Patsy Calton: I am as always grateful for the opportunity to raise a matter that affects my constituents. This is one that can be literally a matter of life and death, and it has an application that is wider than my constituency. I asked for the debate because of personal experience, the experience of friends and the number of cases coming to me as a constituency MP.
I have been conducting my own survey, and although there are not yet any finished figures—it is early days—we are getting a considerable number of responses. Of the approximately 60 responses that have been received in my constituency office so far, more than half report trouble of one sort or another with appointments.
I am concerned that the figures the Minister will no doubt cite to us later in the debate may tell a partial and possibly misleading story. I have initiated the debate in a spirit of helpfulness, in the hope that the Minister will act to ensure that he is not being misled. Of course, he could treat my contribution as he did yesterday, with dismissive, cheap point scoring, but the public know that there is a problem with some appointments in the NHS, and all his debating points will score nothing with the people who matter—patients who use the NHS.
I am in no way complaining about the vast majority of front-line staff. In many ways, they are the victims of the problems that I shall outline. Certainly, the nurses I meet tell me that they spend a disproportionate amount of their time chasing up appointments for patients.
Problems with appointment systems are of various types. My survey already shows quite a lot of information about cancelled and postponed out-patient appointments. About half the responses received point out such problems. The questions concern a two-year period: participants were asked whether they had had a hospital out-patient appointment in the past two years, whether the hospital had cancelled or postponed it, and how many times it had been changed.
If I take a random sample of responses, I find the following answers: four times, twice, twice, three times in the past six months, twice, one hospital twice and another hospital once, four times and three times. Clearly those replies are not entirely typical. On the whole, the people replying to the survey see themselves as having been messed about by the system. I am well aware of that. However, there is a significant number of such people. I am pleased and grateful that half the replies say that appointments have been fine, and that the respondents have been able to see the person concerned on time. However, that is not happening for a number of people.
I understand that hospitals may well collect their own data. I have been in communication before with local hospitals that have been able to explain matters to me; for example, of the five cancelled appointments that one patient told me about, she had cancelled two. When we asked her whether that was true, she said, "Yes, I had forgotten about those, sorry." I understand that patients are sometimes forgetful, but that does not alter the fact that people are telling us about this problem.
The hospitals collect their own data, which do not necessarily affect the waiting time statistics. A cancelled appointment for a check-up for a life threatening
480WH
condition possibly does not show up in the Government's waiting time statistics. I can understand that a consultant may be ill, or, more often, perhaps, decide to go to a conference abroad. What seems to happen more often than not is that a block of appointments is shifted six months to the back of the queue.
Most of us coming back to work after illness or some other absence have to work a bit harder for a while to make up for lost time. I can imagine what my constituents' attitude would be to their MP saying, "Sorry, I was away for a week. I shall have to put seeing you back six months." They would not be prepared to put up with that, and I would not expect them to. What would happen if a schoolteacher said, "I missed the time when I could have written reports because I was at a conference, so they will not be ready for another six months"? That is simply not acceptable, but it happens too often in hospitals.
The Minister should investigate the issue of cancelled and postponed appointments. He should ask the Healthcare Commission to look behind the waiting time targets for out-patients' appointments to find out about cancelled appointments and how they are handled. I sincerely hope that the practice of sending appointments to patients when they are known to be on holiday, which I have come across once or twice, has stopped.
The Minister may tell us that out-patient waiting times are at a certain level, but the boxes that have been ticked do not necessarily reflect the actuality for patients. I ask him to look behind the figures. I have raised the matter with the chairman of the strategic health authority in my constituency and with others, as the problem is very worrying indeed.
I know of quite a few cancelled and postponed operations. As an MP, I have the opportunity to intervene, which I have done on several occasions. It worries me how often a patient gets what he needs simply because I have written a letter asking whether his operation can be carried out in a timely fashion after one or two cancellations. It worries me that patients who know enough to come to their MP and get themselves placed slightly further up the queue than they would otherwise be cannot do that for themselves with the same result. I want the Minister to discover what impact MPs' letters are having and why the patients themselves cannot have the same impact.
I salute the new patient advice and liaison service, which is doing a better and better job and making a difference in my constituency. However, there are problems. For example, I have a constituent, a young mother with a brain tumour, who needs an operation that will involve her being in hospital for at least a fortnight. She has two young children and her operation has been cancelled twice on the day of the operation. In such circumstances, when family arrangements have to be made, that makes things very difficult indeed. My intervention, and possibly that of the woman's husband, who wrote a letter of complaint, ensured that the third time she prepared for the operation it was actually done, but it is worrying that people have to make a fuss to get their operation.
Unco-ordinated and untimely appointments, possibly—I will only say "possibly"—because of working to the targets, are affecting large numbers of

481WH
patients, including in my own case. The report by CancerBACUP in May 2004 indicated that cancer patients were often left not knowing how long they would have to wait for an appointment. The all-party parliamentary group on cancer has been conducting a Select Committee-style inquiry into the tension between national targets and local decision taking and the impact on cancer services. The group has heard evidence from health professionals and civil servants, who emphasised that shortages of specialist staff such as radiographers, radiologists and chemo nurses are hampering efforts to reduce waiting times for treatment.
Equally, there is good practice, where services have been redesigned. I ask the Minister to ensure that services are redesigned to meet the needs of patients more effectively, as that would bring great benefits. Such good practice should be spread throughout the country rather than being limited to small, isolated pockets, as it really makes a difference and patients benefit tremendously.
I should also like to make the point that CancerBACUP has made, which is that the difference between urgent and non-urgent cancer patients is causing a problem. I know that Ministers have not always agreed with that, but I would argue the case again. Routinely, around a third of the patients referred who are labelled as "non-urgent"—even the urgent cases have difficulty getting through sometimes—are subsequently found to have cancer. There is a serious problem with a system that leaves a third of patients waiting for the length of time that some end up waiting. When such patients are subsequently found to have cancer, it may well be too late for treatment that can make a difference. Again, the appointments systems do not seem to reflect what is necessary.
CancerBACUP has said that it receives phone calls every week from people who are worried about how long they will have to wait for treatment. Not knowing how long one will have to wait and believing that one's prognosis is getting worse in that time is, CancerBACUP says, a source of enormous anxiety to patients and their families. I am sure that the Minister is well aware of that issue, so will he address it? The problem affected me during my treatment—I talk about my treatment and the patient pathway in the round. Not knowing when things are coming is a source of enormous stress and cannot be good for the patient.
To sum up those points, there is a tension between targets and clinical need. It is possible—many are saying this, including consultants—that targets are distorting priorities. In many cases, there appears to be a lack of co-ordination, which means that resources are wasted and additional appointments are needed. There appears to be a lack of capacity. Where targets are attached to one part of the treatment, the patient is given no indication of the total wait. For example, a two-week wait at the beginning to see a consultant does not tell the patient when the diagnostic tests will be conducted. A 62-day wait for treatment to start on a fast-growing cancer is too long and patients cannot wait that long.
Waiting to get on the list is another problem. I received a letter, which came as part of a survey, from somebody who, happily, has now had her operations. She waited for a year and a half to be put on the waiting
482WH
list, which was where she clearly needed to be for bilateral hip replacements. Once on the list, she was told that she would have a 12-month wait and was operated on 363 days later—so, slightly less than a year. The normal waiting system would have made her wait another year for the second hip, but she made a lot of noise and got it four and a half months later. Happily, she managed to climb a mountain in Glen Coe in May with speed and ease, and has sent her thanks to the people who sorted her out. Two and a half years is far too long to wait for that operation; it is simply not on.
A further issue is the interface problems between hospitals. I would ask the Minister to look at that too. CancerBACUP says that the distress and inconvenience that patients suffer can be extreme when there are such problems. Patients can be left for weeks watching a cancer grow, or imagining that it is growing internally, not knowing when their appointments will come. While they wait for diagnostic test appointments, they imagine that the cancer has spread to every area as yet unchecked. Again, the problems of getting information passed between hospitals are extremely serious.
What needs to be done? May I make a plea to the Minister to push to ensure that patients do not leave a previously arranged appointment without having their next step planned and co-ordinated? That means dates for appointments, and so on. It means that GPs, nurses and other authorised persons should be able to make bookings with patients by phone or computer link before the patient leaves. I know that the Government intend that computer link-up to be available by the autumn of 2005. I applaud that and I hope that they make fast progress, but that does not alter the fact that there will still be capacity problems.
I shall make one list point, as I am aware that I have overstayed my welcome. The point that I made to the Prime Minister on 5 May was that when appointment systems are not functioning properly, disadvantaged groups are especially disadvantaged. People like me who know who to contact and who to make a fuss with will end up rising to the top of the queue, if there is a queue. It is wrong that advantaged groups should be able to push themselves forward while disadvantaged groups fall to the bottom of the queue and, according to the National Audit Office, have worse outcomes. I do not ask that everybody get pushed further down the queue, but that there is better co-ordination of appointments and better design of services so that all patients get a better crack of the whip, not just those who are sufficiently articulate to be able to push their way to the front.
3.46 pm
The Parliamentary Under-Secretary of State for Health: Once again, I commend the hon. Member for Cheadle (Mrs. Calton) on securing an Adjournment debate. On this occasion, I agree with a great deal of what she had to say. Very little is as frustrating for people as having appointments cancelled, not being able to get the appointment they need and seeing mistakes being made. Those are issues that we must tackle, and indeed we are tackling them.
The hon. Lady began by saying that she hopes I will not be dismissive of her as I was yesterday. One reason why I was dismissive was her inconsistency. Yesterday,

483WH
she told us why we should scrap all the targets. Today, she gave us a good case for having targets for different types of people, why the targets that we have are not tight enough and why we need to build capacity so that we can improve waiting time targets
Mrs. Calton: Will the Minister give way?
Dr. Ladyman: Let me make some points first. I need to answer the case that the hon. Lady made, and I have only 15 minutes in which to do it.
We are reducing the maximum waiting time for operations. We have reduced it from 18 to nine months already, and we intend to reduce it further. We have reduced the first out-patient appointment waiting time from 26 to 17 weeks. Setting targets was one of the tools that we used to do that. The hon. Lady said that those waiting times do not include the time a person waits for a consultant's referral or for diagnostics. That is true, which is why, in the NHS improvement plan, we set a target for 2008 of a complete patient journey time of 18 weeks from seeing a GP to receiving treatment.
The hon. Lady mentioned cancelled appointments. She seemed to imply—although perhaps I am overstating this—that cancelling appointments might assist people in meeting waiting time targets. I assure her that cancelling appointments in no way alters how the maximum waiting time is measured. Trusts and commissioners are unlikely to achieve the standards that we have set for out-patient waiting times if they allow consultations to be cancelled without good reason.
To be sure that the public can be confident of the accuracy of published NHS waiting times, we have asked the Audit Commission to examine how NHS trusts manage information on waiting lists and waiting times. A spot check programme began in 2002. We agree that when, occasionally, appointments have to be cancelled, it is essential that trusts keep closely in touch with patients to rearrange appointments. The new booking system, which I shall talk about later, will support the NHS in doing that.
We offer other guarantees to patients. Work is being undertaken by the Healthcare Commission to ensure that we do not allow clinical priorities to be distorted by waiting lists. We offer a guarantee, which was introduced in the national health service plan five years ago, for patients whose operations are cancelled at the last minute for non-clinical reasons. The example that the hon. Lady gave of an operation twice being cancelled on the day of the operation should not be happening, because the guarantee, which came into effect in April 2003, says that if operations are cancelled at the last minute, patients are given a new firm date quickly so that they have certainty about their readmission to hospital and capacity is not wasted. If they cannot be offered another appointment within 28 days of their operation being cancelled, the national health service will fund the patient's treatment at a time and hospital of the patient's choosing. We are putting in place guarantees to deal with exactly the sort of case the hon. Lady mentioned. They are terribly difficult to deal with.
The hon. Lady talked about people who know sufficient to go to their MP. Many people come to see me at my surgery because their operations have been
484WH
cancelled. I do not know what it is like in her trust, but if I identify a mishandled case, my trust responds by raising its priority to deal with the error and ensure that the patient is seen within an appropriate time scale. If, on the other hand, someone has come to me to see whether they can jump the queue, the matter continues to be dealt with according to its clinical priority and writing an MP's letter has no impact. That is the way it ought to be.
The hon. Lady is right to identify the patient advice and liaison service, which is increasingly helpful in many constituencies, including my own and hers. It was introduced so that people would not have to go to their MP to have things sorted out and there would be somewhere in the hospital to have issues dealt with through the national health service. It is proving increasingly successful.
The reduction of waiting times and the improvement of patient access are very high on our agenda. We are working to bring down waiting times from referral to treatment to 18 weeks, but clinical assessment of clinical priority will always be the key determinant of how quickly someone is treated.
In developing our health care service, we are taking into account the patient's experience through patient surveys and other systems to provide better feedback. All surveys focus on issues that patients say are important, not issues decided centrally. The development of national standards, including the national service frameworks, is an important part of ensuring that clinical priority always comes first.
I remind the hon. Lady that the implementation of national service frameworks is mandatory on the national health service. The frameworks are targets. She and many of her hon. and right hon. Friends support much of the work being done under the national service frameworks, so they are, by implication, supporting a target. We must accept that.
Mrs. Calton: The Minister pushes the case on targets somewhat. All of us would accept that a change of culture needed to take place in the health service and that some targets have assisted that change. He would accept, too, that there are misgivings about the effects that some of those targets are having two or three steps down the line and that some are producing unwanted effects. I ask him to be a little less dismissive of the concerns about targets, because there are legitimate concerns.
Mr. Bill Olner (in the Chair): Order. This is becoming a speech.
Dr. Ladyman: Again, I agree with the hon. Lady. This is a point that we have made consistently: it was necessary to change the culture of the national health service, which is why we had to have many clear targets. Whenever one tries to change the culture of an organisation and how it works, firm leadership and firm management of the direction of travel are necessary.
We have made progress, so we have announced that we will reduce the number of targets and examine the way that targets are working to produce cleverer, better and more appropriate targets—targeted targets, if the hon. Lady will. I cannot give her an announcement

485WH
today, because we will be publishing shortly the Department's public service agreements and the planning and priorities framework. However, when they are published, I am fairly confident that she will see the current 62 targets dramatically reduced. They will be much broader and different from the current targets, but they will still be targets; they will still be mandatory and there will still be clear, central leadership. That will allow a lot of local decision making and prioritisation, but there will still be a clear central vision of what the NHS needs to become, which is important.
I will deal now with specific points that the hon. Lady made about appointments. We have been talking mostly about secondary care, but I need to reflect for a moment on primary care. We have set a target of patients being able to see a GP within 48 hours and a primary care professional within 24 hours by December this year. Nationally, the vast majority of patients—about 98 per cent.—can now be offered a GP appointment within two working days. That compares with 75 per cent. two years ago, so there has been progress.
I am grateful to the GPs and nurses who have made that possible. Through the primary care collaborative approach, the national primary care development team, led by Sir John Oldham, has supported more than 5,000 practices, covering more than 32 million patients, in taking up the advanced access methodology to improve access for patients. Advanced access involves doing a lot of simple things differently. I think the hon. Lady said that service redesign could help a great deal in achieving targets. Patients benefit from advanced access, as do staff. It has reduced waiting times to see a GP by about 50 per cent., so it is an important step forward.
The target of seeing a GP within 48 hours or another primary care professional within 24 hours does not prevent people from making their own choice. They may want to see a GP at a later date because that is more convenient, and that choice should be available.
The hon. Lady mentioned our plan to use IT systems to streamline and co-ordinate improvements, which is a huge and important project. Over the next four years, the culture of waiting that has long been a feature of the NHS will be replaced by a personalised approach to care. The information systems that we put in place will enable patients to choose more convenient and higher-quality personalised care. An individual personal care record, for example, will enable health professionals to
486WH
have easy and rapid access to patients' medical histories at any time. It will also allow patients to influence how they are treated in a way that they cannot do now.
The booking of hospital appointments is a cornerstone of our reforms; it is central to the provision of a new, modern service, as the hon. Lady said it needed to be. By the end of next year, an electronic booking system will make it easier for patients to arrange appointments that suit them. That will be a fundamental change in how hospital appointments are booked. As she said, at the moment people have to wait for a letter or postcard; they do not know when it will come. They have to leave the hospital and come back, hoping that sooner or later the postcard will follow them. All that will change.
Appointments used to be made clinic by clinic. Each clinic, and sometimes each consultant, had a different way of booking appointments, which was expensive, time-consuming and the cause of many mistakes. Now, 96 per cent. of day cases and more than two thirds of out-patient appointments and in-patient elective admissions are booked. That is a considerable achievement in a relatively short time.
By December next year, all NHS patients will be able to choose between a range of providers for hospital appointments and they will be able to book their appointment for a date and time that suits them. Gone will be the misery of wondering when they might make the front of the queue; they will know exactly when the appointment is and that it does not clash with another commitment.
We will go further, so that by 2008 there will be independently assessed health care providers providing treatment within a maximum agreed price range that people can choose from. People will be able to sit in their GP's surgery, or even on the sofa at home, and not only choose a consultant, but make a booking that suits them to receive treatment.
Underpinning those changes will be a booking management service to support patients in making, amending and cancelling appointments, because quite frequently it is patients who do that. We will bring to an end the traditional system of NHS waiting lists; that will genuinely put patients at the centre of their NHS treatment. That will create a fundamental shift in how we do things and completely revolutionise the national health service. Those changes—
Mr. Bill Olner: Order. We must move on to the last debate of the afternoon.

Science Park (Sittingbourne and Sheppey)
4 pm
Mr. Derek Wyatt: I am extremely grateful to have been granted this debate on the Kent science part and its owners, LaSalle Investment Management, the pension fund for Mars UK Ltd.
I am a big fan of science and technology. I was a fellow of the Industry and Parliament Trust, working with Motorola. I spent 18 months looking into satellite technology, both here and in America, and I am due to visit Motorola in Chicago shortly. I was the only MP on the BT Vital Vision programme at Berkeley and Stanford, which looked into change management in systems, and I am one of the founders of the Oxford Internet Institute, with which I have helped to raise £15 million. So, I am a fan of science and technology; I want it, I like it and I think it is a great change.
I am worried about Kent science park on every single level, which is why I am raising the issue with the Minister. Almost a year ago, on 21 July 2003, Swale borough council's economic scrutiny panel minutes read:
"In relation to the feasibility of the Southern Relief Road, the Chief Executive explained that Sittingbourne Research Centre … had been identified as an Enterprise Hub And had great potential to benefit the local economy. As a result, a submission had been made to the Office of the Deputy Prime Minister … for funding for a feasibility study to be carried out on the implications of a proposed junction from the M2, which could serve the site and east and south Sittingbourne."
From the fact that the chief executive of Swale borough council commented at that early stage, it follows that the chief executive, the leader of the council—Andrew Bowles—and the Conservative executive must have been in confidential talks for a considerable time with the South East England Development Agency, the Government office for the south-east, possibly the Thames gateway and the owners of the research centre.
As an aside, I would say that the local government reforms that we introduced at the end of the 1990s have not worked; they have led to greater secrecy and much less democracy.
First, I would like to ask the Minister when he first became aware of the plans for a southern ring road. LaSalle Investment Management bought Kent science park, or Sittingbourne research centre—Shell research centre, as it used to be called. The last thing Kent science park is is a science park.
Earlier this year, the Deputy Prime Minister had a photograph taken and made a statement at a trade fair in France. What he said has been widely interpreted by my constituents and the local media as meaning that the Government are 100 per cent. behind the plans. I hope that the Minister puts the record straight.
Science parks in the United Kingdom are inevitably attached to a university. Consider the evidence. On 27 April 2001, it was announced that Leeds university was to build a 110-hectare science park. On 18 May 2001, it was announced that Leicester university was to build a science park next to the National Space Centre. On 28 June 2001, it was announced that Bristol and Bath universities were to join forces to create an innovation centre for technology start-up businesses.
488WH
On 14 February 2003, it was announced that Liverpool university and Liverpool John Moores university were to provide a science park paid for by the local regional development agency. On 1 August 2002, it was announced that London was to launch a centre for bioscience, and on 3 January 2004 that Nottingham university and Nottingham Trent university were to open the largest biomedical science park and incubation centre in the United Kingdom. Before then, there was a much older science park tradition with science parks at Surrey—the first—Cambridge and Oxford.
The Kent science park is only 80 per cent. occupied. That 80 per cent. is sub-divided 50:50 between concerns that involve science and those that do not. It is now clear from LaSalle's objections to the draft Swale borough council local plan that it already knows that a second park on greenfield land would not necessarily be driven exclusively by science. In effect, it wants an open-ended business park that may or may not involve any world-class science companies. That is not surprising.
I asked the UK Science Park Association how many parks have been built since 2000 that are not attached to a university. It confirmed in an e-mail that there is only one—the Colworth science park at Sharnbrook in Bedfordshire—but that happens to be owned by Unilever. That is rather like the Shell research centre that used to be in Sittingbourne. We have in Sittingbourne no university and no further education college, and there are no plans for either. Therefore, I suspect that a science park that is not a science park, and that will not be connected to the needs of local people, will fail. Can the Minister confirm that, on the existing Kent science park, there is still substantial room to refit the buildings or build new ones and that, therefore, a second park is not necessarily required? Is he aware that in 1992, when the park was known as the Shell research centre, more than 1,200 people worked there, whereas today some 800 do?
Is access a problem? I confess that I have not received a single letter about that from either a constituent who lives on the route to the park or a single company on the park. A constituent has provided me with the following notes about objections to the Kent and Medway structure plan. The first is KMSP deposit consultation—policy NK3, dated 10 November 2003:
"Name: Mr. Brian Lloyd (on behalf of Swale borough council). Consultee comment: Amend (e) to read 'expansion of the Sittingbourne Research Centre as a mixed science cluster supported by the provision of a southern Sittingbourne Relief Road linking the A2 to a new junction on the M2 motorway'."
The second is KMSP deposit consultation—policy FP4, dated 10 November 2003:
"Name: Mr. Brian Lloyd. Consultee comment: Reference to Sittingbourne Research Centre to read 'Sittingbourne Research Centre, supported by the provision of a southern Sittingbourne Relief Road linking the A2 to a new junction on the M2 motorway'."
My problem, on which I hope the Minister can shed some light, is this: how could Swale borough council put a request in November 2003 to the Kent and Medway structure plan that it wanted a significant change to the planning when it was, at the same time, launching a draft local plan over which it would be both judge and jury? That does not strike me as fair or democratic. It seems that the authority owns all the rights and its citizens have none.

489WH
Why is Swale borough council so keen to have a southern ring road when we are still struggling over the northern distributor road, which opened only earlier this year? Indeed, if funding for crossing the creek at Milton is not found, and the additional exit at Bapchild on to the A2 remains incomplete, there is a danger—as another constituent put it to me at the weekend—of the northern distributor road becoming the biggest cul-de-sac in Kent. I hope the Minister will allay those fears.
I understand that research commissioned by the Office of the Deputy Prime Minister on a traffic model shows that the northern distributor road will take 20 per cent. of through traffic away from Sittingbourne centre. That seems remarkably low. Why put upwards of £25 million into the northern distributor road if it is going to take away only 20 per cent. of through traffic? I am speculating, but I hope that the Minister says when the survey will be put in the public domain. I have to ask him whether the Thames gateway should have produced the model before agreeing the funding. Will he comment on that? Swale borough council has also introduced traffic calming at Bapchild and Tunstall, so I hope that has been factored into the modelling.
A new access road from the motorway would attract new companies to the Kent science park—either now or in future, if the extension is granted—and make it easier for employees to get to work. The cost of a single extension would be approximately £10 million. However, that would do nothing for my constituents, as none of the high-skill jobs would be filled by them. A new exit would have the unintended consequence of opening the south side of the motorway on to the spectacularly beautiful north weald of Kent. I think that various agencies would have serious objections to that idea. The Highways Agency is opposed to a new exit, as indicated in an e-mail dated 6 April 2004. Can the Minister confirm that it is for Kent county council to make the case for a new exit and for the ODPM to say yes or no?
The owners of the new Kent science park need to persuade my local borough council to allow them to build a second park with associated housing, which will help to pay for the extension. That will provide a new southern ring road. The council wants to exchange a science park that will not be a science park for some 5,000 to 6,500 brand new high-density houses on greenfield sites. Hon. Members might expect me to complain about that. However, I have been the local MP since 1997, and I have to say that the Labour Government have been incredibly generous to my community. We have had a £100 million bridge and a new hospital in Minster. Wards have been opened in a hospital built by a previous Conservative Administration, who could not afford to open them. We have had Sure Start in Sheerness, which is sensational; extensions to schools; computer suites; and the promise of a new Rushenden link road. We stopped an asylum centre at Coniston, and just recently the Allied Steel and Wire Sheerness occupational pensions campaign led to the Chancellor and the Secretary of State for Work and Pensions giving us £400 million for failed pensions. Dare I say it—we have never had such Government investment and it has been worth waiting 18 years for it.
490WH
I will stop there because, in a sense, what happened next causes more concern. The ODPM has asked the south-east to build more homes; everyone recognises that it is the engine that is driving growth for the whole United Kingdom. Of course, we must build the roads. However, according to the draft Swale borough council plan, 9,000 new homes are to be anticipated between 2006 and 2016. That figure is approximate depending on whether we are talking about 2.4 people per house or 2.8. Whichever statistic is used, there will be somewhere between 22,000 and 30,000 extra people, who will all need doctors, schools, policing, water, electricity and other essential infrastructure. At every level, that will strain the community that I represent. The good thing is that 90 per cent. of the build will be on brownfield sites.
The southern ring road affects five parishes: Bredgar, Tunstall, Rodmersham, Milstead and Bapchild. I went to a meeting last week and I have to say that people there have lost complete faith in the local democratic process. They are having to raise their own funds to pay for their own representation. I have told them that, later in the year under information legislation, I will request telephone logs, e-mails and correspondence between the Conservative executive, its officers, LaSalle and the landowners, where applicable.
LaSalle hopes that the executive at Swale borough council will fall for a new science park that is only a glorified business park. It wants a new southern ring road paid for by a section 106 order, which will increase the number of people involved by between 12,000 and 18,000, on top of the 22,000 to 30,000. In other words, over the next 10 years we would be asked to cater for perhaps 34,000 people, but possibly as many as 48,000. That is absurd and it flies in the face of what Sir Sandy Bruce-Lockhart, the leader of Kent county council, said in a letter to me:
"In my view, a development of anything like 6,000 homes would be totally unacceptable."
Kent science park will not create new jobs for my constituents and it will not attract a university or further education college. It will make us a vast dormitory town and make two landowners very rich.
In relation to Monday's three-year spending review announcement, I draw the Minister's attention to the publication on the science and innovation investment framework—sponsored by the Treasury, the Department of Trade and Industry and the Department for Education and Skills—of the document relating to 2004 to 2014. Among many excellent things, it draws attention to the fact i that the Government announced
"that it will build the Higher Education Innovation Fund as a permanent third stream of funding for universities in England to further build the capacity in the university sector for knowledge transfer."
It continues:
"The Government will develop this policy as part of its ten-year investment framework for science and innovation."
Nowhere in the document is there anything about individual science parks that are commercial entities and not attached to universities. If we could have a university, I would rethink the whole issue.
This is what I want for my community: Sure Start for Eastchurch, Rushenden, Milton and Murston; improvements in relation to primary schools; one system of secondary schools, especially on the Isle of

491WH
Sheppey; a further education college; and a sixth-form college or academy. I would love a postgraduate university department. I would like to bed down the northern distributor road before we start on a southern distributor road, and I would like a bypass for Newington and work to start on the Rushenden link road. I would like more job opportunities on the island and greater sporting and cultural entities. None of those things will happen if the Kent science park is built.
If we, the Labour Government practise what we preach, let the Learning and Skills Council propose a plan to build a further education college for Sittingbourne. Let the Department for Education and Skills give university status to Imperial college and ask it to merge with Kent university at Canterbury. Let the new world-class university open a graduate science department on the Kent science site. Let us move the 40 per cent. of people on the existing site who have no science base to space on the Eurolink estate in Sittingbourne. That is a win-win-win situation. That is what we need now, not this seriously flawed plan from a pension fund representing Mars UK Ltd. that wants to rape our countryside for its own ends.
4.15 pm
The Minister for Housing and Planning: I begin by congratulating my hon. Friend the Member for Sittingbourne and Sheppey (Mr. Wyatt) on securing the debate. He is well known as a keen advocate of his constituency and for bringing constituency issues to the attention of the House.
Before I address the matter that my hon. Friend has so eloquently put before us, I remind the House of my Department's commitment to Swale. As part of the Thames gateway growth area, Swale submitted bids for funding from the sustainable communities plan. In July 2003, the Deputy Prime Minister announced that four projects would receive funding in the next three years. Those projects included: £10.4 million to the Sittingbourne northern relief road to support mixed-use development to the north of Sittingbourne; £3.6 million for improvements to Sittingbourne town centre; and £7 million for a mixed-use redevelopment scheme in Queenborough on the Isle of Sheppey. In addition, a number of education, environmental and community regeneration schemes approved for north Kent will directly benefit the residents of Swale.
Also included in the package was a £1.3 million grant for the Kent science park, formerly known as the Sittingbourne research centre. The science park houses 80 businesses, providing 1,000 jobs with a focus on life sciences. It has been designated by the South East England Development Agency as one of a network of enterprise hubs across the south-east. As an enterprise hub, the site provides units for small science-based businesses to start up. That has been successful and £1 million from my Department is going towards a project to renovate a building on the science park to provide space for those businesses to expand when they outgrow the innovation buildings.
Both Kent county council and Swale borough council support the expansion of the site as a science park. Policies encouraging the further development of the site as an innovation hub are included ill both the draft Kent and Medway structure plan and the draft Swale
492WH
borough local plan. However, it is recognised that any major expansion of the site will raise a number of planning issues, not least that of providing better road access. For that reason, the Government have approved a grant of £300,000 for a feasibility study into the possible provision of a new junction on the M2, as well as other options. The study is nearing completion. Any major changes to the highway network would take several years to complete. As Swale borough council does not want to stifle the further development of science-based industries on the site, a policy has been included in the draft local plan allowing limited expansion if measures are taken to minimise the generation of extra traffic on existing roads.
My hon. Friend wrote to me earlier this year about his concerns regarding the future expansion of the Kent science park. He emphasised the need for a strong link between the science park and research-based universities and expressed his view that the feasibility study on access should be put back until the Sittingbourne northern relief road had been completed. In my reply, I stated that, due to the long run-in times for delivering new roads, to wait for the new northern relief road to be completed before carrying out the study might leave developing the site too late to support the regeneration of Sittingbourne as a whole. The feasibility study will, at this time, inform not only the future development of the science park, but take into account the other redevelopment works in Sittingbourne. To delay the study would therefore be counter-productive and leave a large part of the regeneration of Sittingbourne uncertain.
The reasons for the absence of a research-based university in the Kent science park are largely historical. The science park has been developed during the last 10 years on the site of the former Shell research facility and is one of the few privately owned science parks in the country. One of the purposes of the enterprise hub is to strengthen links with academic establishments. Many links have been developed between firms on the site and the universities of Greenwich, Kent at Canterbury and London. For example, one firm is developing a shared lab facility with the university of Kent, and an employees training unit to be launched later this month will involve the Kent new technology institute.
The Kent science park was identified as the location for one of a small number of flagship centres for technology and business development in work undertaken for the Thames gateway innovation subgroup. The consultants identified as a prerequisite for a viable flagship the need to secure a suitable anchor member. The businesses on the science park are a good nucleus on which to build. The site represents the largest single concentration of laboratories to let in the UK, with buildings suitable for biological and chemical sciences, pilot-scale production and clean and constant temperature activities. Existing tenants include major pharmaceutical and biotechnology companies, of which Pfizer is one, as well as technology-based business in environmental technology, electronics diagnostics instrumentation and information technology. I understand my hon. Friend's concern about the present make-up of the park, but I understand that the trend is towards mixed business parks. Good office accommodation as well as on-site conference facilities will also be required.

493WH
My hon. Friend also raised the issue of housing on the site. Under Highways Agency rules, a new motorway junction cannot serve a single site but must link into the wider highway network. For that reason, the feasibility study will also examine a link between the M2 and the A2. Clearly, such a road could open up land to the south of Sittingbourne and raise the possibility of land being released in future to help to meet Swale's housing needs. Furthermore, the sustainable communities plan supports developments where mixed use would contribute to reducing commuter and business travel, thus easing congestion. That is of particular relevance on the A2 and M2, which are not only the main trunk roads between Sittingbourne and its neighbours, but major links between the ports of Dover and Folkestone and the rest of the UK. My hon. Friend asked when the Government first became aware of the southern link road plans. The answer is: when a bid for sustainable communities fund money was made in 2003 by the Thames gateway Kent partnership.
The site owner recently proposed a scheme for a major expansion of the site, including 72 hectares of employment land and 150 hectares of housing and community facilities, together with the provision of the M2-A2 link. That would entail the development of some 5,000 houses, which the site owner believes are necessary to fund the whole package. I emphasise that that figure has not emerged from the feasibility study and has not yet been subjected to any testing through the planning system. Such a major proposal raises wider issues relating to the long-term housing and employment needs of the area, and it will need to be fully debated at
494WH
the public examination of the draft Kent and Medway structure plan in September. By then, the feasibility study on the road access will have been completed. It will indicate the practicability of a new junction and link road, and the cost that would be involved. The funding mechanism for the infrastructure will have to be considered carefully before any further proposals for the science park or new housing in that part of Sittingbourne can be properly evaluated.
I emphasise that the Government have made no decisions about the expansion of the science park, the proposed link road or the housing. The public examination will be the first stage of evaluating the proposal. It might lead to proposals being advanced in the Swale local plan, which will go to public inquiry next year. I emphasise that there will be full opportunities for public consultation before any decisions are made. The House will understand that I cannot pre-empt the results of the public examination or the local planning inquiry. The aim must be to encourage the development of the science park as a centre for innovation and high-quality employment in a sustainable way that brings the maximum benefit to the area as a whole.
Complex issues are involved and I am grateful to my hon. Friend for highlighting them in this debate. It goes without saying that I sympathise with his vision for improving education in his constituency. However, he and the House will understand that such matters fall outside my responsibilities as Minister for Housing and Planning.
Question put and agreed to.
Adjourned accordingly, at twenty-three minutes past Four o'clock.

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

Lord Dykes
Hugh John Maxwell Dykes, Esquire, having been created Baron Dykes, of Harrow Weald in the London Borough of Harrow, for life—Was, in his robes, introduced between the Lord McNally and the Lord Dholakia.
Lord Haworth
Alan Robert Haworth, Esquire, having been created Baron Haworth, of Fisherfield in Ross and Cromarty, for life—Was, in his robes, introduced between the Lord Dubs and the Lord Elder, and made the solemn Affirmation.

European Higher Education Area
2.48 p.m.
Lord Quirk asked Her Majesty's Government:
What implications for their higher education policy are presented by the Bologna process to create a European higher education area.
The Parliamentary Under-Secretary of State, Department for Education and Skills (Baroness Ashton of Upholland):My Lords, we welcome the increased potential for mobility, of both students and researchers, afforded by creating a European higher education area. The structure and international merit of the UK's higher education system is already reflected in the Bachelors/Masters/PhD cycle envisaged by Bologna. We are actively involved in influencing the debate. Key action areas currently include developing the diploma supplement and contributions to discussions on qualifications frameworks and quality assurance systems.
Lord Quirk:My Lords, I am grateful to the Minister for that reply. Clearly, with events such as the Edinburgh seminar a couple of weeks ago, the Glasgow summit next May and the ministerial plenary session just after, not to mention the plans for a European research council, the pace is growing, as are the costs. She referred to the diploma supplement. Will the Government help universities with the additional costs to which they have already signed us up, such as the issue of a diploma supplement from next year?
More broadly, I wonder about the possibility of a culture clash between a British focus on outcomes and a continental fixation with inputs such as time of study. Now that 25 of the 40 Bologna countries are part of the EU, will the Government resist any
1240
pressures under which they may come from the European Commission towards a harmonisation that could interfere with the flexibilities of the UK system, such as our one-year Masters degree and quality control provisions?
Baroness Ashton of Upholland: My Lords, a focus on outcomes is absolutely critical. There is no conflict on the one-year Masters degree, which is something of which we are very proud. We continue to work with it, and there is no conflict with Bologna. There are no plans for a research council at present; the DTI is consulting on the subject, but no proposals have been put on the table. The diploma supplement is very much about additional information for students, which is important. We are talking to the universities, but I cannot make any commitments on funding. In general, it is to be welcomed that Bologna offers real opportunities for mobility.
Lord Wallace of Saltaire:My Lords, I invite the Minister to comment on the statement made by the president of Universities UK last night that:
"The UK Government, and most universities it must be said, have largely stood aside from the Bologna Process",
so far. Do the Government now plan to have a much more serious and sustained engagement in the negotiations as they warm up?
Baroness Ashton of Upholland:My Lords, I was sorry to miss the speech of the president of UUK last night, but I have a copy. We have not stood aside. Our contribution in Bologna, Berlin and Bergen next year will be critical. We are very committed to the process, working closely with UUK to ensure that we provide the energy and support that it needs.
Lord Dearing:My Lords, I do not recall the Minister answering the question asked by the noble Lord, Lord Quirk, on whether the Government would strive to ensure that awards were based on outcomes rather than processes. Does she see scope within the framework of Bologna for recognition of an award such as a foundation degree, a distinct form of degree that serves to give standing to vocational awards throughout Europe?
Baroness Ashton of Upholland:My Lords, I said that there would be a focus on outcomes; I am sorry if the noble Lord did not hear me. The foundation degree is important, and we are the only country currently offering it. There is no conflict with Bologna, and we wish to see the foundation degree recognised fully for its contribution to lifelong learning.
Lord Harrison:My Lords, does my noble friend recognise that the one-year MA courses in this country are important for encouraging overseas students to take advantage of the British university system, and that it would be a mistake if we moved to the two-year MA system of some of our continental colleagues?
Baroness Ashton of Upholland:My Lords, we believe that our one-year Masters system is strong and rigorous

1241
and is highly valued by international students. We would not wish to see a two-year requirement for a European Masters degree as that would leave us out of step.
Baroness Seccombe:My Lords, can the Minister tell us the Government's policy on the further European integration of education?
Baroness Ashton of Upholland:My Lords, we see processes such as Bologna—where we have the opportunity to think about our higher education system and opportunities for mobility between researchers, teachers and students—as a good example of how best to develop the right kind of links in both a European economy and a global economy. Such opportunities are important also for schools.
Baroness Warwick of Undercliffe:My Lords, in expressing my support for the concerns expressed by the noble Lord, Lord Quirk, perhaps I can declare an interest as chief executive of Universities UK. As the Bologna process moves on, it is clear that the Government's involvement needs to be very much increased. Can my noble friend the Minister confirm the Government's support for the work of the UK-wide Europe unit and confirm that she will ensure that there is appropriate ministerial participation at Bologna summits; high-level official representation in Bologna forums; and practical support for the introduction of Bologna reforms in institutions?
Baroness Ashton of Upholland:My Lords, I can indeed offer my support to the work of the Europe unit—which I did not know about until yesterday, as I am not the Minister with responsibility for this policy area. However, I was delighted to hear of the work being done by Universities UK and the funding councils and the contribution that our senior officials are making to the committees involved. I can confirm ministerial involvement in the work that has gone beyond Bologna, for Bergen next year. We will continue to be in dialogue on the issues surrounding universities' involvement. However, I believe that the UK is already well placed.
Lord Sutherland of Houndwood:My Lords, can the Minister assure us that there is no further likelihood of an additional level of quality assurance regulation being imposed as a result of this? If she cannot do so, can she assure us that she would resist such an imposition?
Baroness Ashton of Upholland:My Lords, although I can assure the noble Lord that we would resist such an imposition, there are no such plans. Quality assurance is being worked on in the sense of collaborative approaches across Europe, not with any view to an over-arching European quality assurance system.
Baroness Sharp of Guildford:My Lords, can the Minister tell us whether there is any problem in
1242
accommodating the MEng degree—Master of Engineering—which is commonly taken in the United Kingdom by engineering students?
Baroness Ashton of Upholland:My Lords, I know that concern has been expressed about the MEng degree. Nothing in the Bologna agreement or process should impinge on that in any way whatever.

Prisoners: Right to Vote
2.56 p.m.
The Lord Bishop of Worcester:My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare my interest as the Bishop to Her Majesty's Prisons.
The Question was as follows:
To ask Her Majesty's Government why they referred to the Grand Chamber of the European Court of Human Rights the judgment of that court in Hirst v United Kingdom concerning a violation of Article 3, Protocol 1 of the European convention in the matter of the denial to all sentenced prisoners of the right to vote.
The Parliamentary Under-Secretary of State, Department for Constitutional Affairs (Lord Filkin):My Lords, it has been the view of successive governments, including this Government, that persons who have committed crimes serious enough to warrant a custodial sentence should forfeit the right to have a say in how the country is governed while they are detained. The judgment of the European Court of Human Rights in the Hirst case challenges this position. We wish to ensure that the issues in relation to this important and long-standing policy are fully considered.
The Lord Bishop of Worcester:My Lords, I thank the Minister for that reply, particularly for the fact that he has not sought to suggest that the present blanket disenfranchisement of convicted prisoners serves any useful purpose. Would it not be better now for the Government, given the unanimous ruling of the court, to proceed to the drafting of legislation that would allow the courts to impose a sentence of disenfranchisement as an additional penalty when they thought it appropriate? Would not such legislation mean that there were voters in our prisons and, therefore, that prospective and present Members of the other place would have an incentive to have considerable interest in what goes on there and support the Government's rehabilitation policies? Might not those rehabilitation policies be further advanced by the teaching of citizenship in relation to the right to vote?
Lord Filkin:My Lords, my answer is no to the first question and probably no to many of the subsequent ones. The central question concerned whether we should start drafting legislation. The answer to that is no, because we believe that we have an arguable case. We think that it is an important issue. It has been part

1243
of the tradition of this society for very many years. It has also been a policy that has been tested by the opinion of both Houses of Parliament as recently as 2000, under the Representation of the People Act, when we introduced a modification to allow prisoners held on remand to vote—but not wider than that. Therefore, we, along with many other member countries in the Council of Europe, think that we are right in our policy position.
Lord Lester of Herne Hill:My Lords, perhaps I may make a prediction, which is that the Government will now be humiliated by the Grand Chamber if they insist on taking this case before that court. As the right reverend Prelate has indicated, this was a unanimous decision. It included Sir Nicolas Bratza, the British judge; and it was a balanced judgment. The Minister has not yet told the House—I should be grateful if he would—why the Government disagree with the decision that legislation is disproportionate if it disqualifies 70,000 convicted prisoners of the right to vote, irrespective of sentence and irrespective of the nature and gravity of the offence. How can that demonstrate a proper sense of proportion?
Lord Filkin:My Lords, now is not the time to engage in the hearing that will go before the Grand Chamber. I shall refer to a specific issue. One of the central arguments given by the court was the recognition of a large measure of discretion for nation states in this respect. While recognising that, the judgment did not appear to apply that test to its own judgment. It did not in any way indicate the limits of the discretion that the court thought would be appropriate.
Lord Dholakia:My Lords, does the Minister accept that the right to vote is fundamental to our democratic values? It is accepted that those who are convicted lose certain rights, but that has nothing to do with control and discipline in prisons. Therefore, it is important that those democratic rights are valued so far as concerns our inmates.
Lord Filkin:My Lords, it is in part because we believe that active participation in democracy is important in our society that the state takes the view, as have many previous governments, that people who, by their actions, have breached that contract should for the limited period that they are in prison lose that right. Of course, the nature of imprisonment is that a person loses a range of rights. That is an unfortunate but necessary part of the prison process.
Lord Avebury:My Lords, does the noble Lord agree that it is not in the nature of imprisonment that a prisoner should lose his rights because, otherwise, that principle would be applied to remand prisoners as well? Can he say which other western European countries adopt a blanket ban on prisoners' voting rights?
Lord Filkin:My Lords, it would take too long to give the full list but I shall write to the noble Lord.
1244
However, perhaps I can summarise it. Eighteen out of 51 Council of Europe countries have no restrictions; nine have a prohibition on all prisoners; some, like Ireland, while having no legal prohibition, offer no practical rights and therefore, in practice, prisoners are not able to vote; and others have a range of restrictions according to the severity of the sentence. I shall write with full details of all such countries.
Baroness Stern:My Lords, is the Minister aware that the Canadian Supreme Court decided that Canadian prisoners must retain their right to vote because that helps to train them in citizenship and it helps their social reintegration? Does the Minister see any merit in those arguments?
Lord Filkin:My Lords, we are aware of that debate and our position in this respect is quite clear, as is that of both Houses of Parliament. These are not simple issues. Nevertheless, for many years it has been part of our society's tradition that, when people are imprisoned, they lose a range of rights, one of which is the right to participate in elections.

Haskins Report
3.2 p.m.
Lord Renton of Mount Harry Lord Renton of Mount Harry asked Her Majesty's Government:
When they will implement the recommendations in the Haskins report.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty):My Lords, my right honourable friend the Secretary of State hopes to announce shortly our decisions on the report by my noble friend Lord Haskins. It will include how and when the decisions will be implemented.
Lord Renton of Mount Harry:My Lords, I thank the noble Lord for that Answer and declare an interest as chairman of the Sussex Downs Conservation Board. If behind his reply is the fact that the Secretary of State is, as is widely thought, to announce her decisions on the Haskins report on 22 July, the last day on which Parliament meets, I consider that to be quite disgraceful.
The Government had 10 months in which to consider the recommendations of the noble Lord, Lord Haskins, and they gave them a warm welcome at the start. Does the Minister accept that at present no one in either the agricultural or environmental industries knows who is to be responsible for delivery in the years ahead? Is it to be the Countryside Agency, Defra or English Nature? Surely, if they believe in rural proofing, the Government have a duty to respond to the report quickly and not on the last day of the parliamentary Session.
Lord Whitty:My Lords, the noble Lord will be aware that over the decades governments have made

1245
Statements during the last days of any Session of Parliament. Such Statements have equal validity and carry equal accountability, and noble Lords have the ability to query Statements made at any time during the parliamentary Session. Therefore, I do not think that the word "disgraceful" is appropriate here. These are complex issues. We gave a clear and broad indication of how the delivery structure would be altered in the light of the recommendations from my noble friend Lord Haskins, and the details of that will be conveyed in a Statement shortly.
Lord Livsey of Talgarth:My Lords, will the Minister admit that one reason for the delay is the Chancellor's Comprehensive Spending Review? What impact will the CSR have on the implementation of the Haskins report, given that Defra is subject to cuts in the CSR? How are both the CSR and the Haskins report to be integrated into future government policy?
Lord Whitty:My Lords, Defra is not subject to cuts in the CSR. I thought that it was Liberal Democrat policy, and possibly Tory policy, to cut Defra's budget, but it is certainly not the Government's. The Government have provided additional resources to Defra but the implementation of the Haskins report was not delayed because of the CSR decisions. Through the efficiency arrangements, the CSR provides some additional implementation resources but that is not central to the timing of the decision. It has been a complex matter, involving both serious discussions with staff and very serious discussions with many stakeholders, the details of which will be revealed shortly.
Lord Grantchester:My Lords, does the Minister agree that the most important aspect is to put in place the correct framework for the long term and not to rush ahead with a short-term fix? Is not the best way to approach this matter to put delivery in the context of the rural strategy, reflecting all the changes that the agricultural industry is presently undergoing?
Lord Whitty:Indeed, my Lords. The announcement will be made in that broader context and will not simply be about the mechanisms. The other dimension to the issue, and the most complex, is the need to look at all the funding streams, as well as the machinery, so that we can rationalise and simplify for the benefit of all rural stakeholders the way in which government support rural industry, including agriculture.
Baroness Byford:My Lords, if the Minister cannot agree with my noble friend that the handling of this matter has been disgraceful, will he not at least agree that the Government and his department have dragged their feet on it? The noble Lord, Lord Haskins, hoped that the report would be put before us in April, but we are now in July. I should like to know what is meant by "shortly". Will the Minister tell the House how farmers are supposed to deal with cross-compliance issues when no agency is already set up?
Lord Whitty:My Lords, with regard to the last point, I think that the noble Baroness completely misunderstands the issue. Neither the specialist agencies nor the Rural Payments Agency are affected by the change of structure that we are talking about in relation to cross-compliance, on which an announcement will also be made shortly. As to when "shortly" will be, I cannot say precisely, but the noble Lord, Lord Renton of Mount Harry, was not a million miles away from what noble Lords will find out definitively next week.
The Countess of Mar:My Lords, can the Minister say whether Defra has got past the discussions-about-discussions stage and whether it is now taking part in practical discussions?
Lord Whitty:Yes, my Lords, we are in practical discussions. Clearly, setting up any institutional change within Whitehall also requires ongoing discussions, but they are ongoing discussions aimed at a result.
Baroness Miller of Chilthorne Domer:My Lords, does the Minister agree that local authorities are very well placed to deliver the social and economic side of many of the things that need to be delivered? I think that that point was accepted by the noble Lord, Lord Haskins. Does the Minister also accept that some local authorities in parts of the country where there are many small family farms and people who are particularly affected by CAP reform will need considerably more in the way of resource and government freedom to deliver than perhaps those in the eastern half of the country, which will have a far easier time of it?
Lord Whitty:My Lords, the report of my noble friend Lord Haskins suggests that local authorities and regional bodies should have a greater say and a greater role in delivering policies and guidance to rural business as a whole. However, I shall not be tempted, as the noble Baroness wishes, into suggesting a wholesale redistribution of resources between the east and west of the country, much as I might desire to do so. That is well beyond my remit.
Lord Carter:My Lords, will next week's Statement include an indication of how much will need to be done through primary legislation and, if so, what the likely timescale will be?
Lord Whitty:My Lords, my noble friend really should not ask me a question on the timescale of primary legislation. He is the last person to demand that from the Front Bench. Certainly the full creation of an integrated agency would, at some point, require primary legislation, but much can be done in advance of that.
Lord Renton of Mount Harry:My Lords, perhaps I may make a final point to the noble Lord. I fully understand that, in his position, he is bound to defend the decision to make the announcement on the last day that Parliament sits. However, does he accept that at

1247
present it looks as though there will inevitably be confusion between the different agencies over the next three years when no one knows precisely who is doing what? This comes at a particularly bad time when the interim review of the common agricultural policy is being implemented, and that is causing enough confusion and doubt in the agricultural industry already.
Lord Whitty:My Lords, I think that the agricultural sector is probably clearer than the noble Lord implied on the direction of change in agricultural policy. Nevertheless there are still details which require clarification and much of that will be done over the next few days and the summer.
The Haskins reforms do not impact on the nature of the CAP reform. They deliver broader measures of support, and to some extent guidance and regulation, to the rural industry as a whole, whereas the CAP reform is primarily about how we support financially land management and farming within this country. Dramatic changes are involved and the agricultural sector is fairly clear about what they are. As I said, the full details will be dealt with separately. However, the decisions on the Haskins report will be announced shortly. I do not think that we will have several months—certainly not years—of uncertainty as to who does what. I hope that clarity will be an objective of the announcement.

City Academies
3.11 p.m.
Baroness Sharp of Guildfordasked Her Majesty's Government:
Whether there is any evidence that city academy status will help regenerate failing inner-city schools.
Baroness Ashton of Upholland:My Lords, academies are addressing deep-seated and longstanding educational failure. It will take time for the new leadership, buildings and curriculum to turn things round. However, of the three academies with GCSE results in 2003, the number of 5A* to C grades rose in two to 21 per cent and 35 per cent respectively from 7 per cent and 25 per cent in 2002, and the other had results broadly comparable with its predecessor schools. Academies are also improving behaviour and attendance.
Baroness Sharp of Guildford:My Lords, I thank the Minister for her reply. Is she aware that in the evidence that he gave to the Select Committee last week, the Secretary of State admitted that with only 12 academies up and running, there was, in his own words, very little evidence to support the success or otherwise of such academies? Is she further aware that an evaluation is promised later this year on the 12 pilots that are up and running? Does she not agree that for a government who pride themselves on evidenced-based policy, it would
1248
have been sensible to await that evaluation before embarking on a £5 billion expansion programme of city academies?
Baroness Ashton of Upholland:My Lords, I believe that in my reply I agreed with the comments of my right honourable friend the Secretary of State. I gave the evidence to the noble Baroness as we have it. It is important that we have the PricewaterhouseCoopers review and evaluation, but children cannot wait. We have deliberately developed a policy of putting academies into areas of the country where we have the kind of deep-seated educational failure which means that what is offered to our children is simply not good enough. Here is a new mechanism which we believe could inspire greater leadership and better academic attainment and which is important for children now.
Lord Corbett of Castle Vale:My Lords, is my noble friend aware that Castle Vale School in Erdington, my former constituency in Birmingham, which a few years ago became a specialist performing arts college, is now one of the most successful schools among many successful schools in the City of Birmingham? That has been under the inspiring leadership of Mrs Janet Putman, who has been headteacher there for about 11 years and is now to retire. Will my noble friend join me in celebrating that success and agree that inspiring leadership and commitment among the management of any school, whatever is nailed to the front gate, is the key to success?
Baroness Ashton of Upholland:My Lords, I think that all noble Lords will join in the celebration of Mrs Putman's achievements with the school. Every survey that we or Ofsted have undertaken indicates that the quality and strength of leadership is one of the most critical factors in determining the success of a school. It is something to be celebrated and something that every school should have.
The Lord Bishop of Salisbury:My Lords, in view of the withdrawal of the partnership initiatives which have been promised to Church secondary schools, what will the Government offer the Churches in support of their continuing commitment to serving the inner cities' educational needs?
Baroness Ashton of Upholland:My Lords, that is slightly wide of the Question before me. The relationship between Church of England and Church schools and the way in which the Government take forward education policy is a critical factor. I am happy to pursue that with the right reverend Prelate and with the right reverend Prelate the Bishop of Portsmouth in his role as chairman of the Church of England Board of Education.
Baroness Miller of Chilthorne Domer:My Lords, I declare an interest as a Somerset county councillor, although I make it clear that Somerset has no failing schools. What is the rationale employed by the

1249
Government in enabling someone to take over, for a proportionately small sum of £2 million, a multimillion pound school building and a subsequent school running project, especially as it seems that it will be free from government control? What rationale are the Government following?
Baroness Ashton of Upholland:My Lords, that is not the most accurate description of the way the academies programme will work. I should be happy to give the noble Baroness a more lengthy description. This is about bringing in creative, entrepreneurial aspects to enable schools such as those I have indicated, which have had a succession of failure, to offer something different to help our children to succeed. There is a funding agreement—I have placed a copy in the Library of the House—to ensure that the Government play a key role in ensuring that such schools are run effectively and properly. The academies are inspected, and we have advisers working with them. We have very high aspirations and we expect them to achieve.
Baroness Seccombe:My Lords, have the Government received any representation on the effects of city academies on social deprivation in inner-city areas?
Baroness Ashton of Upholland:My Lords, I do not believe that we have had any representations. I shall write to the noble Baroness if I discover that we have. The academy programme is run in schools in areas of highest deprivation, and therefore provides a new asset for schools. The academies which are open and those which are about to open have received many applications from parents who wish their children to attend. We hope that the academies will succeed in providing a first-class education for our children.
Baroness Carnegy of Lour:My Lords, can the Minister confirm what I believe about city academies; that is, that the secret is not just setting free leadership but enabling the leadership of the school to set free the professionalism of staff in the school to run things in the way they want? I wonder whether the Minister is as sorry as I am that the Liberal Democrats are not keen on that.
Baroness Ashton of Upholland:My Lords, I understand all political views in your Lordships' House and I understand that people may feel nervous about something new in the system. However, we know that uniformity is not always the best approach for our children. We have some very good schools in our system and some excellent teachers. However, over the years some schools have consistently failed our students. We have to ensure that we bring to bear all of the best in our society to support them. The academy model is but one part of the toolkit available to the department to try to support children in all settings.

Private Finance Initiative: Contractor Insolvency
3.18 p.m.
Lord Newbyasked Her Majesty's Government:
What contingency plans they have for the continued provision of public services by a major private finance initiative contractor in the event that such contractor becomes insolvent.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey):My Lords, there are provisions included in PFI contracts that are specifically designed to safeguard the public sector against situations such as contractor insolvency. Where a private sector party cannot meet his obligations, it is the responsibility of other shareholders or credit providers to replace him. In the last resort, the Government have the right to terminate failing PFI contracts with substantial losses to the consortium concerned.
Lord Newby:My Lords, does the Minister agree that if a major PFI contractor such as Jarvis were to go under, some combination of government and other public bodies would have to pick up the pieces; for example to secure the completion of student halls of residence currently under construction for the next academic year? Does that not demonstrate that in reality the Government continue to bear much of the risks of those contracts?
Lord McIntosh of Haringey:No, my Lords. If Jarvis or any other contractor were to fail in its obligations, it is, as I said in my Answer, the responsibility of the other members of the consortium to, as the noble Lord said, pick up the pieces. Of the schools contracts which Jarvis has, only one is Jarvis alone. That is for only three schools and is worth £19 million. All the others have at least Barclays behind them. I do not think that the noble Lord, Lord Newby, will suggest that Barclays will not be able to take up the responsibilities which are imposed on it by the PFI contracts.
Lord St John of Bletso:My Lords, are not most PFI contracts through special purpose companies, which, if properly managed, should isolate 90 per cent of the problem if the contractor becomes insolvent?
Lord McIntosh of Haringey:Yes, my Lords. But it is not 90 per cent; it is 100 per cent. The worst that could happen is that if one member of a consortium became insolvent, there could be delays before the other members of the consortium took up his obligations, which they must do and which is in their interests. The purpose is that all the shareholders in a special purpose vehicle, to which the noble Lord, Lord St John, refers, have the incentives to complete on time and to adequate quality built in upfront in the contract.
Baroness Noakes:My Lords, given that the number of contractors involved in major PFI contracts is

1251
relatively small, do the Government have procedures for monitoring their financial health so as to be ahead of the game? If not, why not?
Lord McIntosh of Haringey:My Lords, value-for-money analyses are made. I see the point behind the question of the noble Baroness, Lady Noakes. It is true that in previous years we had a public sector comparator which was an assessment of the kind the noble Baroness seeks. But that was brought in rather late and therefore it was not the kind of evaluation for which she rightly asks. The value-for-money studies which are now carried out, and which continue to be carried out by the National Audit Office, give exactly the assurance the noble Baroness seeks.
Lord Oakeshott of Seagrove Bay:My Lords, in view of the widespread public concern about the financial position of Jarvis plc, can the Minister tell us what, on a look-through basis, is the total exposure of the public sector to Jarvis plc contracts?
Lord McIntosh of Haringey:My Lords, it would not be appropriate for me to comment from the Dispatch Box on the finances of Jarvis Plc. On the issue of public exposure, my answers have made it clear that the exposure is of the other members of the consortiums, rather than of the public sector.
Lord Bradshaw:My Lords, is the Minister really satisfied that the refinancing of PFI deals, which is quite common, amply safeguards the public sector, and that it receives a fair share of the better refinancing, which is available when a scheme is completed?
Lord McIntosh of Haringey:Yes, my Lords. The financing of a private finance initiative contract is a matter of legitimate risk. They are about risk management and those who undertake such contracts undertake a risk. If they can then lessen their risk by refinancing, it is legitimate that they should take some part of the benefit of that. But the contracts that have been in place since 2002 ensure that the public sector takes 50 per cent of the benefit of any refinancing.
Lord Selsdon:My Lords, how many PFI projects have been successfully completed and how many have failed? May I remind the Minister that the Government have done a good job because they have succeeded in what we would call "risk transfer"?
Lord McIntosh of Haringey:My Lords, I am grateful for the final remark of the noble Lord, Lord Selsdon. If I were to give the detailed answer to his question, I would keep the House for a very long time. The answers are available on the Treasury website.

Mental Health
3.23 p.m.
The Lord President of the Council (Baroness Amos):My Lords, I beg to move the Motion standing in my name on the Order Paper.
1252
Moved, That it is expedient that a Joint Committee of Lords and Commons be appointed to consider and report on any draft mental health Bill presented to both Houses by a Minister of the Crown, and that the committee should report on the draft Bill by the end of March 2005.—(Baroness Amos.)
Lord Renton:My Lords, I wonder whether the noble Baroness would be so good as to explain why Clause 217, Schedule 11 and Clauses 218 to 222—
Baroness Amos:My Lords, the noble Lord, Lord Renton, is asking about the next business on the Order Paper.
On Question, Motion agreed to; and a message was ordered to be sent to the Commons to acquaint them therewith.

Housing Bill
3.24 p.m.
The Minister of State, Office of the Deputy Prime Minister (Lord Rooker):My Lords, I beg to move the Motion standing in my name on the Order Paper.
Perhaps I can try and pre-empt the question of the noble Lord, Lord Renton. The Government are proposing this order for the sake of convenience. Since the Bill left the other place, and following discussions, we have announced considerable concessions such as the introduction of a tenancy deposit scheme. It will take time for parliamentary counsel to draft that provision. As the Bill will start its passage in this House next week but not finish its Committee stage until September or October, the Bill will have to be reordered. It is therefore convenient to consider the Bill in the proposed order and not to wait on parliamentary counsel to draft the provisions to which we have committed ourselves.
Moved, That it be an instruction to the Committee of the Whole House to which the Housing Bill has been committed that they consider the Bill in the following order:

Clauses 1 to 17,

Schedule 1,

Clauses 18 to 26,

Schedule 2,

Clauses 27 to 30,

Schedule 3,

Clauses 31 to 54,

Clause 217,

Schedule 11,

Clauses 218 to 222,

Clauses 55 to 66,

Schedule 4,

Clauses 67 to 70,

Schedule 5,

Clauses 71 to 115,

Schedule 6,

Clauses 116 to 148,

Schedule 7,

Clauses 149 to 155,

Clauses 157 to 167,

Clauses 172 to 182,

Clause 156,

Clauses 168 to 171,

Clauses 183 to 188,

Schedule 8,

Clauses 189 to 193,

Schedule 9,

Clause 194,

Schedule 10,

Clauses 195 to 216,

Clauses 223 to 226,

Schedule 12,

Clause 227,

Schedule 13,

Clauses 228 to 231.—(Lord Rooker.)

Lord Renton:My Lords, I thank the noble Lord for his explanation. However, taking clauses and schedules out of the order in which they appear in the Bill nearly always creates some confusion. It is much easier to take them in the order in which they appear in the Bill.
Lord Rooker:My Lords, it may be easier, but it is difficult to have proper scrutiny if the content of the clause is not in place when one reaches that point in the Bill. I pay tribute to the noble Lord's work on the conduct and proper design of legislation in the other place and his report of some 30 years ago, and I look forward to his contribution to our debates next week on the matters that we will have ready for debate. However, for good reasons which we have agreed across the House and with the other place, we will not be ready to deal with the concessions that we announced since the other place finished its consideration of the Bill.
On Question, Motion agreed to.

Weapons of Mass Destruction: Intelligence Review
3.26 p.m.
Baroness Amos:My Lords, I should like to repeat a Statement made in another place by my right honourable friend the Prime Minister. The Statement is as follows:
"Lord Butler's report is comprehensive, thorough; and I thank the members of his committee and their staff for all their hard work in compiling it. We accept fully the report's conclusions.
"The report provides an invaluable analysis of the general threat in respect of WMD; of the potential acquisition of WMD by terrorists; and though it devotes much of its analysis to Iraq, it also goes into detail on the WMD threat posed by Iran, Libya, North Korea and AQ Khan. Some of the intelligence disclosed is made available for the first time and gives some insight into the reasons for the judgments I and other Ministers have been making. I hope the House will understand if I deal with it in some detail.
1254
"The hallmark of the report is its balanced judgments. The report specifically supports the conclusions of Lord Hutton's inquiry about the good faith of the intelligence services and the Government in compiling the September 2002 dossier. But it also makes specific findings that the dossier and the intelligence behind it should have been better presented, had more caveats attached to it, and been better validated.
"It reports doubts which have recently arisen on the 45 minute intelligence and says in any event it should have been included in the dossier in different terms; but it expressly supports the intelligence on Iraq's attempts to procure uranium from Niger in respect of Iraq's nuclear ambitions.
"The report finds that there is little, if any, significant evidence of stockpiles of readily deployable weapons. But it also concludes that Saddam Hussein did indeed have: first,
'the strategic intention of resuming the pursuit of prohibited weapons programmes, including if possible its nuclear weapons programme, when United Nations inspection regimes were relaxed and sanctions were eroded or lifted';
secondly,
'in support of that goal, was carrying out illicit research and development, and procurement, activities, to seek to sustain its indigenous capabilities';
and, thirdly,
'was developing ballistic missiles with a range longer than permitted under relevant United Nations Security Council resolutions'.
"Throughout the last 18 months, throughout the rage and ferment of the debate over Iraq, there have essentially been two questions. One is an issue of good faith, of integrity.
"This is now the fourth exhaustive inquiry that has dealt with this issue. This report, like the Hutton inquiry. like the report of the Intelligence and Security Committee before it and of the Foreign Affairs Committee before that, has found the same thing.
"No one lied. No one made up the intelligence. No one inserted things into the dossier against the advice of the intelligence services. Everyone genuinely tried to do their best in good faith for the country in circumstances of acute difficulty. That issue of good faith should now be at an end.
"But there is another issue. We expected, I expected, to find actual usable, chemical or biological weapons shortly after we entered Iraq. We even made significant contingency plans in respect of their use against our troops. UN Resolution 1441 in November 2002 was passed unanimously by the whole Security Council, including Syria, on the basis that Iraq was a WMD threat.
"Lord Butler says in his report:
'We believe that it would be a rash person who asserted at this stage that evidence of Iraqi possession of stocks of biological or chemical agents, or even of banned missiles, does not exist or will never be found'.

1255
But I have to accept, as the months have passed, it seems increasingly clear that at the time of invasion Saddam did not have stockpiles of chemical or biological weapons ready to deploy.
"The second issue is therefore this: even if we acted in perfectly good faith, is it now the case that, in the absence of stockpiles of weapons ready to deploy, the threat was misconceived and therefore the war was unjustified?
"I have searched my conscience, not in a spirit of obstinacy but in genuine reconsideration in the light of what we now know, in answer to that question. And my answer would be this: that the evidence of Saddam's weapons of mass destruction was indeed less certain and less well founded than was stated at the time. But I cannot go from there to the opposite extreme. On any basis, he retained complete strategic intent on weapons of mass destruction and significant capability. The only reason he ever let the inspectors back into Iraq was that he had 180,000 US and British troops on his doorstep. He had no intention of ever co-operating fully with the inspectors; and he was going to start up again the moment the troops and the inspectors departed or the sanctions eroded. I say further that had we backed down in respect of Saddam, we would never have taken the stand that we needed to take on weapons of mass destruction, never have got the progress, for example, on Libya that we achieved and we would have left Saddam in charge of Iraq, with every malign intent and capability still in place and every dictator with the same intent everywhere immeasurably emboldened.
"As I shall say later, for any mistakes made, as this report finds, in good faith I of course take full responsibility, but I cannot honestly say that I believe getting rid of Saddam was a mistake at all. Iraq, the region and the wider world is a better and safer place without Saddam.
"The report begins by an assessment of intelligence and its use in respect of countries other than Iraq. It points out that, in respect of Libya, the intelligence has largely turned out to be accurate, especially in respect of its nuclear weapons programmes; and those are now being dismantled. In respect of Iran, the report says that Iran is now engaged with the International Atomic Energy Authority, though there remain,
'clearly outstanding issues about Iran's activities'.
"About North Korea the report concludes that it,
'is now thought to be developing missiles capable of delivering nuclear weapons as far away as continental US and Europe'.
The report goes on at paragraph 99:
'North Korea is a particular cause for concern because of its willingness to sell ballistic missiles to anyone prepared to pay in hard currency'.
The report also discloses the extent of the network of A Q Khan, the Pakistani former nuclear scientist. This network is now shut down, largely through US and UK intelligence work, Pakistani co-operation and the dialogue with Libya.
1256
"The report then reveals, for the first time, the development of the intelligence in respect of the new global terrorism that we face. In the early years, for example, in the Joint Intelligence Committee assessment of October 1994, the view was that the likelihood of terrorists acquiring or using chemical, biological or nuclear weapons was, while theoretically possible, highly unlikely.
"However, as the name and activities of Osama bin Laden became better known, the JIC started to change its assessment. In November 1998, it said this:
'[UBL] has a long-standing interest in the potential terrorist use of CBR materials, and recent intelligence suggest his ideas about using toxic materials are maturing and being developed in more detail … There is also secret reporting that he may have obtained some chemical and biological material—and that he is interested in nuclear materials'.
And in June 1999:
'Most of UBL's planned attacks would use conventional terrorist weapons. But he continues to seek chemical, biological, radiological and nuclear material and to develop a capability for its terrorist use'.
By mid-July 1999, this view hardened still further. Again, I quote:
'There have been important developments in [Islamist extremist] terrorism. It has become clear that Osama Bin Laden has been seeking chemical, biological, radiological, and nuclear materials … The significance of his possession of CB materials is that, in contrast to other terrorists interested in CB, he wishes to target US, British and other interests worldwide'.
A series of further assessments to the same effect was issued in January 2000, again in August 2000, and in January 2001.
"To anyone who wants to know why I have become increasingly focused on the link between terrorism and weapons of mass destruction, I recommend reading this part of the report and the intelligence assessments received. It was against this background of what one witness to Lord Butler called the 'creeping tide of proliferation' that the events of September 11 2001 should be considered. As the report says, quite rightly, following September 11 the calculus of the threat changed.
"I said in this House on 14 September 2001:
"we know that the terrorists would, if they could, go further and use chemical, biological or even nuclear weapons of mass destruction. We have been warned by the events of 11 September. We should act on the warning'.
"I took the view then, and I stand by it now, that no Prime Minister faced with this evidence could responsibly afford to ignore it. After September 11 it was time to take an active, as opposed to reactive, position on the whole question of weapons of mass destruction. We had to close down the capability of the rogue states, usually highly repressive and unstable, to develop such weapons and the commercial networks such as those of A Q Khan helping them. Again, my clear view was that the country where we had to take a stand was Iraq.
"Iraq was the one country to have used WMD recently. It had developed WMD capability and concealed it. Action by UN inspectors and the International Atomic Energy Authority had by the

1257
mid to late 1990s reduced this threat significantly; but, as the Butler report shows at paragraphs 180 to 182, by the time the inspectors were effectively blocked in Iraq (at the end of 1998) the intelligence assessments were that some CW stocks remained hidden and that Iraq remained capable of a breakout chemical weapons capability within months, a biological weapons capability, also with probable stockpiles, and could have had ballistic missiles capability in breach of UN resolutions within a year. This, of course, was the reason for military action, taken without a UN resolution, in December 1998.
"Subsequent to that, the report shows that we continued to receive the JIC assessments on Iraq's WMD capability. For example, in respect of chemical and biological weapons, in April 2000 it said:
"Our picture is limited. It is likely that Iraq is continuing to develop its offensive chemical warfare (CW) and biological warfare (BW) capabilities'.
"In May 2001, the JIC assessed, in respect of nuclear weapons:
'Our knowledge of developments in Iraq's WMD and ballistic missile programmes since Desert Fox air operations in December 1998 is patchy. But intelligence gives grounds for concern and suggests that Iraq is becoming bolder in conducting activities prohibited by UN Security Council Resolution 687. There is evidence of increased activity at Iraq's only remaining nuclear facility and a growing number of reports on possible nuclear related procurement'.
"In February 2002, the JIC said:
'Iraq … if it has not already done so, could produce significant quantities of BW agent within days'.
"The report specifically endorses the March 2002 advice to Ministers, which states that though containment had been partially successful and intelligence was patchy, Iraq continues to develop WMD. It said:
'Iraq has up to 20 650km range missiles left over from the Gulf War. These are capable of hitting Israel and the Gulf states. Design work for other ballistic missiles over the UN limit of 150km continues. Iraq continues with its BW and CW programmes and, if it has not already done so, could produce significant quantities of BW agents within days and CW agent within weeks of a decision to do so'.
"The report goes on:
'We believe it could deliver CBW by a variety of means, including in ballistic missile warheads. There are also some indications of a continuing nuclear programme'.
"The point I would make is simply this. The dossier of September 2002 did not reach any startling or radical conclusion. It said, in effect, what had been said for several years based not just on intelligence, but on frequent UN and international reports. It was the same conclusion, indeed, that led us to military action in 1998; to maintain sanctions; and to demand the return of UN inspectors.
"We published the dossier in response to the enormous parliamentary and press clamour. It was not, as has been described, the case for war, but it was the case for enforcing the United Nations' will. In retrospect, it has achieved a fame it never achieved at the time. As the report states at paragraph 310:
1258
'It is fair to say at the outset that the dossier attracted more attention after the war than it had done before it. When first published, it was regarded as cautious, and even dull. Some of the attention that it eventually received was the product of controversy over the Government's further dossier of February 2003'.
"It goes on to say:
'Some of it arose over subsequent allegations that the intelligence in the September dossier had knowingly been embellished, and hence over the good faith of the Government. Lord Hutton dismissed those allegations. We should record that we, too, have seen no evidence that would support any such allegations'.
"The report, at paragraph 333, states that in general the statements in the dossier reflected fairly the judgments of past JIC assessments. The report, however, goes on to say that, with hindsight, making public that the authorship of the dossier was by the JIC was a mistake. It meant that more weight was put on the intelligence than it could bear and put the JIC and its chairman in a difficult position.
"It recommends in future a clear delineation between government and JIC, perhaps by issuing two separate documents. I think that is wise, though I doubt it would have made much difference to the reception of the intelligence at the time. The report also enlarges on the criticisms of the ISC in respect of the greater use of caveats about intelligence both in the dossier and in my foreword, and we accept that entirely.
"The report also states that significant parts of the intelligence have now been found by SIS to be in doubt. The chief of SIS, Sir Richard Dearlove, has told me that the SIS accepts all the conclusions and recommendations of Lord Butler's report that concern the service. The SIS will fully address the recommendations that Lord Butler has made about its procedures and about the need for the service properly to resource them. The service has played, and will continue to play, a vital role in countering worldwide the tide of proliferation of weapons of mass destruction. Indeed, its successes are evident in Lord Butler's report.
"I accept the report's conclusions in full. Any mistakes made should not be laid at the door of our intelligence and security community. They do a tremendous job for our country. I accept full personal responsibility for the way the issue was presented and therefore for any errors that were made. As the report indicates, there is no doubt that at the time it was genuinely believed by everyone that Saddam had both strategic intent in respect of WMD and actual weapons.
"I make this further point. On the sparse, generalised and highly fragmented intelligence about Al'Qaeda prior to September 11, it is now widely said that policy-makers should have foreseen the attacks that materialised on September 11 2001 in New York. I only ask: had we ignored the specific intelligence about the threat from Iraq, backed up by a long history of international confrontation over it, and that threat later materialised, how would we then have been judged?

1259
"I know some will disagree with that. There are those who were opposed to the war, remain so now and will forever be in that position. I only hope that now, after two detailed parliamentary committee reports, a judicial inquiry more exhaustive than any has ever been in examining an allegation of impropriety against government, and now this voluminous report, people will not disrespect the other's point of view, but will accept that those who agree and those who disagree about the war in Iraq hold their views not because they are warmongers on the one hand, or closet supporters of Saddam on the other, but because of a genuine difference of judgment as to the right thing to have done.
"There was no conspiracy. There was no impropriety. The essential judgment and truth, as usual, does not lie in extremes. We all of us acknowledge Saddam was evil and his regime depraved. Whether or not actual stockpiles of weapons are found, there was not and is not any doubt that Saddam used weapons of mass destruction and retained every strategic intent to carry on developing them. The judgment is this: would it have been better or more practical to have contained him through continuing sanctions and weapons inspections; or was that inevitably going to be at some point a policy that failed? Was removing Saddam a diversion from pursuing the global terrorist threat, or part of it?
"I can honestly say that I have never had to make a harder judgment. But in the end, my judgment was that after September 11 we could no longer run the risk; that instead of waiting for the potential threat of terrorism and weapons of mass destruction to come together, we had to get out and get after it. One part was removing the training ground of Al'Qaeda in Afghanistan. The other was taking a stand on WMD; and the place to take that stand was in respect of Iraq, whose regime was the only one ever to have used weapons of mass destruction and was subject to 12 years of UN resolutions and weapons inspections that turned out to be unsatisfactory.
"Though in neither case was the nature of the regime the reason for conflict, it was decisive for me in the judgment as to the balance of risk for action or inaction. Both countries, Afghanistan and Iraq, now face an uncertain struggle for the future, but both at least now have a future. The one country in which you will find an overwhelming majority in favour of the removal of Saddam is Iraq.
"I am proud and remain proud; was proud and remain proud of this country and the part it played, especially our magnificent Armed Forces, in removing two vile dictatorships and giving people who were oppressed, almost enslaved, the prospect of democracy and liberty. This report will not end the arguments about the war, but in its balance and common sense it should at least help to set them in a more rational light; and for that we should be grateful".
My Lords, that concludes the Statement.
3.50 p.m.
Lord Strathclyde:My Lords, first, on behalf of the whole House, I thank the noble Baroness the Leader of the House for repeating the Statement.
It is a long Statement, and much of it deals with various generalities, as well, of course, as the outstanding performance of our troops and the justification for war. We agreed with the justification for the war, and we still agree with it. I reiterate our support for removing Saddam. However, the issue before us is not the war but the conduct of government and whether proper use was made of intelligence. I shall not respond to the rhetorical bulk of the Statement. Much of it smacked of the idea that the end justified the means. That is never a safe doctrine for a parliamentary democracy. The tragedy is that, although the Government had a good case for war, the way in which it was argued—as exposed, once again, in this outstanding report, which has found serious flaws in intelligence and its uses—has weakened that good case and damaged the credibility of the Prime Minister in the country.
I said that it was an outstanding report, and I pay tribute to the noble Lord, Lord Butler of Brockwell, and his committee for their work.
The report demonstrates unequivocally—the Prime Minister has accepted this—that the Prime Minister went, in his certainties, far beyond what the intelligence would bear. I shall give one example. On 21 August 2002, the JIC said:

"We have little intelligence … and know little about Iraq's chemical and biological weapons work since late 1998".
On 9 September 2002, it said, "Intelligence remains limited". That is what the JIC told the Prime Minister. However, in his foreword to the September dossier, the Prime Minister said:
"I am in no doubt that the threat is serious and current".
He also said that,
"the assessed intelligence has established beyond doubt … that Saddam has continued to produce chemical and biological weapons".
Can the noble Baroness explain the contrast? What led the Prime Minister so to alter the emphasis? Was he told to write that, or were they his own words, written in full knowledge of the caveats and conditions surrounding the intelligence?
The conclusion reached by the noble Lord, Lord Butler of Brockwell, is stark:
"it was a serious weakness that the JIC's warnings on the limitations of intelligence underlying its judgments were not made sufficiently clear".
Does the noble Baroness agree with that conclusion? The noble Lord suggested at his press conference this afternoon that the Government wanted the dossier as a document to back up their evolving policy. That put the JIC under what the noble Lord called "strain". He said that the 45-minute claim should not have been included in the dossier without qualifications. Can the noble Baroness tell the House who took the decision that it should be highlighted by the Prime Minister in that way? We were told time and again that the dossier

1261
attracted little attention. It is strange, then, that I am the only one who recalls the splashed headlines and the diagrams showing the great ballistic threat.
The Prime Minister has said that he did not know until later that Iraq did not have ballistic weapons. He said that he acted in good faith over the 45-minute claim. But he was preparing our forces for war. Why did he not know that the adversaries that they were being sent against did not have the capability that he had told the country they had? Did he not ask?
Like many others, I am concerned about the picture of government presented in the report and about the informal nature of this Government. There were meetings without papers and meetings without minutes or recorded conclusions. The noble Lord, Lord Butler of Brockwell, said that he had found no evidence of the Government planning to exaggerate the case for war. In such a context, is it possible that there may have been meetings and conversations of which no record was kept?
I turn finally to the role of the Attorney-General, the noble and learned Lord, Lord Goldsmith, who is in his place today. The noble Lord, Lord Butler of Brockwell, makes it clear that he did not examine the legal aspects of the noble and learned Lord's advice. How many opinions did the noble and learned Lord give? That matter remains obscure, even after the Butler report. Paragraph 374 says that, before Resolution 1441 was adopted, the noble and learned Lord the Attorney-General said:
"on the basis of the information he had seen, there would be no justification for the use of force against Iraq on grounds of self-defence against an imminent threat".
Later, we are told that the noble and learned Lord had a meeting with the Prime Minister's chief of staff and the noble Baroness, Lady Morgan of Huyton, about his view of the legal position. They asked him to provide a further assessment. According to paragraph 379, he said that, in the absence of a second UN resolution, the Prime Minister must be satisfied that Iraq failed to take the final opportunity to comply with Resolution 1441.
We read of a further meeting with the noble and learned Lord, Lord Falconer of Thoroton, who was not, at that time, Lord Chancellor, and the noble Baroness, Lady Morgan of Huyton, on 13 March and then a formal request from the Attorney-General's office for the Prime Minister to say that it was unequivocally his view that Iraq had committed further breaches. On 15 March, No. 10 Downing Street replied:
"It is indeed the Prime Minister's unequivocal view that Iraq is in further material breach of its material obligations".
In other words, it appears that the Prime Minister himself certified the legal case for war.
The noble Lord, Lord Butler of Brockwell, did not examine in detail the legal aspects of the case. Is there any reason, given the partial light thrown on this by the Butler report, why the noble and learned Lord the Attorney-General should not come to the House tomorrow and explain the full background of the paragraphs? In particular, can the noble Baroness tell
1262
the House whether the intelligence evidence played any part in the Attorney-General changing the advice that he gave to the Government between January and March? If the noble Baroness cannot answer that today, perhaps she would help to persuade the noble and learned Lord the Attorney-General to offer some clarification to the House tomorrow. I know that the whole House would find that most interesting and welcome.
3.57 p.m.
Baroness Williams of Crosby:My Lords, I too thank the noble Baroness the Leader of the House for repeating the Statement made in another place by the Prime Minister. I also congratulate the noble Lord, Lord Butler of Brockwell, on a detailed and careful report. However, I must add, with regret, that once again, as with the Hutton inquiry, the terms of the remit given to the noble Lord's inquiry were so tightly drawn that the key questions that the House would like answered could not be answered by the noble Lord, Lord Butler of Brockwell, if he stayed within his remit. The key questions remain. Who made the decision to propose to Parliament that we should go to war? Who decided that shaky intelligence should be strengthened and firmed up, with all the conditions and qualifications left behind? Those are the key questions, and the noble Lord, Lord Butler of Brockwell, was precluded from answering them, as the noble and learned Lord, Lord Hutton, was before him.
First, I must draw the attention of the House to the remarkable change in the Prime Minister's stance between November 2000 and the autumn of 2002, a mere two years later. On 1 November 2000, the Prime Minister said:
"We believe that the sanctions regime has effectively contained Saddam Hussein in the last 10 years".—[Official Report, Commons, 1/11/2000; col. 511W.]
A year and a half later—24 September 2002—the Prime Minister said:
"The policy of containment is not working".—[Official Report, Commons, 24/9/02; col. 3.]
Between those two dates, two major things occurred: there was a report by UNMOVIC, the inspectors in Iraq, and a report by Hans Blix, both confirming that the threat had become less and not more.
Paragraph 427 of the Butler report states:
"The Government's conclusion in the spring of 2002 that stronger action (although not necessarily military action) needed to be taken to enforce Iraqi disarmament was not based on any new development in the current intelligence picture on Iraq".
First, what happened between autumn 2000 and autumn 2002? There was no change in Iraq's threat to the world or any change in the policy of containment. But, quite simply, there was a meeting between the Prime Minister and President Bush, of which we have not been told and of which we know little; either when it occurred or what occurred during it. Surely, that meeting must have had some influence on the quite remarkable change in the position not just of the Government but the whole of the government machine.

1263
Secondly, would Parliament have taken us to war in March 2003 if it had known that the intelligence was based on uncertain sources; if it had known that that intelligence was assessed in a very doubtful way; if it had known that some of those statements made on behalf of the Government were exaggerated and that qualifications and modifications had been removed? It is clear from paragraph 555 and other parts of the Butler report that those qualifications had gone.
Would Parliament have agreed to take us to war if it had known, as the noble Lord, Lord Strathclyde, pointed out, that the Attorney-General produced new and revised advice on 17 March following an unequivocal assurance from the Prime Minister that Iraq was in material breach of Resolution 1441? Would Parliament have taken us to war if it had seen the assessments made by no less a body than the Joint Intelligence Committee? There was assessment after assessment between October 2002 and March 2003 indicating that Iraq was not a serious and current threat. There were reports that were never published, never shown to MPs and never shown to Parliament as a whole; reports that very clearly undermine the case for war.
Finally, we turn to the question of who is responsible—that illusive question that the inquiry conducted by the noble Lord, Lord Butler, was unable to address. Who is responsible? Was it the virtual government of Mr Jonathan Powell and Mr Alastair Campbell? Was it the intelligence community? Was it perhaps the elected politicians in Cabinet, including the Prime Minister, who are meant to be responsible for the major policy decisions?
We still have not been told. To me it is a tragedy that we will now wait yet again on the Senate of the United States to show the clear line of accountability between how that decision to go to war was taken and how, thousands of lives and much destruction later, we have still not seriously addressed the question.
4.3 p.m.
Baroness Amos:My Lords, first, perhaps I may say to the noble Lord, Lord Strathclyde, and the noble Baroness, Lady Williams, that I am aware that they did not have access to the report until 12.30 p.m. Some of what is being said today is, in my view, partial. A complete reading of the document demonstrates that the report is comprehensive, balanced and thorough. Some of the views that have been expressed by the noble Lord, Lord Strathclyde, and the noble Baroness, Lady Williams, are not borne out by a thorough reading of the report. I would recommend to all Members of this House that they read the report from beginning to end.
With respect to the question raised by the noble Baroness, Lady Williams, in relation to the intelligence material and what had changed, the noble Baroness is well aware of what changed. The context in which we discussed those issues changed fundamentally after September 11. The Statement makes that absolutely clear. Indeed, a reading of the report and, in particular, the intelligence material in relation to that period
1264
makes that absolutely clear, as does the knowledge that terrorists were doing everything that they could to get hold of WMD. Again, that is factually borne out by the report.
The report and the Statement have tried absolutely clearly to put the discussions and decisions that were made in relation to Iraq in their proper context. That is something of which we should all be aware and something that we should all remember to do.
With respect to the issue of the legal basis for the war, I think that my noble and learned friend the Attorney-General has answered the questions that were asked of him in relation to that. I hope that in again asking those questions the integrity of my noble and learned friend was not being called into question.
To help the House, perhaps I may repeat where we stand. In the report, it is made very clear that the advice of my noble and learned friend was not based on WMD-related intelligence. I would direct noble Lords to paragraph 379 of the report. My noble and learned friend confirmed in this House, including on 21 March when he explained his view to the House, that it was his independent view that military action was justified.
The Butler report confirms, as my noble and learned friend has always maintained, that his advice, which the noble Lord's review saw, was based on the interpretation of relevant Security Council resolutions and negotiating history in the United Nations and, I repeat, not on WMD-related intelligence. So the lawfulness of the conflict is not undermined by the failure to find WMD or by any reassessment of the intelligence. It could not be clearer.
A question was also raised with respect to the use that was made of the dossier. When noble Lords look at the report in detail, I invite them to read the footnote on page 127 where the inquiry team makes it clear that it,
"wrote to some 60 Editors of national and regional print and broadcast media to ask them if they had been briefed by representatives of the Government about the dossier immediately prior to its publication or whether, post-publication, they were guided to report particular aspects, such as the '45 minute' story. All of those who replied said that they had not been guided to particular parts of the dossier prior to its publication … Some Editors noted that the '45 minute' story attracted attention because it was of itself an eyecatching item in a document containing much that was either not new or rather technical in nature".
Perhaps I may say to the noble Baroness, Lady Williams, that on 26 September 2002, in the Western Morning News, the Leader of the Liberal Democrats in another place, said:
"There is no killer fact in the dossier. It is more a confirmation of what we already knew".
Again, before the dossier was published, on 23 March 2002 the shadow Foreign Secretary said:
"The Iraqi threat is indisputable. Horrific weapons of mass destruction in the hands of a despot who will use them or give them to others to use in every part of the world. Our shared objective is the destruction of these weapons before they can be used. The means of achieving it must be effective and enduring. We cannot rule any option out".

1265
In conclusion, with regard to the comments which have been made about the nature of government, the so-called informality of the Government, and the fact that meetings are held which are not minuted, we all know that if you are to have effective government, you need to operate in a variety of different ways. Those noble Lords opposite who may remember a time when they were in government might recall occasions when it was necessary to hold informal meetings before they then had formal meetings.
I say this to the House: the Butler report makes it absolutely clear that the Cabinet discussed these issues on 24 occasions. As noble Lords know, the Cabinet is always minuted.
4.6 p.m.
Lord Lawson of Blaby:My Lords, this is a sorry occasion. Reverting to the last reply given by the noble Baroness the Leader of the House, I am among those who have been in government and served in a Cabinet for a considerable time. I can say that the strictures—which they are, albeit in restrained terms—made in the Butler report at paragraphs 6.06 to 6.11, although not exclusively there, on the way that this administration conducts the procedures and processes of government is something that did not apply to any administration in which I have served.
I ask the noble Baroness whether she is aware that this is a serious matter. Throughout the over-long Statement of the Prime Minister, repeated by the noble Baroness, there was no acknowledgment of that whatever. When is this very important issue going to be addressed, and how?
Baroness Amos:My Lords, perhaps the noble Lord did not hear everything I said in the Statement, where it was made absolutely clear that we accept the report and the recommendations made in it. Perhaps I may also say to the noble Lord that at his press conference this morning the noble Lord, Lord Butler, was asked a specific question about the style of government. I watched it. The noble Lord said that the overall effect of the way the Government operated in no way made them any less efficient. Noble Lords should read what is in the report and listen to the words of the noble Lord, Lord Butler.
Lord Wright of Richmond:Lord Wright of Richmond: My Lords—
Lord Archer of Sandwell:Lord Archer of Sandwell: My Lords—
Baroness Crawley:Baroness Crawley: My Lords, there is plenty of time for everyone to speak.
Lord Archer of Sandwell:My Lords, I declare an interest as a member of the Intelligence and Security Committee. Can my noble friend confirm that the only substantive criticism of the dossier made in the report is that it failed adequately to emphasise, for the benefit of those who did not already know, that intelligence by its very nature is incomplete and frequently tentative? Can
1266
she further confirm that this is the first occasion ever on which a government have made public information from the JIC? Would it not be surprising if this first attempt at transparency did not give rise to some lessons?
Baroness Amos:My Lords, my noble and learned friend is absolutely right. Perhaps I may say in relation to his final point about transparency that, having watched governments operate over many years, no government have sought to be as transparent and as open with their people as this Government have sought to be.
Lord Wright of Richmond:My Lords, I have not yet had the opportunity to read the Butler report in full, but as a former chairman of the Joint Intelligence Committee and as a Member of this House who has strongly questioned and still questions the case for going to war in Iraq, I should like to make a few brief points.
First, it is quite clear from what I have read of the Butler report that the process of assessing and publicising intelligence in the case of Iraqi weapons of mass destruction, and therefore of the imminence of an Iraqi threat, was flawed.
Secondly, the role and involvement of political advisers and No. 10 press officers in the process of intelligence assessment and in producing the flawed dossier was unwise and led to pressure, perhaps unconscious pressure or strain, on the intelligence services to support the case for war. I am surprised that neither the noble and learned Lord, Lord Hutton, nor, so far as I know, the noble Lord, Lord Butler, has drawn particular attention to Mr Jonathan Powell's e-mail, in which he is reported to have complained that the first draft of the dossier was inadequate to support the Government's case for going to war.
Thirdly, this House was repeatedly assured by Ministers that no decisions to go to war had been taken. Indeed, I was assured privately by a Minister, within weeks of military action, that we would not go to war without a second United Nations resolution. But it has long been clear from Bob Woodward's books, as I have reminded this House several times, that a decision had been taken by senior members of the United States Administration as early as four years ago, if not earlier, that an early and imminent invasion of Iraq was desirable and necessary, and that the events of September 11 in the following year were used improperly and dishonestly as a justification for going to war.
Little attempt has been made either by the United States Government or by the British Government to correct the widespread belief in the United States that Saddam Hussein was behind the attack on the twin towers. I share the regret expressed by the noble Lord, Lord Strathclyde, that the Attorney-General's confidential advice has still not been published, when a great deal of information has been revealed which in my day would have been—
Baroness Crawley:My Lords, perhaps the noble Lord, Lord Wright, could frame a question.
Lord Wright of Richmond:My Lords, I beg the pardon of the House. I do not deny that Iraq may now

1267
be a better place without Saddam, but let us not forget that the removal of Saddam was never given by Her Majesty's Government as the justification for war. On the contrary, we were told again and again that it was not the policy of Her Majesty's Government to change other people's governments. Is that still the policy of Her Majesty's Government?
Baroness Amos:My Lords, the noble Lord, Lord Wright, is correct. What the report does is to flag up places where the process is flawed. In his press report, the noble Lord, Lord Butler, spoke of the 45 minutes claim, saying that it was an uncharacteristically poor piece of assessment. The report makes it absolutely clear that there are some flaws in the process, that these need to be addressed urgently and that there is a great deal of learning to be done within that. The report goes into a great deal of detail. The four case studies used at the beginning of the report—in particular in relation to Iran, AQ Khan, Libya and North Korea—establish the context in which this work was being developed.
I cannot accept the point made by the noble Lord, Lord Wright, as regards pressure being put on the intelligence community or on the Joint Intelligence Committee, and the Butler report is absolutely clear on that point.
Turning to the issue of the second UN resolution, at the time I was myself a Minister at the Foreign Office. We worked assiduously to get a second UN resolution, but it was absolutely clear that a resolution which contained within it any kind of ultimatum with respect to the length of time that was going to be available to Iraq would not pass. That was the point at which our strategy needed to be revised.
Baroness Ramsay of Cartvale:My Lords, will my noble friend the Leader of the House join me in welcoming this very comprehensive and good report from the noble Lord, Lord Butler? In particular, will she join me in welcoming the fact that there was nothing in respect of this report which calls into question the legality of the war?
I draw attention to the fact that in paragraph 379 the report recognises that the Attorney-General's advice was,
"based on the legal interpretation of relevant United Nations Security Council resolutions and negotiating history in the United Nations, and not on WMD-related intelligence".
If the violation of 16 Chapter 7 UN resolutions is not legal justification for military action, I do not know what is.
Does my noble friend agree that, although the report found deficiencies in the validation process of some Iraqi intelligence, the fact that it concluded that the four case studies made of Libya, Iran, North Korea and AQ Khan were all success stories for the SIS demonstrates that the doubts cast on the overall efficiency and performance of the SIS are misplaced? Certainly that is not the opinion of the report.
Baroness Amos:My Lords, my noble friend is right. The report points clearly to the four success stories
1268
used as case studies. My noble friend is also right to point the House in the direction of recognising the professionalism and good work of our intelligence services.
Let me remind the House of UN Security Council Resolution 1441. It decided that,
"Iraq has been and remains in material breach of its obligations under relevant resolutions, including resolution 687 (1991), in particular through Iraq's failure to cooperate with United Nations inspectors and the IAEA, and to complete the actions required under paragraphs 8 to 13".
That resolution was passed unanimously by the Security Council.
My noble friend Lady Ramsay is quite right to say that the report in no way calls into question the legality of the war. Paragraph 379 sets out absolutely clearly the basis on which my noble and learned friend the Attorney-General gave advice.
The Lord Bishop of Salisbury: My Lords, if I am right about what the Minister said, the Prime Minister is quoted as saying,
"For my mistakes, I take full responsibility".
In a case such as this, where a considerable amount of damage has been done to our credibility as a country in terms of truth telling and the public accountability of our institutions, it is quite important to have those words in the report. There clearly is more to be learnt; I hope that in due course we shall have answers to some of the questions raised by the noble Lord, Lord Strathclyde, and the noble Baroness, Lady Williams.
However, at a fundamental level, it is most important that the House should hear unequivocal answers to major questions about the order in which events took place; just where people changed their minds and just where the Prime Minister was responding to invitations, not only from within our own intelligence services but from other parts of the world, to change his mind. I think it is always helpful if people can be persuaded to say whether they are going to change their minds. Can the Minister tell the House just when any of these changes of mind took place?
Baroness Amos:My Lords, as has been said by myself and my noble friend Lady Symons on many occasions when answering questions on Iraq, we are well aware that there are differing points of view about the war. It has been made absolutely clear in the Statement that we need to respect the fact that people come to this issue from different positions. We have now had four reports and everyone is looking for something to answer the questions that they have in their minds which they feel have not been answered by the Hutton report, by the Butler report, by the ISC report or by the report of the Foreign Affairs Select Committee.
It is clear from all four reports that there are lessons that the Government need to learn and take on board but, as regards the questions that have been raised about the integrity and honesty of the Government in respect of the case that we made to go to war in Iraq,

1269
it is absolutely clear that the Prime Minister and the Government acted with integrity. The Butler report and the Hutton report make that absolutely clear and the question was not raised in the parliamentary committee reports. When will the House and those who did not agree with the action that was taken accept that fact?
Lord Garden:My Lords, does the Leader of the House accept that, while we do not necessarily question integrity, we do question judgment? There is now an excellent report from the noble Lord, Lord Butler, which shows that containment in March 2003 was operating satisfactorily; Iraq was not at that time a threat to the United Kingdom, its citizens or even to the region. And yet we sent everything we had—
Baroness Gibson of Market Rasen:Baroness Gibson of Market Rasen: My Lords, I really do feel—
Noble Lords:Noble Lords: Order!
Lord Garden:My Lords, we sent 43,000 of our soldiers, sailors and airmen to kill or be killed into—
Baroness Gibson of Market Rasen:Baroness Gibson of Market Rasen: My Lords—
Noble Lords:Noble Lords: Order!
Baroness Gibson of Market Rasen:My Lords, noble Lords do intervene. I feel strongly about this issue.
Baroness Crawley:My Lords, as the House will know, it is absolutely in order to make a brief comment, followed by a question or a number of questions. I am sure that we shall be as brief as we can be.
Lord Garden:My Lords, we sent 43,000 troops to kill or be killed and yet the report makes it clear that we did not look again at the intelligence when Hans Blix was in the country and able to give us up-to-date information. Does the Minister think that we should have reassessed the intelligence before the eleventh hour in March 2003?
Baroness Amos:My Lords, the noble Lord will be aware that the JIC makes reassessments of its intelligence all the time. That is the way in which it operates. As to the wider question raised by the noble Lord, I draw his attention to paragraph 474 on page 116 of the report, which refers to the validation of the intelligence. The report states:
"we have reached the conclusion that prior to the war the Iraqi regime … Had the strategic intention of resuming the pursuit of prohibited weapons programmes, including if possible its nuclear weapons programme, when United Nations inspection regimes were relaxed and sanctions were eroded or lifted … In support of that goal, was carrying out illicit research and development … Was developing ballistic missiles with a range longer than permitted under relevant United Nations Security Council resolutions".
1270
That is the conclusion of the Butler report on the validation of intelligence.
Lord Judd:My Lords, does my noble friend agree that paragraph 584 of this excellent report deserves careful consideration? It states that,
"much of what was reliably known about Iraq's unconventional weapons programmes in the mid- and late-1990s was obtained through the reports of the UN Special Commission (UNSCOM) and of the International Atomic Energy Agency".
That paragraph goes on to say that the work of those agencies has perhaps been underestimated in the past and that due weight should be given to it in future. More support should be given to them with the support of our intelligence agencies. Does not my noble friend agree that that paragraph gives ground for considerable reflection on just how seriously we took the work of Hans Blix and the UN inspectors at the time or how far, rather, we chose to push it to one side because of our own priorities in government?
Baroness Amos:My Lords, I agree with one part of my noble friend's comment, but not with the other. I entirely agree with him about the importance of the UN mechanisms. The Government have always upheld them. However, I must tell my noble friend, with respect to the judgment made about containment, that it was at the time and remains our firm view—indeed, in the light of the paragraph from the Butler report that I cited about the validation of intelligence, it is clear—that containment was not working. Concern was being expressed not just by our Government or by that of the United States but by others around the world about what Saddam Hussein intended to do. In that respect, I do not agree with my noble friend.
Lord King of Bridgwater:My Lords, does not the noble Baroness recognise that her plea for the matter now to be closed will simply not be recognised by the general public, especially because of the limited, restricted terms of reference, to which the noble Lord, Lord Butler, properly stuck? I did not hear a clear answer to my noble friend's question from the Front Bench about whether the Attorney-General would come to make a statement on the matter. The noble Lord, Lord Butler, made clear that he had not pursued that matter; the committee did not consider the question of the legality of the war. Likewise, the role of government was likewise more circumscribed in the terms of reference.
Even given his limited terms of reference, the noble Lord, Lord Butler, found that there were serious failings for which there was collective responsibility. Who takes collective responsibility in this Government?
Baroness Amos:My Lords, first, I think that the noble Lord, Lord King, cannot have heard what I said. I in no way said that the issue is closed. I said that those who had not been in favour of action—indeed, even some of those who had been in favour of action—wanted any number of inquiries to address the particular points that they considered relevant, which

1271
they did not consider had been answered in the reports. The reports have collectively made it absolutely clear that in no sense did the Government act in bad faith. So those who are looking for some kind of ammunition will not find it. I did not say that the case is closed. I said that there have been four reports on the issue and that at some point we have to agree, when considering what has been said collectively through the reports, that the questions raised have been addressed.
I think that we have addressed the specific point about my noble and learned friend the Attorney-General. My noble and learned friend made a written Statement. My right honourable friend the Secretary of State for Foreign and Commonwealth Affairs elaborated on that Statement in another place, and that was repeated in this House. There will not be a further Statement from my noble and learned friend.

Asylum and Immigration (Treatment of Claimants, etc.) Bill
4.34 p.m.
Lord Filkin:My Lords, I beg to move that the Commons amendments be now considered.
Moved accordingly, and, on Question, Motion agreed to.

COMMONS AMENDMENTS
[The page and line references are to HL Bill 36, the Bill as first printed for the Lords.]

LORDS AMENDMENT
28 Clause 14, page 13, line 22, leave out subsections (6) and (7) and insert—
"(6) Before section 104 of that Act (pending appeal) insert—

103A Review of Tribunal's decision
A party to an appeal under section 82 or 83 may apply to the appropriate court, on the grounds that the Tribunal made an error of law, for an order requiring the Tribunal to reconsider its decision on the appeal.

The appropriate court may make an order under subsection (1)—

only if it thinks that the Tribunal may have made an error of law, and

only once in relation to an appeal.

An application under subsection (1) must be made—

in the case of an application by the appellant made while he is in the United Kingdom, within the period of 10 working days beginning with the date on which he is treated, in accordance with rules under section 106, as receiving notice of the Tribunal's decision, and

in the case of an application by the appellant made while he is outside the United Kingdom, within the period of 28 days beginning with the date on which he is treated, in accordance with rules under section 106, as receiving notice of the Tribunal's decision, and

1272

in the case of an application brought by a party to the appeal other than the appellant, within the period of 10 working days beginning with the date on which he is treated, in accordance with rules under section 106, as receiving notice of the Tribunal's decision.

But—

rules of court may specify days to be disregarded in applying subsection (3)(a), (b) or (c), and

the appropriate court may permit an application under subsection (1) to be made outside the period specified in subsection (3) where it thinks that the application could not reasonably practicably have been made within that period.

An application under subsection (1) shall be determined by reference only to written submissions of the applicant.

A decision of the appropriate court on an application under subsection (1) shall be final.

In this section a reference to the Tribunal's decision on an appeal does not include a reference to—

a procedural, ancillary or preliminary decision, or

a decision following remittal under section 103B, 103C or 103E.

This section does not apply to a decision of the Tribunal where its jurisdiction is exercised by three or more members.

In this section "the appropriate court" means—

in relation to an appeal decided in England or Wales, the High Court,

in relation to an appeal decided in Scotland, the Court of Session, and

in relation to an appeal decided in Northern Ireland, the High Court in Northern Ireland.

An application under subsection (1) to the Court of Session shall be to the Outer House.

103B Appeal from Tribunal following reconsideration
Where an appeal to the Tribunal has been reconsidered, a party to the appeal may bring a further appeal on a point of law to the appropriate appellate court.

In subsection (1) the reference to reconsideration is to reconsideration pursuant to—

an order under section 103A(1), or

remittal to the Tribunal under this section or under section 103C or 103E.

An appeal under subsection (1) may be brought only with the permission of—

the Tribunal, or

if the Tribunal refuses permission, the appropriate appellate court.

On an appeal under subsection (1) the appropriate appellate court may—

affirm the Tribunal's decision;

make any decision which the Tribunal could have made;

remit the case to the Tribunal;

affirm a direction under section 87;

vary a direction under section 87;

give a direction which the Tribunal could have given under section 87.

1273

In this section "the appropriate appellate court" means—

in relation to an appeal decided in England or Wales, the Court of Appeal,

in relation to an appeal decided in Scotland, the Court of Session, and

in relation to an appeal decided in Northern Ireland, the Court of Appeal in Northern Ireland.

An appeal under subsection (1) to the Court of Session shall be to the Inner House.

103C Appeal from Tribunal instead of reconsideration
On an application under section 103A in respect of an appeal the appropriate court, if it thinks the appeal raises a question of law of such importance that it should be decided by the appropriate appellate court, may refer the appeal to that court.

On a reference under subsection (I) the appropriate appellate court may—

affirm the Tribunal's decision;

make any decision which the Tribunal could have made;

remit the case to the Tribunal;

affirm a direction under section 87;

vary a direction under section 87;

give a direction which the Tribunal could have given under section 87;

restore the application under section 103A to the appropriate court.

In this section—
"the appropriate court" has the same meaning as in section 103A, and
"the appropriate appellate court" has the same meaning as in section 103B.

A reference under subsection (1) to the Court of Session shall be to the Inner House.

103D Reconsideration: legal aid
Subsection (2) applies where the appropriate court has made an order under section 103A(1), or a reference under section 103C(1), on the application of an appellant under section 103A.

The appropriate court may order that the appellant's costs in respect of the application under section 103A shall be paid out of the Community Legal Service Fund established under section 5 of the Access to Justice Act 1999 (c. 22).

Subsection (4) applies where the Tribunal has decided an appeal following reconsideration pursuant to an order made—

under section 103A(1), and

on the application of the appellant.

The Tribunal may order that the appellant's costs—

in respect of the application for reconsideration, and

in respect of the reconsideration, shall be paid out of that Fund.

The Secretary of State may make regulations about the exercise of the powers in subsections (2) and (4).

1274

Regulations under subsection (3) may, in particular, make provision—

specifying or providing for the determination of the amount of payments (which may, in particular, vary according to the result of the reconsideration or of the reference under section 103C);

about the persons to whom the payments are to be made;

restricting the exercise of the power (whether by reference to the outcome of the appeal, the circumstances of the appellant, the nature of the appellant's legal representatives, or otherwise).

Regulations under subsection (3) may make provision—

conferring a function on the Legal Services Commission;

modifying a duty or power of the Legal Services Commission in respect of compliance with orders under subsection (2);

applying (with or without modifications), modifying or disapplying a provision of, or of anything done under, an enactment relating to the funding of legal services.

Before making regulations under subsection (3) the Secretary of State shall consult such persons as he thinks appropriate.

This section has effect only in relation to an appeal decided in—

England,

Wales, or

Northern Ireland.

In relation to an appeal decided in Northern Ireland this section shall have effect—

as if a reference to the Community Legal Service Fund were to the fund established under paragraph 4(2)(a) of Schedule 3 to the Access to Justice (Northern Ireland) Order 2003 (S.I. 2003/435 (N.I. 10)), and

with any other necessary modifications.

103E Appeal from Tribunal sitting as panel
This section applies to a decision of the Tribunal on an appeal under section 82 or 83 where its jurisdiction is exercised by three or more legally qualified members.

A party to the appeal may bring a further appeal on a point of law to the appropriate appellate court.

An appeal under subsection (2) may be brought only with the permission of—

the Tribunal, or

if the Tribunal refuses permission, the appropriate appellate court.

On an appeal under subsection (2) the appropriate appellate court may—

affirm the Tribunal's decision;

make any decision which the Tribunal could have made;

remit the case to the Tribunal;

affirm a direction under section 87;

vary a direction under section 87;

give a direction which the Tribunal could have given under section 87.

In this section "the appropriate appellate court" means—

in relation to an appeal decided in England or Wales, the Court of Appeal,

1275

in relation to an appeal decided in Scotland. the Court of Session, and

in relation to an appeal decided in Northern Ireland, the Court of Appeal in Northern Ireland.

A further appeal under subsection (2) to the Court of Session shall be to the Inner House.

In this section a reference to the Tribunal's decision on an appeal does not include a reference to—

a procedural, ancillary or preliminary decision, or

a decision following remittal under section 103B or 103C."

The Commons agree to this amendment with the following amendments—
28A Line 14, leave out "10 working" and insert "5"
28B Line 24, leave out "10 working" and insert "5"
28C Line 36, after "to", insert—
"(a)"
28D Line 36, at end insert—
", and
(b) where rules of court permit, other written submissions."
28E Line 45, after "more", insert "legally qualified"
28F Line 131, leave out from "payments" to end of line 133
28G Line 136, leave out "the outcome of the appeal," and insert "the prospects of success in respect of the appeal at the time when the application for reconsideration was made, the fact that a reference has been made under section 103C(1),"
Lord Filkin:My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 28A to Lords Amendment No. 28. I shall speak also to Lords Amendment No. 62 and Commons Amendment No. 62A thereto, which cover substantially the same ground, as well as Amendments Nos. 28AA, 28BA and 62B in the name of the noble Lord, Lord Goodhart.
When I refer to the High Court, I am also referring to the High Court of Northern Ireland and the Court of Session in Scotland.
We are at that stage of our parliamentary process where we are hopefully approaching the end of consideration of the Bill. Let no one allege that the Government have not listened and reflected on what the House has said. My noble and learned friend the Lord Chancellor gave serious reflection to the arguments made in the House about the judicial review ouster and came back with an alternative which, in broad measure, the House has welcomed. Secondly, we previously considered the issue of legal aid success fees. I gave the noble Lord, Lord Kingsland, my undertaking that, within the terms in which he had put the issue to me, I would take the issue away and seek to address it in another place. I hope that he will find that we have done so.
The noble Lord will also know from Commons consideration that we also considered the issue of lay members, which we did not rejoice about, but we also listened to the House in that respect. So the House has been listened to, but we have not been persuaded by the House about this measure.
1276
New Section 103A in Amendment No. 28 allows a party to the appeal before the Asylum and Immigration Tribunal to seek a review of the tribunal's decision in the High Court, on the grounds that the tribunal may have made an error of law. The High Court may order the tribunal to reconsider the case. As those who have been following the Bill closely will know, there is also an interim process, a filter process—because there may be a large volume of such applications to the tribunal—whereby, if the transitional process in Amendment No. 62 is in place, the review will first be considered by a senior judge in the tribunal. He may also make an order for reconsideration of the case. If he chooses not to, the applicant may opt in for the case to be considered by the High Court anyway.
Amendments Nos. 28A, 28B and 62A restore the Government's intention that five-day time limits should apply to that process, both for the initial application, and the opting in, if the transitional filter process is in place—in the circumstances I just described.
The Bill originally contained an ouster of the jurisdiction of the higher courts. Having listened to opinions, we brought forward the new policy in Amendment No. 28. Under the new policy, the decisions of the single-tier tribunal are now subject to review in the High Court. We agree that it is important that the High Court has such oversight, but we cannot allow that to compromise our legitimate aims of speed and efficiency. Therefore, it is vital that limits are placed on the review to prevent applicants without meritorious cases using the process to cause delay and expense. One of those limits is the new system of legal aid for reviews, to which we shall return later, and another is the limit on the time in which an application can be made.
The Government are confident that five days is more than enough for an applicant to consult their legal representative, for the representative to prepare the application and for the application to be lodged. Similarly, five days is also entirely sufficient for the simple procedure of opting to have a review application considered by the High Court under the transitional provisions.
For the avoidance of doubt, five days means five working days—weekends and bank holidays are excluded. That does not need to be spelt out in the Bill, although new Section 103A(4)(a) points to the fact that that effect is already achieved by rules. I should also point out that after the decision is promulgated by the tribunal, two days are allowed for the determination to reach the representative through the post before the five days starts. Therefore, we are talking about five full days for the representative to work on the application.
The time limits in Amendments Nos. 28A and 28B apply when a party to the appeal wants to challenge the decision of the asylum and immigration tribunal. The applicant will therefore have already presented his case to the Immigration and Nationality Directorate and before an independent tribunal before reaching that stage. The grounds of appeal will already have been covered at the appeal and in the tribunal's statement of

1277
reasons. Furthermore, that review is not a rehearing, but is focused solely on errors of law made by the tribunal. Given that the legal representative will, in most cases, already be familiar with the case, the preparation for it should not prove onerous.
In order to test the assertion, and to test the realism of what we are putting before the House, we have asked the Legal Services Commission to look at the current statutory review process under Section 101 of the Nationality, Immigration and Asylum Act 2002. Based on this, we have looked at what, in practice, have been the submissions made by lawyers as part of the statutory review process. I have inspected some of those cases and solicitors have not always been—how shall I put it?—very fulsome in terms of the cases they have put forward. We would expect them to do around six hours' work on a review application, including reading through the papers, interviewing the client, taking instructions and, if necessary, briefing counsel. Counsel is not always briefed in such cases; if counsel is involved, he could be expected to take between two and five hours to draft the application. We are therefore talking about six hours for the solicitor and up to five hours for counsel. That is very achievable in five working days.
Of course, there will always be exceptions. We have made it clear from the outset that we would not want to see this lead to injustice. Therefore, Section 103A(4)(b) explicitly allows the High Court to accept out-of-time applications,
"where it thinks that the application could not reasonably practicably have been made within that period".
This will deal with all the exceptional circumstances—for example, if the usual legal representative of the applicant was unwell and unable to complete the application in time, or if specialist evidence needed to be collated to present a full review application. This will work by the applicant applying out of time and the High Court exercising its discretion to allow the out-of-time application.
Put at its simplest, we are confident that five days is adequate in the majority of cases. The legislation explicitly allows the High Court judge, who will clearly be charged with upholding the interests of justice, to grant further time when the case is put to him and he considers that that case could not reasonably practicably have been made within that period. The legislation could not be clearer or, we believe, fairer.
It would be even more absurd to allow more than five days for "opting in" under the transitional filter process. I do not want to bore the House with the detail, but this is essentially when a case has been considered by a senior judge in the AIT on a review application and has been found not to be valid. At that point, the applicant still has the further right to lodge a case to the High Court, but this will require little more than a fax or a letter to be sent to the High Court, indicating that the applicant wishes his case to be considered again, following consideration by a judge in the tribunal. That could be done in half an hour, so five days is somewhat generous.
1278
Why does all this matter? As I have set out on previous discussions on the Bill, it is important that we have a process that is no slower than necessary in the interests of justice. It is important that we send a message that this review process is for obvious errors of law, and not to allow legal representatives to trawl through obscure legal arguments and technicalities. And we will send that message clearly if we make sure that the opportunities for causing delay are minimised.
For these reasons, and not out of any stubbornness or obduracy—I hope that noble Lords will agree that we have exhibited neither characteristic in this House on the Bill—we do not think that there is any justifiable reason for resisting the views of the other place twice that five days is perfectly sufficient for either of these circumstances and, moreover, that that five-day period is protected by the direct discretion given to a High Court judge to grant more time when he thinks it was not reasonably practicable to put in an appeal in that case. What more, fairly, should be done? I ask the House not to resist the Commons amendment in this respect.
Moved, That the House do agree with the Commons in their Amendment No. 28A to Lords Amendment No. 28.—(Lord Filkin.)
Lord Goodhartrose to move Amendment No. 28AA, as an amendment to the Motion that the House do agree with the Commons in their Amendment No. 28A to Lords Amendment No. 28, leave out "agree" and insert "disagree".
The noble Lord said: My Lords, in moving Amendment No. 28AA, I wish to speak also to Amendments Nos. 28BA and 62B. These are intended to maintain the extension of time for making an application for reconsideration under the new Section 103A of the Nationality, Immigration and Asylum Act 2002 from five to 10 working days—that is, two weeks after receipt of the notice of decision.
4.45 p.m.
Five days is, frankly, a ridiculously short period of time. The applicant's lawyer will have to read the decision carefully; he or she will have to consider the legal issues involved in the decision; he or she may well have to consult the client, which is likely to involve arranging a meeting at which an interpreter must be present; he or she may have to consult counsel; and he or she will have to draft the application, a document requiring great care as it is the sole basis on which a judge of the appropriate court will decide the application. There is no chance to supplement that document at an oral hearing as there will be no oral hearing. It will also be necessary to get the application to the appropriate court before it closes for business on the last available day.
If the lawyer in question had little else to do, a five-day period might well be enough. But a competent immigration lawyer—and it is the objective of the Government, as it is of everyone else, to ensure that
these cases are handled by competent lawyers—will be handling other cases, perhaps many others, at the same

1279
time. He or she will not know in advance when the decision will be released by the tribunal. If it arrives when the lawyer is appearing in court, the lawyer cannot possibly drop everything else. The lawyer may have to hand over the case to a colleague in the same firm or organisation who is not familiar with it; or it may be impossible for the lawyer to find someone else and the applicant may have to find a new lawyer.
The noble Lord, Lord Filkin, said on Report when our amendment was accepted:
"The reason why we believe that the timetable is practical is that the grounds for appeal will already have been covered at the appeal before the tribunal".—[Official Report, 7/6/04; col. 19.]
I might rephrase that as, "It means you can draft your application in advance". That, frankly, is absurd. One ground for the application—and it is only one of many possible grounds—might be that the tribunal member in question failed to take into account evidence he should have taken into account. That comes within the description of an error of law. But how can you possibly know in advance that the member of the tribunal will have failed to take into account a particular piece of evidence? To make that application, you then have to say what the evidence was, show that it was not taken into account and why it might have made a difference it if had been. All those things will take a substantial amount of time.
The Joint Committee on Human Rights said in its 13th report of the current Session in paragraph 1.77:
"We consider the five day time limit to be far too short for the right of access to the High Court and beyond to be practically effective".
In the debate on 7 June, our amendment was supported by speakers from all Benches, including the noble Lords, Lord Clinton-Davis and Lord Plant of Highfield, from the Government Benches, and it was opposed by no one other than the Minister.
In the debate in the House of Commons on Monday of this week, the Government's amendment to restore the five-day time limit was described by Robert Marshall-Andrews as,
"a miserable, snivelling little amendment that has no valid reason behind it. It is entirely meretricious, and it smacks of petulance".—[Official Report, Commons, 12/7/04; col. 1177.]
I could not have put it better myself.
I am afraid that I simply cannot understand why the Government, totally without justification and with hardly any benefit to increasing the speed of the proceedings, continue to insist on this five-day limit. I beg to move.
Moved, as an amendment to the Motion that the House do agree with the Commons in their Amendment No. 28A to Lords Amendment No. 28, leave out "agree" and insert "disagree".—(Lord Goodhart.)
The Countess of Mar:My Lords, I support the noble Lord, Lord Goodhart, in his amendment. It seems to me nonsense to turn down a proposal to extend the time very briefly, when what is likely to result is a lot of out-of-time cases before the courts. How much time will that take and how much will it cost the taxpayer?
Lord Kingsland:My Lords, the noble Lord, Lord Filkin, was right in saying that there has been a considerable amount of beneficial flexibility as the Bill has moved through your Lordships' House and another place. The issue of time has been, in my submission, the one exception to that.
I agree with the noble Lord, Lord Filkin, that the time limits should be demanding. In Committee, we ourselves tabled an amendment suggesting a limit of seven days; but it is our view that setting a limit of five days goes too far.
There are many circumstances in immigration appeals in which it is necessary to switch from a legal adviser who has a general practice in immigration law to an adviser who deals with very special issues. It would be extremely difficult to make such a switch within as tight a timetable as five days.
Moreover, as the noble Lord, Lord Goodhart, said, although appeals can only be on the basis of an error of law, there are many occasions when, to make out an appeal on an error of law, a legal adviser has to study in considerable detail the factual structure of the case to determine whether a perverse decision was reached with respect to the evidence.
We must not forget, either, that, on occasions, the consequences of a wrong decision for an applicant are very serious if he is returned to a country that is determined to incarcerate him for a long period or to put him to death. We must remember that those applicants often do not speak any English.
In all those circumstances, it is our view that the limit of five days ought to be considered again by the Government and extended. We on these Benches will support the noble Lord, Lord Goodhart, in his amendment.
Lord Donaldson of Lymington:My Lords, in the early 1970s, it was my privilege to be the president of the National Industrial Relations Court. I claimed, rightly, that it was the fastest court in the West, which produced the reasonable comment from Michael Foot that I was "trigger happy". I mention that merely to show that I am not one who supports sluggardliness in court proceedings. It is terribly important to keep things moving. But—and this is an important but—it is no good fixing one's timetable at a point when there then must be numerous applications for extensions of time. That itself involves a waste of time.
The noble Lord, Lord Goodhart, rightly pointed out that people who are any good at any specialty in the law tend to be very fully employed. That is why they become experts and why they are so employed. That being so, I could not help thinking that the Minister believed that lawyers were concerned only with one case at a time. It would appear that he believes that they can pick up a case on a Monday and study it, not in a desultory manner but giving 11 hours to it, which is nearly two days, then have nothing else to do for the rest of the week. It is not like that. It may be that someone with a true specialty has only one case at a time and that case lasts for a couple of months—but that is very different. It is not the area that we are discussing.

1281
The Minister then talks about lawyers trawling through the law and seeking obscure technicalities. People do not do that, or certainly not in a field with which they are familiar. They know what the points are; without reference to any particular case, they know what they are looking for, and they look for it. They certainly will not try to find fancy points— unless, of course, they are satisfied that there is some real injustice occurring that is way outside the ordinary experience. Then they will look to see whether there is any way in which they can safeguard the true and real interests—not bogus interests—of their clients. I do not find that reprehensible at all, although there seems to be an assumption that it is.
I cannot understand what real difference there is between 10 days and five days. Looking at the whole period in which the proceedings are governed, I do not know quite what they are, but I am sure that an extra five days represents a very small increase in the time available. I am also tempted to wonder whether anyone has found out whether the judges can cope with that period. It is one of the features of judicial life and managing courts that there is a degree of ebb and flow. If one has no time to balance things out, one becomes either a bit slap-happy or inefficient.
I strongly support the amendment tabled by the noble Lord, Lord Goodhart, from a practitioner's point of view—meaning the point of view of a judicial practitioner.
Lord Ackner:My Lords, I, too, support the noble Lord, Lord Goodhart. The Government's approach is a recipe for half-baked cases. It means that people will be rushed in producing what should be a very important document, or they will be obliged to apply to the court to exercise its discretion—something which will add considerable delay. We are arguing about five days, which does not justify our spending more than a few seconds on this meritless opposition.
Baroness Park of Monmouth:My Lords, there is the further point, in support of the noble Lord, Lord Goodhart, that we all know that unfortunately many asylum seekers fall into the hands of unscrupulous lawyers who take on too many cases and have very little hope of delivering what they should deliver.
Lord Filkin:My Lords, I shall speak briefly, because this may be one of those occasions on which whatever one says, one is not certain of having a willing hearing.
Why go slower than necessary? That is, essentially, the Government's question. I have set out why we believe that five days is an adequate period of time. Therefore, yet again it appears that the House is always looking for reasons to make the process slower and more complex than is desirable.
I shall seek to explain why it matters that—
Lord Kingsland:My Lords, your Lordships' House might find the Minister's argument more convincing if he had taken seriously the amendments that we tabled at an earlier stage, introducing time limits to the beginning and the end of the asylum procedure—in other words, between the asylum application and the initial consideration by the Home Office; then, after the appeal process was over, between that point and the time of deportation. If the Government were prepared to entertain time limits at those stages, which cause far greater delay than the delays within the appeal procedure, your Lordships' House might find the Minister's argument more convincing.
Lord Filkin:My Lords, I shall make my own judgment on how the Government wish to put their case forward, but I am always grateful for the advice of the noble Lord, Lord Kingsland.
The essence of what we have said throughout this debate is that the Government must prevent unnecessary delay at every single part of the process. It is not a question of saying that we should bear down only on the initial consideration, although the noble Lord, Lord Kingsland, is right in saying that we should. We have made great progress on that in recent years and the process is vastly shorter and of higher quality than it was. But that is no reason whatever for saying, "What does another week matter? Let's have another week added on to the process for the avoidance of doubt". I remind the House that keeping a family on state support while a lengthy appeal process goes through costs several hundred pounds a week. The state should willingly support that expenditure if it is necessary but we should not get drawn into it if it is not.
The noble and learned Lord, Lord Donaldson, was clear in his argument that lawyers are busy people—many people are busy people—and that they are not just waiting for cases to come over the hill to be addressed. That is true, but, as I sought to indicate, on the best estimate we have been able to identify, we are talking about approximately one day's work by a lawyer. In the process that we are talking about, five days are provided for doing that one day's work and if there are reasonable grounds why that is not possible they can go to court and be granted more.
It also matters because the system is prone to abuse. I make no apology for coming back to that. We know that 50 per cent of all people who are refused by the adjudicator then appeal. The noble Lord, Lord Newton, who is in his place, will know that one gets nothing like those statistics in any other part of the tribunal system. The reason why is obvious: it runs the case long and reduces the time period when the individual might be removed from the country if he is found not to have a meritorious case.
I draw the attention of the House to the judgment by Mr Justice Collins, whose judgments have not always been met with rejoicing by the Government. He gave a clear example just last week of a case that had been run right through the process by the Refugee Legal Centre.

1283
It cost £60,000 and in his judgment Mr Justice Collins said that he found in it absolutely no merit whatever. We should not be party to supporting a system that runs cases long when there is no justification for doing so.
It is not proper for me to go into detail but, of course, the department has consulted the noble and learned Lord the Lord Chief Justice on this process. I am certain that he has a view that he does not want the High Court swamped with unmeritorious cases. We would be a foolish Government, particularly in the light of our recent experiences, if we had not consulted properly.
I shall say no more. We think that five days are perfectly adequate for this process. I do not think that we are going to have a meeting of minds on this matter so no doubt the House will decide the issue.
Lord Avebury:My Lords, before the Minister sits down, can he give us a reference to the judgment by Mr Justice Collins? The only recent case that I can recall in which a figure of £60,000 was involved was that of Jacqueline Konan who sued the Government for being unlawfully detained and was awarded damages of £60,000 by Mr Justice Collins.
Lord Filkin:My Lords, I looked for the details in my voluminous pack before I rose to speak but I could not put my finger on them. I shall write to the noble Lord with the answer very rapidly indeed.
Lord Goodhart:My Lords, I am grateful for the support that our amendment has received from other parts of the House. It has a great deal of logic and good common sense behind it. I wish to test the opinion of the House.
5.3 p.m.
On Question, Whether the said amendment (No. 28AA) shall be agreed to?
Their Lordships divided: Contents, 127; Not-Contents, 137.

Division No. 1

CONTENTS

Addington, L.

Colwyn, L.

Ampthill, L.

Cope of Berkeley, L.

Anelay of St Johns, B.

Craig of Radley, L.

Astor of Hever, L.

Crickhowell, L.

Attlee, E.

Cumberlege, B.

Avebury, L.

Denham, L.

Barker, B.

Dholakia, L.

Beaumont of Whitley, L.

Dixon-Smith, L.

Biffen, L.

Donaldson of Lymington, L.

Blackwell, L.

Dundee, E.

Bledisloe, V.

Dykes, L.

Bowness, L.

Eden of Winton, L.

Bradshaw, L.

Elliott of Morpeth, L.

Byford, B.

Elton, L.

Campbell of Alloway, L.

Falkner of Margravine, B.

Carnegy of Lour. B.

Flather, B.

Carr of Hadley, L.

Fookes, B.

Chan, L.

Fowler, L.

Clement-Jones, L.

Fraser of Carmyllie, L.

1284

Freeman, L.

Newton of Braintree, L.

Garden, L.

Northesk, E.

Glenarthur, L.

Northover, B.

Glentoran, L.

Norton of Louth, L.

Goodhart, L.

O'Cathain, B.

Goschen, V.

Onslow, E.

Hamwee, B.

Park of Monmouth, B.

Hanham, B.

Peyton of Yeovil, L.

Harris of Richmond, B.

Plumb, L.

Hayhoe, L.

Powell of Bayswater, L.

Henley, L.

Redesdale, L.

Hodgson of Astley Abbotts, L.

Rees, L.

Holme of Cheltenham, L.

Renton, L.

Hooson, L.

Roberts of Conwy, L.

Howe, E.

Rodgers of Quarry Bank, L.

Howe of Aberavon, L.

Roper, L. [Teller]

Howell of Guildford, L.

St John of Fawsley, L.

Inglewood, L.

Sandwich, E.

Joffe, L.

Seccombe, B.

Jopling, L.

Selborne, E.

Kimball, L.

Selsdon, L.

King of Bridgwater, L.

Sharman, L.

Kingsland, L.

Sharp of Guildford, B.

Knight of Collingtree, B.

Sharples, B.

Lamont of Lerwick, L.

Shaw of Northstead, L.

Lang of Monkton, L.

Shutt of Greetland, L.

Lawson of Blaby, L.

Skelmersdale, L.

Lloyd of Berwick, L.

Smith of Clifton, L.

Lucas, L.

Soulsby of Swaffham Prior, L.

Lyell, L.

Steel of Aikwood, L.

MacGregor of Pulham Market, L.

Stern, B.

Stewartby, L.

Mackie of Benshie, L.

Thomas of Gresford, L.

Maclennan of Rogart, L.

Thomas of Walliswood, B.

McNally, L.

Thomson of Monifieth, L.

Maddock, B.

Tordoff, L.

Mar, C.

Trenchard, V.

Mar and Kellie, E. [Teller]

Ullswater, V.

Marlesford, L.

Waddington, L.

Mayhew of Twysden, L.

Wade of Chorlton, L.

Miller of Chilthorne Domer, B.

Wallace of Saltaire, L.

Montrose, D.

Walpole, L.

Morris of Bolton, B.

Warnock, B.

Naseby, L.

Williams of Crosby, B.

Neuberger, B.

Windlesham, L.

NOT-CONTENTS

Acton, L.

David, B.

Ahmed, L.

Davies of Coity, L.

Alli, L.

Davies of Oldham, L. [Teller]

Amos, B. (Lord President of the Council)

Dean of Thornton-le-Fylde, B.

Desai, L.

Andrews, B.

Dixon, L.

Archer of Sandwell, L.

Donoughue, L.

Ashton of Upholland, B.

Drayson, L.

Bassam of Brighton, L.

Dubs, L.

Berkeley, L.

Elder, L.

Bernstein of Craigweil, L.

Evans of Parkside, L.

Blackstone, B.

Evans of Temple Guiting, L.

Blood, B.

Falconer of Thoroton, L. (Lord Chancellor)

Borrie. L.

Boston of Faversham, L.

Falkender, B.

Bramall, L.

Farrington of Ribbleton, B.

Brennan, L.

Filkin, L.

Brooke of Alverthorpe, L.

Fitt, L.

Brookman, L.

Fyfe of Fairfield, L.

Campbell-Savours, L.

Gale, B.

Carter, L.

Gibson of Market Rasen, B.

Clark of Windermere, L.

Giddens, L.

Clarke of Hampstead, L.

Gilbert, L.

Clinton-Davis, L.

Golding, B.

Cohen of Pimlico, B.

Goldsmith, L.

Colville of Culross, V.

Gordon of Strathblane, L.

Corbett of Castle Vale, L.

Goudie, B.

Crawley, B.

Gould of Potternewton, B.

1285

Graham of Edmonton, L.

Nicol, B.

Grantchester, L.

Parekh, L.

Greenway, L.

Patel of Blackburn, L.

Grocott, L. [Teller]

Pendry, L.

Harris of Haringey, L.

Pitkeathley, B.

Harrison, L.

Plant of Highfield, L.

Hart of Chilton, L.

Ponsonby of Shulbrede, L.

Haskel, L.

Prosser, B.

Haworth, L.

Prys-Davies, L.

Hayman, B.

Ramsay of Cartvale, B.

Henig, B.

Randall of St. Budeaux, L.

Hilton of Eggardon, B.

Rendell of Babergh, B.

Hogg of Cumbernauld. L.

Richard, L.

Hollis of Heigham, B.

Rogan, L.

Howells of St. Davids, B.

Rooker, L.

Howie of Troon, L.

Sainsbury of Turville, L.

Hoyle, L.

Scotland of Asthal, B.

Hughes of Woodside, L.

Simon, V.

Hunt of Kings Heath, L.

Simon of Glaisdale, L.

Jay of Paddington, B.

Slim, V.

Jones, L.

Strabolgi, L.

Judd, L.

Strange, B.

Kilclooney, L.

Temple-Morris, L.

King of West Bromwich, L.

Thornton, B.

Kirkhill, L.

Tomlinson, L.

Layard, L.

Triesman, L.

Lea of Crondall, L.

Truscott, L.

Lipsey, L.

Tunnicliffe, L.

Lofthouse of Pontefract, L.

Turnberg, L.

Macdonald of Tradeston, L.

Turner of Camden, B.

McIntosh of Haringey. L.

Wall of New Barnet, B.

McIntosh of Hudnall, B.

Warner, L.

MacKenzie of Culkein, L.

Warwick of Undercliffe, B.

Mackenzie of Framwellgate, L.

Watson of Invergowrie, L.

McKenzie of Luton, L.

Weatherill, L.

Mason of Barnsley, L.

Whitaker, B.

Massey of Darwen, B.

Whitty, L.

Merlyn-Rees, L.

Wilkins, B.

Mishcon, L.

Williams of Elvel, L.

Monson, L.

Williamson of Horton, L.

Morgan, L.

Woolmer of Leeds, L.

Morgan of Drefelin, B.

Resolved in the negative, and amendment disagreed to accordingly.
On Question, Motion agreed to.
5.13 p.m.
Lord Filkin:Lord Filkin: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 28B. I have spoken to this amendment with Amendment No. 28A.
Moved, That the House do agree with the Commons in their Amendment No. 28B.—(Lord Filkin.)
[Amendment No. 28BA not moved.]
On Question, Motion agreed to.
Lord Filkin Lord Filkin rose to move, That the House do agree with the Commons in their Amendments Nos. 28C and 28D to Lords Amendment No. 28 and do propose Amendment No. 28DA as a consequential amendment to Lords Amendment No. 57:
Page 39, leave out lines 30 to 41 and insert—

"may make provision about reconsideration of a decision pursuant to an order under section 103A(1) (which may, in particular, include provision about the action that may be taken on reconsideration and about the matters and evidence to which the Tribunal may have regard);

1286

shall provide that a party to an appeal is to be treated as having received notice of the Tribunal's decision, unless the contrary is shown, at such time as may be specified in, or determined in accordance with, the rules;

may make provision about proceedings under paragraph 30 of Schedule 2 to the Asylum and Immigration (Treatment of Claimants, etc.) Act 2004 (transitional filter of applications for reconsideration from High Court to Tribunal);"

28DA Line 10, at end insert "(and may, in particular, make provision of a kind that may be made by rules of court under section 103A(5)(b))"
The noble Lord said: My Lords, Amendments Nos. 28C and 28D are minor amendments. They introduce an additional flexibility to the procedure for review. In the majority of cases, the High Court judge will simply look at the applicant's papers in order to decide whether or not there may have been an error of law. However, in some circumstances it may be appropriate for other submissions to be considered. These amendments allow flexibility to make provision for this through rules of court. An example of when it might be helpful for the respondent to file submissions involves fast-track cases. Where speed is key, allowing a respondent's submissions would enable the reconsideration to take place more quickly. I should clarify that in both cases, we are talking about a process whereby a High Court judge is considering whether to allow the case to be heard on a point of law and to be returned to the AIT for this purpose. It is not itself a hearing.
Amendment No. 28DA is consequential on Amendments Nos. 28C and 28D and introduces a similar flexibility for the review while the filter is in place. For an initial period, the review application will first be considered by the tribunal. This amendment means that the procedure rules for the AIT can similarly allow the tribunal to consider additional papers. I therefore urge noble Lords to agree to Amendments Nos. 28C, 28D and 28DA. I beg to move.
Moved, That the House do agree with the Commons in their Amendments Nos. 28C and 28D to Lords Amendment No. 28 and do propose Amendment No. 28DA as a consequential amendment to Lords Amendment No. 57.—(Lord Filkin.)
On Question, Motion agreed to.
Lord Filkin:My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 28E to Lords Amendment No. 28.
This amendment brings us to the issue of lay members, which we discussed at a previous stage, when the House made clear its wish that lay members should be retained within the new asylum and immigration tribunal. The House argued that there was merit in them being there as a resource to the tribunal in certain cases.
As noble Lords will be aware, the Government did not believe that that was in principle desirable for reasons that I set out earlier. However, the Government have concluded, as can be seen from proceedings in another place, that we will not seek to insist on the removal of lay members from the tribunal;

1287
we have listened to the House in that respect. On the other hand, an amendment that was linked to it—as least by implication or consequentially—was that all tribunal panels should be three-member panels. We will consider that amendment later. In essence, in this process we are saying that we are content not to seek to remove lay members from the AIT. In a sense, our view is that it is important that the president of the tribunal has the discretion to deploy the judicial resources—including lay members—as he or she thinks fit. That is very much in tune with our discussions on these issues.
There are specific amendments on these issues essentially because draftsmen have felt that for the avoidance of doubt or better drafting processes, they needed to be brought forward in a slightly different form. Their thrust, purpose or outcome is four-square with what I believe the House wanted when it pressed this matter at previous stages. With that prelude I shall also speak to Amendments Nos. 42, 43, 44 and 61 and Commons Amendments Nos. 61A to 61C thereto, which are part of the same group.
We are prepared to accept the will of the House that there should be a role for lay members in the new tribunal. This was expressed in the original Amendments Nos. 42, 43, 44 and 61. However, the drafting had unintended consequences, and so parliamentary counsel has produced Amendments Nos. 61A to 61C and 28E in lieu. They have the same effect.
One notable difference is that the drafting of Amendment No. 61A as opposed to Amendment No. 42 allows for the appointment as legally qualified members of the tribunal of people who do not satisfy the letter of the requirements in sub-paragraphs 2(a) to (c) of Schedule 1, but who none the less are suitably qualified, perhaps from academic legal experience or judicial experience gained in another jurisdiction.
I should, of course, be clear that we are accepting lay members, but we are not prepared to accept the amendment we shall come to later—Amendment No. 46—that requires all cases to be heard by panels of three members.
I hope, therefore, that these amendments will prove uncontroversial. I ask the House to agree to Amendments Nos. 28E, 61A, 61B and 61C. I beg to move.
Moved, That the House do agree with the Commons in their Amendment No. 28E to Lords Amendment No. 28.—(Lord Filkin.)
Lord Kingsland:My Lords, I rise simply to thank the Minister for responding so thoughtfully to the amendments that we tabled to include lay members in the new tribunal system.
The Minister is right in saying that, strictly speaking, the issues raised by Amendment No. 46A fall outside the group, but, nevertheless, I think it appropriate for me to say something about that matter now. I promise not to repeat myself when the Minister rises to introduce the line of amendments beginning with Amendment No. 46 later on.
1288
I should like to suggest, respectfully, that Amendment No. 46A, if not quite meeting the principle of three-member tribunals that we sought on Report, is nevertheless a good compromise. It gives the president of the tribunal the discretion, where appropriate, in cases which raise issues of legal or factual complexity, to have tribunals of more than one member while recognising that issues of cost cannot be entirely ignored when one is managing any form of public service. The Immigration Service is no different from any other public service in that respect. I recognise that the requirement of three-member tribunals in all circumstances could be too demanding a standard to meet. The drafting that the Minister has achieved, if I may say so, is in my view masterly. I should like to thank him very much indeed for the way in which he has responded to this issue.
Lord Avebury:My Lords, it is very welcome that the Government have responded to some of the concerns that were expressed at earlier stages of the Bill. I entirely accept the Minister's claim that this has been a listening exercise and that on the whole, with certain unfortunate exceptions, Ministers have been responsive to the views that were expressed in your Lordships' House.
I wish to ask the noble Lord only one question about the particular form in which these amendments are couched. As regards Amendment No. 61A, who will exercise this opinion when the Lord Chancellor is no longer sitting on the Woolsack? That event is not far distant in time and I should have thought we might have anticipated it in the drafting.
Lord Kingsland:My Lords, I wonder where the noble Lord, Lord Avebury, was yesterday when your Lordships' House voted on this matter.
Lord Avebury:My Lords, I was listening upstairs.
Lord Filkin:My Lords, I am delighted to accept the inference of the noble Lord, Lord Avebury, that on this matter we are talking about "when" not "if", as I am sure is the case. The answer to the question asked by the noble Lord, Lord Kingsland, is that those responsibilities will be picked up by whatever successor authority the House so decides, but clearly the Government's intention is that it is picked up by the relevant Secretary of State, as we discussed in our many fulsome debates yesterday.
On Question, Motion agreed to.
Lord Filkinrose to move that the House do agree with the Commons in their Amendments Nos. 28F and 28G to Lords Amendment No. 28, and do propose Amendment No. 28H as a consequential amendment to Lords Amendment No. 28:
28H Leave out from beginning of line 111 to beginning of line 114 and insert—
"(1) On the application of an appellant under section 103A,"
The noble Lordsaid: My Lords, this is one of the most complex, interesting and potentially controversial issues that we have discussed on this Bill.

1289
At Lords Third Reading, I set out the problem we are trying to address with the proposals for a new legal aid scheme, and more broadly the move to a single tier tribunal. I sought to set out the issues that set the coloration to that: namely, that legal aid costs had quadrupled since 1998–99; that the average cost of an individual pursuing an appeal to the end of the process is some £4,000; and that these are unjustifiable amounts when only one in 10 of cases results in a different outcome.
I also signalled that the appeal process, if run to the full, could easily run to 62 weeks or more from beginning to end. I set that in the context that while undoubtedly genuine asylum claimants come to our shores, and it is our responsibility as a state to look at their cases fairly, we are also aware that a massive amount of trafficking of people goes on, as I instanced in the relevant debate.
As it stands, the system leads to delay and expense. There is concern that a slow process and an uncertain ability to bring it rapidly to a conclusion and to return people from whence they came feeds the traffickers' business and makes it easier for them to get people to pay remarkably high sums of money to be brought here.
In introducing a new system we have to ensure that the exploitation does not continue. The new legal aid arrangements are central to achieving that. They will stop weak applications from flooding the High Court which leads to the cycle of delay, while ensuring at the same time that the interests of justice are met.
The new scheme that we are bringing forward, which is different from the one that we discussed at Third Reading—again, we listened to the arguments put forward on this matter—will be a system of retrospective funding. We are not removing legal aid for the review and reconsideration but we are clear that lawyers have to take a part in making judgments about whether cases are meritorious. While lawyers will not know until the end of the process, when the judge makes his order, whether they will receive legal aid, good lawyers already make such judgments. The system that we are constructing will try to ensure that all lawyers make the kind of judgments that a good lawyer does in such circumstances.
However, in introducing a scheme involving retrospective funding, we recognise that the focus of the scheme should be on merit and not just success. At Third Reading I therefore agreed with the noble Lord, Lord Kingsland, on this point—we tested each other across the Dispatch Box to make sure there was no misunderstanding and we managed to reduce most if not all of the misunderstanding—when he signalled that he would like to see a system based on a "robust merits test". There appeared, therefore, to be no issue of principle between us on that; it was a matter of how one applied that.
This has always been the Government's intention. It became apparent at Third Reading that perhaps there were different ways of achieving that objective from the one that we had advanced to the House which
1290
clearly caused unhappiness on the part of some noble Lords. I do not think that "unhappiness" is too sharp a word. Therefore, I hope that the amendments which we brought forward in another place are seen as very much four-square with what I signalled in broad terms at Third Reading.
Amendment No. 28F removes the provision for variable fees to be paid dependent on the result of the reconsideration. Amendment No. 28G links the award of legal aid more explicitly to an applicant's prospects of success at the time the application was made; that is, whether the case had significant merit such that the lawyer was right to pursue it in a system based on merit. In a system based on merit that is fair. This test does not ask lawyers to pre-empt the decision of the tribunal; it simply asks them carefully to assess whether a case has merit. If the judgment they have made is sound, which is reasonable to expect, legal aid will be paid.
We were brought to that conclusion by thoughtfulness by counsel that the best way of ensuring justice was that the tribunal should decide whether legal aid should be paid, not in a sense simply by what happened at the end, but by looking at the case as it was at the time that the lawyer had to make the judgment at the beginning of the process. That seemed a very fair point, so that hindsight is not applied to the decision but that it can be said that, when the lawyer had to make the decision, the question was whether the case had merit.
5.30 p.m.
The amendments meet many of the concerns raised. I recognise that they did not respond to all of the noble Lord's concerns, which is why, following discussion, the Government proposed Amendment No. 28H. It enables the High Court to award legal aid for the review application even if no reconsideration order or Court of Appeal referral has been made.
It is important to be clear exactly what Amendment No. 28H means. It remains our intention that the High Court's power to award legal aid will be used only in exceptional cases. In the majority of cases, the tribunal will be best placed to make the decision on funding at the reconsideration. At that stage, the tribunal will possess the relevant information to decide whether, when the review application was made, the lawyer was right to have pursued the case. By comparison, the High Court will simply consider, on the papers, whether there may have been an error of law—in other words, whether the case should be looked at further.
Although we accept that there may be circumstances where it is appropriate for the High Court to award legal aid for a review application, even if an order for reconsideration or a referral is not made, regulations will be made to prescribe tightly when that power can be exercised. An example of when the power might be used is when a reference to the Court of Appeal is made. Another might be when a review application which has good prospects of success is rendered unsuccessful following a lead decision of a case, which had not been decided at the time the application was made.

1291
We are committed to a system based on merit. Payment will not be conditional on success but, if we are to weed out the weak applications, we have to incentivise the system in the way in which we have done. Having listened to the House, we believe that we have a system that achieves what those in most if not all parts of the House feel are, for good reason, the objectives of government policy. I therefore urge the House to agree to Amendments Nos. 28F, 28G and 28H.
Moved, That the House do agree with the Commons in their Amendments Nos. 28F and 28G to Lords Amendment No. 28, and do propose Amendment No. 28H as a consequential amendment to Lords Amendment No. 28.—(Lord Filkin.)
Lord Kingsland:My Lords, again, I am most grateful to the Minister for his explanation of the amendments. As the noble Lord said, we did not vote on our amendments to remove the conditional fee system at Third Reading on the basis of certain undertakings that he gave. He has met those undertakings in full for which I am extremely grateful. As this is the last group of amendments on which I shall speak, I thank him very much for his cooperation throughout the whole process.
Lord Goodhart:My Lords, although I regret that the Government did not accept our important arguments on giving legal aid on a somewhat wider basis than is now proposed, the amendments are, at any rate, some improvement on the previous position. In the circumstances, given that there would be no prospect of our succeeding on any further vote on the matter, we do not oppose the amendment.
Lord Newton of Braintree:My Lords, having indicated that I very much shared the concerns underlying the exchanges that took place last week, I want to record that I think that the Minister's response is extremely positive and welcome. I express my thanks to him for that.
On Question, Motion agreed to.

LORDS AMENDMENTS
42 Schedule 1, page 32, line 17, after "legal" insert "or lay"
43 Page 32, line 18, leave out first "as"
44 Page 32, line 18, leave out from "appointment" to end of line 19
The Commons disagree to these amendments and to Lords Amendment No. 61, but propose Amendments Nos. 61A to 61C in lieu thereof.
61A Page 32, line 19, at end insert—
"or,
(e) in the Lord Chancellor's opinion, has non-legal experience which makes him suitable for appointment.
(2) A person appointed under sub-paragraph (1)(a) to (d) shall be known as a legally qualified member of the Tribunal."
61B Page 37, line 5, after "a", insert "legally qualified"
61C Page 41, line 3, leave out paragraph 28 and insert—
"28 Where immediately before commencement a person is a member of the Immigration Appeal Tribunal—

he shall be treated as having been appointed as a member of the Asylum and Immigration Tribunal under paragraph 1 of Schedule 4 to that Act immediately after commencement, and

if he was a legally qualified member of the Immigration Appeal Tribunal (within the meaning of Schedule 5 to that Act) he shall be treated as having been appointed as a legally qualified member of the Asylum and Immigration Tribunal."

Lord Filkin:Lord Filkin: My Lords, I beg to move that the House do not insist on its Amendments Nos. 42 to 44 to which the Commons have disagreed and do agree with the Commons in their Amendments Nos. 61A to 61C in lieu thereof. I spoke to the amendments with Amendment No. 28E.
Moved accordingly, and, on Question, Motion agreed to.

LORDS AMENDMENT
46 Page 33, line 8, leave out from "by" to end of line 9 and insert "three members unless the President from time to time directs"
The Commons disagree to this amendment but propose the following amendment to the words so restored to the Bill—
46A Page 33, line 9, after "President", insert ", having regard to the complexity and other circumstances of particular cases or classes of case,"
Lord Filkin:My Lords, I beg to move that the House do not insist on its Amendment No. 46 to which the Commons have disagreed and do agree with the Commons in their Amendment No. 46A to the words so restored to the Bill.
Moved accordingly, and, on Question, Motion agreed to.

LORDS AMENDMENT
61 Schedule 2, page 41, line 3, at end insert "or lay"
Lord Filkin:My Lords, I beg to move that the House do not insist on its Amendment No. 61, to which the Commons have disagreed. I spoke to the amendment with Amendment No. 28E.
Moved accordingly, and, on Question, Motion agreed to.

LORDS AMENDMENT
62 Page 41, line 14, at end insert—

"30 This paragraph shall have effect in relation to applications under section 103A(1) or for permission under section 103A(4)(b) made—

during the period beginning with commencement and ending with such date as may be appointed by order of the Lord Chancellor, and

during any such later period as may be appointed by order of the Lord Chancellor.

An application in relation to which this paragraph has effect shall be considered by a member of the Asylum and Immigration Tribunal (in accordance with arrangements under paragraph 8(1) of Schedule 4 to the Nationality, Immigration and Asylum Act 2002 (c. 41) (inserted by Schedule 1 above)).

1293

For the purposes of sub-paragraph (2)—

references in section 103A to the appropriate court shall be taken as references to the member of the Tribunal who is considering the application or who is to consider the application,

rules of court made for the purpose of section 103A(4)(a) in relation to the court to which an application is made shall have effect in relation to the application despite the fact that it is considered outside the appropriate court, and

section 103A(6) shall be subject to sub-paragraph (5) below.

Where a member of the Tribunal considers an application under section 103A(1) or 103A(4)(b) by virtue of this paragraph—

he may make an order under section 103A(1) or grant permission under section 103A(4)(b), and

if he does not propose to make an order or grant permission, he shall notify the appropriate court and the applicant.

Where notice is given under sub-paragraph (4)(b)—

the applicant may notify the appropriate court that he wishes the court to consider his application under section 103A(1) or 103A(4)(b),

the notification must be given within the period of 10 working days beginning with the date on which the applicant is treated, in accordance with rules under section 106 of the Nationality, Immigration and Asylum Act 2002 (c. 41), as receiving the notice under subparagraph (4)(b) above, and

the appropriate court shall consider the application under section 103A(1) or 103A(4)(b) if—

the applicant has given notice in accordance with paragraphs (a) and (b) above, or

the applicant has given notice under paragraph (a) above outside the period specified in paragraph (b) above, but the appropriate court concludes that the application should be considered on the grounds that the notice could not reasonably practicably have been given within that period.

Rules of court may specify days to be disregarded in applying sub-paragraph (5)(b).

A member of the Tribunal considering an application under section 103A(1) by virtue of this paragraph may not make a reference under section 103C.

An order under sub-paragraph (1)(a) or (b)—,

shall be made by statutory instrument,

shall not be made unless the Lord Chancellor has consulted such persons as he thinks appropriate, and

shall not be made unless a draft has been laid before and approved by resolution of each House of Parliament."

The Commons agree to this amendment with the following amendment—
62A Line 33, leave out "10 working" and insert "5"
Lord Filkin:My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 62A to Lords Amendment No. 62. I spoke to the amendment with Amendment No. 28A.
1294
Moved, That the House do agree with the Commons in their Amendment No. 62A to Lords Amendment No. 62.—(Lord Filkin.)
[Amendment No. 62B not moved.]
On Question, Motion agreed to.

Companies (Audit, Investigations and Community Enterprise) Bill [H.L.]
5.36 p.m.
Lord Grocott:My Lords, I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Companies (Audit, Investigations and Community Enterprise) Bill, have consented to place their Prerogative and Interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Bill read a third time.
Clause 43 [Appointment of director]:
Lord Glentoran Lord Glentoran moved Amendment No. 1:
Page 38, line 27, at end insert—
"( ) Before the appointment of a director under this section, the Regulator must take all reasonable steps to ensure that the chairman and board of the community interest company agree that his actions are necessary and appropriate."
The noble Lordsaid: My Lords, it is quite clear what I am after in Amendments Nos. 1 and 2. We have debated the topic. I did not move the equivalent amendment on Report for various reasons, which those of us who attended the debate will understand. However, I would like some reassurance on the matter from the Minister. I have written to him; he knows what I am looking for. I beg to move.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville):My Lords, I had an interesting discussion with the noble Lord a few weeks ago about the issues underlying the amendments, and he has since written to me about them. He made the point that, where the regulator uses his powers to appoint a director or a manager to a CIC, it would be helpful if the regulator could obtain the consent of the CIC's existing directors to his action. That would reduce the risk of the regulator acting in a heavy-handed way, and of the appointment leading to tensions within the management team.
We would all agree that it would be desirable to get the consent of the CIC's directors to an appointment, and that the regulator should aim to do it where possible. However, it will not always be realistic to expect to obtain the board's agreement. As the noble Lord and I have discussed, an appointment under either of the powers will be made only where the CIC in question is in breach of at least one of the default conditions set out in Clause 39, and the regulator thinks that the power must be exercised to maintain confidence in CICs. The situation will therefore be quite serious.

1295
In such a position, we would of course expect the regulator to be in dialogue with the CIC concerned. He will surely need to talk to the directors of the CIC to find out what is going on, and what needs to be done to fix it. If he has not done so, he will not be able to provide good reasons for taking action, and will, quite rightly, be challenged. But there can be no certainty that the board of the CIC will co-operate with him, let alone that it will agree with the regulator's decision. For instance, the regulator may decide to appoint a director or a manager to a CIC because he considers that the existing directors are not capable without assistance of remedying the problem. In some cases, one can easily imagine that the existing directors might not agree. In other cases, the board might be so split that no agreement was possible.
I know that the noble Lord, Lord Glentoran, appreciates those points. I expect that is why his amendments require the regulator to,
"take all reasonable steps to ensure"
the consent of the board, rather than to require their consent in all cases. However, I do not think that this additional measure is necessary. That is because the regulator is already required by the general principles of administrative law not to behave unreasonably. He is also subject to the specific constraints in the Bill, to act in accordance with good regulatory practice and to use his supervisory powers only where necessary. This means that where the regulator acted improperly or unreasonably in making an appointment, he would be subject to challenge.
If the appointment of a manager or director by the regulator is unnecessary, or inappropriate, the regulator would be in breach of his duty in Clause 39 to use his powers only to the extent necessary; and the CIC would be able to appeal to the appeal officer. The Government brought forward amendments at Report stage to require the regulator to give reasons for his decisions and to allow the appeal officer to consider appeals on matters of law as well as fact.
Overall, the Bill together with existing administrative law already place significant constraints on the way in which the regulator may use his power. As I have said in previous debates, our aim is that the regulator should have a light but proportionate touch and we think that the current provisions of the Bill achieve that. I hope that in the light of that explanation the noble Lord, Lord Glentoran, will be reassured and will feel able to withdraw the amendment.
Lord Glentoran:My Lords, I thank the Minister for that statement. I do, indeed, feel reassured and, as this is where we wind up, I should say that for my part, in Part 2 of the Bill, we started with almost a sketch and have finished with a Bill that will achieve what the Government desire and will be comprehensible, usable and welcome. I offer my thanks to the Bill team and to the Minister for their courtesy. I hope that CICs become a success. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 45 [Appointment of manager]:
[Amendment No. 2 not moved]
An amendment (privilege) made.
Lord Sainsbury of Turville:My Lords, I beg to move that this Bill do now pass.
This is an important and highly technical Bill and I am grateful to noble Lords on all sides of the House for taking part in the debates. The Government have listened carefully to all the points made. By my reckoning, nearly half of the government amendments tabled on Report were wholly or partly in response to points raised by noble Lords in Grand Committee. I believe, therefore, that we can all take satisfaction in having scrutinised and improved the Bill before sending it to the other House.
Perhaps I may also take this opportunity to thank the Bill team who have done a magnificent job, both in maintaining the clear purposes of the Bill, while at the same time being flexible in responding to thoughtful criticisms of practical details.
Moved, That the Bill do now pass.—(Lord Sainsbury of Turville.)
Lord Hodgson of Astley Abbotts:My Lords, this has been an odd Bill in the sense that we have had the cart before the horse—the horse being the company law review for the first part and the Charities Bill for the second. It has not been a particularly party political Bill because there has been fairly broad strategic agreement about what we were seeking to achieve, but there were, nevertheless, several lacunae or weaknesses that we were able to address in Committee—in particular, the regulatory burden.
It is good that the Government have listened and I should like to place on record our thanks to the noble Lords, Lord Sainsbury and Lord Evans, who arranged the meetings at which we were able to examine the issues that concerned us and to explain how we felt that they could best be remedied. As a result I am happy to agree with the Minister that we have improved the Bill significantly during its passage through the House.
Perhaps I may add my thanks from these Benches to Keith Masson and the Bill team. I know that at an earlier part of the proceedings I said that he had drafted a wonderful chart of the new FRC structure. He subsequently told me that it was not him, but someone else in the Bill team who was responsible and I am happy to place on record my thanks to whoever it was who drafted that particular part of the Bill it was very helpful, given the dense nature of the first section.
We also offer thanks for the external help and advice we had from the Law Society, the Institute of Chartered Accountants in England and Wales, Ashursts and from George Bompas QC, who was helpful on various aspects of extraterritoriality and the investigative side.

1297
We on these Benches conclude by saying that good corporate governance and a strong charitable sector are clearly important parts of our society. In so far as the Bill encourages both of those, we wish it well.
Lord Sharman:My Lords, I echo the sentiments of the noble Lord, Lord Hodgson. The Bill is now improved and significantly workable. I am particularly pleased that the Government listened and took a great deal of action on Clause 9, which was causing some considerable difficulties on this side of the House. I should also add my thanks to the Bill team. I should not admit that it was the first time that I understood the regulatory regime of accountants. So, thank you very much for that. The team has done an excellent job and we now have a Bill that is workable and will be of great benefit. Thank you.
On Question, Bill passed, and sent to the Commons.

Constitutional Reform Bill [H.L.]
5.47 p.m.
The Secretary of State for Constitutional Affairs and Lord Chancellor (Lord Falconer of Thoroton):My Lords, I beg to move that the House do now again resolve itself into Committee (on Recommitment) on this Bill.
Moved, That the House do now again resolve itself into Committee (on Recommitment). (Lord Falconer of Thoroton.)
On Question, Motion agreed to.
House in Committee (on Recommitment) accordingly.
[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Boston of Faversham) in the Chair.]
Clause 1 [Guarantee of continued judicial independence]:
Lord Peyton of Yeovil moved Amendment No. 5:
Page 1, line 10, after "not" insert "under any circumstances or by any means"
The noble Lordsaid: In moving this modest and simple amendment, I should first like to comment briefly on the fact that the noble Lord, Lord Richard, yesterday took me to task for having allowed a note of acidity to creep into my speech. My only comment on that is that, given my view of the recent saga regarding the Government's conduct towards the House of Lords, I thought my reaction was more than justified. I have nothing to add beyond that.
The first of my two amendments is rooted in doubt and uncertainty as to whether the Government actually mean what they say. I should be interested to hear what the noble and learned Lord says in reply. It is admirable that the Bill says that Ministers,
"must not seek to influence".
My suggestion is that it would be more impressive if the words,
"under any circumstances or by any means"
1298
were inserted. I see no reason why they should not be, and that would underline the Government's stated intention and is in no way contrary to what Ministers state is their intention. I hope therefore that the noble and learned Lord will in an act of grace, which would go some way to comfort me, seek to accept the amendment on behalf of the Government. There is no need for me to prolong my remarks. The meaning of the amendment is obvious. I beg to move.
Viscount Bledisloe:Amendment No. 6 is grouped with Amendment No. 5, although the noble Lord, Lord Peyton, has not yet spoken to it. It seems to me that Amendment No. 6 adds enormous force to the issue. At present, Clause 1(3) states:
"Ministers of the Crown must not seek to influence particular judicial decisions through any special access to the judiciary".
Lord Peyton of Yeovil:Perhaps the noble Viscount will forgive me for intervening. He is right: I did not refer to Amendment No. 6. Perhaps I should have done, but I thought that it would be simpler to keep the two separate, even though they are grouped together. After all, I have a right to move Amendment No. 6 in due course.
Viscount Bledisloe:I am in the hands of the Committee. I think that Amendment No. 6 is necessary and that, with that amendment, Amendment No. 5 is unnecessary. However, I shall happily wait until the noble Lord moves Amendment No. 6 before I say why it is desirable. I do not know whether the noble and learned Lord would find it more convenient to deal with the two together or separately. Perhaps he could give us some guidance.
Lord Crickhowell:I rise because my name is attached to Amendment No. 5. I had expected my noble friend to speak to both amendments together, and I think that it would have been helpful if he had. Although I put my name to Amendment No. 5 and not Amendment No. 6, on reconsideration I greatly prefer Amendment No. 6. But the fact is that my concern about this issue is fairly obvious.
It is a rather extraordinary suggestion that Ministers should seek to interfere by having private conversations with judges in order to try to obtain a particular decision. I do not think that is very likely to happen. The idea that they will carry out personal lobbying does not seem to me to be the real threat. The real threat is that there may be an attempt by Ministers, through briefing and so on, to stir up the media to create a campaign on why a particular line taken by the judiciary is wrong and to force the judiciary down a route where the law would not take them. Indeed, it is possible that a Minister would do something that I considered to be extremely unwise, as the Home Secretary did the other day. He commented on the kind of judgment that he would like to see in the case of the individual who had been sentenced in Portugal for offences in connection with football hooliganism.

1299
I am far more concerned about those wider horns of influence. I think that they would be effectively dealt with in a straightforward clause stating that one must not seek to influence particular judicial decisions. Such a clause would be totally unqualified, and that is what I should like to see us finish up with.
Lord Lloyd of Berwick:At some stage—
Viscount Bledisloe:May I be allowed to finish what I started?
Lord Lloyd of Berwick:Perhaps I may suggest to the Committee that the noble Lord, Lord Peyton, should move Amendment No. 6, to which I should certainly like to add a comment.
Lord Carter:The noble Lord cannot move Amendment No. 6. He moved Amendment No. 5 and that must be dealt with before we reach Amendment No. 6. As they are grouped, it would be easier if the two amendments were debated together and then the noble Lord could dispose of Amendment No. 5, followed by Amendment No. 6.
Lord Peyton of Yeovil:I think that it is the will of the Committee that I speak briefly to Amendment No. 6. I am very happy to do so, and I apologise to all concerned if I made it in any way awkward for them by my failure to do so before.
The words,

"through any special access to the judiciary",
are, first, rather suggestive that people have a habit of making secret approaches to the judiciary. I think that that is totally unjustified. Secondly, without those words, the clause means all that one wants it to mean, and I cannot see that anything is gained by adding those words to it. I shall be most interested to hear what the noble and learned Lord says, but I cannot think that the words are necessary and it is my intention, in due course, to move that amendment.
Lord Lloyd of Berwick:As my name is added to Amendment No. 6, 1, too, want to say that I cannot see any reason that the obligation under Clause 1(3) should be restricted to cases where the Minister has "special access to the judiciary", whatever those words may mean. So far as I am concerned, they do not have any obvious meaning.
In any event, the restriction is undesirable because it may suggest that Ministers can seek to influence particular judicial decisions when they are not taking advantage of special access. Is that really what the Government intend? I am sure that that is not the case.
Viscount Bledisloe:I can now complete what I was trying to say. I would put the point rather higher than the noble and learned Lord, Lord Lloyd. If one says that Ministers cannot seek to influence particular judicial decisions through any special access to the judiciary, one is accepting that they can seek to influence particular judicial decisions by any other
1300
means. There is only one possible way in which it is proper for the Government to seek to influence particular decisions and that is by addressing the court either as a party to the case or as an amicus curiae if they are allowed to appear as such. But there is no other way in which it is proper for the Government to seek to influence particular judicial decisions. The words should be removed from the clause and then we would not need the words in Amendment No. 5.
The Earl of Erroll:First, as a layman, I have listened to many debates in this House and I have always gathered that when extra words are added to a measure in this way, thus qualifying it, that immediately implies that anything not included in those words is then allowed. Therefore, as it stands, the clause specifically allows other influence to take place.
Secondly, I think that the wording is intended to deal with the concordat, which we do not know much about. It is trying to say that in the concordat between Ministers and the judiciary there should not be any mechanism by which one can influence the other. I was concerned when I heard about the concordat earlier because I thought that it should be subject to parliamentary scrutiny. At present, the judiciary should be responsible to Parliament and not to a Minister in another place. We are not talking about a true separation of powers, and I think that this is one of the hidden, underlying examples of where the powers are not separated because we have a concordat that is not subject to parliamentary scrutiny.
Lord Carter:Lord Carter: With regard to
Lord Campbell of Alloway:Lord Campbell of Alloway: Amendment No. 6—
Lord Evans of Temple Guiting:Perhaps we may hear from my noble friend Lord Carter.
Lord Carter:To answer the point made by the noble Earl, the concordat is printed in full as an annex to the report. The amendments that needed to be made to the Bill as a result of the concordat were either inserted into the Bill in the Select Committee or the Lord Chancellor said that he would do so.
The Earl of Erroll:I thought that a concordat could be changed subsequently without parliamentary scrutiny—that is, it is a side agreement. Although the concordat may be as it is at present, future changes to it would not necessarily be subject to parliamentary scrutiny. But I do not understand these matters properly.
Lord Carter:I am sure that if elements of the concordat were not in the Bill and it needed to be changed, it would be fully debated. If they were in the Bill, one would need primary legislation in order to alter it.
Lord Campbell of Alloway:I rise only to support Amendment No. 6—for some of the reasons that have been given.
Lord Falconer of Thoroton:I start by making two procedural points. First, the speech made by the noble

1301
Lord, Lord Peyton, yesterday was a little acidic, but I have always thought that the point of the noble Lord was his acid. I hold him in the highest possible affection and did not take any offence whatever yesterday in relation to his speech.
Secondly, with regard to the Committee stage yesterday evening and, again, this afternoon, perhaps I may say as a spectator—I feel like a bit of a spectator in this—that our proceedings are becoming somewhat private. No one appears to be able to make a speech from beginning to end; everyone who speaks is primarily a member of the committee; and everyone else who then intervenes is treated like an outsider. I do not know what other noble Lords think, but it may be more sensible for us to proceed in the conventional, rather than the unconventional, way.
I turn to the points raised in the two amendments tabled by the noble Lord, Lord Peyton, and, first, to the words,
"through any special access to the judiciary".
The subsection was expressed in that way precisely for the reason given by the noble Viscount, Lord Bledisloe. There are cases in which, quite legitimately, a Minister will wish to influence the court. As the noble Viscount, Lord Bledisloe, said, one such occasion is when he is appearing as a party in the proceedings. He will seek to influence, and that is why the clause is worded in that way.
The noble Lord, Lord Crickhowell, expressed the fear that public campaigns might be used to seek to put pressure on the judiciary. That is dealt with by the Contempt of Court Act. The courts have been robust in stating those things that they can resist. This is slightly different. Where juries are involved, the courts have quite rightly been much more susceptible and tried to ensure that no sort of campaign is started. But broadly I do not think that there is much dispute between us as to what we seek to achieve; namely, no undue influence on the judges; that it is plainly quite legitimate to argue one's case in court; and not to start campaigns or behave improperly in relation to that, but that is dealt with by the Contempt of Court Act.
Amendment No. 5 seeks to insert the words,
"under any circumstances or by any means".
Following up what the noble Earl said, it is best not to insert words that are unnecessary. To insert those words after the words "must not" would not add anything to the Bill. "Must not" is absolute. It does not need further clarification. Amendment No. 5 is unnecessary to achieve the purpose that the noble Lord wishes to achieve. In those circumstances, I hope that the noble Lord will feel able to withdraw his amendment.
6 p.m.
Viscount Bledisloe:In the light of what the noble and learned Lord said about representations, would he be prepared at the next stage to delete the words,
"through any special access to the judiciary",
1302
and insert, "save by legal representations made in court"?
Lord Falconer of Thoroton:I think that it is okay the way that it is done.
Lord Peyton of Yeovil:I am grateful to the noble and learned Lord. I am not really surprised. I agree that on the whole the words do not add anything. I just wanted them to underline what the Government have said. After all that has happened, one sometimes has doubts, if I may put this gently, as to the durability of the Government's intentions. I say no more than that. I am content to beg leave to withdraw the amendment. However, before I do that, as Amendment No. 6 is grouped with this amendment, I am not at all sure what the noble and learned Lord said; that is, whether he is willing to accept Amendment No. 6 or whether he will take it away and think about it. I did not gather what his intention was.
Lord Falconer of Thoroton:As I made clear—I apologise to the noble Lord that I did not make it clear before— no, I am not minded to accept it, nor to take it away and think about it.
Lord Peyton of Yeovil:If it is clearly the noble and learned Lord's intention to reject the amendment, I will take it away and think about it and perhaps come back with a repetition on Report. First, it conveys an impression which is not very nice and, secondly, the words which would remain in the clause are quite sufficient to stop any kind of influence by Ministers anywhere, and this adds nothing. However, in the circumstances, I am content to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 6 not moved.]
The Deputy Chairman of Committees (Lord Boston of Faversham):I must point out to the Committee that if Amendment No. 7 is agreed to, I cannot call Amendment No. 8.
Lord Kingslandmoved Amendment No. 7:
Page 1, line 12, leave out "Secretary of State for Constitutional Affairs" and insert "Lord Chancellor"
On Question, amendment agreed to.
[Amendment No. 8 not moved.]
Lord Goodhartmoved Amendment No. 9:
Page 1, line 12, leave out "have regard to" and insert "respect"
The noble Lord said: Amendment No. 9 is grouped with Amendments Nos. 10 to 13 and Amendment No. 16. Amendment No. 9 is intended to bridge what appears to me to be a gap between two positions to call them "extreme" might be putting it a little high—which are some way out of the middle ground. As I said, Amendment No. 9 is intended to bridge that gap, and so is Amendment No. 19, which was partly spoken to yesterday.

1303
In Clause 1(4) the Government state that the Minister must have regard to—the key words are "have regard to"—the need to defend the independence of the judiciary, the need to provide support for the judiciary and the need for the public interest to be represented in decisions affecting the administration of justice. I believe that the words "have regard to" in the context are extremely and undesirably feeble. Regard can be had to all sorts of matters. For example, regard may be had to the outcome of next week's by-election.
Lord Roper:That is tomorrow.
Lord Goodhart:I was speaking in a general sense. The words "have regard to" do not indicate any priority for the defence of judicial independence over other factors. On the other hand, I believe that Amendments Nos. 10 to 13 go too far the other way by imposing duties on the Minister which appear to be justiciable. Amendment No. 16 goes further still because the use of the word "unlawful" makes it plain that the relevant duties are intended to be justiciable.
That is of particular importance in relation to Clause 1(4)(b). That is the paragraph that refers to,
"the need for the judiciary to have the support necessary to enable them to exercise their functions".
If that is a justiciable duty, it could be for the court to decide whether the Minister had provided the support needed by the judiciary in the event of a dispute. I do not know how, in those circumstances, one could possibly find an impartial court to decide that issue. But if one could, it would then extend the existing powers of the court to control powers of spending by the Government. That is an undesirable step towards government by judges rather than by elected representatives.
Amendment No. 9 replaces the words, "have regard to" with "respect" in relation to the independent judiciary. Amendment No. 19 creates similar wording in relation to the rule of law. I believe that "respect" is stronger than "have regard to". It creates a higher benchmark for the Minister to apply when he or she is making a decision, but it leaves that decision on issues such as the needs of the judiciary within the discretion of the Minister. It does not create an objective test that can be examined and enforced by the courts. I think that that is the right balance. I beg to move.
Lord Windlesham:Amendment No. 10 is tabled in my name also. I support what was said by the noble Lord, Lord Goodhart. It seems to me that "respect" is somewhat stronger than "have regard to". These are very fine distinctions and it is highly unlikely that we will find cases before the court in which the Secretary of State of the day has to justify the significance of the word that is used in the statute. On the other hand, in a way, these are demonstrative. They indicate the seriousness of purpose, the gravity, of the clause. I would hope that the noble and learned Lord the
1304
Lord Chancellor might be willing to consider them very carefully. If he believes that there are substantial differences in practice, perhaps he would tell us.
Viscount Bledisloe:Amendment No. 10, which appears also in my name, does two things. First, it incorporates into Clause 1(4) the rule of law point. At this stage that is inappropriate because a decision was not reached on that last night. Therefore, I cannot press Amendment No. 10 today. However, more importantly for this purpose, it deals with the question of the right word. I could not agree more with the noble Lord, Lord Goodhart; the words "have regard to" are ridiculously mealy-mouthed for the duty to defend the independence of the judiciary.
I accept also that "respect" is a bit of an improvement, but it does not go far enough. I see nothing wrong with,
"take all necessary steps to ensure that".
I do not think that the question of the change of wording in any way affects justiciability. That matter is dealt with by Amendment No. 16, which I apprehend the noble and learned Lord, Lord Lloyd of Berwick, will want to deal with separately, rather than in this group.
Will the noble and learned Lord the Lord Chancellor do two things: first, accept that "have regard to" is too weak; and, secondly, agree to consider what the appropriate phrase is to make the provision more meaningful? Whether or not one wants justiciability, this is not the right way to get it, without risking incorporating justiciability by the back door. I do not think Amendment No. 10 does that, but the noble Lord, Lord Goodhart is concerned about it.
Some form of wording must be put in Clause 1(4) which is vastly stronger than just saying, "Yes, we take the independence of the judiciary into account, but we take into account a lot of other things. We have taken that into account, but we have dismissed it and come to this conclusion although it will grossly infringe the independence of the judiciary". The phrase is just far too weak.
The Earl of Erroll:Although a layman, I have listened to many debates on this kind of subject. I totally agree that "having regard to" is far too weak. It is the equivalent of saying "must consider". One says, "Well, I have considered it", but with no duty as to the outcome of that consideration. The consideration has to be in a particular direction. I think that certainly one, if not more, noble and learned Lord made that same point in the report. I think that the phrase is far too weak and that something must be done about it with one of the amendments.
Lord Lloyd of Berwick:I support what has just been said by the noble Earl, Lord Erroll. I stand by the spirit of Amendment No. 10, even though at the moment it may not be possible to agree it.

1305
Perhaps I may also say while I am on my feet that I would seek the leave of the Committee to de-group Amendment No. 16. It really belongs in the group with Amendments Nos. 15 and 16A.
Lord Mayhew of Twysden:I support Amendment No. 10 and distance myself from Amendment No. 9. The noble Lord, Lord Goodhart, a few minutes ago spoke of the need to find a word which was justiciable. It is awfully difficult to think of how the verb "to respect" can be justiciable.
Lord Goodhart:I apologise to the noble and learned Lord. I was really raising quite the opposite point: I was seeking a word which I regarded as having a symbolic value, but which was not justiciable.
Lord Mayhew of Twysden:This is all rather head of a pin stuff. I think that Amendment No. 10 is better, for the reasons that have been advanced, although I am always a little diffident about legislating for all necessary steps to be taken. However, since the amendment has the support in particular of the noble and learned Lord, Lord Lloyd of Berwick, I am prepared to go along with it with some confidence, unless the noble and learned Lord the Lord Chancellor can come up with a word that meets all these objections.
Lord Brennan:If we look at Clause 1 in its entirety, subsection (I) is the exposition of the guarantee referred to in the rubric to this clause. Subsection (4) can only have sense if it refers to the circumstances in which that guarantee will be honoured. It seems to me that whether we use the words "have regard to", "respect" or "take all reasonable steps to ensure", or whatever, Clause 1 is almost incomprehensible unless the Minister adequately has regard to the factors in subsection (4) in order to fulfil the guarantee that he has a duty to fulfil. All we need from my noble and learned friend is confirmation that the subsection buttresses the duty.
Lord Campbell of Alloway:I support Amendment No. 10.
6.15 p.m.
Lord Kingsland:I entirely agree with the noble Lord, Lord Goodhart, that "have regard to" is too weak. It requires the Minister to look at something but thereafter conclude that he does not have to give any weight to it. So, whatever else we do, it is necessary for your Lordships to consider another way of expressing the Minister's obligation under subsection (4).
The noble Lord, Lord Brennan, with great respect to him, is correct in saying that the primary obligation is in Clause 1(1); and I suppose that the operational paragraph in respect to that is subsection (4). So there is an absolute obligation in subsection (1) to uphold the independence of the judiciary; and under subsection (4), the Secretary of State for Constitutional Affairs shall have regard to whether or not he needs to defend that independence. In my submission, that is an unfortunate dilution of the obligation in Clause 1(1), and for that
1306
reason alone the Minister needs to look again at the wording in subsection (4). I prefer Amendment No. 10, which makes the obligation much clearer and is more satisfactorily expressed.
Lord Falconer of Thoroton:There is broad agreement between the speakers: first, that they do not wish to make the effect of Clause 1(1) or (4) subject to legal proceedings; and, secondly, that the words "have regard to" are too weak. On the first point I agree with those noble Lords who say that we are not seeking to create any sort of basis for legal proceedings.
Lord Lloyd of Berwick:I am sorry to interrupt. That is exactly why I sought the leave of the Committee to de-group my amendment because that is exactly what I shall be suggesting should be done. I do not think that anyone has addressed that point yet.
Lord Falconer of Thoroton:I was wrong because the noble and learned Lord, Lord Lloyd of Berwick, was a speaker in the earlier debate but failed, quite rightly, to say what his position was. But all those who spoke in substance in relation to it were of that view. That approach reflects broadly the division in the Select Committee. The noble and learned Lord, Lord Lloyd of Berwick, was much keener to enforce these rights by proceedings than anybody else in the committee. The position he has just stated reflects his stance but it is not the position of noble Lords supporting these particular amendments.
Viscount Bledisloe:The noble and learned Lord is not entirely right. I was saying that I am not seeking by the words in Amendment No. 10 to render the provision justiciable. Whether or not it is to remain justiciable by Amendment No. 16 is a totally separate question. I was saying that in no way am I seeking by the back door, with Amendment No. 10, to render it justiciable. I have not yet spoken on the question of whether or not I think it should be justiciable.
Lord Falconer of Thoroton:Again both the noble and learned Lord, Lord Lloyd of Berwick, and the noble Viscount, Lord Bledisloe, are entirely right. Although they did not mention it in their speeches, the noble and learned Lord, Lord Lloyd of Berwick, does want the provision to be justiciable and the noble Viscount, Lord Bledisloe, is not yet telling us whether he want it to be justiciable. I apologise for not making both those points clear. But—in my own defence
they had not said it.
The amendments deal with a very serious matter, which is of huge significance, and the wording requires considerable thought. I do not say that we can get it better than "have regard to" considering what one seeks to achieve in this subsection. I shall set out our thinking and then deal with the specific amendments.
As I said yesterday in response to the rule of law amendment, it is not the intention to work radical changes to general constitutional principles outside the scope of the Bill. The "have regard to" language in Clause 1(4) was decided upon to ensure that the

1307
Lord Chancellor has a duty to act in accordance with the stated objectives while at the same time acknowledging that policy formulation and the substance of decisions must be for him but subject to that duty; that delivery of the objectives is not always within his exclusive gift; and that his existing constitutional position as a member of the Cabinet should not be undermined. I hope that it is obvious to Members of the Committee that the present wording of Clause 1(4) in no way detracts from the fact that the Lord Chancellor will be bound, along with all other Ministers, by the general duty to uphold the independence of the judiciary in Clause 1(1). This preserves collective responsibility because the same duty will be applied to all Ministers.
The amendments tabled by the noble Viscount, Lord Bledisloe, would impose on the Secretary of State an absolute duty to take whatever steps were necessary to ensure that the outcomes in Clause 1(4) were achieved. That would leave the Secretary of State exposed to judicial review on the merits of the question of what is and what is not a necessary step to achieve the objective in question. That would be completely unprecedented; it would impose an unacceptable burden on policy formulation and decision-making by the Lord Chancellor.
The problem would be particularly acute given that informed and reasonable opinion could differ substantially on the question at issue, particularly in relation to such controversial matters as the rule of law which are still in the clause. That may not be a very good point to make if the noble Viscount is putting that to one side for the purposes of this part of the debate. The amendment also fails to take account of the broader picture. As I said, the objective specified will not always be in the exclusive gift of the Lord Chancellor; the same is the position now. It therefore does not make sense to impose an absolute duty on the Lord Chancellor as the noble Viscount's amendment would do.
There is one further reason why I oppose the noble Viscount's amendment. It fails to take proper account of the role of the Lord Chancellor in the context of Parliament. The absolute legal duty created by the amendment would apply to the Lord Chancellor when he was exercising functions in connection with parliamentary proceedings. As the duty would be in absolute terms, with no reference to such proceedings, questions could arise on the legality of the Lord Chancellor's actions in Parliament, including his position on Bills and the content of his speeches. I am sure that the content of some of my speeches would have been alleged to contravene parts of the proposal that the noble Viscount makes in his amendment, but I cannot believe that that is what he had in mind.
I will not deal with the amendment tabled by the noble and learned Lord, Lord Lloyd of Berwick, as he will deal with it separately.
Amendment No. 9, spoken to by the noble Lord, Lord Goodhart, would insert the words "must respect" in place of "have regard to". An obligation to have regard to something has accepted meaning in
1308
public law; an obligation to respect something does not have the same meaning. That may not be a reason not to support it, as it may be an indication that it is not intended to be justiciable. It would, however, be a step into the unknown. It might be stronger or weaker than the duty imposed by the existing text; we simply do not know in legal terms. The Lord Chancellor would have difficulty in determining what he had to do to comply with the duty. That would not be an acceptable outcome of our deliberations on the Bill.
Having said that, I note noble Lords' concerns about whether the wording is adequate. I will think about it, not with a view to coming back with something that leads to the possibility of legal proceedings, but with a view to coming back with something that, if possible, reflects—as the noble Lord, Lord Windlesham, said, although these were not quite his words—the appropriate importance of the duty being imposed. I take that to include all the sorts of things that the noble Lord was saying. "Gravity" would be an even better word. In those circumstances, I invite noble Lords either to withdraw or not to move their amendments.
Lord Richard:Before my noble and learned friend sits down, perhaps he could help me with a point. I accept entirely what he says about the absolute duty that Amendment No. 10 imposes. Does he have the same problems if it ceases to be necessary actions and becomes actions which are reasonable? I am not sure whether that creates the same problems.
Lord Falconer of Thoroton:Inserting the word "reasonable" would direct one much more towards court it would have a court feel. Therefore, I would be worried about the justiciability issue.
I have not yet answered the noble Lord, Lord Brennan. I would not necessarily wish to restrict Clause 1(1) to the factors in Clause 1(4). Clause 1(1) imposes a duty on all Ministers; Clause 1(4) refers specifically to the Secretary of State for Constitutional Affairs. It may go wider than the duty on the Secretary of State or the Lord Chancellor in Clause 1(1).
Lord Brennan:That was my intent. Perhaps my noble and learned friend can clarify a point that arose in debate last night and he mentioned several times in his closing remarks on this amendment. Do I understand him to be saying that the Government read Clause 1(1) as meaning that every Minister of the Crown owes the duty to support this guarantee whether or not that Minister is involved in matters relating to the judiciary?
Lord Falconer of Thoroton:Yes, that is how I read it.
Lord Brennan:I am grateful.
Lord Goodhart:We have had an interesting, if slightly chaotic, debate. On our Amendment No. 9, 1 have no absolute commitment to the word "respect" and shall consider possible alternative words.

1309
However, I remain of the view that "have regard to" is an inadequate form of words. I am grateful to the noble and learned Lord for saying that he would think about the matter, although without any great enthusiasm for a change. I, too, will think about it. Depending on what happens in the interim. I may come back at a later stage with either this or alternative wording in a similar amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Boston of Faversham):I must point out to the Committee that if Amendment No. 10 is agreed to, I cannot call Amendments Nos. 11 to 13 inclusive.
[Amendment No. 10 not moved.]
[Amendments Nos. 11 to 13 not moved.]
Lord Falconer of Thorotonmoved Amendment No. 14:
Page 2, line 5, at end insert—
"(5) In this section "the judiciary" includes the judiciary of any of the following—
(a) the Supreme Court;
(b) any other court established under the law of any part of the United Kingdom;
(c) any international court.
(6) In subsection (5) "international court" means the International Court of Justice or any other court or tribunal which exercises jurisdiction, or performs functions of a judicial nature, in pursuance of—
(a) an agreement to which the United Kingdom or Her Majesty's Government in the United Kingdom is a party, or
(b) a resolution of the Security Council or General Assembly of the United Nations."
The noble and learned Lord said: I spoke to this amendment yesterday. I beg to move.
On Question, amendment agreed to.
Viscount Bledisloemoved Amendment No. 15:
Page 2, line 5, at end insert—
"( ) So far as it is possible to do so, primary legislation and subordinate legislation must be read and given effect in a way which is compatible with the independence of the judiciary and the rule of law."
The noble Viscount said: This amendment seeks to give effect to a point made to the Select Committee by Lady Justice Arden on behalf of the working group of the Judges' Council. Rather than put it in my own words, I shall venture to read as my argument from paragraph 77 of the report. On behalf of the working group of the Judges' Council, Lady Justice Arden argued that Clause 1,
"should be given some enhanced status to prevent inadvertent implied repeal. It is not a question of entrenching it because it would be open to Parliament to depart from judicial independence if it wished to do so, although it would have to use clear language. The enhanced status would be achieved by imposing an interpretive obligation along the lines of section 3 of the Human Rights Act 1998. That provides that, so far as it is possible to do so, primary and subordinate legislation must be read in effect in a way which is compatible with convention rights. We suggest that
1310
that could be adapted to Clause 1 of the Constitutional Reform Bill and what goes for the independence of the judiciary goes for the rule of law as well if Parliament thought it right to include that in Clause 1 or a similar Clause".
Of course, the amendment also suffers, for present purposes, from the fact that it includes, "the rule of law", when we do not yet have that in the Bill and we have not yet decided how that is to be dealt with. I invite the noble and learned Lord the Lord Chancellor to say that he is in principle agreeable to the proposition advanced by Lady Justice Arden on behalf of the Judges' Council, and that he will give effect to an amendment on those lines, though as I said because of the rule of law point, one cannot press it at the moment. I beg to move.
6.30 p.m.
Lord Maclennan of Rogart:Amendments Nos. 15 and 16A that are grouped seem somewhat oddly placed in a clause that is directed towards spelling out the duty of the Lord Chancellor. The amendments appear to seek to impose a duty on the courts, a restrictive interpretation, which is a bid to entrench the provisions of Clause 1.
Amendment No. 15 seems in a sense otiose, even if it is in the right place in the Bill. If one pauses to consider, it is inconceivable that judges would interpret legislation, be it primary or subordinate, in a way that suggested that it was not intended to be compatible with the independence of the judiciary and the rule of law. It seems to me that in her evidence Lady Justice Arden was making a proposition that is certainly unconventional in our constitutional law. We have not normally espoused the methods of entrenchment of the kind that she suggested. Judges are free to interpret the law as they like, but something that is plainly incompatible with the independence of the judiciary and the rule of law is unlikely to be a matter giving rise to great doubt as to the intentions of Parliament. It also seems inconceivable that such a measure would have reached the statute book without the intentions of Parliament having been made clear.
Amendment No. 16A appears to seek to draw on the experience of the Human Rights Act to empower a declaration of incompatibility to be given by the court. That raises grave questions of uncertainty. Here, to some extent, I embrace the arguments advanced on an earlier amendment by the noble Lord, Lord Brennan, about what is meant by "the rule of law". In the case of the Human Rights Act on which this appears to be based, the provisions of law that a particular new provision is declared to be incompatible are spelled out clearly in law. However, we have no such agreed acceptance as to what is meant by "the rule of law".
I do not think it wise that a general constitutional principle should be translated almost inadvertently into something that it would be open to the courts to seek to interpret in a way that might be unpredictable to Parliament at this stage. That is going too far. In respect to the clause, it is right that the provisions should be there as declaratory of constitutional principle, but they should not be capable of giving rise

1311
to actions in the court based on calling into question the compliance of the Lord Chancellor with the undefined concept of the rule of law.
Lord Kingsland:I am most grateful to the noble Lord for giving way. I would like to be clear about the noble Lord's objections to the expression, "the rule of law", in this context. I presume that, at the time that the European Convention on Human Rights was incorporated in English, law the noble Lord supported that initiative by the Government. If that is so, in principle the noble Lord must accept that it is possible by the methods set out in the amendments— indeed, it is desirable by the methods set out in the amendments— to test primary legislation against the principles set out in the European convention.
If the noble Lord accepts that, the only difference between the requirement to test primary legislation against the rule of law and the requirement to test primary legislation against the convention is that, unlike the convention, the rule of law is not set out in a document that has been interpreted by judges over a period of time. If my analysis is correct, surely the only objection that the noble Lord can have to this amendment, particularly to Amendment No. 16A, is that the rule of law is not set out in specific terms in a legislative document against which primary legislation can be measured.
Lord Maclennan of Rogart:It is clear that the noble Lord, Lord Kingsland, accepts that the parallel between the Human Rights Act, which is set out not only clearly in itself as an Act, but which draws on the whole jurisprudence of the preceding considerations of the European convention in the Strasbourg Court, has given a high degree of particularity to the rules with which particular legislation might be declared incompatible. There is no such particularity about the rule of law. I submit, with respect, that it would be difficult to do that. It would be almost as difficult as to say that the courts would be entitled to strike down a measure because it was incompatible with democracy, which this Parliament is deemed to favour and support. Democracy, the rule of law, and justice are broad constitutional principles—they are not precise rules that are capable of enforcement by the courts. It is legislating without clarity as to what would be the precise consequence to give effect to the amendments that have been set out in this way.
Lord Renton:I should confess that, nearly 30 years ago, I was chairman of the only official committee since 1870 to advise on how Acts of Parliament should be drafted. Another member of that committee was the noble Lord, Lord Richard. We sat for two years, but, unfortunately, after he had been with us for a year, he took up an appointment that caused him to resign—much to my regret.
We laid down principles for ensuring that drafting was clear, legally enforceable and easily interpreted. I confess that I think that Amendment No. 15 would have given us no doubt. However—I say this with the
deepest respect to the noble and learned Lord,
1312
Lord Lloyd of Berwick, for whom we all have the greatest admiration —I am worried about Amendment No. 16A. It says:
"If a court is satisfied that a provision of primary or secondary legislation is incompatible with either the independence of the judiciary or the rule of law it"—
the court—
"may make a declaration of that incompatibility".
I am keeping an open mind about that, and the Committee may feel that it is right. However, although we had, if I may say so, a very strong committee, with two retired Law Lords on it, we were never asked to consider the matter of incompatibility with the independence of the judiciary. We were conscious of the independence of the rule of law.
The Committee may feel that I am making heavy weather of this; I hope not. It is something new. I recollect no statutory provision that required a court to consider incompatibility with the independence of the judiciary. It is not an easy matter. In some circumstances, it may give rise to great problems of interpretation. I mention it just in case the noble and learned Lord, Lord Lloyd of Berwick, would care to make any comment about it or even say that it is something new and something that he would prefer to reconsider.
Lord Lloyd of Berwick:I rise primarily to support Amendment No. 15, moved by the noble Viscount, Lord Bledisloe, for the reasons that he gave. Secondarily, I thank the noble Lord, Lord Renton, for the kind things that he has just said about me. However, I shall duck the question that he asked, by suggesting that it might be answered by the noble Lord, Lord Kingsland, whose name stands first in respect of that amendment. Having ducked that question, I shall speak briefly to Amendment No. 16, which is based, quite simply, on Section 6 of the Human Rights Act 1998, which provides that it is unlawful for a public authority to act in a way that is incompatible with a convention right.
If Clause 1 is to be an effective— I emphasise the word "effective"—substitute for the presence of the Lord Chancellor in Cabinet, which was, as I understood from the debate on 12 March, the original intention of the clause and, I imagine, is still the intention of the clause, it must be given some teeth. Unless it is enforceable, a statement of duty is, in the words of Professor Jolowicz, which we all learnt yesterday, sometimes called "lex imperfecta". I prefer the immortal words of Daisy Ashford, who talked about "piffle before the wind". By themselves, the words mean nothing, unless they are, in some way, enforceable.
The duty is specifically imposed on Ministers by Parliament, and the only way to give it meaning and effect is to say simply that, if a Minister acts in a way that is contrary to the duty imposed by Parliament or proposes to act in such a way, he is acting unlawfully. What on earth could be wrong with that?
I accept that the matter could probably be tested in the courts, although that would be for the courts to decide. The noble Lord, Lord Maclennan of Rogart,

1313
said that that would be undesirable and that there would be too much litigation. There would not. There is no reason to suppose that anybody could bring proceedings to enforce the duty unless he had some locus standi. In the absence of someone with locus standi, it would, in accordance with the ordinary law, be for the Attorney-General to bring proceedings as guardian of the public interest, a well known role of the Attorney-General. It will happen once in a blue moon, no more frequently. It will not happen often because, one hopes, Ministers will not act in breach of their duty.
6.45 p.m.
Lord Maclennan of Rogart:Can the noble and learned Lord recall any instance in which the Attorney-General has brought proceedings against a Cabinet colleague that is at all cognate to the circumstance that he suggests?
Lord Lloyd of Berwick:I am afraid that my hearing aid was not acting correctly. Perhaps I may see the noble Lord afterwards and answer him privately. I did not quite hear what he said.
I am sure that the noble Lord cannot be challenging the idea—I am sure that the noble and learned Lord the Lord Chancellor would not challenge it either—that, in certain circumstances, the Attorney-General has a duty to act on behalf of the public in enforcing a duty owed to the public. It is a well established role for the Attorney-General. It would happen very infrequently, but, in the absence of some form of ultimate fall-back on the power of the courts, the duty means nothing. That is why I propose that the amendment should be made.
Lord Mayhew of Twysden:I respectfully support and endorse what has just been said. Things will have come to a pretty pass —not, in practical terms, a foreseeable pass—if the Attorney-General were to take such steps against one of his own Ministers—I do not mean one of "his own" Ministers; I mean "one of his colleagues". None the less, that does not deprive what is proposed of any force. It will concentrate Ministers' minds. Why? Because, as they contemplate one version of draft legislation as against another, an official will say, "Don't forget, Minister, that this is legally enforceable, and you may get somebody taking you to court on judicial review because you have arguably contravened it". It will concentrate the mind. I have a little experience of such situations, so I regard that as entirely practical and foreseeable.
Lord Richard:I want to make two points. The noble and learned Lord, Lord Mayhew of Twysden, said that such a move would concentrate minds. It may do, but one must ask what it is that would become justiciable according to the amendment tabled by the noble and learned Lord, Lord Lloyd of Berwick.
With the amendment, the Home Secretary would have obligations to uphold the rule of law. Is it being seriously argued that somebody could take the Home Secretary to court on an application for judicial review
1314
because he had not provided enough police in Liverpool? Could the Lord Chancellor be taken to court because he had not provided enough judges in Cleethorpes? Once the doors are opened to such an obligation, the possibilities for and ramifications of judicial—I hesitate to use the word "meddling" because it would not be sufficiently polite to the judges—intervention are enormous.
I cannot believe that when the noble and learned Lord who has just sat down was Secretary of State for Northern Ireland he would seriously have welcomed a situation in which, under an obligation to uphold the rule of law, practically whatever he did in terms of security in the Province would be potentially justiciable presumably by any individual who claimed to be affected by it. It is much too wide. That is my principal argument against Amendment No. 16.
It is all very well for the noble and learned Lord, Lord Lloyd of Berwick, to say that there have to be some teeth. There may have to be a clear statement of what the Minister responsible has to do, but to open the floodgates to the extent that this amendment would, in my very respectful submission to the Committee, is going much too far.
I had thought that the noble and learned Lord, Lord Lloyd, had ungrouped the other two amendments. But as regards Amendments Nos. 15 and 16A, I feel for the poor judge. What does he have to do under Amendment No. 16A? The amendment states:
"If a court is satisfied"
so the judge has to be satisfied—
"that a provision of primary or secondary legislation is incompatible with either"—
of two concepts, which are pretty inchoate and certainly are not expressed, are not defined and are not codified—
"the independence of the judiciary or the rule of law it may make a declaration of that incompatibility".
That would impose an extraordinary burden on a judge.
In effect, that says that a judge should have the power to strike down—or make a declaration of incompatibility, which is much the same thing—an Act of Parliament on the basis that he, the judge, considers that it is incompatible with,
"the independence of the judiciary'
or the operation of the rule of law.
Sitting on this side of the House, holding the views that the House knows that I hold on Europe and European development, I have heard time and again from the Benches opposite arguments about the constitutionality of the absolute necessity for enforcing the sovereignty of Parliament against the great intrusions that are coming from Brussels. One should not hand over to courts the possibility of striking down Acts of Parliament—indeed, whether primary or secondary legislation.

1315
There is a certain inconsistency in the approach put forward in this amendment. To ask judges, in effect, to judge the constitutionality or otherwise of an Act of Parliament is a very dangerous road down which we should not go.
The Earl of Erroll:I should like to comment on that. I have some comments to make on Amendments Nos. 15 and 16A and several to make on Amendment No. 16. I think that what the noble Lord, Lord Richard, has just said is nonsense since Pepper v Hart. In Pepper v Hart, because law passed by the British Parliament was not compatible with the intention of some European legislation, I thought that the courts looked at it and either struck it down or altered it. I do not know the detail.
Lord Richard:The point is that that is a matter put up by way of complaint. In other words, the fact that a British court has to strike something down because it is incompatible with the European Court is a matter of complaint being made by the other side, not a matter of pride.
The Earl of Erroll:The British courts are having to do that already. To say that this is a totally novel concept is not valid. I do not see why, if we are erecting a Supreme Court, it should not be able to defend democracy and itself. Surely, Amendment No. 15 simply states that the court can interpret anything in the correct way according to this Act. Amendment No 16A says that a court can declare that a provision is incompatible which, effectively, will send it back to Parliament for reconsideration. As we move more from common law to statute law, we have to look at other protections and protections to which we are not used. That is my first point. I do not agree with anything that the noble Lord, Lord Richard, said.
Secondly, Amendment No. 16 is very important. As a member of the public, I do not see why any Minister should feel that he is above the law. In some foreign countries, we see that certain leaders are above the law. We do not respect that at all. I do not have any problems with the concept that a Minister should have to obey the law. From what the noble and learned Lord, Lord Lloyd of Berwick, said, I understand that this is an ECHR obligation. So putting it into this Bill will not alter the fact that the matter will be either brought to a British court or to the ECHR if a Minister does not obey the law. Taking the point made by the noble Lord, Lord Richard, I do not think that this has got anything to do with the provision of police whatever. It is about the independence of the judiciary.
Lord Crickhowell:Again, as a non-lawyer, I hesitate to intervene in this debate between many expert lawyers. But I am prompted by the speech made by the noble Lord, Lord Maclennan, who based a great deal of his argument around the effect of these amendments on the rule of law part of Clause 1. Of course, as the noble Viscount, Lord Bledisloe, pointed out, we have not got around to dealing with the rule of law point.
1316
It is worth observing that the Judges' Council and Lady Justice Arden, who were responsible for introducing the whole proposal, did not put forward the proposal in connection with the rule of law at all. On referring to the examination of witnesses and question 713 in Volume 2 of the Select Committee report, the whole cross-examination at that point, and her evidence, was based on the subject of the independence of the judiciary. It was in that connection that Lady Justice Arden suggested that there were relevant precedents and that the matter could be appropriately dealt with in the way that she suggested.
She also made it absolutely clear in response to a number of questions from the Lord Chancellor notably, questions 720, 721 and 722—that she was concerned about inadvertent implied repeal. The noble and learned Lord, Lord Falconer, said that,
"we would all agree that we…would not want inadvertent repeal of, or limitations".
Lady Justice Arden also made it perfectly clear that, ultimately, of course Parliament could make specific enactments and that the principle of parliamentary sovereignty was not in question.
It is at least worth considering whether the proposal put forward by the Judges' Council and by Lady Justice Arden, which was concerned with the independence of the judiciary, can stand up if we take away the rule of law question with all the difficulties that have been legitimately raised about the definition of the rule of law. As the proposal came from the Judges' Council, at least we should consider it on the basis that it proposed it.
My second point concerns the question of legal enforceability where, as noble Lords who heard my speech last night will understand, we have got back to my King Charles's head and the whole question of the enforceability of Clause 1. I apologise to the noble and learned Lord, Lord Lloyd of Berwick, for saying last night that I thought that it was inconceivable that the clause would be made enforceable. Here he is making a perfectly good and effective proposal for making it enforceable, particularly in connection with the independence of the judiciary.
Again, it is worth our considering—we have all these
difficulties that have been accepted about the rule of law issue—whether this is a matter concerning the independence of the judiciary where it would be better to have a legally enforceable clause.
The Earl of Onslow:Perhaps another non-lawyer may intervene but temporarily. I fail to understand, if one puts a duty on someone to do something and then he or she does not do it, that it should not be enforceable in a court of law. There is no point in doing that unless one does.
7 p.m.
Lord Brennan:Those of us who did not serve on the Select Committee have not suffered the contagion of constitutional enthusiasm, which some of its members are displaying in this debate. This is a chapter dealing

1317
with the judiciary, a chapter on constitution. Inevitably there is a desire on the part of a convinced democrat and constitutionally minded person to seek to use such legislation as a vehicle for adding on whatever might take their constitutional fancy as the debate goes on. That is totally inappropriate.
Both of these amendments use the phrase,
"the independence of the judiciary and the rule of law".
The independence of the judiciary, in terms of its definition, occupies some seven or eight pages of the United Nations Basic Principles on the independence of the judiciary covering everything from appointment to security of tenure, unreasonable interference and so forth. So the inchoate nature observed by my noble friend Lord Richard is illustrated as regards the independence of the judiciary just as it is on the rule of law.
Let me give an example. Let us suppose that the Chancellor of the Exchequer, with the agreement of the Cabinet, decided that economic circumstances in the country required a 30 per cent cut in judicial salaries, or even pensions. In many countries it would be plausibly argued that, whatever the intent, that would in fact interfere with the independence of the judiciary because it would affect their security of tenure and their independence from state salary considerations. That has arisen in many countries as a constitutional argument. I simply cannot accept that the phrase, "the independence of the judiciary" has some kind of purist interpretation easily applied by a court which has to determine whether or not it is being observed.
Turning to the rule of law, the debate we are having now may be repeated later, in particular by the noble Lord, Lord Kingsland, in this context, and it is the elision of the phrase "rule of law" with the contents of the Human Rights Act. The preamble to the Act refers to the rule of law, but none of the clauses of the convention and none of the sections of our Act refer to it—and they do so with consideration. That is because the convention and the Act set out specific rights which become justiciable and in respect of which as to legislation there may be a declaration of incompatibility. So it is entirely misleading to invite us to treat the rule of law as readily to be assimilated with the provisions of the Human Rights Act and easily applicable in interpreting clauses if they are amended in this way. That is not so.
The inchoate nature of these two concepts, as my noble friend Lord Richard put it, illustrates how I began. This is a chapter about the judiciary in our constitutional history. We are not accustomed to debating constitutional legislation in this place; it rarely happens. Distinguished though the lawyers are on the Select Committee, I was not able to identify any one of them as a specialist constitutional lawyer, nor do I see one in the Chamber today. When we seek to add a little bit to this chapter, as I call it, we must be extremely conservative.
The time may come when we do consider in this House the general declaratory principles of a constitution. In order to do that, there should be full consultation and full
1318
debate before it reaches this House. The example is that of the American Constitution. The first articles are declaratory. It is in the main the subsequent amendments that cause litigation in the United States because it was by those amendments that specific rights were created as regards freedom of expression and so forth which then became justiciable and enforceable. In America they do not litigate Article 1 of the Constitution, and neither should we, in the debate on this clause or on others, seek to introduce into this legislation about the judiciary general concepts of constitutional significance. If we are tempted to do so, we should look at them with strict intellectual rigour.
Lord Lloyd of Berwick:The difficulty here is that the noble Lord was not present at the meetings of the Select Committee. Throughout the two or three months of our consideration of the Bill, the noble and learned Lord the Lord Chancellor promised us a provision to cover the rule of law. We are still waiting for a provision to cover the rule of law—or at least I think we are, but perhaps I am wrong.
Lord Falconer of Thoroton:The remark of the noble and learned Lord, Lord Lloyd of Berwick, is profoundly unfair, for two reasons. First, the points made by my noble friend Lord Brennan were not remotely related to the detail of the rule of law provision. The noble and learned Lord, Lord Lloyd of Berwick, shakes his head, but they were not. The noble and learned Lord is seeking to imply that the precise terms of the provision affected what my noble friend Lord Brennan said, but they most certainly did not. The point made by my noble friend, one that in my view is entirely fair, was that the way that the rule of law and the independence of the judiciary are drawn in these provisions has a huge effect on the constitution. The noble and learned Lord, Lord Lloyd, seeks to respond to that by saying that I have taken such a long time to produce my rule of law clause that the point cannot readily be dealt with unless we are in Committee. With the greatest respect, that seems wrong.
My second point is that I did indeed produce such a clause.
The Earl of Onslow:I should like to ask the noble Lord, Lord Brennan, a question. Are not the words set out in Clause 1(1),
"must uphold the continued independence of the judiciary",
declaratory?
Lord Brennan:I shall rarely have the opportunity of watching my noble and learned friend the Lord Chancellor leap to my defence, and I am grateful to him for that. But I am able to deal with the point put by the noble and learned Lord, Lord Lloyd, in one particular way. Whatever took place in the Select Committee, and on my reading of the evidence before the Committee, the fact is that these concepts have not been the subject of any refined constitutional analysis. The phrases have been bandied around as if they are easy to understand and generally applicable. They are

1319
not. With great respect to Lady Justice Arden, she herself is a company lawyer. The Judges' Council embraces the entire gamut of the judiciary; I am not aware that any one of them would call himself a constitutional specialist.
I turn to the intervention of the noble Earl. My whole point is that Clause 1 is declaratory, as are most constitutional principles. They are not by their nature intended to be enforceable before the courts. That is why in America the amendments arrived. They did so because people wanted specific rights.
I am sorry to make the point and I am not being critical of the Committee, rather I am simply trying to invite Members on the other side to approach matters conservatively.
The Earl of Erroll:From what the noble Lord, Lord Brennan, has said, I gather that he thinks that because this Bill deals with broad constitutional principles it should not have been brought before this House before it had been discussed properly on a philosophical basis outside. Is that what he is trying to tell us?
Lord Brennan:No, I was saying that this particular Bill is limited in scope which has been reasonably investigated. To extend it beyond its present scope should not take place without the kind of debate outlined by the noble Earl.
The Earl of Onslow:I am sorry to come back to this, but the noble Lord has said that the clause is declaratory and is not supposed to be enforceable. What on earth is the point of passing laws which are not supposed to be enforced? I may not be a lawyer, but I think I understand that that is a silly way to behave.
Lord Brennan:I had already resumed my seat and I shall remain in my place.
Lord Kingsland:The noble Lord, Lord Brennan, said that this Bill is of limited scope; but it is described as the Constitutional Reform Bill and it seeks to enact the biggest constitutional reform of the judicial arm of our country since the Act of Settlement. I must also say that I am rather concerned about the anxiety expressed on the Government Benches about the insertion of "the rule of law" in a document which seeks to guarantee constitutional reform.
There should be nothing surprising to your Lordships' Committee about the amendments under discussion, Amendments Nos. 15 and 16A. The approach they take is entirely familiar; the wording is almost identical to the wording in the Human Rights Act 1998, which was promoted from the Government Benches under the leadership of the noble Lord, Lord Richard.
Amendment No. 15, which concerns the manner in which the courts should interpret primary legislation in the context of the independence of the judiciary and the rule of law, is simply taken from Section 3(1) of the
1320
Human Rights Act 1998. It could be cogently argued that the expression "the independence of the judiciary" is otiose because, I suspect, the 1998 Act has the effect of protecting the independence of the judiciary in exactly the same way as Amendment No. 15. So to the extent that the noble Lord is opposed to the application of Amendment No. 15 to the independence of the judiciary, he would be reneging on legislation promoted by the Government at a time when the noble Lord was the Leader of the House.
That also applies to Amendment No. 16A.
Lord Richard:The noble Lord must not provoke me—at least not too much. I am trying to follow his argument. He said that it is not necessary because there is already law dealing with the point. In which case, why bother?
Lord Kingsland:I said that it was arguable that it was not necessary; not that it was not necessary. The purpose of my argument was to point out to the noble Lord that, far from being a novel constitutional concept, it was introduced by his own Government at the time the noble Lord was the Leader of your Lordships' House and holding the great office of Lord Privy Seal—which, I am delighted to see, still has its usefulness today.
The same argument applies to Amendment No. 16A. The declaration of incompatibility in relation to European convention rights is contained in the Human Rights Act 1998. I repeat that I would be very surprised to discover that the independence of the judiciary was not one of the ingredients of the European convention which was protected under the 1998 Act.
So, far from being a novel concept, the independence of the judiciary as proposed in both amendments simply reiterates a right which already exists—and yet the noble Lord, Lord Richard, seems to want to repudiate it. I accept that the introduction of the rule of law is novel, but not in the sense that it is a novel way of introducing the rule of law in our constitution; it is novel because the rule of law has not yet been set out in a detailed way so as to mimic the approach that our European friends have taken under the convention.
In my submission, much of the rule of law in the United Kingdom is already reflected in the European convention. The only issues that arise are where the standards set by the European convention are not as high as the standards set under the common law. I see no difficulty in our judges developing jurisprudence to fill in those gaps; that has been the task of the common law in this country over the centuries.
I am afraid that there have been some lamentable examples recently of the Government proposing legislation in the sphere of criminal law in which many provisions fall well below the standards that, throughout the 20th century, were regarded as the rightful standards that the prosecution should meet before a conviction was obtained. I have no fear at all at the thought that our judges might continue to develop the common law jurisprudence in relation to criminal law under clauses such as those proposed

1321
to be introduced by the noble and learned Lord, Lord Lloyd of Berwick, and myself. In my view, they are excellent clauses and deserve to be taken seriously by your Lordships' House.
7.15 p.m.
Lord Falconer of Thoroton:The noble Lord, Lord Kingsland, puts his argument clearly and defines the effect of what he is saying very well. Perhaps I may indicate, with the greatest respect, the dangers of what he is proposing.
The purpose of Clause 1 is to seek to impose upon the office holder—who is to be called the Lord Chancellor because of the vote yesterday—similar obligations within government to those of the current Lord Chancellor. Those obligations are intended to be dealt with as part of the Executive, relying upon his special role within it. There is neither a desire for nor sense in making the role subject to court enforcement. It should depend upon the way in which the office holder performs the role; if he or she performs the role badly, then the accountability should be to Parliament and not to the court, as it currently is. Indeed, that view was taken by the Lord Chief Justice in the evidence that he gave to the Select Committee.
That approach is taken because, admirable as the courts are, I do not think that in this country we want the courts to decide what the level of expenditure on police should be. Of course we do not. Nor do we want any suggestion that that kind of issue is justiciable before the courts. Nor do we want—would regard this as an unsatisfactory spectacle —the Attorney-General of the day bringing the Chancellor of the Exchequer to court because it is alleged that he infringed Clause 1(1). Merely to say that that is the position seems to me to give the absurdity to the proposal that the noble and learned Lord, Lord Lloyd of Berwick, is suggesting.
The noble Lord, Lord Crickhowell, who was a member of the Select Committee—but no worse for that—exactly identified the purpose of the amendment, which was more limited than that being advanced now—namely, it was to deal, as Lady Justice Arden said, with the possibility of inadvertent repeal or inadvertent inconsistency with Clause 1 of the Constitutional Reform Bill. That was a possibility that we all recognised, but I think I speak for the Members of the Committee when I say that we did not regard that as a particularly serious threat; we were much more concerned with the bigger issues of judicial independence and what the new office holder would do to give effect to it.
Now, instead of simply dealing with the well-defined and limited point proposed by Lady Justice Arden, the noble Lord, Lord Kingsland, suggests that we should introduce a new body of undefined law—the rule of law. We must remember that the rule of law is not an amorphous concept; it is enforced by reference to specific legal obligations. The noble Lord is saying that although a statute dealing with, for example—and he may have this in mind—previous misconduct evidence
1322
in a criminal trial might have a particular meaning now, before the clause is introduced, it could well be construed as meaning something different as a result of the effect of the reference to "the independence of the judiciary and the rule of law" in the Bill. So he is inviting the introduction of a whole new constitutional concept.
That may well be—I am fairly sure it is—what the
noble and learned Lord, Lord Lloyd of Berwick, wants, but I have absolutely no doubt that that has never been debated before, a point made by the noble Lord, Lord Brennan. It is an extraordinarily wide-reaching proposal. To come to it first in a rather limited clause proposed by Lady Justice Arden, entirely sensibly, seems to me, with the greatest respect, not to be the way in which the Committee of the House should proceed.
I entirely agree with the noble Lord, Lord Brennan, that we should be very rigorous to see what will be the effects of the matters we are proposing. But the noble and learned Lord, Lord Lloyd of Berwick, seeks to go even further than that. With great respect, the noble and learned Lord has not been nearly as clear and straightforward as the noble Lord, Lord Kingsland. He wishes that acts done by a Minister, or proposals made by a Minister, or whatever Parliament does, should always be subject to the template of the rule of law or the independence of the judiciary.
For example, if a Minister were to propose that there be an ouster of judicial review in relation to immigration and asylum cases, rather than the matter being decided by Parliament, it would instead be capable of being dealt with in the courts by proceedings being brought in court, with Parliament being, in effect, denied the opportunity to debate it. Noble Lords may think that that is a good idea if they believe that the courts are the best places to test policy considerations. That is not our constitution at the moment—our constitution provides that Parliament has the opportunity to decide these matters.
So let us be under no illusion that these three amendments—I treat Amendment No. 16 as being in this group, although it is not—would have very farreaching effects. They are intended to give the courts powers that they currently do not have.
May I adopt the argument of the noble Lord, Lord Maclennan, as well? He makes two separate points—first, that the duties were intended to be declaratory only. I accept that. Secondly, this is wholly unlike the Human Rights Act, in which a similar clause compares primary or secondary legislation to a body of rights that has been developed over a long period of time, in respect of which there is a corpus of law, well defined and understandable by the courts, with a proper degree of certainty. I could think of nothing more inimical to the rule of law—and one aspect of the rule of law is certainty—than to have a transformation of the constitutional position in the way in which these three amendments propose.
I am not averse to considering how one gives effect to the very limited purpose that Lady Justice Arden proposes. But I strongly urge the Committee to resist the three Trojan horses which have been proposed, as

1323
they would have such a devastating effect on our constitution and would fundamentally shift the balance from Parliament and the executive to the courts.
Lord Lloyd of Berwick:Before the noble and learned Lord the Lord Chancellor sits down, let us take his own example. Suppose, for example, that the Chancellor of the Exchequer were to propose to appropriate my property without compensation. Does the noble and learned Lord suggest that that ought not to be capable of being judged by the courts in a straightforward example of judicial review?
Lord Falconer of Thoroton:Of course, and it currently is. The Human Rights Act would make that improper.
Viscount Bledisloe:I rise to reply, as the mover of Amendment No. 15.
As the noble and learned Lord the Lord Chancellor describes it, two other Trojan horses have been coupled with Amendment No. 15. However, we must not lose sight of the fact that each amendment is separate and has a different purpose, and that they do not need to be cumulative.
Amendment No. 15 says that, wherever possible, a judge considering any Act other than this shall try to assume that that Act does not interfere with the independence of the judiciary. If, notwithstanding that effort, there is only one meaning which the judge can give to the Act that has been passed, he gives effect to it, notwithstanding the fact that it interferes with the independence of the judiciary. The amendment does not in any way require the courts to strike down anything that Parliament has said; it merely imputes to Parliament a keen desire not to interfere with the independence of the judiciary if it can.
Amendment No. 16A goes somewhat further. It says that if, notwithstanding that exercise, the court has to say that this Act has an effect on the independence of the judiciary, then it can declare so. That is a position further down the line, and it may or may not be a good proposition. But the invalidity of No. 2 does not in any way strike down No. 1. At that point, it extends even further, to Amendment No. 16 itself, which says that actions which are incompatible with the rule of law are unlawful.
It is wholly unfair to attribute to Lady Justice Arden responsibility for either Amendment No. 16 or Amendment No. 16A. The inadequacies of Amendment No. 16—
Lord Falconer of Thoroton:I am not accusing Lady Justice Arden of any iniquity in this. Her position was completely clear throughout—it is not Lady Justice Arden I am contesting but the propositions that underlie the three amendments.
Viscount Bledisloe:What I am objecting to is the noble and learned Lord tarring Amendment No. 15 with the same points he makes against Amendments
1324
Nos. 16 and 16A. The fact that he does not like Amendments Nos. 16 or 16A and has advanced arguments against them is no argument whatever against the validity of Amendment No. 15. That is the only point that I am making.
Secondly, I must apologise to the Committee for failing to make myself clear. I thought that I said, totally clearly, in moving Amendment No. 15 that I ignored and took out the words,
"and the rule of law"
because we have not yet got them on the face of the Bill. None the less, the speech of the noble Lord, Lord Maclennan, dealt largely with the fact that one could not have this amendment related to the rule of law. In further answer to the noble Lord, I have no interest in the geography of the proposal. If it is, as I want, put on the face of the Bill, it can be on the face of the Bill anywhere the noble Lord, as a cartographer, wishes to put it.
Lord Maclennan of Rogart:I am grateful to the noble Viscount for giving way. I defer to his very much greater experience of following how canons of interpretation are applied by the judiciary. My failure to deal with the point he has just made—not about geography but about the effect of Amendment No. 15—was to do with the fact that it seemed otiose in that it dealt with precisely how the judiciary would address a provision that appeared to have that effect. It would follow the plain meaning but would presume that it was not Parliament's intention to repeal such an important provision of law.
Viscount Bledisloe:I was just coming to that. I can quite see that the noble Lord, Lord Maclennan, may regard the amendment as otiose. But it seems rather surprising, if it is otiose, that it was advanced by Lady Justice Arden on behalf of the whole Judges' Council. It is sometimes the case that an Act, in its more natural interpretation, would interfere with the principle of the independence of the judiciary. Assisted by this, Lady Justice Arden and the judges appear to think that it will help them, and who are the noble Lord and I to say that it will not?
On the points made by the noble Lord, Lord Brennan, of course Clause 1 is declaratory. In it the Government set out a constitutional principle about the independence of the judiciary. The Government think that that means something, presumably. Therefore, it is not very difficult to say that the judges shall take that into account when considering statutes.
Finally, on a slightly more frivolous note, the noble Lord, Lord Brennan, raised the question of the effect of a proposal to reduce judicial salaries by 30 per cent in times of stress. Surely he is not unaware of the very important decision in the case called, I think, Board of Inland Revenue v Haddock. It decided that when such a proposal has been made, it is impossible for the judiciary to try any claim by the Inland Revenue or any other claim by a government department, because it

1325
then has a personal interest in it. That very important decision is of course only reported in Misleading Cases by AP Herbert.
Lord Falconer of Thoroton:The issue about judicial salaries is interesting. As everyone knows, in the national emergency in the 1930s such a proposal was made. It involved all public servants including judges having their salaries reduced by a particular percentage. The judges objected on the basis that that would interfere with judicial independence. The Government refused to comply with their demands that their salary not be reduced. There was a stand-off, which lasted until an Act of Parliament was produced that would have reduced their salaries but with which the Government did not then proceed.
Viscount Bledisloe:That is the very point that was considered in the important case of Board of Inland Revenue v Haddock. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 16 to 16A not moved.]
Clause 1, as amended, agreed to.
Lord Evans of Temple Guiting:I suggest that this may be a convenient moment for the Committee to take a break and that we resume again at 8.32 p.m.
[The Sitting was suspended from 7.32 p.m. to 8.32 p.m.]
Lord Falconer of Thorotonmoved Amendment No. 17:
After Clause 1, insert the following new clause—
"GUARANTEE OF CONTINUED JUDICIAL INDEPENDENCE: NORTHERN IRELAND
(1) For section 1 of the Justice (Northern Ireland) Act 2002
(c. 26) (guarantee of continued judicial independence) substitute—
"1 GUARANTEE OF CONTINUED JUDICIAL INDEPENDENCE

The following persons must uphold the continued independence of the judiciary

the First Minister,

the deputy First Minister,

Northern Ireland Ministers, and

all with responsibility for matters relating to the judiciary or otherwise to the administration of justice, where that responsibility is to be discharged only in or as regards Northern Ireland.

The following particular duty is imposed for the purpose of upholding that independence.

The First Minister, the deputy First Minister and Northern Ireland Ministers must not seek to influence particular judicial decisions through any special access to the judiciary.

In this section "the judiciary" includes the judiciary of any of the following—

the Supreme Court;

any other court established under the law of any part of the United Kingdom;

any international court.

1326

(5) In subsection (4) "international court" means the International Court of Justice or any other court or tribunal which exercises jurisdiction, or performs functions of a judicial nature, in pursuance of—

an agreement to which the United Kingdom or Her Majesty's Government in the United Kingdom is a party, or

a resolution of the Security Council or General Assembly of the United Nations."

(2) In section 91(2) of that Act (extent: provisions not restricted to Northern Ireland), before paragraph (a) insert—
"(za) section 1,"."
The noble and learned Lordsaid: These amendments to the Justice (Northern Ireland) Act 2002 will ensure that the provision made by that Act in relation to the guarantee of judicial independence is consistent with the provision to be made by Clause 1 of the Bill.
Section 1 of the 2002 Act, which has not yet been commenced, already contains provisions designed to place those with responsibility for the administration of justice in Northern Ireland under a duty to uphold the continued independence of the judiciary.
In light of the provision to be made by Clause 1 of the Bill, Amendment No. 17 will substitute a new Section 1 of the Justice (Northern Ireland) Act to specify and extend the range of persons upon whom the duty is imposed. Under the new Section 1, the First Minister, the Deputy First Minister, the Northern Ireland Ministers and anyone with responsibility for the judiciary or the administration of justice specific to Northern Ireland will be subject to the duty to uphold continued judicial independence.
The new Section 1 will also provide that in upholding judicial independence, Ministers must not seek to interfere with particular judicial decisions through any special access to the judiciary.
Ministers of the Crown will be subject to the corresponding duties under Clause 1 of the Bill.
Amendment No. 17 also amends Sections 1 and 91 of the Justice (Northern Ireland) Act respectively to define the judiciary in the same terms as Clause 1 and to provide that Section 1 shall have UK-wide territorial extent. This is to ensure that the object of the duties to be imposed by Section 1 of the Justice (Northern Ireland) Act is the judiciary throughout the United Kingdom.
Finally, Amendments Nos. 99 and 100 amend the commencement provisions of the Bill to provide that the clause substituting the new Section 1 of the Justice (Northern Ireland) Act contained in the Bill may be commenced by order by the Secretary of State for Northern Ireland, in line with the commencement arrangements under the Justice (Northern Ireland) Act.
I have previously indicated to the House that I plan to bring forward amendments related to the Lord Chancellor's role in Northern Ireland. I plan to introduce such amendments on Report. I beg to move.
On Question, amendment agreed to.
Lord Campbell of Allowaymoved Amendment No. 18:
After Clause 1, insert the following new clause
"LIMITATION OF THE FUNCTIONS OF THE LORD CHANCELLOR

The office of Lord High Chancellor of Great Britain exists only as to the functions—

of the constitutional role in cabinet to uphold the independence of the judiciary, the rule of law and the due administration of justice;

relating to the Great Seal;

of the parliamentary role as Speaker of the House of Lords in the interests of the self-regulation.

The Prime Minister must recommend to Her Majesty the appointment to the office of Lord Chancellor.

Save as to the exercise of the functions retained under subsection (1), the other functions of the Lord Chancellor are transferred to the Minister."

The noble Lordsaid: In moving this amendment, I shall speak also to the question whether Clause 11 should stand part, which relates to the Speakership. The question whether Clause 12 should stand part, which comes further down the amendment list, has already been spoken to; that clause relates to the abolition of the office of Lord Chancellor. I shall also speak to Amendments Nos. 102 and 103, which propose relevant consequential amendments to the title.
I find myself in a little difficulty because, having attended this debate before the short adjournment, I was totally unable to understand where we were going. However, I shall do my best. I am afraid that my intellect is not capable of dealing with the situation as it now seems to be.
This is a probing amendment, which was tabled on the assumption that Amendment No. 1 might well commend itself in terms of retaining the office of Lord Chancellor. As noble Lords know—although there are not many here—I have throughout sought to retain the position of Lord Chancellor in every relevant speech that I have made in the House in the context of the passage of this Bill and the committee that reported on the Speakership.
As my noble friend Lord Kingsland said, it is not the intention to unravel the architecture of this Bill. The tripartite structure is accepted. I must try to clarify where I stand; I accept that. At this stage, the Bill as amended by the Select Committee is accepted subject to further amendment by noble Lords. I want to try to create a firm basis on which to address the House. I do not think that that has yet been totally established. The proposal will not be retabled on Report without consultation with my noble friend Lord Kingsland and without consideration of any contributions that noble Lords make in today's debate, and it will be considered in the light of any relevant amendments tabled before Report.
I have a difficulty in this regard which I hope to put shortly. I said, and I still say—I said this yesterday—that we have to retain the constitutional role of the Lord Chancellor because concepts such as the independence of the judiciary and the rule of law are not so readily defined or enforceable. I still stand by
1328
that approach. I found myself in some difficulty with the amendments that were sought to be enforced in the courts. I listened, said nothing and wondered. But you have to go one way or the other. My way—I have not had an opportunity to discuss it with my noble friend Lord Kingsland—subject to his agreement, is to assert that the Lord Chancellor shall attend in Cabinet as a legally qualified Member of this House.
Having said that, one has to note that the noble Lord, Lord Richard —who unfortunately is not in his place, but I am not going to say anything particularly unkind—said that there was no real agreement on what the Lord Chancellor was to do, what his functions were or what should be retained. I have brought the report with me in case anybody wishes to challenge that.
Amendment No. 18 proposes retention of the three functions only, all of which have been spoken to on Amendment No. 1 and require no repetition. It is on record; there is nothing more to trouble your Lordships with. As yet no other amendment concerning retained functions has been tabled. The speech of the noble and learned Lord, Lord Lloyd of Berwick, at cols. 1146–1147 of Hansard of 13 July, warrants in my respectful opinion the most serious consideration in that context, the reason being that the scope for this amendment may well be, by the will of the House, extended. It is not for me—I cannot do it—to predict what will happen between now and Report, but when this amendment is retabled, I shall have consulted with everybody and with the noble and learned Lord the Lord Chancellor, and taken into account everything that has been said and the amendments.
There is a point that I think I must take now because it could not be taken before. It is relevant to the retention of the parliamentary role of the Lord Chancellor. So, by leave—it will not take long—I should like to take it now. As regards the retention of the parliamentary role, which is part of this amendment, the Lord Chancellor shall continue to introduce legal Bills of constitutional importance, as, indeed, the noble and learned Lord is doing today, and his predecessor did on the Human Rights Act.
The Lord Chancellor participated in the concordat and the deliberations of the Select Committee, as was graciously acknowledged by the noble Lord, Lord Richard, at col. 1139. That leads one to wonder how on earth the noble Lord could have permitted himself, in the context of retained functions, to say that,
"we are arguing about a name and shell".—[Official Report, 13/7/04; col. 1177]
It beggars belief. We are arguing about substance, and about means. If we do not have the amendments on enforcement in the courts, there is nothing else. They would be the only means of enforcement. How the matter can be treated as a sort of frippery I do not understand. All sorts of things happen in this House; there it is.

1329
8.45 p.m.
I shall not take much more time. Proposed new subsection (1) has been spoken about. On proposed new subsection (2), it is accepted that the Lord Chancellor must be a Member of the House of Lords and legally qualified. I would go to the stake on those matters on appropriate amendments; some have already been tabled by the noble Viscount, Lord Bledisloe. Anyone plucked from the Bar, another place or wherever for that post should be granted a life peerage.
I shall move on to proposed new subsection (3). Having read with great care the contribution of the noble and learned Lord, Lord Lloyd of Berwick, I suspect that, if proposed new subsection (1) should require amendment to omit "only", extension may be needed. But we have to weight an amendment for the acceptance of the House. Then, to include functions other than only the three functions, proposed new subsection (3) would stand. On that basis, the amendment should be re-tabled after consultation with my noble friend Lord Kingsland, taking into account the matters to which I have referred—accepting that the Lord Chancellor be debarred from sitting as a judge and no longer solely responsible for selecting the judiciary, and that in principle a Judicial Appointments Commission be set up. That would leave open the questions of whether he will continue to run the courts and legal aid, and whether there would be a Supreme Court, for which I see no justification and which I shall oppose.
That is the probative basis—I hope that it is at least intelligible and straightforward—on which I beg to move.
Lord Maclennan of Rogart:I rise to oppose the amendment. I shall not detain the House for long.
The Lord Chancellor's functions, as limited by Amendment No. 18, would leave a shadow of the present office and, curiously, retain aspects of it which might at best be regarded as an adjunct, and certainly not essential to the discharge of the role within the Cabinet of seeking to safeguard the rule of law or the independence of the judiciary.
In the Select Committee we received evidence about the Great Seal from a previous holder, the noble and learned Lord, Lord Mackay of Clashfern. There was an entertaining exchange with the present Lord Chancellor about its weight. To be candid, however, the possession of the Great Seal could scarcely be described as a "function" of the Lord Chancellor that is necessary in the 21st century.
As far as the parliamentary role of the Lord Chancellor as speaker is concerned, it may be thought that if the object is to enhance the standing of the office of Lord Chancellor, his presence at debates in this House does little towards that end. Other considerations concerned with the separation of the legislature from the executive seem to outweigh any advantage that might be gained from his sitting on the Woolsack.
1330
The first and most important operative part of the amendment— the function of seeking to,
"uphold the independence of the judiciary, the rule of law and the due administration of justice"
—covers so many uncertainties that it is doubtful that it has any administrative content at all. I am doubtful whether a Minister could sit in the Cabinet with no administrative duties and carry any weight with parliamentary colleagues.
The amendment may reflect some of the thinking that was manifested to the Select Committee by the former Lord Chancellor, the noble and learned Lord, Lord Mackay of Clashfern, who plainly thought it desirable that some of the administrative duties that had been added to the role of Lord Chancellor might be dispersed without loss among other members of the Government. In my judgment, however, that reflected a peculiarly apolitical view of the role. The willingness of the noble and learned Lord, Lord Mackay of Clashfern, to dispose of the duty of being responsible for the administration of legal aid, for example, suggested that he had found it an uncomfortable political task when faced with the claims of other departmental Ministers with calls upon the Exchequer. Although his personal discomfiture was understandable, if one is in charge of the administration of justice, it is not merely cognate to that to be responsible for access to justice; it is an essential part of the job. I do not believe that the recommendations of the noble and learned Lord, Lord Mackay, should carry weight with this Committee.
I hope that I have not wearied the House with those few thoughts on the amendment.
Lord Kingsland:I thank my noble friend Lord Campbell of Alloway for tabling this amendment which he himself described as a probing amendment. I think that it is important to recall that the amendment was tabled long before yesterday's vote. Since the vote, it has become clear that the functions of the Lord Chancellor will be those that the Secretary of State for Constitutional Affairs was intended to have under the Bill. Consequently, we will have a Lord Chancellor with far more extensive responsibilities than those envisaged in the amendment of my noble friend.
I thank my noble friend for offering me the opportunity of conversations with him between now and Report stage. It may be that, in the light of those conversations, he will reconsider the type of amendment that he tables on Report. I suppose that, to some extent, that will depend upon the degree to which I am persuasive in the course of our exchanges.
It is important to recognise that the responsibilities of the Lord Chancellor, as set out in the Bill, can, and in my view should, be extended. I respectfully agree with the noble Lord, Lord Maclennan; it is hard to escape the conclusion that if the Lord Chancellor is to be responsible for the matters contained in the Bill, he should also deal with all questions concerned with access to justice. I also think that there is a powerful

1331
argument for him to remain in control of the court system. I recognise that that raises questions of public expenditure. However, those questions can, I am sure, be dealt with by the presence in another place of a suitably qualified and senior Minister of State.
The question of the responsibilities of the Lord Chancellor beyond those that I have already mentioned is naturally more controversial. The noble and learned Lord, Lord Falconer, already has a number of responsibilities which go further than the ones that I have mentioned. The degree to which those should be retained once the Bill has become an Act seems to me more perplexing.
However, I thank the noble Lord, Lord Campbell, once again for his thoughts on these matters. He was, as ever when he speaks, thought-provoking and I shall certainly think carefully about what he said over the next weeks and, indeed, because we shall soon have the summer break, months.
Lord Falconer of Thoroton:I am very grateful to the noble Lord, Lord Kingsland, for reasserting the position that he made clear yesterday, when he said:
"I emphasise at the outset of the debate that it is not the Opposition's intention to unravel, in any way, the architecture of the Bill; we accept the tripartite architecture in full. Our only concern, encapsulated in Amendment No. 1, is whether the position of the Secretary of State for Constitutional Affairs is sufficiently powerful to carry out the tasks stipulated in the Bill for that role".—[Official Report, 13/7/04; col. 1143.]
Therefore, putting aside the office-holder's title and the office which performs the functions, the position of the Opposition is that the function performed should be that of the Minister responsible for at least the judiciary-related functions and legal aid, that of the person responsible for the independence of the judiciary and the rule of law in Cabinet, and that of the person performing the Minister's function on the Minister's side of the concordat.
As I understand the position of the noble Lord, Lord Kingsland, no comment is made on the role of Speaker of the House of Lords. That is a matter for the House of Lords to decide. I agree with the noble Lord about the broad functions of the person. I do not agree with him about the title, the office or the name, but I lost in relation to that yesterday and it will be put right in another place. But as for what the office does, there is no dispute between us.
The amendment moved by the noble Lord, Lord Campbell of Alloway, proposes a role for the holder, whether he be called Lord Chancellor or otherwise, that is supremely defective in two respects. First, he proposes an office holder with no ministerial responsibility—not the head of the judiciary or a judge, yet someone who is supposed to carry the weight in Cabinet to defend the independence of the judiciary. With respect, that seems unmaintainable. Secondly, he proposes in statute that Parliament—the House of Commons and the House of Lords—should determine the position of the Speaker of this House, which is far better dealt with and, indeed, should be dealt with by this House.
1332
9 p.m.
I hope I have made clear that I would reject quite strongly the model proposed by the noble Lord, Lord Campbell of Alloway, but further and perhaps more significant than my own objections, it would appear that the party of which he is a member and for which the noble Lord, Lord Kingsland, speaks on this occasion also profoundly disagrees with the model he proposes. I hope not just that he will withdraw the amendment on this occasion but that, in the light of what the noble Lord, Lord Kingsland, said, he will be minded not to retable it on Report.
Lord Campbell of Alloway:I thank the noble and learned Lord for having taken the trouble to consider this matter. Certainly, whatever else I am supposed to accept, I do not accept that, because my proposals do not involve ministerial office, that detracts from the fundamental authority or concept of the Great Seal and the proximity to the Monarch and so forth. I think that we are getting bogged down in convenient but irrelevant criticism.
Certainly, I shall not come back without the assent of my own party. This is a very serious matter. It is beyond the scope of histrionics or sarcasm. It has to be treated with great seriousness and I would not presume to come back to this House without the support of my party.
I shall, of course, withdraw the amendment. I thank the noble and learned Lord and my noble friend Lord Kingsland for having spoken. However, I do not accept the suggestion that I should withdraw the amendment on any terms. The only terms are my terms. If, after consideration, my party accepts the order of functions, I shall return. If it does not I would not perhaps return at all. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 19 not moved.]
Clause 2 agreed to.
Clause 3 [Functions of the Lord Chancellor and organisation of the courts]:
Lord Falconer of Thorotonmoved Amendment No. 20:
Transpose Clause 3 to after Clause 8.
The noble and learned Lord said: These are technical and drafting amendments. Before the supper adjournment the noble Viscount, Lord Bledisloe, said to me that he wanted them dealt with at a later stage so that he could have a chance to talk to my officials about them. He had useful conversations with my officials during the Select Committee. My view is that we should move them; but that my officials should speak to the noble Viscount, Lord Bledisloe, and if there are particular points where we have missed something or they could be improved, then I would

1333
undertake to come back on Report with them. I do not think that it would be a good idea not to move them at this stage, so, I am minded to move them now.
Viscount Bledisloe:I think the noble and learned Lord has skipped a page of his brief. I thought he was speaking to Amendment No. 20, which is transposing Clause 3 to Clause 8.
Lord Falconer of Thoroton:I am moving Amendment No. 20, which transposes Clause 3 to after Clause 8 and then there are a large number of amendments in the group. I misunderstood the noble Viscount. I thought he was saying to me before we returned that he would like to look at the long list of technical amendments. If his problem does not relate to that, noble Lords should forget what I have said. I was trying to help him.
The amendments are technical and drafting amendments, which do not affect policy. I would draw particular attention to Amendments Nos. 20 and 76. These two amendments change the ordering of what are currently Clause 3 and the accompanying Schedule 1, so that these will now follow Clause 8 and its accompanying Schedule 4. Clause 3 and Schedule I deal with the judiciary and court-related functions of the Lord Chancellor; Clause 8 and Schedule 4 deal with appointment functions. These changes are required, in part, to pave the way for the introduction of the Northern Ireland functions and to assist the manner in which we are dealing with the extent provisions of Clause 1.
The effect of these amendments is that the existing Clause 1 and its Northern Ireland counterpart will stand alone under the subtitle "Continued judicial independence". The extent of these two clauses will be the United Kingdom, but with the "carve-outs" for Scotland and Northern Ireland.
The next subtitle will be "The judiciary and courts". Counsel has advised that it would be preferable to present current Clause 8 and its schedule—appointment functions—as preliminary. Current Clause 3 and its schedule will then be presented as dealing with the consequences of current Clause 8, as well as bringing in all of the remaining judiciary and court-related functions. This is necessary because the overlap between the current Schedules 1 and 4 is becoming increasingly unsatisfactory and confusing. The extent of the clauses under this subtitle will also be the United Kingdom, other than those clauses dealing with the President of the Courts of England and Wales and the Heads of Justice, which will be limited to England and Wales.
In summary, the other amendments achieve the following. Amendments Nos. 24, 25, and 30 amend Sections 73(1) and 73(3) of the Agriculture Act 1947 and Section 6(6) of the Agriculture (Miscellaneous Provisions) Act 1954, which deal with powers to constitute agricultural land tribunals for hearings, to make provision for procedure relating to the agricultural land tribunal, and to regulate the proceedings of agricultural lands tribunals respectively. These functions
1334
are being transferred—it currently says "the Secretary of State for Constitutional Affairs", but plainly an amendment will be required in the light of the amendment yesterday.
The amendments are technical in nature and serve to remove any uncertainty arising from earlier amendments to the relevant provisions as to the effectiveness of the amendments in the Bill.
Amendment No. 32 provides for consultation with the Lord Chief Justice of Northern Ireland by, and it says, "the Secretary of State for Constitutional Affairs", but that will need to be changed to the Lord Chancellor, in performing the function of creating or altering divisions of the General Commissioners of Income Tax in Northern Ireland.
Amendments Nos. 35, 36 and 37 repeal in the body of the Bill spent provisions, which are already listed under the repeals in Schedule 17 to the Bill. Amendment No. 61 retains provisions incorrectly repealed in the Bill dealing with prescribed parliamentary procedure for statutory instruments relating to regulations made. Amendment No. 38 repeals the Lord Chancellor's functions in respect of the central office of the Supreme Court, while ensuring that the functions of the central office itself remain unaffected.
Amendments Nos. 33, 41 and 73, for consistency, replace a reference to "Secretary of State" with a reference to "Secretary of State for Constitutional Affairs" and replace references to "Lord Chief Justice" with references to "Lord Chief Justice of England and Wales". Amendment No. 64 deletes a duplication, which also contains a printing error. I beg to move.
Lord Renton:It would be very helpful if the noble and learned Lord the Lord Chancellor could explain a little matter. In Schedule 1(5) as it now stands, on page 43, there is a reference in French, which is very unusual in describing an Act of the British Parliament—the Cestui que Vie Act 1707. As a common lawyer, I find the following provision strange:
"Any reference to the Lord Chancellor and keeper or commissioners for the custody of the great seal of Great Britain for the time being in section 1 of the Cestui que Vie Act 1707 is to be construed as a reference to a judge of the Chancery Division".
Can the noble and learned Lord the Lord Chancellor say what that means and whether he intends to perpetuate it?
Lord Falconer of Thoroton:I cannot tell the noble Lord what it means. I am sure that it is extraordinarily sensible to transfer the Lord Chancellor's function to a Chancery Division judge there. Cestui que Vie has some resonance with trust law but I cannot explain precisely how. I defend myself in being unable to explain it by the fact that none of my technical amendments relates to that paragraph. But I shall write to the noble Lord and explain why this—I agree, somewhat eccentric—provision appears.
Viscount Bledisloe:There is here a whole raft of amendments to Schedule 1. The noble and learned Lord has pointed out that Schedule 1 must be amended

1335
in an enormous number of respects to change references to "the Secretary of State for Constitutional Affairs" to "the Lord Chancellor". As I understand it, his department will undertake that laborious task and bring forward all those amendments on Report.
As I understand it, these amendments further amend Schedule 1. We saw some 400 of them in the Select Committee and dealt with them in what turned out to be a very efficacious way. The noble and learned Lord very kindly made available the officials in his department, who had a mastery of the detail such as would have enabled them to answer the question of the noble Lord, Lord Renton. They explained the details of the amendments to the noble Lord, Lord Carlisle of Bucklow, and me. We were able to satisfy ourselves and the Select Committee, to which the role was delegated, on the suggestion of the noble and learned Lord, Lord Howe, to the two of us, that 99 per cent of the amendments seemed wholly acceptable.
I suggested to the noble and learned Lord that we took the same approach here. He has suggested as an alternative that we make the amendments to the Bill now; that we have such a discussion before Report; and that it is then open to us to return to any with which we are not satisfied. I confess that I find that an extremely attractive solution which would save a great deal of your Lordships' time. Speaking for myself, I would be happy to nod through all the amendments to Schedule 1 proposed today on the basis that on Report all the references to "the Secretary of State" will be changed to "the Lord Chancellor", and that it will be open to us to bring forward any individual points on which the officials cannot convince us. If that is the proposal that the noble and learned Lord makes, it is eminently satisfactory.
Lord Howe of Aberavon:I have sat in silence for most of the day, but I wish simply to say how proud 1 feel that the precedent that I suggested in the committee of dealing with this vast raft of mysterious provisions in this informal fashion is being followed in this way. Procedure is always intended to help us and not to get in the way. I commend the wisdom of all concerned and wish them luck during the weeks ahead.
9.15 p.m.
Lord Falconer of Thoroton:One feels more and more that the unpopularity of the Select Committee will get stronger and stronger.
Lord Kingsland:I hope that I am correct in concluding, from what the noble Viscount has just said and from the reaction of the noble and learned Lord, that the noble and learned Lord accepts the noble Viscount's interpretation of the position and also the task of redrafting Schedule 1.
A week or two ago, we sought advice as to whether we should table our own amendments to Schedule 1 and we were advised that that would not be necessary. We are prepared to table our own amendments to Schedule 1 on Report; but if I understand the position
1336
correctly, that is now a task that the noble and learned Lord the Lord Chancellor is content to take on. If he confirms that, I am grateful to him.
Lord Falconer of Thoroton:Yes, I do. I hope that I have made it clear that I read the Committee's decision yesterday as saying that whereas we sought to create a Secretary of State for Constitutional Affairs to perform the functions laid out for the Secretary of State for Constitutional Affairs, the Committee wished the Lord Chancellor to conduct those functions. Unless there is some extremity that I cannot work out at the moment, the consequence of that seems to be that in Schedule 1 the references to "the Secretary of State for Constitutional Affairs" should be replaced by a reference to "the Lord Chancellor".
It seems right that I should do that, on the basis that we need to work through the consequences of what was decided yesterday. I make it clear that I opposed the proposal and did not want to accept it, but that was its effect. That is what we must now help to give effect to while the Bill is in this House.
In relation to the proposal of the noble Viscount, Lord Bledisloe, that he talk with my officials—that is absolutely fine. I thought that that was what I had proposed at the beginning, all those 12 minutes ago, but he rather rudely said that I was reading the wrong bit of my notes, and I apologise for that.
On Question, amendment agreed to.
Clause 3, as amended, agreed to.
Schedule 1 [Functions of the Lord Chancellor and organisation of the courts]:
[Amendment No. 21 not moved.]
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 22:
Page 45, line 24, leave out "after consulting" and insert "with the concurrence of"
The noble and learned Lordsaid: These amendments provide for the transfer of judiciary-related functions of the Lord Chancellor previously omitted from the Bill. They also correct inconsistencies in the transfer options to bring them fully in line with the concordat. The first group of amendments—Amendments Nos. 34, 43, 44, 46, 53, 54, 62 and 65—relate to the transfer of the Lord Chancellor's judiciary-related functions previously omitted from the Bill. These have arisen following discussions with the senior judiciary.
Amendment No. 34, for example, provides for the transfer of the Lord Chancellor's function in Section 4(3) of the Taxes Management Act 1970, which concerns the designation of another special commissioner to act as deputy presiding special commissioner. The amendment provides for the Secretary of State to exercise the function only with the concurrence of the Lord Chief Justice, the Lord President of the Court of Session, and the Lord Chief Justice of Northern Ireland.

1337
In the light of the proposal that we have agreed, perhaps I do not need to go through this. I beg to move.
On Question, amendment agreed to.
Lord Falconer of Thorotonmoved Amendments Nos. 23 to 25:
Page 45, line 25, leave out from "for" to end of line 27 and insert ""Lord Chancellor" substitute "Secretary of State for Constitutional Affairs or the Lord Chief Justice"."
Page 47, leave out line 33 and insert—
"( ) In subsection (1) for the words before "by order" substitute "For the purposes of this section, the Secretary of State for"
Page 47, leave out line 36 and insert—
"( ) In subsection (3) for the words before "may by order" substitute "The Secretary of"
On Question, amendments agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 26:
Page 50, line 30, leave out sub-paragraph (3).
The noble and learned Lord said: This amendment is in a similar category. I will not go through the detail. I beg to move.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 27 to 34:
Page 50, line 34, leave out "this section" and insert "subsection (1)"
Page 50, line 37, leave out "this section" and insert "subsection (5A)"
Page 50, line 37, at end insert—
"( ) In subsection (6) for "this section" substitute "subsection (1)"."
Page 50, line 41, leave out from "subsection (6)" to end of line 42 and insert "for the words before "may, by order" substitute "The Secretary of State for Constitutional Affairs".
Page 51, line 38, leave out sub-paragraph (a) and insert—
"( ) in paragraph (a) for the words from the beginning to "Chancellor" substitute "in paragraph 4(1) the words "after consulting the Secretary of State for Constitutional Affairs" shall be omitted, and for the reference there to the Lord Chief Justice of England and Wales and the reference to the Secretary of State for Constitutional Affairs in paragraph 4(4)";"
Page 54, line 38, after "Justice" insert "of England and Wales or, in Northern Ireland, the Lord Chief Justice of Northern Ireland"
Page 54, line 40, after "Justice" insert "of England and Wales"
Page 55, line 9, at end insert—
"( ) In subsection (3) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs"."
On Question, amendments agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 35 to 40:
Page 57, line 35, at end insert—
"In Schedule 10 (transitional provisions), omit paragraphs 3 and 4."
Page 67, line 2, at end insert—
"( ) omit paragraph (a);"
1338
Page 67, line 31, after "(I)" insert "—
(a) omit paragraph (a);
(b)"
Page 75, line 3, at end insert—
"For section 96 (Central Office) substitute—
"96 CENTRAL OFFICE
The Central Office of the Supreme Court shall perform such business as it performed immediately before the commencement of this Act.""
Page 79, line 21, leave out paragraph 220 and insert—
"( ) Section 36 (assignment of circuit judges to family proceedings) is amended as follows.
( ) That section becomes subsection (1) of section 36.
( ) In that subsection, for "Lord Chancellor may direct" substitute "Lord Chief Justice may, after consulting the Secretary of State for Constitutional Affairs, direct".
( ) After that subsection insert—
"(2) The Lord Chief Justice may nominate a judicial office holder (as defined in section 92(4) of the Constitutional Reform Act 2004) to exercise his functions under this section.""
Page 79, line 27, leave out paragraphs 222 to 224.
On Question, amendments agreed to.
The Duke of Montrose The Duke of Montrose moved Amendment No. 40A:
Page 82, line 10, leave out "13" and insert "413"
The noble Dukesaid: I shall probably refrain from speaking to Amendments Nos. 40A and 41B. I gather that they can be picked up under the excuse that they relate to printing errors. Far be it from me to require the Government to accept an opposition amendment that is unnecessary.
Lord Falconer of Thoroton:Lord Falconer of Thoroton: Far from it. We will accept both amendments.
The Duke of Montrose:I want to speak to Amendment No. 41A. Will the Minister explain to those of us who can, perhaps, be regarded as coming from the bush country beyond Milton Keynes why an amendment such as is contained in Schedule 1 paragraph 236(2), which refers to clauses in the Insolvency Act 1986, cannot refer to them as they stand in that Act? Are the Government proposing that the Act be reprinted? That is probably more than is required by the passing of this Bill. I beg to move.
Lord Falconer of Thoroton:The noble Duke has identified errors, and we accept Amendments Nos. 40A and 41B. Those amendments can be made now.
Amendment No. 41A would replace a reference in paragraph 236(2) of Schedule 1 to Parts 8 to 11, written in Arabic numerals, of the Insolvency Act 1986 with a reference to Parts VIII to XI of that Act, written in Roman numerals. All references in this Bill are in Arabic numerals, rather than Roman numerals, even if they refer to older statutes printed in the latter—i.e. Roman numerals. That follows a legislative drafting convention established by the 1998 working group under the Clerk Assistant of the House of Lords that Arabic numbering should be used in statutes instead of

1339
Roman numbering. If the noble Duke has any problem with that, he should take it up with the Clerk Assistant of the House of Lords, rather than me.
I understand that my officials have discussed the convention with the noble Duke. Having given that explanation—unsatisfactory as he may regard it—I hope that he will not move Amendment No. 41A.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 41:
Page 82, line 38, after "State" insert "for Constitutional Affairs"
On Question, amendment agreed to.
[Amendment No. 41A not moved.]
The Duke of Montrose The Duke of Montrose moved Amendment No. 41 B:
Page 83, line 35, after "subsections" insert "(2),"
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 42:
Page 84, line 25, leave out sub-paragraph (2) and insert—
"( ) For subsection (4) substitute—
"(4) The Secretary of State for Constitutional Affairs may, with the agreement of the Lord Chief Justice, remove any coroner from office for inability or misbehaviour."
( ) In subsection (5) for ", wilful neglect of his duty or misbehaviour in the discharge of his duty" substitute "or wilful neglect of his duty"."
The noble and learned Lordsaid: This group of amendments is in the same category as the earlier ones. I beg to move.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 43 and 44:
Page 87, line 17, at end insert—
"( ) Section 96 (evidence given by, or with respect to, children) is amended as follows.
( ) In subsection (3) for "Lord Chancellor may" substitute "Secretary of State for Constitutional Affairs may, with the concurrence of the Lord Chief Justice,".
( ) In subsection (5)(c) for "Lord Chancellor" substitute
"Secretary of State for Constitutional Affairs"."
Page 88, line 8, at end insert—
"In Schedule 14 (transitionals and savings), in paragraph 1(5) (pending proceedings) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs"."
On Question, amendments agreed to.
Lord Goodhart Lord Goodhart moved Amendment No. 45:
Page 89, line 8, at end insert—
"269A(1) Schedule 4 (authorised bodies) is amended as follows.
(2) For "Lord Chancellor" in each place substitute "Secretary of State for Justice".
(3) For "each of the designated judges" in each place substitute "the Lord Chief Justice".
1340
(4) In paragraph 5 (representation by applicant)—
(a) in sub-paragraph (4), for "give such advice to the Lord Chancellor as he thinks fit" substitute "notify the Secretary of State for Justice whether he concurs with the application".
(b) after sub-paragraph (4) insert
"(5) If the Lord Chief Justice does not concur the Secretary
of State for Justice shall not grant the application."
(5) In paragraph 6 (decision by (Secretary of State)), in subparagraph (1) at beginning insert "If the Lord Chief Justice has concurred with the application and".
(6) In paragraph 6, sub-paragraph ( I ) omit paragraph (c)."
The noble Lordsaid: This is a probing amendment. Schedule 1—or, at any rate, Schedule 1 as it was originally—contains an enormous number of amendments that are consequential on either the change of role or the change of name of the Lord Chancellor. So far as they simply change the name from "Lord Chancellor" to "Secretary of State for Constitutional Affairs", they will, after yesterday's vote, go into limbo. No doubt, they will, in due course, disappear from the Bill altogether. However, not all the necessary changes relating to the role of the Lord Chancellor have, in fact, been made.
In particular, the necessary changes have not been made to what I believe is a very important piece of legislation; namely, Schedule 4 to the Courts and Legal Services Act 1990. That schedule is now not in its original form, but in the form set out in Schedule 5 to the Access to Justice Act 1999, which replaced the original Schedule 4 to the 1990 Act.
Schedule 4 relates to bodies authorised to have rights of audience in the courts and rights to conduct litigation. The schedule is in four parts. Part 1 deals with the power of the Lord Chancellor to designate bodies whose members have rights of audience or rights to conduct litigation. Part 2 relates to the power of the Lord Chancellor to approve alterations of rules made by the designated bodies. Part 3 deals with the power of the Lord Chancellor to impose rule changes on the designated bodies. Part 4 contains a power for the Lord Chancellor to revoke a designation.
From that brief summary, it is obvious that those are very important powers. They were the subject of very considerable debates in the course of the passing of the Bill which became the Access to Justice Act. They are of course important because they impinge on the independence of the legal profession, which I think is nearly equal to the importance of the independence of the judiciary. I have some surprise that this had not already been dealt withor not until I raised this point at a late stage in the proceedings of the Select Committee—by the Lord Chancellor's Department.
All the relevant powers under Schedule 4 are vested in the Lord Chancellor alone. Before exercising those powers, the Lord Chancellor is required to consult a consultative panel set up under Section 18A of the 1990 Act. He is required to consult the Director-General of Fair Trading and the four designated judges; the Lord Chief Justice, the Master of the Rolls, the President of the Family Division and the Vice-Chancellor.

1341
The original Schedule 4, which was replaced by the 1999 Act, gave each of the four designated judges a veto over decisions made by the Lord Chancellor. But that veto was removed in 1999 and the Lord Chancellor was left with sole decision-making powers.
The change in the role of the Lord Chancellor in particular, the fact that he is no longer a judge or head of the judiciary—makes it no longer appropriate for him to have the sole decision-making powers. Equally, it is not appropriate to transfer those powers to the Lord Chief Justice or to the judiciary as a whole. There are of course political issues involved, particularly on competition issues. Leaving Schedule 4 powers solely in the hands of the judiciary would be wrong. I believe that judges would find it difficult to overcome the sense of professional solidarity with the profession from which they have come. There is a danger that if that is left in the hands of the judiciary, there would be no sufficient consideration of the general public interest.
The best solution is to leave the powers to initiate action in the hands of the Lord Chancellor, but to require, as is done in a large number of other circumstances, the concurrence of the Lord Chief Justice. I do not think that we should go back to the original position of the 1990 Act where we had four designated judges, each with an individual power of veto. That is partly as a result of the fact that, under this Bill, the Lord Chief Justice will have a status as head of the judiciary, not just the status of one of a "gang of four", even if perhaps primus inter pares among those four.
I believe that that balance, giving the Lord Chancellor the initiative but requiring the concurrence of the Lord Chief Justice to get the balance right, is what Amendment No. 45 is intended to achieve. However, it is a sample amendment because it extends only to Part 1 of Schedule 4. However, the same principles obviously apply to Parts 2, 3 and 4. I did not feel it necessary to produce identical amendments on this occasion.
I raise this very much as a matter for discussion and I have no intention of pressing it any further on this occasion. I would be interested to hear whether the Lord Chancellor and, indeed, other noble Lords are prepared to accept this analysis and the solution I have proposed. I beg to move.
9.30 p.m.
Lord Mayhew of Twysden:I recall, although without superb accuracy, the time when the formula which the noble Lord seeks to change was legislated; that is, the requirement of the approval or the concurrence of each of the four heads of division. At the time the profession was greatly fraught and felt very strongly about this. I am not at all sure that I am as yet persuaded by the argument put forward by the noble Lord by way of justification for removing the safeguard. I think that matters of, for example, rights
1342
of audience are of immense importance to the independence of the profession, and to the service that can be provided by it.
I would not want this matter to pass wholly without contribution from the Back Benches, which looked likely to be the case.
Lord Falconer of Thoroton:The amendment proposes, in the context of the implementation of the concordat and Schedule 1 to the Bill, to alter the arrangements Parliament has set in place in Schedule 4 to the Courts and Legal Services Act 1990, as amended by the Access to Justice Act 1999. These arrangements relate to the consideration of applications from a body to grant its members rights of audience or rights to conduct litigation, or applications from organisations such as the Bar Council, the Law Society, the Institute of Legal Executives, the Institute of Trade Mark Agents and the Chartered Institute of Patent Agents for approval of changes to their qualification regulations or rules of conduct.
As noble Lords are aware, last July I announced a review of the framework of legal services regulation which is being led by Sir David Clementi. I gave Sir David wide terms of reference. He is looking at the whole regulatory framework and the role and responsibilities within it. The consultation paper issued by his review team earlier this year asked questions about regulatory models and, specifically, about a regulator and the role of the judiciary. The team is analysing the responses to that consultation exercise now and Sir David is due to report to me at the end of the year.
I said at the time, and I think that this is right, that I do not intend to alter the existing arrangements further until I have received his report. When I have considered his recommendations I shall report to your Lordships' House. I do not wish his review to be undermined by any attempt to make new arrangements within the overall existing regulatory structure.
I turn now to the detail of the amendment. When drafting the amendment, it appears that the noble Lord was not aware that the Lord Chancellor's functions under Schedule 4 to the Courts and Legal Services Act 1990 had already been transferred to the Secretary of State for Constitutional Affairs by a transfer of functions order laid before Parliament on 29 July last year. But it is not for that reason alone that I will ask the noble Lord to withdraw this amendment.
The amendment seeks to transfer functions from the Lord Chancellor to a "Secretary of State for Justice", which is a detail we do not need to deal with at this point. It would replace the arrangements under which the Secretary of State receives advice and applications from each of the designated senior judges with an arrangement under which he would receive the view of the Lord Chief Justice only. This would mean that the Lord Chief Justice alone must consider the application and the advice of the Legal Services Consultative Panel and that of the Office of Fair Trading before providing his advice to the Secretary of State or the Lord Chancellor. The proposed amendment does not allow

1343
the Lord Chief Justice to delegate this function to any other senior judge. Given that applications for rights of audience and rights to conduct litigation can be several hundred pages long, it is unlikely that the Lord Chief Justice alone would be able to give the attention necessary to determine if the application should be accepted without introducing considerable delay into the process. That would be neither in the interests of the legal profession nor that of the public.
The designated judges—this reflects the point made by the noble and learned Lord, Lord Mayhew—bring a range of experience and expertise and have, on occasions, brought a range of views for the Secretary of State to consider. Losing this breadth of experience would not be in the interests of the public, who are most affected by changes to the professions' rules. For that reason, too, I would ask the noble Lord to withdraw the amendment.
The effect of the amendment is also to constrain the freedom Parliament has given the Secretary of State to act once he has received the advice of the Lord Chief Justice.
I fully accept, as the noble Lord, Lord Goodhart, said, that these are very important issues, but, in a sense, they arise only by a side wind as a result of the Bill. I said to the noble Lord at the end of the Select Committee that I thought these kinds of matters should be transferred to the Lord Chief Justice. I was plainly wrong. My point is basically to let them stay where they are in the broad architecture until we hear what Clementi has to say. In those circumstances, I hope that the noble Lord will withdraw the amendment.
Lord Goodhart:I shall start by dealing with the point made by the noble and learned Lord, Lord Mayhew of Twysden, who I think misunderstood the point I was making. The protection that was given by each of the four designated judges having a veto would not be removed by my amendment; it was removed by the Access to Justice Act 1999, at a time when I myself took part in the debate and objected to the removal of that protection.
The effect of my amendment would be to restore that protection to a considerable extent by giving a veto not to each of the four designated judges but to the Lord Chief Justice alone. That is a reasonable move because having four judges each with an individual veto was unsatisfactory. The result of that was that any one of the four could have vetoed a change in the rules which was entirely acceptable to the other three designated judges. Giving the veto to one judge, who is now formally recognised as the official head of the judiciary, is a reasonable step to take.
I am somewhat disappointed by the reply of the noble and learned Lord the Lord Chancellor. I am concerned about leaving the position of the professional bodies unprotected when so many other aspects will be protected by requiring the concurrence of the Lord Chief Justice—for instance, in the disciplinary role up until now exercised by the Lord Chancellor.
1344
If this issue is left over to be dealt with in response to the Clementi report, it seems to me that we are very unlikely to have anything incorporated in this Bill. Therefore it follows that further primary legislation is likely to be needed to amend Schedule 4. Given the changed role of the Lord Chancellor, it is a matter of importance that he should not be in a position to impose his own will on the professional bodies which are subject to Schedule 4 to the 1990 Act. It would be appropriate to put into the Bill now a provision that changes can be made only with the concurrence of the Lord Chief Justice.
I would have no objection to rephrasing the amendment—I accept that there are other respects in which it needs to be amended—in a way which would enable further appropriate changes to be made by statutory instrument under the affirmative resolution procedure once Clementi has reported.
However, I would be very unhappy about the idea that the Bill would become law with no further protection given to the professional bodies because, as I said, the independence of the legal profession is very nearly as important as that of the judiciary. Having said that, as I said earlier, I will ask for the leave of the Committee to withdraw the amendment, but I may come back with a further amendment in a somewhat different form to take up the points made by the noble and learned Lord the Lord Chancellor today. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 46 to 75:
Page 89, line 43, at end insert—
"( ) Section 45 (jurisdiction of courts in certain proceedings under this Act) is amended as follows.
( ) In subsections (1) and (6) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs".
( ) After subsection (7) insert—
"(8) The functions conferred on the Secretary of State for Constitutional Affairs by this section may be exercised only after consultation with the Lord Chief Justice.
(9) The Lord Chief Justice may nominate a judicial office holder (as defined in section 92(4) of the Constitutional Reform Act 2004) to exercise his functions under this section.""
Page 90, leave out lines 8 to 14 and insert—
"(3A) The Secretary of State for Constitutional Affairs may remove a Child Support Commissioner under sub-paragraph (3) only with the concurrence of
(a) the Lord Chief Justice of England and Wales, and
(b) the Lord President of the Court of Session.""
Page 91, line 34, leave out paragraph 286 and insert—
In section 13 (power to apply Act to additional tribunals and to repeal or amend certain provisions), for "Lord Chancellor" in each place substitute "Secretary of State for Constitutional Affairs".

1345
Page 92, line 21, at end insert—
"( ) For "appropriate minister" in each place substitute "appropriate person"."
Page 92, line 22, leave out sub-paragraph (2).
Page 92, line 28, at end insert—
"( ) In subsection (12), after the definition of "appointed day" insert—
""the appropriate person" means—

the appropriate Minister in a case which falls within paragraph (a) of the definition of the expression in section 30;

in any other case, the Lord Chief Justice of England and Wales;"."

Page 92, line 30, after "(13)" insert "Where the Lord Chief Justice is the appropriate person, he must obtain the concurrence of the Secretary of State for Constitutional Affairs before exercising any functions under this section.
(14)"
Page 93, line 30, at end insert—
"300A The Value Added Tax Act 1994 is amended as follows.
300B(1) Section 86 (appeals to the Court of Appeal) is amended as follows.
(2) In subsection (1) for "Lord Chancellor may" substitute "Secretary of State for Constitutional Affairs may, after consulting the Lord Chief Justice of England and Wales,".
(3) After subsection (2) insert—
"(2A) The Lord Chief Justice may nominate a judicial office holder (as defined in section 92 of the Constitutional Reform Act 2004) to exercise his functions under this section."
300C In section 97 (orders, rules and regulations), in subsection (1) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs"."
Page 93, line 31, leave out "to the Value Added Tax Act 1994" Page 95, line 31, leave out sub-paragraph (4) and insert—
"( ) In subsection (3) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs"."
Page 95, line 33, leave out "under" and insert "by the preceding provisions of"
Page 95, line 35, at end insert—
"( ) The functions conferred on the Secretary of State for Constitutional Affairs by subsection (3) may be exercised only after consultation with the Lord Chief Justice."
Page 97, line 35, leave out "with the concurrence of" and insert "after consulting"
Page 98, line 30, at end insert—
"Deregulation ( Model Appeal Provisions) Order 1996 (S.I. 1996/1678)
(1) The Schedule (model rules for appeals) to the Deregulation (Model Appeal Provisions) Order 1996 is amended as follows.
(2) In paragraph 6(3)(b) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs".
(3) After paragraph 6(3) insert—
"(3A) The Secretary of State for Constitutional Affairs may exercise his power under sub-paragraph (3) to remove a person appointed to the panel of chairmen for England and Wales only with the concurrence of the Lord Chief Justice."."
1346
Page 100, line 36, leave out paragraph 332 and insert—
"( ) Section 6 (Civil Justice Council) is amended as follows.
( ) In subsection (1) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs".
( ) After subsection (2) insert—
"(2A) The Secretary of State for Constitutional Affairs must decide the following questions—
(a) how many members of the Council are to be drawn from each of the groups mentioned in subsection (2);
(b) how many other members the Council is to have.
(2B) It is for—
(a) the Lord Chief Justice to appoint members of the judiciary to the Council;
(b) the Secretary of State for Constitutional Affairs to appoint other persons to the Council."
( ) In subsections (3) and (4) for "Lord Chancellor" in each place substitute "Secretary of State for Constitutional Affairs".
( ) After subsection (4) insert—
"(5) The Lord Chief Justice may nominate a judicial office holder (as defined in section 92 of the Constitutional Reform Act 2004) to exercise his functions under this section.""
Page 101, line 41, leave out "omit subsection (3)" and insert ", in subsection (3)(a) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs under a power conferred on him"
Page 103, line 15, at end insert—
"( ) Section 10 (appeals against parenting orders) is amended as follows.
( ) In subsection (6) for "Lord Chancellor may" substitute "Secretary of State for Constitutional Affairs may, with the concurrence of the Lord Chief Justice,".
( ) After subsection (7) insert—
"(8) The Lord Chief Justice may nominate a judicial office holder (as defined in section 92 of the Constitutional Reform Act 2004) to exercise his functions under this section.""
Page 110, line 14, at end insert—
"Employment Tribunals ( Constitution and Rules of Procedure) Regulations 2001(S.I. 2001/1171)
(1) The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2001 are amended as follows.
(2) In regulation 3 (President of Employment Tribunals)—
(a) in paragraph (2) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs";
(b) in paragraph (4) for "Lord Chancellor" in the first place substitute "Secretary of State for Constitutional Affairs" and for "Lord Chancellor may" substitute "Secretary of State for Constitutional Affairs may, with the concurrence of the Lord Chief Justice,";
(c) in paragraph (5) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs".
(3) In regulation 5 (panels of members of tribunals), in paragraph (2) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs"."
Page 111, line 8, leave out paragraph 391.
Page 114, line 11, at end insert—
"In section 3 (provision of accommodation) for "Lord Chancellor" in each place substitute "Secretary of State for Constitutional Affairs"."

1347
Page 121, line 32, before second "subsection" insert "under"
Page 121, line 44, leave out paragraph (b) and insert—
"(b) in paragraph (a) for "Lord Chancellor" substitute "Secretary of State or Lord Chief Justice"."
Page 122, line 3, at end insert—
"( ) In subsection (2) for "Lord Chancellor" substitute "Secretary of State"."
Page 126, line 21, leave out sub-paragraphs (1) to (3) and insert—
"(1) This Part of this Schedule contains amendments of or relating to enactments that have already been amended or repealed by provisions of other Acts.
(2) In each case the amending or repealing provision is specified, in relation to the enactment referred to, as the "original amending provision".
(3) An amendment contained in any provision of this Part of this Schedule has effect only until the original amending provision comes fully into force in relation to the enactment referred to in that provision of this Part of this Schedule."
Page 129, line 27, leave out sub-paragraph (ii).
Page 129, line 28, leave out from "for" to end of line 29 and insert "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs"."
Page 129, leave out line 30 and insert"—
( ) After subsection (3) insert—
"(4) The Secretary of State for Constitutional Affairs may exercise his functions under subsection (2)(b) only with the concurrence of all of the following—
(a) the Lord Chief Justice of England and Wales;
(b) the Lord President of the Court of Session;
(c) the Lord Chief Justice of Northern Ireland."
Page 129, line 31, after "Justice" insert "of England and Wales"
Page 130, line 23, leave out ", after consulting" and insert "with the concurrence of"

Page 131, line 40, at end insert—
"Matrimonial and Family Proceedings Act 1984 (c. 42)
484A The Matrimonial and Family Proceedings Act 1984 is amended as follows.
484B (1) Section 40 (family proceedings rules) is amended as follows.
(2) In subsection (1)
(a) for "by the Lord Chancellor together with any four or more of the following persons, namely—" substitute "by a committee known as the Family Proceedings Rule Committee, which is to consist of the following persons—";
(b) before paragraph (a) insert—
"(za) the Lord Chief Justice,".
(3) For subsection (3) substitute—
"(3) The members of the Family Proceedings Rule Committee, other than those eligible to act by virtue of their office, are appointed under subsection (3ZA) or (3ZB).
(3ZA) The Lord Chief Justice must appoint the persons referred to in paragraphs (b), (c) (d) and (e) of subsection (1), after consulting the Secretary of State.
1348
(3ZB) The Secretary of State must appoint the persons referred to in paragraphs (f) and (g) of subsection (1), after consulting the Lord Chief Justice.
(3ZC) A person is to be appointed under subsection (3) or (4) for such period as the Secretary of State determines after consulting the Lord Chief Justice."
(4) After subsection (4) insert—
"(4A) In this section "Secretary of State" means the Secretary of State for Constitutional Affairs."
(5) Omit subsection (5).
(6) In relation to the enactment referred to in this paragraph, the original amending provision is paragraph 278(a) of the Courts Act 2003.
484C (1) After section 40 insert—
"40A PROCESS FOR MAKING RULES OF COURT UNDER SECTION 40
(1) Family proceedings rules must be
(a) signed by a majority of the members of the Family Proceedings Rule Committee, and
(b) submitted to the Secretary of State.
(2) The Secretary of State may allow or disallow rules so made.
(3) If the Secretary of State disallows rules, he must give the Committee written reasons for doing so.
(4) Rules so made and allowed by the Secretary of State—
(a) come into force on such day as the Secretary of State directs, and
(b) are to be contained in a statutory instrument to which the Statutory Instruments Act 1946 applies as if the instrument contained rules made by a Minister of the Crown.
(5) A statutory instrument containing Family Proceedings rules is subject to annulment in pursuance of a resolution of either House of Parliament.
(6) In this section and section 40B—
"Family Proceedings rules" means rules of court made under section 40;
"Secretary of State" means the Secretary of State for Constitutional Affairs.
40B RULES TO BE MADE IF REQUIRED BY SECRETARY OF STATE
(1) This section applies if the Secretary of State gives the Family Proceedings Rule Committee written notice that he thinks it is expedient for Family Proceedings rules to include provision that would achieve a purpose specified in the notice.
(2) The Committee must make such Family Proceedings rules as it considers necessary to achieve the specified purpose.
(3) Those rules must be—
(a) made within a reasonable period after the Secretary of State gives notice to the Committee;
(b) made in accordance with section 40A."
(2) The enactment referred to in this paragraph, for the purposes of paragraph 464(3), is section 40 of the Matrimonial Proceedings Act 1984, and in relation to that enactment the original amending provision is paragraph 278(a) of the Courts Act 2003.
484D (1) In section 41 (fees in family proceedings) for "Lord Chancellor" substitute "Secretary of State for Constitutional Affairs".
(2) In relation to the enactment referred to in this paragraph, the original amending provision is paragraph 278(a) of the Courts Act 2003."
On Question, amendments agreed to. Schedule 1 as amended, agreed to.
Lord Falconer of Thorotonmoved Amendment No. 76:
Transpose Schedule I to after Schedule 4.
On Question, amendment agreed to.
Clauses 4 to 6 agreed to.
Lord Grocott:I beg to move that the House do now resume.
1350
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Patents Bill [H.L.]
Returned from the Commons agreed to with amendments; it was ordered that the Commons amendments be printed.
House adjourned at sixteen minutes before 10 o'clock.

  Northern Ireland: European Parliamentary Election
  Lord Maginnis of Drumglass asked Her Majesty's Government:
  Whether there was effective liaison between Northern Ireland's Chief Electoral Officer and the Chief Constable of the Police Service of Northern Ireland during the recent European parliamentary election; at what locations public order problems occurred; and whether any alleged rioters are to be charged with public order offences. [HL3293]
  The Lord President of the Council (Baroness Amos): This is an operational responsibility of the Chief Electoral Officer for Northern Ireland. He has replied to the noble Lord directly.
  Letter from Mr Dennis Stanley to Lord Maginnis.
  The Electoral Office has a senior police officer from PSNI Headquarters assigned to provide an effective channel for planning and operational matters during the entire period of the preparation for and delivery of every election in Northern Ireland. I have no reason to consider that the work of this officer, or the mechanisms the Chief Constable has put in place to facilitate effective liaison between our respective organisations, is anything less than entirely satisfactory.
  Incidents took place on 10 June during polling at the following locations:

  St Therese Primary School

  Heather Road

  Londonderry

  St Bridget's Primary School

  Carnhill

  Londonderry

  Holy Child Primary School

  Central Drive

  Creggan

  Londonderry

  It is a matter for the Chief Constable as to the prosecution of rioters and I understand he will write to you separately on the matter.
  Lord Maginnis of Drumglass asked Her Majesty's Government:
  How many staff were employed by the Chief Electoral Officer for Northern Ireland in voting centres and at the count during the recent European parliamentary election; how many were employed in 1999; what was the total number of electors on each occasion; and what was the total cost of each election. [HL3294]
  Baroness Amos: Four thousand two hundred staff were employed at voting centres, verification centres and the count for the 2004 European parliamentary election. Approximately 310 of these worked at the count. This compares to a total workforce of 3,500 for the 1999 election where approximately 290 people worked at the count.
  The eligible electorate for the 2004 election was 1,072,669. This compares with an electorate of 1,191,307 in 1999.
  The cost of the 2004 election was approximately £2.75 million compared to £2.254 million in 1999.

  Ulster-Scots Agency
  Lord Laird asked Her Majesty's Government:
  Further to the Written Answer by the Lord President on 17 June (WA 80), which political parties will be officially consulted about the appointment of a new chairman to the Ulster-Scots Agency. [HL3406]
  Baroness Amos: We will consult any parties who appear to us to have an interest in this appointment.

  Global Conflict Prevention Pool
  Lord Ahmed asked Her Majesty's Government:
  Whether they will consider widening the scope of the Department for International Development to include the work of the Global Conflict Prevention Pool. [HL3747]
  Baroness Amos: DfID has been part of the Global Conflict Prevention Pool (GCPP) since its inception in 2001. The GCPP is a tripartite mechanism and DfID works with the FCO and MoD to develop strategies for conflict prevention in 14 different geographical and thematic areas.
  DfID is represented on the GCPP steering team, and on each of the 14 tripartite strategy committees. DfID is the GCPP lead on the security sector reform and small arms and light weapons strategies. The Secretary of State for International Development, the Foreign Secretary and the Secretary of State for Defence oversee the work of the GCPP through a Defence and Overseas Policy (DOP) sub-committee.
  DfID's 2004 departmental report estimates that DfID spent £25.5 million through the GCPP in 2003—04. Some examples of DfID's work through the GCPP include:
  supporting the UN to halt the proliferation of small arms and light weapons;
  promoting responsible journalism in conflict hotspots in the Former Soviet Union;
  police reform in Nepal;
  supporting UNICEF's work to protect children caught up in armed conflict.

  Zimbabwe Community UK
  Lord Avebury asked Her Majesty's Government:
  Whether they are reviewing grants of asylum to citizens of Zimbabwe obtained with the aid of documentation supplied by "Zimbabwe Community UK"; and what investigations they have conducted into the affairs of that organisation, including the manner in which it obtained a £5,000 lottery grant. [HL3495]
  The Minister of State, Home Office (Baroness Scotland of Asthal): The Immigration Service was already investigating allegations about the activities of Zimbabwe Community UK before they were broadcast by the BBC. It is working with the National Criminal Intelligence Service and is assessing the material the BBC has provided. It would not be appropriate to comment further on the investigations at this stage. Any decision on whether to review grants of asylum to citizens of Zimbabwe obtained with the aid of documentation supplied by Zimbabwe Community UK will be taken in the light of these investigations.
  The group received £5,000 from Awards for All (lottery grant). In assessing applications to this fund a series of checks are made to verify the status, position and activities of the applicant groups.
  We take the allegations very seriously and are in the process of arranging an audit of the checking process and how this group spent the grant. We are asking for a progress report and proof of expenditure, as per the terms of the grant.

  Planning Permission
  Lord Greaves asked Her Majesty's Government:
  Whether the future signing of an agreement made under Section 106 of the Town and Country Planning Act 1990 can be made a condition of the granting and issue of a planning permission. [HL3657]
  The Minister of State, Office of the Deputy Prime Minister, (Lord Rooker): Planning Circular 11/95 provides guidance on the use of conditions in planning permission. The circular advises that conditions attached to planning permissions should be necessary, relevant to planning, relevant to the development permitted, enforceable, precise and reasonable in all other respects. A condition requiring that an agreement under Section 106 of the Town and Country Planning Act 1990 must be entered into is unlikely to meet the tests set out in the circular because the terms of the agreement will not be known at the time permission is granted. The policy relating to planning conditions reflects current case law and helps to ensure fairness and transparency for those involved in the planning process. We have no proposals to change this policy.

  Army Recruitment
  Lord Astor of Hever asked Her Majesty's Government:
  How many recruits to the infantry they anticipate will join in the next six months. [HL3513]
  The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Bach): It is anticipated that some 1,400 recruits will begin their training with the infantry over the next six months.
  Lord Astor of Hever asked Her Majesty's Government:
  Further to the Written Answer by the Lord Bach on 28 June (WA 5), how many individuals who have successfully passed through the recruit selection process for the infantry have been given a date to commence phase one (basic) training after a delay of more than two months; and how many individuals are expected to pass through the selection process but will not commence their phase one (basic) training for over two months in 2004. [HL3514]
  Lord Bach:
  The number of infantry recruits who have been given a training commencement date longer than two months from their date of attestation in 2004 is 467. Of these, some would have requested a delay before starting training due to personal commitments such as jobs, education and holidays. It should be noted that there is a two-month gap between intakes to Parachute Regiment courses due to their popularity, which results in recruits to the Parachute Regiment automatically having a two-month delay before entering training. If Parachute Regiment figures are excluded, the number of infantry recruits who have a training commencement date in excess of two months is reduced to 352.

  Until all current candidates have successfully completed their selection process at recruit selection centres (RSC), it is impossible to say how many will not begin their basic training for over two months. Once a potential recruit has successfully passed RSC, they will be allocated on to the first available phase 1 course that is being run for their chosen career employment group and the time involved may of course vary considerably.

  Military Discipline
  Lord Astor of Hever asked Her Majesty's Government:
  Whether they will appeal the findings of the European Court of Human Rights of 15 June in relation to the cases of Thompson v the United Kingdom, GW v the United Kingdom and Le Petit v the United Kingdom; and [HL3556]
  What effect the findings by the European Court of Human Rights of 15 June will have on the rules governing the conduct of military discipline. [HL3559]
  Lord Bach:
  The cases on which the European Court of Human Rights delivered its judgments on 15 June 2004 relate to proceedings arising in 1996, since when substantial relevant changes to the provisions governing the conduct of military discipline have been made. We are nevertheless considering the judgments carefully to see whether there are implications we need to address.

  Lord Astor of Hever asked Her Majesty's Government:

  What guidance is given to commanding officers in relation to administering summary justice in accordance with the Army Act 1955. [HL3557]

  Lord Bach:
  The Manual of Military Law is the principal source of guidance for commanding officers in relation to administering summary justice in accordance with the Army Act 1955. It also includes guidance on the Custody and Summary Dealing (Army) Regulations 2000 and the Summary Appeal Court (Army) Rules 2000. Training on service discipline matters is provided throughout an officer's career. Commanding officers, wherever they serve, have direct access to Army Legal Service officers at divisional level for advice.

  Ministry of Defence: ECHR Cases
  Lord Astor of Hever asked Her Majesty's Government:
  How many cases the Ministry of Defence has lost in the European Court of Human Rights in the past 12 months; and how many cases remain pending.[HL3560]
  Lord Bach:
  Cases brought in the European Court of Human Rights are brought against HM Government and not against individual government departments. Where the lead department was the Ministry of Defence four cases have been lost in the past 12 months. There are five cases pending.

  Jarvis Plc
  Lord Oakeshott of Seagrove Bay asked Her Majesty's Government:
  In which private finance initiative and public private partnership projects in London Jarvis plc or any of its subsidiaries is:

  the main contractor; and

  a member of a contracting consortium (showing in each case the percentage share of Jarvis plc or its subsidiaries); and for each project, what is the contract period and total value. [HL3614]

  The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey): A list of signed PFI contracts is published on the HM Treasury public website, listing contracts by department, location and region and giving an estimate of the capital value of investment under the contract. Information on consortium membership and the identity of main contractors is not held centrally.
  Lord Oakeshott of Seagrove Bay asked Her Majesty's Government:
  Whether the finances of Jarvis plc are sufficiently robust to ensure that its subsidiary Prismo will meet its obligations for preparatory works for Liverpool City of Culture 2008. [HL3617]
  Lord McIntosh of Haringey:
  The delivery of Liverpool's plans for its year as European Capital of Culture 2008 are a matter for the Liverpool Culture Company. The company has informed me that there is currently no intention for Prismo to be involved in any of its projects. Prismo is one of three framework contractors for future planned work in the city by Liverpool City Council but thus far no work has been awarded to it.

  DCMS: Conflicts of Interest Policy
  Lord Moynihan asked Her Majesty's Government:
  Whether the Department for Culture, Media and Sport will publish its policy on potential conflicts of interest for public appointments and advisers contracted to the department. [HL3351]
  Lord McIntosh of Haringey:
  Yes. Our policy is already public in that potential applicants for public appointment receive the Cabinet Office publication, Guidance on codes of practice for board members of public bodies. We will be updating our application packs over the next few weeks so as to provide more detailed information on conflicts of interest. Advisers contracted to the department, as opposed to "special advisers", are appointed under standard contract terms, which include the need to declare conflicts of interest.

  DCMS: Step into Sport Contract
  Lord Moynihan asked Her Majesty's Government:
  Whether they will provide details of the contractual arrangements in place, including the value of any contracts, between the Youth Sport Trust and the Department for Culture, Media and Sport and its associated agencies for each financial year since 1999–2000. [HL3656]
  Lord McIntosh of Haringey:
  My right honourable friend the Secretary of State for Culture, Media and Sport, in March 2002, let a two-year contract valued at £7 million to a consortium of Sport England, the Youth Sport Trust and the British Sports Trust. The contract was to deliver the Step into Sport project—part of the PE, School Sport and Club Links programme.

  Olympic Games 2012: London Bid
  Lord Jopling asked Her Majesty's Government:
  What is the average total extra charge to be made to London households in the event of London being the host to the 2012 Olympic Games; and over how many years it will be spread. [HL3607]
  Lord McIntosh of Haringey:
  In the event of a successful bid, up to £625 million will come from council tax from Londoners. Council tax is a matter for the Mayor, and it is his expectation that, with the current number of households, this will cost each household on average £199 and will be spread over up to 12 years. The average cost and the time period may reduce depending on the final amount required and any changes to the local tax base.

  Lord Moynihan asked Her Majesty's Government:

  Whether the Secretary of State for Culture, Media and Sport had any evidence to support her statement that London scored badly on the International Olympic Committee's criteria for government support "because of the uncertainty created by the forthcoming mayoral elections" (HC Deb, 28th June, col. 15). [HL3654]

  Lord McIntosh of Haringey:
  London did not score badly for government support. The International Olympic Committee (IOC) awarded London a range of 8–9 out of 10 for the technical criterion "Government Support", the same as all other applicant cities. In addition to this assessment of the level of support, the overall score for the category included a multiplier for feasibility. London and New York had a lower multiplier for feasibility than Paris and Madrid, of 0.8 compared to 0.9. In the terms of the IOC evaluation report 0.8 is rated as "high probability".

  The report of the IOC does not offer any explicit explanation why London and New York were given slightly lower feasibility ratings. However, as part of the information used to score this category, candidate cities were asked to provide information about the frequency of elections before 2005. London was alone in possibly facing two sets of elections that could affect government support for the bid—both mayoral and a potential general election. New York has presidential, congressional and state legislative elections in the bidding period. Paris will have no elections that would significantly affect government or city support, and Madrid had a general election (in March) and will not hold a city or regional ballot before July 2005.

  As part of their response to the Working Group Report the bid company is in discussions with the IOC to establish the underlying reasons for both this marking and the other areas of the file where London scored lower than other cities.

  Piers
  Lord Fearn asked Her Majesty's Government:
  How many piers in England are designated as listed buildings or structures; and what grades have been given to these piers. [HL3649]
  Lord McIntosh of Haringey:
  There are currently 77 listed piers in England. Of these, three are Grade 1, 12 are Grade II* and 62 are Grade II.

  Drivers: Foreign Nationals
  Baroness Masham of Ilton asked Her Majesty's Government:
  Whether foreign nationals from countries which are not considered "designated countries" by the Driver and Vehicle Licensing Agency who have resided in the United Kingdom for more than one year (discounting periods overseas) are permitted to drive in the United Kingdom without passing a United Kingdom driving test. [HL3505]
  Lord Davies of Oldham:
  New residents who hold valid driving licences issued in countries which are not designated in British law for licence exchange purposes must pass a British driving test in order to be able to drive beyond their first 12 months of residence here. The concessionary 12-month period during which they may drive on their valid national licence begins on the date on which they become resident and includes periods they spend overseas.

  New residents who hold licences issued in designated countries may also drive for 12 months from the date they became resident but may exchange their licences for the British equivalent without having to pass a further driving test.

  Visitors to this country with licences issued in non-European Community/European Economic Area countries may drive here for 12 months from the date they last entered the UK, provided their licence remains valid. After 12 months they must stop driving, and they are unable to take a British driving test. This is because British driving licences may only be issued to residents of Great Britain.

  DVLA: Telephone Response Times
  Baroness Masham of Ilton asked Her Majesty's Government:
  What steps they are taking to reduce the waiting time for members of the public telephoning the Driver and Vehicle Licensing Agency. [HL3507]
  Lord Davies of Oldham:
  DVLA has improved the automated advice system, added extra 95 telephone lines and deployed extra staff on its vehicle service.

  Baroness Masham of Ilton asked Her Majesty's Government:

  What is the average waiting time for members of the public telephoning the Driver and Vehicle Licensing Agency. [HL3508]

  Lord Davies of Oldham:
  During the early part of this year the inquiry section at DVLA had to cope with volumes of calls far higher than expected as a result of the introduction of continuous registration. During that period customers had to wait an average of 49 seconds to speak to a DVLA agent on vehicle-related issues. Measures to cope with the additional demand
  WA156
  have been put in place and in June the average waiting time was down to 25 seconds.

  Customers to DVLA's drivers section have experienced an average waiting time of 10 seconds for the first six months of this year.

  Lifeboat Stations
  Lord Fearn asked Her Majesty's Government:
  How many lifeboat stations are situated around the British Isles; and how many offshore lifeboat stations are situated around Britain's coastline.[HL3650]
  Lord Davies of Oldham:
  There are 281 lifeboat stations situated around the British Isles, of which 133 house "all weather" lifeboats suitable for offshore conditions.

  Equality Commission for Northern Ireland
  The Lord President of the Council (Baroness Amos)
  My right honourable friend the Secretary of State for Northern Ireland has made the following Ministerial Statement.

  Under Section 73(2) of the Northern Ireland Act 1998, I have appointed four new commissioners to the Equality Commission for Northern Ireland. They are: Anthony Carlin, Una Gillespie, Thomas McGrath and Paul Yam.

  The appointments take effect from 1 August 2004 and last for three years.

  Laganside Corporation: Annual Report and Accounts 2003-04
  Baroness Amos
  My right honourable friend the Minister of State for Northern Ireland has made the following Ministerial Statement.

  The annual report and accounts of the Laganside Corporation (NIA 42/03) for the year ended 31 March 2004 incorporating the report of the Comptroller and Auditor General will be laid before the Northern Ireland Assembly on Wednesday 14 July 2004.

  Copies of the Northern Ireland Assembly paper have been placed in the House of Commons Library at Westminster and in the Northern Ireland Assembly at Stormont.

  Director of Fair Access to Higher Education
  The Parliamentary Under-Secretary of State, Department for Education and Skills (Baroness Ashton of Upholland)
  My right honourable friend the Minister for Lifelong Learning, Further and Higher Education has made the following Written Ministerial Statement.

  I have today placed in the Library of the House copies of the new draft letter of statutory guidance from the Secretary of State to the Director of Fair Access (commonly known as the Office for Fair Access or OFFA).

  On 23 February 2004 the Secretary of State published the draft regulations and guidance on OFFA as the Higher Education Bill made its way to Committee stage in the House of Commons.

  Since that time the Bill has received Royal Assent and some important amendments have been made. Now that the Bill has become an Act and we have
  WS60
  advertised for the post of the Director of Fair Access, the Secretary of State has issued a new draft letter of statutory guidance to the new director. New draft regulations were published on 7 July and copies laid in the Library of the House.

  We are determined to ensure that access to higher education is broadened, not narrowed. That is why the new Director of Fair Access will have such an important role. Now that we have advertised for the post of director it is important to remind all those interested of the function, powers and responsibilities. OFFA will be necessary, focused, non-bureaucratic, powerful, independent, open and nothing to do with admissions.

  The new director will be in post by the autumn and this letter suggests how he or she might approach the approval and monitoring of institutions' access agreements. The judgments that the director will exercise in ensuring fair access will have far-reaching consequences. His or her freedom to challenge institutions where necessary will be an important safeguard and public reassurance.

  The new draft letter reflects changes made to the Bill. The key changes are:
  Admissions and academic freedom—The HE Act now makes crystal clear, on the face of the legislation, that OFFA cannot infringe on academic freedom, ensuring OFFA is concentrated single-mindedly on widening access.Good practice —A government amendment in both Houses.Part-time education and OFFA—"A government amendment responded to concern expressed in both Houses about the position of part-time students. It makes plain that while OFFA's prime focus is on the regulation of full-time fees its remit includes safeguarding and promoting access to both full-time and part-time study. The amendment sends a clear signal in primary legislation about the importance that the Government attach to part-time study.Reasonableness and sanctions—It is a general principle of law that a body such as OFFA has to act reasonably. This amendment prevents sanctions being imposed if an institution has done all it possibly can to comply with its access agreement. It safeguards institutions from being penalised for problems outside their control. Failure to meet their own milestones is not of itself grounds for any sanction. But where progress is less than expected, OFFA will take into account whether any underlying causes have been identified and addressed by the institution when considering renewal.ReviewߞThis amendment allows institutions to seek a review of decisions made by OFFA to an independent person or panel. The panel will only be able to ask OFFA to look again at a decision, for instance in the light of new information. This is a sensible position for a new regulator, and ensures a fair deal for institutions as well as students.WS61 Gap years—Paragraph 4.2 of the letter reminds institutions that they should not charge higher fees to students who took a gap year and deferred their entry from the 2005–06 academic year to 2006–07.
  The key principles set out in the letter of guidance are that OFFA should be well focused, non-bureaucratic and open to views from within the sector.

  Draft Animal Welfare Bill
  The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty)
  My honourable friend the Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs has made the following Written Ministerial Statement.

  I am pleased to announce today the publication of the draft Animal Welfare Bill.

  The draft Bill seeks to consolidate and modernise over 20 pieces of animal welfare legislation relating to farmed and non-farmed animals, some of which date back to 1911. It follows a public consultation held in 2002, and meetings with over 100 welfare organisations, professional veterinary associations and industry groups.
  WS62
  The Bill introduces into our law a clear definition of cruelty against an animal and provides the courts, the police and government law enforcement agencies with the powers that are needed to deal effectively with people who ill treat or neglect animals in their care. The Bill also extends a duty to promote animal welfare—currently present in farmed animal legislation to all animal keepers. This will mean that all domestic or captive animals must be cared for in accordance with good animal husbandry practices and the best available scientific knowledge concerning welfare needs. This is a major improvement to current welfare laws which are often based on the view that good welfare is about taking action after an animal has suffered.

  The Bill will also provide powers to introduce secondary legislation and codes of practice to protect the welfare of non-farmed animals kept by man. This enabling power is already available for farmed animals and our aim is to ensure that in future all domestic and captive animals will be protected by legislation that can be easily revised to take account of changing welfare needs and increased scientific knowledge.

  Copies of the draft Animal Welfare Bill are available in the Printed Paper Office and the Libraries of the House.

  Copies are also available on the Stationery Office website at http://www.officialdocuments.co.uk/ document/cm62/6252/6252.htm.