Sitting of 16 March 2004

Preamble
The House met at half-past Eleven o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRIVATE BUSINESS
  LONDON LOCAL AUTHORITIES BILL [Lords]
  Considered; amendments agreed to; to be read the Third time.
Traffic Management Bill
As amended in the Standing Committee, considered.

POWER TO INSPECT BLUE BADGES
"(1) Section 21 of the Chronically Sick and Disabled Persons Act 1970 (c. 44) (badges for display on motor vehicles used by disabled persons) is amended as follows.

(2) In subsection (4B) after "a badge" there is inserted -purporting to be".

(3) After subsection (4B) there is inserted—

"(4BA) Where it appears to a constable or enforcement officer that there is displayed on any motor vehicle a badge purporting to be of a form prescribed under this section, he may require any person who—

(a) is in the vehicle, or

(b) appears to have been in, or to be about to get into, the vehicle,
to produce the badge for inspection.

(4BB) In subsection (4BA) "enforcement officer" means—
(a) a traffic warden;

(b) a civil enforcement officer (within the meaning of section 73 of the Traffic Management Act 2004);

(c) a parking attendant (within the meaning of section 63A of the Road Traffic Regulation Act 1984).

(4BC) The power conferred on an enforcement officer by subsection (4BA) is exercisable only for purposes connected with the discharge of his functions in relation to a stationary vehicle.

(4BD) A person who without reasonable excuse fails to produce a badge when required to do so under subsection (4BA) shall be guilty of an offence."

(4) In subsection (4C) after "(4B)" there is inserted "or (4BD)—[Mr. McNulty.]

Brought up, and read the First time.
1.38 pm
he Parliamentary Under-Secretary of State for Transport: I beg to move, That the clause be read a Second time.
The new clause introduces a power for parking enforcement authorities to inspect disabled persons' parking badges, which we know as blue badges, to ensure that they are being used by those who are entitled to do so. My hon. Friend the Member for Milton Keynes, North-East (Brian White) tabled an amendment intended to cover this ground in Committee, where we undertook to consider how to introduce such a provision. I am delighted that we have been able to do so. Perhaps unusually, the measure had the acclamation of the entire Committee, which is why I am even more delighted, creature of consensus that I am, that we have been able to table this new clause.
The new clause addresses an issue that has been of great concern not only to those responsible for parking controls, who obviously have a particular interest in this area; significantly, it has also been of concern to many organisations of disabled people. Badge holders themselves want the disabled persons parking scheme to work effectively for those who need the concessions that it provides for their day-to-day mobility. Abuse of the
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scheme by those who are not entitled to its concessions undermines its credibility, but such abuse can also have a direct and immediate impact on the mobility of disabled people. Car parking places reserved for bona fide badge holders could be blocked by those who display a blue badge but are not entitled to do so. As the House will understand, such abuse can virtually destroy the entire daily schedule of the disabled person concerned.
The new clause will provide all those involved in the enforcement of parking controls with a power to require the driver or passenger—or anyone who they consider is returning to, or leaving, the car—to produce the badge for inspection. It restricts their exercising of that power to times when they are exercising their other functions. If a vehicle is displaying a parking badge but is not using the concessions that the scheme offers—for example, if it is parked in an area without parking restrictions—an enforcement officer will not be empowered to ask that the badge be produced for inspection. That is important to protect genuine badge holders from being targeted when they may have inadvertently left their badge on display.
Those required to produce the badge include the driver, the passenger or anyone who is seen to be leaving, or who is about to return to, the vehicle. So even when the disabled badge holder is not in the vehicle but the concessions are clearly being used, an enforcement officer will still be able to ask the vehicle's occupant to produce the badge for inspection.
In cases where someone unreasonably refuses to produce a badge for inspection, the clause creates an offence. Subject to conviction, a fine will be imposed not exceeding level 3, or £1,000. Guidance will be issued to enforcement officers and responsible authorities, advising them on the appropriate means of involving the police, so as to pursue a prosecution. We also intend that where a badge is not produced for inspection, the enforcement officer will treat that as a prima facie case of unlawful parking and issue a fixed penalty notice or a penalty charge, as appropriate. We do not need to provide for such circumstances in the Bill; the intention is that they will be covered in the guidance that we will produce for enforcement authorities and badge holders.
Mr. Greg Knight: A number of disabled people are concerned about what happens when the badge becomes partly obscured, perhaps because it moved while it was left in the vehicle; indeed, as a result of such an incident, many are given a ticket. If the badge is inspected and found to be in order and the disabled person is entitled to park where the car is parked, will the guidance make it clear that a ticket will not be issued if there is any possibility that such an incident might have been a mere accident?
Mr. McNulty: I undertake to make sure that, if need be, the guidance will make that clear. When it is clear that a perfectly legitimate badge has been obscured, my authority—and doubtless many others— rescinds such parking notices. But if guidance is needed I shall certainly take this issue on board.
On the subject of guidance, we will consult the relevant bodies representing local authorities, enforcement authorities and disability organisations,

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including our statutory advisers, the Disabled Persons Transport Advisory Committee. The guidance will be published before the power is brought into force. This is an important issue that DPTAC has brought to our attention before, and we said that we would seek to legislate at the earliest opportunity.
I am pleased that the Bill allows us to legislate on this narrow enforcement issue, and I anticipate that it will enjoy the support of the whole House. I hope that the House agrees that the new clause addresses a fundamental gap in the enforcement of the blue badge scheme, and that Members will support the Government in its introduction. It seeks to restore the scheme's legitimacy without allowing abuses, and I am grateful to my hon. Friend the Member for Milton Keynes, North-East (Brian White) and other members of the Committee for the way in which this issue was dealt in Committee. Although this measure is a small step in the wider scheme of things, in the context of making a substantive difference to the lives of disabled people, it has a significance far beyond that which we can grant it today. In that context of spirit, harmony and consensus, I commend the new clause to the House and hope to receive the House's acclamation for it, if not for myself.
1.45 pm
Mr. Christopher Chope: We welcome the new clause; indeed, in Committee we supported the previous new clause—new clause 23—when it was discussed. However, I have a couple of questions for the Minister. He mentions the recommendations of the Disabled Persons Transport Advisory Committee, of which the provision before us is a key example. Another issue of equal concern is when the Government will legislate to allow the issuing of blue badges for children aged under two who require the transporting of bulky medical equipment. That is a key issue—albeit for a small group of people—and I should be interested to know when the Minister will legislate on that recommendation.
Secondly, what happens when a person is asked to produce a badge for inspection by a traffic warden, civil enforcement officer or parking attendant, rather than a police officer, and the person of whom the request is made refuses to comply with it? According to the Minister's press release, such officials will have the power to inspect, but surely that is dependent on consent being given to inspection in the first place. How will it be possible to identify a person who refuses to allow the badge to be inspected, and what procedures for enforcement and penalties will flow from such a refusal?
Ross Cranston: I am very pleased that the Government have accepted this recommendation, and I congratulate my hon. Friend the Member for Milton Keynes, North-East (Brian White) on introducing this new clause in Committee. I declare an interest as the honorary president of the Blue Badge Network, which is based in Dudley town centre. As my hon. Friend the Minister said, the validity and credibility of the blue badge system, which is so important to disabled people, needs to be reinforced. As he rightly said, DPTAC made 47 recommendations, of which this is one. The fact that the police and
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enforcement officers will be able to call on those thought to be using such vehicles to produce badges for inspection is a very welcome move.
That, however, is only part of the jigsaw, and I should like my hon. Friend the Minister to say when the guidance will take effect. The DPTAC report rightly points out that powers already exist in respect of the illegal use of badges, and that penalty notices can already be issued to badge holders parked illegally on the street, and to vehicle owners parked in spaces designated for badge holders. However, enforcement is absolutely crucial, and as the hon. Member for Christchurch (Mr. Chope) said, we should consider the important issue of children aged under two. Some indication as to when the guidance will be introduced would be very welcome.
Unfortunately, there seems to be widespread fraudulent use of badges. According to one estimate, there are some 700,000 fraudulent abuses of the badge system. The chief superintendent of the Dudley, North operational command unit says that the number of badges, and the number of abuses of badges, are increasing at an alarming rate, so enforcement is absolutely crucial. An assurance from my hon. Friend the Minister on the implementation of the guidance would also be very welcome.
John Thurso: I, too, am pleased to welcome the new clause, which allows for the inspection of blue badges. It will be greeted warmly by all those who hold blue badges and will make a considerable difference to their lives, enabling them to avoid the frustration they often feel at being unable to use the parking spaces provided for them. It also has the benefit of making the law in England and Wales consistent with that in Scotland, which already benefits from such regulations. We supported the provision in Committee and I am pleased to confirm that we will support it today.
Brian White: As the Minister said, I moved a similar amendment in Committee, and other hon. Members have already mentioned several of the points that I intended to raise. However, it is important for the Government to introduce the guidance as quickly as possible. I am sure that my hon. Friend will seek to do so, but it would be helpful if we had some indication of how quickly it is likely to happen.
Local authorities and the police already have a wide range of powers, and the disabled community will welcome the additional powers of inspection. Just yesterday I exchanged e-mails with one of my regular correspondents, Clive Bailey, who describes himself as a rebellious disabled member of the community. He pointed out the various problems that arise when people misuse parking bays. The power to inspect will make a major difference to the lives of people like him.
As my hon. and learned Friend the Member for Dudley, North (Ross Cranston) pointed out, there is further work to do on other elements of the blue badge scheme, and I seek the Minister's assurance that the Bill will be the vehicle through which the Government will seek to make the necessary additional changes to

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improve the blue badge scheme—the extension to under-twos, for example. The Bill is welcome and I congratulate the Minister on following up my original amendment.
Mr. John Redwood: To complete the harmony of the occasion, I, too, welcome the Government new clause, and I also urge the Minister to produce carefully worded and timely guidance and advice. The guidance needs to be tough in some parts and kind in others. The House would surely agree with me that we should be tough on the low sort of life that tries to cheat on the use of these badges. It is particularly low and dirty to try to gain a badge on false pretences or to seek to use a vehicle carrying a badge when the person using that vehicle is not disabled and is not transporting a disabled person with him. We can all agree on that, and I hope that the guidelines will be tough on such people and that the maximum penalties will be imposed where it has been clearly established that the person fraudulently obtained a badge or fraudulently used a legitimate badge for another user or driver.
I also agree with the important point made by my right hon. Friend the Member for East Yorkshire (Mr. Knight) about dealing with disabled people themselves. There will be times when the authorities will challenge a disabled person in order to check up on legitimate use or concerning the appearance of the badge. In those cases, I hope that it will be done kindly and carefully with the assumption that what really matters is the fact that the proper person was trying to use the facility in the correct way. If some mistakes in how or whether a badge is displayed are made, we should not take a dim view if the right person was seeking to use it for the right purposes.
Anyone who has suffered from temporary disabilities—broken limbs or other accidents—has just a small insight into what it must be like to have to live with even bigger hazards all one's life. We must all have enormous sympathy for such people and I hope that the measure that we are debating today will not make their lives more difficult. I do not want them to be hectored by the authorities trying to enforce the regulations against other people.
Mr. McNulty: I thank hon. Members for their kind words and their welcome for the new clause. I should like to deal with some of the points that were raised.
It was right to point out that the provision by no means exhausts all the DPTAC recommendations, and we are still reflecting on how best to deal with other outstanding matters. There are many different ways of proceeding. My hon. Friend the Member for Milton Keynes, North-East (Brian White) alluded to primary legislation, but there may be other vehicles for achieving what may appear to be only minor changes, which can be enormously important for people with disabilities. For example, we could attempt to rid the legislation of the overladen value judgment in the term "institution", in preference for "organisation". It is beyond the scope of this particular Bill, but it would also be good if we could implement a degree of reciprocity across the EU—
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if I may say that without provoking the current consensus—and a degree of mutual recognition of the system.
The eligibility for the scheme of children under two could be the subject of secondary legislation. We have accepted DPTAC's recommendation to extend the scheme to certain groups of children under two—not least those who constantly require bulky or life-sustaining equipment to be carried around. Draft regulations are being prepared in that regard and we will consult on them later this year—as early as we possibly can. More generally, we are seeking to issue guidance for consultation at the earliest possible juncture. We want to reach a stage where enforcement officers and disabled badge holders are able to understand the full breadth of the guidance before the new powers are introduced. Assuming that the Bill receives royal assent we hope to introduce the powers at the earliest opportunity.
The hon. Member for Christchurch (Mr. Chope) raised an important point about enforcement officers and interplay with the police. We shall seek to ensure that enforcement officers and the responsible authorities advise on the most appropriate means of involving the police in order to pursue a prosecution. The interface with the police is highly important and we want the guidance to make clear, after consultation with the enforcement authorities and the relevant police authorities, the system that will prevail to achieve that. I repeat my undertaking to try to ensure that any guidance should make it clear that, where the badge of an entirely legitimate badge holder has somehow been obscured, the provisions can be revoked.
There are other dimensions of the scheme that we need to reflect on further. We are examining the feasibility of establishing a national database of badge holders, specifying precisely who is entitled to use a badge throughout the country. We shall do some further research on that during the next couple of months. In the longer term, the advent and development of smartcard technology might provide an appropriate way to proceed.
Brian White: On that point, does my hon. Friend agree that the role of carers is crucial?
Mr. McNulty: The eligibility of carers and of people with a clear temporary but debilitating disability—the right hon. Member for Wokingham (Mr. Redwood) referred to them—will require further examination in some detail. Both in the House and beyond, people have broadly welcomed the provisions. The Bill provides a substantive advance, which should be made, but I fully accept that DPTAC's recommendations and a range of other suggestions show that there is further to go before the blue badge scheme will be fully operative in the way we all want. Abuses certainly have a profound impact.
Mr. Chope: In the press release issued today, the Minister says police and parking enforcement officers
"would have new powers to inspect blue badges",
but my understanding is that the new clause will confer powers to ask to inspect. It does not give the enforcement officer the power to put his hand inside the

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car and seize the blue badge. If my interpretation is correct, will the Minister ensure that his press release is amended accordingly?
Mr. McNulty: I do not think I will—not least because it has gone! The release states that seeking the leave of people to inspect is the start of the process. The other end of it, assuming that co-operation is not forthcoming, is, as I have said, a prima facie case of abuse or contravention of the parking rules. In the context of both aspects, calling it a right to inspect is perfectly valid.
Ross Cranston: It may help the House to note that proposed new subsection (4BD) states:
A person who without reasonable excuse fails to produce a badge when required to do . . . shall be guilty of an offence.
I think that the press release is therefore accurate, and that there is no need to try to retract it.
2 pm
Mr. McNulty: My hon. and learned Friend has said in elegant legal terms what I was clumsily trying to express in my own way. I think we will leave the press release as it is.
The right hon. Member for Wokingham spoke about the balance between cruelty and kindness, and called for a degree of flexibility in the guidance so that we focus on the people who transgress. Abuse in this area needs to be regarded as almost as taboo as transgressions such as drink driving. That is absolutely abhorred across the piece now, but only 10 or 20 years ago it was regarded as a bit of laugh. If a person got away with it, that was fine. It is not an overstatement to say that abuse of the blue badge scheme is an outright abuse of the civil rights and liberties of legitimate badge holders. If such people cannot park where they are lawfully entitled to, that can have a profound effect on their entire day.
With the caveat that there is still a way to go on this matter, in the sense that there are more improvements to be made through the incorporation of recommendations from DPTAC and other bodies, I commend the new clause to the House.
Question put and agreed to.
Clause read a Second time, and added to the Bill.

CIVIL ENFORCEMENT OF TRAFFIC CONTRAVENTIONS (GUIDANCE)
"(1) The appropriate national authority may issue guidance to any local authority undertaking civil enforcement powers under Part 6 of this Act or the London Local Authorities and Transport for London Act 2003 about any matter relating to the exercise by it of any power to impose civil penalties for road traffic contraventions.
(2) In exercising their powers of civil enforcement of traffic conventions a local authority shall have regard to any guidance under this section.—[ Mr. Chope.]
Brought up, and read the First time.
Mr. Chope: I beg to move, That the clause be read a Second time.
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When the Minister introduced Government new clause II, he made a slip of the tongue and talked about persecution. This new clause deals with persecution and how to prevent it. It is a plea for common sense, proportionality and reasonableness in the use of civil enforcement powers against motorists. It is a continuation of the Opposition's fight-back campaign on behalf of middle Britain. Motorists and other honest, decent and law-abiding road users are being persecuted and oppressed by unreasonable men and women in uniforms. The persecution is often carried out at the behest of local authority employers, out of greed or hatred of cars and those who drive them.
In Standing Committee, my right hon. Friend the Member for East Yorkshire (Mr. Knight) drew attention to a headline in a Hampstead local newspaper earlier this year— "Traffic Warden Boss Admits He Hates Motorists". The newspaper sent a journalist, operating under cover, for a discussion with the person in charge of the traffic warden service. That person freely admitted that he hated all motorists, and would do all that he could to get at them. It is always important to consider whether a motive is involved, and there is clearly a motive in this case. That is why the Government must act on the matter.
There was a long and lively debate on the morning of 5 February about the enforcement civil penalties for road traffic contraventions. Many examples were given to illustrate how unreasonable some civil enforcement can be. I shall not repeat them all, but earlier this year Nadhim Zahawi, the managing director of the YouGov organisation, was involved in an accident in which his scooter was wrecked. As he was lifted into an ambulance, a £100 ticket was put on his scooter. That was thought to be reasonable.
Another example occurred in the snowy weather at the end of January and the beginning of February. A local authority placed fine notices on cars that had been abandoned because of the snow. That was also regarded as perfectly reasonable behaviour.
Both those examples illustrate unreasonable persecution. The new clause would enable the Minister to protect motorists from the excesses of enforcement officers, whom my right hon. Friend the Member for East Yorkshire called
regulation-ridden, form-filling, pen-pushing nincompoops."— [Official Report, Standing Committee A, 5 February 2004; c. 260.]
The hon. Member for City of York (Hugh Bayley) called them "over-zealous". The Minister said:
"In general, it is reasonable to ask those who enforce parking regulations to use good sense. I believe that in most cases they do: clearly, in some cases, they do not, and we all know of examples. We should encourage local authorities to promote good practice among those who enforce the regulations. For the police, that is generally the case. A police officer will use discretion and good sense, and a little bit of discretion and good sense is needed in enforcing some of the other regulations as well." —[Official Report, Standing Committee A, 5 February 2004; c. 266.]
Mr. Redwood: I am swayed by my hon. Friend's sensible arguments so far. New clause 1 states that local authorities "shall have regard" to guidance, but will he say what penalty or persuasion should be used to ensure that they follow any sensible guidance that is issued?
Mr. Chope: What I have in mind is that any statutory guidance could be taken into account by the adjudicator if an appeal is made. At present, the adjudicator must apply the letter of the law. He cannot allow the discretion that would have been exercised by a sensible police officer or traffic enforcement officer to be imposed on the tribunal. However, statutory guidance would allow adjudicators to take that into account. As a result, motorists would be protected from over-zealous enforcement.
The Minister, in the passage that I quoted, seemed to accept our point that civil enforcement officers do not always exercise the common sense, proportionality and reasonableness that we have come to expect from the police. He said that he was keen to encourage local authorities to promote good practice. The voluntary guidance published in 1995 pursuant to powers contained in the Road Traffic Act 1991 is non-statutory. It is apparent that some local authorities have little, if any, regard for it. The new clause would put that non-statutory guidance on a statutory footing.
The matter is even more important because of the proposals in the Bill to extend the civil enforcement regime to cover moving traffic offences. Some such enforcement is already beginning in London on an experimental basis, but the practice will become much more widespread nationally. That raises the need for statutory guidance.
The Automobile Association has said:
The civil enforcement of parking and traffic offences will be discredited if motorists come to regard it as a revenue gathering exercise rather than a road safety and traffic management issue.
The British Parking Association, in a letter to the Minister dated 1 March, admitted that allegations that some penalty charge notices had been issued improperly were correct. The letter stated:
At present enforcement relies on either the placing of a ticket on a stationary vehicle, handing the ticket to the driver of a stationary vehicle or on the corroborating evidence of a camera. We are concerned that with the advent of civil enforcement for moving traffic offences the uncorroborated evidence of a single enforcement officer will not be considered as adequate or safe by a large proportion of the public. In effect a driver will receive a penalty by post, some time after the alleged offence with no evidence other than the word of a single enforcement officer. . . and very little chance of being able to question or challenge the alleged offence coherently.
The BPA's interest is almost the other way in this matter, but it recognises that some local authorities behave unreasonably when it comes to civil enforcement, and that the Bill's powers in respect of moving traffic offences will cause an even bigger rebellion among the motoring public.
I hope that the Minister accepts that, at the very least, there needs to be statutory guidance to cover moving traffic offences, where the civil penalty cannot be served at the time of an offence and where reliance is placed on the uncorroborated evidence of a single traffic enforcement officer.

The Minister accepts that where traffic offences are decriminalised and the courts are no longer involved, it is necessary to ensure that those aggrieved by the imposition of the penalty charge have recourse to an independent and impartial tribunal. Such a system was set up under section 73 of the Road Traffic Act 1991.
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Unfortunately, the tribunals do not have the discretion to examine issues of reasonableness and proportionality, despite their being referred to expressly in local authority circular 1/95.
Page 38, paragraph 7.6 of the circular states:
Local authorities should ensure that all parking attendants. including supervisors and managers, having the training necessary to provide accurate, fair and consistent enforcement. This requirement applies whether the parking attendants are employed by the local authority or by a contractor.
Paragraph 7.9 states that training should include
The authority's policy for dealing with 'mitigating circumstances' and other matters which require judgment to be exercised (eg. the motorist claiming to be going for change when the PCN is issued; nearest pay-and-display machine out of order, but another machine is close by; claim that meter out of order when PCN issued; motorist claims that voucher, permit etc. was valid when attendant considers it was not; explanatory note left in vehicle.
Common sense and good judgment should be exercised on those issues, but there are currently far too many occasions on which judgment is manifestly not being exercised, and motorists are suffering as a result.
On wheel-clamping, paragraph 8.16 of the circular states:
"Local authorities undertaking when clamping should devise guidelines for when clamping may be carried out … It is important the guidelines can command public support by making the level of enforcement proportionate to the seriousness of the contravention. Wheelclamping may be brought into disrepute if a local authority permits it for what the public may regard as relatively unimportant contraventions.
Vehicle removals are another contentious area, and paragraph 8.28 of the circular states:
Removals should not be carried out in an ad hoc fashion…As with wheelclamping, it is important to ensure that vehicle removals are only undertaken where the seriousness of the contravention warrants this level of enforcement. Inappropriate use of removals may bring an authority's enforcement activities into disrepute.
The problem is that none of that worthy advice from the Government carries any weight with the adjudicator if a local authority chooses to use its enforcement powers in an arbitrary, inflexible and oppressive way.
To put the matter in context, the latest figures show that more than 12,000 parking and bus lane appeals were received in the last three months of last year in London. More than 3,000 of those appeals were allowed, and in 3,266 cases the enforcement authority did not even bother to contest the appeal, resulting in an overall appeal success rate of 57 per cent.—moving traffic offences form a significant and growing part of that total. Most successful appeals and appeals that were not pursued by the enforcement authority should have been rejected at the informal representations stage. That aspect of the process is not working effectively.
Thousands, if not tens of thousands, of motorists cannot be bothered to go through that long process when they know that there is an inflexible law with minimum discretion for the adjudicator in examining the actual facts of the case, so they pay up regardless but under protest. If we had statutory guidance, which new clause 1 seeks, that would be in the past, and we would also be able to deal with the problem of those local authorities—it has been drawn to my attention that

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Somerset, which is under Liberal Democrat control, is one such authority—that have a specific policy to incentivise traffic enforcement officers to go out and maximise revenue to the detriment of the travelling public.
2.15 pm
John Mann: I have listened to the hon. Member for Christchurch (Mr. Chope) with incredulity given his references to the debate in Committee on 5 February in which it would be reasonable to say that I played a prominent part. He is so keen to pursue his long-held ideology of privatising everything and attacking the public sector at all times that one fears that he may have privatised his brain and that the shareholders have just taken a dividend. The debate on 5 February covered not only the public sector but the private sector.
The Under-Secretary of State for Transport, my hon. Friend the Member for Plymouth, Devonport (Mr. Jamieson) issued a letter that specifically refers the 5 February debate, in which I pointed out the difference between private sector operators of car parks and public sector operators of car parks and that private sector operators of public car parks are anomalous. I received the Minister's letter yesterday, which is rather late in the day, and it does nothing to address that anomaly—indeed, it excuses it.
The Minister is highly capable, competent and articulate, and he should know not to rely on information provided by the Department for Transport. He will recall that the Department managed to introduce road humps that failed to take account of where cars are positioned on the road, which were a disaster and unpopular across the country. The same point applies to the information that the Department has provided on civil and criminal enforcement, and the Minister's letter defends the existing legislation and the anomaly within it. An individual fined by a private operator of a private car park can go to a civil court and have their day in court. If a local authority is involved, an individual has the potential remedy of the parking adjudicator. But if a private operator of a local authority car park is involved, an individual can go to neither one nor the other and is therefore criminalised by the case being taken to the magistrates court.
The Minister's letter and new clause 1 both fail to address this point: a private operator with a profit maximisation outlook, which is reasonable if one runs a private company, can put the threat of going to a criminal court to the motorist. The motorist faced with the prospect of going to a criminal court will obviously be intimidated by the potential for criminal proceedings and a criminal record. The evidence from many cases in Bawtry car park, which adjoins my constituency, is that individuals cave in although their tickets should not have been given in the first place. New clause I must therefore incorporate civil enforcement if it is to be of any use to Parliament, motorists and the people of Britain.
Private operators are running public car parks as cash cows. They are raking in 100 per cent. of the money—as at Bawtry car park—and that must be addressed. The Minister, through his civil servants, has attempted to address the anomaly in the legislation, but failed once
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again to address the anomaly in the law, which was demonstrated in Doncaster magistrates court. Such cases are covered by section 112 of the Road Traffic Regulation Act 1984, which defines local authorities as
a county council … a district council, a London borough council and the Common Council of the City of London.
Therefore, neither a parish council nor the private operator of a parish council car park can take people to court. That contradicts the letter that the Minister sent to all members of the Committee—he is wrong and his civil servants are wrong. The issue is small because not many parish councils are stupid enough, anti-motorist enough or greedy enough to try to skin the motorist of money via a private operator. With the publicity that the parish council has received, I cannot imagine that there will be a queue—certainly in my area—of parish councils that wish to skin the motorist in such an unprecedented, unprincipled and greedy way. However, the anomaly could also apply to car parks owned by a county or district council or a unitary authority. Therefore, the issue must be addressed and my hon. Friend the Minister needs to put his mind to it. If the Government are to be on the side of the motorist, we cannot allow the private operators of public sector car parks to skin the motorist by using the threat of criminal proceedings. That has happened time and again, as proved by the evidence that I have provided to his Department.
One should never rely on evidence provided by a cursory examination by a local authority that—as the hon. Member for Christchurch pointed out—may also be on the make by skinning the motorist. For example, local authorities claim that car parking machines across the country are the same. They do not know that, because they did not configure the machines. If the civil servants had read the report of the debate on 5 February they would have seen from Hansard that the manufacturer of the machines, Metric, admits that the tolerance on the machines can be configured by the owner. When configuring a machine, the margins of tolerance are significant enough to determine whether, for example, a 20p piece registers. It is a longstanding issue. Years ago, people who had been abroad could stick old French francs in chocolate machines in place of a shilling to fiddle the chocolate manufacturers. Of course, I would never have dreamed of doing such a thing myself, but we have all heard the stories about such practices.
The question of the tolerance of the machines is fundamental. The owner of a machine can fiddle the tolerance so that a 20p piece stays in the machine but does not register, and the motorist might not notice that. How would the motorist then know that the money that they had paid honestly for car parking had not been registered by the machine? That might lead to the absurdity of a fine. That is a major issue, and I suspect that the scandal of Bawtry car park has been silently replicated across the country and that other hon. Members will he inundated with demands for action if my hon. Friend the Minister does not take action now.
In exposing the weakness in the new clause, with its ideology of privatisation, I have put before my hon. Friend the weakness of the arguments that his civil servants have provided for him. I trust that he will wish

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to reconsider that advice, put the record straight and allow the motorist to win, not the fleecer of the motorist's pocket.
Mr. Redwood: It is a privilege to follow the hon. Member for Bassetlaw (John Mann) after that powerful speech, and I have much sympathy with his condemnation of rapacious car park managers of all kinds. He may be on to something and it is a pity that Ministers have not taken his arguments more seriously so far. It was a little unfair to criticise my hon. Friend the Member for Christchurch (Mr. Chope), because the new clause tries to deal with a wider point about ensuring that sensible guidance is issued to local authorities that may be rapacious enough to see these measures against the motorist as an opportunity to raise revenue rather than to run a disciplined show.
The clauses in question include clause 70, which shows that we are talking about a wide range of contraventions by the motorist. The list includes:
parking contraventions … bus lane contraventions … London lorry ban contraventions … moving traffic contraventions.
It was the inclusion of the latter group that worried my hon. Friends who framed the new clause. The Opposition are concerned by the way in which the motorist has been targeted by some authorities, national and local, as the object of fines for minor infringements of ill-judged regulations. Motorists agree that they are ill judged, and that is why the motorists fall foul of them. I am pleased that my hon. Friends have produced a proposal so that a sensible Secretary of State could offer guidance to local authorities and discipline or control any local authority that might wish to use sensible measures for orderly policing of traffic as a means of raising revenue by exploiting motorists in distress.
I shall not bore the House with many examples, but it is important to consider one or two cases of inadvertent or unavoidable infringements for which a motorist could be hounded if sensible guidance is not offered. One example is bus lane contraventions. Most of the time, it is right that a motorist should observe the restriction on his use of a bus lane. If the bus lane is in operation, whether or not any buses are using it, the motorist knows that he must keep outside the bus lane on what remains of the highway. Let us suppose something happens just ahead of the motorist—an accident, or a motorcycle or cycle pulling out—so that it is rational and necessary for the motorist to take evasive action by moving his vehicle temporarily into the bus lane to avoid a worse problem such as a collision or worsened congestion. That is a judgment that a motorist has to make in a split second. It may be that, before the enforcement authorities intervene, the temporary problem that caused the motorist to move into the bus lane has cleared or is not immediately apparent to the enforcement officers who were not on the scene at the time. The motorist may then be prosecuted, but it is important that authorities dealing with such infringements are sensible about what might have happened. In the event of prosecution, there needs to be a proper procedure to allow the motorist to state his case, and for that to be taken seriously. My hon. Friend the Member for Christchurch has done us a service by drawing attention to such issues.
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The same is true of parking. On occasion, a motorist may identify a free parking space only to discover that the parking machines in the vicinity are full of coins and not operating or have broken down. Is it really the case that the motorist has to feel that he cannot park there at all, even though it is a lawful parking slot in normal circumstances, because the authorities have been unable to collect the money or maintain the machine to an appropriate standard? I would hope that a plea in mitigation would be available, so that the motorist could get off if he had tried to pay and had genuinely been unable to do so, especially in cases where he had put a note on the windscreen of the car, explaining that he had no wish to defraud or deprive the authorities of their money but that there was no one around to collect it and the machine that the authority had supplied could not take the money. I hope that such extenuating circumstances will lead to sensitive and sensible enforcement.
Under the new clause, in the event that authorities tried to play Dick Turpin with the extensive powers to charge and fine, there would be an opportunity for a Minister to issue national guidance. I have only one worry about my hon. Friends' sensible proposal. I doubt whether Ministers are on the side of motorist and would wish to use the power sensibly if local authorities saw the Bill as a way to raise money from unsuspecting motorists or those unavoidably tempted into breaking a rule or regulation. I will not hold that against my hon. Friends, however. I would like to see them return to government as soon as possible, and it would be useful if the provision were included in the Bill so that it could be used by a sensible Minister, even if we cannot persuade current Ministers that there is a problem. I sometimes read in the press that Ministers have seen the light and recognised that most of their constituents—and they themselves—are occasionally motorists, but at other times they seem to go back into the mode of thinking that all motorists are wicked and should not use their cars.
It gives me pleasure to support the new clause, and I hope that the Minister will find some words of comfort for the hon. Member for Bassetlaw, who needs a different kind of amendment to tackle the robber barons about whom he is rightly worried.
2.30 pm
Mr. Greg Knight: I hope that I am not developing early signs of schizophrenia, but I have been puzzling since our debate started about why, on the amendment paper, I am referred to as "Gregory" next to the new clauses to which I have put my name and "Greg" next to the amendments. Perhaps someone could enlighten me about that before we conclude our proceedings.
I support new clause 1. There is a need for a code of practice, compliance with which should be compulsory—it should be a mandatory code. It is needed because widely varying practices are currently applied to decriminalised parking enforcement contracts from one council to another. Existing guidance from the Department, which I understand is issued under circular 1/95, is not proving to be as helpful as many Conservative Members had hoped. The circular is largely ignored by several local authorities, and I am told that some councils are not even aware of its existence.

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In case after case, the monetary gain from parking penalties is too much of a temptation for many councils, and they prefer to maximise their revenue at the expense of fairness and justice. I was listening to a local radio station in my car as I drove south down the MI on my way to the House yesterday. I was astonished to hear someone from Leicester city council saying that the council had to increase the parking charges in the city of Leicester by far more than the rate of inflation because its revenue from the issuing of parking tickets had dropped. The radio interviewer seemed rather baffled as to why the council wished to penalise law-abiding motorists who parked in parking bays and paid their fees because the rate of revenue gained from those who ignored the law had fallen. The council has given the game away. Many local authorities introduce such measures as a purely revenue-raising exercise.
A mandatory code of practice would require local authorities to ensure that enforcement standards were uniform throughout the country. I believe that it would reduce the number of appeals made on tickets issued in borderline circumstances. As my hon. Friend the Member for Christchurch (Mr. Chope) said, the adjudication service would have clear instructions as to what was, and what was not, reasonable.
I would also hope that a code of practice would completely remove some of the dubious practices that currently exist in some parts of the country, and I wish to inform the House of several examples of such practices that have been brought to my attention since the Bill started its parliamentary progress. First, in some areas, a penalty charge notice is issued within one or two minutes of the expiry of the time purchased. Secondly, vehicles are sometimes clamped before the statutory 15 minutes has expired. I believe that 15 minutes is far too short a time anyway, because clamping adds to the delay suffered by the motorist and the inconvenience caused. It also puts a further £60 or so on top of what is already an extremely high charge.
Thirdly, vehicles are towed away from a parking bay within the first hour of overstay even though they clearly cannot be causing an obstruction because they are in a parking hay. The power to tow vehicles from parking bays should not exist unless it is clear from the effluxion of time that a vehicle has been abandoned. Fourthly, I am told that in some local authorities, authorised removal vehicles cruise around looking for offending vehicles. The Minister should condemn that practice because although it contravenes his Department's guidance, it happens on the streets of some of our cities.
Fifthly, traffic wardens do not wait to satisfy themselves of whether a vehicle is being loaded or unloaded. A case was recently brought to my attention in which a solicitor was visiting his in-laws and unloading a piece of furniture from his car. The solicitor was amazed to observe from the house window a traffic warden who approached the vehicle and started to write a ticket without delay. With the presence of mind that one would expect from a member of the legal profession, he took out a video camera and videoed the incident. When the local authority refused to withdraw the ticket, he took the matter all the way to court and won his case by producing evidence that the traffic warden had not satisfied himself that the vehicle was being unloaded.
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The sixth complaint that has been drawn to my attention is about cases in which a penalty charge notice is issued for a so-called out-of-parking-bay offence even though the vehicle extends just over the bay lines. Does the Minister approve of such behaviour and, if not, will he tell us what he intends to do to bring about an end to the practices? If new clause 1 were to become law, it would cope with all the grey areas that I mentioned.
Mr. Redwood: I agree with my right hon. Friend. Proper signing and notices are essential so that motorists know what is required of them. One wonders why the notices are inadequate. Perhaps that is deliberate—as I think he and I suspect—so that more revenue may be raised from the motorist.
We often hear that we are a tolerant society with a fair system of justice, but those practices are a blot on our otherwise well-earned reputation for fairness. They are driven by the greed of local authorities, not by justice. I frankly find them offensive because they are a means of raising money from those members of society who are in the main law-abiding, yet are identified by local authorities as a soft touch.
What makes matters worse is the fact that our fines and parking charges in general are already among the highest in the world. If my right hon. and hon. Friends will forgive me, I shall commit heresy by citing figures in euros. I think that the House will find the figures interesting. In Vienna, the maximum parking fee is (Euro)0.87 per hour. In Brussels, the maximum parking fee is (Euro)0.50 per hour, and in Barcelona. the maximum fee is (Euro)1.20 per hour. In Amsterdam, the maximum fee is (Euro)2.50 per hour, and in Paris, which is the nearest of our European partners' capital cities to this island, the maximum parking fee is (Euro)3 per hour. However, here in the UK, in London, the maximum parking fee is (Euro)8 per hour. I do not regard that as justice. The situation is not equitable or fair, and the Minister should examine it.
One can add to that the fact that most of our European Union partners impose fairly modest fines for breaches of parking regulations. Fines for parking offences ranging from (Euro)25 to (Euro)50 are the norm throughout the EU. However, in the UK, fines— perhaps I should call them stealth-tax fines—of between (Euro)100 and (Euro)130 are imposed.
Looking at these figures, the House can see how great is the injustice on the poor, long-suffering British motorist.
A report in The Times on 7 March revealed that
wardens in Scotland's two biggest cities distributed 500,000 tickets last year. Glasgow city council raised £6.6m in fines while Edinburgh collected £7.1m—a rise of 40% on the previous year.

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It went on:
"Wardens in Edinburgh, nicknamed the 'blue meanies', have issued tickets to disabled drivers, police cars, ambulances and a hearse. Drivers in Glasgow have been ticketed close to midnight and others have been hit with fines for parking late at night in council car parks."
The report also reveals that, although 500.000 tickets were issued in Glasgow and Edinburgh, the police are responsible for issuing tickets outside those cities, and they issued only 157,000 tickets. That indicates that the police are operating as we would expect in a quasi-judicial way—in issuing tickets when they feel that that is fair, yet in some, not all, decriminalised areas where wardens operate, those wardens see this as a moneymaking exercise.
The new clause is an attempt to stamp out those indefensible injustices, over which the Government continue to preside. Let the Minister accept the new clause, and if he resists it let him explain to the House how he intends to guarantee to the motoring public fairness and equity in the operation of our parking systems. The unfair brow-beating and money-grabbing persecution more suited to a banana republic than to the United Kingdom really must cease.
The Parliamentary Under-Secretary of State for Transport: I was interested in the remarks of the hon. Member for Christchurch (Mr. Chope), who repeated a phrase that he used in Committee: he said that he was involved in the fight-back campaign for middle Britain. I can tell him that if the unlikely day comes when he gets somewhere near to getting back into government, he will be doing as we are doing—fightingon behalf of the whole of Britain.
We fully intend that guidance will be issued to local authorities undertaking civil enforcement of traffic contraventions. Part 6 provides for putting civil traffic enforcement by local authorities on a consistent national basis. All authorities, whether in London or outside, will be given the same powers. It is important that authorities that exercise those powers should do so as consistently as possible across the country, and that requires nationally applicable guidance.
I am not sure that I would go as far as the right hon. Member for East Yorkshire (Mr. Knight), who I know to be a strong Europhile. I do not know whether those views are entirely shared by those around him. I do not want Euro-standards for fines or any matters to do with taxation, even though I am a luke-warm Europhile.
Mr. Knight: I was not arguing for Euro-standards; I was making the point that where we are so far out of line with the rest of the civilised world, surely something must be wrong. Our fines and parking charges are too high.
Mr. Jamieson: We are a long way out of line on road safety and on death and injury on the roads, and I would say that that is not wrong; it is right. We are right in the fines that we are imposing. It is also right that we make decisions about these matters, and I certainly do not want any Euro-standards. Perhaps the right hon.
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Member for Wokingham (Mr. Redwood) will come to the right hon. Gentleman's aid and make a strong, powerful case on behalf of Europe.
Mr. Redwood indicated dissent.
Mr. Jamieson: There we are—there is already a split on the Tory Benches. It doesn't take long, does it?
John Mann: I thank my hon. Friend for giving way on the issue of Euro-standards. As he will be aware, I have driven cars and lorries commercially into many of the cities that were mentioned, and I assure him that the information provided by the right hon. Member for East Yorkshire (Mr. Knight) is wholly inaccurate regarding a number of the capital cities that he mentioned; for example, Brussels, Vienna and Paris.
2.45 pm
Mr. Jamieson: I thank my hon. Friend for that.
The question is whether guidance needs to be put on a statutory basis, as new clause 1 seeks to provide. Sadly, we cannot accept the new clause as drafted, as it refers to the London Local Authorities and Transport for London Act 2003. The civil enforcement provisions of that Act will be repealed in due course by regulations to be made under the provisions of part 6 of this Bill. Also, I have to say that, although we know a good deal about civil enforcement of parking and bus lanes, in framing national guidance, we will in fact be learning from the practical experience gained by the pilots of enforcement of moving traffic contraventions to be undertaken in London under the powers in the 2003 Act.
I have considered the points made by my hon. Friend the Member for Bassetlaw (John Mann) in the debate and in the substantial correspondence that he sent to my Department, which I read with great care. It makes sense for local authorities to be able to contract out the day-to-day operation of their car parks where that represents best value. Where such contracts are entered into, it is of course the responsibility of the local authority to ensure that the appointed contractor acts in accordance with the authority's wishes.
The case of Bawtry council car park is, perhaps, unusual. My hon. Friend made a point about the adjudicator. In the case of that particular car park and highways authority the area does not, as yet, have decriminalised parking, which means that the adjudicator is the magistrates court. One of the things that my hon. Friend was asking for is that the parish council should have to go to the highways authority to get permission to go ahead with prosecution. The right hon. Member for Wokingham, who is not usually one for talking up extra regulation, even for local authorities, supported my hon. Friend in that. The difficulty is that we could be providing something that all parish councils in similar circumstances would have to do, putting an extra burden of bureaucracy on them because of what I consider to be the specific and particular problems of the car park in my hon. Friend's area.
I fully accept that there are difficulties in that car park; my hon. Friend articulated them with great strength and power today and in the Standing Committee. If he thinks that there are other places with similar

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problems—perhaps the right hon. Member for Wokingham, who came to his support, knows of some—I will be interested to hear about them.
John Mann: The point is that the parish council cannot go for decriminalised car park status, and if Doncaster council, as the highways authority, went for that status, the ambiguity would be even greater, because the parking adjudicator would be available for people parking in Doncaster car parks, but not those in the privatised Bawtry car park, precisely because it was privatised.
Mr. Jamieson: I do not think that that is correct. I will take some advice on that, but it is for my hon. Friend to go to the authority in Doncaster to see whether it has any interest in taking up the option of decriminalised parking. The adjudicator would then, as my hon. Friend says, be available to people in Doncaster. As I understand it, however, it is the operation of the car park, rather than the car park itself, that is privatised. My hon. Friend will accept that if we made regulation on the basis of one car park, which affected all the other parish council authorities in the country, that would be somewhat unfortunate.
I have listened to the debate with great care. Having listened to Members' oratory, I wish to sound an early conciliatory note. Whatever the defects in the drafting of the new clause, after careful consideration I have concluded that there is merit in putting civil enforcement guidance on a statutory basis. It would give the guidance greater force and make authorities more mindful of its content when carrying out enforcement activities. I therefore hope that the hon. Member for Christchurch will withdraw the new clause on the understanding that we will introduce a suitable amendment in another place, putting guidance to local authorities on civil enforcement of traffic contraventions on a statutory basis.
Mr. Chope: I am grateful for what the Minister has said. Could he be more precise about the stage at which he will table an amendment in another place?
Mr. Jamieson: I have only just been persuaded by the hon. Gentleman's arguments, but when the Bill goes to another place we will consider how to table a new clause to meet the points raised in new clause 1.
I hope that that is helpful. Notwithstanding his points about Europe, with which I did not agree, the right hon. Member for East Yorkshire expressed some genuine concerns, and we shall make sure that they are dealt with.
John Mann: I am horrified that the Minister has accepted a provision that worsens the double standards that apply to local authority car parks and privately operated local authority car parks. What advice would he give to the Driver and Vehicle Licensing Agency which, in a letter to me this morning, said that copies of penalty notices have to be provided? I won my court action against Bawtry town council because the DVLA had agreed that penalty notices were inaccurate and had
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been issued illegally. What does the Minister intend to do to ensure that equally strong guidance is issued to private operators, not least because the DVLA is key—
Madam Deputy Speaker: Order. That is a very lengthy intervention.
Mr. Jamieson: Thank you, Madam Deputy Speaker.
The guidance, in fact, will take into consideration most of my hon. Friend's points, but I will also look at the involvement of the DVLA.
Mr. Greg Knight: To hear a Minister admit that he listened to the debate and was convinced by it is very rare indeed, so I should like to place on record the fact that there is no gloating among Conservatives. Indeed, in our eyes, he has grown in stature.
Mr. Jamieson: That is extremely kind of the right hon. Gentleman. In the seven years for which I have been in government it has not been uncommon for Ministers to listen—indeed, that occasionally happened before we came to office.
I hope that my assurance has been helpful. A good case was made for the new clause, and I shall accept its substance for consideration in another place.
Mr. Chope: I am surprised but delighted by the Minister's approach. I hope one day to have a secretary who can type up my thoughts as quickly as the Minister's thoughts were typed up when, in responding to our debate, he changed his mind after he listened to our arguments. We decided, because of the strength of our arguments, to table our amendments well before the Bill's Report stage. The Minister could therefore have applied himself to the matter a little earlier, and tabled an appropriate Government amendment. However, we look forward to seeing the substance of the Government amendment in another place, and I hope that it will take into account the concerns expressed both in our debate and by parking adjudicators. Recognising that this is a victory in the motorist's fight back, I beg to ask leave to withdraw the motion.
Motion and clause, by leave, withdrawn.

New Clause 2

  PERMITS ISSUED UNDER PART 3 (FEES)
  'No fee in respect of any application for a permit or the issue of a permit under Part 3 of this Act shall be set at a level higher than that necessary to cover the administrative costs of—

  responding to permit applications;

  issuing permits; and

  maintaining a register of permits.—[Mr. Chope.]

  Brought up, and read the First time.
  Mr. Chope: I beg to move, That the clause be read a Second time.
  Madam Deputy Speaker: With this it will be convenient to discuss the following amendments: No. 10, in page 16, line 20, at end insert—
  '(2A) Permit regulations shall set out standard provisions which must be included in a permit scheme so as to ensure a reasonable level of consistency between permit schemes within the

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  authority's area, and in particular to ensure that a single electronic noticing system may be used to implement permit schemes within the authority's area."
  No. 11, in page 16, line 40, at end insert—
  '(f) for or in connection with the obtaining of permits for works carried out by the highway authority, and/or the inclusion of works carried out by the highway authority in a register of permits.
  No. 12, in page 20, line 31, at end insert—
  "(3B) A street authority may not give a direction under this section in respect of works for which a permit under part 3 of the Traffic Management Act 2004 has been issued."
  Mr. Chope: I hope that the Government will be as accommodating of new clause 2 as they were of new clause 1.
  The provision deals with a stealth tax that is estimated to cost £1.2 billion a year or £55 per household per year. It is therefore quite high up the list of stealth taxes. To put it in context, while that figure is not as high as the pension stealth tax of £5 billion or £6 billion a year, it is greater than the total yield from the new charging regime that the Government propose to impose on higher education. Our debate is therefore significant, because if the Government accepted the new clause, they would be unable to use the permit scheme in part 3 as a new stealth tax.
  One of the most frustrating aspects of the Committee stage was the lack of clarity about the Government's intentions on the use of lane rental, penalties for road works that take longer than is reasonable and the introduction of a permit scheme, perhaps along the lines of the scheme used in New York. If the Bill remains unamended, the Government will have the power to use the permit scheme as a means of imposing charges on utilities for the mere occupation of the highway, irrespective of whether the occupation is necessary. The Transport Act 2000 introduced a lane rental scheme, which was piloted in Camden and Middlesbrough. Those lane rental pilots expire at the end of March and the Government consultants, Halcrow, will report on the outcome. It is already clear from their interim report, however, that the pilots have proved to be expensive and bureaucratic, and have not resulted in a reduction in the number and incidence of roadworks undertaken by utilities. New clause 2 would prevent the Government from using the permit scheme as a revenue-raising measure on a par with lane rental.
  In Committee, the Under-Secretary of State for Transport, the hon. Member for Harrow, East (Mr. McNulty) said:
  "the Bill is not about introducing permit schemes as a revenue-raising exercise."
  He went on to say:
  "We must ensure that there is sufficient ability to charge for the permits to pay for the scheme. However, it is not meant to be, and I do not think that it will be, a revenue-raising scam".—[Official Report, Standing Committee A, 29 January 2004; 163–c.;65.]
  The hon. Gentleman went on to suggest that he was sympathetic to our aim of including in the Bill a restriction on the power of local authorities to use permit schemes as revenue-raising measures. That was the good news, but sadly the efforts of representatives from the National Joint Utilities Group, who spoke to
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  officials from the Department behind the scenes about finding a form of words acceptable to the Government were met with stony silence—indeed, were strongly rebuffed.
  Mr. Eric Forth: I am interested in my hon. Friend's analysis, but how does it accord with the view in many quarters that we should allow local authorities the maximum discretion in deciding what to do in their own area? Is there not an argument for saying that in this case, as in many others, local authorities should be allowed wide discretion in charging for permits, as they would be accountable to voters later?
  Mr. Chope: My right hon. Friend makes a case for giving local authorities a great stealth tax power but, having been the leader of a local authority, I believe that it should be the responsibility of national Government and Parliament to set the parameters of local authorities' tax and revenue-raising powers. It is a great privilege for local authorities to be able to raise taxes through, for example, the council tax. Imposing charges for car parking or occupation of the road is one thing. but a scheme for raising more than £1 billion a year from the utilities and, effectively, the public is something else—(Interruption.] My right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) thinks that that is a good idea, and I look forward to hearing his arguments later. Speaking as someone who is concerned on behalf of ordinary householders whose utility bills are already of significant size and will go up further as a result of various measures introduced by the Government, I think householders throughout the country need another £55 added to their utility bills each year like they need a hole in the head. I am in favour of flushing out the Government's attitude to this stealth tax. If it means that I go down fighting on behalf of my constituents and other householders, but get some criticism from my right hon. Friend the Member for Bromley and Chislehurst, so be it.
  3 pm
  Mr. Andrew Miller: Is there not a flaw in the hon. Gentleman's argument? He has argued before that the utilities, particularly modern utilities such as broadband, are delivered in a way that disadvantages people in rural communities. Is it not the case that rural communities would not pay the alleged tax that he has invented, and the burden would fall entirely on urban dwellers?
  Mr. Chope: I have not yet referred to any particular utilities or to broadband. The hon. Gentleman mentions the specific issue of broadband and telecoms infrastructure. As he knows, that is a sensitive issue, and some of the more remote communities may get access to broadband without the roads having to be dug up.
  Mr. Miller: So will the hon. Gentleman concede that his earlier figure of £55 per household is wrong?
  Mr. Chope: I will not concede that that is wrong. It is, inevitably, an average. The calculation is based on dividing the figure of £1.2 billion by the number of

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  households, which gives a possible cost per household of £55 per annum to introduce the scheme that the Government have in mind. The hon. Gentleman identifies a difference between rural and urban areas, which means that in some areas the figure will be less than £55 and in others it will be much more than £55.
  Mr. Redwood: My hon. Friend has put his finger on a crucial point. is this not part of a pattern? The Government came in with a utility windfall tax, went on to a pension tax, then to a telecoms tax—a swingeing £22 billion on our leading utilities at the cutting edge of the technological revolution—and now the Government are going on to another set of stealth taxes on utilities trying to improve the service to our constituents. I am entirely with my hon. Friend, and in disagreement with my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) who, on this rare occasion, has got it wrong.
  Mr. Forth: Wait and see. The House has not heard me yet.
  Mr. Chope: Indeed, I have not heard my right hon. Friend's speech. I am grateful to my right hon. Friend the Member for Wokingham (Mr. Redwood) for his support.
  Looking at the matter in context, it is clear that the biggest burden will be in the water industry, which is carrying out a major investment programme. The industry estimates that the cost of the scheme that the Government have in mind would be in the region of £300 million a year. If the Government accept the new clause, we will know that they do not have a stealth tax in mind. I recently attended a Greater London authority meeting, which was not an experience I would wish on other hon. Members. I noticed how enthusiastic the Mayor of London is about getting his hands on new revenue from the permit regime.
  I shall speak briefly about the amendments included in the group. Amendment No. 10 seeks to avoid the administrative nightmare for utility companies of myriad different permit schemes operating across England and Wales. It would integrate an electronic noticing system within any permit scheme to further reduce the administrative overheads. The amendment is in line with the stated intentions of the Minister, who said in Committee:
  "The greater the standardisation that the group can achieve, the better"—[Official Report, Standing Committee A, 29 January 2004; c. 166.]
  The amendment would not prevent account being taken of local circumstances, but would ensure that differing local circumstances were taken into account in the application of a permit scheme, rather than in the scheme itself. A permit scheme needs to be flexible enough to take account of different road types and traffic conditions. Those are the key differentiating factors between local authorities. The amendment is supported by Transport for London, which states that it would prefer a single permit system to operate in London so that information could be easily shared and analysed and administrative burdens minimised.
  Amendment No. 11 introduces uniformity by ensuring that the local traffic authority would have to abide by the same conditions as apply to utilities. If
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  permits are an effective way of meeting the overall objectives of reducing congestion caused by obstruction in the road, logic requires that highway authorities should be included. Clause 32(2)(a) states that the permit scheme may make provision as to the persons who require a permit, which does not rule out the highway authority needing a permit for its works. The amendment would make that explicit.
  Amendment No. 12 is designed to address the potential conflict between permit schemes and directions under section 56 of the New Roads and Street Works Act 1991. It is absurd to have different provisions in different Acts controlling the same set of circumstances. The amendment makes it clear that where a permit is granted, it will take precedence over section 56.
  In conclusion, the amendments are supported by the Transport Sub-Committee, which has expressed its grave scepticism about the entire permit scheme and its opposition to the lane rental scheme. It believes that the Government should develop a scheme, which we strongly support, for penalties where utilities take longer than is reasonable to carry out works on the highway. Introducing an additional stealth tax is the wrong way to proceed.
  Brian White: I have considerable sympathy with the hon. Member for Christchurch (Mr. Chope) because the amendments reflect a number of issues that I raised in Committee, especially a permit scheme. I was interested in why he mentioned a stealth tax and the figure of 55 quid. That assumes that the utilities would be subsidising local authorities, it assumes all the costs but none of the savings, and it is a worst-case scenario. To present the situation as the hon. Gentleman did exaggerates points that are validly made.
  Mr. Miller: Did my hon. Friend notice that the hon. Gentleman omitted the effect of the business rate, and told me in response to an intervention that the £22 billion income from the telecoms auction was this Government's stealth tax? As my hon. Friend knows, that was started by another Government.
  Mr. Deputy Speaker: Order. I hope that in his mind the hon. Gentleman was addressing the Chair, rather than his hon. Friend.
  Brian White: As my hon. Friend says, the 3G licence was in the Conservative party manifesto in 1997, on which the right hon. Member for Wokingham (Mr. Redwood) fought that election.
  Mr. Redwood: I was the shadow spokesman when the measure went through, and I opposed it on behalf of Her Majesty's loyal Opposition on the grounds that it would do great damage to the industry, which it did.
  Brian White: That does not answer the point that the right hon. Gentleman fought an election on that policy, which was proposed by the Government whom he supported. He has a selective memory.
  The utilities have expressed concern about the way in which local authorities will operate the permit scheme. There is perceived unfairness in the local authorities'

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  both operating and being subject to the permit scheme. I hope Ministers will discuss that with the utilities. There is also concern among utilities that additional costs will he passed to them and therefore to their customers, particularly in the telecoms industry. That industry is particularly fiercely competitive at the moment and there is not much scope for companies to absorb additional costs. In fact, most of them are fairly efficient. Telecoms works tend to be smaller in size and shorter in duration—many are completed in one day. On Second Reading, the Minister referred to the establishment of a working group to try to ensure that permit schemes take on board the needs and priorities of the economy as a whole. I urge him to consider any recommendations that come from that in relation to the operation of permit schemes.
  Most telecoms companies strive to connect customers in line with their requests. There is a danger that all schemes will be treated equally although they do not cause the same amount of damage. Some roadworks are minor and involve non-sensitive roads. Permit schemes must be flexible enough to ensure that different schemes are treated differently otherwise, people's fears about the size and cost of bureaucracy may be realised.
  In response to my amendments in Committee, the Minister gave an assurance that permit schemes will be covered by regulations. I welcome that, but urge him to undertake full consultation before implementing the regulations, because the industry fears that that will not happen.
  The hon. Member for Christchurch talks about the need for a national permit scheme, or at least one that is consistent across the country. Can the regulations be drafted from the point of view of someone who has to fill in the forms? Many utilities fear that they will have to fill in forms for many different types of scheme. It is important to have not only local variations to adapt to local circumstances, but consistency nationally so that national companies are not faced with myriad different approaches.
  The new clause is unnecessary. This is not a stealth tax. There are legitimate concerns, but the hon. Member for Christchurch overstated them and they should be dealt with flexibly in regulations.
  Mr. Redwood: I share the worry felt by my hon. Friend the Member for Christchurch about part 3, which gives wide-ranging powers to local authorities that wish to take advantage of them to set up permit schemes. In particular, clause 36(5) gives local authorities substantial powers to set
  the amount or maximum amount of any fee,
  to decide on
  cases in which fees are not to be payable or could be repaid
  and on
  cases in which fees may be discounted.
  They are able to settle
  the time and manner of making payment of fees
  and
  the application of sums paid by way of fees.
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  In my experience, several local authorities—they are usually under Labour or Liberal Democrat control—are constantly on the lookout for new sources of revenue. As they have many ways of spending, or often wasting, the money, they wish to raise more. I fear that those local authorities would see public utility businesses as a soft target. They would, after all, be following the example of Her Majesty's Government, who saw them as a soft target in the run-up to the 1997 election, confirmed it in the Budget that introduced the utilities windfall tax, and continued it with their whopping auction tax on telecoms. Through this measure, the Government are effectively encouraging local authorities to see that device as a way of raising additional money.
  My hon. Friend the Member for Christchurch says that there is nothing wrong with a permit scheme, despite the bureaucracy and administrative effort involved, if it achieves the ostensible objective of the provisions. Let us remind ourselves of that objective—it is to say to utility companies that there is a cost to the rest of us when they dig up the street or road, and that it would be a good idea if they did it in a s timely a way as possible, restricted the amount of road that they damaged or dug up at any given time to allow traffic to flow on the remaining part of the carriageway, rather than closing a large amount or all of it, and entered and exited the streetworks at times of day or year that do the least damage to traffic flows in the area concerned.
  It is a matter of great concern to many of us that some local highways authorities and utility companies decide to embark on streetworks at the beginning of a busy term just in time for the first day back at school, which always increases traffic dramatically. We often see a cessation or reduction in roadworks during less busy times of year--in the summer holidays, for example, when traffic flows are much less because there is no school run and many more people are away on holiday. We often note that roadworks do not continue over the weekend, when traffic may be rather less. and that there is considerable blockage of the road on the Monday morning or Friday evening peak when traffic congestion is at its worst.
  3.15 pm
  Therefore, as someone who does not much like administrative intervention and regulation, I can live with the idea that there should be a permit scheme to regulate roadworks in the interests of making better use of the highway and increasing the capacity of the road system, particularly at busy times of day in busy areas. That may be a necessary evil. What worries me, however, is that without the amendment wisely tabled by my hon. Friend the Member for Christchurch, part 3 does not make it clear enough that its only intention is to discipline utilities and to encourage limited entry to the highway and entry only at the least difficult times of day or year. The Bill contains no statement that would prevent a local authority from seeing it as offering up a soft target for raising money.
  We argued long and hard in Committee about why the proposals to limit or regulate access to the highway for roadworks do not apply to the public sector, because observation tells us that more often than not it is the highways authority, not the utilities, that does that work. I hope that the Minister will say more about that

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  at the appropriate moment. As the Bill concentrates on the utility companies, it is most important that Ministers understand the strength of feeling on the part of people of all parties and of no party that there are far too many roadworks, that they are badly organised, and that they often run into periods of time or periods of the day when it would be far better if the highway were open to traffic.
  Brian White: The right hon. Gentleman is giving a generalised picture that does not reflect what really goes on. In the case of the telecoms companies, for example, most of the cabling has already been done, so most of the works that remain to be done are minor.
  Mr. Redwood: I accept that that means that such work may be much easier to regulate or does not need regulation at all. I would still hope, however, that the highways authority would take a view and suggest to the telecoms utility concerned that it would be good idea to do the work on a dull Sunday rather than a busy Monday. That would be a necessary improvement on the current regime.
  I hope that the basis of any guidelines issued under part 3 will be to make more intelligent use of what highway we have and to limit the amount of restrictions upon it. It would be sensible, for example, for highways authorities to point out to water, gas, electricity or telecoms utilities that the repair or replacement work that they are doing can often be done in sections and that it would be possible, at half-past 4 or 5 o'clock at night, when the employees are thinking of going home, to close off the hole in the road again with a temporary or permanent closure of filling or tarmac so that the road can be reopened for use when they are not working on it. It would[ be possible to do something similar to ensure that the road is open for busy morning peaks and that the roadworks can be done thereafter.
  Those are the sorts of measures for which the highways authorities should use their permit powers. If the amendment is rejected, however, greedy councils may decide that this is a marvellous opportunity to charge utilities a lot of money for engaging in streetworks and opening up the road. They may not be interested in the overall intention of speeding up the works or having them done at sensible times of the day or year, but may see a lot of advantage in allowing the utility to run on with the works, maximising the inconvenience to motorists, because they will generate more cash from the permit scheme.
  I strongly recommend the new clause to the House. Without it, we will end up with another utility stealth tax that will undoubtedly have to be passed on to all our constituents in the way that my hon. Friend the Member for Christchurch describes.
  Mr. Forth: I wonder whether the new clause moved by my hon. Friend the Member for Christchurch (Mr. Chope) is either otiose or entirely at odds with what I thought was our party's policy. I am rather puzzled, following the points that my right hon. Friend the Member for Wokingham (Mr. Redwood) made. He reminded the House that clause 36(5) says:
  Permit regulations may make provision for or in connection with requiring the payment of a fee in respect of an application for a permit or the issue of a permit, including provision as to … the amount or maximum amount of any fee.
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  My reading of that is that it has the potential to cover the matter that has caused such concern to be expressed by my hon. Friend the Member for Christchurch and my right hon. Friend the Member for Wokingham. I wonder how much added value there is in the words proposed in the new clause. On the face of it, the Bill as drafted seems to make more than adequate provision.
  May I say in passing that I am uncomfortable with the immense degree of bureaucracy involved in this whole exercise? For example, clause 33—which is in part 3, the subject of new clause 2—says:
  A local highway authority, or two or more such authorities acting together, may prepare and submit to the appropriate national authority a permit scheme.
  That takes us deep into the jungle of bureaucracy—up to our armpits or beyond. We have in that provision the lethal combination of local authorities on the one hand and national bureaucracies on the other. Yet, although I am sorry to say this, my hon. Friend the Member for Christchurch seems to be adding to that bureaucracy in a most regrettable way.
  I may be labouring under a misapprehension, and I am sure that one of my hon. Friends will put me right if I am, but I thought that the whole thrust of my party's policy was local autonomy and local decision making. I have heard many of my right hon. and hon. Friends speak at great length, and with passion, about the need to give local bodies—be they school boards, local authorities or anything else—the maximum possible degree of discretion in making decisions for which they are accountable to their electorate. However, I now find to my astonishment that my hon. Friend the Member for Christchurch has come along with new clause 2, which apparently seeks to overturn that whole philosophy, because it says:
  No fee in respect of any application ... shall be set at a level higher than that necessary to cover the administrative costs.
  Mr. Redwood: My right hon. Friend protests too much. The purpose of new clause 2 is to signal clearly that the measure is not a tax. Local authorities have other taxes that they impose, but this should be simply an administrative charge that reflects the cost of giving the public something that many of them want: greater access to their roads.
  Mr. Forth: That might be my right hon. Friend's view, but—
  Mr. Redwood Mr. Redwood: It is.
  Mr. Forth: My view, however—as I am the one speaking, I think that my view has primacy at the moment—is that local authorities should be given the scope and freedom to charge a fee. even if we call that a tax, at their discretion, for which they are accountable to their voters. That is the burden of my argument. I thought, in the most peremptory way, that that was the thrust of our policy, but along comes my hon. Friend the Member for Christchurch and tramples all over that. He is saying, in a heavy-handed way, that he has decided that were new clause 2 to be accepted, local authorities

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  should not have that discretion. However, 1 bet that when my hon. Friend was the eminent, successful leader of Wandsworth borough council, he would have argued for such a stance and said, "Knowing the local conditions in Wandsworth, 1, accountable as I am to my electorate, want us to have the freedom to impose such charges locally as I think are necessary."
  Mr. Miller: May I ask the right hon. Gentleman if we are hearing a Tory split, or a Tory filibuster?
  Mr. Forth: No, we are hearing a mature Tory debate of the kind that—
  Mr. Miller: It is a split, then.
  Mr. Forth: I do not want to be drawn into such an argument, but if the hon. Gentleman is saying that in the Labour party, new or old, a debate is now called a split, that tells us quite a lot about his party's mentality. In the new, thrusting, dynamic Conservative party we welcome debate because we are confident of our philosophy, particularly our philosophy on local government autonomy, if I may say so to my hon. Friend the Member for Christchurch.
  Mr. Chope: Will my right hon. Friend accept that the whole ethos of Wandsworth borough council, when I was privileged to be its leader, was to keep taxes down? We wanted to have low tax rather than to introduce new taxes.
  Mr. Forth: Yes, indeed. That was my hon. Friend's decision, and the people of Wandsworth rewarded him with a continuity of power unequalled in modern times. I am grateful to him for making that point. He made that decision and was rewarded by his electorate for it. Surely he would not now want to deny elected representatives in other local authorities the power to make different decisions for their areas. They might decide in this case, for their own reasons, that higher fees would be appropriate to their circumstances and conditions. That is why I am at a loss to understand why my hon. Friend is trying to persuade the House that somehow, in a Bill—
  Brian White: Does the right hon. Gentleman accept that the utilities and other companies that will have to pay the costs have expressed concern about the impact that those costs will have on them? That is not the same as the argument that he is making.
  Mr. Forth: I shall carry the argument some way to make my point, but if a local authority were to set fees at a prohibitive level, the utilities might not undertake the repairs and improvements that they wanted to and the local populace would suffer as a result. It would then be for the local voters to make their decision, on the basis that the exorbitant fees being charged by their elected representatives were having a counter-productive effect on their lifestyle. For example. knowing the hon. Gentleman's expertise and interest in such esoteric
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  matters as broadband, I suspect that he thinks that every home should be served by the ghastly internet, and that the horrible material on it should be accessed by every household, perhaps regardless of the cost. I would take a different view, and suggest that if his local authority were wise enough to charge a penal fee to discourage the connection of the ghastly broadband and other internet services, his voters would be very grateful to him and to the local authority.
  Mr. Chope Mr. Chope rose—
  Mr. Forth: But who am Ito make such a judgment? I know not about such matters, and they are not for me or, may I say, even for my hon. Friend the Member for Christchurch to comment on. He looks pregnant, so I shall give way to him.
  Mr. Chope: I hope that my right hon. Friend will not allow his prejudice against broadband to disguise the fact that there are statutory duties relating to the safety of gas mains and the provision of water, which local authorities need to take into account. If they impose substantial extra taxes on the provision and maintenance of those key facilities, the undertakers will not be able to avoid paying those taxes.
  Mr. Forth: And indeed, to follow that point, the undertakers will not be able to avoid increasing their charges to their consumers, who will then be able to make a market judgment. What puzzles me, coming from my hon. Friend the Member for Christchurch and my right hon. Friend the Member for Wokingham, of all people, is that that they seem to be shrinking from allowing a market judgment. In the end, two mechanisms are in play on this point: the political, electoral mechanism of local authorities and the market mechanism between the utilities and their consumers, who happen in this case to be coincidental with the voters. I should have thought that that would appeal to my hon. Friend the Member for Christchurch, and I can see that he is thinking about it, which encourages me to hope that he might reconsider his position. In the end, however, I need to hear much more from him, and I hope that when he winds up this little debate, he will give further arguments to explain why he seems so wedded to a degree of central control and fiat that is completely at odds with his distinguished political history and his political philosophy. That is my problem with new clause 2.
  3.30 pm
  To return to where I came in, were my right hon. and hon. Friends to want to go down this route in any case, my reading of the original wording of the Bill is that it probably provides sufficient powers in the key phrase
  the amount or maximum amount of any fee,
  although I accept that that implies a degree of centrality, central control and omniscience—not to say omnipotence—that I find distressing. However, if my right hon. and hon. Friends want the words, they are there in the Bill already, and I hope that they will reconsider the position that they have taken in new clause 2 and seek leave to withdraw it.

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  I am equally horrified by amendment No. 10, because here we are introduced to the phrase
  standard provisions which must be included,
  which strikes me as amazingly prescriptive, and to the provision
  to ensure that a single electronic noticing system may be used.
  Mr. Redwood: If my right hon. Friend reads the amendment clearly, he will find that it includes the words
  within the authority's area.
  so his argument about local autonomy is quite irrelevant. In this amendment, my hon. Friend the Member for Christchurch is preserving the right of the authority to make a recommendation, but saying that it should be consistent throughout the authority area.
  Mr. Forth: Again, that should be a matter for the local authority itself. Why do we need a form of words to be put on the face of the Bill to tell a local authority to do something that it should be perfectly capable of deciding for itself? I do not think that this is a particularly circular argument, or even, dare I say it, a repetitive one, as I have now moved on to amendment No. 10 as opposed to new clause 2. Surely the local authority should be allowed to make its own decision about whether standard provisions should be included, even within its area. It is just conceivable that, if a local authority covered a densely populated urban or suburban area as well as an element of rural hinterland, it might be appropriate to have different provisions for different parts of the area.
  Who would feel it incumbent on themselves to come along and put in cold print on the face of a statute these prescriptive requirements that intrude on the decision making of an elected and accountable local authority? A philosophical conflict is built in to what my right hon. and hon. Friends want to say about local authorities in the overall sense—with which I thoroughly agree, and which I applaud and the thrust of what they are saying in new clause 2 and amendment No. 10. All in all, I am a bit unhappy about this, and I am very unhappy to find myself at odds with my right hon. and hon. Friends. I hope that, after the Minister has attempted to persuade the House of his position, my hon. Friend the Member for Christchurch will take the opportunity to reconsider what he has brought to the House, to think about the overall context in which he is offering it to us, and to avoid any suggestion that this might be a blot on his otherwise immaculate reputation.
  Mr. McNulty: Perhaps I can steer a path between the extremes expressed by the right hon. Member for Wokingham (Mr. Redwood) and the hon. Member for Christchurch (Mr. Chope), and the eminently sensible contribution from the right hon. Member for Bromley and Chislehurst (Mr. Forth). That is not an unusual thing to say, especially for those of us who spend our time haunting this place on Fridays. The right hon. Member for Bromley and Chislehurst seems to save up his sensible suggestions for Fridays, but today he is clearly having a good day on a Tuesday, for which I am enormously grateful. He is right to suggest that these proposals are otiose, but I must provide a sting in the tail to his argument. If he is putting forward the broadly
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  social libertarian local autonomy argument, I must part company from him, albeit gently. I agree with the thrust of what he has said, but his suggestions must be implemented within a framework of regulation and guidance.
  The new clause is otiose, as the right hon. Member for Bromley and Chislehurst suggests, and it tramples over local autonomy. I would also part company with him over his description of today's Conservatives as confident, bright young things compared with what they were in the past. We have to part company at some point.
  The right hon. Member for Wokingham gave the game away when he suggested that he wanted to send a signal that this scheme was not about stealth taxes or revenue raising, and that it was merely seeking to cover the cost of administration, as I suggested in Committee. With the greatest of respect, legislation is not the place for sending signals. The Bill should do what it purports to do and no more. The right hon. Gentleman can send signals in a little column in The Spectator or the Wokingham Gazette or Bugle. but not in the Bill. That would be as inappropriate as the—what is the polite word?—rantings of the hon. Member for Christchurch about the figure of £55 per household. Just because something is repeated often enough, or appears often enough in The Mail or The Express—
  Mr. Chope: And The Sun.
  Mr. McNulty: The Mirror or The Sun, whatever you like—anything at the murkier end of what purports to be the media in this country. Just because such things appear often enough, it does not mean that they are true.
  Mr. Forth: On that very point, does the Minister recall "tough on crime, tough on the causes of crime"? Does not that belie what he has just said?
  Mr. McNulty: I do not think that we put a price on that in quite the same way as the hon. Member for Christchurch did when he suggested that the measures would cost £55 per household. So, the right hon. Member for Bromley and Chislehurst and I have parted company again, which disappoints me as we usually get along so splendidly.
  Many of the points made by Conservative Members fall into the trap of seeing the amendment, and all the clauses to which it refers, in total isolation from the rest of the Bill. They included the suggestion that the proposal is a devious scheme to get more money for local authorities, of whatever persuasion. When we consider the measures that the Conservatives constantly refer to in their fight-back for the drivers of middle Britain, and when we consider in detail the implementation of these schemes, there is not a whole lot of difference between the political parties in terms of what they do out there in the big wide world. There is no difference at all, save for the propensity for casualties in their areas.
  The right hon. Member for Wokingham suggested that local authorities up and down the country would deliberately carry on street works for as long as possible just to extract as much money as possible from the contractors. That is in stark contrast to the provisions of

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  clauses 16 and 17, and to all that we have said about network management duty. If an authority tried to utilise a permit scheme, suitably applied for and allowed, simply to clog up the streets--which by definition it would—simply to secure a revenue stream, it would not work because of the network management duty.
  Mr. Redwood: Will the hon. Gentleman firm up that promise? Is he saying that Ministers will have to ensure that the local authorities insist on speedy street works and will impose only administrative charges on people and not unrealistically high fines?
  Mr. McNulty: I would like to go all the way with the right hon. Gentleman in that regard, but I cannot because that issue is outwith the full comprehensive nature of the Bill. I cannot say yes to that question in isolation from the whole range of other elements of the network management duty that we went through in detail in Committee. It was clear from our discussions and from what will be in the guidance that that duty is not simply about the flow of traffic or the speed of that flow. It is not just about the absence of congestion; there is a whole range of things involved, as we explored in Committee. I agree with the right hon. Member for Bromley and Chislehurst that the new clause is otiose, for some of the reasons that he has given, and others.
  New clause 2 would mean that a fee for any application for a permit or the issue of a permit could not be set at a level higher than the administrative costs to the permit authority of responding to a permit application, issuing the permit and maintaining a register of permits. I said clearly in Committee, and I repeat that permit schemes are not designed as means of raising extra revenue for local authorities. They are intended as a way of enabling all potentially disruptive activities in the street—be they utility works, local authorities' own works, the placing of skips or whatever—to be managed in an integrated and coordinated way.
  Crucially, as my hon. Friend the Member for Milton Keynes, North-East (Brian White) suggested, we have set up a working group on which all those parties sit—the utilities, local authorities and others—and charged them with considering the details of how permit schemes might work and making recommendations to the Government. That will enable us to provide in regulations and guidance that very framework within which—here I come back onside with the right hon. Member for Bromley and Chislehurst—those decisions can be made at local level to determine whether those involved want to pursue a permit scheme or otherwise.
  I have to say again that the hon. Member for Christchurch goes on and on as though these are schemes—not only those involving permits, but others—that we are about to impose directly by compulsion on each and every highway authority in the land. We are not doing that in any way, shape or form, but we want to work with the parties on which these proposals will have the most direct impact. That will enable us to draw up regulations setting out the standard arrangements applying to the schemes, as well as guidance for those operating schemes and those who
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  would need to apply for permits. By pure coincidence, the first meeting of that working group is being held today. just around the corner.
  Among other things, the group will look at exactly what activities would require permits and what level fees should be set at. In considering fee levels, it will look not only at the costs of operating schemes, but, entirely appropriately, at whether it would be sensible to set different fees according to differing circumstances. That involves the flexible standardisation that the right hon. Member for Bromley and Chislehurst suggested.
  It is appropriate to have a framework, clearly established, within which these decisions can be made, but the whole array of ideas on how to go forward with a permit scheme should be left to the local authority. For instance, should all activities attract the same fee or should the fees be varied according to when, where and how they are carried out? Those involved will also look at how, if at all, permit schemes would fit in with existing arrangements such as that for charging utilities whose works overrun an agreed deadline. We want to give the group the flexibility to look at all those relevant issues.
  In the light of the group's work, but above and beyond the working party, we will hold, later in the year, a widespread public consultation on draft regulations before those are brought to Parliament. As the right hon. Member for Bromley and Chislehurst suggests, new clause 2 is otiose, but I am a fair man. Broadly, we still have consensus in most of the House, although there is clearly disagreement and disarray in some parts. Having made those comments, I will take this away and consider what the hon. Member for Christchurch has said on the issue so that at a later stage in the Bill's passage through Parliament—in another place—we can perhaps provide more information on the Government's intentions.
  I say that deliberately, because when the Bill reaches the end of the legislative process, I want it and the subsequent guidance and regulations to be fully informed by the working group and the involvement of local authorities, utilities and other operators. That will enable us to sign off those regulations and the guidance with as much agreement as we can—in some cases, people subsequently decide that there are all sorts of difficulties with such regulation and guidance—as early as we can. Then we can leave it, within the framework of regulations and guidance, to the local authorities to determine whether they want to pursue a scheme. We will have a look at what the hon. Member for Christchurch has said, by all means, but first we should let the working group have a look at the thing.
  Amendment No. 10 would appear to require that regulations made under clause 36 must ensure reasonable consistency between permit schemes. The hon. Gentleman is entirely right: I said in Committee that that would be of use—certainly within authorities, but between authorities as well—if there were some commonalities. I do not want to put too many consensual words in the mouth of the right hon. Member for Bromley and Chislehurst, but, as he suggests, much that will be needed in terms of standardisation could be dealt with in regulations.
  The regulations would have to set out certain standard provisions that were common to all permit schemes, especially in relation to electronic noticing

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  systems. I agree with the hon. Member for Christchurch that it is desirable that there should be some standardisation—I have already alluded to that—but it cannot be sensible to have dozens of entirely different schemes operating in different parts of the country. Many utilities, although not all by any means, work nationally and some standardisation is appropriate, but 1 do not believe that we need such prescription in the Bill, as this issue can safely be dealt with through regulations.
  The working group, which we have set up to consider the details of permit regulations and the accompanying guidance, has been asked specifically to consider the issue of standardisation. I suspect that there will be some merit in going down that road. The group will make recommendations to us later in the summer on that and other matters, after which we will again go out to wide public consultation on the way forward.
  3.45 pm
  Amendment No. 11 is, I understand, intended to enable permit regulations to deal with highway authorities having to obtain permits for their own works and to record those on a permit register. Again, the amendment is unnecessary. The interpretation provision in clause 38(1) already makes it clear that the scope of "works" means that permit schemes can include works carried out under the Highways Act 1980. That covers a wide range of works carried out by highway authorities, including road maintenance works, construction of bridges and introduction of traffic-calming measures.
  The regulation-making powers can enable those works to be subject to a permit scheme anyway, taking into account the unavoidably different considerations that apply in regulating the activities of public authorities and private companies.
  We have asked the working group looking at permit regulations and guidance to consider how the works carried out by highway authorities can be incorporated within the scope of permit schemes. The aim behind permit schemes is to improve the management of all works in the street, including highway authorities' own works.
  Amendment No. 12 would have such effect that a street authority could not give an undertaker a direction relating to the timing of one of its street works where a permit had already been issued for that works. Clause 36(8) provides that regulations made by the appropriate national authority may set out provisions that modify or disapply primary and subordinate legislation. Depending on the exact structure of permit schemes decided on in the light of consultation and the work of the working group, I would expect it to be necessary for the regulations to set aside certain sections of the New Roads and Street Works Act 1991, which set down how, where and when works can be carried out. That is needed to ensure, as the hon. Member for Christchurch suggested, that we do not duplicate controls in certain areas.
  We have asked the working group to consider which existing legislation should be dealt with in that way. The power to make directions under section 56 of that Act may be one that we would want to set aside in cases where a permit has been issued. Again, that is a matter
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  for the working group to consider rather than for the Bill prescribe. The scope to alter provisions is appropriate and already in place.
  In view of my comments and the excellent contribution, by and large, from the right hon. Member for Bromley and Chislehurst, I am sure that Conservative Members feel able with confidence to withdraw the proposed new clause. As we suggested in Committee, the working groups that are bringing together local authorities, operators, utilities and other interests should put the real framework in place, so that we can take matters forward. 1 seriously ask the hon. Member for Christchurch to withdraw the new clause so that we maintain the consensus—shaky though it may now appear—that has driven us thus far on Report.
  Mr. Chope: We have had an excellent debate and, as with that on new clause 1, it was all the better for the fact that the Liberal Democrats did not participate.
  The debate centred largely on intellectual and philosophical purity. My right hon. Friend the Member for Wokingham (Mr. Redwood) and I are on one side of the argument; my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) is on the other. My right hon. Friend the Member for Bromley and Chislehurst identified a paternalistic streak in me but in the past, a paternalistic streak was found in him—when my right hon. Friend was forced, probably against his intellectual judgment, to regulate activity centres following the Lyme bay tragedy, in direct response to a private Member's Bill presented by the hon. Member for Plymouth, Devonport (Mr. Jamieson). Neither my right hon. Friend nor I can say, much as we might wish, that we are absolutely consistent in our intellectual purity.
  Mr. Forth: Surely my hon. Friend accepts that I was a Minister then. He is only in the Opposition now.
  Mr. Chope: Is my right hon. Friend saying that he was a pressed man, whereas I am volunteering?
  Mr. Forth: Something like that.
  Mr. Chope: If that is the best mitigation that my right hon. Friend can put forward, I leave it to others to judge.
  I am disappointed that my right hon. Friend did not highlight that the House is being bypassed by the vast range of regulation-making powers in the Bill--particularly in that part to which new clause 2 relates. Only a few days ago, a leading article in the Financial Times stated that regulation is the new clause IV. The Government are using regulation instead of nationalisation to achieve their objectives. The Bill contains an enormous number of regulation-making powers over which the House will have little control.
  The issue is whether one believes in low taxes, be they transparent or imposed by stealth—though we are against stealth taxes. We want low taxation. We want to protect householders from the £55 per annum burden represented by part 3. The figures have not been dreamt up by me but are the result of careful analysis by the National Joint Utilities Group.

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  When we put the new clause to the vote, as we intend, those who support it will be voting on behalf of hard-pressed householders by saying, "We do not think that you should be burdened with an extra £55 a year on your utility bills." Those right hon. and hon. Members who enter the No Lobby will be saying that they are indifferent to those householders' plight.
  Question put, That the clause be read a Second time:—
  The House divided: Ayes 175, Noes 285.

  Division No. 90]

  [3:51 pm

  AYES

  Allan, Richard

  George, Andrew (St. Ives)

  Amess, David

  Gibb, Nick (Bognor Regis)

  Ancram, rh Michael

  Gidley, Sandra

  Atkinson, Peter (Hexham)

  Gillan, Mrs Cheryl

  Bacon, Richard

  Goodman, Paul

  Baker, Norman

  Gray, James (N Wilts)

  Baldry, Tony

  Grayling, Chris

  Barker, Gregory

  Green, Damian (Ashford)

  Baron, John (Billericay)

  Green, Matthew (Ludlow)

  Barrett, John

  Grieve, Dominic

  Bellingham, Henry

  Gummer, rh John

  Beresford, Sir Paul

  Hague, rh William

  Blunt, Crispin

  Hammond, Philip

  Boswell, Tim

  Hancock, Mike

  Bottomley, Peter (Worthing W)

  Harris, Dr. Evan (Oxford W &
  Abingdon)

  Brady, Graham

  Brake, Tom (Carshalton)

  Harvey, Nick

  Brazier, Julian

  Hawkins, Nick

  Breed, Colin

  Hayes, John (S Holland)

  Brooke, Mrs Annette L

  Heald, Oliver

  Browning, Mrs Angela

  Heath, David

  Bruce, Malcolm

  Heathcoat-Amory, rh David

  Burns, Simon

  Hendry, Charles

  Burstow, Paul

  Hermon, Lady

  Burt, Alistair

  Hoban, Mark (Fareham)

  Butterfill, Sir John

  Holmes, Paul

  Cameron, David

  Horam, John (Orpington)

  Campbell, rh Sir Menzies (NE Fite)

  Howard, rh Michael

  Howarth, Gerald (Aldershot)

  Cash, William

  Jack, th Michael

  Chapman, Sir Sydney (Chipping Barnet)

  Jackson, Robert (Wantage)

  Jenkin, Bernard

  Chidgey, David

  Johnson, Boris (Henley)

  Chope, Christopher

  Keetch, Paul

  Clappison. James

  Kenneth, rh Charles (Ross Skye &Inverness)

  Clarke, rh Kenneth (Rushcliffe)

  Collins, Tim

  Conway, Derek

  Key, Robert (Salisbury)

  Cotter, Brian

  Kirkbride, Miss Julie

  Cran, James (Beverley)

  Kirkwood, Sir Archy

  Curry, rh David

  Knight, rh Greg (E Yorkshire)

  Davey, Edward (Kingston)

  Laing, Mrs Eleanor

  Davies, Quentin (Grantham & Stamford)

  Lait, Mrs Jacqui

  Lamb, Norman

  Davis, rh David (Haltemprice & Howden)

  Lansley, Andrew

  Laws, David (Yeovil)

  Doughty, Sue

  Leigh, Edward

  Duncan Smith, rh lain

  Letwin, rh Oliver

  Fabricant, Michael

  Lewis, Dr. Julian (New Forest E)

  Fallon, Michael

  Liddell-Grainger, Ian

  Field, Mark (Cities of London & Westminster)

  Lidington, David

  Llwyd, Elfyn

  Flight, Howard

  Loughton, Tim

  Flook, Adrian

  Luff, Peter (M-Worcs)

  Foster, Don (Bath)

  McIntosh, Miss Anne

  Fox, Dr. Liam

  Mackay, rh Andrew

  Francois, Mark

  Maclean, rh David

  Gale, Roger (N Thanet)

  McLoughlin, Patrick

  Gamier, Edward

  Maples, John

  212

  Marsden, Paul (Shrewsbury & Atcham)

  Spicer, Sir Michael

  Spink, Bob (Castle Point)

  May, Mrs Theresa

  Stanley, rh Sir John

  Mercer, Patrick

  Steen, Anthony

  Mitchell, Andrew (Sutton Coldfield)

  Streeter, Gary

  Stunell, Andrew

  Moore, Michael

  Swayne, Desmond

  Moss, Malcolm

  Swire, Hugo (E Devon)

  Murrison, Dr. Andrew

  Syms, Robert

  Oaten, Mark (Winchester)

  Tapsell, Sir Peter

  O'Brien, Stephen (Eddisbury)

  Taylor, John (Solihull)

  Opik, Lembit

  Taylor, Matthew (Truro)

  Osborne, George (Tatton)

  Thurso, John

  Ottaway, Richard

  Tonge, Dr. Jenny

  Page, Richard

  Trend, Michael

  Paterson, Owen

  Tyler, Paul (N Cornwall)

  Pickles, Eric

  Tyrie, Andrew

  Price, Adam (E Carmarthen & Dinefwr)

  Viggers, Peter

  Walter, Robert

  Prisk, Mark (Hertford)

  Waterson, Nigel

  Pugh, Dr. John

  Watkinson, Angela

  Randall, John

  Webb, Steve (Northavon)

  Redwood, rh John

  Whittingdale, John

  Reid, Alan (Argyll & Bute)

  Widdecombe, rh Miss Ann

  Rendel, David

  Wiggin, Bill

  Robertson, Hugh (Faversham & M-Kent)

  Willis, Phil

  Wilshire, David

  Roe, Mrs Marion

  Winterton, Ann (Congleton)

  Rosindell, Andrew

  Winterton, Sir Nicholas (Macclesfield)

  Russell, Bob (Colchester)

  Sanders, Adrian

  Yeo, Tim (S Suffolk)

  Selous, Andrew

  Young, rh Sir George

  Shephard, rh Mrs Gillian

  Younger-Ross, Richard

  Shepherd, Richard

  Simpson, Keith (M-Norfolk)

  Tellers for the Ayes:

  Soames, Nicholas

  Mr. David Ruffley and

  Spelman, Mrs Caroline

  Mr. Geoffrey Clifton-Brown

  NOES

  Ainsworth, Bob (Cov'try NE)

  Caton, Martin

  Alexander, Douglas

  Cawsey, Ian (Brigg)

  Allen, Graham

  Chapman, Ben (Wirral S)

  Anderson, rh Donald (Swansea E)

  Clark, Mrs Helen (Peterborough)

  Armstrong, rh Ms Hilary

  Clark, Dr. Lynda (Edinburgh Pentlands)

  Atherton, Ms Candy

  Atkins, Charlotte

  Clark, Paul (Gillingham)

  Austin, John

  Clarke, rh Tom (Coatbridge & Chryston)

  Bailey, Adrian

  Baird, Vera

  Clelland, David

  Banks, Tony

  Coaker, Vernon

  Barnes, Harry

  Coffey, Ms Ann

  Battle, John

  Coleman, lain

  Bayley, Hugh

  Colman, Tony

  Beckett, rh Margaret

  Connarty, Michael

  Bell, Sir Stuart

  Cook, Frank (Stockton N)

  Bennett, Andrew

  Cook, rh Robin (Livingston)

  Best, Harold

  Cooper, Yvette

  Blackman. Liz

  Corbyn, Jeremy

  Blears, Ms Hazel

  Corston, Jean

  Blizzard, Bob

  Cousins, Jim

  Blunkett, rh David

  Cox, Tom (Tooting)

  Borrow, David

  Cranston, Ross

  Bradley, rh Keith (Withington)

  Crausby, David

  Bradley, Peter (The Wrekin)

  Cryer, John (Hornchurch)

  Bradshaw, Ben

  Cunningham, Jim (Coventry S)

  Brennan, Kevin

  Cunningham, Tony (Workington)

  Brown, Russell (Dumfries)

  Curtis-Thomas, Mrs Claire

  Browne, Desmond

  Dalyell, Tam

  Buck, Ms Karen

  Davey, Valerie (Bristol W)

  Burnham, Andy

  David, Wayne

  Byers, rh Stephen

  Davidson, Ian

  Cairns, David

  Davies, rh Denzil (Llanelli)

  Campbell, Alan (Tynemouth)

  Davies, Geraint (Croydon C)

  Campbell, Mrs Anne (C'bridge)

  Dawson, Hilton

  Campbell, Ronnie (Blyth V)

  Dean, Mrs Janet

  Caplin, Ivor

  Denham, rh John

  213

  Dhanda, Parmjit

  Kelly, Ruth (Bolton W)

  Dismore, Andrew

  Khabra, Piara S.

  Dobbin, Jim (Heywood)

  Kidney, David

  Dobson, rh Frank

  Kilfoyle, Peter

  Donohoe, Brian H.

  King, Ms Oona (Bethnal Green & Bow)

  Doran, Frank

  Dowd, Jim (Lewisham W)

  Knight Jim (S Dorset)

  Drew, David (Stroud)

  Kumar, Dr. Ashok

  Dunwoody, Mrs Gwyneth

  Ladyman, Dr. Stephen

  Eagle, Angela (Wallasey)

  Lammy, David

  Eagle, Maria (L pool Garston)

  Lawrence, Mrs Jackie

  Edwards, Huw

  Laxton, Bob (Derby N)

  Ellman, Mrs Louise

  Lazarowicz, Mark

  Etherington, Bill

  Lepper, David

  Farrelly, Paul

  Lewis, Terry (Worsley)

  Field, rh Frank (Birkenhead)

  Liddell, rh Mrs Helen

  Fisher, Mark

  Linton, Martin

  Fitzpatrick, Jim

  Love, Andrew

  Fitzsimons, Mrs Lorna

  Lucas, Ian (Wrexham)

  Flint, Caroline

  McAvoy, Thomas

  Follett, Barbara

  McCabe, Stephen

  Foster, Michael (Worcester)

  McCafferty, Chris

  Foster, Michael Jabez (Hastings &Rye)

  McDonagh, Siobhain

  MacDonald, Calum

  Foulkes, rh George

  McDonnell, John

  Francis, Dr. Hywel

  McFall, John

  Gardiner, Barry

  McGuire, Mrs Anne

  George, rh Bruce (Walsall S)

  Mclsaac, Shona

  Gerrard, Neil

  Mackinlay, Andrew

  Gibson, Dr. Ian

  McNulty, Tony

  Gilroy, Linda

  Mactaggart, Fiona

  Godsiff, Roger

  McWalter, Tony

  Goggins, Paul

  McWilliam, John

  Griffiths, Nigel (Edinburgh S)

  Mahon, Mrs Alice

  Griffiths, Win (Bridgend)

  Mann, John (Bassetlaw)

  Grogan, John

  Marris, Rob (Wolverh'ton SW)

  Hain, rh Peter

  Marsden, Gordon (Blackpool S)

  Hall, Mike (Weaver Vale)

  Marshall, David (Glasgow Shettleston)

  Hall, Patrick (Bedford)

  Hanson, David

  Marshall, Jim (Leicester S)

  Havard, Dai (Merthyr Tydfil & Rhumney)

  Merron, Gillian

  Milburn, rh Alan

  Henderson, Ivan (Harwich)

  Miliband, David

  Hepburn, Stephen

  Miller, Andrew

  Hesford, Stephen

  Mitchell, Austin (Gt Grimsby)

  Hayes, David

  Moffatt, Laura

  Hinchliffe, David

  Mole, Chris

  Hodge, Margaret

  Moonie, Dr. Lewis

  Hoey, Kate (Vauxhall)

  Moran, Margaret

  Hope, Phil (Corby)

  Morgan, Julie

  Hopkins, Kelvin

  Morley, Elliot

  Howarth, George (Knowsley N & Sefton E)

  Mountford, Kali

  Mudie, George

  Howells, Dr. Kim

  Murphy, Denis (Wansbeck)

  Hughes, Beverley (Stretford & Urmston)

  Naysmith, Dr. Doug

  Norris, Dan (Wansdyke)

  Hughes, Kevin (Doncaster N)

  O'Hara, Edward

  Hurst, Alan (Braintree)

  Olner, Bill

  Iddon, Dr. Brian

  Organ, Diana

  Illsley, Eric

  Osborne, Sandra (Ayr)

  Ingram, rh Adam

  Owen, Albert

  Jackson, Glenda (Hampstead & Highgate)

  Palmer, Dr. Nick

  Pearson, Ian

  Jackson, Helen (Hillsborough)

  Pickthall, Colin

  Jamieson. David

  Plaskitt, James

  Jenkins, Brian

  Pollard, Kerry

  Johnson, Miss Melanie (Welwyn Hatfield)

  Pond, Chris (Gravesham)

  Pope, Greg (Hyndburn)

  Jones, Helen (Warrington N)

  Prentice, Ms Bridget (Lewisham E)

  Jones, Kevan (N Durham)

  Jones, Lynne (Selly Oak)

  Prentice, Gordon (Pendle)

  Jones, Martyn (Clwyd S)

  Prescott, rh John

  Kaufman, rh Gerald

  Prosser, Gwyn

  Keeble, Ms Sally

  Purchase, Ken

  Keen, Alan (Feltham)

  Purnell, James

  Keen, Ann (Brentford)

  Quinn, Lawrie

  214

  Rammell, Bill

  Stewart, David (Inverness E &
  Lochaber)

  Rapson, Syd (Portsmouth N)

  Raynsford, rh Nick

  Stinchcombe, Paul

  Reed, Andy (Loughborough)

  Stoate, Dr. Howard

  Robertson, John (Glasgow Anniesland)

  Strang, rh Dr. Gavin

  Stuart, Ms Gisela

  Robinson, Peter (Belfast E)

  Sutcliffe, Gerry

  Roche, Mrs Barbara

  Taylor, Dan (Stockton S)

  Rooney, Terry

  Taylor, David (NW Leics)

  Ross, Ernie (Dundee W)

  Thomas, Gareth (Clwyd W)

  Roy, Frank (Motherwell)

  Todd, Mark (S Derbyshire)

  Ruane Chris

  Touhig, Don (IsIwyn)

  Russell, Ms Christine (City of Chester)

  Trickett, Jon

  Truswell, Paul

  Ryan, Joan (Enfield N)

  Turner, Dennis (Wolverh'ton SE)

  Sarwar, Mohammad

  Turner, Dr. Desmond (Brighton Kemptown)

  Sawford, Phil

  Turner, Neil (Wigan)

  Sedgemore, Brian

  Twigg, Derek (Halton)

  Shaw, Jonathan

  Twigg, Stephen (Enfield)

  Sheerman, Barry

  Tynan, Bill (Hamilton S)

  Sheridan, Jim

  Vaz, Keith (Leicester E)

  Short, rh Clare

  Vis, Dr. Rudi

  Simpson, Alan (Nottingham S)

  Ward, Claire

  Singh, Marsha

  Wareing, Robert N.

  Skinner, Dennis

  Watson, Tom (W Bromwich E)

  Smith, rh Andrew (Oxford E)

  Watts, David

  Smith, Angela (Basildon)

  White, Brian

  Smith, rh Chris (Islington S & Finsbury)

  Wicks, Malcolm

  Wills, Michael

  Smith. Geraldine (Morecambe & Lunesdale)

  Winnick, David

  Woodward, Shaun

  Smith, Jacqui (Redditch)

  Woolas, Phil

  Smith, John (Glamorgan)

  Worthington, Tony

  Smith, Liew (Blaenau Gwent)

  Wright, Tony (Cannock)

  Soley, Clive

  Wyatt, Derek

  Squire, Rachel

  Starkey, Dr. Phyllis

  Tellers for the Noes:

  Steinberg, Gerry

  Mr. Fraser Kemp and

  Stevenson, George

  Mr. John Heppell

  Question accordingly negatived.

New Clause 4

  USE OF BUS LANES
  Any motor vehicle with two or more passengers shall be entitled at any time to use any carriageway marked out as a bus
  lane.&#x2014;(Mr. Greg Knight.]
  Brought up, and read the First time.
  Mr. Greg Knight: I beg to move, That the clause be read a Second time.
  Mr. Deputy Speaker: With this it will be convenient to discuss new clause 6—Bus lanes (use by other vehicles)—
  All bus lanes where buses are moving in the same direction as traffic in the adjacent or vehicle lane shall be open to use by cycles, motorcycles, licensed taxis and invalid vehicles.
  Mr. Knight: It must be about 25 years ago that the first bus lane was introduced in the United Kingdom. I think that it is appropriate, as this Bill is before us, that we take a look again at the operation of bus lanes in the UK to see whether we can strike a better balance and get more use out of bus lane capacity. All too often, we see empty bus lanes and congestion in other lanes. For much of the day in some cities, traffic is at a standstill, while alongside that congestion there are empty bus carriageways.

  215
  When bus lanes were introduced, they were sold to the public as a way of decreasing pollution by allowing buses to have quicker access to and from city centres. The argument went that if people caught the bus they would find that their journey was quicker because the bus would be able to use a dedicated bus lane. We were told that that was the environmentally friendly way to travel. However, I think we would all accept—at least I hope we would all accept—that bus lanes have not worked as well as we were told they would on their introduction. The reason for that is that, in many city centres during the rush hour, a third of the road capacity in one direction in some cases, and in others up to half the road capacity, is taken up with a dedicated bus lane.
  Mr. Forth: Does my right hon. Friend agree that enforcement of bus lane discipline is sadly lacking? I do not know whether he shares my experience but, driving in London, I see a rather regrettable number of violations of bus lanes, with apparently very little effort to enforce them. Does he not agree that enforcement, together with his proposal, would make a great difference?
  Mr. Knight: I would warn drivers who think that they can use the bus lane without getting caught to take care, because cameras have been installed at the front of buses to act as a video policing unit and record the details of any vehicle transgressing the current rules. I welcome that development. My right hon. Friend is right that enforcement has been and remains to some extent a problem, but detection rates are on the up because of the use of new technology.
  Law-abiding drivers have to sit in their cars in long traffic queues, increasing not only pollution but anger and frustration.
  Mr. Miller: They could get on the bus.
  Mr. Knight: Contrary to that sotto voce contribution, that is not an option that is available or appropriate to every motorist. Some people find that, although the bus may cover part of their journey, if they are travelling to a rural area such as East Yorkshire, the service is either woefully inadequate or non-existent. It is simplistic attitudes such as the hon Gentleman's that got us into this position. Many motorists cannot use a bus because it does not take them where they need to go. The enemy here should be pollution, not the motor car. As cars become less polluting, his attitude towards them should become more benign.
  Given that bus lanes do not work as well as we were told they would 25 years ago, it is now appropriate to reconsider the rules and guidance on their operation and try to make them work better. New clause 4 is designed to encourage car sharing. Its scope does not extend to contraflow carriageways: I do not argue that those should be opened up to other traffic, but a with-flow carriageway could be used by shared cars.
  This is not a unique or new proposition. Car sharing is encouraged in many states in the United States of America. If there are more than two passengers, the car
  216
  is entitled to use a dedicated lane. There is a real incentive to share a journey and thereby reduce car use, in turn reducing congestion.
  My right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) was concerned in an earlier debate about taking discretion away from local authorities. I accept that the new clause would do that, but I say good, because they have been singularly unimaginative in their approach to tackling this problem. I do not say that the Minister was misleading, but I do not think he painted an accurate picture when he replied to a similar debate in Committee. He gave the impression that it is all down to the local authority, but I have obtained a copy of the guidance issued by his Department, and it is not neutral on the subject.
  On page 15 of "Keeping Buses Moving" there is a reference to other vehicles using bus lanes. It says that this
  could encourage the rather different result of a switch to car sharing by public transport passengers.
  However, it does not go on to say why reaction over here should be any different from what happens in the United States. The next paragraph says:
  It is considered that while there can be no general case for allowing high occupancy vehicles to use bus lanes, there may be special situations where a high occupancy lane would be justified.
  The guidance is designed to dissuade local authorities from introducing bus lanes that other vehicles could use. That is a shame, and whether or not the Minister feels that local authorities should continue to have such flexibility, I hope that he will say today that ministerial encouragement should be given to innovation in this area. I also hope that he is prepared to encourage local authorities to establish whether car sharing in the United Kingdom would help to decrease the congestion that is all too often present in urban areas, not just in rush hours but for most of the day.
  4.15 pm
  Mrs. Gwyneth Dunwoody: I do not intend to detain the House for very long on this subject, but I want to discuss a very real problem that I have encountered. I have discussed it with the Department, but I received a factual reply that did not deal with it at all. I ask the Minister to give a moment's thought to the unfortunate milkmen in inner-city areas. Milk floats, which are by definition extremely slow and rather unwieldy, rightly have to avoid inner bus lanes because they would constitute a hazard. But delivering to customers in inner-city areas has become so difficult that many milkmen do not know how to proceed. One unfortunate milkman incurred £450 worth of fines in one week, which was more than he earned. If we as a nation want to encourage people to continue to buy bottled milk, we should think seriously about this issue.
  I should tell the Minister that I do not have any pet solutions—would that I did—but the traffic authorities need to be told that we desperately need such small tradesmen to continue to offer a service, particularly in urban areas. If they cannot deliver, they will soon give up trying and make their money elsewhere, which would be to the detriment of such services.
  In talking about clearing bus lanes, we should also consider the plight of the service provider during certain working hours. I do not pretend that finding a solution

  217
  will be simple, but unfortunately, the suggestion that milk be delivered during the night—superficially, that seems a good answer—ignores the fact that if it is delivered at such times in urban areas, it is not on the doorstep when the householder gets up in the morning.
  Mr. Redwood: Will the hon. Lady give way?
  Mrs. Dunwoody: I am happy to give way on the subject of milk bottles.
  Mr. Redwood: Is the hon. Lady suggesting to the Minister that small delivery vehicles should be exempt from bus lane rules? I would have a lot of sympathy with such a proposal.
  Mrs. Dunwoody: I hesitate to suggest that, but we do need to find a way to enable people to continue to deliver goods. I do not have a lot of sympathy for the very large chains, which could organise their deliveries accordingly and keep people on at night to open up stores and let in deliveries; however, for individual tradesmen this problem constitutes a significant hazard. Indeed, it is worrying many people and putting them off wanting to do the job.
  Would that I had an answer for the Minister. This is perhaps a unique parliamentary occasion, in that I have nothing to suggest, but he need only tell me that he will think hard about the matter and come up with a usable scheme.
  Mr. Paul Marsden: The intention behind new clause 4 is laudable. Given the need to reduce congestion, any suggestion that involves cars carrying more than one passenger is good in principle. The difficulty lies in the practical enforcement. I suspect that one of two scenarios will arise. To enforce the provision, an enormous amount of extra resources will have to be invested to provide more cameras to watch bus lanes; or we will end up like the United States, where there is a booming trade in suitcases containing pop-up secondary figures, which can be placed in the front passenger seat in order to fool traffic wardens and police officers. It is then going to be a waste of time, and it will also defeat the object of reducing congestion. On some urban roads where there are regular bus services—let us say every eight, 10 or 15 minutes—the congestion will clearly be worsened by cars being allowed into the bus lanes.
  I am more than happy, however, to support new clause 6, proposed by the right hon. Member for Wokingham (Mr. Redwood). It is eminently sensible and it highlights the current problem of enormous local variations, which leave many cyclists and motor cyclists confused as to whether they can or cannot use bus lanes. I hope that the Government will therefore accept new clause 6, but the Liberal Democrats cannot support new clause 4.
  Lembit Öpik: Does my hon. Friend agree that for single user travel, motor cycles represent an environmental benefit compared to cars; secondly, that motor cyclists are on the whole pretty responsible in their use of bus lanes; and, thirdly, that the Government themselves promised before 1997 to put motor cycles at the heart of their transport
  218
  strategies? Would it not be odd if the Government now refused to take seriously the provisions of new clause 6, so sensibly proposed by the right hon. Member for Wokingham (Mr. Redwood)?
  Mr. Marsden: I agree with my hon. Friend and I hope that the Minister will deal with that in his reply.
  As I said before, I would be interested to know whether the Conservative Front Benchers have costed the enforcement of the provisions in order to transform what seems to be a good idea into a practical outcome that would reduce congestion.
  Mr. Redwood: I rise to support my new clauses 4 and 6. With the oral amendment suggested by my right hon. Friend the Member for East Yorkshire (Mr. Knight)—that this should apply only to bus lanes where the traffic is moving in the same direction in and adjacent to the lane—new clause 4 makes a great deal of sense. Furthermore new clause 4 is complementary to my new clause 6. There is some overlap. For example, under new clause 4, a taxi with a passenger would automatically be able to use the bus lane, because it would be a
  vehicle with two or more passengers.
  Depending on the definition of "vehicle", the same would apply to a motor cycle with a passenger and there are other overlaps with public service vehicles.
  I hope that, on further reflection after hearing my remarks, my right hon. Friend might see the advantages of my new clause 6, as the hon. Member for Shrewsbury and Atcham (Mr. Marsden) has kindly done. The purpose of both new clauses is, as my right hon. Friend pointed out, to make greater use of the space of a bus lane without in any way impeding the progress of the bus. The purpose of the bus lane is to allow the bus to hit faster journey times with greater reliability. I do not believe that the proposals in either new clause—certainly not in new clause 6—would in normal circumstances get in the way of achieving that.
  In the case of new clause 6, I would argue that there are not only advantages stemming from greater use of the highway, but overriding safety considerations, to which I should like to draw the House's attention. The Liberal Democrats have briefly referred to them and I would have thought that they would recommend themselves to Ministers. Under the new clause,
  cycles, motorcycles, licensed taxis and invalid vehicles
  would be entitled to use the bus lane. The case for each is a little different, as I should like to explain.
  First, there is the cycle or push bike. I believe that it is very dangerous for cyclists in busy urban areas—where bus lanes are usually located—to have to jostle between large and sometimes fast-moving buses on the inside lane and every sort of vehicle ranging from fast cars to extremely heavy lorries on the outside lane, especially on narrow highways that may not initially have been designed to have both a bus lane and a mixed-vehicle lane in the same place.
  According to the highway code, cyclists should occupy the inside of the mixed-vehicle lane, which means that they are just on the outside of the bus lane. That can be an extremely dangerous position. A bus can

  219
  whistle along in the bus lane, which its driver can reasonably expect to be free. However, the driver must make the difficult judgment about whether a cyclist has the extra inches of clearance at the edge of the bus lane necessary for the safe passage of both vehicles. At the same time, the drivers of cars or lorries in the other lane might be attempting to overtake the cyclist, not realising that a bus is about to create the pressure—or pinch point—on the cyclist. That often leaves very little wobble room for the cyclist. [Interruption.] I see that the Minister is yawning, but he should appreciate the plight of cyclists in this respect. Although a bicycle may be correctly placed on the road, there may be a little overhang in the bus lane.
  Mr. Jamieson: Yes, I did yawn, partly because the right hon. Gentleman is going on at such length. Unless a local authority says otherwise, cyclists are permitted to use cycle lanes. That is why I was looking a little bored.
  Mr. Redwood: That is right, and if a cycle lane is provided along with a bus lane and a mixed-vehicle lane, my argument does not apply. However, there are many locations in the areas in which I travel regularly where there is no cycle lane parallel to the bus and mixed-vehicle lanes. My brief analysis of the cyclist's plight is very relevant and the Minister should listen carefully. I speak for many cycling interests outside the House. They would tell the Minister how perilous it can be to occupy the exposed—but correct—position on the highway, between fast travelling buses and relatively slow travelling other vehicles. That is where cyclists can get squeezed.
  Mr. Greg Knight: Perhaps my right hon. Friend and I can shake the Minister out of his boredom. Is he aware that, in 1995, the Conservative Government gave the go-ahead for a trial in the Bristol area allowing motor cyclists to use bus lanes? A period of assessment was given to determine whether there was any detrimental effect on safety, and I understand that the safety record was excellent. Is it not now time for us to grasp the opportunity and introduce the provision elsewhere?
  Mr. Redwood: I am grateful to my right hon. Friend, and I shall come to the subject of motor cycles when I have finished talking about cyclists. New clause 6 would give cyclists the choice about where to ride. I think that most would prefer to ride in the bus lane, close to the kerb. There are fewer buses than other vehicles, and bus drivers would be aware that cyclists could be encountered there. As they approached from behind, bus drivers would be under a duty to move out around the cyclist if there was a potential conflict. Cyclists in that position would not then face the twin pressures of the mixed-vehicle lane and the bus lane at the same time.
  My proposal means, however, that cyclists could be on the inside of the mixed-vehicle lane and the bus lane, if that is what made sense in the circumstances. Also, a cyclist who wanted to turn right would have to move over to the inside of the mixed-vehicle lane to complete
  220
  the manoeuvre. Cyclists would therefore have greater flexibility. They are the most vulnerable of road users, and that necessary extra flexibility would be welcome.
  Mr. Forth: Does my right hon. Friend accept that there is a potential problem here? Cyclists who use the inside of the designated bus lane—which I hope will include vehicles in multiple occupation—force the drivers of buses and other vehicles to move out when they want to pass. That partly blocks the mixed-vehicle lane. Does my right hon. Friend agree that it is possible that the total traffic flow will slow down as a result? Has he taken that into account?
  Mr. Redwood: I have taken it into account, but the problem is not major. The advantage of my proposal is that, in normal circumstances, the bus will be travelling much more quickly than the cyclist. The manoeuvre involved will therefore take only a very limited time. There will be problems in very heavy traffic, but I submit that even bigger problems will remain if this extra flexibility that I propose is not given to cyclists. The congestion incident that my right hon. Friend described will still occur, but cyclists would occupy a different position on the highway. If the highway is not wide enough to accommodate bike, bus and other vehicles—the analysis offered by my right hon. Friend—it will not be wide enough to accommodate bus, bike and other vehicles, which is the disposition covered by my new clause. I think, therefore, that my right hon. Friend's point is not strong: the case is neutral, because both analyses reveal that a problem is created when a highway is too narrow to accommodate a bus lane and another lane.
  4.30 pm
  My right hon. Friend the Member for East Yorkshire has indicated that motor cycles are a different case. The extra flexibility would be a good idea for them, because we have all experienced motor cyclists weaving in and out of heavy traffic to get to the front of the queue and optimise the power and relative thinness of their machines compared with other vehicles. Giving motor cyclists the choice between the bus lane or the multiple-occupancy vehicle lane would probably help to minimise incidents in which they collide with wing mirrors or other parts of vehicles in the multiple-occupancy vehicle lane.
  Motor cycles would not get in the way of buses because in practically every case they have better performance than buses and obviously keep themselves well out of the way, normally by accelerating away from contact. Such flexibility would be an added welcome freedom for motor cyclists and would reduce conflicts between them and other vehicles. They are currently crowded into the multiple-occupancy vehicle lane and cannot get into the bus lane to get free of other vehicles, which might reduce collisions as bus lanes tend not to be used and are more likely to contain free space for motor cyclists.
  Lembit Öpik: The Motor Cycle Industry Association has examined the evidence and made it clear that it is safer for motor cyclists and better for the environment to make it easier for people to use two wheels instead of

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  four when they choose to travel alone. That point is born out by the expert literature, including Motor Cycle News, which backs up the right hon. Gentleman's point that there is no downside to allowing motor cyclists in bus lanes because buses will never be held up by higher-performing motor cycles.
  Mr. Redwood: I agree with the hon. Gentleman's views. Motor cycles will not normally hold up buses, and allowing them to go in bus lanes will give them greater flexibility. The multiple-occupancy vehicle lane is often congested, which makes it difficult for motor cyclists and other vehicle users.
  The green argument, which probably informed much of the original work on bus lanes, contains a mistake. The sad truth is that buses travel around this country with, on the whole, few occupants. The average bus has only nine passengers, although occupancy is obviously much better during rush hours in urban areas. If a bus is travelling around with so few passengers, it is, of course, a less green option than all those people travelling in their respective modern motor cars. The average bus is quite old and average fuel efficiency is very poor as a result. It is a less green option to switch people out of modern cars into older buses unless the buses achieve high occupancy rates, which is a point that should inform debate on the selection of bus lanes. The green argument for bus lanes only holds in areas in which high occupancy can be obtained with frequent services that people can rely on.
  The case for licensed taxis is easy. Licensed taxis are, after all, public service vehicles that offer a service to the general public, and they often help those who find it most difficult to get around in our community. I should have thought that they, like buses, should obtain some advantage from the use of privileged lanes. That is not only my view but that of many Labour, Liberal Democrat and Conservative councils around the country, which can allow taxis in bus lanes.
  In many cities, oddly, some bus lanes allow taxis and others do not. In some cities, some lanes are taxi friendly and others are not. Such situations make it difficult for novice taxi drivers, and taxi passengers cannot understand why they sometimes buy an advantage and other times do not. A general measure to allow taxis in bus lanes would be welcome to taxi drivers and passengers countrywide. The point is certainly important in the evenings when people want to go out. If it were easier and cheaper to use taxis because they travel quickly down bus lanes, it would encourage people to use them rather than their own cars, and if people are tempted to have a drink there is no possible danger to them or other road users.
  Finally, invalid vehicles are slow-moving vehicles used by some of the most vulnerable people in our community. I am not saying that they must use the bus lane—it is difficult for them to decide where they should go on a busy road with both a bus lane and a multiple-occupancy vehicle lane but it would be good to give them the choice because some of them might feel safer if, like bicycles, they travelled close to the curb with a threat from one stream of traffic only rather than having to travel in the multiple-occupancy vehicle lane. That lane probably contains a threat from both types of traffic because invalid vehicles are often relatively
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  narrow and other vehicles think that they can get past them, which is not always the case on a narrow stretch of two-lane road.
  It must be terrifying for some people in those vehicles on busy roads with two lanes, where they are sandwiched in the middle. I would like to give them the choice. They would not have to use the bus lane, but they would probably welcome the choice. I hope that I can persuade my right hon. and hon. Friends and the Liberal Democrats to agree with new clause 6, and I am happy to support new clause 4, especially with the amendment to make it clear that it does not apply to contraflow bus lanes.
  Mr. Forth: I admit that I am puzzled by what my right hon. Friend the Member for Wokingham (Mr. Redwood) has just said. I am not sure that there is an amendment to new clause 4. My right hon. Friend the Member for East Yorkshire (Mr. Knight) tried to slip one in, rather cleverly, but I am not sure that it is valid. I am therefore puzzled as to whether I am debating the wording as it appears on the amendment paper, which states:
  Any motor vehicle with two or more passengers shall be entitled at any time to use any carriageway marked out as a bus lane.
  Perhaps my right hon. Friend, by some parliamentary sleight of hand of which I was hitherto unaware, has managed to change it to resemble more closely new clause 6.
  Mr. Redwood: I think that my right hon. Friend the Member for East Yorkshire (Mr. Knight) was hoping that the Minister would think that his suggestion was a good idea and would wish to have a similar amendment tabled in the other place.
  Mr. Forth: It remains to be seen whether my right hon. Friend the Member for East Yorkshire wishes the Minister to take up the wording on the amendment paper or the wording of his verbal amendment. I thought that I would try to clarify that point, and I am not sure that my right hon. Friend the Member for Wokingham has helped me to do so.
  I approach the issue from my experience of driving on the 1-5, which passes through Seattle, between Portland, Oregon and Vancouver, British Columbia. On a lengthy stretch of that road, which is arguably one of the busiest interstates in the USA, especially at rush hour, there is a traffic lane dedicated to vehicles carrying two or more persons. From my observation of that experiment, it works well and makes a lot of sense. It is not a theoretical exercise, but a practical one. We can look to such examples, especially in the United States, and draw on them.
  Mrs. Dunwoody: Do I detect a slight imbalance in the amount of road space used by roads in the United States, especially in Oregon, compared with this country? From personal experience, Oregon is a rather larger county than any of the ones that the right hon. Gentleman and I normally deal with. Would not the space available affect the issue?
  Mr. Forth: The good people of Oregon would be extremely upset if their state were referred to as a

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  county. It is a great state and it is indeed fairly large. We should bear it in mind that our entire country could fit into the state of Wyoming, which has a population of only some 500,000. However, it would appear that that is a thought upon which you do not wish me to dwell, Mr. Deputy Speaker, given the expression on your face. I take the hon. Lady's point. The United States has more space, generally speaking, for carriageways, even in the urban area of Seattle, but American vehicles are wider than ours. I do not wish to press the parallel to the distress of the hon. Lady, whose knowledge of such matters is greater than mine is ever likely to be. I simply raised the issue as a tentative example of how allowing a lane to be dedicated to a certain type of vehicle, whether for buses or vehicles in multiple occupation, is probably a good idea and seems to work well.
  The hon. Member for Shrewsbury and Atcham (Mr. Marsden) raised a reasonable point about enforcement, which ties into the intervention I made as my right hon. Friend the Member for East Yorkshire introduced new clause 4. If there is a problem, it is the lack of proper enforcement of the bus lanes that already exist. To that extent, there might be a concomitant problem of enforcement if the new regime were put in place. but that is an argument for more effective enforcement in general rather than a specific objection to new clause 4. I hope that the Minister will examine the proposal positively following the debate and bear the enforcement point in mind.
  I generally followed the argument that my right hon. Friend the Member for Wokingham deployed when he spoke to new clause 6, although with the reservation that I expressed in my intervention. If we encouraged cycles and motor cycles, especially, to use such designated bus lanes, it might exacerbate traffic congestion because larger vehicles such as buses might be caused to swerve around two-wheeled vehicles and thus perhaps obstruct the mixed vehicle lane. However, I accept my right hon. Friend's analysis that that would probably be a price worth paying and that, given the benefits that we would get and the encouragement that the measure would give to people to use two-wheeled vehicles, it should probably at least be tried.
  The introduction of pilot schemes and observing how the system would work might be worth exploring, although that suggestion is not explicitly provided for in the new clauses. We do not need to rush into such schemes completely when we embark on them. I am sure that the Minister accepts that pilot schemes are often a good idea, especially when assessing such suggestions. Perhaps different variations of the scheme could be tried and observed.
  We thus come to the intriguing difference between new clause 4—before the attempted verbal amendment on the hoof by my right hon. Friend the Member for East Yorkshire, which was a novel parliamentary experiment—which would allow any carriageway to be used, and the more explicit provision drafted by my right hon. Friend the Member for Wokingham in new clause 6, which would apply if traffic were
  moving in the same direction
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  as buses. Perhaps, again, it would be worth piloting different approaches. I am intrigued by the prospect of contraflow traffic containing a mixture of different vehicles. It might sound like a recipe for chaos on the face of it, but it might work perfectly well and ease traffic flow in some circumstances. I would not want to dismiss either formulation out of hand. We could easily accept either formulation, determine how it works and find out how it could be extended nationwide.

  My right hon. Friends have done us a great service by proposing such imaginative and experimental ideas. I hope that the Minister is in an imaginative mood, although he does not seem to be in any sort of mood except a somnolent one. When he replies to the debate, I hope that he will sparkle, impress on us the fact that he has grasped all the imaginative suggestions, and say that he might be prepared to carry them forward, rather than laying the dead hand of officialdom and bureaucracy on them, as is, regrettably, all too often the way. This is a bit of a challenge to the Minister. We have put the suggestions forward—I am happy to support them—and rather than dismissing them out of hand, I hope that he will give us some encouragement and indicate that he will be prepared to consider them, perhaps through pilot schemes or experiments, so that when we come into government, we can report back to the House that they have been successful.
  Mr. Jamieson: I shall endeavour to sparkle this afternoon, as suggested by the right hon. Member for Bromley and Chislehurst (Mr. Forth). I agreed with the points made by the right hon. Member for East Yorkshire (Mr. Knight) at the start of his speech when he said that we want better use of our roads and bus lanes. I did not quite follow his argument about buses in East Yorkshire, however, because when I was last there, I did not see many bus lanes in some of the rural areas—they were mainly in more urban areas. Perhaps he will inform the House where they are. He will know the area far better than I do.
  4.45 pm
  The arguments that we have had today were well rehearsed in Committee, and I am delighted that we are hearing them again today. Bus lanes are generally provided to enable buses to avoid the queues that occur in congested road networks. The higher carrying capacity of buses means that the lanes make efficient use of road space in terms of moving people, and the quicker and more reliable journey times that follow make buses a more attractive and realistic option, thus further relieving pressure on the road network. The more other vehicles are allowed to use bus lanes, the more the purpose and effectiveness of those lanes is devalued.
  New clause 4 would effectively turn all bus lanes into high-occupancy vehicle lanes. It is easy to envisage that bus lanes would become choked by other traffic and that the presence of other vehicles in a bus lane would encourage the drivers of single-occupancy vehicles or those carrying just one passenger to use the lane as well. That would delay buses and lead to enforcement problems.
  The right hon. Member for East Yorkshire talked about using new technology such as cameras to enforce bus lanes. Of course, cameras can be used to distinguish

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  between buses and other vehicles, but there is considerably more difficulty in distinguishing whether a car has one, two or three occupants, as the new clause would require. That is why the enforcement of high-occupancy vehicle lanes in Leeds and south Gloucester relies on a police presence and the ability to stop vehicles apparently contravening the rules. There was a complaint from one lady who had a small child strapped in the back of her car who, of course, was not visible to the police officer from outside the car. There are difficulties and anomalies in trying to enforce such rules.
  I recognise that, in the right place, high-occupancy vehicle lanes can be an effective traffic management measure, and the right hon. Member for Bromley and Chislehurst will be pleased to know that, later this year, my Department will be publishing guidance to authorities on the implementation of such lanes. Who knows, in the very long term, when the right hon. Gentleman and I are well retired, there may be a Conservative Government implementing some of these plans.
  Mr. Greg Knight Mr. Greg Knight rose—
  Mr. Jamieson: I was just coming to the right hon. Gentleman's point about high-occupancy vehicle lanes, but I will give way.
  Mr. Knight: We welcome what the Minister said about issuing guidance. Will it be general guidance that, in effect, updates what is now the seven-year-old guidance on bus lanes? The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) raised an interesting point. The original guidance referred only to heavy goods vehicles using bus lanes in some cases, and there may be a case for short-run delivery vehicles being included as well. Will the guidance be all-embracing?
  Mr. Jamieson: The guidance will relate to high-occupancy vehicles.
  I do not have the experience of the right hon. Member for Bromley and Chislehurst of travelling in the United States of America, but I think that I have travelled on the road outside Seattle to which he referred. Like my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody), I noticed that it was rather wider than even the widest motorways in this country. I noticed also that it had no bus lane but rather a high-occupancy vehicle lane, whereas the new clauses relate to bus lanes, which are mainly in confined urban areas that in no way equate to the great intercity highways of the USA. Interesting though his point was, it does not easily read across to this country.
  My hon. Friend the Member for Crewe and Nantwich made an interesting point about the problem for milk floats and other service providers. The milk float in my area arrives at 4 am, making a considerable noise and usually waking me up at the same time. I accept that there is a problem, because for people who find it difficult to get to the shops those deliveries are a lifeline. Delivery companies also provide employment. She
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  asked if I would go away and think hard. I certainly shall, as long as she does likewise. I would be happy to put our brains together to find a solution.
  Mr. Redwood Mr. Redwood rose—
  Mr. Jamieson: The right hon. Member for Wokingham (Mr. Redwood) is offering to join us in a troika to solve the problem.
  Mr. Redwood: Has the Minister thought about bus lanes' hours of operation, because milk floats often go out early, so they may not conflict with the frequent service provided by buses? Is it not possible to make the bus lane inoperable early in the morning so that delivery vehicles can use it?
  Mr. Jamieson: Again, I find myself agreeing with the right hon. Member for Bromley and Chislehurst, who is at odds with his Front Bench, as I believe that such things should be decided locally. Local authorities should work with local companies to see if we can accommodate such arrangements. In some areas, bus lanes are not required 24 hours a day, but it is important that local authorities make those decisions. The House will be surprised to learn that I do not favour the big state intervention that the hon. Member for Christchurch (Mr. Chope) advocated —[Interruption.] I see that the right hon. Member for Bromley and Chislehurst agrees with me.
  Mrs. Dunwoody: Before we leave our unfortunate milkman, there is an added hazard when delivery vehicles are subject to a congestion charge. I am afraid that I do not have an instant answer—I wish that I did—but I hope that we can find a way to assist small deliveries. Given the level of petty theft in urban areas, it is not possible to ensure that delivered goods are still there when people get up to collect them. It is a difficult but genuine problem.
  Mr. Jamieson: I accept that it is both difficult and genuine. Equally, if milk floats used bus lanes regularly, it could inhibit the flow of buses, and local people would have a view about that. There could also be a considerable hazard—the right hon. Member for Bromley and Chislehurst said that buses would be weaving in and out of the next lane, which would create safety problems.
  Mr. Redwood: I do not know of any place that needs a 24-hour bus lane. Bus lanes are needed only in busy periods when there is a frequent bus service. Outside those hours, buses could easily use the outside lane, because there would not be a great number of other vehicles, allowing delivery vehicles to do their job.
  Mr. Jamieson: In certain parts of the country—this is particularly true of London and big conurbations— there are 24-hour bus lanes because buses run 24 hours a day. In the night, there is no need to lift the restriction on using bus lanes because the roads are reasonably clear of cars anyway. The real problem was identified by my hon. Friend the Member for Crewe and Nantwich. We need to address it, along with local authorities and suppliers to see if we can reach an accommodation. I

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  cannot see an easy solution to the problem, and I do not believe that she can either. It has been drawn to my attention that, in an intervention on the right hon. Member for Wokingham, I referred to cycle lanes rather than bus lanes. I meant that that cycles were permitted to use bus lanes, but he probably inferred that.
  New clause 6 would require all with-flow bus lanes to be open to use by cycles, motor cycles, taxis and invalid carriages. It is unnecessary for cyclists, who already have a right to use with-flow bus lanes. The Secretary of State's consent would be required if a local authority wished to exclude cycles, but it is rarely requested or given. A small number of bus lanes may exclude cycles for safety reasons, for example where cyclists are encouraged to use a parallel cycle track rather than a narrow bus lane. If it could be provided that there was a cycle track as well as the bus lane, that would be a considerable advantage to the cyclist, but one has only to look at the roads in London and many other urban areas, including my constituency, to see that it would be almost impossible to provide a facility for a bus lane and a cycle track in the available space.
  As for motor cycles, taxis and invalid carriages, local authorities have the power to allow other vehicles to use bus lanes if they consider that that would be desirable. We believe that it should be left to the discretion of local authorities to decide whether any other classes of motorised traffic should be allowed to use any of their bus lanes, taking into account their local transport plans and specific objectives in creating those bus lanes. That cannot be done effectively by central Government.
  The right hon. Member for East Yorkshire mentioned the guidance on bus lanes in local transport note 1/97, "Keeping Buses Moving". That acknowledges that there are circumstances in which it will be appropriate and desirable for other vehicles to use the bus lanes and gives guidance on assessing the effects on buses and other road users. I stress to the right hon. Gentleman that that is guidance, not instructions, to local authorities. I emphasise for the third or fourth time that it is important that, working within the guidance, local authorities make decisions appropriate to their own circumstances.
  Some local authorities have allowed motor cyclists to use bus lanes. That has raised concerns for the safety of other road users, particularly for cyclists and pedestrians. Before revising the guidance, we are awaiting the results of trials in London allowing motor cycles in bus lanes. It would be premature to give an unconditional recommendation that motor cycles should be able to use bus lanes, let alone to give them standard access.
  Generally, it is better for invalid carriages to use footways, rather than the carriageway, wherever that is possible. It is not a good idea to encourage such small, low-powered, slow-moving vehicles to use bus lanes. Apart from the danger of their being ridden over because the bus driver cannot see them in his mirrors, moving at a maximum speed of 8 mph they would considerably inhibit the flow of traffic behind them.
  The new clauses are not necessary in relation to cyclists, and in relation to the other vehicles, they would undermine the effectiveness of bus lanes by removing the
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  right of local authorities to decide which other vehicles, if any, should be allowed to use bus lanes. I therefore ask that the motion be withdrawn.
  Mr. Greg Knight: The Minister is on a roll this afternoon. We have enjoyed listening to him. He has been bold, helpful, and willing to listen to views expressed in the House and the points raised in the debate. Knowing how the Government Whips Office works, I should warn him that he is in danger of being shuffled off to another Department because he is being too helpful to the House.
  Before the Minister rose to speak, I wrote on a piece of paper what I intended to say to wind up this part of the debate: the guidance is seven years old, needs updating, is overcautious and restrictive, and the Government should update it. He guessed that that is what I intended to say, and I warmly welcome the fact that we are to get new guidance. I hope that he will put a copy in the Library so that right hon. and hon. Members can see it.
  Our main criticism of the guidance that is seven years old is that it leads local authorities to act too cautiously and not to consider innovations that may be suitable for the locality that they serve. My right hon. Friend the Member for Wokingham referred to motor cycles being allowed to use bus lanes. Apart from Bristol, as far as I am aware, there is no part of the country where that is allowed. Although the guidance makes it clear that the decision can be made locally, at the end of paragraph 4.12 on motor cycles, it states:
  The Department recommends that motorcycles should not normally be permitted to use bus lanes.
  I hope that when the new guidance is issued, it will be more neutral in what it says to local authorities. It should point out the range of options that are available to them and allow them to make their own decisions.
  5 pm
  The hon. Member for Shrewsbury and Atcham (Mr. Marsden) and my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) expressed concern about the policing of bus lanes where other vehicles are allowed to use them. That should not be a problem given the advent of new technology—digital cameras are better than the earlier analogue ones—and a policy of unannounced and occasional policing. Policing a law by which certain motorists are not supposed to be in a vehicle unaccompanied—for example, learner drivers are supposed always to have a qualified driver with them—does not present a particular problem and, as camera imaging gets better and more buses have cameras inside, this should not be an insurmountable problem either.
  The draconian business motion leaves me with a dilemma: should I test the mood of the House or save 15 minutes of debating time to raise issues further down the amendment paper? In the light of the Minister's helpful response and the fact that he is to issue new guidance, which we warmly welcome, I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New Clause 5

  TRAFFIC LIGHTS
  In exercising their network management duty, a local traffic authority (or, in London, Transport for London) shall be required to monitor all traffic lights in operation in their area and shall&#x2014;

  ensure that all traffic lights operate on a traffic sensitive basis during non-rush hour periods;

  require that traffic lights are set to achieve the most expeditious flow of traffic and pedestrians at all times they are operational;

  require that unless there are good reasons for not so doing that traffic lights at junctions with low traffic volumes operate in amber warning mode in all directions during non-rush hour periods.&#x2014;[Mr. Greg Knight.]

  Brought up, and read the First time.
  Mr. Greg Knight: I beg to move, That the clause be read a Second time.
  Mr. Deputy Speaker: With this it will be convenient to discuss the following:
  New clause 8—Network management duty—
  In exercising their network management duty, the local traffic authority shall be required to ensure:

  that all traffic lights operate on a traffic sensitive basis during non rush hour periods,

  traffic lights are set to achieve the most expeditious flow of traffic and pedestrians at all times they are operational,

  that traffic lights give longer green phases to main roads than to side roads and give continuous green phases to main roads during quiet times of the day and night, save where the traffic sensors recognise traffic on approaching side roads.'

  Mr. Knight: I cannot think of a single factor that induces road hypertension more than having to stop at a set of traffic lights at a junction on a main road only for no traffic to emerge from a minor road and no pedestrians to seek to cross. Yet that happens in every city in the United Kingdom every day during non-rush hour periods—it certainly happens on the streets around this building. Traffic lights should be responsive to the flow of vehicles on our roads. If they are not, we end up with unnecessary tailbacks, which are far too common in our urban areas. Indeed, on most occasions when I leave this place at an early hour, I find that I am, along with other motorists, obliged to stop and wait at traffic lights that are showing red, only for no vehicles to cross the junction. There must be a better way of operating traffic lights. Unnecessary red lights add to pollution, add extra time to people's journeys and add to congestion.
  Does the Minister know what percentage of traffic lights are capable of operating in traffic-sensitive mode? Wherever new traffic lights are installed or old ones refurbished, there should be some requirement on those responsible to install traffic lights that can operate on a traffic-sensitive basis.
  Mr. Redwood: I hope that my right hon. Friend would not limit traffic sensors to new traffic lights, but would want retrospective fitting to take place as soon possible, because many would benefit from it.
  Mr. Knight: I agree with my right hon. Friend. I was trying, in the first instance, to find out from the Minister
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  whether, as a matter of good practice, it is a requirement that all new traffic lights are capable of operating on a traffic-sensitive basis. I hope that he will confirm that that is the case.
  I hope that the Minister agrees that traffic lights should never be operated in a fashion other than to ensure the most efficient movement of traffic and pedestrians at a road junction. A report that appeared in the Evening Standard on 2 February this year refers to a particular set of lights in London and challenges its readers:
  "Have you found a worse set of lights? &#x2026;Situated at the junction where The Mall meets Trafalgar Square, they are responsible for some of the most notorious tailbacks in town. The reason is obvious to anyone who has sat in the ever-lengthening queue of cars trying to get to Trafalgar Square: they simply do not stay green for long enough.
  The report continues:
  We studied the lights on different working days, at different times, and found: the lights changed from red to green every one minute and eight seconds; the lights stayed on green for only eight seconds each time.
  Mr. Forth: I know that my right hon. Friend has driven quite a lot in the United States, as have I. He will know that in many states a driver is allowed to turn right at a red traffic light, provided that he is satisfied that the road is clear. Does my right hon. Friend think that we should carefully consider the idea of allowing people to turn left at red traffic lights in this country, to help partially to solve the problem that he describes?
  Mr. Knight: I agree. We floated that idea in Committee, and if my right hon. Friend examines new clause 5(c), he will see that it seeks to introduce another innovative measure from the United States: setting traffic lights that control low-density traffic flows to flash amber in all directions at non-rush hour periods, in effect signalling to motorists from all directions to cross the junction with care.
  The report in the Evening Standard points out that those particular lights have caused such anger and frustration in the film director Michael Winner that he
  has pledged to stand for Mayor of London on the single issue of getting them changed.
  The RAC Foundation, when asked to comment, said of the lights:
  Having just eight seconds for motorists to squeeze through means that they are so frustrated they end up jumping red lights.
  I presume that that refers to other red lights.
  Mr. Redwood: On that crucial point, would my right hon. Friend use his considerable powers of persuasion to suggest to the Conservative candidate for Mayor of London that if he took up that popular policy—both on the specific lights at the approach to Trafalgar square and on the more general problem—he would win many votes?
  Mr. Knight: I think that if I strayed too far into my conversations with the Conservative candidate for Mayor of London, you would call me to order, Mr. Deputy Speaker. However, may I just say that in all my conversations with Steven Norris on this matter, I have found him helpful and willing to listen? I think that he will take note of the points made in this debate.

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  A report in The Daily Telegraph on 10 February last year said:
  "Traffic congestion in London is costing business about &#x00A3;3.4 million a day, according to calculations by the London Chamber of Commerce, and conditions are getting worse. But business analysts point out that the jams are not being caused by more vehicles coming into London. Indeed, the AA's figures suggest there are actually fewer cars in central London now than there were 20 years ago . . . There has, however, been a sharp increase in the number of traffic lights, and in some parts of central London they are now on average only 80 yards apart. In addition, the timing of 170 of the 562 traffic lights in the central ring has been altered to slow the traffic even further.
  That is the main complaint that new clause 5 seeks to address.
  I do not know whether the Minister has made any studies of the situation in America to which I have referred, but we should be prepared to look at schemes that are in place in other countries, and embrace those that work. I have seen no evidence that the amber flashing system, which the Americans use regularly in non-rush hours, has led to an increase in the number of accidents. I hope that the Minister will be prepared to reflect on that, and perhaps give the go-ahead to a pilot scheme somewhere in the United Kingdom if he does not feel able to accept new clause 5.
  se sole aim is to reduce congestion. It does not seek to put pedestrians at risk, but has one aim only: congestion busting. I therefore hope that he will welcome it.
  Mr. Redwood: I rise to support new clause 5, tabled by my right hon. and hon. Friends, and to speak to my parallel new clause 8. I shall highlight the differences between them, but there are also many similarities. Both are designed to get traffic flowing more freely again.
  As my right hon. Friend the Member for East Yorkshire (Mr. Knight) has ably pointed out, the position in London is particularly chronic. There has been a deliberate attempt by the highways authorities to block and slow the traffic. We have seen reduced green phases and increased red phases at many sets of traffic lights, and the introduction of a large number of additional traffic lights, some of which are unnecessary or undesirable. In the centre of London, we now also have traffic lights with the new feature of an all-red phase, which means that traffic coming to the junction from each direction has to sit there looking at all the other stationary traffic. Let us imagine the cost of that in terms of fumes, frustration, pollution and inconvenience. There are often no pedestrians wishing to cross those roads at the time of the all-red phase.
  I am mainly a pedestrian in central London. I bring my car in on a Monday morning, and I leave it here until my duties are finished. I do not try to drive round the centre of London in my car. I normally walk, because I find that that is the quickest mode of travel, now that the traffic system has been wrecked and the underground functions so badly. So I look at this situation from a pedestrian's point of view, but I cannot say, as a pedestrian, that I want all-red phases. I often do not want to wait for the red phase at all, and I would not do so if it were safe for me to cross. It is perfectly reasonable
  232
  for pedestrians at busy junctions to have to row in with the traffic light system, just as vehicles do, so that the pedestrians cross the road during the red phase. If they wished to cross again in a further direction, which is unusual, they would also have to wait for a red phase there, so that it would be safe to cross.
  The new clauses are designed to deal with the inconvenience created by the prevalence of red phases over green phases, and particularly to tackle the new injustice of the all-red phase, which does not help or amuse me as a pedestrian and which is extremely frustrating to all those who need or have to drive around London. It is particularly frustrating to all those carrying out their trade, using a van, milk float or other commercial vehicle. They have to use their vehicles because the tools and stock of their trade are inside them. Those people now have to sit at traffic lights for a great deal of the day, which increases prices, reduces efficiency, annoys people who live near the road blocks, and increases the amount of pollution.
  New clause 5 proposes that
  all traffic lights operate on a traffic sensitive basis during non-rush hour periods.
  If properly implemented, that measure would make an immediate improvement. We all have experience of travelling round busy towns and cities in the evening or the early morning, and of having to sit at red traffic lights when there is nothing moving in the other direction. Proper traffic sensors on the lights would remove the inconvenience, the congestion, the pollution, the delays, and the extra noise and fumes for people living nearby.
  The second part of the new clause proposes that
  traffic lights are set to achieve the most expeditious flow of traffic and pedestrians at all times they are operational.
  That addresses directly the question of whether there should be all-red phases. The answer is that there should not, and that there should be a sensible balance between the needs of the different road users and roads coming into the junction. We need to balance the needs of pedestrians and vehicles, and to make a decision as to which is the major road and which is the minor, giving sensible priority in most cases to the major road.
  The third part of new clause 5—which differs markedly from my proposal in new clause 8—proposes that, unless there are good reasons for not doing so,
  traffic lights at junctions with low traffic volumes operate in amber warning mode in all directions during non-rush hour periods.
  I could live with that proposal. Traffic sensors changing the lights from red to green or green to red, as appropriate, in response to traffic demand would be even safer and easier, so I would favour that option. However, if my right hon. and hon. Friends want to press new clause 5 to a vote, I should be happy to support it, because the intention is good. People would, however, have to be a bit more careful, because there could be traffic approaching a junction on amber from both directions. We would also need a sensible definition of low volume, so that the opportunities for conflict were reduced.

  233
  5.15 pm
  That brings me to my new clause 8, which contains the provisions
  that all traffic lights should operate on a traffic sensitive basis
  and that all traffic lights should be
  set to achieve the most expeditious flow of traffic and pedestrians.
  The other feature of my new clause, instead of the amber flashing mode, is that
  traffic lights give longer green phases to main roads than to side roads and give continuous green phases to main roads during quiet times of the day and night, save where the traffic sensors recognise traffic on approaching side roads.
  I submit that that is a safer variant than the amber flashing lights.
  In most cities and towns, there is a clear main road—the A-road, the trunk road or the main route that goes through the principal settlement or links the connected settlements that form a great city—and a series of side roads intersect with the main route. Where that is clear, surely the highways authority should programme the traffic lights to give priority off-peak, all the time, to the busier main road, with the proviso that there should be a traffic sensor so that people are not stranded on the intersecting side roads for ever. In many cases, they would get early change to green if the traffic flows permitted that on the main route. That would be much fairer: it would reduce frustration as well as the need to burn so much petrol, change down and come to a halt, often with the engine running, while people wait for what seems like a long time late at night for the lights to change.
  There we have it. There are two parallel proposals on the table. One, influenced more by the United States, involves the amber flashing light; the other is influenced more by the British tradition of using the technology of traffic sensors. The Minister may argue that there would be a cost involved in installing traffic sensors in traffic lights. I quite agree, but it would be modest compared to the huge sums spent on obstacles and blocks to traffic in recent years. Most road users would think it was money well spent.
  I recommend that it be assumed that, over a reasonable period, that cost would get us up to modern traffic management standards. The savings in terms of less congestion, less fuel burned, less frustration, less delay and less cost to business would be considerable.
  The Minister may also say that he favours local autonomy in that respect as in others. I would find that easier to believe if we did not have before us this Bill in this shape. The Bill is about establishing national standards of traffic management and investigating how well local authorities do. It is about, in extreme cases, moving in and taking over traffic management duties if the local authority has failed.
  I am offering the Minister a way to ensure that local authorities, in more cases than not, succeed in improving traffic flows and busting congestion so that he does not have to make a heavy-handed intervention, which he will be entitled to do if the Bill is passed. So, far from my proposals being an additional blow to local autonomy, they could be a buttress to sensible local autonomy, which would mean that fewer local authorities got into the danger zone on their traffic
  234
  management practices and had to face the extreme intervention of the whole system being taken out of their hands to be run by somebody else.
  The Government and local authorities seem to be interested in the use of technology to advise, warn, marshal and control traffic. I am recommending an old and well-established technology that would do the job at a relatively modest price and relatively simply. I have been trying to persuade my local authority, which is keen to get traffic moving and bust congestion, to change the phasing of lights. It has been obliging in many cases and is conducting an exercise at the moment, junction by junction.
  The authority is discovering that it can improve the capacity of leading congested junctions in the district quite substantially, simply by changing the phasing and timing of lights. If traffic sensors are added, the effect is even better—particularly off-peak when there is no need to hold up the traffic on principal routes. I recommend that the Government adopt a scheme along the lines of new clause 8 and have pleasure in supporting my right hon. and hon. Friends in new clause 5.
  Mr. McNulty: I cannot recall whether I raised the Mall-Whitehall issue in Committee but a greater propensity for green lights at that particular junction would only move the delay elsewhere. It is part of a network rather than an individual set of lights. In a network, one cannot look at each traffic light junction in isolation. That would be simplistic and unworkable. TFL informs me that pedestrian flows after the pedestrianisation of the northern part of Trafalgar square are rooted in road safety.
  All the points made on both new clauses were germane and fair. I may agree with some but not with others. The right hon. Member for Wokingham (Mr. Redwood) was ahead of me when he said that such matters are for local determination, not for the Bill in the first instance. New clause 5 seeks to extend the network management duties of local traffic authorities to the monitoring of all traffic lights in their areas?but ensuring that traffic light sets are working correctly to achieve the expeditious movement of all traffic would be one strand of a local traffic authority's management traffic duties, as set out in clause 16.
  The term "traffic" explicitly includes pedestrian. We had that debate at length in Committee. Considering expeditious traffic flows in the context of traffic lights purely in isolation is not sufficient; that is a fundamental flaw in both new clauses. Traffic flows must be viewed in the wider context of the network management duties that permeate the entire Bill
  At first, I inadvertently misled the Committee. I was still in pre-Greater London Authority mode when I stated that the transport operational command unit managed traffic lights in London—which it did before the GLA. Subsequently, that duty fell to TFL. I am grateful to the hon. Member for Christchurch for allowing me to correct that error.
  New clause 5 would place a requirement on traffic authorities to ensure that all traffic lights be at optimum settings at all times during which they are operational. No one would disagree with that general objective, but we dispute the means. The majority of traffic lights in the

  235
  UK are responsive to traffic flow changes and allocate green times proportionately to vehicle flow and the needs of pedestrians. Lights can also have different settings to cater for rush hour and non-rush hour periods, to achieve the expeditious and safe passage of vehicular and pedestrian traffic. We will include advice in the guidance on network management techniques that will be issued under clause 18, so there is no need to incorporate that requirement in the Bill.
  There is mixed experience from America. I can say from my 18 months in America, principally as a student, that for every four-way flashing amber junction there are about 10 four-way stop junctions with no lights. That practice is rooted in America's highway culture, especially in urban areas. They eschew the need for roundabouts, and although there are examples of fourway-flashing amber junctions—to which I will return in moment—it must be pointed out that that is not the only model used, as four-way stops are a far more regular occurrence in those areas.
  Furthermore, the new clause would make it a requirement that during non-rush-hour times traffic lights should operate on flashing amber warning mode at traffic junctions with low traffic volumes. As I think we said in relation to the wider context of traffic lights—not specifically on flashing amber warning mode—that proposal would seriously compromise vehicular and pedestrian safety, and it must be discussed in the context of pedestrians and their safety as well as that of vehicular flow. Flashing amber already has a specific meaning at pelican crossings—that a driver may proceed if no pedestrians are crossing—and such an amendment would cause danger and confusion if it had another meaning at a junction. Flashing amber would not in any case be suitable at many junctions where buildings or road layout prevent drivers from seeing whether other vehicles are approaching the junction.
  As for pedestrians, although I cheerfully admit that the right hon. Member for Wokingham is fit, active and sprightly, not every pedestrian in a London context, or any other context, is, and we must legislate for safety for all, from the fittest to the most vulnerable, in terms of road safety. Pedestrians, especially the most vulnerable, will have no crossing facilities and will find crossing the road neither convenient nor safe at non-rush-hour times. As I am sure I said in Committee, blind and partially sighted pedestrians would no longer be able to rely on audible and tactile signals to cross safely, as flashing amber would necessitate removal of those facilities. It would be contrary to long-established UK practice, and unsafe, to signal pedestrians to cross when there are conflicting traffic movements. A better solution is to ensure that signals operate, wherever possible, in a responsive way so that drivers are only stopped when there is a conflict with other vehicle or pedestrian movements. At quiet times, signals need only operate to stop traffic if a pedestrian has operated the push button. I repeat, however, that all this needs to be seen—as we said constantly in Committee—in the wider context of the balance between pedestrians, safety considerations, vehicular flows and road traffic. Isolating this aspect will ultimately undermine the essence of the network management duty.
  236
  New clause 8 has been described as similar to new clause 5, but it omits—to be fair to it—the dangerous proposal that traffic lights should operate in flashing amber mode in all directions at traffic lights with low volumes of traffic during non-rush hour periods. The new clause proposes that traffic lights give longer green phases to main roads than to side roads and continuous green phases to main roads during quiet times of day and night, except where the traffic sensors recognise traffic on approaching side roads. That is essentially a description of how responsive traffic lights should operate in most situations, and it is generally what we want to happen in practice.
  I repeat that I am not condemning right hon. and hon. Members on the Conservative Benches for the substance of what they suggest. Many of these things should be a matter of course in terms of achieving the network management duty, and should be reflected in the guidance indicated in the relevant clause—18, I think. As I said, however, it is an area best suited to guidance, not legislation, as local authorities are best placed to determine the operation of traffic lights in the light of local conditions, as I believe the right hon. Member for Wokingham was suggesting that his authority is now doing.
  The proposal would, for example, prevent authorities from installing traffic light systems that revert to all-red in the absence of any demands, for example, late at night. In many instances, despite the complete aversion to all-red phases of the right hon. Member for Wokingham. they assist traffic flow— when they are traffic sensitive, they change as soon as a vehicle approaches, and they can do so within seconds. The balance must be struck in relation to starting at an all-red phase. In the context of road safety, therefore, if a pedestrian comes along, they can cross safety and take preference. It is therefore not always the case that all-red phases are counter to the needs, desires, freedoms—or whatever else one wants to suggest—of the motorist.
  5.30 pm
  This type of system has been successful in reducing the incidence of certain kinds of accident, and is also very responsive when the first demand is received, whether from a vehicle or from a pedestrian. Where suitable, it enables whoever arrives at the lights first— motorist or pedestrian—to receive the fastest possible response.
  The new clause would also have the immediate effect of making fixed-time systems unlawful during non-rush hour periods, including systems with varying times depending on the time of day. Local authorities with vehicle-activated traffic light systems could also be in breach of the provision if the vehicle detectors failed during non-rush hour periods, because such systems are designed to revert to fixed-time operation.
  I am happy for the substance of the new clause to be discussed in more detail when we consider techniques relating to network management. As for a point that is not part of the substance but was raised in Committee, the ability to turn left at red lights—I see that being done

  237
  successfully all the time when I am in France during the summer, and also in America, although of course those are right-hand turns—may have some merit at some junctions. Giving carte blanche at all junctions, however, could conflict with prevailing road safety systems.
  Given the assurance that the substance of the new clauses—but not the four-way flashing amber phase—may be worthy of consideration, and the assurance that the network management duty and associated guidance will cover traffic light operation, I hope that, in the spirit of what has been a wonderful debate so far, Members will not press them to the vote following an extremely generous and forbearing double act on the Government Front Bench.
  Mr. Greg Knight: What a contrast between the two Ministers! The hon. Member for Plymouth, Devonport (Mr. Jamieson) listened to, and accepted, most of our arguments. The hon. Member for Harrow, East (Mr. McNulty) tried to get in on his hon. Friend's coat tails by pretending that he was Mr. Reasonable as well. He is not. He appeared still wearing his Government Whip's uniform, and I am afraid that merely saying that some of our points may be worthy of consideration is not good enough. We wanted him to give a commitment that he would look at our proposals as a matter of urgency. Of course we accept that just changing one traffic light will not solve the problem, but what we need is guidance that those who set the timing of the lights are obliged to follow, the intention being to improve traffic flows.
  Mr. Redwood: The facts are simple. Before the lighting phases were changed, the traffic flowed well; as soon as they were changed, it did not. If the Minister is right in saying that other traffic lights are gummed up as well, we are not stopping him from changing them all—but he must change the really difficult one, which is the one identified by my right hon. Friend.
  Mr. Knight: My right hon. Friend is correct, and we have heard no realistic indication from the Minister today that he appreciates the scale of the problem, or is willing to grasp it. I realise that in a moment he will probably look over his shoulder expecting salvation from his troops in the approaching Division, but let me tell him that there is a bigger army out there—an army of angry, over-taxed motorists sitting in congested queues of traffic that need not exist. It is that army, which is bigger than his parliamentary army, that will sweep this Government from office in 2005.
  I wish to test the mood of the House.
  Question put, That the clause be read a Second time:—
  The House divided: Ayes 167, Noes 279.
  Division No. 91]
  [5:33 pm

  AYES

  Allan, Richard

  Bellingham, Henry

  Amess, David

  Blunt, Crispin

  Atkinson, Peter (Hexham)

  Boswell, Tim

  Bacon, Richard

  Bottomley, Peter (Worthing W)

  Baldry, Tony

  Brake, Tom (Carshalton)

  Baron, John (Billericay)

  Brazier, Julian

  Barrett, John

  Breed, Colin

  238

  Brooke, Mrs Annette L.

  Kirkwood, Sir Archy

  Browning, Mrs Angela

  Knight, rh Greg (E Yorkshire)

  Bruce, Malcolm

  Laing, Mrs Eleanor

  Burns, Simon

  Lait, Mrs Jacqui

  Burstow, Paul

  Lamb, Norman

  Burt, Alistair

  Lansley, Andrew

  Butterfill, Sir John

  Leigh, Edward

  Cameron, David

  Lewis, Dr. Julian (New Forest E)

  Campbell, rh Sir Menzies (NE Fife)

  Liddell-Grainger, Ian

  Lidington, David

  Cash, William

  Lilley, rh Peter

  Chapman, Sir Sydney (Chipping Barnet)

  Llwyd, Elfyn

  Loughton, Tim

  Chidgey, David

  Luff, Peter (M-Worcs)

  Chope, Christopher

  McIntosh, Miss Anne

  Clappison, James

  Mackay, rh Andrew

  Clarke, rh Kenneth (Rushcliffe)

  McLoughlin, Patrick

  Collins, Tim

  Maples, John

  Conway, Derek

  Marsden, Paul (Shrewsbury & Atcham)

  Cormack, Sir Patrick

  Cotter, Brian

  Maude, rh Francis

  Cran, James (Beverley)

  Mawhinney, rh Sir Brian

  Curry, rh David

  Mercer, Patrick

  Davey, Edward (Kingston)

  Mitchell, Andrew (Sutton Coldfield)

  Davies, Quentin (Grantham & Stamford)

  Moore, Michael

  Dorrell, rh Stephen

  Moss, Malcolm

  Doughty, Sue

  Murrison, Dr. Andrew

  Duncan Smith, rh lain

  Norman, Archie

  Fabricant, Michael

  Oaten, Mark (Winchester)

  Fallon, Michael

  O'Brien, Stephen (Eddisbury)

  Field, Mark (Cities of London & Westminster)

  &#x00D6;pik, Lembit

  Osborne, George (Tatton)

  Flight, Howard

  Ottaway, Richard

  Flook, Adrian

  Page, Richard

  Forth, rh Eric

  Paterson, Owen

  Foster, Don (Bath)

  Pickles, Eric

  Francois, Mark

  Prisk, Mark (Hertford)

  Gale, Roger (N Thanet)

  Pugh, Dr. John

  Garnier, Edward

  Randall, John

  George, Andrew (St. Ives)

  Redwood, rh John

  Gidley, Sandra

  Reid, Alan (Argyll & Bute)

  Gillan, Mrs Cheryl

  Rendel, David

  Goodman, Paul

  Robertson, Hugh (Faversham & M-kent)

  Gray, James (N Wilts)

  Grayling, Chris

  Roe, Mrs Marion

  Green, Damian (Ashford)

  Rosindell, Andrew

  Green, Matthew (Ludlow)

  Russell, Bob (Colchester)

  Greenway, John

  Sanders, Adrian

  Grieve, Dominic

  Shephard, rh Mrs Gillian

  Gummer, rh John

  Shepherd, Richard

  Hague, rh William

  Simpson, Keith (M-Norfolk)

  Hammond, Philip

  Soames, Nicholas

  Hancock, Mike

  Spink, Bob (Castle Point)

  Harris, Dr. Evan (Oxford W & Abingdon)

  Stanley, rh Sir John

  Steen, Anthony

  Harvey, Nick

  Streeter, Gary

  Hawkins, Nick

  Stunell, Andrew

  Hayes, John (S Holland)

  Swayne, Desmond

  Heald, Oliver

  Swire, Hugo (E Devon)

  Heath, David

  Syms, Robert

  Heathcoat-Amory, rh David

  Tapsell, Sir Peter

  Hendry, Charles

  Taylor, John (So//hull)

  Hermon, Lady

  Taylor, Matthew (Truro)

  Hoban, Mark (Fareham)

  Taylor, Sir Teddy

  Holmes, Paul

  Thurso, John

  Horam, John (Orpington)

  Tonge, Dr. Jenny

  Howarth, Gerald (Aldershot)

  Tredinnick, David

  Jack, rh Michael

  Trend, Michael

  Jackson, Robert (Wantage)

  Turner, Andrew (Isle of Wight)

  Jenkin, Bernard

  Tyler, Paul (N Cornwall)

  Keetch, Paul

  Tyrie, Andrew

  Kennedy, rh Charles (Ross Skye & Inverness)

  Viggers, Peter

  Walter, Robert

  Key, Robert (Salisbury)

  Waterson, Nigel

  Kirkbride, Miss Julie

  Watkinson, Angela

  239

  Webb, Steve (Northavon)

  Winterton, Sir Nicholas(Macclesfield)

  Whittingdale, John

  Wiggin, Bill

  Young, rh Sir George

  Williams, Roger (Brecon)

  Younger-Ross, Richard

  Willis, Phil

  Tellers for the Ayes:

  Wilshire, David

  Mr. David Ruffley and

  Winterton, Ann (Congleton)

  Mr. Geoffrey Clifton-Brown

  NOES

  Abbott, Ms Diane

  Davies, Geraint (Croydon C)

  Ainger, Nick

  Dawson, Hilton

  Ainsworth, Bob (Cov'try NE)

  Dean, Mrs Janet

  Allen, Graham

  Denham, rh John

  Anderson, rh Donald (Swansea E)

  Dhanda, Parmjit

  Armstrong, rh Ms Hilary

  Dismore, Andrew

  Atherton, Ms Candy

  Dobbin, Jim (Heywood)

  Atkins, Charlotte

  Donohoe, Brian H.

  Austin, John

  Doran, Frank

  Bailey, Adrian

  Dowd, Jim (Lewisham W)

  Baird, Vera

  Drew, David (Stroud)

  Banks, Tony

  Dunwoody, Mrs Gwyneth

  Barnes, Harry

  Eagle, Maria (L'pool Garston)

  Battle, John

  Edwards, Huw

  Bayley, Hugh

  Ellman, Mrs Louise

  Bell, Sir Stuart

  Etherington, Bill

  Bennett, Andrew

  Farrelly, Paul

  Best, Harold

  Field, rh Frank (Birkenhead)

  Blackman, Liz

  Fisher, Mark

  Blizzard, Bob

  Fitzpatrick, Jim

  Borrow, David

  Fitzsimons, Mrs Lorna

  Bradley, rh Keith (Withington)

  Flint Caroline

  Bradley, Peter (The Wrekin)

  Flynn, Paul (Newport W)

  Bradshaw, Ben

  Follett, Barbara

  Brennan, Kevin

  Foster, rh Derek

  Brown, Russell (Dumfries)

  Foster, Michael (Worcester)

  Buck, Ms Karen

  Foster, Michael Jabez (Hastings & Rye)

  Burnham, Andy

  Byers, rh Stephen

  Foulkes, rh George

  Cairns, David

  Francis, Dr. Hywel

  Campbell, Alan (Tynemouth)

  Gardiner, Barry

  Campbell, Ronnie (Blyth V)

  George, rh Bruce (Walsall S)

  Caplin, Ivor

  Gerrard, Neil

  Caton, Martin

  Gilroy, Linda

  Cawsey, Ian (Brigg)

  Godsiff, Roger

  Chapman, Ben (Wirral S)

  Goggins, Paul

  Clark, Mrs Helen (Peterborough)

  Griffiths, Nigel (Edinburgh S)

  Clark, Dr. Lynda (Edinburgh Pentlands)

  Griffiths, Win (Bridgend)

  Grogan, John

  Clark, Paul (Gillingham)

  Hain, rh Peter

  Clarke, rh Tom (Coatbridge & Chryston)

  Hall, Mike (Weaver Vale)

  Hall, Patrick (Bedford)

  Clelland, David

  Hanson, David

  Coffey, Ms Ann

  Havard, Dai (Merthyr Tydfil & Rhymney)

  Coleman, lain

  Colman, Tony

  Henderson, Ivan (Harwich)

  Connarty, Michael

  Hepburn, Stephen

  Cook, Frank (Stockton N)

  Heppell, John

  Cooper, Yvette

  Hesford, Stephen

  Corbyn, Jeremy

  Heyes, David

  Corston, Jean

  Hinchliffe, David

  Cousins, Jim

  Hodge, Margaret

  Cox, Tom (Tooting)

  Hoey, Kate (Vauxhall)

  Cranston, Ross

  Hope, Phil (Corby)

  Crausby, David

  Hopkins, Kelvin

  Cruddas, Jon

  Howarth, George (Knowsley N & Sefton E)

  Cryer, John (Hornchurch)

  Cunningham, Jim (Coventry S)

  Howells, Dr. Kim

  Cunningham, Tony (Workington)

  Hughes, Beverley (Stretford & Urmston)

  Curtis-Thomas, Mrs Claire

  Dalyell, Tam

  Hughes, Kevin (Doncaster N)

  Darling, rh Alistair

  Humble, Mrs Joan

  Davey, Valerie (Bristol W)

  Hurst, Alan (Braintree)

  David, Wayne

  Hutton, rh John

  Davidson, Ian

  Iddon, Dr. Brian

  Davies, rh Denzil (Llanelli)

  Illsley, Eric

  240

  Ingram, rh Adam

  Palmer, Dr. Nick

  Jackson, Glenda (Hampstead & Highgate)

  Pearson, Ian

  Pickthall, Colin

  Jackson, Helen (Hillsborough)

  Plaskitt, James

  Jamieson, David

  Pollard, Kerry

  Jenkins, Brian

  Pond, Chris (Gravesham)

  Johnson, Miss Melanie (Welwyn Hatfield)

  Pope, Greg (Hyndburn)

  Prentice, Ms Bridget (Lewisham E

  Jones, Helen (Warrington N)

  Jones, Kevan (N Durham)

  Prentice, Gordon (Pendle)

  Jones, Lynne (Selly Oak)

  Prescott, rh John

  Jones, Martyn (Clwyd S)

  Prosser, Gwyn

  Kaufman, rh Gerald

  Purchase, Ken

  Keeble, Ms Sally

  Purnell, James

  Keen, Alan (Feltham)

  Quinn, Lawrie

  Kelly, Ruth (Bolton W)

  Rammell, Bill

  Khabra, Piara S.

  Rapson, Syd (Portsmouth N)

  Kidney, David

  Raynsford, rh Nick

  Kilfoyle, Peter

  Reed, Andy (Loughborough)

  King, Ms Oona (Bethnal Green & Bow)

  Robertson, John (Glasgow Anniesland)

  Knight, Jim (S Dorset)

  Robinson, Geoffrey (Coventry NW)

  Kumar, Dr. Ashok

  Ladyman, Dr. Stephen

  Roche, Mrs Barbara

  Lammy, David

  Ross, Ernie (Dundee W)

  Lawrence, Mrs Jackie

  Roy, Frank (Motherwell)

  Laxton, Bob (Derby N)

  Ruane, Chris

  Lazarowicz, Mark

  Russell, Ms Christine (City of Chester)

  Lepper, David

  Leslie, Christopher

  Ryan, Joan (Enfield N)

  Lewis, Terry (Worsley)

  Sarwar, Mohammad

  Liddell, rh Mrs Helen

  Savidge, Malcolm

  Linton, Martin

  Sawford, Phil

  Love, Andrew

  Sedgemore, Brian

  Lucas, Ian (Wrexham)

  Shaw, Jonathan

  McAvoy, Thomas

  Sheerman, Barry

  McCabe, Stephen

  Sheridan, Jim

  McCafferty, Chris

  Short, rh Clare

  McCartney, rh Ian

  Simpson, Alan (Nottingham S)

  McDonagh, Siobhain

  Skinner, Dennis

  MacDonald, Calum

  Smith, rh Andrew (Oxford E)

  McDonnell, John

  Smith, Geraldine (Morecambe & Lunesdale)

  Mclsaac, Shona

  Mackinlay, Andrew

  Smith, Jacqui (Redditch)

  McNulty, Tony

  Smith, John (Glamorgan)

  Mactaggart, Fiona

  Smith, Llew (Blaenau Gwent)

  McWalter, Tony

  Soley, Clive

  McWilliam, John

  Squire, Rachel

  Mahon, Mrs Alice

  Starkey, Dr. Phyllis

  Mann, John (Bassetlaw)

  Steinberg, Gerry

  Marris, Rob (Wolverh'ton SW)

  Stevenson, George

  Marsden, Gordon (Blackpool S)

  Stinchcombe, Paul

  Marshall, David (Glasgow Shettleston)

  Strang, rh Dr. Gavin

  Stuart, Ms Gisela

  Marshall, Jim (Leicester S)

  Sutcliffe, Gerry

  Martlew, Eric

  Taylor, Dan (Stockton S)

  Merron, Gillian

  Taylor, David (NW Leics)

  Miliband, David

  Taylor, Dr. Richard (Wyre F)

  Miller, Andrew

  Thomas, Gareth (Clwyd W)

  Mitchell, Austin (Gt Grimsby)

  Thomas, Gareth (Harrow W)

  Moffatt, Laura

  Timms, Stephen

  Mole, Chris

  Todd, Mark (S Derbyshire)

  Moonie, Dr. Lewis

  Touhig, Don (Islwyn)

  Moran, Margaret

  Trickett, Jon

  Morgan, Julie

  Truswell, Paul

  Morley, Elliot

  Turner, Dennis (Wolverh'ton SE)

  Mountford, Kali

  Turner, Neil (Wigan)

  Mudie, George

  Twigg, Derek (Halton)

  Mullin, Chris

  Tynan, Bill (Hamilton S)

  Murphy, Denis (Wansbeck)

  Vaz, Keith (Leicester E)

  Naysmith, Dr. Doug

  Vis, Dr. Rudi

  Norris, Dan (Wansdyke)

  Ward, Claire

  O'Hara, Edward

  Wareing, Robert N.

  Olner, Bill

  Watson, Tom (W Bromwich E)

  Organ, Diana

  Watts, David

  Owen, Albert

  White, Brian

  241

  Whitehead, Dr. Alan

  Woolas, Phil

  Wicks, Malcolm

  Worthington, Tony

  Wills Michael

  Wright, Tony (Cannock)

  Winnick, David

  Wyatt, Derek

  Winterton, Ms Rosie (Doncaster C)

  Tellers for the Noes:

  Mr. Fraser Kemp and

  Woodward, Shaun

  Vernon Coaker

  Question accordingly negatived.

Clause 9

  REMOVAL OF CERTAIN VEHICLES BY TRAFFIC OFFICERS
  Mr. Chope: I beg to move amendment No. 2, in page 5, line 19, at end insert—
  (3) When exercising any powers made under provisions referred to in subsection (1), and before arranging for the removal of a broken-down vehicle, a traffic officer shall, when this can be done without compromising safety or unreasonably impeding traffic-flow&#x2014;

  grant the driver of the vehicle, where present, a reasonable opportunity to contact a breakdown organisation or other service provider of their choice, and if that organisation confirms to the traffic officer that it will attend the broken-down vehicle as soon as practicable, then the traffic officer shall allow that organisation a reasonable period in which to attend the aforesaid vehicle; or

  (b) where the driver of the broken-down vehicle is not a member of a breakdown organisation, take into account any wishes of the driver with regard to attendance on the relevant vehicle and accede to such wishes where this would fulfil the purpose or purposes specified in section 5(3).

  The amendment would prevent up to 10 million customers of the Royal Automobile Club, the AA, Green Flag and other motoring organisations from effectively being short-changed as a result of the changes proposed in part 1 of the Bill. Assurances have been sought from the Government on this issue, with which the Minister is familiar. Ministers made it clear on Second Reading and in Committee that they do not want the result that motoring organisations fear will flow from the Bill. There is one way in which matters can be satisfied, which is for the Minister to accept this amendment.
  The amendment is a modification of what was proposed in Committee. It specifically incorporates the qualification that motoring organisations would not have the right to attend to their customers if, by so doing, they would compromise safety or unreasonably impede traffic flow. In all other circumstances, the customer of a motoring organisation who had broken down on the hard shoulder of a motorway would be able to phone up to call that organisation to attend to his or her needs. The amendment is particularly important for disabled groups and we know that the Disabled Drivers Association strongly supports it.
  Mr. David Kidney: Briefly, I spoke on Second Reading in support of co-operation between the Highways Agency and recovery operators of the sort that currently obtains between the police and those operators. It is disappointing, all these months later, that the necessary talks have still not happened. I have a copy of the memorandum of understanding between
  242
  the Association of Chief Police Officers and the operators, so why on earth can we not now have a tripartite understanding between the police, the Highways Agency and the operators?

  This is an important issue and not just because 90 per cent. of the activity is already carried out by the operators. It would be iniquitous if all the people who were members of motoring organisations were denied the use of those operators' services. The Minister would become unpopular if people started getting bigger bills for the removal of their vehicles from the motorway roadside than they would if their operator had turned up.
  A constituent recently contacted me about his experiences. It was not a motorway case, but the Minister may be interested to know that the Highways Agency arranged for a private operator to turn up and remove a little bit of oil from the road, for which my constituent was charged £600. The Highways Agency will lose control over the costs. How much better if there were co-operation between the Highways Agency and the operators who have the skills and abilities to work with that agency on a collaborative basis. That would be more efficient, more time-saving and certainly less costly.
  Mr. Redwood: I rise to support my hon. Friend on his important amendment. I find it extraordinary that the Government want to do so much damage to well established motoring organisations such as the Royal Automobile Club and the Automobile Association, and to deny motorists their choice and opportunity—[Interruption.] The Minister protests, but he has only to read the reasonable words of the amendment, which make it clear that we wish to
  grant the driver of the vehicle, where present, a reasonable opportunity to contact a breakdown organisation or other service provider of their choice.
  Why does the Minister object to that, which seems such a reasonable thing to do? If he does object, as seems to be the case, I presume that, if we had enough time left, he would recommend that his hon. Friends voted the amendment down. That must mean that he has no time for the AA and the RAC, and that he would like them to be displaced by the expensive monopoly proposals in the Bill.
  I do hope that the Minister will think again. I shall not develop my argument further, because I want to hear his reply in the hope that, even at this last moment, he might have seen the folly of his ways and grant us leave to add the amendment to the Bill.
  Brian White: One of the reasons provided by several organisations to explain their concerns is their fear of a change of Government. I would certainly endorse that. The real danger with the Bill is that we end up with a Tory Government. I wholly concur, and any sensible person would also be fearful of that possibility.
  There remain some genuine concerns about the need to ensure that the breakdown companies remain competitive, and that there is a national competitive framework governing the operation of the various providers. There is concern that the Bill's reasonable provisions are not so open-ended as they appear. The discussions need to be brought to a conclusion. I believe

  243
  that the memorandum of understanding should become tripartite and that that should happen as quickly as possible. The Government should reiterate the assurances that the breakdown industry is seeking.
  Mr. Jamieson: Again, these issues were rehearsed at length in Standing Committee. In case there is no time later, I want to make it clear that this Government hold this country's recovery organisations in high regard. The AA, RAC and Green Flag, to name but three, give their members an excellent service. The Government have absolutely no intention of supplanting the excellent work of those organisations. I hope that that reassures the Opposition, who seem hellbent on perpetuating a myth about the Government's intentions.
  Clause 9 paves the way for regulations to be made that will empower traffic officers to remove vehicles that are broken down or abandoned, or parked illegally, obstructively or dangerously. The framework set out in regulations under section 99 of the Road Traffic Regulation Act 1984 already allows the police to remove vehicles in such circumstances. Opposition Members should be aware of that, as the measure was passed by a Conservative Government. The legislation works well, and so we intend to enable traffic officers to deal with the problem in a similar way.
  Vehicles that are broken down, damaged or abandoned represent a safety hazard, especially on motorways and other high-speed roads. They can cause congestion and pose risks to road safety. It is essential that those vehicles can be removed quickly in the interests of the safety of any occupants and of other road users. Motorway hard shoulders and dual carriageway verges are dangerous places, and there are still too many fatalities and serious accidents involving stranded vehicles. It is therefore vital that traffic officers have the ability to require the removal of a stationary vehicle.
  Amendment No. 2 would constrain the ability of traffic officers to sort things out. Over time, those officers become very experienced in assessing such situations, but the amendment would impede their discretion to have a vehicle removed. In practice, that could result in an increasingly dangerous situation: the removal of a vehicle from a hazardous location could be delayed while discussions were held on how long it might take a breakdown organisation to come along, or whether a friend was going to come to the driver's assistance.
  On a busy motorway, with a vehicle in a dangerous position, that would clearly be totally unacceptable. I fully understand the concerns of the recovery organisations and their members that they should not to be subjected to over-zealous removal by the authorities, but that has not happened to date and there is no reason to believe that it will happen in the future.
  Who is in the best position to judge an appropriate course of action? That is a key question. Traffic officers are well trained and experienced professionals who know the network and the prevailing traffic conditions. They will understand more fully the risks inherent in various breakdown situations. They will be at the scene, and also will be in touch with the regional control centres that can provide information relating to
  244
  conditions elsewhere on the road. They are in the best position to make a judgment on the most appropriate course of action, not the driver or the recovery operators.
  I emphasise again that the recovery organisations will be able to attend their members who break down on motorways and trunk roads, as they do now. For those drivers who are not members of a breakdown organisation, the recovery of their vehicles will be dealt with as it is now. That may include the use of police contracts to remove the vehicle from the motorway or trunk road.
  The Government are committed to an ongoing dialogue with the recovery industry to see how further improvements can be made to the way that breakdowns are dealt with on motorways and trunk roads. The Highways Agency is convening a working group to discuss issues of removal and disposal of vehicles, and representatives of the recovery industry will be invited to attend. I am told that the working group will meet next Friday, 26 March, to discuss those matters, and I know for certain that the AA and RAC wish to attend.
  In light of what I have said, I hope that the amendment will be withdrawn.
  Mr. Chope: I will not withdraw the amendment because the Minister has not addressed it—he refers to hazardous situations, which it specifically excludes. Without it, the Highways Agency will be enabled to establish a monopoly roadside recovery service, which is not what anybody wants.
  Question put, That the amendment be made:—
  The House divided: Ayes 174, Noes 276.

  Division No. 92]

  [5:59 pm

  AYES

  Ainsworth, Peter (E Surrey)

  Collins, Tim

  Allan, Richard

  Conway, Derek

  Amess, David

  Cormack, Sir Patrick

  Bacon, Richard

  Cotter, Brian

  Baldry, Tony

  Cran, James (Beverley)

  Barker, Gregory

  Curry, rh David

  Baron, John (Billericay)

  Davey, Edward (Kingston)

  Barrett, John

  Davies, Quentin (Grantham & Stamford)

  Bellingham, Henry

  Blunt, Crispin

  Dorrell, rh Stephen

  Boswell, Tim

  Doughty, Sue

  Bottomley, Peter (Worthing W)

  Fabricant, Michael

  Brake, Tom (Carshalton)

  Fallon, Michael

  Brazier, Julian

  Flight, Howard

  Breed, Colin

  Flook, Adrian

  Brooke, Mrs Annette L.

  Forth, rh Eric

  Browning, Mrs Angela

  Foster, Don (Bath)

  Bruce, Malcolm

  Francois, Mark

  Burns, Simon

  Gale, Roger (N Thanet)

  Burstow, Paul

  Garnier, Edward

  Burt, Alistair

  George, Andrew (St. Ives)

  Butterfill, Sir John

  Gidley, Sandra

  Cameron, David

  Gillan, Mrs Cheryl

  Campbell, Gregory (E Lond'y)

  Goodman, Paul

  Campbell, rh Sir Menzies (NE Fife

  Gray, James (N Wilts)

  Grayling, Chris

  Cash, William

  Green, Damian (Ashford)

  Chapman, Sir Sydney (Chipping Barnet)

  Green, Matthew (Ludlow)

  Grieve, Dominic

  Chope, Christopher

  Gummer, rh John

  Clappison, James

  Hague, rh William

  Clarke, rh Kenneth (Rushcliffe)

  Hammond, Philip

  245

  Hancock, Mike

  Portillo, rh Michael

  Harris, Dr. Evan (Oxford W & Abingdon)

  Price, Adam (E Carmarthen & Dinefwr)

  Harvey, Nick

  Prisk, Mark (Hertford)

  Hawkins, Nick

  Pugh, Dr. John

  Hayes, John (S Holland)

  Randall, John

  Heald, Oliver

  Redwood, rh John

  Heath, David

  Reid, Alan (Argyll & Bute)

  Heathcoat-Amory, rh David

  Rendel, David

  Hendry, Charles

  Robertson, Hugh (Faversham & M-Kent)

  Hermon, Lady

  Hoban, Mark (Fareham)

  Robinson, Mrs Iris (Strangford)

  Holmes, Paul

  Roe, Mrs Marion

  Horam, John (Orpington)

  Rosindell, Andrew

  Howarth, Gerald (Aldershot)

  Ruffley. David

  Hunter, Andrew

  Russell, Bob (Colchester)

  Jack, rh Michael

  Sanders, Adrian

  Jackson, Robert (Wantage)

  Shepherd, rh Mrs Gillian

  Jenkin, Bernard

  Shepherd, Richard

  Keetch, Paul

  Simpson, Keith (M-Norfolk)

  Kennedy, rh Charles (Ross Skye & Inverness)

  Soames, Nicholas

  Spink, Bob (Castle Point)

  Key, Robert (Salisbury)

  Stanley, rh Sir John

  Kirkbride, Miss Julie

  Steen, Anthony

  Kirkwood, Sir Archy

  Streeter, Gary

  Knight, rh Greg (E Yorkshire)

  Stunell, Andrew

  Laing, Mrs Eleanor

  Swayne, Desmond

  Lait, Mrs Jacqui

  Swire, Hugo (E Devon)

  Lamb, Norman

  Syms, Robert

  Lansley, Andrew

  Tapsell, Sir Peter

  Laws David , (Yeovil)

  Taylor, John (Solihull)

  Leigh , Edward

  Taylor, Matthew (Truro)

  Lewis, Dr. Julian (New Forest E)

  Taylor, Sir Teddy

  Liddell-Grainger, Ian

  Teather, Sarah

  Lidington , David

  Thomas, Simon (Ceredigion)

  Lilley, rh Peter

  Thurso, John

  Llwyd , Elfyn

  Tonge, Dr. Jenny

  Loughton Tim

  Tredinnick, David

  Luff, Peter (M-Worcs)

  Trend, Michael

  Turner, Andrew (Isle of Wight)

  McIntosh, Miss Anne

  Tyler, Paul (N Cornwall)

  Mackay, rh Andrew

  Tyrie, Andrew

  Maclean, rh David

  Viggers, Peter

  McLoughlin, Patrick

  Walter, Robert

  Maples, John

  Waterson, Nigel

  Marsden, Paul (Shrewsbury & Atcham)

  Watkinson, Angela

  Webb, Steve (Northavon)

  Maude, rh Francis

  Whittingdale, John

  Mawhinney, rh Sir Brian

  Widdecombe, rh Miss Ann

  May, Mrs Theresa

  Wiggin, Bill

  Mitchell, Andrew (Sutton Coldfield)

  Williams, Roger (Brecon)

  Willis, Phil

  Moore, Michael

  Wilshire, David

  Moss, Malcolm

  Winterton, Ann (Congleton)

  Murrison, Dr. Andrew

  Winterton, Sir Nicholas (Macclesfield)

  Norman, Archie

  O'Brien, Stephen (Eddisbury)

  Young, rh Sir George

  &#x00D6;pik, Lembit

  Younger-Ross, Richard

  Osborne, George (Tatton)

  Ottaway, Richard

  Tellers for the Ayes:

  Page, Richard

  Mr. Geoffrey Clifton-Brown and

  Paterson, Owen

  Pickles, Eric

  Mr. Peter Atkinson

  NOES

  Abbott, Ms Diane

  Banks, Tony

  Ainger, Nick

  Barnes, Harry

  Ainsworth, Bob (Cov'try NE)

  Battle, John

  Allen, Graham

  Bayley, Hugh

  Anderson, rh Donald (Swansea E)

  Bell, Sir Stuart

  Armstrong, rh Ms Hilary

  Bennett, Andrew

  Atherton, Ms Candy

  Best, Harold

  Atkins, Charlotte

  Blackman, Liz

  Austin, John

  Blears, Ms Hazel

  Bailey, Adrian

  Blizzard, Bob

  Baird, Vera

  Borrow, David

  246

  Bradley, rh Keith (Withington)

  Griffiths, Win (Bridgend)

  Bradley, Peter (The Wrekin)

  Grogan, John

  Bradshaw, Ben

  Hain, rh Peter

  Brennan, Kevin

  Hall, Mike (Weaver Vale)

  Buck, Ms Karen

  Hall, Patrick (Bedford)

  Burnham, Andy

  Hanson, David

  Byers, rh Stephen

  Havard, Dai (Merthyr Tydfil & Rhymney

  Cairns, David

  Campbell, Alan (Tynemouth)

  Healey, John

  Campbell, Ronnie (Blyth V)

  Henderson, Ivan (Harwich)

  Caplin, Ivor

  Hepburn, Stephen

  Caton, Martin

  Heppell, John

  Cawsey, Ian (Brigg)

  Hesford, Stephen

  Challen, Colin

  Heyes, David

  Chapman, Ben (Wirral S)

  Hinchliffe, David

  Chaytor, David

  Hoey, Kate (Vauxhall)

  Clark, Mrs Helen (Peterborough)

  Hope, Phil (Corby)

  Clark, Dr. Lynda (Edinburgh Pentlands)

  Hopkins, Kelvin

  Howarth, George (Knowsley N & Sefton E)

  Clarke, rh Tom (Coatbridge & Chryston)

  Hughes, Kevin (Doncaster N)

  Clelland, David

  Humble, Mrs Joan

  Coleman, lain

  Hurst, Alan (Braintree)

  Connarty, Michael

  Hutton, rh John

  Cook, Frank (Stockton N)

  Iddon, Dr. Brian

  Cooper, Yvette

  Illsley, Eric

  Corbyn, Jeremy

  Jackson, Glenda (Hampstead & Highgate)

  Corston, Jean

  Cousins, Jim

  Jackson. Helen (Hillsborough)

  Cox, Tom (Tooting)

  Jamieson, David

  Cranston, Ross

  Jenkins, Brian

  Crausby, David

  Johnson, Miss Melanie (Welwyn Hatfield)

  Cruddas, Jon

  Cryer, John (Hornchurch)

  Jones, Helen (Warrington N)

  Cunningham, Jim (Coventry S)

  Jones, Kevan (N Durham)

  Cunningham, Tony (Workington)

  Jones, Lynne (Selly Oak)

  Curtis-Thomas, Mrs Claire

  Jones, Martyn (Clwyd S)

  Dalyell, Tam

  Kaufman, rh Gerald

  Davey, Valerie (Bristol W)

  Keeble, Ms Sally

  David, Wayne

  Keen, Alan (Feltham)

  Davidson, Ian

  Keen, Ann (Brentford)

  Davies, rh Denzil (Llanelli)

  Kemp, Fraser

  Davies, Geraint (Croydon C)

  Khabra, Piara S.

  Dawson, Hilton

  Kidney, David

  Dean, Mrs Janet

  Kilfoyle, Peter

  Denham, rh John

  King, Ms Oona (Bethnal Green & Bow

  Dhanda, Parmjit

  Dismore, Andrew

  Knight Jim (S Dorset)

  Dobbin, Jim (Heywood)

  Kumar, Dr. Ashok

  Doran, Frank

  Ladyman, Dr. Stephen

  Dowd, Jim (Lewisham W)

  Lammy, David

  Drew, David (Stroud)

  Lawrence, Mrs Jackie

  Dunwoody, Mrs Gwyneth

  Laxton, Bob (Derby N)

  Eagle, Maria (L'pool Garston)

  Lazarowicz, Mark

  Edwards, Huw

  Lepper, David

  Etherington, Bill

  Leslie, Christopher

  Farrelly, Paul

  Lewis, Terry (Worsley)

  Field, rh Frank (Birkenhead)

  Liddell, rh Mrs Helen

  Fisher, Mark

  Linton, Martin

  Fitzpatrick, Jim

  Love, Andrew

  Fitzsimons, Mrs Lorna

  Lucas, Ian (Wrexham)

  Flint Caroline

  McAvoy, Thomas

  Flynn, Paul (Newport W)

  McCabe, Stephen

  Follett, Barbara

  McCafferty, Chris

  Foster, rh Derek

  McCartney, rh Ian

  Foster, Michael (Worcester)

  McDonagh, Siobhain

  Foster, Michael Jabez (Hastings & Rye)

  MacDonald, Calum

  McDonnell, John

  Foulkes, rh George

  McFall, John

  Francis, Dr. Hywel

  Mclsaac, Shona

  Gardiner, Barry

  Mackinlay, Andrew

  George, rh Bruce (Walsall S)

  McNulty, Tony

  Gerrard, Neil

  Mactaggart, Fiona

  Gilroy, Linda

  McWalter, Tony

  Godsiff, Roger

  McWilliam, John

  Griffiths, Nigel (Edinburgh S)

  Mahon, Mrs Alice

  247

  Mann, John (Bassetlaw)

  Shaw, Jonathan

  Marris, Rob (Wolverh'ton SW)

  Sheerman, Barry

  Marsden, Gordon (Blackpool S)

  Sheridan, Jim

  Marshall, David (Glasgow Shettleston)

  Short, rh Clare

  Simpson, Alan (Nottingham S)

  Marshall, Jim (Leicester S)

  Singh, Marsha

  Martlew, Eric

  Skinner, Dennis

  Merron, Gillian

  Smith, rh Andrew (Oxford E)

  Michael, rh Alun

  Smith, rh Chris (Islington S & Finsbury)

  Miliband, David

  Miller, Andrew

  Smith, Geraldine (Morecambe &amp Lunesdale)

  Mitchell, Austin (Gt Grimsby)

  Moffatt, Laura

  Smith, Jacqui (Redditch)

  Mole, Chris

  Smith, John (Glamorgan)

  Moonie, Dr. Lewis

  Smith, Llew (Blaenau Gwent)

  Moran, Margaret

  Soley, Clive

  Morgan, Julie

  Squire, Rachel

  Morley, Elliot

  Starkey, Dr. Phyllis

  Mountford, Kali

  Steinberg, Gerry

  Mudie, George

  Stevenson, George

  Mullin, Chris

  Stinchcombe, Paul

  Murphy, Denis (Wansbeck)

  Stoate, Dr. Howard

  Naysmith, Dr. Doug

  Strang, rh Dr. Gavin

  Norris, Dan (Wansdyke)

  Stuart, Ms Gisela

  O'Hara, Edward

  Sutcliffe, Gerry

  Diner, Bill

  Taylor, Dan (Stockton S)

  Organ, Diana

  Taylor, David (NW Leics)

  Owen, Albert

  Taylor, Dr. Richard (Wyre F)

  Palmer, Dr. Nick

  Thomas, Gareth (Clwyd W)

  Pearson, Ian

  Thomas, Gareth (Harrow W)

  Pickthall, Colin

  Todd, Mark (S Derbyshire)

  Plaskitt, James

  Touhig, Don (Islwyn)

  Pollard, Kerry

  Trickett, Jon

  Pond, Chris (Gravesham)

  Truswell, Paul

  Pope, Greg (Hyndburn)

  Turner, Dennis (Wolverh'ton SE)

  Prentice, Ms Bridget (Lewisham E)

  Turner, Neil (Wigan)

  Twigg, Derek (Halton)

  Prentice, Gordon (Pendle)

  Tynan, Bill (Hamilton S)

  Prosser, Gwyn

  Vaz, Keith (Leicester E)

  Purchase, Ken

  Vis, Dr. Rudi

  Purnell, James

  Ward, Claire

  Quinn, Lawrie

  Wareing, Robert N.

  Rammell, Bill

  Watson, Tom (W Bromwich E)

  Rapson, Syd (Portsmouth N)

  Watts, David

  Reed, Andy (Loughborough)

  White, Brian

  Robertson, John (Glasgow Anniesland)

  Whitehead, Dr. Alan

  Wicks, Malcolm

  Robinson, Geoffrey (Coventry NW)

  Wills, Michael

  Winnick, David

  Roche, Mrs Barbara

  Winterton, Ms Rosie (Doncaster C))

  Rooney, Terry

  Ross, Ernie (Dundee W)

  Woodward, Shaun

  Roy, Frank (Motherwell)

  Woolas, Phil

  Ruane, Chris

  Worthington, Tony

  Russell, Ms Christine (City of Chester)

  Wright, David (Telford)

  Wright Tony (Cannock)

  Ryan, Joan (Enfield N)

  Wyatt, Derek

  Samar, Mohammad

  Savidge, Malcolm

  Tellers for the Noes:

  Sawford, Phil

  Vernon Coaker and

  Sedgemore, Brian

  Paul Clark

  Question accordingly negatived.
  It being after Six o'clock, MR. DEPUTY SPEAKER proceeded to put forthwith the Questions necessary to dispose of the business to be concluded at that hour, pursuant to Order [5 January].

Clause II
  UNIFORM
  Amendment made: No. 3, in page 6, line 12, leave out 'may' and insert 'shall—[Mr. Jamieson.]
Clause 84

  FINANCIAL PROVISIONS
  Amendment made: No. 4, in page 52, line 39, leave out regulations under paragraph 3(3) of'
  and insert
  'an order under Schedule 3 to&#x2014;[Mr. Jamieson.]
  Mr. Deputy Speaker: Consideration completed.Order for Third Reading read.
  6.14 pm
  Mr. Jamieson: I beg to move, That the Bill be now read a Third time.
  I notice that we have three quarters of an hour in which to debate Third Reading, so that might give hon. Members the welcome opportunity to go to the "Taste of Cornwall" exhibition upstairs on the Lower Waiting Hall, which was organised by my hon. Friend the Member for Falmouth and Camborne (Ms Atherton). I enjoyed a lovely oyster and, I must say, a tiny drop of Skinner's Keel Over there. Anyone who wants to taste the fine fare of the west country should take the opportunity to do so.
  Mr. Patrick McLoughlin: On a point of order, Mr. Deputy Speaker. I have just been reflecting on the words that you used at the end of the proceedings on Report. You said, "Consideration completed". I realise that the use of those words is a long established practice, but will you reflect on whether it would be more appropriate to say, "Time allocation completed"? Consideration of these matters has certainly not been completed, because we did not reach many of the amendments. Under the arrangements for the modernisation of the House, the Chair ought to consider not saying "consideration completed" because that is misleading, as the Government's guillotine concluded the remaining stages of debate. Will you reflect on that for subsequent announcements?
  Mr. Deputy Speaker: I am more than happy to reflect on that point of order, as I do on every point of order. The House will have heard the hon. Gentleman's remarks, but I am afraid that for the time being the words that I used must rest.
  Mr. Jamieson: Traffic management—the way that we manage our roads—affects all of us every day. The Bill will make sure that our road space is managed in the interests of road users, help us to get the most out of the investments that we make in our infrastructure, and cut out some of the unnecessary disruption that can clog up our roads.
  Notwithstanding what has just been said, I am glad that, in Committee, we made good progress within the time allocated. The time allocation worked well for the Committee, and the Bill has been given good scrutiny by Conservative and Liberal Democrat Members. Some elements have received widespread support on both sides of the House. I am pleased to say that, in general, debate has been constructive, and it has helped to shape Government policy. I thank all who contributed to the

  249
  discussions, not just those who were in Committee, and who made useful and worthy contributions—so good, in fact, were some of the Opposition's contributions that they changed the Government's mind. When I was in opposition, that was rare. I thank the officials and those who support the Opposition. I know that there are many people in the backrooms of Members' offices who do a lot of work on Bills and get very little thanks from the public for doing so. I place on record my thanks to those people for their work.
  Transport and infrastructure are there to support the economy, and if our economy is to function properly, goods and people need to move efficiently. Keeping traffic moving can help to improve safety and reduce pollution, so reducing congestion will help us to achieve some of our other goals. Congestion is a symptom of economic prosperity, and notwithstanding what was said on Second Reading, we now have growing economic prosperity. There are more than 1.5 million more people in work than in 1997. That is more people who are travelling to work, and more people with money in their pocket to spend on going out for leisure. I welcome that; it is a good thing and it is part of being in a prosperous, democratic society.
  There are even more utilities digging up the roads, installing new services that we want and, of course, maintaining the vital infrastructure that lies beneath our roads.
  Mr. Redwood: There are also more highways authorities, local and national, messing up the roads. Will the Minister, at this late stage, guarantee that in another place the Government will move amendments to extend to them powers that will control their activities?
  Mr. Jamieson: From our debates, certainly in Committee, we know that such authorities are already included. It is for not only the utilities but the Highways Agency and the highways authorities to make sure that they do everything to avoid impeding the flow of traffic. In fact, the Bill gives new responsibilities both to the Highways Agency, through the traffic officers, and to local authorities through traffic managers, to make sure that traffic is kept moving safety in their areas.
  Mrs. Dunwoody: Reading the Bill carefully, I find that it is precisely the fact that it all the time confirms the need to keep traffic moving that worries me. Is the Minister satisfied not only that the powers to be given to the new group of traffic officers will be properly controlled, so that we know what they are and are not capable of doing, but above all, that the general public will understand why we have yet another group of people whose function seems to be limited but whose powers seem to be considerable?
  Mr. Jamieson: In time, the public will understand the role of traffic officers, who will begin to take up duty on our roads this year. Their task is to help to keep the traffic moving and ensure the safety of people on the network, which will be appreciated by the public. The Bill will not solve all our problems, but it complements our other policies. There will be more capacity where appropriate, as is happening on the M25. Billions of pounds will he invested in local transport
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  improvements, and better use of new and existing capacity will make a difference. We need to manage both trunk roads and local roads properly, which is why the Bill gives the Highways Agency and local authorities the new powers that they need to do that job.
  On our trunk roads, 25 per cent. of congestion is caused by incidents. We will not stop all those incidents, but we can reduce the time taken to deal with them and cut out unnecessary congestion. The new traffic officer service will target new devoted resources on keeping traffic moving on our motorways, and will be a uniformed, dedicated, 24/7 force serving the motorist. It will make our motorways safer, give drivers better information and improve traffic flow. In short, the traffic officer service will be the motorist's friend.
  The Bill creates new powers for local authorities. Permit schemes and other provisions will put local traffic authorities in a stronger position to manage their roads. We are creating a realistic expectation that all local authorities will focus on managing their roads, as the best authorities are already doing. Creating new powers, however, is only part of the picture. Right hon. and hon. Members argued forcefully on Report and in Committee about many aspects of network management, authorities' own roadworks, the use of bus lanes and phasing of traffic lights—both subjects of debate today—and speed limits, and humps, which my hon. Friend the Member for Bassetlaw (John Mann) discussed in Committee. Powers are already in place to deal with such issues, but we agree that we need to make sure that they are being used properly with the right end in mind, which is why the new network management duty that we are giving to local traffic authorities is important. It is not just about doing things that are new—we need to make sure that everything else is controlled and working properly.
  The network management duty and the accompanying guidance for local authorities will focus attention on getting the right results. It will not, however, tell authorities what decisions they have to make to achieve those results. Authorities themselves are better placed than us to take those decisions. We are already making good progress. Ministers and officials are meeting key stakeholders to develop the guidance on the network management duty, and we are making similar progress with the secondary legislation stemming from parts 3 and 4. Even today, authorities and utilities are developing options for the creation of permit schemes. and I look forward to the results of their deliberations and seeing how we can make a difference to what happens on our roads.
  While this Bill is in the other place, we will work hard to make sure that its key measures deliver results for road users as soon as possible. Before the end of April, I expect the Highways Agency's traffic officers to be operating on the ground in the west midlands, and working with the police to keep traffic moving and to clear up after incidents. I look forward to the benefits that the service will deliver; to giving traffic officers their full powers when the Bill receives Royal Assent; and to the delivery of benefits in the north-west and south-east by spring 2005, and across the whole network by the end of next year.
  Mr. Paul Marsden: I reiterate the general support of the Liberal Democrats for the Bill and its concepts. The Minister has outlined the benefits that it will bring about. How will they be measured? Will it be down to individual performance mechanisms and indicators for specific parts of the traffic officer service, or will it be down, ultimately, to reducing congestion, which should be the objective?
  Mr. Jamieson: There will be a combination of those aspects. We are setting targets for the traffic officers. It will be a matter of reducing congestion and dealing with incidents more rapidly than is currently the case. There will be measures of customer satisfaction to see whether people who use the roads value the service they get when, for example, a car has gone out of control or broken down in the fast lane of a motorway. Those are hazardous and worrying situations, and the traffic officers will be able to assist. We will judge them on the basis of their contribution.
  This is a new service, and we will see how the tasks and roles of traffic officers develop. Some will become more important than others and we will change the priorities accordingly. We want to learn from the west midlands experience as we roll that out to the rest of the country, to see what traffic officers do best and how they can best contribute to keeping our traffic moving safely and to the satisfaction of all motorists, whatever type of vehicle they drive.
  As the House knows, we are making good progress towards implementing other key measures. We expect to be able to issue guidance to authorities on the network management duty very soon after Royal Assent, so that we can focus immediately on bringing together all those strands in the authorities and on keeping traffic moving on the roads. Authorities will be given the necessary powers to control street works and road works as a priority. There will be full public consultation this summer on regulations for permit schemes. We want to see authorities using those powers effectively as soon as they are available.
  People want to know how our plans will affect them. I am pleased to say that the Bill will make a difference by supporting the economy, improving safety and reducing pollution. I therefore commend the Bill to the House.
  6.27 pm
  Mr. Damian Green: As the House reaches the final stage of the Bill before it moves to another place, I pay tribute to colleagues in all parts of the House who have attempted manfully and occasionally successfully to improve it. The Minister graciously pointed out that he has taken on board some of the sensible suggestions made by my right hon. and hon. Friends, and we are delighted with that.
  On Second Reading, we moved a reasoned amendment. We accepted that we need to take steps to help drivers and others who use the road network, but we did not accept that the Government's proposals amounted to a coherent, well thought out strategy to solve the many problems on our roads that the Minister mentioned at the beginning of his speech. The central problem with the Government's approach to traffic management is incoherence. They cannot decide whether they regard the car as an evil or not. Their heart
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  tells them, and many of their own Back Benchers tell them, that motorists are a bad thing whose lives need to be made miserable, but they accept that there are tens of millions of drivers in this country, many of whom rely on the car as an essential necessity for going about their daily business.
  It is our contention that those people should have their lives improved as much as possible by the traffic management network. That is what we have been seeking to do with our suggested changes to the Bill. The question facing us today, after the Committee and Report stages, is whether enough of the many persuasive arguments put by my right hon. and hon. Friends and by hon. Members in other parts of the House, including on the Government Benches, have been taken on board by Ministers. The answer, regrettably, is no. We have done our best to improve the Bill so that it genuinely meets the needs of road users, but Ministers have insisted on sticking to the bulk of their original plans, so the Bill is not yet in a fit state for us to support it. I hope that in another place it can be changed in those areas where it is deficient.
  All that despite the rather good start to the debate on consideration. We were entirely happy to support Ministers on their new clause on blue badges to help disabled people, and we paid tribute to Members on both sides of the House who lobbied for that. Then, Ministers graciously conceded that our ideas on civil enforcement and the need for statutory guidelines are sensible. We are delighted that they agreed to look again at the wide-ranging and ill defined powers that they have given traffic wardens to impose penalties on drivers of moving vehicles, and we hope that they will return with further sensible suggestions. It was good to hear Ministers admit that we were right about the need for statutory guidelines. Indeed, the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport (Mr. Jamieson), was praised for his flexibility. Despite that, or perhaps because of it, that was it for the rest of the day as far as common sense was concerned, and we got no more real agreement from the Government.
  Nevertheless, I hope that when the Government move their own amendments in another place we can support them, because this is a key issue for those who are concerned not only with traffic management, but with the wider issue of respect for the forces of law enforcement. One of the great problems of our age is the increasing breakdown of respect among the general population for the police and other law enforcement agencies; over-zealous civilian enforcement of traffic laws is a significant contributor to that.
  The second problematic aspect of the Bill is the permit scheme that the Government propose to foist on councils and the utilities. We had an extremely entertaining debate—largely conducted, it must be said, on this side of the House—on the balance between those two good Conservative principles of low and honest taxation and local accountability. We came down on the side of low and honest taxation because, as the National Joint Utilities Group says, the Government's scheme will add £1.2 billion per annum to utilities' costs in building up their networks. That is why we suggested that the fee for any application for a permit or issue of a permit should not be higher than the administration cost incurred.

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  The arguments over the extra £55 per household tax that the Government propose to impose were well rehearsed, and I will not go over them again. However, I invite Ministers to consider what happened in the experiments that they set up to test this type of system. The Halcrow report on the pilot schemes that were implemented in Camden and Middlesbrough showed that utilities did not change their practices under lane rental although they had to pay the charges. The objectives—to reduce journey times in Camden and to reduce delays in bus journeys in Middlesbrough—were not achieved, and the additional costs to the utilities in the 11 months of the pilots were £1.18 million in Camden and £862,000 in Middlesbrough. If Ministers looked at the evidence that they themselves commissioned, they would not be proceeding down this route. It is somewhat stubborn and pig-headed of them to persist with the scheme, and I assure them that we will continue our opposition in another place.
  The third area where the Bill is seriously deficient is in the effect on the breakdown services of the proposals on managing incidents on motorways. Ministers have fallen over themselves to provide assurances that they do not intend to damage the RAC, the AA and Green Flag, and did so again today. Sadly, they seem not to have read their own Bill, which permits the Highways Agency to establish a monopoly roadside recovery service funded by charges on motorists. Given Ministers' record on milking motorists, they should understand why bodies such as the AA and the RAC, which are of course supportive of improved incident management, are so concerned about the Bill. Ministers will probably not listen to Opposition parties, but perhaps they will listen to the motoring organisations, which, as has been pointed out, have 10 million members. The AA says:
  "The Bill, as drafted, could not only enable the removal of motorists' existing right of choice of commercial provider but also remove the existing right of one motorist to stop and help another&#x2026;Consumer protection issues also appear to have been overlooked because the Bill gives powers for charges to be set to create a revenue stream in the financial interests of the HA"&#x2014;
  the Highways Agency—
  "or contractors".
  In other words, the body empowered to remove vehicles will be funded by the charges that it can make. I should have thought that that in itself would be enough to ring alarm bells with Ministers.
  The AA makes another good point, particularly apposite given our debate on blue badges and the needs of disabled drivers:
  "The Disabled Drivers Association says that the special needs services provided by the major roadside recovery organisations are vital to hundreds of thousands of vulnerable drivers. It would neither make sense nor be acceptable to them to put these national services under threat".
  Ministers need to look again at those points.
  The RAC envisages:
  "A needless doubling up of resources",
  because
  "70 to 80 per cent. of our customers call for help from a mobile phone. This means that in many cases breakdown organisations will already have sent a recovery vehicle before the Highways Agency becomes involved".
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  The RAC, too, is concerned about unfair charging of motorists and in particular—the Minister did not address this extremely good point at all—the second order effect, by which there will be a reduction in the number of motorists with breakdown cover. If people know that the Highways Agency has some kind of monopoly right on motorways, and will come along, charge them what it likes and take their cars away anyway, that will discourage them from joining the excellent breakdown organisations.
  Mr. Jamieson: I am not sure whether the hon. Gentleman was in the Chamber when we debated that on Report, but if so he would have heard me say that we hold the breakdown services in the highest regard and that the Government have no intention, through the Highways Agency or any other body, of supplanting their excellent work. There will be no incentive for people to leave the AA, the RAC or any other body under the "second order" to which the hon. Gentleman refers, because they will be charged for having their vehicle totally removed from the road. The only powers that we have transferred to traffic officers are those that the Conservative Government gave the police, back in 1984.
  Mr. Green:I was here, and I heard the Minister give those warm words, but he does not appear to have listened to the words of the organisations. The fact is that they do not believe him, and I am afraid that we are now at the stage of the decaying years of this Government when no one believes a word that they say. The Minister can reassure people until he is blue in the face, but it is quite clear that those hugely responsible, popular, important organisations have not been reassured. He has made exactly the same points on meetings taking place in a few weeks' time as he made on Second Reading, and he has not accepted any amendments drafted by those organisations and tabled by my right hon. and hon. Friends. I am therefore not surprised that they suspect his motives. The warm words that he keeps repeating are not backed up by any deeds. Until Ministers do something to help the emergency organisations, rather than just say how much they value them, they will not be credible on this point.
  Among the noteworthy aspects of today's debates were the warm tributes to local authorities and local power that the Minister kept paying. He will be aware, however, of the real concerns of local government about the centralising tendencies of the Bill as it stands, in particular about the powers to impose traffic directors on local authorities. The Bill does not state in what circumstances that might happen or what evidence the Government will have to produce to enable them to act in that way. It does not set a timetable for any review of arrangements in cases in which the Government have declared a local authority to have failed and have taken away its powers of traffic management—[Interruption.] The Minister is sitting there chuntering, but he should perhaps talk to his colleagues in the Local Government Association, who made those points very strongly in the days leading up to this debate. He has not convinced even his Labour colleagues in the LGA: yet another group of people who can see that Ministers' words and deeds are completely out of sync.

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  In amendment No. 1, which we did not reach, we suggested adding to statutory duty the need to keep the roads in good repair. My hon. Friend the Member for West Derbyshire (Mr. McLoughlin) made the good point that the Bill has therefore not completed its scrutiny. Surely it is a basic and sensible aspiration to ask local highways authorities to keep the roads in good repair. That is the sort of thing that should appear in a traffic management Bill, and it is a great shame that, because of the Government's habit of trying to shorten parliamentary scrutiny of their legislation, perfectly non-contentious and sensible ideas such as that in amendment No. 1 cannot even be debated in the House.
  So the Bill, which purports to help traffic flow and improve the conditions on our roads, has failed to achieve its objectives. It should have provided relief for congested streets and frustrated road users, but it is now clear that we shall have to wait for such useful legislation until the next Conservative Government. This Government have been waging war on the motorist since they came to power and, sadly, the Bill does not mark a ceasefire, as it was meant to. In its own terms, the Bill fails in its purpose, and I urge the House to reject it.
  6.40 pm
  Mrs. Dunwoody: Any traffic management scheme must be properly organised, and the Bill represents a sensible attempt to do exactly that. We desperately need to bring a bit of sense to the way in which we manage our road space in congested towns and villages and to accept that many different groups of people need to use what is a very limited space.
  I have one reservation about the Bill, however, and I would like to spend a minute putting it on record. The powers that it gives to traffic officers are very wide-ranging while not being tremendously precise. They also appear to present some difficulties. We are creating a new traffic police force without the full skills and abilities of true traffic policemen. We could easily have expanded the existing police forces to create a real traffic police force, if it were only the clogging up of motorways that was causing the difficulty. I hope that we shall not regret this decision in due course.
  6.41 pm
  John Thurso: I see a number of other hon. Members waiting to speak, so I shall be brief. I pay tribute to all hon. Members who took part in our proceedings today and in Committee, which was certainly helpful to the Bill.
  I gave the Bill a pretty broad welcome on Second Reading. I said that its general principles were right, and that is still my view. I raised three points at that time, and 1 shall touch briefly on each of them now. The Minister mentioned the problems of congestion. They certainly impede our economy and add to emissions, which has a negative impact on the environment and on human health. The Bill is welcome in that it seeks to address those problems in general terms.
  We have talked about the timetable for the Bill, and it certainly proved adequate in Committee. The Bill received good scrutiny, and I pay tribute to the business managers for achieving that. I am also grateful to the
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  Minister for mentioning the backroom staff on all sides; they do a good job. I appreciated the opportunity, as did my staff, to meet his officials to consider various aspects of the Bill. I have to say, however, that on Report, holding six short debates was perhaps not the best way to proceed. I am sorry that we did not get to the one debate that I would have liked to take part in, which was the one on my amendment.
  I expressed my concern on Second Reading that traffic officers and traffic managers might not have sufficient regard to safety. The Minister gave reassurances in Committee in that regard, which I was content to accept. I believe, from what he has said, that the commitment to road safety will be there. Another point that I raised with him, about which I am less certain, relates to environmental management, and to whether network managers will have sufficient regard to that issue. There is an imbalance between keeping traffic moving and what is best for the environment. It remains to be seen whether the Bill will look after what is required for the environment.
  One issue that we debated in Committee and failed to get to today was the London settlement in the Greater London Authority Act 1999 and how the powers that the Bill confers will relate to traffic directors and the Mayor. As the Bill stands, it removes the primacy of the Mayor on transport matters, by enabling traffic directors to override the Mayor's strategy and directions in relation to local implementation plans, and his directions to Transport for London. It therefore contains a major shift in the London devolution settlement. In Committee, the Minister said that it was not the Government's intention to unpick the devolution settlement, but further research has shown that that is precisely what they did, as the back-stop powers that they required were already available under clause 143 of the Bill that set up the Greater London authority. That matter may have to be dealt with in another place.
  Notwithstanding that fairly severe reservation and the other matters that I touched on, I believe that the principles of the Bill are correct. It is important that our traffic be kept flowing as freely as possible. My colleagues and I are content to support the Government in the Lobby.
  6.45 pm
  Brian White: Consideration on Second Reading began with the Government responding positively to a letter that I wrote about the concerns of utility companies by setting up the working group. This afternoon, the Government accepted an amendment on the blue badge scheme that I tabled in Committee. I thank Ministers for their positive response throughout.
  Having said that, I raised a number of other concerns in Committee regarding the permit scheme and road safety that Ministers need to continue to take on board during the ongoing consultation. The assurances that they gave in Committee on how those concerns will be dealt with in the ongoing discussions are important, particularly those on network management having a duty to deal with road safety issues.
  It is important to get the balance right between utilities and local authorities—that has been mentioned today—and in the co-ordination of street works. I

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  welcome the assurance that the Government gave in Committee that start-up companies will not find themselves at an unfair disadvantage over the works that are essential for the growth of our economy. I appreciate that the right hon. Member for Bromley and Chislehurst (Mr. Forth) will want to endorse that.
  The traffic forum proposals should be taken forward. Also, the involvement of stakeholders in drawing up the regulations and, in particular, the need for joined-up government, are important. It is not only the Department for Transport that should be involved.
  The Bill is a useful step forward and I urge Ministers, as they take the consultation forward, to take on board the real, underlying concerns that gave rise to a number of amendments that were considered in Committee.
  6.47 pm
  Mr. Redwood: Previous Transport Ministers under this Government worked on the assumption that 30 million motorists must be wrong. If the motorists were not wrong, they would impose rules, regulations and new restrictions to ensure that they were, and then charge them for it.
  The latest Secretary of State and his ministerial team offered us something better. We were told that they had seen the light: they had come to realise that most people most of the time make their journeys by car, that most goods move by van or lorry, and that however successfully we improve railways and other public transport modes—this Government have been singularly unsuccessful in that—we are unlikely to get away from the fact that the overwhelming majority of longer journeys are undertaken by road vehicle.
  We entered into the spirit of the Bill expecting great things. Certainly, the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport (Mr. Jamieson) has been pleasant and agreeable—from time to time, he has found merit in what the Opposition have said—so it is more in sorrow than anger that I have to say that I share the disappointment of my hon. Friend the Member for Ashford (Mr. Green), who sits on our Front Bench.
  I was expecting much more. I was told on Second Reading that several ideas that I had put forward had a lot to recommend them and would help to improve traffic flow, but I find that somehow they have not found their way into the Bill as yet. I live in hope, because in the other place, where there is a better voting balance, wiser heads may prevail. The Minister may take away from today's debates some better ideas that could be reflected in the Bill before it returns to the House.
  So many points need improving. Today, for example, the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) talked about important issues concerning delivery vehicles. She is worried about the lot of the milk float. It has to go out early in the morning and hazard its way round the bus lanes worrying about infringements and taxes being imposed on it if it intervenes by using the bus lane. The driver also has to worry about crossing the bus lane on foot, presumably after having parked in the middle of the highway. That is a ludicrous situation. The Minister agreed, but had no immediate solution. The milk float is one of many delivery vehicles that have to chance their arm with bus lane regulations. I hope that the
  258
  Government will think again and understand the need for change. One possible solution is to alter the times at which bus lanes come into effect, so that early-morning deliveries can take place without difficulty. If we want to improve road capacity and reduce congestion, bus lanes should only operate at busy times of day, when frequent and regular bus services need to use them. It seems ridiculous to blank off half or one third of the highway on each side for the whole day when often no congestion warrants that intrusion or no buses are using that facility.
  We have attempted to address speed limits but without success. All of us believe that low limits should be imposed where vulnerable people—particularly children and the elderly—may be on or near the carriageway. At times when children are entering or leaving school, it makes sense to impose tight speed controls. They can also make a lot of sense when applied to busy roads in residential areas and near the homes of elderly people.
  It does not make sense to impose a series of varied speed limits—30, 40, 50, 60 or 70 mph—on main trunk roads through urban areas in a way that the motorist finds confusing. Often, lower speed limits are set than most motorists judge to be safe. Those arbitrary limits are buttressed with cameras as a way of collecting large sums of money from motorists who may not be aware that the limit has suddenly changed from 60 or 50 mph to 40 mph and have to make a contribution to the one-armed bandits in the sky.
  The Under-Secretary frowns, but an experienced motorist used to be able to judge the speed limit by the environment through which he or she was driving. If one was driving through a well-lit, built-up area one knew that the limit was 30 mph. A dual carriageway in an urban area meant a 40 mph limit. Anywhere else on a main highway meant a 60 mph limit in the case of a single carriageway and 70 mph for a motorway-type road.
  There is now a stunning array of different speed limits, particularly in urban areas. Experienced motorists cannot guess or judge but have to keep their eyes skinned to the side of the road to see the one sign—often covered in mud, dirty and not easily recognisable—when their eyes should be fixed on the road ahead, in case there is an unusual impediment. As a result, even law-abiding motorists often get caught out in areas they do not know well. There should be a much more rational approach. My hon. Friends on the Front Bench suggest a limit of 80 mph on motorways. In trying to observe, as I do, the 70 mph limit I am always in the slow lane and practically every other vehicle overtakes. If I broke the speed limit and got caught, that would make far too exciting a story—so like the Minister, I suspect, I try to behave myself. I notice that most of my constituents do not believe that the 70 mph speed limit is reasonable or sensible and regularly break it.
  Parking is another issue that we have debated but on which we have not succeeded in changing the Minister's mind. One reason why highway capacity is so limited is that many people at home and work and in town centres have to park their vehicles on the carriageway because planning rules do not make sufficient provision for

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  parking, hard standing or garaging. That does not stop people owning and using cars but means that a large number of vehicles, when not in use, stand out on the highway—reducing the space available on a crowded highway network in a crowded island. I hope that Transport Ministers will talk to their planning colleagues and re-examine the guidelines.
  The guidelines are based on the false proposition that, if planners restrict the amount of garage and hard-standing space in people's homes, and the amount of car parking in city and town centres, people will be deterred from owning or using cars. That is a misunderstanding of human nature. As society gets more prosperous, and as the public transport alternatives are so obviously not up to many people's demands in relation to going to work, taking the children to school or going about their leisure and pleasure, of course, people will own cars. If there is not sufficient parking space at home, they will park out on the highway, and if there are not sufficient off-road parking places in town and city centres, more congestion will result as vehicles circulate around the town and city desperately looking for the limited parking places available, and having to play a kind of Russian roulette to get one. That increases congestion and pollution, and does not succeed meeting in the green objectives that underlie the policy.
  We have debated the issue of bus lanes. Again, it was disappointing that Ministers did not decide to include in the Bill a provision to allow vulnerable vehicles and other users of the highway such as motor cyclists and cyclists the right in every case to use the bus lane. Ministers were persuaded of the case for cyclists to use the bus lane, and said that that usually happened, so it would not have hurt to put it clearly in the legislation. They also said that they were studying the case of motor cyclists. Hundreds of thousands of cyclists and motor cyclists who may hear about this debate will be disappointed that the Bill does not recognise their needs or include them as reasonable users of the bus lane. The Minister says that he has a lot of sympathy with my view, so I do not know why he cannot use his legislative pen to put my mind at rest and show either that that is happening or that it should happen as a matter of course.
  Many Members on both sides of the House recognise that traffic lights, their location and use, are one of the big problems in creating congested Britain. We have made several proposals for improving the use, phasing and deployment of traffic lights, which we think could make a lot of sense. The case, as with that for amending the bus lane regulations, is based on safety as well as speed and ease of passage. Many accidents occur at junctions, which is not surprising given that, at junctions, traffic moving in different directions comes into conflict and powerful vehicles come into potential conflict with bicycles and pedestrians. Junctions are the most dangerous parts of the road network. Our motorways, which are by far and away our fastest roads, are also our safest roads, because most of the hazards of the junction have been taken out by grade-separated
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  interchanges, meaning that traffic moving in different directions never comes into conflict. Of course, no pedestrians or push cycles are allowed on motorways. Relatively high speeds at uncongested times of day are therefore combined with much greater safety because of segregation of traffic and proper use of the motorway.
  On the main trunk road network, which does not have dual carriageway and grade-separated interchange provision, there is much more conflict between different types of vehicle moving in different directions and more vulnerable road users. I hope that, as a result of the debate, the Government will recognise the need to study those junctions and how many of them can be enlarged and improved with a view to segregating different users of the junction and segregating traffic flowing in different directions to reduce the likelihood of conflict. My single message to the Government on safety and congestion is that it is not speed that causes the accidents, and it is not just a case of trying to get traffic moving more quickly to stop congestion. If we want a really safe highway network, we must design conflict out and we will then cure both congestion and many of the safety problems.
  We need to be much kinder to the pedestrian. On the railways, we have a very good rule that people should never walk anywhere near the tracks and should not try to cross the railway lines other than by means of a bridge, and yet different rules seem to apply when it comes to managing the main road network. As a pedestrian in London rather than a car user, I think that we pedestrians should also obey the rules. Pedestrians should have proper provision, probably with more bridges and underpasses, so that we can cross the road without having to wait for traffic and avoid the conflict between pedestrians and cars that often occurs.
  The Bill provides for a massive stealth tax on the utility companies. My right hon. and hon. Friends have calculated that it could be as much as £55 per household as a result of the powers—
  It being Seven o'clock, MADAM DEPUTY SPEAKER put the Question already proposed from the Chair, pursuant to Order [5 January].
  The House divided: Ayes 333, Noes 136.
  Division No. 93]
  [7:00 pm

  AYES

  Abbott, Ms Diane

  Benn, rh Hilary

  Ainger, Nick

  Bennett, Andrew

  Ainsworth, Bob(Cov'try NE)

  Blackman, Liz

  Alexander, Douglas

  Blears, Ms Hazel

  Allan, Richard

  Blizzard, Bob

  Allen, Graham

  Borrow, David

  Anderson, rh Donald(Swansea E)

  Bradley, rh Keith(Withington)

  Armstrong, rh Ms Hilary

  Bradley, Peter(The Wrekin)

  Atherton, Ms Candy

  Bradshaw, Ben

  Atkins, Charlotte

  Brake, Tom(Carshalton)

  Austin, John

  Breed, Colin

  Bailey, Adrian

  Brennan, Kevin

  Baird, Vera

  Brooke, Mrs Annette L.

  Banks, Tony

  Brown, rh Nicholas(Newcastle E Wallsend)

  Barnes, Harry

  Barrett, John

  Bruce, Malcolm

  Battle, John

  Buck, Ms Karen

  Bayley, Hugh

  Burnett, John

  Beckett, rh Margaret

  Burnham, Andy

  Bell, Sir Stuart

  Burstow, Paul

  261

  Byersm rh Stephen

  Gibson, Dr. Ian

  Cairns, David

  Gidley, Sandra

  Calton, Mrs Patsy

  Gilroy, Linda

  Campbell, Alan(Tynemouth)

  Godsiff, Roger

  Campbell, rh Sir Menzies(NE Fife)

  Goggins, Paul

  Green, Matthew(Ludlow)

  Campbell, Ronnie(Blyth V)

  Griffiths, Nigel(Edinburgh S)

  Caplin, Ivor

  Griffiths, Win(Bridgend)

  Caton, Martin

  Grogan, John

  Cawsey, Ian(Brigg)

  Hain, rh Peter

  Challen, Colin

  Hall, Mike(Weaver Vale)

  Chapman, Ben (Wirral S)

  Hall, Patrick(Bedford)

  Chaytor, David

  Hancock, Mike

  Chidgey, David

  Hanson, David

  Clark, Mrs Helen(Peterborough)

  Harman, rh Ms Harriet

  Clark, Dr. Lynda(Edinburgh Pentlands)

  Harris, Dr. Evan(Oxford W & Abingdon)

  Clarke, rh Tom(Coatbridge & Chryston)

  Harvey, Nick

  Havard, Dai(Merthyr Tydfil & Rhymney)

  Clelland, David

  Coaker, Vernon

  Healey, John

  Coleman, lain

  Heath, David

  Connarty, Michael

  Henderson, Ivan(Harwich)

  Cook, Frank(Stockton N)

  Hepburn, Stephen

  Cooper, Yvette

  Hesford, Stephen

  Corbyn, Jeremy

  Heyes, David

  Corston, Jean

  Hinchliffe, David

  Cotter, Brian

  Hodge, Margaret

  Cousins, Jim

  Hoey, Kate(Vauxhall)

  Cox, Tom(Tooting)

  Holmes, Paul

  Cranston, Ross

  Hope, Phil(Corby)

  Crausby, David

  Hopkins, Kelvin

  Cruddas, Jon

  Howarth, George(Knowsley N & Sefton E)

  Cryer, John(Hornchurch)

  Cunningham, Jim(Coventry S)

  Howells, Dr. Kim

  Cunningham, Tony(Workington)

  Hughes, Beverley(Stretford & Urmston)

  Dalyell, Tam

  Davey, Edward(Kingston)

  Hughes, Kevin(Doncaster N)

  Davey, Valerie(Bristol W)

  Humble, Mrs Joan

  David, Wayne

  Hurst Alan(Braintree)

  Davies, rh Denzil(Llanelli)

  Hutton, rh John

  Davies, Geraint(Croydon C)

  Iddon, Dr. Brian

  Dawson, Hilton

  Illsley, Eric

  Dean, Mrs Janet

  Ingram, rh Adam

  Dhanda, Parmjit

  Jackson, Glenda(Hampstead & Highgate)

  Dismore, Andrew

  Dobbin, Jim(Heywood)

  Jackson, Helen(Hillsborough)

  Dobson, rh Frank

  Jamieson, David

  Donohoe, Brian H.

  Jenkins, Brian

  Doran, Frank

  Johnson, Miss Melanie(Welwyn Hatfield)

  Dowd, Jim(Lewisham W)

  Drew, David(Stroud)

  Jones, Helen(Warrington N)

  Dunwoody, Mrs Gwyneth

  Jones: Kevan(N Durham)

  Eagle, Maria(L'pool Garston)

  Jones, Lynne(Selly Oak)

  Edwards, Huw

  Jones, Martyn(Clwyd S)

  Ellman, Mrs Louise

  Jones, Nigel(Cheltenham)

  Etherington, Bill

  Kaufman, rh Gerald

  Farrelly, Paul

  Keeble, Ms Sally

  Field, rh Frank(Birkenhead)

  Keen, Alan(Feltham)

  Fisher, Mark

  Keen, Ann(Brentford)

  Fitzpatrick, Jim

  Keetch, Paul

  Fitzsimons, Mrs Lorna

  Kemp, Fraser

  Flint, Caroline

  Kennedy, rh Charles(Ross Skye & Inverness)

  Flynn, Paul(Newport W)

  Follett, Barbara

  Khabra, Piara S.

  Foster, rh Derek

  Kidney, David

  Foster, Don(Bath)

  Kilfoyle, Peter

  Foster, Michael(Worcester)

  King, Ms Oona(Bethnal Green & Bow)

  Foster, Michael Jabez(Hastings & Rye)

  Kirkwood, Sir Archy

  Foulkes, rh George

  Knight, Jim(S Dorset)

  Francis, Dr. Hywel

  Kumar, Dr, Ashok

  Gardiner, Barry

  Ladyman, Dr. Stephen

  George, Andrew(St. Ives)

  Lamb, Norman

  George, rh Bruce(Walsall S)

  Lammy, David

  Gerrard, Neil

  Lawrence, Mrs Jackie

  262

  Laws, David(Yeovil)

  Reid, Alan(Argyll & Bute)

  Laxton, Bob(Derby N)

  Robertson, John(Glasgow Anniesland)

  Lepper, David

  Leslie, Christopher

  Robinson, Geoffrey(Coventry NW)

  Lewis, Terry(Worsley)

  Liddell, rh Mrs Helen

  Roche, Mrs Barbara

  Linton, Martin

  Rooney, Terry

  Llwyd, Elfyn

  Ross, Ernie(Dundee W)

  Love, Andrew

  Roy, Frank(Motherwell)

  Lucas, Ian(Wrexham)

  Ruane, Chris

  McAvoy, Thomas

  Russell, Bob(Colchester)

  McCafferty, Chris

  Russell, Ms Christine(City of Chester)

  McCartney, rh Ian

  MacDonald, Calum

  Ryan, Joan(Enfield N)

  McDonnell, John

  Sanders, Adrian

  McFall, John

  Sarwar, Mohammad

  Mclsaac, Shona

  Savidge, Malcolm

  Mackinlay, Andrew

  Sawford, Phil

  McNulty, Tony

  Sedgemore, Brian

  Mactaggart, Fiona

  Shaw, Jonathan

  McWalter, Tony

  Sheerman, Barry

  McWilliam, John

  Sheridan, Jim

  Mahon, Mrs Alice

  Short, rh Clare

  Mann, John(Bassetlaw)

  Simpson, Alan(Nottingham S)

  Marris, Rob(Wolverh'ton SW)

  Singh, Marsha

  Marsden, Gordon(Blackpool S)

  Skinner, Dennis

  Marsden, Paul(Shrewsbury & Atcham)

  Smith, rh Andrew(Oxford E)

  Smith, rh Chris(Islington S & Finsbury)

  Marshall, David(Glasgow Shettleston)

  Smith, Geraldine(Morecambe & Lunesdale)

  Marshall, Jim(Leicester S)

  Martlew, Eric

  Smith, Jacqui(Redditch)

  Merron, Gillian

  Smith, John(Glamorgan)

  Michael, rh Alun

  Smith, Llew(Blaenau Gwent)

  Miliband, David

  Soley, Clive

  Miller, Andrew

  Squire, Rachel

  Mitchell, Austin(Gt Grimsby)

  Starkey, Dr. Phyllis

  Moffatt, Laura

  Steinberg, Gerry

  Mole, Chris

  Stevenson, George

  Moonie, Dr. Lewis

  Stinchcombe, Paul

  Moore, Michael

  Stoate, Dr. Howard

  Moran, Margaret

  Strang, rh Dr. Gavin

  Morgan, Julie

  Stringer, Graham

  Morley, Elliot

  Stuart, Ms Gisela

  Mountford, Kali

  Stunell, Andrew

  Mudie, George

  Sutcliffe, Gerry

  Murphy, Denis(Wansbeck)

  Taylor, Dari(Stockton S)

  Naysmith, Dr. Doug

  Taylor, David(NW Leics)

  Norris, Dan(Wansdyke)

  Taylor, Matthew(Truro)

  Oaten, Mark(Winchester)

  Taylor, Dr. Richard(Wyre F)

  O'Hara, Edward

  Teather, Sarah

  Olner, Bill

  Thomas, Gareth(Clwyd W)

  Opik, Lembit

  Thomas, Gareth(Harrow W)

  Organ, Diana

  Thomas, Simon(Ceredigion)

  Owen, Albert

  Thurso, John

  Palmer, Dr. Nick

  Todd, Mark(S Derbyshire)

  Pickthall, Colin

  Tonge, Dr. Jenny

  Plaskitt, James

  Touhig, Don(IsIwyn)

  Pollard, Kerry

  Trickett, Jon

  Pond, Chris(Gravesham)

  Truswell, Paul

  Pope, Greg(Hyndburn)

  Turner, Dennis(Wolverh'ton SE)

  Prentice, Ms Bridget(Lewisham E)

  Turner, Dr. Desmond(Brighton Kemptown)

  Prentice, Gordon(Pendle)

  Turner, Neil(Wigan)

  Prescott, rh John

  Twigg, Derek(Halton)

  Price, Adam(E Carmarthen & Dinefwr)

  Tyler, Paul(N Cornwall)

  Tynan, Bill(Hamilton S)

  Primarolo, rh Dawn

  Vis, Dr. Rudi

  Prosser, Gwyn

  Ward, Claire

  Pugh, Dr. John

  Wareing, Robert N.

  Purchase, Ken

  Watson, Tom(W Bromwich E)

  Quinn, Lawrie

  Watts, David

  Rammell, Bill

  Webb, Steve(Northavon)

  Rapson, Syd(Portsmouth N)

  White, Brian

  Raynsford, rh Nick

  Whitehead, Dr Alan

  Reed, Andy(Loughborough)

  Wicks, Malcoim

  263

  Williams, Roger(Brecon)

  Worthington, Tony

  Willis, Phil

  Wright, David(Telford)

  Wills, Michael

  Wright. Tony(Cannock)

  Winnick, David

  Younger-Ross, Richard

  Winterton, Ms Rosie(Doncaster C)

  Tellers for the Ayes:

  Woodward, Shaun

  Mr. John Heppell and

  Woolas, Phil

  Paul Clark

  NOES

  Ainsworth, Peter(E Surrey)

  Cormack, Sir Patrick

  Amess, David

  Cran, James(Beverley)

  Ancram, rh Michael

  Curry, rh David

  Atkinson, Peter(Hexham)

  Davies, Quentin(Grantham & Stamford)

  Bacon, Richard

  Baldry, Tony

  Davis, rh David(Haltemprice & Howden)

  Barker, Gregory

  Baron, John(Billericay)

  Dorrell, rh Stephen

  Bellingham, Henry

  Fabricant, Michael

  Blunt Crispin

  Fallon, Michael

  Boswell, Tim

  Field, Mark(Cities of London & Westminister)

  Bottomley, Peter(Worthing W)

  Bottomley, rh Virginia(SW Surrey)

  Flook, Adrian

  Forth, rh Eric

  Brady, Graham

  Fox, Dr. Liam

  Brazier, Julian

  Francois, Mark

  Browning, Mrs Angela

  Gale, Roger(N Thanet)

  Burns, Simon

  Gamier, Edward

  Burnside, David

  Goodman, Paul

  Burt, Alistair

  Gray, James(N Wilts)

  Butterfill, Sir John

  Green, Damian(Ashford)

  Cameron, David

  Grieve, Dominic

  Campbell, Gregory(E Lond'y)

  Gummer, rh John

  Cash, William

  Hague, rh William

  Chapman, Sir Sydney(Chipping Barnet)

  Hammond, Philip

  Hawkins, Nick

  Chope, Christopher

  Hayes, John(S Holland)

  Clappison, James

  Heald, Oliver

  Clarke, rh Kenneth(Rushcliffe)

  Heathcoat-Amory, rh David

  Collins, Tim

  Hendry, Charles

  Conway, Derek

  Hermon, Lady

  264

  Hoban, Mark(Fareham)

  Robertson, Hugh(Faversham & M-Kent)

  Horam, John(Orpington)

  Howard, rh Michael

  Robinson, Mrs Iris(Strangford)

  Hunter, Andrew

  Roe, Mrs Marion

  Jack, rh Michael

  Rosindell, Andrew

  Jackson, Robert(Wantage)

  Shephard, rh Mrs Gillian

  Jenkin, Bernard

  Shepherd, Richard

  Johnson, Boris(Henley)

  Simmonds, Mark

  Key, Robert(Salisbury)

  Simpson, Keith(M-Norfolk)

  Kirkbride, Miss Julie

  Soames, Nicholas

  Knight, rh Greg(E Yorkshire)

  Spelman, Mrs Caroline

  Laing Mrs Eleanor

  Spicer, Sir Michael

  Lait, Mrs Jacqui

  Spink, Bob(Castle Point)

  Lansley Andrew

  Stanley, rh Sir John

  Leigh, Edward

  Steen, Anthony

  Letwin, rh Oliver

  Streeter, Gary

  Lewis, Dr. Julian(New Forest E)

  Swayne, Desmond

  Liddell-Grainger, Ian

  Swire, Hugo(E Devon)

  Lidington, David

  Syms, Robert

  Lilley, rh Peter

  Tapsell, Sir Peter

  Loughton, Tim

  Taylor, John(Solihull)

  Luff, Peter(M-Worcs)

  Taylor, Sir Teddy

  McIntosh, Miss Anne

  Tredinnick, David

  Mackay, rh Andrew

  Trend, Michael

  Maclean, rh David

  Turner, Andrew(Isle of Wight)

  McLoughlin, Patrick

  Tyrie, Andrew

  Maples, John

  Viggers, Peter

  Mawhinney, rh Sir Brian

  Walter, Robert Maples,

  Maples, John

  Waterson, Nigel

  Mawhinney, rh Sir Brian

  Whittingdale, John

  May, Mrs Theresa

  Widdecombe, rh Miss Ann

  Mitchell, Andrew(Sutton &Coldfield)

  Wiggin, Bill

  Wilkinson. John

  Moss, Malcolm

  Willets, David

  Murrison, Dr. Andrew

  Wilshire, David

  Norman, Archie

  Winterton. Ann(Congleton)

  O'Brien, Stephen(Eddisbury)

  Winterton, Sir Nicholas

  Osborne, George(Tatton)

  (Macclesfield)

  Ottaway, Richard

  Yeo, Tim(S Suffolk)

  Page, Richard

  Young, rh Sir George

  Paterson, Owen

  Prisk, Mark (Hertford)

  Tellers for the Noes:

  Randall, John

  Mr. David Bailey and

  Redwood, rh John

  Mr. Geoffrey Clifton-Brown

  Question accordingly agreed to.

European Parliamentary and Local Elections (Pilots) Bill
Lords Reasons for insisting on certain of their amendments to which the Commons have disagreed, considered
7.16 pm
Madam Deputy Speaker: Under the Order of the House of 8 March, any message from the Lords relating to the European Parliamentary and Local Elections (Pilots) Bill may be considered forthwith, without Question put.
A message has been received from the Lords as follows: the Lords disagree to the Commons amendment to a Lords amendment to the European Parliamentary and Local Elections (Pilots) Bill, and they insist on a Lords amendment to which the Commons have disagreed, for which disagreement they assign their reason.
Mr. Patrick McLoughlin: I beg to move, That the House do now sit in private.
Question put ,forthwith, pursuant to Standing Order No. 163 (Motions to sit in private):—
The House proceeded to a Division.
Madam Deputy Speaker: I have asked the Serjeant at Arms to investigate the delay in the Lobby.
The House having divided: Ayes 122, Noes 311.
Division No. 94]
[7:17 pm

AYES

Ainsworth, Peter(E Surrey)

Duncan Smith, rh lain

Amess, David

Fabricant, Michael

Ancram, rh Michael

Fallon, Michael

Atkinson, Peter(Hexham)

Field, Mark(Cities of London & Westminster)

Bacon, Richard

Baldry, Tony

Flook, Adrian

Barker, Gregory

Forth, rh Eric

Beggs, Roy(E Antrim)

Fox, Dr. Liam

Blunt, Crispin

Francois, Mark

Boswell, Tim

Gale, Roger(N Thanet)

Bottomley, Peter(Worthing W)

Garnier, Edward

Bottomley, rh Virginia(SW Surrey)

Goodman, Paul

Gray, James(N Wilts)

Brady, Graham

Green, Damian(Ashford)

Brazier, Julian

Grieve, Dominic

Browning, Mrs Angela

Gummer, rh John

Burns, Simon

Hague, rh William

Burnside, David

Hammond, Philip

Burt, Alistair

Hawkins, Nick

Butterfill, Sir John

Hayes, John(S Holland)

Cameron, David

Heald, Oliver

Cash, William

Heathcoat-Amory, rh David

Chapman, Sir Sydney(Chipping Barnet)

Hendry, Charles

Hermon, Lady

Chope, Christopher

Hoban, Mark(Fareham)

Clappison, James

Horam, John(Orpington)

Clarke, rh Kenneth(Rushcliffe)

Hunter, Andrew

Collins, Tim

Jack, rh Michael

Conway, Derek

Jenkin, Bernard

Cormack, Sir Patrick

Johnson, Boris(Henley)

Curry, rh David

Key, Robert(Salisbury)

Davies, Quentin(Grantham & Stamford)

Kirkbride, Miss Julie

Knight, rh Greg(E Yorkshire)

Davis, rh David (Haltemprice & Howden)

Laing, Mrs Eleanor

Lait, Mrs Jacqui

Duncan, Peter(Galloway)

Lansley, Andrew

266

Leigh, Edward

Spelman, Mrs Caroline

Lewis, Dr. Julian(New Forest E)

Spicer, Sir Michael

Liddell-Grainger, Ian

Spink, Bob(Castle Point)

Lidington, David

Stanley, rh Sir John

Lilley, rh Peter

Steen, Anthony

McIntosh, Miss Anne

Streeter, Gary

Mackay, rh Andrew

Swayne, Desmond

Maclean, rh David

Swire, Hugo(E Devon)

Maples, John

Syms, Robert

Mawhinney, rh Sir Brian

Tapsell, Sir Peter

Mitchell, Andrew(Sutton Coldfield)

Taylor, John(Solihull)

Taylor, Sir Teddy

Moss, Malcolm

Tredinnick, David

Murrison, Dr. Andrew

Trend, Michael

Norman, Archie

Turner, Andrew(Isle of Wight)

O'Brien, Stephen(Eddisbury)

Tyrie, Andrew

Osborne, George(Tatton)

Walter, Robert

Ottaway, Richard

Waterson, Nigel

Page, Richard

Whittingdale, John

Paterson, Owen

Wiggin, Bill

Prisk, Mark(Hertford)

Wilkinson, John

Randall, John

Willetts, David

Redwood, rh John

Wilshire, David

Robertson, Hugh(Faversham & M-Kent)

Winterton, Sir Nicholas(Macclesfield)

Roe, Mrs Marion

Yeo, Tim(S Suffolk)

Rosindell, Andrew

Young, rh Sir George

Shephard, rh Mrs Gillian

Shepherd, Richard

Tellers for the Ayes:

Simmonds, Mark

Mr. David Ruffley and

Simpson, Keith(M-Norfolk)

Mr. Geoffrey Clifton-Brown

NOES

Abbott, Ms Diane

Campbell, Ronnie(Blyth V)

Ainger, Nick

Caplin, Ivor

Ainsworth, Bob(Cov'try NE)

Caton, Martin

Alexander, Douglas

Cawsey, Ian(Brigg)

Allan, Richard

Challen, Colin

Allen, Graham

Chapman, Ben(Wirral S)

Anderson, rh Donald(Swansea E)

Chaytor, David

Armstrong, rh Ms Hilary

Chidgey, David

Atherton, Ms Candy

Clark, Mrs Helen(Peterborough)

Atkins, Charlotte

Clark, Dr. Lynda(Edinburgh Pentlands)

Austin, John

Bailey, Adrian

Clelland, David

Baird, Vera

Coaker, Vernon

Banks, Tony

Connarty, Michael

Barnes, Harry

Cook, Frank(Stockton N)

Barrett, John

Cooper, Yvette

Beard, Nigel

Corbyn, Jeremy

Bell, Sir Stuart

Corston, Jean

Bennett, Andrew

Cotter, Brian

Best, Harold

Cox, Tom(Tooting)

Blackman, Liz

Crausby, David

Blears, Ms Hazel

Cryer, John(Hornchurch)

Borrow, David

Cunningham, Jim(Coventry S)

Bradley, rh Keith(Withington)

Cunningham, Tony(Workington)

Bradley, Peter(The Wrekin)

Dalyell, Tam

Bradshaw, Ben

Davey, Edward(Kingston)

Brake, Tom(Carshalton)

Davey, Valerie(Bristol W)

Breed, Colin

David, Wayne

Brennan, Kevin

Davies, Geraint(Croydon C)

Brooke, Mrs Annette L.

Dawson, Hilton

Brown, rh Nicholas(Newcastle E Wallsend)

Dean, Mrs Janet

Dhanda, Parmjit

Bruce, Malcolm

Dobbin, Jim(Heywood)

Buck, Ms Karen

Dobson, rh Frank

Burnett, John

Donohoe, Brian H.

Burnham, Andy

Doran, Frank

Byers, rh Stephen

Doughty, Sue

Cairns, David

Dowd, Jim(Lewisham W)

Calton, Mrs Patsy

Drew, David(Stroud)

Campbell, Alan(Tynemouth)

Dunwoody, Mrs Gwyneth

Campbell, Gregory(E Lond'y)

Eagle, Angela(Wallasey)

Campbell, rh Sir Menzies(NE Fife)

Eagle, Maria(L'pool Garston)

Edwards, Huw

267

Ellman, Mrs Louise

Kemp, Fraser

Etherington, Bill

Khabra, Piara S.

Farrelly, Paul

Kidney, David

Field, rh Frank(Birkenhead)

Kilfoyle, Peter

Fisher, Mark

King, Ms Oona(Bethnal Green & Bow)

Fitzpatrick, Jim

Fitzsimons, Mrs Lorna

Kirkwood, Sir Archy

Flint Caroline

Knight Jim(S Dorset)

Flynn, Paul(Newport W)

Kumar, Dr. Ashok

Follett, Barbara

Ladyman, Dr. Stephen

Foster, rh Derek

Lamb, Norman

Foster. Don(Bath)

Lammy, David

Foster, Michael(Worcester)

Lawrence, Mrs Jackie

Foster, Michael Jabez(Hastings & Rye)

Laxton, Bob(Derby N)

Lepper, David

Francis, Dr. Hywel

Leslie, Christopher

Gardiner, Barry

Lewis, Terry(Worsley)

George, Andrew(St. Ives)

Liddell, rh Mrs Helen

George, rh Bruce(Walsall S)

Linton, Martin

Gerrard, Neil

Lloyd, Tony(Manchester C)

Gibson, Dr. Ian

Llwyd, Elfyn

Gidley, Sandra

Love, Andrew

Gilroy, Linda

McAvoy, Thomas

Godsiff, Roger

McCafferty, Chris

Goggins, Paul

McCartney, rh Ian

Green, Matthew(Ludlow)

McDonagh, Siobhain

Griffiths, Win(Bridgend)

MacDonald, Calum

Grogan, John

McDonnell, John

Hain, rh Peter

McFall, John

Hall, Mike(Weaver Vale)

McIsaac, Shona

Hall, Patrick(Bedford)

Mackinlay, Andrew

Hancock, Mike

McNulty, Tony

Hanson, David

Mactaggart, Fiona

Harman, rh Ms Harriet

McWalter, Tony

Harris, Dr. Evan(Oxford W & Abingdon)

McWilliam, John

Marris, Rob(Wolverh'ton SW)

Harvey, Nick

Marsden, Gordon(Blackpool S)

Havard, Dai(Merthyr Tydfil & Rhymney)

Marsden, Paul(Shrewsbury & Atcham)

Heath, David

Marshall, David(Glasgow Shettleston)

Henderson, Ivan(Harwich)

Hepburn, Stephen

Marshall, Jim(Leicester S)

Hesford, Stephen

Martlew, Eric

Heyes, David

Merron, Gillian

Hill, Keith(Streatham)

Miliband, David

Hinchliffe, David

Miller, Andrew

Hodge, Margaret

Moffatt, Laura

Holmes, Paul

Mole, Chris

Hope, Phil(Corby)

Moonie, Dr. Lewis

Hopkins, Kelvin

Moore, Michael

Howarth, George(Knowsley N & Sefton E)

Moran, Margaret

Morgan, Julie

Howells, Dr. Kim

Morley, Elliot

Hughes, Beverley(Stretford & Urmston)

Mountford, Kali

Mudie, George

Hughes, Kevin(Doncaster N)

Murphy, Denis(Wansbeck)

Humble, Mrs Joan

Naysmith, Dr. Doug

Hurst, Alan(Braintree)

Norris, Dan(Wansdyke)

Hutton, rh John

Olner, Bill

Iddon, Dr. Brian

&#x00D6;pik, Lembit

Illsley, Eric

Organ, Diana

Ingram, rh Adam

Owen, Albert

Jackson, Helen(Hillsborough)

Palmer, Dr. Nick

Jamieson, David

Pearson, Ian

Jenkins, Brian

Pickthall, Colin

Johnson, Miss Melanie(Welwyn Hatfield)

Plaskitt, James

Pollard, Kerry

Jones, Helen(Warrington N)

Pond, Chris(Gravesham)

Jones, Kevan(N Durham)

Prentice, Ms Bridget(Lewisham E)

Jones, Lynne(Selly Oak)

Jones, Martyn(Clwyd S)

Prentice, Gordon(Pendle)

Jones, Nigel(Cheltenham)

Prescott, rh John

Kaufman, rh Gerald

Price, Adam(E Carmarthen & Dinefwr)

Keeble, Ms Sally

Keen, Ann(Brentford)

Primarolo, rh Dawn

Keetch, Paul

Prosser, Gwyn

268

Pugh, Dr. John

Stuart, Ms Gisela

Purchase, Ken

Stunell, Andrew

Quinn, Lawrie

Sutcliffe, Gerry

Rammell, Bill

Taylor, Dan(Stockton S)

Rapson, Syd(Portsmouth N)

Taylor, David(NW Leics)

Raynsford, rh Nick

Taylor, Matthew(Truro)

Reed, Andy(Loughborough)

Taylor, Dr. Richard(Wyre F)

Reid, Alan(Argyll & Bute)

Teather, Sarah

Robinson, Geoffrey(Coventry NW)

Thomas, Gareth(Clwyd W)

Thomas, Gareth(Harrow W)

Robinson, Mrs Iris(Strangford)

Thomas, Simon(Ceredigion)

Roche, Mrs Barbara

Thurso, John

Rooney, Terry

Todd, Mark(S Derbyshire)

Ross, Ernie(Dundee W)

Tonge, Dr. Jenny

Roy, Frank(Motherwell)

Touhig, Don(Islwyn)

Ruane, Chris

Trickett, Jon

Russell, Bob(Colchester)

Truswell, Paul

Russell Ms Christine(City of Chester)

Turner, Dennis(Wolverh'ton SE)

Turner, Dr. Desmond(Brighton Kemptown)

Ryan, Joan(Enfield N)

Sanders Adrian

Turner, Neil(Wigan)

Sarwar Mohammad

Twigg, Derek(Halton)

Savidge Malcolm

Tyler, Paul(N Cornwall)

Sawford, Phil

Tynan, Bill(Hamilton S)

Sedgemore, Brian

Vaz, Keith(Leicester E)

Shaw, Jonathan

Vis, Dr. Rudi

Sheerrnan, Barry

Wareing, Robert N.

Sheridan, Jim

Watson, Tom(W Bromwich E)

Short, rh Clare

Watts, David

Simpson, Alan(Nottingham S)

Webb, Steve(Northavon)

Skinner, Dennis

White, Brian

Smith, rh Andrew(Oxford E)

Whitehead, Dr. Alan

Smith, rh Chris(Islington S & Finsbury)

Wicks, Malcolm

Williams, Roger(Brecon)

Smith, Geraldine(Morecambe & Lunesdale)

Willis, Phil

Wills, Michael

Smith, Jacqui(Redditch)

Winnick, David

Smith, John(Glamorgan)

Winterton, Ms Rosie(Doncaster C)

Smith, Llew(Blaenau Gwent)

Soley, Clive

Woodward, Shaun

Squire, Rachel

Woolas, Phil

Starkey, Dr. Phyllis

Worthington, Tony

Steinberg, Gerry

Wright David(Telford)

Stevenson, George

Wright Tony(Cannock)

Stinchcombe, Paul

Younger-Ross, Richard

Stoate, Dr. Howard

Tellers for the Noes:

Strang, rh Dr. Gavin

Mr. John Heppell and

Stringer, Graham

Paul Clark

Question accordingly negatived.

LORDS DISAGREEMENT AND REASON
The Lords disagree to Commons Amendment 1A to Lords Amendment 1 for the following Reason—
Because it is appropriate to make provision for no more than two pilot regions, as recommended by the Electoral Commission.
7.33 pm
The Parliamentary Under-Secretary of State for Constitutional Affairs (Mr. Christopher Leslie): I beg to move, That this House does not insist on its amendment No. lA to Lords Amendment No. 1.
Madam Deputy Speaker: With this it will be convenient to discuss the following: Government amendment (a) to Lords amendment No. 1.

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Lords amendment No. 3B—Lords Insistence and Reason—
The Lords insist on their Amendment 3 to which the Commons have disagreed, for the following Reason&#x2014;
Because it is appropriate to impose the requirements set out in the Lords amendment.
Government motion to insist on its disagreement to the said amendment.
Government amendment (a) in lieu thereof.
Mr. Leslie: Earlier today, their lordships considered again the views of the Commons expressed last Monday evening. The package of measures that we propose includes a concession to their lordships: whereas the Government and the Electoral Commission had hoped to dispense with the requirement for a second person to witness the signature of each voter with a declaration of identity, we are prepared to acquiesce to their Lordships on that particular point, and allow the witnessed signature arrangement to occur in this June's all-postal elections. I realise that that will disappoint the Electoral Commission and many hon. Members, because of worries about the efficacy of a witness signature process, but on balance—and in view of the insistence by the Lords on that point—we feel that on that matter we can compromise without overriding harm coming to the overall policy of all-postal voting. However, we remain opposed to sending expensive and wasteful receipt acknowledgements to every elector who returns a ballot paper, so we wish to delete the measure that would provide for that.
Andrew Bennett: It is a shame that we are making that concession to the Lords. What will happen to ballot papers that are returned without the declaration completed correctly? Will the returning officer give people the opportunity to correct their mistake, or will the mistake invalidate their papers?
Mr. Leslie: Owing to the insistence of their lordships, we felt that we needed to try to find consensus on the matter. I tend to agree with my hon. Friend that we would ideally have moved to a single signature arrangement, such as that which we initially set out, but their lordships clearly do not feel that we are yet ready to do that. I suspect that we will return to the matter at another time. The declaration of identity will require a witness signature, which happens under normal postal voting arrangements for postal voting on demand. In that respect, the provision is in line with existing legislation, but I think that further reform will undoubtedly be necessary.
More significantly, their lordships overturned the will of the House of Commons on the Government's intention for four regions—the east midlands, the north-east, the north-west and Yorkshire—to undertake all-postal voting. They did that despite hon. Members' vote last Monday to support the measure. I listened closely to the debate in their lordships' House, and they gave no more substantive reasons for overturning the proposal for four regions than they gave previously. The House of Commons has made its decisions on four regions before in full view of the facts, which is why I urge it to do so again.
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Four regions will make up a good pilot. It will cover a minority of the country—3l per cent.—but it will be on a large enough scale to test out new procedures effectively. Postal voting is worth trying out on that larger scale. It makes democracy easier for the public because people's opportunities to express their views are brought to their doorsteps, so electors are not expected to overcome obstacles and travel to a polling station. I understand that several noble Lords and Conservative Members occasionally say that we should not make voting more convenient, but that is a ludicrous position to take.
Mr. George Osborne rose—
Mr. Leslie: Talking of ludicrous, I give way to the hon. Gentleman.
Mr. Osborne: The Minister is belittling the arguments against including the north-west, for example, in the pilot. Does he accept that the Electoral Commission did not feel able to recommend the north-west as a pilot area? Why do the Government think that they can override the Electoral Commission?
Mr. Leslie: The hon. Gentleman should study closely what the Electoral Commission says. It is true that its definition of what forms a pilot differs from the Government's as regards the issue of scale, but it is certainly not the case that it said no to Yorkshire and the north-west. Indeed, it said that those regions in themselves were "potentially suitable"—it gave them that designation. [Interruption.] It is true that the regions were not on the Electoral Commission's top two list, which is what the hon. Member for Somerton and Frome (Mr. Heath) implies from a sedentary position, but nevertheless I hope that hon. Members will acknowledge that it recognised north-west and Yorkshire as potentially suitable and that they remain as such.
Mr. Paul Tyler: Will the Minister confirm that the Electoral Commission thought that the third region—if there was to be a third—was going to be Scotland, rather than either of the other two regions?
Mr. Leslie: It is certainly not the case that neither of the other two regions was considered. The Electoral Commission produced a grouping of regions that it deemed to be potentially suitable. As we have said many times throughout the passage of the Bill, Scotland and Scottish returning officers did not want to proceed with the process, which is why we moved down the list. Yorkshire and the north-west came next on the list, so we followed the Electoral Commission's ranking in the light of the views of experts, administrators and regional returning officers. I hope that the hon. Gentleman will acknowledge that as a relatively logical process.
Mr. Osborne: The experts at the Electoral Commission said, on 4 March, that they
"felt unable to make a positive recommendation in respect of those regions"&#x2014;
that includes the north-west—
"having assessed their suitability against the guidelines we have applied."

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Why is the Minister overriding them?
Mr. Leslie: If the hon. Gentleman reads further the letter sent to me by the commission's chairman, he will see the sentence:
"We named a further four regions that were potentially suitable as pilots."
Mr. Osborne: Potentially suitable.
Mr. Leslie: Yes, potentially suitable, as I said to the hon. Gentleman. He cannot in any way suggest that the Electoral Commission had not said that Yorkshire and the north-west were somehow not potentially suitable.
Mr. Chris Mole: Does the Minister accept that the evidence given by the regional returning officer for Yorkshire and Humberside to the Select Committee's current inquiry asserted that the worst that could happen now would be for the Government to change their mind about the pre-planning for the elections, because the local authorities are not a position to return to a traditional approach to voting in this election?
Mr. Leslie: It is indeed the case that, increasingly, returning officers in the north-west, Yorkshire, the east midlands and the north-east are saying that they want to proceed with all-postal voting. That is the view of the administrators on the ground, and they not only want the Government to sustain that position; they want Parliament to sustain it. That is what I am asking the Commons to agree to tonight.
We know for a fact that more people will participate in all-postal voting. What can be wrong with that? Surely it is right and proper that we take steps to encourage wider participation. That is the responsible path to take if we are to reinvigorate our democratic process.
Mr. Gerald Kaufman: I just want to clarify something because I may have got the wrong end of the stick—it would not be the first time. When my hon. Friend was speaking to the motion on the amendment and announcing the change regarding witnesses which my hon. Friend the Member for Denton and Reddish (Andrew Bennett) deplored, did he say that the matter on which the Government were now giving way to the Lords was something that the Electoral Commission wanted?
Mr. Leslie: My right hon. Friend is entirely right. The commission advised Parliament and the Government that it would prefer to move away from the process of the declaration-of-identity witness signature towards a single-signature arrangement. It is a pity that the Opposition parties, in collusion in the other place, have been determined to push that point, but we do not feel that it is at the core of the Bill, and we have reluctantly decided to concede on it.
Mr. Kaufman: Having given that explanation, which confirms what I thought I heard, will my hon. Friend
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explain how even the heights of hypocrisy which both the Conservatives and the Liberal Democrats can reach—they are heights with no ceiling—allow them to reconcile their demand that we abandon something that the Electoral Commission wanted with them giving as their reason for insisting on the amendment the fact that the commission wanted something? Just what kind of creeps are these people?
Mr. Leslie: I am not sure that I can answer that last question in parliamentary terms, but I agree that even the sky is not the limit when it comes to the double standards and inconsistency in the arguments pursued by other parties. When the commission's advice suits them, they will uphold it; when it does not suit them, they will not uphold it.
If the Opposition parties recognise the arrangements that are in place, they will see that the Electoral Commission is there to advise, but ultimately Government and Parliament have to make the final decisions. We make decisions in full cognisance of the advice that is available to us but also with an eye to the fact that we are accountable to those who elect us, unlike, of course, those in the other Chamber.
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On the issue of scale, which concerned Members in the other place, it would be perverse to ignore the plans for October's all-postal referendum on elected regional assemblies—indeed, the Electoral Commission supports all-postal voting—so proceeding in the north-west, the north-east and Yorkshire clearly makes good sense. We have answered questions and made proposals to placate worries about fraud, and the Electoral Commission, the returning officers and the police are all keen to work together to make all-postal voting a success. Extensions of the offence of personation have been included in the Bill, and election officials have other new powers to crack down on any hint of malpractice. It is extremely odd that Opposition parties in the Lords should say in the same breath that they are prepared to see all-postal voting in two regions, but not in a further two. All the queries raised have been about the system and nature of postal voting, including specious worries about fraud, which can be answered and ameliorated satisfactorily. That is entirely different from suggesting that a greater problem is presented by having four regions as opposed to two. If their lordships thought that the arrangements for all-postal voting were unsafe, why are they happy with two regions but not three or four? Scale presents few issues or problems, yet their lordships failed to address that question.
All-postal voting in only two regions could result in fewer people voting by post than was the case in the last round of local election pilots in 2003—a backward step which would be inexplicable to the many members of the public who are keen on all-postal voting. There is little more to be said about the matter, as the House of Commons has expressed its view, and should do so again tonight. By delaying the Bill, their lordships are jeopardising the crucial preparation period before elections. Returning officers need time to prepare, contract and put their plans in place, and they have asked Parliament to make a decision now on which regions will go ahead. By supporting the proposals, the

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House of Commons can reiterate its strong view that four regions need to proceed. I therefore commend the proposals to the House.
Mr. Nick Hawkins: Cracks in the Government edifice have started to appear with the first Government concession. Although it is welcome, it does not go nearly far enough, and the Minister, as usual, has tried to skate over the Electoral Commission's true view. Only a few days ago, in the Chamber, we referred to a letter to him from Sam Younger, the chairman of the Electoral Commission, who, I remind him, said that
"it does not follow that the Commission would be unconcerned about the number of pilot regions. As I have mentioned, we expected the Government to nominate three regions and were surprised to learn that the Bill was to be amended to name four regions."
That is about as strongly worded as letters to Ministers get—[Interruption.] The Deputy Prime Minister is chuntering. Throughout our debates we have mentioned the unseen hand of the Deputy Prime Minister, who was determined to get his own way about Yorkshire and Humber. He has been working by remote control to try to persuade the Electoral Commission of the Government's case. Finally, he is here in person tonight, and is openly blustering about wanting to get his way, as he always tries to do. Fortunately, we have a bicameral legislature. The upper House is entitled to express its view, and we want to support its sensible warnings about fraud and the dangers of involving half the country in postal pilots. It will come as no surprise to the House that the Opposition remain entirely unconvinced by the arguments the Minister has expressed again tonight for piloting in four regions.
There are two fundamental reasons why we and the other place must stand firm. First, it is irresponsible to operate a so-called pilot scheme in nearly half of England. Almost half the regions will hold combined European parliamentary and local elections in June, when pilot schemes should be designed to generate evidence on a system of voting that is new, innovative and by no means guaranteed secure. The independent Electoral Reform Society has said, as the Minister is well aware, that for the first time in 130 years there is an opportunity, sadly, for large-scale electoral fraud.
Mr. Ronnie Campbell: There was a pilot scheme during the last local elections in my constituency, Blyth Valley. When I asked the returning officer afterwards how it went, he said he was amazed at how correct the ballot was and at the fact that there was little, if any, fraud.
Mr. Hawkins: That is not the experience of many who spoke in the previous debates on this—[Interruption.] The Deputy Prime Minister continues to shout from a sedentary position. I refer him to the detailed speeches of the noble Lord Greaves in several debates about wholesale fraud in various areas—
Several hon. Members rose—
Mr. Hawkins: —particularly the north-west—
Madam Deputy Speaker: Order. The hon. Gentleman was not giving way at that point. He clearly is now.
Mr. David Watts: I am grateful to the hon. Member for Surrey Heath (Mr. Hawkins). Will he refer to the commission's report on the pilot schemes that were conducted both in my own constituency and in that of my hon. Friend the Member for Blyth Valley (Mr. Campbell), and acknowledge that the report indicated that there was no evidence whatever that fraud had been committed? Will he deal with that specific point? I cannot see that he is providing any evidence to justify his claims.
Mr. Hawkins: I can certainly respond to the hon. Gentleman. The Electoral Commission's own report on the matter raises concerns about fraud, specifically in relation to the north-west. The commission points out that there may well be criminal trials arising from some of the pending allegations, and some of those trials might coincide with the forthcoming elections. That was one of the reasons why the commission was so concerned about the north-west.
Mr. William Cash: I heard the Deputy Prime Minister shouting across the Floor of the House, "Where's the evidence?" I am sure he is acquainted with the Alden committee report relating to Birmingham, which has a Labour council. I shall refer to that later, if I catch Madam Deputy Speaker's eye. I should be very surprised if the Deputy Prime Minister does not know about that report, in which Mr. Alden stated that matters had become so bad that the rules that exist in Northern Ireland had to be applied, and the police went on to say that the postal voting system had few major checks or controls. The situation in Birmingham at the time was a scandal, and I am surprised that the Deputy Prime Minister does not seem to be aware of it.
Mr. Hawkins: I am grateful to my hon. Friend.
Madam Deputy Speaker: Order. Before the hon. Gentleman replies, I would prefer this short debate to be conducted in an orderly manner, without Members on either side shouting from sedentary positions.
Mr. Hawkins: I am grateful for that, Madam Deputy Speaker. The Government are showing that they wish to ignore the advice of their own creation, the Electoral Commission, which was able to recommend unequivocally only two pilot areas. It has done the research. During the debates in another place, Lord Greaves highlighted specific problems in the two regions that the Government are seeking to insist on, where there are serious concerns about fraud, electoral malpractice and intimidation. I refer hon. Members to columns 12 to 18 of 26 January in another place. I also refer hon. Members to what Lord Greaves said in the debate this afternoon, when he repeated his concerns.
Andrew Bennett: Will the hon. Gentleman separate two issues? There has been some evidence of fraud under the existing postal vote system, but that will apply whatever we decide tonight. However, there is no evidence of fraud in the pilot. There is a strong argument that if there is a high turnout, which we could get as a result of postal ballots, any fraud will become much less significant.
Mr. Hawkins: That point simply does not deal with the fact that on this issue, in relation to these pilots, the

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Electoral Commission is recommending against the two extra areas that the Government want to include. One of the concerns that the commission raises specifically is fraud in relation to the north-west.
Mr. Leslie: The hon. Gentleman says that the Electoral Commission recommended against the north-west and Yorkshire. Is he absolutely sure that that is a correct representation of the Electoral Commission's view?
Mr. Hawkins: As the Minister knows full well, we have said that the Electoral Commission was able unequivocally to recommend only two regions. The Government are ignoring their own Electoral Commission's recommendations. The Government are insisting on these four pilot regions for their own reasons. The Minister in another place, Lord Filkin, made it perfectly clear that he does not believe that the clearly-evidenced lack of enthusiasm of regional returning officers or the possibility of malpractice should be any impediment to piloting the all-postal schemes in the two additional areas. The Electoral Commission clearly begs to differ, as Sam Younger's recent letter to the Minister makes absolutely clear. We remain absolutely adamant that only the two regions unequivocally recommended by the Electoral Commission—the north-east and the east midlands—should be pilots.
Mr. Watts: May I point out that the overwhelming view of people in the north-west, as received in representations, is support for the idea of all-postal ballots? Will the hon. Gentleman deal with my original point? Can he give us any evidence of fraud and tell us whether any prosecutions are going ahead as a result of the pilot schemes that were launched in the north-west and in other areas?
Mr. Hawkins: I dealt with that point in my earlier answer to the hon. Gentleman. If he reads the Electoral Commission's report, he will find that it deals specifically with the concerns about possible fraud that were so adequately set out by Lord Greaves, who has extensive experience of elections in the north-west. That is further evidence of why the Electoral Commission is right.
Mr. Cash: Does my hon. Friend accept that the real issue often turns on the electoral roll? A serious problem has arisen in that context. Far too many people are going on to the electoral roll, which appears to have some connection with the latest immigration problems.
Mr. Hawkins: I very much agree with my hon. Friend.
Given that these are pilots—experimental trial schemes—it seems sensible to have them only in the two regions where the Government's own Electoral Commission is confident about using the all-postal scheme, and where all the regional returning officers support it and there are no fears about fraud. If the pilots are successful, next time round more enthusiasm and confidence might be expressed by regional returning
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officers in areas where they have not been confident in the past; then, perhaps, the all-postal system could be widened.
I welcome the Government's concessions on houses in multiple occupation. They have not gone far enough, but they are at least recognising some of the arguments that were advanced by Opposition Members here and in another place.
We feel that the Government are taking an unjustifiable risk by insisting on four pilot regions against the recommendation of the Electoral Commission, which, as Sam Younger's letter makes clear, is still concerned about that. It is vital to balance any plans that the Government have for innovation against the security and safety of our democratic process. We welcome the Government's small concession, but they have not gone far enough. We shall continue to maintain our position and to vote against their continuing attempts to impose this measure.
Mr. Kaufman Mr. Kaufman: I elicited from my hon. Friend the Minister the fact that the House of Lords is insisting on excluding these two regions because, in the contention of the Opposition, the Government are going against the wishes of the Electoral Commission; but there were cheers from the Liberal Democrat Benches when my hon. Friend said that he was going to make a concession that went against the wishes of the Electoral Commission. What we get from that rabble opposite—or those several rabbles opposite—is not honest, open, clear reasons for opposing the measure, but asventitious excuses to avoid something that they do not want to happen. They do not want to give more people more opportunities to vote in elections that they are scared of losing. They want as few people as possible to vote—[Interruption.] The hon. Member for Tatton (Mr. Osborne) jeers, but it would be very diffecult for the Conservative vote in my constituency to get any lower than it is. It has almost disappeared there, althought there is still just a little scope for further reduction.
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Mr. George Osborne rose—
Mr. Kaufman: I shall give way in a moment.
Let us be clear about this. My hon. Friend the Minister is right when he says that the pilot scheme is wanted overwhelmingly in the north-west. That has been made absolutely clear by my constituents and those of many other hon. Members.
Shona Mclsaac: Is my right hon. Friend aware that one of the Liberal Democrat Euro MPs in his region, Mr. Chris Davies, has stated his reason for opposing the all-postal ballot? It is:
"Automatic postal voting is designed solely for those too lazy to make the effort."
Does not that reveal the Liberal Democrats' true colours?
Mr. Kaufman: One never knows what the Liberal Democrats' true colours are, because they vary from street to street. If they could get away with it, they would

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vary from house to house. The fact is that this Chris Davies—who was, happily, booted out of this place and found a haven in the European Parliament—has said that postal voting is for lazy voters. My constituents will be told, whether they get the pilot scheme or not, that the Liberal Democrats believe that if they want postal votes they are lazy voters. But let me tell the House something else. If the pilot scheme goes ahead in the north-west, the Liberal Democrats—certainly those in Manchester—will claim that they fought for it all along and really wanted it. They will tell everyone what a marvellous privilege it is for the voters to get what the Liberal Democrats have been seeking to get for them.
The hon. Member for Surrey Heath (Mr. Hawkins) talked about fraud. We in the Gorton constituency are well accustomed to what fraud is. We are well accustomed to the Liberal Democrats claiming that they got £120,000 for the Anson Cabin project, when in fact I got it with the assistance of my right hon. Friend the Prime Minister. In Gorton, we are accustomed to lies, cheating, hypocrisy and misrepresentation at that level, from that rabble. As I have said, if we prevail tonight and get the pilot scheme, the Liberal Democrats will say that they wanted it, that they love it and that it is the best possible way of proceeding in our local and European elections on 10 June.
Mr. David Borrow: Does my right hon. Friend agree that my constituents will find it difficult to understand why money should be invested in running a postal ballot for the referendum on a regional parliament in the autumn of this year, if a similar investment cannot be made in June for the European elections? It would seem sensible to my constituents that one lot of investment should be used for two elections.
Mr. Kaufman: My hon. Friend is absolutely right.
Let us be clear about this. What we are seeing from the two Opposition parties is not a consistent, honourable approach to elections. They want as few people as possible to vote, because the only way that they win council elections is on very low polls.
Mr. Osborne: Will the right hon. Gentleman confirm that the Conservative MPs in the north-west—and probably the Liberal Democrat MPs as well—had the highest turnouts in their constituencies at the general election, and that the Labour MPs had the lowest? The hon. Member for Liverpool, Riverside (Mrs. Ellman) had the lowest in the country. I dare say that the turnout in Gorton was pretty low, too.
Mr. Kaufman: But it is quality. When I was first elected to the House of Commons in 1970, the Conservatives got 10,000 votes from an electorate of 43,000. In 2001, they got 2,700 votes from an electorate of 67,000. In the local elections in Manchester, the Conservatives are hard put to it in my six wards to get into four figures. They are afraid, just as the Liberal Democrats are afraid, that they will be found out if people get the opportunity to vote in large numbers. Well, they are being found out tonight.
I recommend that my right hon. and hon. Friends insist on this. I quite understand why my right hon. Friend the Deputy Prime Minister believes that
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Yorkshire and Humberside should be included and I say this to the hon. Member for Surrey Heath: if he believes that there are huge opportunities for fraud in these postal ballots, he should not be saying that we can have two rather than four. He should be saying that there should be none, but he dare not say that. I will acquit him of inconsistency in one matter—namely, he possibly believes what he is saying. I do not give that to the other party.
Mr. David Heath: One of the misfortunes of these occasions is that it is almost impossible to put any new arguments on such matters once they have been debated at length in the House and in another place. We have heard no new arguments from the right hon. Member for Manchester, Gorton (Mr. Kaufman), who seems to have taken a bitter pill before arriving in the Chamber. He showed no evidence whatever of having read the Electoral Commission's report before commenting on it, which is a cause of great sadness.
Mr. Kaufman: On a point of order, Mr. Deputy Speaker. You will be aware, as will the hon. Member for Tiverton and Honiton (Mrs. Browning), that I am a member of the Speaker's Committee on the Electoral Commission. The Electoral Commission sends me all its documents for careful perusal.
Mr. Deputy Speaker: The right hon. Gentleman is experienced enough to know that that is not point of order and, equally, experienced enough to know that he has got it on the record.
Mr. Heath: As I said, there is no evidence that the right hon. Gentleman has read the Electoral Commission's report, which is perhaps worth repeating. Let me get away from that to say that I welcome the Government's move in incorporating at least some of the changes recommended in another place in terms of declaration of identity. That is helpful. It means that we do not have two different systems applying in terms of postal votes, whether in respect of these pilots or every other election happening on the same day, at the same time and in the same way. That seems to me to be sensible, up to the point where we have the improvement recommended by the Electoral Commission, which I wholeheartedly support and which involves a pre-signature system.
Mr. Watts: Will the hon. Gentleman give way?
Mr. Leslie rose&#x2014
Mr. Heath: I shall give way to the Minister in a moment. The pre-signature system will provide for better voter identification, but it clearly cannot be in place for these elections. We hope, however, that it will be for future elections.
Mr. Leslie: The hon. Gentleman has acknowledged that the Government are reluctantly conceding on the declaration of identity, but will he also acknowledge that we are conceding that—something he has been pressing for—in the face of the advice from the Electoral

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Commission? Does he think it right that we can take advice from the Electoral Commission but perhaps not necessarily act on every single piece of advice from it?
Mr. Heath: The Minister has the difficulty of arguing two contrary positions—apparently accepting what he says is the Electoral Commission's advice on the one hand while, on the other, rejecting it entirely.
I take what is, I hope, a more pragmatic and sensible view: I agree with the Electoral Commission's intention, which is clearly stated in its important document as to where it wants to get to. We do not think that we are there yet; the Minister knows perfectly well that we are not there yet. We have a holding position until the next election, when, I hope, we will have a proper system for pre-registration of voters, which will eliminate the potential for fraud in that area without our having the rather cumbersome system that none of us wants.
Mr. Watts: The hon. Gentleman seems concerned not to cause confusion among the electorate. Voters in St. Helens have already used a postal ballot. They will be asked to participate in a traditional ballot twice, then go back to a postal ballot. If that is not confusing, I do not know what is—and it is exactly what the commission's report said should be avoided.
Mr. Heath: The hon. Gentleman makes his intervention at entirely the wrong point, on a matter that I have not yet addressed. Nevertheless, I will answer his point. Exactly the same argument could just as easily be made by me, in pursuit of my constituents' interests. They had an all-postal ballot for South Somerset district council but will be prohibited by the legislation that the hon. Gentleman is supporting this evening from an all-postal ballot in the European elections.
Mr. Watts rose—
Mr. Heath: Let the hon. Gentleman listen. I have said all along that one should either have a pilot scheme that enables one to address some of the outstanding issues or a UK-wide postal ballot—in which I personally can see some merit.
The Government propose neither. They say, "We will not have a proper pilot scheme because we will not have the two regions that the commission proposed. We will poll the whole north of England. Anybody north of the Trent will have an all-postal ballot. Anybody south of the Trent will be prohibited." Where is the logic for the constituents whom many of us seek to represent?
If the Government had said they wanted a UK-wide, all-postal ballot, we would have raised exactly the same concerns about the potential for personation and fraud but at least there would have been some logic. There is no logic in the Government having a pilot scheme that is not a pilot scheme and determining a region that constitutes half the local authorities in England—saying that an all-postal ballot is not available for the other half. Neither will one be available to Scotland, despite the fact that it was the runner-up in the Electoral Commission report, or Wales. It was not even
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considered for south-west England because of the addition of Gibraltar—which apparently is a prohibitive factor in an all-postal ballot.
Every argument advanced by the Government has been turned on its head in the next breath—they have been arguing in two directions at once. They know that this development is in the interests of political expediency and nothing else; otherwise, they would look for a pilot scheme or a UK-wide election. After all, we are talking about a single national campaign in which half the electorate will go the polls two or three weeks before the rest of the country. They will watch the same television programmes and see the same campaign unfolding.
Mr. Michael Connarty: The hon. Gentleman prays in aid the situation in Scotland. He obviously does not take into account the fact that electoral registration officers in Scotland said that they could not cope. Although Scotland was possibly recommended, the electoral officers were the barrier more than anything else. That was not a matter of political choice but dictated by the logistics of the exercise.
Mr. Heath: The hon. Gentleman adduces an argument which in other debates was hotly contested by his right hon. and hon. Friends, who said that that claim was absolute nonsense and that the particular returning officer who gave that indication did not represent the advice of returning officers across Scotland. They said that Scotland had come third and was entitled to the opportunity to engage in this great experiment.
Mr. Watts rose—
Mr. Heath: I have already given way to the hon. Gentleman. The Government plucked two English regions out of the air—
Mr. Leslie: Not out of the air.
Mr. Heath: They were not positively recommended by the Electoral Commission. I accept that they were listed as having potential, which was not realised. I have potential to open the batting for England, which has not been realised yet and is unlikely to be realised in the immediate future. Nevertheless, the Government have chosen to take that line.
There were arguments of the Government's own devising for not including those regions in the pilot scheme: the number of local authority elections on that day, the complexity of the region, and the potential difficulties—they are no more than potential difficulties—of fraud. The hon. Member for Denton and Reddish (Andrew Bennett) made the point that the potential for fraud is diluted because it is such a large area. Of course, he is absolutely right in terms of the European parliamentary elections. At the same time, however, every single person voting in European parliamentary elections also votes in wards in local authority elections. That is where the potential mischief applies and where we must tread carefully if we are to maintain the integrity of the voting system.

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8.15 pm
I believe that the Government have made an important concession this evening, and it is the first of two concessions that they will make before the end of this week—[Interruption.] I hear the comment from the Labour Benches that that is not so. We shall see. I believe that they will be forced to recognise that the Electoral Commission's advice on determining what areas should be available is not to be swept aside for political convenience, and not to be arbitrarily ignored. I believe that we will come to a satisfactory conclusion. We are only halfway there this evening. I suspect that we will conclude the business when this matter has been debated one more time in another place, and we shall all return believing that we have done a good job in improving this legislation.
Mr. Andrew Miller: I will be brief, as I understand that other Members wish to speak.
I want to develop the point that was first raised by my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman). Undoubtedly, there is a contradiction in the position being adopted by the collective Opposition. On the one hand, it is all right to overturn the advice of the Electoral Commission on the issue of signatures, but on the other, it is not all right on the issue of postal votes. The only aspect of my right hon. Friend's contribution with which I disagreed was that he minced his words so much in his criticism of the Opposition, and particularly of the way in which the Liberal Democrats have two stances. That was revealed in response to the intervention of my hon. Friend the Member for Cleethorpes (Shona Mclsaac) in which she referred to quotes from a Member of the European Parliament, Mr. Chris Davies, who purports to represent my constituency, too. That particular individual argues against postal ballots on the basis that it is a provision for lazy voters—he does not consider elderly people, shift workers, including many of my constituents, elderly people, people with families and so on.
Ms Dari Taylor: Does my hon. Friend accept that the reason why the Opposition parties welcome the fact that the other place has thought that the north-west and Yorkshire and Humber should not be included in the pilots is that the high turnout will mean that Labour votes are expressed and recorded, and Labour local authorities and Labour Governments elected? That is manipulation coming directly from the other place.
Mr. Miller: My hon. Friend makes a point a behalf of her constituents, whom she represents extremely well.
I want to return to my point about the quotes from that Member of the European Parliament. At least he has some legitimacy, albeit under the bizarre list system, in my constituency. Unlike those at the other end of the Corridor, I was elected to represent Ellesmere Port and Neston. I suppose Chris Davies has some legitimacy in that respect as an MEP, but not a single vote is cast for anyone at the other end of the Corridor. Yet I understand that, by a vote of 174 to 130 dominated by
282
the hereditaries, the will of this House*#x2014;the will of the people who sent me here to represent Ellesmere Port and Neston—has been overturned.
Mr. Watts: Does my hon. Friend agree that what is missing from the debate is the issue of what the voters want? It has been shown that when a postal vote is held, double the number of people—
Mr. Deputy Speaker: Order. The hon. Gentleman should be addressing the Chair, not his hon. Friend.
Mr. Watts: I apologise, Mr. Deputy Speaker. Is my hon. Friend aware that the turnout is doubled when a postal vote takes place? When a Liberal Democrat Member says that this is about lazy voters, he is actually accusing half the voters of being lazy.
Mr. Miller: My hon. Friend makes his point eloquently. His constituency has been subject to one of the pilots, as has Chorley in the north-west. I have examined the statistics carefully, because I am interested in alternative ways of voting. I have investigated other systems such as electronic voting Although that system benefited the Conservative party in Vale Royal, I am in favour of it. I think it would be very short-sighted of us not to look for new opportunities to enfranchise people in all our communities.
Mr. Cash: The hon. Gentleman mentioned the remarkable result in Chorley, where a postal ballot system increased the turnout from 31 per cent. in 1998 to 61 per cent. How does he explain the fact that the turnout dropped by 0.4 per cent. in Greenwich and by 3 per cent. in Hackney under the same system?
Mr. Miller: I think there are special circumstances that we should examine in all the pilots we undertake, but 1 also think the Greenwich pilot was far too small for us to make any statistical sense out of the data. I should be happy to debate the point with the hon. Gentleman elsewhere.
My constituents in the north-west undoubtedly want more opportunities to vote. People who work difficult shifts in the chemical and vehicle-building industries in particular often find that that they must either rush to the ballot box after a 12-hour shift or miss their opportunities. Tremendous strides have been made in the recent past in removing some of the constraints preventing people from having postal ballots. I think we should agree, in the interests of those people and the other sections of society that I mentioned earlier, that it is utterly irresponsible of the Lords not to allow the will of the people of my constituency and of this House to prevail.
Mr. Cash: One of the biggest problems involved in the whole question of postal voting is the background to the reasons why people want the turnout to increase. According to a recent opinion poll connected with the approaching European elections, it was stated that no more than 19 per cent. of the people of this country would participate. We know that in the last European elections the turnout was only 24 per cent., and I believe that in one part of the north-west—Liverpool, I think—it was only 9 per cent.

283
There is a serious problem. This is a democratic question, and it is also about whether or not politics and politicians in general inspire confidence. We have discovered that, as a result of what has happened in the last few years, confidence in the electoral system has fallen further and further. Indeed, the average turnout in general elections between 1945 and 1997 was approximately 73 per cent., but between 1997 and 2001 there was an astonishing drop of 12 per cent. People in this country certainly need to take account of the fact that this is not just a question of the technicalities that can be applied by increasing the number of people who vote by post. There is a much deeper crisis about our democracy as a whole, which is clearly demonstrated by the figures that I gave for the period 1997 to 2001. It is clear that it is directly connected to the atmosphere of dishonesty, to which the Government have contributed by the way in which they have gone about what they have done.
Andrew Bennett: Will the hon. Gentleman go back over those figures and relate them to how close the public perceived the election to be? Turnout almost every time went up when people thought that it was going to be a close contest.
Mr. Cash: I am not against the idea of postal votes. That is something on which we ought to agree on both sides of the House; I am sure we do. I am speaking for myself here. I am deeply encouraged by the fact that in Chorley, as I said, there was an increase in turnout from 31 per cent. in 1998 to 61 per cent. in 2002. That cannot be anything but a good thing because it is people participating in the democratic process, but the problem is that that is not mirrored throughout the country.
I have to take the point that the hon. Member for Somerton and Frome (Mr. Heath) made, which is simple but none the less valid. We are going to have elections that will affect the outcome in the European Parliament and thereby, because of the power of co-decision, have a vast impact not only on this House but on our electorate, because the power of co-decision is a power equivalent to that of voting in the Council of Ministers. Therefore, we should be taking the matter extremely seriously, and I am sure we are. The point that the hon. Gentleman made that there should be consistency throughout the country is important. In the areas that are disputed in the amendment and in the northern part of the country in broad terms, why should a system be put in place that differentiates sharply from the position in the south? I am afraid that I cannot—
Several hon. Members rose—
Mr. Cash: I will certainly give way. I cannot conceive of any reason for that. I am happy to give way to the hon. Member for Cleethorpes (Shona Mclsaac), not the right hon. Member for Manchester, Gorton (Mr. Kaufman).
Shona McIsaac: Does not the hon. Gentleman acknowledge that, in the Yorkshire and Humber region, there is to be a referendum in October that returning
284
officers are preparing for? Many parts of that region had postal vote elections last year. To go back to the traditional way of voting in June will be a backward step, because the majority of people who have had postal votes already assume that they can vote in that way in June. In fact, his own party in my area is already promoting that fact on its website.
Mr. Cash: That is a perfectly fair debating point. I think that we should be taking the whole question—
Shona McIsaac: Answer.
Mr. Cash: Wait a minute. I am not saying that I necessarily agree with that point but it is a perfectly fair point to make. What I am saying is that we should be taking the matter extremely seriously. This may be a truncated debate and our time may run out—my time in particular may run out very soon—but in terms of what is at stake this is a central question for the future of democracy in this country. We had better get this right.
The Deputy Prime Minister was ranting on and asking for the evidence, so I quoted the Alden committee report, which is really very instructive. The Labour council had the good sense to appoint a Conservative city councillor whom they greatly trusted to lead the investigation.The Birmingham Post quoted John Alden as saying that until he had completed his investigation, he had not realised how serious the perversion of democracy had become. That is in relation to postal voting, personation and intimidation at polling stations in Birmingham.
Mr. Watts: is the hon. Gentleman aware that what he is referring to is in relation not to all-postal voting but to traditional voting? He seems to be advocating doing away with all postal voting in any circumstances.
Mr. Cash: I am not advocating that. The hon. Gentleman heard me just now saying that I could see advantages in postal voting systems, provided that they are free of the perversion of democracy that John Alden identified. I am glad to see the Minister nodding at that. We have been round this track before, and I feel strongly about the need to ensure that we have a proper voting system. The more people who participate, the better. Indeed, the issue of the European elections will become increasingly important because, to my great concern, more and more power in law making is being transferred upwards, in what I believe is an undemocratic way. If we are to have a European Parliament, let us for heaven's sake have a system that cannot be perverted as in the case identified in the Alden committee report.
The Electoral Commission recommended that all-postal voting should become the norm for local elections, but there are concerns about ballot security. It said that investigations into previous postal voting had been both piecemeal and inadequate. What reliable evidence there is suggests that the scope for abuse is wider than the Government might care to admit.

285
In addition to the problem of fraud, there are concerns about voter confidentiality—
It being one hour after the commencement of proceedings, MR. DEPUTY SPEAKER put forthwith the Question already proposed from the Chair, pursuant to Order [8 March].
Question agreed to.
MR. DEPUTY SPEAKER then proceeded to put the Question necessary to dispose of the business to be concluded at that hour.
Question put, That amendment (a) in lieu of Commons Amendment No. 1A, be made:—
The House divided: Ayes 274, Noes 152.
Division No. 95]
[8:34 pm

AYES

Abbott, Ms Diane

Curtis-Thomas, Mrs Claire

Ainsworth, Bob(Cov'try NE)

Dalyell, Tam

Allen, Graham

Darling, rh Alistair

Anderson, rh Donald(Swansea E)

Davey, Valerie(Bristol W)

Atherton, Ms Candy

David, Wayne

Atkins, Charlotte

Davidson, Ian

Austin, John

Davies, Geraint(Croydon C)

Bailey, Adrian

Dawson, Hilton

Baird, Vera

Dean, Mrs Janet

Banks, Tony

Dhanda, Parmjit

Barnes, Harry

Dobson, rh Frank

Battle, John

Donohoe, Brian H.

Beard, Nigel

Doran, Frank

Beckett, rh Margaret

Dowd, Jim(Lewisham W)

Bennett, Andrew

Drew, David(Stroud)

Best, Harold

Eagle, Angela(Wallasey)

Blackman, Liz

Eagle, Maria(L'pool Garston)

Blears, Ms Hazel

Edwards, Huw

Blizzard, Bob

Ellman, Mrs Louise

Borrow, David

Etherington, Bill

Bradley, rh Keith(Withington)

Ewing, Annabelle

Bradley, Peter(The Wrekin)

Farrelly, Paul

Bradshaw, Ben

Field, rh Frank(Birkenhead)

Brennan, Kevin

Fisher, Mark

Brown, rh Nicholas(Newcastle E Wallsend)

Fitzpatrick, Jim

Fitzsimons, Mrs Lorna

Browne, Desmond

Flint, Caroline

Buck, Ms Karen

Flynn, Paul(Newport W)

Burnham, Andy

Follett, Barbara

Caborn, rh Richard

Foster, rh Derek

Cairns, David

Foster, Michael(Worcester)

Campbell, Alan(Tynemouth)

Foster, Michael Jabez(Hastings & Rye)

Campbell, Ronnie(Blyth V)

Caplin, Ivor

Foulkes, rh George

Caton, Martin

Francis, Dr. Hywel

Cawsey, Ian(Brigg)

Gardiner, Barry

Challen, Colin

George, rh Bruce(Walsall S)

Chapman, Ben(Wirral S)

Gerrard, Neil

Chaytor, David

Gibson, Dr. Ian

Clark, Mrs Helen(Peterborough)

Gilroy, Linda

Clark, Dr. Lynda(Edinburgh Pentlands)

Godsiff, Roger

Goggins, Paul

Clark, Paul(Gillingham)

Griffiths, Win(Bridgend)

Clelland, David

Grogan, John

Coaker, Vernon

Hain, rh Peter

Coffey, Ms Ann

Hall, Mike(Weaver Vale)

Connarty, Michael

Hall, Patrick(Bedford)

Corbyn, Jeremy

Hanson, David

Cousins, Jim

Harman, rh Ms Harriet

Cox, Tom(Tooting)

Havard, Dai(Merthyr Tydfil & Rhymney)

Cranston, Ross

Cruddas, Jon

Healey, John

Cryer, John(Hornchurch)

Henderson, Ivan(Harwich)

Cunningham, Jim(Coventry S)

Hepburn, Stephen

Cunningham, Tony(Workington)

Heppell, John

286

Hesford, Stephen

Morgan, Julie

Heyes, David

Morley, Elliot

Hill, Keith(Streatham)

Mountford, Kali

Hinchliffe, David

Mudie, George

Hope, Phil(Corby)

Mullin, Chris

Hopkins, Kelvin

Murphy, Denis(Wansbeck)

Howarth, George(Knowsley N & Sefton E)

Murphy, Jim(Eastwood)

Naysmith, Dr. Doug

Hughes, Beverley(Stretford & Urmston)

Norris, Dan(Wansdyke)

Organ, Diana

Hughes, Kevin(Doncaster N)

Osborne, Sandra(Ayr)

Humble, Mrs Joan

Owen, Albert

Hurst, Alan(Braintree)

Palmer, Dr. Nick

Iddon, Dr. Brian

Pearson, Ian

Illsley, Eric

Pickthall, Colin

Ingram, rh Adam

Plaskitt, James

Jackson, Helen(Hillsborough)

Pollard, Kerry

Jamieson, David

Pond, Chris(Gravesham)

Johnson, Miss Melanie(Welwyn Hatfield)

Pope, Greg(Hyndburn)

Prentice, Ms Bridget(Lewisham E)

Jones, Helen(Warrington N)

Jones, Kevan(N Durham)

Prentice, Gordon(Pendle)

Jones, Lynne(Selly Oak)

Prescott, rh John

Jones, Martyn(Clwyd S)

Price, Adam(E Carmarthen & Dinefwr)

Kaufman, rh Gerald

Keeble, Ms Sally

Primarolo, rh Dawn

Keen, Ann(Brentford)

Prosser, Gwyn

Kemp, Fraser

Purchase, Ken

Kennedy, Jane(Wavertree)

Quinn, Lawrie

Khabra, Piara S.

Rammell, Bill

Kilfoyle, Peter

Raynsford, rh Nick

King, Ms Oona(Bethnal Green & Bow)

Reed, Andy(Loughborough)

Robertson, Angus(Moray)

Knight, Jim(S Dorset)

Robinson, Geoffrey(Coventry NW)

Kumar, Dr. Ashok

Ladyman, Dr. Stephen

Roche, Mrs Barbara

Lammy, David

Rooney, Terry

Lawrence, Mrs Jackie

Ross, Ernie(Dundee W)

Laxton, Bob(Derby N)

Roy, Frank(Motherwell)

Lazarowicz, Mark

Ruane, Chris

Lepper, David

Russell, Ms Christine(City of Chester)

Leslie, Christopher

Levitt, Tom(High Peak)

Ryan, Joan(Enfield N)

Lewis, Terry(Worsley)

Salmond, Alex

Liddell, rh Mrs Helen

Sarwar, Mohammad

Linton, Martin

Savidge, Malcolm

Lloyd, Tony(Manchester C)

Sawford, Phil

Love, Andrew

Sedgemore, Brian

McAvoy, Thomas

Shaw, Jonathan

McCafferty, Chris

Sheerman, Barry

McCartney, rh Ian

Sheridan, Jim

McDonagh, Siobhain

Short, rh Clare

MacDonald, Calum

Simpson, Alan(Nottingham S)

McDonnell, John

Singh, Marsha

McFall, John

Skinner, Dennis

McGuire, Mrs Anne

Smith, rh Andrew(Oxford E)

Mclsaac, Shona

Smith, Geraldine(Morecambe & Lunesdale)

Mackinlay, Andrew

McNulty, Tony

Smith, Jacqui(Redditch)

Mactaggart, Fiona

Smith, Llew(Blaenau Gwent)

McWalter, Tony

Soley, Clive

McWilliam, John

Squire, Rachel

Mahon, Mrs Alice

Starkey, Dr. Phyllis

Mann, John(Bassetlaw)

Steinberg, Gerry

Marris, Rob(Wolverh'ton SW)

Stevenson, George

Marsden, Gordon(Blackpool S)

Stewart, David(Inverness E & Lochaber)

Marshall, David(Glasgow Shettleston)

Stinchcombe, Paul

Marshall, Jim(Leicester S)

Stoate, Dr. Howard

Martlew, Eric

Strang, rh Dr. Gavin

Merron, Gillian

Stringer, Graham

Miliband, David

Stuart, Ms Gisela

Miller, Andrew

Sutcliffe, Gerry

Moffatt, Laura

Taylor, Dari(Stockton S)

Mole, Chris

Taylor, David(NW Leics)

Moonie, Dr. Lewis

Thomas, Gareth(Clwyd W)

287

Thomas, Gareth(Harrow W)

White, Brian

Thomas, Simon(Ceredigion)

Whitehead, Dr. Alan

Todd, Mark(S Derbyshire)

Wicks, Malcolm

Touhig, Don(Islwyn)

Wills, Michael

Trickett, Jon

Winnick, David

Truswell, Paul

Winterton, Ms Rosie(Doncaster C)

Turner, Dennis(Wolverh'ton SE)

Turner, Dr. Desmond(Brighton Kemptown)

Wishart, Pete

Woodward, Shaun

Woolas, Phil

Turner, Neil(Wigan)

Worthington, Tony

Twigg, Derek(Halton)

Wright, David(Telford)

Tynan, Bill(Hamilton S)

Wright, Tony(Cannock)

Vis, Dr. Rudi

Wareing, Robert N.

Tellers for the Ayes:

Watson, Tom(W Bromwich E)

Mr. Nick Ainger and

Watts, David

Margaret Moran

NOES

Allan, Richard

Gale, Roger(N Thanet)

Amess, David

Garnier, Edward

Atkinson, Peter(Hexham)

George, Andrew(St. Ives)

Bacon, Richard

Gidley, Sandra

Baldry, Tony

Gray, James(N Wilts)

Barker, Gregory

Green, Matthew(Ludlow)

Baron, John(Billericay)

Grieve, Dominic

Barrett, John

Gummer, rh John

Beggs. Roy(E Antrim)

Hammond, Philip

Blunt, Crispin

Hancock, Mike

Boswell, Tim

Harris, Dr. Evan(Oxford W & Abingdon)

Bottomley, Peter(Worthing W)

Bottomley, rh Virginia(SW Surrey)

Harvey, Nick

Hawkins, Nick

Brady, Graham

Hayes, John(S Holland)

Brake, Tom(Carshalton)

Heald, Oliver

Brazier, Julian

Heath, David

Breed, Colin

Hermon, Lady

Brooke, Mrs Annette L.

Holmes, Paul

Browning, Mrs Angela

Horam, John(Orpington)

Bruce, Malcolm

Jack, rh Michael

Burnett, John

Jenkin, Bernard

Burns, Simon

Jones, Nigel(Cheltenham)

Burnside, David

Keetch, Paul

Burt, Alistair

Key, Robert(Salisbury)

Butterfill, Sir John

Kirkwood, Sir Archy

Calton, Mrs Patsy

Knight, rh Greg(E Yorkshire)

Cameron, David

Laing, Mrs Eleanor

Campbell, Gregory(E Lond'y)

Lait, Mrs Jacqui

Cash, William

Lamb, Norman

Chapman, Sir Sydney(Chipping Barnet)

Lansley, Andrew

Leigh, Edward

Chidgey, David

Liddell-Grainger, Ian

Chope, Christopher

Lidington, David

Clappison, James

Lilley, rh Peter

Collins, Tim

Luff, Peter(M-Worcs)

Conway, Derek

McIntosh, Miss Anne

Cormack, Sir Patrick

Maclean, rh David

Cotter, Brian

McLoughlin, Patrick

Curry, rh David

Maples, John

Davey, Edward(Kingston)

Marsden, Paul(Shrewsbury & Atcham)

Davies, Quentin(Grantham & Stamford)

Maude, rh Francis

Davis, rh David(Haltemprice & Howden)

Mawhinney, rh Sir Brian

Mitchell, Andrew(Sutton Coldfield)

Dorrell, rh Stephen

Doughty, Sue

Moore, Michael

Duncan, Peter(Galloway)

Moss, Malcolm

Duncan Smith, rh lain

Murrison, Dr. Andrew

Fabricant, Michael

Oaten, Mark(Winchester)

Fallon, Michael

O'Brien, Stephen(Eddisbury)

Field, Mark(Cities of London & Westminster)

&#x00D6;pik, Lembit

Osborne, George(Tatton)

Flook, Adrian

Ottaway, Richard

Forth, rh Eric

Paice, James

Foster, Don(Bath)

Paterson, Owen

Francois, Mark

Pickles, Eric

288

Prisk, Mark(Hertford)

Taylor, Matthew(Truro)

Randall, John

Taylor, Sir Teddy

Reid, Alan(Argyll & Bute)

Teather, Sarah

Robertson, Hugh(Faversham & M-Kent)

Thurso, John

Tonge, Dr. Jenny

Robinson, Mrs Iris(Strangford)

Trend, Michael

Roe, Mrs Marion

Turner, Andrew(Isle of Wight)

Rosindell, Andrew

Tyler, Paul(N Cornwall)

Russell, Bob(Colchester)

Tyrie, Andrew

Sanders, Adrian

Viggers, Peter

Shepherd, rh Mrs Gillian

Walter, Robert

Shepherd, Richard

Webb, Steve(Northavon)

Simmonds, Mark

Widdecombe, rh Miss Ann

Simpson, Keith(M-Norfolk)

Wiggin, Bill

Spelman, Mrs Caroline

Williams, Roger(Brecon)

Spicer, Sir Michael

Willis, Phil

Spink, Bob(Castle Point)

Wilshire, David

Stanley, rh Sir John

Winterton, Ann(Congleton)

Steen, Anthony

Winterton, Sir Nicholas(Macclesfield)

Streeter, Gary

Stunell. Andrew

Young, rh Sir George

Swayne, Desmond

Younger-Ross, Richard

Swire, Hugo(E Devon)

Syms, Robert

Tellers for the Noes:

Tapsell, Sir Peter

Mr. David Ruffley and

Taylor, John(Solihull)

Mr. Geoffrey Clifton-Brown

Question accordingly agreed to.
Lords amendment 3B&#x2014;Lords Insistence and Reason
Amendment proposed: (a) in lieu thereof:&#x2014;
Question put, That the amendment be made:&#x2014;
The House divided: Ayes 312, Noes 115.
Division No. 96]
[8:49 pm

AYES

Abbott, Ms Diane

Caplin, Ivor

Ainsworth, Bob(Cov'try NE)

Caton, Martin

Allan, Richard

Cawsey, Ian(Brigg)

Allen, Graham

Challen, Colin

Anderson, rh Donald(Swansea E)

Chapman, Ben(Wirral S)

Atherton, Ms Candy

Chaytor, David

Austin, John

Chidgey, David

Bailey, Adrian

Clark, Mrs Helen(Peterborough)

Baird, Vera

Clark, Dr. Lynda(Edinburgh Pentlands)

Banks, Tony

Barnes, Harry

Clark, Paul(Gillingham)

Barrett, John

Clelland, David

Battle, John

Coaker, Vernon

Beard, Nigel

Coffey, Ms Ann

Beckett, rh Margaret

Connarty, Michael

Bennett, Andrew

Corbyn, Jeremy

Best, Harold

Cotter. Brian

Blackman, Liz

Cousins, Jim

Blears, Ms Hazel

Cox, Tom(Tooting)

Blizzard, Bob

Cranston, Ross

Borrow, David

Cruddas, Jon

Bradley, rh Keith(Withington)

Cryer, John(Hornchurch)

Bradley, Peter(The Wrekin)

Cunningham, Jim(Coventry S)

Brake, Tom(Carshalton)

Cunningham, Tony(Workington)

Breed, Colin

Curtis-Thomas, Mrs Claire

Brennan, Kevin

Dalyell, Tam

Brooke, Mrs Annette L.

Darling, rh Alistair

Brown, rh Nicholas(Newcastle E Wallsend)

Davey, Edward(Kingston)

Davey, Valerie(Bristol W)

Browne, Desmond

David, Wayne

Bruce, Malcolm

Davidson, Ian

Buck, Ms Karen

Davies, Geraint(Croydon C)

Burnham, Andy

Dawson, Hilton

Caborn, rh Richard

Dean, Mrs Janet

Cairns, David

Dhanda, Parmjit

Calton, Mrs Patsy

Dobson, rh Frank

Campbell, Alan(Tynemouth)

Donohoe, Brian H.

Campbell, Ronnie(Blyth V)

Doran, Frank

289

Doughty, Sue

Jones, Lynne(Selly Oak)

Dowd, Jim(Lewisham W)

Jones, Martyn(Clwyd S)

Drew, David(Stroud)

Jones, Nigel(Cheltenham)

Eagle, Angela(Wallasey)

Kaufman, rh Gerald

Eagle, Maria(L'pool Garston)

Keen, Alan(Feltham)

Edwards, Huw

Keen, Ann(Brenfford)

Ellman, Mrs Louise

Keetch, Paul

Etherington, Bill

Kemp, Fraser

Ewing, Annabelle

Kennedy, Jane(Wavertree)

Farrelly, Paul

Khabra, Piara S.

Field, rh Frank(Birkenhead)

Kilfoyle, Peter

Fisher, Mark

King, Ms Oona(Bethnal Green & Bow)

Fitzpatrick, Jim

Fitzsimons, Mrs Lorna

Kirkwood, Sir Archy

Flint, Caroline

Knight Jim(S Dorset)

Flynn, Paul(Newport W)

Kumar, Dr. Ashok

Follett, Barbara

Ladyman, Dr. Stephen

Foster, rh Derek

Lammy, David

Foster, Don(Bath)

Lawrence, Mrs Jackie

Foster, Michael(Worcester)

Laxton, Bob(Derby N)

Foster, Michael Jabez(Hastings & Rye)

Lazarowicz, Mark

Lepper, David

Foulkes, rh George

Leslie, Christopher

Francis, Dr. Hywel

Levitt, Tom(High Peak)

Gardiner, Barry

Lewis, Terry(Worsley)

George, Andrew(St. Ives)

Liddell, rh Mrs Helen

George, rh Bruce(Walsall S)

Linton, Martin

Gerrard, Neil

Lloyd, Tony(Manchester C)

Gibson, Dr. Ian

Love, Andrew

Gidley, Sandra

McAvoy, Thomas

Gilroy, Linda

McCafferty, Chris

Godsiff, Roger

McCartney, rh Ian

Goggins, Paul

McDonagh, Siobhain

Green, Matthew(Ludlow)

MacDonald, Calum

Griffiths, Win(Bridgend)

McDonnell, John

Grogan, John

McFall, John

Hain, rh Peter

McGuire, Mrs Anne

Hall, Mike(Weaver Vale)

Mclsaac, Shona

Hall, Patrick(Bedford)

Mackinlay, Andrew

Hancock, Mike

McNulty, Tony

Hanson, David

Mactaggart, Fiona

Harman, rh Ms Harriet

McWalter, Tony

Harris, Dr. Evan(Oxford W & Abingdon)

McWilliam, John

Mahon, Mrs Alice

Harvey, Nick

Mann, John(Bassetlaw)

Havard, Dai(Merthyr Tydfil & Rhymney)

Marris, Rob(Wolverh'ton SW)

Marsden, Gordon(Blackpool S)

Healey, John

Marsden, Paul(Shrewsbury & Atcham)

Heath, David

Henderson, Ivan(Harwich)

Marshall, David(Glasgow Shettleston)

Hepburn, Stephen

Heppell, John

Marshall, Jim(Leicester S)

Hesford, Stephen

Martlew, Eric

Heyes, David

Merron, Gillian

Hill, Keith(Streatham)

Miliband, David

Hinchliffe, David

Miller, Andrew

Hoey, Kate(Vauxhall)

Moffatt, Laura

Holmes, Paul

Mole, Chris

Hope, Phil(Corby)

Moonie, Dr. Lewis

Hopkins, Kelvin

Moore, Michael

Howarth, George(Knowsley N & Sefton. E)

Moran, Margaret

Morgan, Julie

Hughes, Beverley(Stretford & Urmston)

Morley, Elliot

Mountford, Kali

Hughes, Kevin(Doncaster N)

Mudie, George

Humble, Mrs Joan

Mullin, Chris

Hurst Alan(Braintree)

Murphy, Denis(Wansbeck)

Iddon, Dr. Brian

Murphy, Jim(Eastwood)

Illsley, Eric

Naysmith, Dr. Doug

Ingram, rh Adam

Norris, Dan(Wansdyke)

Jackson, Helen(Hillsborough)

Oaten, Mark(Winchester)

Jamieson, David

&#x00D6;pik, Lembit

Johnson, Miss Melanie(Welwyn Hatfield)

Organ, Diana

Osborne, Sandra(Ayr)

Jones, Helen(Warrington N)

Owen, Albert

Jones, Kevan(N Durham)

Palmer, Dr. Nick

290

Pearson, Ian

Stewart, David(Inverness E & Lochaber)

Pickthall, Colin

Plaskitt, James

Stinchcombe, Paul

Pollard, Kerry

Stoate, Dr. Howard

Pond, Chris(Gravesham)

Strang, rh Dr. Gavin

Pope, Greg(Hyndburn)

Stringer, Graham

Prentice, Ms Bridget(Lewisham E)

Stuart, Ms Gisela

Stunell, Andrew

Prentice, Gordon(Pendle)

Sutcliffe, Gerry

Prescott, rh John

Taylor, Dari(Stockton S)

Price, Adam(E Carmarthen & Dinefwr)

Taylor, David(NW Leics)

Taylor, Matthew(Truro)

Primarolo, rh Dawn

Teather, Sarah

Prosser, Gwyn

Thomas, Gareth(Clwyd W)

Purchase, Ken

Thomas, Gareth(Harrow W)

Quinn, Lawrie

Thomas, Simon(Ceredigion)

Rammell, Bill

Thurso, John

Raynsford, rh Nick

Todd, Mark(S Derbyshire)

Reed, Andy(Loughborough)

Tonge, Dr. Jenny

Reid, Alan(Argyll & Bute)

Touhig, Don(Islwyn)

Robertson, Angus(Moray)

Trickett, Jon

Robinson, Geoffrey(Coventry NW)

Truswell, Paul

Turner. Dennis(Wolverh'ton SE)

Roche, Mrs Barbara

Turner. Dr. Desmond(Brighton Kemptown)

Rooney, Terry

Ross, Ernie(Dundee W)

Turner, Neil(Wigan)

Roy, Frank(Motherwell)

Twigg, Derek(Halton)

Russell, Bob(Colchester)

Tyler, Paul(N Cornwall)

Russell, Ms Christine(City of Chester)

Tynan. Bill(Hamilton S)

Vis, Dr. Rudi

Ryan, Joan(Enfield N)

Wareing, Robert N.

Salmond, Alex

Watson, Tom(W Bromwich E)

Watts, David

Sanders, Adrian

Webb, Steve(Northavon)

Sarwar, Mohammad

White, Brian

Savidge, Malcolm

Whitehead, Dr. Alan

Sawford, Phil

Wicks, Malcolm

Sedgemore, Brian

Williams, Roger(Brecon)

Shaw, Jonathan

Willis, Phil

Sheerman, Barry

Wills, Michael

Sheridan, Jim

Winnick, David

Simpson, Alan(Nottingham S)

Winterton, Ms Rosie(Doncaster C)

Singh, Marsha

Skinner, Dennis

Wishart, Pete

Smith, rh Andrew(Oxford E)

Woodward, Shaun

Smith, Geraldine(Morecambe & Lunesdale)

Woolas, Phil

Worthington, Tony

Smith, Jacqui(Redditch)

Wright, David(Telford)

Smith, Llew(Blaenau Gwent)

Wright, Tony(Cannock)

Soley, Clive

Younger-Ross, Richard

Squire, Rachel

Starkey, Dr. Phyllis

Tellers for the Ayes:

Steinberg, Gerry

Mr. Nick Ainger and

Stevenson, George

Charlotte Atkins

NOES

Amess, David

Cameron, David

Atkinson, Peter(Hexham)

Campbell, Gregory(E Lond'y)

Bacon, Richard

Cash, William

Baldry, Tony

Chapman, Sir Sydney(Chipping Barnet)

Barker, Gregory

Baron, John(Billericay)

Chope, Christopher

Beggs, Roy(E Antrim)

Clappison, James

Bellingham, Henry

Collins, Tim

Blunt, Crispin

Conway, Derek

Boswell, Tim

Cormack, Sir Patrick

Bottomley, Peter(Worthing W)

Curry, rh David

Bottomley, rh Virginia(SW Surrey)

Davies, Quentin(Grantham & Stamford)

Brady, Graham

Davis, rh David(Haltemprice & Howden)

Brazier, Julian

Browning, Mrs Angela

Dorrell, rh Stephen

Burns, Simon

Duncan, Peter(Galloway)

Burnside, David

Duncan Smith, rh lain

Burt, Alistair

Fabricant, Michael

Butterfill, Sir John

Fallon, Michael

291

Field, Mark(Cities of London & Westminster)

Paice, James

Paterson, Owen

Flook, Adrian

Pickles, Eric

Forth, rh Eric

Prisk, Mark(Hertford)

Francois, Mark

Randall, John

Gale, Roger(N Thanet)

Robertson, Hugh(Faversham & M-Kent)

Garnier, Edward

Gray, James(N Wilts)

Robinson, Mrs Iris(Strangford)

Grieve, Dominic

Roe, Mrs Marion

Gummer, rh John

Rosindell, Andrew

Hammond, Philip

Shephard, rh Mrs Gillian

Hawkins, Nick

Simmonds, Mark

Hayes, John(S Holland)

Simpson, Keith(M-Norfolk)

Heald, Oliver

Spelman, Mrs Caroline

Hermon, Lady

Spicer, Sir Michael

Horam, John(Orpington)

Spink, Bob(Castle Point)

Jack, rh Michael

Stanley, rh Sir John

Jenkin, Bernard

Steen, Anthony

Key, Robert(Salisbury)

Streeter, Gary

Knight, rh Greg(E Yorkshire)

Swayne, Desmond

Laing, Mrs Eleanor

Swire, Hugo(E Devon)

Lait, Mrs Jacqui

Syms, Robert

Lansley, Andrew

Tapsell, Sir Peter

Leigh, Edward

Taylor, John(Solihull)

Lewis, Dr. Julian(New Forest E)

Taylor, Sir Teddy

Liddell-Grainger, Ian

Tredinnick, David

Lidington, David

Trend, Michael

Lilley, rh Peter

Turner, Andrew(Isle of Wight)

Luff, Peter(M-Worcs)

Tyrie, Andrew

McIntosh, Miss Anne

Viggers, Peter

Maclean, rh David

Walter, Robert

McLoughlin, Patrick

Widdecombe, rh Miss Ann

Maples, John

Wiggin, Bill

Maude, rh Francis

Willetts, David

Mawhinney, rh Sir Brian

Wilshire, David

May, Mrs Theresa

Winterton, Ann(Congleton)

Mitchell, Andrew(Sutton Coldfield)

Winterton, Sir Nicholas(Macclesfield)

Moss, Malcolm

Yeo, Tim(S Suffolk)

Murrison, Dr. Andrew

Young, rh Sir George

O'Brien, Stephen(Eddisbury)

Tellers for the Noes:

Osborne, George(Tatton)

Mr. David Ruffley and

Ottaway, Richard

Mr. Geoffrey Clifton-Brown

Question accordingly agreed to.
Message to the Lords, with the Bill and Amendments.

Nuclear Global Threat
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Kemp.]
9 pm
Llew Smith: The Government's opposition to weapons of mass destruction was given as the reason for going to war with Iraq. Those weapons did not exist in Iraq, but they exist in Israel, and not only does Israel have weapons of mass destruction; it has the ultimate weapon of mass destruction—nuclear weapons. Indeed, it has 200 nuclear warheads. However, there is no talk, and quite rightly so, of any kind of war with Israel, partly. one would have thought, because of its weapons of mass destruction, partly because it daily invades its neighbour, Palestine, and partly because it daily treats UN resolutions with contempt. Obviously, our Government are selective in their opposition to weapons of mass destruction: they are okay as far as Israel is concerned, but they are certainly not okay as far as Iraq is concerned.
The threat of weapons of mass destruction, and in particular of atomic and nuclear weapons, has been with us since 1945, and the bombing of Hiroshima and Nagasaki, the tragedy that went with that and the tragedy that followed it, with the deaths of hundreds of thousands of Japanese civilians and, probably, a similar number of injuries. On some of the anniversaries of those bombings a message has come from the Japanese people: "Step back and learn from us." Sadly, we have failed to act on that message, which the Japanese people wanted to be not only heard but acted on.
Sadly, too, the Government are refusing to support some of the peacemakers, the people who have had the good sense and the courage to warn of nuclear proliferation and its threat to this planet. In particular I think of Mordechai Vanunu, who for the past 18 years has been rotting away in an Israeli jail. His crime, if crime is the right word, and it certainly is not, was telling the truth about Israel's nuclear capability when all around him were lying.
We are also selective in our opposition to weapons of mass destruction, and in particular nuclear weapons, when we consider our own position. I am not saying that the Secretary of State of Defence has learned to love nuclear weapons, but he has accepted the need to use them in certain circumstances. I remember him saying a while back:
"The United Kingdom would, in the right conditions, in extreme circumstances of self-defence, be prepared to use nuclear weapons."&#x2014;[Official Report, 10 April 2002; Vol. 383, c. 30W.]
For me, there are no conditions and no circumstances that would justify the use of nuclear weapons. Pressing that button would, for a number of reasons, be the ultimate act of madness.
Nuclear weapons are madness because they are a total waste of money. Trident alone has cost the United Kingdom in the region of £15 billion, and the annual cost of operating those weapons is in the region of £280 million. It is madness to use that money on such a weapon when it could be spent for far more socially useful purposes, such as providing some of the services that for many years people took for granted. If we stopped spending money on nuclear warheads, we

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could, for example, use it to return to the old socialist principle of free higher education or, indeed, provide more decent pensions for our senior citizens—the list of uses is endless.
Our nuclear industry involves another financial cost. On 2 July 2002, the Department of Trade and Industry announced that the clean-up liability for the civil nuclear industry was about £48 billion, and rising. The Ministry of Defence has not revealed the equivalent figure for the military today, but hopefully the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Harlow (Mr. Rammell), will provide the House with such information when he replies to our debate.
There is one cost that I would welcome, but which the Government have failed to meet—proper compensation for the atomic veterans and their families for the suffering caused by events many years ago. It is estimated that the United States spent $3 trillion between 1940 and 1995 on a possible nuclear war. Annually, it spends $27 billion on preparations for such a war. Those figures do not include the costs of environmental clean-ups.
Another act of madness is the waste of skills, talents and creativity in the design and production of nuclear weapons. Imagine what could be achieved if we transferred those skills from military to civilian use. How much more dignified life could be for many more people. The greatest act of madness is the fact that nuclear weapons would kill not only our so-called enemy but our supporters. Ironically, they would kill the people who designed and produced them. Not only would they kill the enemy, our own people and the people who designed and produced those weapons of war but they would kill civilisation as we know it. They would literally cost us the earth.
That is not just my opinion, but the opinion of many eminent statespeople. Many years ago, the former US President Jimmy Carter argued:
"In an all-out nuclear war, more destructive power than in all of World War II would be unleashed every second during the long afternoon it would take for all the missiles and bombs to fall.
A World War II every second&#x2014;more people killed in the first few hours than all the wars of history put together. The survivors, if any, would live in despair amid the poisoned ruins of a civilisation that had committed suicide."
Khrushchev expressed similar sentiments, when he said that after a nuclear war
"the survivors would envy the dead".
President Carter made his statement more than 20 years ago, and our capacity to destroy our beautiful planet has increased dramatically in the intervening period. No individual or Government has the moral right to agree to the use of nuclear weapons. We have no moral right to take away from our children the opportunity to experience the many beautiful things on our planet. We have no right to take away from them the opportunity to avoid the mistakes of our generation or to achieve something good with their lives. But that is what we would be doing if we ever agreed, as the Secretary of State for Defence has agreed, to use nuclear weapons in certain circumstances.
The use of nuclear weapons would be not just an act of madness, but an act of hypocrisy. We cannot tell other states that they should not produce nuclear
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weapons or that they should abandon the nuclear weapons that they have if we continue to go down the nuclear road. It has been estimated that 128,000 nuclear warheads have been built worldwide since 1945, 70,000 of them in the United States. Our continued nuclear role is not only an act of madness and hypocrisy, but in my opinion and in the opinion of many lawyers it is illegal. We are signatories to the non-proliferation treaty, yet we daily breach the laws enshrined in that treaty.
While we continue to have nuclear weapons of mass destruction, we are clearly in breach of article VI of the treaty, which calls for each party to the treaty to enter into negotiations at an early date in good faith to achieve nuclear disarmament. That is not happening. Article I forbids any country that has signed up to the NPT, including countries that possess nuclear weapons, to collaborate directly or indirectly with any other country on nuclear weapons. It is obvious that Trident breaks this article. We breach article VI because, as the Secretary of State for Defence admitted,
"Negotiations to implement Article VI have not yet commenced and are not scheduled."—[Official Report, 26 February 2004; Vol. 418, c. 498W.]
Because Trident represents a significant increase in our capability, it is in breach of article VI as a serious act of proliferation. Even if the number of warheads is kept similar to the number deployed on Polaris, the qualitative difference in targeting capacity and accuracy of the missile system makes it a much more potent weapon. On 16 June 2002 an Atomic Weapons Establishment spokesperson at Aldermaston told The Observer that
"it had to maintain the capability to design a successor"
to Trident. Once again, that breaks articles of the non-proliferation treaty.
The UK is in breach of article I of the NPT, which states:
"Each nuclear-weapon State Party to the Treaty undertakes not to transfer to any recipient whatsoever nuclear weapons or other nuclear explosive devices or control over such weapons or explosive devices directly, or indirectly".
The Trident nuclear WMD system was bought from the USA and its warheads were tested in the USA, which provides targeting technology and command and control support. By any judgment that is indirect support. I would argue that it is direct support.
What is particularly disgraceful about the continued military co-operation between the United States and the UK, which neither Tory nor, apparently, new Labour Administrations can grasp, is that these countries are two of the three depository states for the NPT. In effect, the treaty is held in trust by them. How do they show their respect? By breaking the very first article of the treaty.
The bilateral US/UK mutual defence agreement on atomic energy matters dating from 1958, which facilitates this co-operation, comes up for renewal later this year. It should be cancelled as an international gesture of good faith. Until decision makers and law makers in the nuclear armed powers recognise that the US and the UK in particular have obligations as part of the NPT bargain, no amount of lecturing other states how to behave in the face of nuclear proliferation temptations will have any credibility. If we continue to ignore the NPT or to break its articles, the greater will be the global threat of nuclear weapons.

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The policy of successive Governments, Tory and Labour, is that we simultaneously support both our non-proliferation treaty commitments to nuclear disarmament and our need to retain nuclear weapons of mass destruction to protect our national security. Some might perceive a significant internal inconsistency in those policy positions—indeed, some might consider them to be in direct contradiction. That is in stark contrast with a decision that was taken at a Labour party conference in the early 1990s that we, as a future Labour Government, would, among other things, scrap Trident.
In 1985, the UN Secretary-General, opening a review conference on the non-proliferation treaty stated:
"The most safe, sure and swift way to deal with the threat of nuclear arms is to do away with them in every regard. This should be our vision of the future. No more testing. No more production. No more sales or transfers. Reduction and destruction of all nuclear weapons and the means to make them should be humanity's common cause."
Sadly, almost 20 years later they are more of a threat than they were when those words were first spoken.
In my opinion, nuclear weapons will continue to be a threat to global security if we continue to ignore our obligations under the non-proliferation treaty. My hopes, and those of many other people committed not only to the anti-nuclear cause, but to world peace, are embodied in the NPT. If this Government and the Government of the United States continue to treat that treaty with contempt, the hopes of world peace and of avoiding nuclear catastrophe will be sorely diminished.
9.16 pm
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Bill Rammell): I congratulate my hon. Friend the Member for Blaenau Gwent (Llew Smith) on giving us the opportunity to air these exceedingly important issues. In the time available to me, I hope not only to respond to several of the points that he raised, but to set out the Government's overall position on the possession of nuclear weapons and on nuclear proliferation. I hope to rebut some of the very serious accusations that he made.
The Government's policy on nuclear weapons remains that which was set out in the 1998 strategic defence review and the 2003 defence White Paper. We are explicitly committed to working towards a safer world in which there is no requirement for nuclear weapons and where we continue to play a full role in international efforts to strengthen arms control and to prevent the proliferation of hugely critical chemical, biological and nuclear weapons.
However, because of the continuing risk from the proliferation of nuclear weapons—which I genuinely believe to be one of the most serious threats that we face in the modern world—and the certainty that a number of countries will retain substantial nuclear arsenals, our minimum nuclear deterrent capability, which is currently represented by Trident, is likely to remain a necessary element of our security. We nevertheless continue to support multilateral negotiations towards mutual, balanced and verifiable reductions in nuclear weapons worldwide. When we are satisfied that
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sufficient progress has been made to allow us to include British nuclear weapons in any negotiations without endangering our security interests, we shall most certainly do so.
Let me deal with the key arguments that my hon. Friend advanced in respect of our progress in meeting article VI of the non-proliferation treaty. We remain fully committed to all aspects of the NPT regime, including global and verifiable nuclear disarmament. In contrast to my hon. Friend's comments, we have an excellent record on fulfilling our NPT obligations on nuclear disarmament. Looking at the issue objectively across the world, we are justly recognised as the most forward leaning of the nuclear weapons states—although one would not have believed that in listening to my hon. Friend.
It is worthwhile setting out in some detail what we have done to meet the provisions of the article.
First, we withdrew and dismantled the RAF's freefall nuclear bomb, so that Trident is now our only nuclear weapons system.
Secondly, we dismantled the UK's last Chevaline warhead in 2002, demonstrating our commitment to irreversibility in reductions in the UK's nuclear weapons.
Thirdly, we reduced our operationally available stockpile to fewer than 200 warheads—that is a reduction of more than 70 per cent since the end of the cold war in the potential explosive power of our nuclear forces.
Fourthly, we have reduced the readiness of our nuclear forces so that only a single Trident submarine is now on deterrent patrol, carrying 48 warheads. The submarine on patrol is normally on several days' notice to fire, and its missiles are de-targeted. I believe that all of those are significant de-escalatory measures.
Fifthly, we signed and ratified the comprehensive nuclear test ban treaty and continue to promote its early entry into force. Sixthly, we have placed fissile material no longer required for defence purposes under international safeguards. We have also continued to press for negotiations to begin at the conference on disarmament in Geneva on a fissile material cut-off treaty. Indeed, we stopped the production of fissile material for nuclear weapons and other nuclear explosive devices some time ago.
Finally, in respect of these specific measures under the NPT regime, we signed and ratified the relevant protocols to both the treaty of Rarotonga, in relation to the south Pacific nuclear weapons-free zone, and the treaty of Pelindaba, in relation to the African nuclear weapons-free zone. All those actions have been undertaken since 1997 as a result of the commitment of this Government.
Llew Smith: The Minister has cited many reasons and many weapons to prove that we are supporting article VI of the NPT. He has not yet mentioned Trident, or told the House how that fits in with the NPT. While I am on my feet, will he tell us whether, in certain circumstances and under certain conditions, he would be willing to press the nuclear button?
Mr. Rammell: I am going to discuss the issue of Trident explicitly in a moment. Before I do so, I want to emphasise that all the measures that I have outlined are significant steps that this Labour Government have taken since 1997, in accordance with our NPT obligations.
My hon. Friend questioned the legality of our possession of nuclear weapons, but it is very clear, in terms of the view of the International Court of Justice on this issue, that our nuclear weapons possession and capability is in accordance with international law. It is important to make that point very clearly. He also referred to the views of my right hon. Friend the Secretary of State for Defence, and it is important to put in context what my right hon. Friend said. He made it very clear that the circumstances in which any use of nuclear weapons might have to be contemplated would be extremely remote, and that we would use them only in extreme circumstances of self-defence and in accordance with our obligations under international law. That is a very different slant from the one that my hon. Friend put on that proposition.
The UK continues to play a full part in the NPT review process. Indeed, we played a key role in achieving international agreement to the final document that was produced at the last NPT review conference in 2000. We have made considerable progress on the 13 steps set out in that final document. At the second session of the preparatory committee for the 2005 review conference, which was held in Geneva in April and May last year, we issued a working paper on our research into methodologies for the verification of nuclear disarmament. That is a cause that we intend to continue to pursue.
Let me now turn to whether the possession of Trident is consistent with the spirit of article I. I would certainly contend that we are not in breach of article I. The Government have repeatedly made it clear that the UK nuclear deterrent is, and always has been, independent. The UK's nuclear weapons cannot be part of a US system, as the transfer by a nuclear weapon state of nuclear weapons or other nuclear explosive devices, or control over such weapons or explosive devices, is prohibited under article I of the NPT. We have, of course, purchased from the US Trident missile bodies on which we mount our nuclear warheads, which are manufactured at the Atomic Weapons Establishment. Those missiles are carried on UK-built Vanguard class submarines. Decisions on whether to replace Trident are not needed during this Parliament, but are likely to be required in the next one. We will therefore continue to take appropriate steps to ensure that the range of options for maintaining a nuclear deterrent capability is kept open until that decision point.
My hon. Friend made a number of points about Israel and the middle east. It is undoubtedly the case that a peaceful and secure middle east is a critical and continuing goal of this Government's foreign policy. We are strong advocates of a middle east WMD-free zone, which we believe to be an important part of any solution to the conflict there.
We support the principle generally of the establishment of such nuclear weapons-free zones. Indeed, we have already signed in conjunction with the
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other nuclear weapons states recognised under the NPT protocols to four such agreements covering Latin America, the south Pacific, Africa and Antarctica. In that context, we therefore continue to support the proposal for a middle east nuclear weapons free-zone. Indeed, since it was formulated in United Nations Security Council resolution 687 in 1991, the UK has supported the wider idea of a middle east free of all weapons of mass destruction. I genuinely believe that working towards that objective can only contribute to the prospects for a wider settlement of the region's problems.
Llew Smith: Will the Minister now answer the question whether, under the extreme circumstances referred to by the Secretary of State for Defence, he too would be willing to press the nuclear button?
Mr. Rammell: I set out very clearly the position on our possession and use of nuclear weapons: they would be used only in extreme circumstances of self-defence. That point is very clear.
Let me return to the issue of the middle east. My hon. Friend made a number of comments on the situation in Israel. We have made it clear that we want Israel to sign up to the NPT as a non-nuclear state and we will continue to argue that point. It is also important that, in any debate on nuclear weapons and the dangers that we face, we also consider the considerable dangers that we face from the proliferation of nuclear weapons materials across the world. I said earlier that that is one of the most significant threats that we face in the modern world. We have to ensure that we are vigilant about and focused on it. That is why, for example, we have committed ourselves to the global partnership.
In June 2002, the Prime Minister made a commitment of up to £400 million over 10 years to tackle the weapons legacy of the former Soviet Union—a significant step forward. Those activities are aimed directly at reducing the proliferation risks posed by that weapons legacy. As the Foreign Secretary said in his written statement of 25 February, it is intended that that work should be expanded to include other states such as Libya and Iraq. We are undertaking a scoping study, looking at the requirements for co-operative threat reduction work in Libya. We are working alongside the United States to gauge the needs in Iraq.
It is also within that context that we consider the important proliferation security initiative, which was launched in May 2003. The UK has rightly been one of a core group of countries working to drive that initiative forward. The PSI aims to prevent trafficking in weapons of mass destruction and related technology by states and non-state actors—for example. terrorist groups or criminal networks—through increased interdiction efforts. That is hugely important.
The prospect that such weapons capability can get into the hands of terrorists who have no regard for human rights or for the effect of their actions is one of the most serious and dangerous threats that we face. We must work multilaterally to ward off the dangers that exist in that regard and it is critical that we remain focused on those issues.
I understand the concerns that my hon. Friend has raised: none of us who has lived through the cold war and the continuing dangers, threats and risks that exist

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with nuclear weapons can look on those issues with equanimity. The track record that I have described, our commitments under the non-proliferation regime and the significant steps that we have taken since 1997 to reduce our nuclear weapons on a multilateral and verifiable basis emphasise that we are committed to
300
working for peace throughout the world, reducing weapons of mass destruction and protecting ourselves from such weapons. The Government are committed to hose aims and will continue to take their arguments forward.
Question put and agreed to.
Adjourned accordingly at half-past Nine o'clock.

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

Farming
Motion made, and Question proposed, That the sitting be now adjourned.—[Vernon Coaker.]
9.30 am
Mr. Peter Atkinson: I am pleased to have the opportunity to debate the financial future of farming. I do not want to be unduly churlish, but the recent reforms of the common agricultural policy are among the most significant changes for farming since the last war. It is therefore a pity that we are debating the subject in Westminster Hall and not having a full-scale debate on the Floor of the House. Some hon. Members will recall that it was the practice to have regular debates on agriculture, but my memory suggests that we have not had a proper debate on the subject for a long time. Although I am grateful for today's debate, it is still the second-best option. Farming in Great Britain deserves more than 90 minutes in Westminster Hall.
The debate gives hon. Members the opportunity to raise some of the concerns arising out of the Government's decision to decouple subsidies in line with the mid-term reform of CAP. Farmers' income has increased during the past few years. In the past year, it has risen from an average of about £11,000 a year to approximately £15,000, but that is still a small amount of money. The farming industry may be only a small part of the British economy, but it is none the less important. Most people believe that the landscape that they so cherish is looked after by farmers; the role of farmers is thus far more important than the simple economic strength of their industry. That is why anything that damages the farming industry should be viewed with great concern by the British people and the Government.
One problem that farmers face is uncertainty. They have lived with it for years—it is part of a farmer's life when it comes to the weather, climate and so on. However, the financial uncertainty that has been with them for years seems to be getting worse. The mid-term reform of CAP means that we now know, in rough terms, what is going to happen to subsidies in Scotland, Wales, Northern Ireland and England. However, farmers cannot look at their books and say what their income is likely to be, or what sort of subsidy they are likely to receive. Indicative of that is the fact that, at a meeting of senior members of the Scottish agriculture department, a senior official who was asked for an estimate of farming incomes in a few years' time replied, "I don't know."
Farmers need certainty. They need to know where they are going. Farming is a hugely capital-intensive business, not only because of land prices but because of the costs of long-term investment. Farmers cannot predict the future, but if they do not have a reasonable idea of where they might be in four or five years, it becomes ever harder to make investment decisions.
2WH
Dairy farmers are under the greatest pressure. The other day, they were told in no uncertain terms that unless they could reduce their production costs to below 18p a litre, they might as well pack up and go home. It is no doubt true that at least 60 per cent. of milk produced in England is sold at a loss. The reason why so many dairy farmers seem to survive against all the odds is that many dairy farms are family-run; but they seem to live on air, not money. It is because the family pitches in that farms can continue, but they had a blunt warning that if they could not reduce their costs they would go out of business—or be forced to take up another form of agriculture. That is a crucial decision for farmers. Some families, particularly those in my constituency in Northumberland, have been dairy farming for years. They are now having to consider whether to continue or join the many who have already left the industry.
I shall concentrate on one sector that has been seriously affected by the Government's decision to introduce a two-tier system of single farm payments in England: farmers in upland areas. Many in Northumberland are likely to be seriously affected by the Government's decision that there should be two payment areas—those where the land is classified as severely disadvantaged, and the rest, so to speak. The majority of hill farmers in Northumberland, the north Pennines, the Lake district, the Peak district—where the constituency of my hon. Friend the Member for West Derbyshire (Mr. McLoughlin) is—Exmoor, Dartmoor and the Welsh borders will be hugely affected.
Just over 300 farmers attended a meeting that took place at Hexham auction mart a week ago. That suggests how much worry, and what strength of feeling, the decision not to pay a full rate of subsidy in those severely disadvantaged areas has caused among those farmers.
There seems to be a misunderstanding about what is happening up in the hills. About 30 years ago the Government gave farmers a substantial grant to reclaim moorland and rough grazing. Those farmers did so, on a large scale. In areas that were categorised as severely disadvantaged 30 years ago, there has been substantial improvement in the way that the land has been brought into pasture and grazing, and looked after.
It is paradoxical that for years farmers were given money to remove heather moorland and white grass rough grazing and convert it to productive grassland, but now they are being given grant money to return it to the state of unproductive grassland and heather. In my constituency there is an experimental farm, which led the way in reclaiming rough grazing for good pasture. When the Government policy changed, the principal resigned, because having spent 30 years teaching everyone how to recover such land, he could not face the idea of having to tell people how to return it to the way it used to be.
The long and the short of it is that many acres in the SDAs are typical grassland. One farmer in my constituency has 50 acres of arable land, which he ploughs regularly, in the SDA. The impact of the decision will be marked. Farmers in upland areas will experience a substantial reduction in their income as the single farm payment switches from the historical basis to the area payment basis over the next eight years.
By way of example, one farmer in my constituency, whom I shall not name, has calculated that his total payment in subsidies, which is now £30,927 a year, will

3WH
diminish to £14,625 during the eight-year transition period. His cumulative loss will amount to £78,440. In contrast, his neighbour, on the other side, has an upland farm that to all appearances is just the same as my constituent's, but that is outside the SDA line. That line on the map means that the farmer next door will gain £66,000 over the eight years. That will cause problems for the farmers affected.
Problems arise in many ways. The upland farmers—;certainly in Northumberland—have tended to be specialists in high-quality livestock. They breed top-quality lambs that sell for substantial prices in sales of breeding stock, as well as top-quality cattle. To maintain that high standard new stock must be brought in, but to improve a flock or herd, top-quality replacements must be bought in. Therefore there is competition between farmers at the auction marts for such stock. How will a farmer who has lost £78,440 compete with a farmer who has gained £66,483? The answer is that the farmer in the SDA, who relies on buying good-quality stock, will have to face being outbid by his neighbour who is in a better position to afford it.
There will be other knock-on effects. My constituency in Northumberland lies on the Scottish border. In Scotland the historical system has been adopted throughout—a fixed amount. Farmers on the Scottish side will have vastly more than their neighbours on the English side. That will apply to farmers in Wales, too. Those in the borders and the marches will be in the same predicament. One farmer will be disadvantaged in comparison to another, simply because of a geographical spread.
The decision will have an environmental impact. Many environmental organisations are deeply concerned about its impact on the look of the hills. When I met farmers the other day to talk about the matter, one of the things that they, and especially a big beef producer, said was, "If this happens, I will not be able to afford to maintain a suckler cow herd. I will simply have to sell it off and go into the business of ranching sheep. That is low cost, and would allow me to lose the man that I employ and simply run a large sheep ranch on my own and my son's labour."
Taking the cattle off the hills will change the environment because those who understand such things know that sheep graze one particular type of ground in a different way from cattle. In order to maintain the environment that we like so much in our upland areas, we need that variety of grazing. That will go and the environmental cost will be serious, not only for the appearance of the land but for wildlife. Ungrazed land in the upland areas soon becomes infested with things such as ticks. That will have a profound effect on some of the birds and animals that live there.
I pray in aid a letter that has been given to me by my hon. Friend the Member for Ryedale (Mr. Greenway), whose constituency is hugely affected by the proposal but who is sadly unable to be here today. He received a letter from the chief executive of the North York Moors national park authority, and it is worth quoting a paragraph from it as it encapsulates the environmental concerns that the change has prompted. The chief executive writes:
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"The detail of the proposed payments does however bring with it some severe consequences for the National Park. The core of the National Park is Severely Disadvantaged Area and this land is due to receive a much lower rate of payment per hectare than the rest of the country. Not only does the Severely Disadvantaged Area encompass moorland, it also includes almost the entirety of the famous Dales of the Park such as Farndale. Fryup Dale, Bransdale, Rosedale etc plus large parts of Bilsdale and other Dales. As you know, these Dales are stunningly beautiful and they contain relatively large numbers of fairly small farms."
That at least identifies those farmers who will be hugely disadvantaged. The land is worked much more intensely than moorland. Consequently, current public subsidy is much higher than for moorland areas because the productivity is high enough.
I know Farndale quite well, because it happens to belong to a constituent of mine. It is one of the most beautiful valleys in that part of Yorkshire. The small farms do much to add to the appearance of a very attractive dale. If we knock the economic heart out of those communities, the future for the appearance of Farndale and the other dales, in my constituency and that of my hon. Friend the Member for West Derbyshire, will be bleak.
Mr. Patrick McLoughlin: Will my hon. Friend also take time to point out that farming on some of the smaller farms, in smaller fields, with the restrictions that they have, can be much more expensive and intensive for the farmer and farm labour than in some large arable areas, which will be included in the general payment scheme? Far from helping the countryside and the agri-rural environment, as the Government say that they want to, the proposals could greatly damage the smaller farms that we often find in that part of the country.
Mr. Atkinson:Precisely. That is exactly the problem. To make a gentle political point, it is slightly perverse that a Labour Government should seek to deprive the small, hard-working farmers whom my hon. Friend has just mentioned and to reward large grouse moor owners, such as those in my constituency and in the north Pennines. I am a great grouse-shooting enthusiast. I believe that it greatly benefits the countryside, preserves the heather moor and adds a lot to the local economy. However, I am not quite happy with the idea that an Arab prince who owns a very good moor in my constituency should receive the substantial additional payment, while the hard-working farmer that my hon. Friend has mentioned suffers. That seems perverse from a Labour Government.
There is an economic problem too, because such farms employ labour. Some of the bigger farms in my constituency employ labour directly, but the smaller farms employ people to do particular jobs. That makes an important contribution to the local economy. The money is spent in local agricultural merchants and shops. Such farmers tend to be isolated so they usually spend more money in the local community rather than drive to the nearest town for their shopping. Removing the money will seriously disadvantage that economy.
Excluding farms in the SDAs from the full subsidy will be especially damaging. I do not understand why the particular boundary line was chosen. It is a line on a map that is seriously outdated because, as I mentioned earlier, much of the land has been improved. Surely a

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much better way of categorising the land would be to adopt what is known as the moorland line, which is used for many other purposes and defines what most ordinary people would call moorland—heather or white grass—differentiating it from cultivated land. That would seem a much more sensible arrangement.
There have been suggestions that the affected farmers could be compensated through much higher rates of environmental payments to counter their loss in the single farm payment. That is not a solution. Although environmental payments could give more money to those farmers, they would not remove uncertainty because they can vary and depend on adjusting farming activities to meet their criteria. Sir Donald Curry, who was responsible for the Curry commission, is a constituent of mine, and knows well the problems faced by the SDA farmer. He said that giving extra money for environmental schemes is not an answer.
I urge the Government to go back to the drawing board. Like me, most farmers believe that their choice of a high-rate scheme was right. There was much criticism of that, but in the long term it is better than going for the historical scheme. The historical scheme may suit Wales or Scotland—I do not wish to enter a debate on that—but, given two difficult options, it was right to choose an area payment scheme. Ultimately, it will free farmers to be much more responsive to the market. However, it would be wrong to act over the bodies of many hundreds of hard-working farmers in the upland areas who look after the landscape that the British people most appreciate. I urge Ministers to reconsider.
9.47 am
Mr. Alan Hurst: I congratulate the hon. Member for Hexham (Mr. Atkinson) on securing the debate. As he rightly said at the outset, there have not been as many debates on farming in recent times as there were when I first came to the House. That may be encouraging in some ways, in the sense that the more debates there are, the worse the state of the industry is. There is some indication that its state has improved a little during the past two or three years.
I often think that farming is somewhat similar to a slow-moving rollercoaster, except that the downs seem much steeper and more protracted than the ups. Farming is a unique industry in many ways, in that it is subject not only to economic trends but to disease, taste, fashion and, most of all, weather. These days, it is also subject to environmental concerns. In many ways, being a farmer is like operating an agricultural fruit machine—all the elements have to be up at the same time to have a successful business. There are not many times in our history when that has been so.
Governments have always been concerned about the uncertainty in farming. My knowledge of Roman history is not sufficient to say whether Romans tried to protect agriculture, but I suspect that they did. Certainly, within the past 150 to 200 years, there have been various schemes of Government intervention to protect and secure stability for farming. The Conservative party will be painfully aware of the corn laws and their abolition, which damaged the party so much and provided such success for its greatest leader, Mr. Disraeli. That showed that there is always a conflict. On the one hand, one wishes to protect, promote and
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secure certainty for farmers, but on the other there are manufacturers and consumers who want cheap food. That conflict is sometimes difficult to resolve.
Modern times have made things worse for the farmer, although listening to farmers, it can seem as if nothing makes things better. The coming of the steamship made the situation worse, as it brought in food from competing overseas countries that had better climates than ours. Refrigeration must have been one of the biggest curses of all. It allowed meat to be imported from the other side of the world in competition with that which was slaughtered at the bottom of the lane.
Farming prosperity has not always, if ever, been associated with national prosperity. There have been periods, such as the 1920s, when the country as a whole was doing relatively well but farming was doing badly, while in the 1930s, the country and farming were both doing very badly. It was only with the second world war and the Labour Government after it that a serious attempt was made, with the introduction of national subsidies, to provide stability and prosperity for farming. Anyone who has been in politics for a little while will have heard the story of the Norfolk farmer who in 1948 applied to join his local Conservative club. The secretary told him that he had to be a Conservative, and the farmer replied that he had always been a Conservative. The secretary then asked, "Well, why haven't you applied to join before?" to which the farmer said, "It's only since the blessed socialists have been in that I can afford the membership fees."
After the war, farming entered a period in which the Government were concerned about its future and were keen to help, not only for the industry but for national security as they believed that the country needed to produce a large part of its own food. From the 1940s until recent times, with one or two exceptions, farming has been much more prosperous than before. As national subsidies were replaced by the Common Market and the common agricultural policy, the subsidy element remained, although it started to produce problems for farmers and consumers. As we know, all newspapers—not just the tabloids—like to mention wine lakes, butter mountains and all the other things that they, in a facile way, see as the consequences of intervention. However, one wonders how much of our farming industry would still exist without that intervention, subsidy and support.
During the past few years, we have seen a particularly unpleasant depression in agriculture. I cannot speak with any authority on grouse shooting, as it is not a sport that is greatly followed in Essex, as the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) can confirm, but diversification is one way that farmers have been urged to go forward. However, there is a limit to diversification, and I sympathise with the hon. Member for Hexham. His farmers may not be able to diversify as readily as those who are situated close to large urban areas.
Farmers have also been urged to follow niche markets, and a farmer in my constituency has successfully gone into ice cream manufacture from being a dairy farmer. She has done well and is an example of a farmer successfully finding a niche market and diversifying. However, there is a limit to that, because they would not be niche markets if everyone took part in them. However much we may promote

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diversification and niche markets, we must be aware that agriculture is dependent on livestock and the growing of crops.
From the mid-1990s, and certainly from 1998 onwards, all sectors were in depression, which is more common than it used to be. When farms were more frequently mixed, if one sector was depressed, farmers could move to another sector that was not depressed. However, the mixed-farm principle has fallen by the wayside, so the opportunity to move does not exist, and when all sectors are depressed, it is impossible to move.
When I spoke to pig farmers in my constituency in 1998, they told me that the price that they received was about 55p per kilo, while the break-even price was 90p, so they were making a loss on every pig that they produced. Although those who stayed in production are now making more than 100p—more than the break-even price—the goalposts have moved, as they so often do. A rise in prosperity elsewhere has led to a rise in the price that pig farmers pay for feed—one sector's prosperity has cut the other's profit margins.
None the less, it is good to see improvements. Even three years ago, the price of grain was way below break-even price, but it is now profitable again. Several factors are behind that: some are climatic, some relate to the position of our competitors, but all are variable. As the hon. Member for Hexham said, the fact that the factors involved continually change makes it difficult for farmers to plan for a long-term future.
The new scheme has now been unveiled, and I agree with the hon. Gentleman that there is a general welcome in England for its broad-brush approach. However, there are questions about the details and about how the scheme is applied. I am in no position to comment on hill farmers' problems, although my parents lived in a hill farming area for several years. Whenever I visited, I dreaded going to the chapel with them on a Sunday afternoon, because the congregation consisted of hill farmers, who would invariably give me a terribly hard time. They thought that if it rained too much, it was bound to be the Government's fault, but that if it did not rain at all, it was also the Government's fault. None the less, I fully understand the problems that such farmers have faced, and the addition of foot and mouth, which was particularly prevalent in hill country and in the west country, brought devastation to them.
I think that I understand how the new scheme works, although anyone who attempts to examine economic and agricultural matters probably needs a PhD and at least five years at university. Indeed, the language involved would probably qualify as a second language in any school of linguistics. As I understand the scheme, however, we essentially end up with a lump-sum payment. Two elements are involved. One is historical, and I understand why it has been rejected. I remember from my schoolboy A-level history that one reason for Spain's decline was that its procedures were frozen so much that there could be no innovation. If the payment had been fixed to reflect what happened in the two years at the beginning of this century, those who were debating the formula halfway through the century could well have some questions about that. There can also be an element of artificiality as regards how one gets to the position when those years come in. The Government
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were therefore right to have the balance scheme followed by the tapering, so that the historical element will disappear over time.
The question is what follows from that. Once we say that we are paying not for production but for the guardianship and use of land, certain matters arise. I therefore have one or two questions for my right hon. Friend the Minister. What, for example, will happen to historically unsubsidised sectors? Pig breeding is historically an unsubsidised sector, but is there not a case for those who breed pigs on open land to look for payments? There is a range of non-subsidised sectors, such as fruit growing. Given the principle behind the scheme, are such sectors also to receive payments?
How can the scheme be adapted to encourage new entrants into agriculture? Some elements of the scheme remind me slightly of milk quotas, and there is obviously a financial value to farmers in passing on land that incurs payments. We need to think about how to attract new people into agriculture. Indeed, that is one of the major difficulties that we face. The average age of farmers is higher than the average age of Members of Parliament—it is an ageing profession.
Then we must consider the price of land. Have we considered the effect that the scheme will have on the price of agricultural land? In many ways, agricultural land is an artificial commodity; it is almost a mirage—I should not say that lest there is a land crash. A farmer could earn as little as £15,000 a year from 300 acres, which is an absurdly low figure. Farmers must either have the most astute accountants in the land or must be working for below the minimum wage. For a farmer, an income of —15,000 a year from 300 acres is not a good return on the land. Logically, the price of the land should be much lower, and if we worked out the cost of renting land at an economic price, I do not know how many farming businesses could make a profit.
A further question for the Minister to consider is that of cross-compliance. What connection is there between the environmental schemes that operate and on which payments will ultimately be conditional? What schemes will there be and what level of compliance will be required? Will existing environmental schemes continue or will they be merged into one overall scheme? Will additional payments be made if farmers go beyond the standard level of compliance with environmental regulations? What will be the level of inspection for compliance with environmental demands? Will it be a burdensome or a relatively relaxed regime? Will the regime make farmers feel like they are in partnership with the Government, or will they feel at odds with inspectors?
That brings us on to a matter that is always raised: what will happen about our competitors? Farming does not operate in a vacuum or, to use a jargon phrase, in a national envelope; it competes internationally. Will we operate on the same terms as our competitors? Will our competitors give environmental subsidies for compliance with environmental requirements? I hope that the Minister will reply to those questions.
Let me return to the unsubsidised sector of pigs. The Government have introduced helpful initiatives, for example the home-sourcing initiative through which allowance is made when offering contracts for the benefit to the local community and production

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standards. Will that be more widely and strongly encouraged? Will greater attempts be made to stimulate proper, effective labelling of products so that we know what we are buying?
I generally welcome the approach that the Government have taken, but we need more flesh on the bones so that it is clear in what direction we are going. The Government, and all parties, are mindful of the difficulties that farmers have endured over a long time, and we are pleased that times are better now than only a little while ago. I look forward to hearing the Minister's replies to my tentative questions.
Several hon. Membersrose—
Mr. Deputy Speaker: Order. Back-Bench Members who want to contribute might wish to know that Front-Bench contributions should start no later than 10.30 am.
10.4 am
Mr. Patrick McLoughlin: I congratulate my hon. Friend the Member for Hexham (Mr. Atkinson) on securing this timely debate. It is timely because of growing concerns, especially in severely disadvantaged areas, on which I want to concentrate this morning. It cannot be emphasised too often that our countryside exists because of our farmers. They have looked after it from generation to generation and from season to season.
One of the reasons why so many millions of people visit my constituency in the Peak district is to enjoy the beautiful countryside that generation after generation of farmers has bequeathed to us. That can be neither emphasised nor repeated often enough. Too often we take the countryside for granted and imagine that it is beautiful because nature has made it so. However, the countryside is as it is because it has been maintained and farmed. One need only look at barren land that has not been looked after for a few seasons to realise that if the countryside and our national parks were not cared for, they would not be the attractive places that millions upon millions of people from different parts of the country visit every weekend. That is why I should like to concentrate on the Government's proposals for the SDAs.
It is essential that the Government get the policy right. I would like to believe that they have made a genuine and honest mistake, perhaps through misunderstanding the difference between disadvantaged areas and severely disadvantaged areas and the moorland line. The Government have made a mistake in their definition. The hon. Member for Braintree (Mr. Hurst) said that the issue is complicated and I have no doubt about that. Indeed, one of my constituents wrote a letter to the Department for Environment, Food and Rural Affairs to ask how the SDAs first came up. He received quite a long reply from someone working at the uplands land management branch on Horseferry road, from which it is worth quoting. The letter said:
"I understand that the present SDA line dates back to early the 1960s. It was then called the Hill Cow Line. Farmers within this were eligible for hill farming subsidy payments and capital grants"—
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as my hon. Friend the Member for Hexham said. The letter continues:
"The subsidy system started much earlier than this in the late 1940s but was paid, I believe on the breed of livestock rather than within a specific hill area."
I shall not read the entire letter, but it goes on:
"In 1984 the EC changed the criteria for LFA designation and the UK reviewed the line. The new criteria included 'agricultural disadvantage' and rural areas of less than a certain population density and danger of depopulation. It was at this time that the LFA was split into Severely Disadvantaged and Disadvantaged land. The land bordering the existing LFA, now called SDA was assessed. The criteria being that it was eligible for LFA if it was suitable predominantly for suckler cow and hardy sheep rearing. Arable areas could be included if the crop was for on-farm feed. This usually corresponded to Agricultural Land Classes 3c. 4 and 5. There was a presumption against including dairy land unless conditions were particularly difficult, e.g. significantly longer in-wintering period. The SDA land was not reassessed. It was presumed that it … fulfilled these physical criteria, even though some areas would have undergone significant land improvement over the years. Again, there was still an economic advantage being in the SDA.
The LFA was reviewed in 1990 and, as far as I am aware there were little or no changes of substance. The EC required the area be described by listing the parishes … that lay wholly or partly within the line drawn. These were notified to the EC in 1992.
Flagg Hall farm lies at an altitude of 900–1,000 ft (270–300 m) above sea level, deeply within the SDA. Land normally at this altitude especially well away from the coast would normally be expected to be considerably"—
Mr. Deputy Speaker:Order. The quotation is extremely long and I think that the point was well made some time ago.
Mr. McLoughlin:The quotation helps me to make my point, but I shall draw it to a conclusion if I am out of order. I merely point out that the farm in question is now included in the SDA, yet its stocking level is compatible with areas outside the SDA.
At the weekend, I met farmers whose farms were partly inside and partly outside the SDA. That happens particularly often in my constituency. One can see on a map where the line runs through villages that only part of a village may be included. That means that neighbouring farmers are in completely different financial environments: some obtain a full benefit and others within the SDA receive a reduced amount of Government subsidy. The Government might argue that there should be no subsidy at all—perhaps they can argue that—but there is a subsidy. They have accepted that a subsidy will exist. They must therefore be sure that, when they arrived at the decision, they fully understood the whole question of the SDA.
The Minister for Rural Affairs and Local Environmental Quality: I should be grateful if the hon. Gentleman clarified what he is suggesting. It is surely inevitable that wherever one draws a line, there will be a difference between one side and the other, whether it results from devolution or the definitions of "area". Is he arguing for a single-rate payment?
Mr. McLoughlin:I am arguing that the Government should consider whether they became confused—let me be as kind as that—between the moorland line and the

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SDA line. Surely they did not mean to include in the SDA line areas where there are farms that provide the same quality of service and production levels as some of the areas outside it. That is totally incompatible with what the Government are saying. I do not believe that any farms within the moorland line could produce what some farms in the SDAs are currently producing, in both quality and quantity.
I fully accept that a great deal of work has gone into the policy and that there are difficult decisions to be taken. I could say much more on the subject and I apologise to you, Mr. Deputy Speaker, if I quoted at length from a letter, but it is relevant to the way in which the old SDAs have grown up over the years. They have a huge history. Part of the Government's problem is that, if they are relying on maps that were drawn, as we have heard today, in the late 1940s and early 1950s, it is a mistake. It would be wrong for agriculture to use such criteria.
My hon. Friend the Member for Maldon and East Chelmsford (Mr. Whittingdale), who speaks from the Front Bench, wrote to the Secretary of State to explain that more than 5,000 farms will be in danger from the proposal. That is absolutely right. They are, in general, smaller farms and farms that require much more labour, because they are hill livestock farms and arable farms.
The Government's proposal is a mistake: it will pit farmer against farmer and divide farming communities. I very much hope that the Government will reconsider the proposal as a matter of urgency and that the Minister will comment on that today, because there have been reports that the Secretary of State will be away from London for some time, and the issue is of considerable interest to farmers in my constituency, who are very worried about their livelihood. I therefore hope that the Minister will give us an idea of the timetable to which the Department is working if a review of the system is taking place. I hope that he will reassure the farmers whom I met in my constituency over the weekend that a review is happening. They hope that the Government are taking on board the many representations that they receive.
10.14 am
Matthew Green: I, too, congratulate the hon. Member for Hexham (Mr. Atkinson) on obtaining the debate, which is timely. Much of my constituency is a less-favoured area and much of it is a severely disadvantaged area. That has had a considerable impact. I have had no fewer than three meetings with the National Farmers Union in my constituency in the past couple of weeks, and received numerous letters. Farmers are not often moved to write to Members of Parliament, even when those Members have many farms in their constituencies, as I have, but I have been flooded with letters from farmers, because of the impact that the system has had on them.
I do not intend to oppose the Minister on the issue. In principle, decoupling is right. If it had been left to me, I would hope that we would not be in the position that we are today. However, I am taking it as read that we are in that position, and I hope that we can move on from it and smooth out some of the worst anomalies in the system.
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We have heard good examples of the problems caused by the single farm payment in the SDA areas. In particular, it is clear that livestock farming—suckler cows and dairy—in the SDA areas will be most affected. However, moving to area payments will hit livestock farming everywhere; livestock farmers will lose out the most, except those who practise extensive sheep farming in moorland areas. I would welcome recognition from the Minister that the change will affect livestock farmers the most.
I shall quote briefly from three letters from farmers in my constituency to give some idea of the scale of the problem. However, I shall not name those farmers, because the letters contain financial information. In the first letter, the farmer says:
"We farm 1,000 acres of LFA. You cannot class us as a moorland. We employ 4 people—they will be out of a job. We have 300 cows—they will have to go. My farm neighbours are English lowland, receiving £220 a hectare."
That is the estimated figure; the farmer estimates that he will receive only £72 a hectare. He continues:
"My Welsh neighbours are getting even more at £300 a hectare. How can I compete with that?"
Another farmer says:
"In 1999 I myself farmed 115 ha, running 800+ breeding ewes, 35 suckler cows and growing 12.71 ha of cereal, total subsidy before HFA and ESA payments of £22,891. At current projected levels, in the year 2012 the total flat-rate payment would amount to £8,625, amounting to a reduction of 62.3 per cent."
Another farmer, who has 1,300 sheep and 80 single suckler cows that are run on 229 hectares, says:
"Similar to many farms in the Clun Forest I have calculated a 70 per cent. drop in support payments under the proposed SFP. By 2012, 229 hectares qualifying for an estimated SDA payment of £75 as opposed to the estimated non SDA payment of £225, would see a shortfall of £34,350 a year."
The impact on individual farms in my constituency is considerable.
The environmental impact has already been mentioned. Mixed farms are regarded as being good for the environment and for the appearance of the countryside. However, many farmers, when faced with such a situation, will be tempted to move away from mixed farming into sheep ranching, which would have a considerable impact on the appearance of the countryside and the environment. I do not pretend to be an expert on the matter, but I understand, for instance, that orchids tend to grow where cows graze, but that if sheep are put on the same land, the orchids will disappear. The policy has many, perhaps unintended, consequences.
I shall not follow some Conservative Members in being too critical of the Secretary of State, because I understand that the National Farmers Union has had meetings with her on the issue, and have found her quite accommodating. I believe that she is seeking industry consensus about changes to the system.
Unlike the Conservative Members who have spoken, I shall not urge moving the current line to the moorland area, but shall propose the creation of three areas by separating the current SDA moorland area into two. That would be a lot fairer. The problem for the SDA farmers is that the moorland areas have been included, so subsidy will rise for extensive sheep farming on the

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moorland areas, paid for by a loss in subsidy on the mixed farms in the SDA areas. Separating the two would mean that the current subsidy received by the SDA areas would stay in those areas, because the principle is that the existing subsidy on that area is examined and then is divided between the area that can be claimed on. That is my understanding of the matter, and I hope that the Minister will confirm it. In the SDA areas that would mean that, if the moorland areas were taken out, the current subsidy received by the SDA areas would stay within those areas.
Mr. McLoughlin:Can I be absolutely sure what the hon. Gentleman is saying? Is he arguing that the SDAs outside the moorland line will still be treated differently to the disadvantaged areas?
Matthew Green:I could stand here and argue for four areas: lowland, disadvantaged areas, severely disadvantaged areas and moorland. The biggest problem is the inclusion of moorland in the SDA areas, so I am arguing for three regions: moorland, SDAs and the others, which would be DAs plus lowland. There is a problem with separating everything from moorland, because most SDAs will continue to receive hill farm allowance. There is concern that if moorland is excluded and everything else is similar, the argument for continuing to receive HFA payments in future would be rather tenuous. I do not want to throw the baby out with the bathwater, which is what a move to the moorland line would involve.
There was a meeting of more than 200 farmers at Ludlow football club last week with Kevin Pearce, the NFU livestock expert, in attendance. At the end of the meeting, there was a show of hands. About 90 per cent. of the farmers in the room—all SDA farmers—said that they would prefer the three-way split to the boundary move from the SDA to the moorland. They believed not only that that was more achievable, as the Government are more likely to agree to it—perhaps that is why they think that—but that it also seemed relatively fair to keep the SDAs' current subsidy within the SDAs. We do not know what the figures would be, but separating the SDAs out would probably bring them fairly close to what the lowland and DAs would be getting anyway. That could feasibly be even more so if the farmers' claims about high levels of subsidy are true. We must be careful about that.
I have a series of other questions, and if the Minister cannot answer them today, I hope that he will write to me, because they are matters of concern. Like the hon. Member for Hexham, I have a border constituency. Farmers in Wales have, for understandable reasons, opted for historical payments, and if I were in their position, I should have done so too. A more difficult question for them is how long that position can be sustained. Historical payments have led to a number of cross-border issues. First, the actual border and where the farms are registered are not always similar. For instance, when I was first elected, I was given a list by DEFRA of the number of farms with confirmed foot and mouth cases in my constituency. The list numbered four, although there were actually nine. The first Shropshire farm to get foot and mouth was near the village of Chirbury in my constituency, but it did not appear on the list because it had a Welsh holding
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number, even though the farm, buildings and two thirds of the land are in England. Can the Minister confirm whether such farms will be in England or Wales, or will they have split land? That will make a difference to the levels of payment.
Alun Michael:I can tell the hon. Gentleman that if the borders proposed by Owain Glyn Dwr had been observed, Exeter and most of the east of England would be included in Wales, and we would have a completely different picture.
Matthew Green:I thank the Minister for that, but I am not sure that it will be a great reassurance to farmers now. I realise that he may not be able to give an absolute answer today, but I should appreciate him writing to me.
Secondly, there is the issue of grass keep. A lot of Welsh farmers take grass keep on the English side of the border, and vice versa. If the Welsh farmers are receiving historical payments, they will be able to afford the grass keep more on the English side. There is also the issue that many farmers will want to keep the initial 90 per cent. historical payment on as small a unit as possible. They will retreat from tenanted land in the first year, so that they can claim their historical payment on as small an area as possible, and then perhaps return to it in future. We shall see some shifting around. Will the Minister consider that point?
Thirdly, there is the issue of market distortion. I have three livestock marts in my constituency, of which Ludlow is the largest. It is a successful sheep and cattle market, and many people from Wales go there. People will be able to offer—particularly with breeding stock and suckler cows—different prices for that stock in the market. I would appreciate it if the Minister would say something about the effects of market distortion.
The effect of the inclusion of improved grassland in the set-aside rules also arises now. Many dairy farmers have relatively small farms, but if set-aside is included in the improved grassland, they will probably have to take on more land so that they can set some aside. Previously, livestock farmers were not affected by set-aside, but they will be under the improved grassland proposals. I realise that it is a European directive, and not necessarily within the Minister's control, but recognising the problem and attempting to deal with it would be welcome.
We need more details about cross-compliance. I know it is early days, but much of farmers' planning will depend on what will be expected of them in respect of cross-compliance. The Minister will probably not be able to give firm details about it now, but I hope that he will at least reassure us that they will be available as soon as possible.
In the changeover period, 90 per cent. of the potential appeals will be historical; it is very important to get the figure right for the three-year reference period. Mistakes could be made by the DEFRA, which is the body responsible for appeals. It worries me that there is no independence of appeal, and I would like the Minister to comment on that.
I shall give an example of how problems could arise. A man who farms on a relatively small scale came to see me at my surgery on Saturday. During the outbreak of foot and mouth disease, his records were stolen from his Land Rover. He had recently received some annual

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sheep premium and the Rural Payments Agency had back-claimed from the three years that happen to be in the reference period. He had figures for 2002 and subsequent years, and he has his premium for those years. The Rural Payments Agency checked the figures for 2002 and because his previous records had been stolen, it subsequently claimed the money back because he could not prove that he had the sheep during the important month or so in the relevant period.
I am worried that that farmer, who has been in farming for some years, could be doubly hit. I will take up the issue with the RPA to try to resolve the matter, but if we fail, he will have no historical payments because he has had his subsidy removed for the reference period. That will be serious because it will penalise him over a future eight-year period. The sum involved may not seem particularly large, but it is large to him as it is an important part of his income.
I hope the Minister appreciates that I am not trying to be oppositional. This is an important change; it is difficult to get it right and the Government are adopting an open-minded approach. I understand that the NFU is encouraged by the way the Government have responded to some of the difficulties, but I should like more assurance from the Minister that they are moving to deal with the problems of severely disadvantaged areas. I hope that the Minister will look carefully at the three-region option, which was heavily endorsed by SDA farmers in my constituency.
10.29 am
Mr. Roger Williams: I, too, congratulate the hon. Member for Hexham (Mr. Atkinson) on securing the debate, which comes at an opportune time. I warm to his comment that we have not had a debate on the Floor of the House about agriculture and I go so far as to suggest that if there had been such a debate, some of the problems that have been encountered with the SDA might have been sorted out, or at least identified, so that DEFRA would not have to reconsider the proposals. I declare my interest in such matters as they appear in the Register of Members' Interests.
I enjoyed the short history of agricultural support from the hon. Member for Braintree (Mr. Hurst). I have been farming for a long time, but not during the abolition of the corn laws or in the 1920s and 1930s. I farmed while the system of deficiency payments was in operation, during intervention and export restitution and through the McSharry reforms and Agenda 2000. We are now looking forward to the new proposals. It would be perverse not to recognise that farming incomes have risen, albeit from very low levels. The current levels have been reached through better livestock prices, particularly for beef and sheep, and a short-term rise in corn prices, which have made farmers' incomes look more respectable, although they are nowhere near the levels of the early 1990s.
The one commodity that remains poorly recompensed is milk. For several years, milk farmers have sold their commodity at below the cost of production. Although individual farmers will have different costs regimes depending on whether they are
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owner-occupiers or tenants and their borrowing history, an estimate by the HSBC bank suggests that, on average, they have been selling milk at 2p below the cost of production. If that is multiplied by the amount of milk produced in the country it comes to £280 million; that is the amount by which the farmer subsidises the wholesale, retail and processing trade.
What can we do about that? I have one suggestion for the Minister. After the abolition of the Milk Marketing Board and the break-up of Milk Marque, farmers' co-operatives were reduced in size and did not have the economies of scale of a number of their competitors. It was suggested that individual farmers' co-operatives that decided to merge to give them a better competitive position in the industry would be referred to the Office of Fair Trading. Answering the OFT's questions would immediately cause huge expense for those farmers' co-operatives. That is a barrier to a better structure in the milk industry. Farmers believe that to be unfair when they consider the red meat processing industry, in which Grampian Meats has 50 per cent. of the market, having just purchased St. Mirren Meats. There seems to be one rule for the private sector and another for the farmers' co-operatives.
Matthew Green:My hon. Friend is probably already aware that when the DTI looked at the competition implications of Dairy Crest's recent acquisition of ACCA, it considered only the impact on the retail price for the consumer, not the impact on producers.
Mr. Williams:My hon. Friend raises an important point. In the short time that I have available, I should like to put it to the Minister that the OFT should be more transparent about what triggers an intervention. At present many farmers' organisations are afraid to go forward because of the huge expense that an OFT investigation entails.
The mid-term review is a huge opportunity for the farming industry. It will allow farmers to become business people and run their businesses according to their resources and skills, rather than being collectors of Government subsidies. It has been welcomed by the industry. We have four systems in the devolved nations of the UK. I recognise the problems on the borders between Northumberland and Scotland and between my hon. Friend's constituency and mine. Several issues will be difficult to sort out there. The devil will be in the detail. We could raise several matters here but I am sure that the Minister is well aware of them.
The SDA has caused a huge amount of concern. When the Secretary of State made her statement on the mid-term review, I was the only Member to raise the SDA, because I could see how it would affect the more intensive livestock farms as opposed to the moorland and grouse moor areas. If a Labour Government could think of any scheme to fill large landowners' bank accounts with subsidies, it would be that one.
I asked the Secretary of State about livestock SDA farms—the smaller upland farms that are the most vulnerable in terms of business, but contribute the most to the environment. They are, as the hon. Member for West Derbyshire (Mr. McLoughlin) said, situated in some of the highest-quality landscape areas, but those landscapes exist only because of the farmers' activities.

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British people value those landscapes. That is why they go to national parks in the north and west of England, and in Wales. Any exodus from those farms because the farmers' businesses became untenable would lead to a huge outcry from the British people, as they would see their landscapes and countryside changed beyond recognition.
There are several other issues of concern, such as cross-regional matters. Simon Gourlay, who is a past president of the National Farmers Union, and who farms on the Welsh border, suggested that wherever the main farmhouse is situated should be the designation for that farmholding. I know that he has written to DEFRA and the Welsh Assembly about that. Will the Minister comment on whether that would be a simpler way forward? I understand that most people, particularly if they are in SDA areas in England, would like to be on the Welsh side of the border at the moment.
Let me consider more technical issues concerning the mid-term review. I understand that Britain would contribute £485 million in digression and modulation funds, but would receive only £445 million back. That would not be enough to fund the agri-environment schemes as they are currently envisaged. Will the Minister comment on that?
I revert to an issue that has concerned me for many years, but about which I have always been regarded as old-fashioned: food security. It was at the forefront of consideration immediately after the war, in the 1950s, when agricultural policy was being decided. I do not think that we should ever forget that a hungry nation is a dissatisfied nation. We often talk of global warming and other issues; I hope that the modulated income will be used to ensure that support will continue for breeding flocks of sheep and herds of cattle, because there could be a time when farmers will become commodity brokers in livestock, and breeding will be so unprofitable that there will be a huge decrease in livestock.
The other day, I asked some young farmers what they would like to ask the Minister. The main questions that emerged were: why is not the Minister more proud of British agriculture? Why does not he celebrate the food that it produces and the way in which it looks after the countryside? If he did that, the relationship between the Government and the British agricultural industry would be a happy one.
10.39 am
Mr. John Whittingdale: I begin by joining other hon. Members in congratulating my hon. Friend the Member for Hexham (Mr. Atkinson) on securing the debate. By doing so, he has done us a service. I share the view that it is a shame that the debate was not held earlier, and that we have not had an opportunity in the main Chamber to talk about undoubtedly the biggest change in agriculture for many years. My hon. Friend is a member of the Conservative Whips Office, and was supported by the Conservative Deputy Chief Whip. Both their contributions were excellent and got to the heart of the matter.
We have had a well informed and useful debate. The hon. Member for Braintree (Mr. Hurst) is my constituency neighbour. We may have different views
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about many issues, but he has always shown great understanding and knowledge of farming. It is always a pleasure to listen to him talking about the subject.
The mid-term review will affect every farmer. I repeat that, in the main, the Conservatives support the principles that underline it. We have always argued for decoupling, and the fact that it will take place at last is a considerable achievement. I do not underestimate the difficulty of implementing that decision. The Secretary of State had a very hard choice to make. However, the key decision to take was how to allocate the single farm payment. Whatever the method chosen was bound to result in some being winners and others being losers. No major group rejected the method that the Secretary of State eventually chose; most reluctantly accepted that there is some logic in the gradual phasing in of a flat-rate payment system.
A flat-rate payment system should be fairer, as it removes the divide between some supported crops and non-supported crops. It should be simpler, although I share the concern expressed by the hon. Member for Ludlow (Matthew Green) that we have not yet seen the detail, particularly of the cross-compliance conditions that will be attached to the payment. We will be keen to ensure that we are not substituting one complicated bureaucracy for another. We are also concerned about the time scale that must be introduced, and whether or not the Rural Payments Agency will be up and running and ready to implement a major change. I hope that the Minister will assure us that he is confident that the RPA will be able to put the necessary mechanisms in place.
Farmers in England accept the logic of the change and the system that the Secretary of State has chosen, but there is still unhappiness that farmers will be treated differently. Obviously, there will be differences throughout Europe. We have moved towards full decoupling, but other countries have not, which will create an unlevel playing field throughout Europe. There will also be major differences in the United Kingdom. We will no longer be able to say that there is a common agricultural policy in Europe. The fact that two identical farms on either side of the Scottish or the Welsh border will receive different amounts and that, over time, the gap between the amounts that they receive will grow will give rise to the feeling that this is unfair and that there is no equity.
I accept, however, that all farms will be faced with the same decisions because they will all be operating in a world market. Nevertheless, the fact that one farmer receives a much greater payment than another for the same environmental management is bound to lead to resentment. We have heard about farms that not only neighbour each other across a border but actually straddle borders. That will give rise to even greater resentment. Some farms have some land in Wales and some in England, some of which is inside an SDA and some outside. One example that has been drawn to my attention is that of a 600-acre Shropshire dairy farmer who has 250 acres in an English SDA, 150 in the west of England and 200 in Wales. He will receive three different entitlements for those three blocks of land, and his farming decisions will be determined not by the market but by how he can maximise his subsidy.
Part of the rationale behind the mid-term review is that it was supposed to result in a situation in which farmers decided how to farm on the basis of what they

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could sell in the market, not on the basis of how they could maximise their subsidy payments. I am sure that the Minister will tell me that the distortions are the result of devolution and that devolution can mean different systems for different areas. However, there is the additional difference between the payments inside the SDAs and those outside, and that is wholly the Government's decision.
I understand the intention behind the Government's decision to pay a lower rate in the SDAs than outside. However, some of the biggest gainers will still be those who own large expanses of relatively uncultivated land, particularly grouse moors as mentioned by my hon. Friend the Member for Hexham. The Government have tried to meet the consequence by implementing a lower rate in the SDAs, but my concern is that they seem not to have realised that there are a large number of intensive farms within the SDAs. Those farms will see a catastrophic drop in their income.
I was concerned that, when Lord Whitty gave evidence to the Select Committee on Environment, Food and Rural Affairs, he appeared to say that no research had been done into the effect of the changes on individual sectors. He said:
"We know what the overall effects will be but we do not know, and have not the modelling to show, the effects on individual sectors".
It is strange that we have taken such a momentous decision for farming apparently without the Government having done that research.
Yesterday, I met representatives of the Royal Association of British Dairy Farmers, who told me that there are 1,500 dairy farmers in the SDAs and that they are all likely to go out of business unless changes are made. Some of those farmers have done everything that the Government have wanted them to do. I was given the example of Wensleydale, with which I am sure my hon. Friend the Member for Hexham will be familiar. Farmers there came together to form a co-operative and are now supplying the makers of Wensleydale cheese. Those farmers have done everything that the Government have asked of them: they identified a niche market and are working together to produce a value-added, high-quality product. Half of them happen to be in the SDAs, and as a result, they will almost certainly be unable to continue in business.
That problem affects many areas of the country, including the west country, Exmoor, the Welsh borders and Northumbria, as my hon. Friend mentioned. They are some of the most beautiful areas of England, although the hon. Member for Braintree and I also see a curious charm in the East Anglian arable fields. Some of those beautiful areas depend heavily on farming for the maintenance of their environment, so the change will have a severe environmental impact as well.
My hon. Friend the Member for Hexham mentioned that one of his constituents is Sir Donald Curry, who has done great work in advising the Government and made sensible recommendations about the future of farming. However, he has said that he was not consulted about the decision:
"I am concerned and have had numerous calls and letters about it. The level of redistribution within the SDA is unacceptable and unforeseen."
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The Government should take that seriously, and I hope that they will show flexibility. When I raised the issue on the Floor of the House with the Secretary of State, there did not seem to be much flexibility, but I am encouraged by the reports that, privately, she accepts that some movement is needed.
There are various methods of addressing the situation. My hon. Friend the Member for Hexham mentioned the possibility of increasing environmental payments, the National Farmers Union advocates three tiers rather than two, and there is the suggestion that we use the moorland line. All those proposals will have costs attached to them, and one difficulty is that we do not have any analysis of how the payments in, for example, non-SDA areas would be affected if we made those changes. I hope that the Minister will be able to say a little more about that, because it is important that we have those facts. Everyone agrees that something needs to be done. The Government, I suspect, have simply not realised the effect of the decision on thousands of extremely productive farms in the SDAs, which make a vital contribution. I remind the Minister of the opening words of the Farmers Guardian editorial:
"Anybody can make a mistake but the true test of a person, or indeed a Government, is the way you respond to it."
10.50 am
The Minister for Rural Affairs and Local Environmental Quality: I congratulate the hon. Member for Hexham (Mr. Atkinson) on initiating the debate, and I agree with one of his early comments, which was echoed by the hon. Member for Brecon and Radnorshire (Mr. Williams) among others. He said that although the contribution of farming to the rural economy is quite small, the contribution of farming to the countryside and the environment is enormous. That is why decoupling and paying farmers for the public benefit, rather than giving them a production-related subsidy, must be the right long-term way forward.
I welcome the hon. Gentleman's support for the area payment approach, as opposed to the historic payment approach. The hon. Member for Brecon and Radnorshire suggested that there was concern among young people that we were not sufficiently proud of British farming. Perhaps that is because of the great coverage of all that is gloomy and negative about it, when there is much positive that could be said. We have every reason to be proud of the farmers—people I meet all the time—who are entrepreneurial and creative, as well as highly committed. All that the Government are doing is trying to help them to be competitive and successful, and have a sustainable future in farming.
It is worth pointing out that farm incomes should be viewed in the context of considerable public support for agriculture. United Kingdom farmers receive about £3 billion in payments under the common agricultural policy each year—£2.5 billion in direct payments and £500 million in budgetary expenditure on market support. The Government's policy is not to attempt to intervene in the market to create artificial income, but to facilitate the right economic framework to enable farmers to succeed. Reference has been made to Sir Donald Curry's excellent work on that, and the

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Government's sustainable farming and food strategy sets out how we mean to work in partnership with the industry in that context.
Although there are many positive things that can be said, I want to focus in the short time available on the points that have been made by hon. Members. First, the general message seems to be positive, but each hon. Member who has spoken seems to be concerned about some of the detail of the impact of the proposals of my right hon. Friend the Secretary of State.
The hon. Member for Hexham concentrated in particular on upland farmers and the effect of a two-area approach on those in severely disadvantaged areas. He makes a reasonable point. He and others, including the hon. Members for Ludlow (Matthew Green) and for West Derbyshire (Mr. McLoughlin) have argued for a different alignment in England. I stress that we shall consider all the representations and the points that have been made to us. That is the point of a period of listening.
Hon. Members must nevertheless bear in mind that change would produce a different set of winners and losers. I do not think that it would be terribly helpful to add to rumours of the possible shifts and changes. Let us engage in conversations and examine the representations. Let us consider what consensus might be reached in the industry. Then, as always, my right hon. Friend the Secretary of State will want to focus on all the information that has come in, and to take a decision.
I assure hon. Members, in answer to a query that arose, that during the period when my right hon. Friend will be representing this country in several European, and other, settings, she will be well in touch with the Department and her ministerial team and will be focused on securing the right outcomes.
The hon. Member for Ludlow also focused on specific cases with a lot of detail, but seemed to argue for a retention of the link to stock levels, when decoupling is the way forward. Perhaps that point was being made by his correspondent rather than by the hon. Gentleman, but I shall certainly respond to him on the detailed issues that he raised. For instance, he referred to a case involving the Rural Payments Agency. It is my experience that, generally, comments about the agency based on the detail of individual cases can be misleading, although I should be happy to write to him about that point.
Mr. McLoughlin:The Secretary of State made her announcement in February and the Minister says that the Government are collating evidence and listening to all sections of the industry. Can he give us any idea of when the industry can expect a clearer way forward? What the Secretary of State announced obviously stands. However, if there is to be a review, it will be immensely helpful for those who are worried in the industry to know what time scale the Minister is considering.
Alun Michael:The hon. Gentleman and others have rightly referred to our discussions with farming organisations, including the National Farmers Union. However, it is wrong to talk about outcomes and
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changes while those discussions continue. My right hon. Friend is looking to make the right decision and to understand fully the points that are put before coming to a conclusion.
The hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) acknowledged that any decision would cause problems. He also acknowledged the logic of a tapering approach that seeks to move to area payments, but in a way that gives people time to adjust to the changes in payments. He referred to the differences across the Welsh and Scottish borders, as well across the lines in England. However, the decisions made in Scotland and Wales are the result of devolution. It is understandable that such decisions have been taken, because, as the hon. Member for Brecon and Radnorshire suggested, the historic payments may look more attractive in the short term. In the longer term, however, the area payments are, in our view, much more sustainable. Those who perhaps aspire to see such arrangements across the border, such as the hon. Member for Ludlow, may therefore take a different view in the longer term.
A number of detailed questions were asked, for instance, about cross-compliance. It is necessary to consider the relationship among the higher tier scheme, which involves more complex agreements, the simple voluntary scheme that is being promoted and cross-compliance, in which the minimum regulation standards are observed. A consultation on cross-compliance is due to take place shortly. That process will bring forward the details for which the hon. Member for Hexham asked and will provide an opportunity for comment and discussion. One problem is that there is always a lot of consultation when dealing with issues that are so complex for the industry. During the consultation, people complain of uncertainty, but we cannot have it both ways. We must listen and get engaged with the sort of detail that several hon. Members have raised.
I am conscious that the time I have to respond to a broad range of issues is short. I therefore undertake to write to those who have spoken to cover the points that I do not manage to reach. For instance, the approach of the Rural Payments Agency was raised. The agency has established a programme and project management system in order to deliver single payment systems by 2005. The set-aside on grassland was also mentioned. We are still discussing the rules, but we argue that the Commission should look again at its proposals, so the issue is not closed.
On the key issue, I must tell the hon. Member for Hexham that no line will be perfect; there will be anomalies somewhere, whatever lines are chosen. We shall listen carefully and ask whether there is a better way. My right hon. Friend the Secretary of State has put forward a sensible and coherent set of proposals. Following the consultation, we shall seek to give the greatest clarity to the industry, which is what all hon. Members want. We need a process that is sustainable in the long term, in which, as we move to the simple area system, people know the graduation of payments, and that will help to provide the certainty that is necessary to underpin a sustainable future for farming and food.

Supermarket Code of Practice
11 am
Andrew George: I am pleased to have secured this debate, and delighted to see the Minister. I have seen him in this position before, when he was goalkeeping behind me for the House of Commons football team, so I know that he has a safe pair of hands to assist him in responding on this important matter.
Today is an important day for me not only because of this debate: in the Lower Waiting Hall, there is an exhibition of Cornish cuisine, and one point that I want to make relates to the importance of farmers co-operating and coming together to promote a brand, and of achieving vertical integration through the supply chain.
Let me give the background to this short debate on the supermarket code of practice. The Select Committee on Environment, Food and Rural Affairs, both in the cross-party report on gangmasters that it published last September and last December, has identified that supermarkets can dictate market conditions. On 10 October 2000, the Competition Commission produced a report identifying the fact that supermarkets represented a complex monopoly practice, and proposed that a code of practice be established. After what I believe were a number of drafts, a code was finally published on 31 October 2001. However, according to those involved in the process, particularly from the supplier side, it was a rather watered-down version of the code that was originally proposed by the commission.
The Office of Fair Trading announced in February 2003 that it would review the success of the code's progress, and it published its report only a few weeks ago, on 20 February. What it found was no surprise to people on all sides who had been watching what was happening with the code, including suppliers, who had caused the code to be established, largely through the complaints that they made about their treatment.
The main results of the OFT review were as follows. The code was not working effectively: 80 to 85 per cent. of suppliers who responded to the survey claimed that the code had failed to effect any change in supermarket behaviour, despite the recommendations of the Competition Commission's 2000 report. However, there was no hard evidence that that was the case. Some 73 per cent. of suppliers reported a fear of complaining, which was the main reason for the code's lack of effectiveness. No cases had been brought under the code's mediation process by suppliers claiming a breach of the code. One case was brought, but it related to a contract established before November 2001, which I understood was the start date before which past contracts could not be included, so the code was not used. A number of aspects of the code were criticised, including the rather vague term "reasonableness" and other subjective terminology that was open to wide interpretation.
Rather worryingly, the OFT analysis also included the following statement:
"We do not believe that there is anything in the changes in the fortunes of UK farmers, especially the amounts they are paid for their produce, which can be linked to the code or the general behaviour of the supermarkets."
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The review pointed to BSE, foot and mouth disease and the strength of the pound against the euro, rather than farmers' treatment by supermarkets, as largely responsible for farmers' misfortunes. However, farmers' organisations rightly question the assumptions behind the suggested source of their misfortunes. Two of the problems—BSE and foot and mouth disease—affect only red meat consumption and have very little impact on other sectors. Furthermore, fluctuations in the exchange rate have not resulted in fluctuations in price. If the problems had anything to do with the strength of the pound, there would be the same fluctuations in price as there have been in the exchange rate, which has not happened. Supplier organisations strongly believe that consolidation of agriculture downstream has affected the proper operation of the market.
I have read the OFT report and spoken to many farmers and farmers' organisations, and to others working in the supply chain. Many people have provided me with case material, but I could not use it even today for fear that they could be identified and delisted, or lose contracts with buyers in the future. However, one does not have to be Sherlock Holmes to identify serious problems in the way in which the market operates. Farmers face particular challenges. They produce perishable goods, even in the case of livestock that are ready for slaughter. Growers produce goods that are ready for harvest at very particular times. They depend on their buyers playing ball and sticking to their contracts and the nature of those contracts.
Mr. Elfyn Llwyd: I congratulate the hon. Gentleman on raising this issue.
The hon. Gentleman describes the worst effects of an unbridled monopoly. Is he aware of the report published recently by the New Economics Foundation, which states:
"270 jobs are lost each time a supermarket opens"?
Worse still, it states that
"50 farmers and small traders are forced out of business every week"
by the operation of the big four.
Andrew George:I am grateful for that intervention. I was not aware of that finding, although I am not surprised to hear it. The main purpose of the debate is to examine the effect on the supplier side, however, and not simply the impact that supermarket chains undoubtedly have on other traders in the environs of sites where they establish new supermarkets. I do not doubt that some studies have identified a net job loss rather than a net job gain in the wider economy, and that supermarkets would want to debate that issue.
My point is that supermarket practices place farmers in a particularly difficult situation. For example, farmers and growers have to buy the packaging materials that supermarkets use, and often they cannot do so at cost price. Many farmers know full well that they are being charged for packaging that may simply be a plastic bag in which to put broccoli or a cauliflower, and that the supermarkets are charging them more than the cost price of those materials as a way of recouping money. Payments are also often delayed. On 17 January 2003, the Financial Times published a study into supermarket power. On page 17, the study said that in 2001, Tesco,

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Asda and Sainsbury's alone extracted an additional £623 million from suppliers through longer credit terms. Supermarkets are obviously in a strong position to negotiate better credit terms.
Retrospective conditions are often added to contracts. Suppliers often do not even see their contracts. Suppliers who want to keep their contract may have to make unexpected contributions to promotions of the sort that I am sure we have all seen, such as "Buy one, get one free" or "Buy one, get one at half price." Farmers often make the major contribution enabling supermarkets to make such offers. Farmers might also have to deal with consumer complaints and with recompensing the consumer. It is sometimes unclear, particularly in the case of perishable goods, whether the cause of the problem lies with the handling and storage arrangements at supermarkets rather than with the farmer who supplied the goods.
There is often a problem with contracts being changed at short notice. Contracts are sometimes ended after the plants are already in the ground or ready for harvest. That happened recently to a supplier not many miles from my constituency. There has also been threatening behaviour.
Mr. Roger Williams: Does my hon. Friend agree that not all farmers deal directly with supermarkets? They may deal, for instance, with slaughterhouses that have direct contracts with the supermarkets. Such farmers could be in a weak position because of the monopoly of the supermarket even though they do not deal directly with it.
Andrew George:My hon. Friend makes a good point. Particularly in the red meat sector, it is noticeable that, with consolidation, some of the sector is growing to such a level that it can negotiate better deals and better contracts with the supermarkets and use its market muscle, but it is true that many farmers supplying to slaughterhouses have to be extremely careful.
In one case, a grower decided to switch his supply to another co-operative that was supplying another supermarket. He received a threatening letter from the original supermarket saying that it would make sure that he never supplied any source that was a source for the other supermarket. It ultimately apologised for the letter and withdrew it, but the fact is that we know that such practices go on. There is a severe fear of de-listing. That happens throughout the food chain; it does not apply only to the suppliers. Other food supply organisations and representatives, some of which are very substantial names and businesses, have raised similar concerns and fears in briefings to me prior to this debate.
The consumer has an important role to play. There is a general impression—indeed, the OFT gives us the same impression—that the consumer is a two-dimensional person who is interested only in price and nothing else. My own impression is that consumers are much more sophisticated. Price is clearly a key determinant, or at least the impression of low price is. Supermarkets often give the impression of low price
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while in fact people end up spending more than they originally intended. However, price is not the only determinant. It is quite clear from consumer surveys and from the views of consumer-based organisations such as the National Federation of Women's Institutes, which is supporting the need for further intervention in the field, that consumers are interested in other values as well as price, including concerns such as local sourcing, food miles, environmental impact and support for British producers. We have just come out of fair trade fortnight, which identified a great deal of interest across the nation in producers and conditions not only in this country, but in other countries.
I want the Minister to look carefully at the OFT report. The OFT is suggesting that it will undertake further research. Although that is welcome, there is a great deal of frustration: following the original report from the Competition Commission in 2000, the suggestion that we will undertake further research is not good enough. He might consider establishing a post with what could be called a particular function, as a Minister and ministerial discretion can direct action that is more important than research, rather than requiring primary or secondary legislation. Whether we called the holder of such a post a food trade inspector, a watchdog, and ombudsman or whatever, it would be useful to have a clear sense of purpose within the OFT to achieve a number of critical improvements to the way in which the food supply chain operates.
First, the outcome of the OFT report shows the importance of the need for anonymity to overcome the problem of fear. The OFT needs to be proactive, not to react to complaints. It should proactively undertake investigations, possibly on the basis of confidential tip-offs, although often simply by looking at areas of the supply chain where it perceives difficulties. Subjective language such as "reasonableness" should be replaced with more objective language clearly outlining the length at which payments will be received. There needs to be greater transparency in the food chain. Emphasis needs to be placed on the fact that procedures are in conformity with the code, and perhaps the annual accounts of the larger retailers could contain a statement to that effect.
Where a complaint is made, the appointment of a mediator should not be the responsibility of the supermarket; it could perhaps be the responsibility of the OFT, the complainant and the supermarket acting jointly. The bad publicity that would result from the publication of a report's findings would make a big difference to the way in which supermarkets operate. I am suggesting not that the OFT should ensure that reparations and compensation are paid where a problem is found, but simply that it should monitor the payment of reparations and compensation where the report identifies a need.
Therefore, I am not convinced that there is a need for further legislation of any kind, but we must have clear ministerial direction and clear ministerial bottle if we are to take the issue on.
11.16 am
The Parliamentary Under-Secretary of State for Trade and Industry: I congratulate the hon. Member for St. Ives (Andrew George) on securing a debate on a subject that is important not only to suppliers, but to supermarkets and consumers. He outlined the case excellently, and I shall try to respond to many of the points that he made. I am also grateful to the hon. Members for Meirionnydd Nant Conwy (Mr. Llwyd) and for Brecon and Radnorshire (Mr. Williams) for their comments. The issues clearly affect all those hon. Members' constituencies, and I acknowledge their work in bringing them to the Government's attention. I say that not least of the hon. Member for St. Ives, with whom I have enjoyed time on the football pitch, as he rightly said. On occasion, we have worked well together and we can perhaps do so now to resolve this issue.
It is important that I explain the background to the current supermarket code of practice before attempting to consider the way forward. In 1999–2000, the supermarket sector was the subject of an extensive investigation by the Competition Commission. The investigation was undertaken in response to a reference made by the OFT under the Fair Trading Act 1973 to consider the existence, or possible existence, of a monopoly over the supply in Great Britain of certain groceries by certain supermarkets. That reference reflected complaints that supermarkets had been placing unreasonable demands on their suppliers. The investigation therefore focused on the supply of groceries, particularly to the UK's four largest supermarkets, which at the time were Tesco, Sainsbury, Safeway and Asda.
It is important to note that the report, which was published in October 2000, concluded that the industry was broadly competitive and that, overall, excessive prices were not being charged and those supermarkets were not earning excessive profits. However, it identified three situations in which competition was distorted and which operated against the public interest. The first concerned the relationships between the largest supermarkets and their suppliers. The commission identified several practices that, when engaged in by the larger supermarkets—those with significant buying power—adversely affected the competitiveness of some of their suppliers. As a result, those suppliers were likely to invest less in new product development, which, in turn, could lead to lower-quality products and less consumer choice.
The commission therefore recommended that a code of practice be drawn up to cover the practices that it had identified and that the code be binding on supermarkets with at least an 8 per cent. share of the market. The four supermarkets that were the subject of the commission's adverse findings were required to give legally binding undertakings under section 88(2) of the Fair Trading Act 1973. The supermarket code of practice, which forms a part of those undertakings, was designed specifically to address the unsatisfactory aspects identified by the commission in the dealings between supermarkets and their suppliers of groceries. In short, it provides for those dealings to take place on a clearer and more predictable basis, and the OFT is empowered to review how the code is working in practice.
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The October 2000 Competition Commission report identified two other practices whereby competition was distorted and operated against the public interest—selling some frequently purchased products below cost and varying prices in different areas in the light of local competition. The commission concluded that such practices, when carried out by the large supermarkets, contributed to a situation in which the majority of products were not fully exposed to competitive pressure. It considered several remedies, including a ban on below-cost selling, but concluded that such remedies would be disproportionate to the adverse effects found. It therefore decided not to make recommendations in respect of those two practices.
It is important to note that, in looking at below-cost selling, the commission was not concerned about whether the selling price was below the cost of production. Rather, it was concerned about whether products sold by supermarkets were below the price at which the supermarket had purchased them. Even if the commission had decided to recommend a ban on below-cost selling, it would not have prevented supermarkets from paying suppliers less than the cost of production. I hope that I have given hon. Members a better understanding of the background to the code of practice.
I now turn to the legal details. As I explained, the supermarkets' code of practice was drawn up in accordance with a recommendation in the Competition Commission's October 2000 report on supermarkets. It came into force, as the hon. Member for St. Ives said, on 17 March 2002. It was designed to regulate a limited number of practices engaged in by the larger supermarkets that the commission felt distorted competition and operated against the public interest.
The code is legally binding on the supermarkets that were the subject of the commission's adverse finding—those with a market share of 8 per cent. or more at that time. Because Morrisons was not the subject of the Commission's adverse finding, it cannot be bound by the code even after it completes its acquisition of Safeway. However, we understand that Morrisons has indicated to the OFT that it would be prepared to abide by the code on a voluntary basis.
I think that the hon. Gentleman will agree that the code was never intended as a panacea to remedy all the ills that have been found and deal with all the issues that he raised. It is a formal remedy to an adverse finding by the Competition Commission. As such, its scope and application cannot be extended to cover issues or parties that were not the subject of the commission's adverse finding. It does not regulate the base price paid to suppliers for their products, which is a matter for commercial negotiation. Neither could it do so, as that was not an issue on which the commission made an adverse finding.
The OFT is required to review the operation of the code on an annual basis. It published its first review of the operation of the code on 20 February this year. The review found a widespread belief among suppliers that the code was not working properly, as the hon. Gentleman has outlined. However, it found no hard evidence to support allegations that the code had been breached. I recognise his point that it is difficult for suppliers to come forward if they feel that they are going to be in breach of the code. That is where it becomes

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difficult to obtain the hard evidence that we need to act. Although he must have a heavy case load, if he would like to talk in confidence, I am prepared to meet him following today's debate and consider in detail how we can best pass that concern on to the OFT. I recognise that there is a difficulty.
Andrew George:I thank the Minister for his offer to meet and I am keen to take it up. Does he accept that, given the nature of the OFT report's findings, which identified a sense of fear among suppliers to the supermarkets, the code cannot carry on as it presently stands? A degree of anonymity is required by anyone attempting to interface with it.
Mr. Sutcliffe:I recognise the point. I will try to come on to what the OFT is doing and what we need to consider. Outside the official response to its work, I take the issue seriously and will be working on it and looking closely at what the OFT says. That is why I wanted to speak to the hon. Gentleman and other hon. Members who have hard evidence, because we need such evidence to obtain a result.
As part of its review, the OFT sought information from more than 60 trade associations representing the suppliers, as well as other interested suppliers and the supermarkets. I understand that 35 organisations replied, including a few individual grocery suppliers for the regions that we both know well. Although responses came from a small number of organisations, the OFT is confident that the views expressed are broadly representative of grocery suppliers overall. We think that trade associations with which the grocery suppliers have been involved have put the case across.
As the hon. Gentleman said, much of the information that was received was anecdotal and came without hard facts. We want to obtain those facts. The OFT has found it difficult to come to any firm conclusions about how individual supermarkets are operating under the code, and particularly about whether there has been any breach.
It is fair to say, however, that the OFT's consultation exercise has revealed several points. There is a widespread belief among suppliers that the code is not working effectively, and the main reason identified for the perceived lack of effectiveness appears to be a fear of complaining among suppliers, as we have recognised. The OFT has referred to a climate of apprehension among suppliers. That seems to relate to suppliers' fear that they would be de-listed by supermarkets, which the hon. Gentleman mentioned. I ask the suppliers, trade associations and others to work with the OFT to ensure that we have hard facts on which to operate. The OFT noted that no cases had gone to mediation under the code and that the only written complaint concerning an alleged breach related to events that took place before the code came into force.
When supermarkets originally made their undertakings, the OFT encouraged traders to build up dossiers of alleged breaches of the code. We must ensure that we devise a process that will enable complaints to be made. The OFT takes the matter seriously and is examining it in greater detail. It intends to carry out a
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further audit of the situation, because it recognises that the code of practice is not working effectively. That will be its starting point.
I accept what was said about the speed at which we need to operate because, as the Minister for Employment Relations, Competition and Consumers, I am concerned about the treatment of consumers in relation to some of the issues that have been raised.
The hon. Gentleman raised the question of why there is not an ombudsman, a regulator or someone at the OFT with specific responsibility for this area. I know that a number of people have called for such a post. However, I am not clear what an ombudsman or individual regulator would do that the OFT is not already doing. The OFT has said that it recognises that there is a problem, and the basis for an annual review is in place, although we need to find a better procedure through which individuals can complain and retain their anonymity. The hon. Gentleman is right that there is no need for further legislation or more bureaucrats to look into the matter. As has already been said, the OFT has the power to investigate complaints against supermarkets.
Andrew George:When the Minister and I meet, perhaps we could explore the matter further. It is clear to me that there are a number of areas in which it would be helpful for the OFT to provide a clear focus for action. It should be proactive in producing and publishing reports, and it should address the issue of anonymity. Such an approach by the OFT would ultimately be in the interests of supermarkets, because it would be good for them to be able to demonstrate greater transparency and to reassure consumers that they are not damaging British producers.
Mr. Sutcliffe:There is no disagreement between us on the need for the OFT to act or on the need for its action to be based on factual rather than anecdotal evidence. The view that the code is not working effectively should be challenged on the basis of facts. That would make the whole situation transparent, and people would feel that their grievances had been properly examined. I want the OFT to continue to examine the position in the terms raised by the hon. Gentleman, and I also want consumer protection issues to be taken into account.
The hon. Gentleman said that supermarkets play an important role in the UK, and I do not think that the measures that he is asking us to adopt are anti-supermarket. The code was the result of an initial reference by the OFT to the Competition Commission. We need to ensure that the OFT gets things right. If it produces hard evidence, we will act upon it, because it will be in the public interest to do so.
The hon. Gentleman has raised an important issue. I undertake to meet him to discuss how to ensure that factual evidence from suppliers or their trade associations is put before us. I shall continue to work with the OFT to ensure that there is a speedy response to any concerns that are raised, and shall try to get everyone's agreement on how to establish an effective code of practice. I am pleased that Morrisons is prepared to operate the code voluntarily, but we need to re-examine that issue.

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The hon. Gentleman raised these matters in a spirit of co-operation, and in that spirit, I am sure that we can reach a solution that will allow suppliers and consumers to be protected, while clarifying the supermarkets' position. I congratulate him on raising the issue.
11.29 am
Sitting suspended until Two o'clock.

Water Framework Directive
2 pm
Mr. David Kidney: I like to think ahead and plan what I am going to say in my speeches, and today I thought that I would start by saying that the title of today's debate is dull and uninformative. I look around at the empty seats and I see that that is all too true. How prescient I was. The words "water framework directive" conceal legislation, admittedly secondary legislation, that is both highly complex and hugely significant for the environment. It is therefore important that the subject reaches a wider audience, and this debate is my contribution to getting the message across to the wider world.
In a sense, I do not need to apologise for the subject being dull, because that is a problem for the Minister for the Environment, who will want to take people along with him. Eventually the legislation will have enormous effects. It will touch the livelihoods of many and the lives of everyone in this country. When people wake up to find the great influence that the legislation has on them they will want to know why they were not involved. It is a few years before it takes full effect, but I want the Minister to be able to tell those people that they had every opportunity to contribute to the debate and to make their voices heard in the decision making, and that it is their fault, not the Government's, that they did not.
I know that the Minister has worked hard with the devolved Administrations because some of the responsibility for implementing the directive lies with devolved authorities. River networks tend not to respect borders. One set of regulations deals with Northumberland jointly with the Scottish Parliament, precisely because the network crosses from one jurisdiction to another. It is particularly important to liaise with the devolved Administrations because there are joint responsibilities on the ground.
Water is in the title of the directive, but the framework will have much wider impacts than just on water. I want to start by dealing with the issue of water alone. Heaven knows, it is vital enough. I was struck by the newspaper reports of the Pentagon's assessment of the threats faced by the United States. While threats of terrorism remain and in the US they still talk of rogue states that they must regard as enemies, it was striking how one of the Pentagon's top worries is future conflicts over scarce water resources around the world. If wars are to be fought over water, clearly it is time to think ahead and carry out the work that will prevent such conflicts.
I hope that countries such as ours in the developed world can help developing countries to manage their future water supplies. This is why the framework is so important. When we start to help others, when we start to advise them and to lecture them about how to manage their water sustainably, it behoves us to get our own house in order first. This is where the directive is so significant. We want to be able to tell the rest of the world that here in Europe we have done everything possible to manage our water suppliers responsibly, sustainably and in line with good environmental practice, and to urge them to do the same. I want us to be able to lead by example and speak with authority when we do that work overseas.

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The water framework directive requires all European member states to draw up plans to protect and enhance the quality of rivers, lakes, estuaries, coastal waters and groundwaters, and by 2015 to have in place river basin management plans that will be reviewed every six years thereafter. It is an enormously complex task. It is very challenging, even with a timetable that seems so lengthy. There is plenty to be done. The Government have already been criticised for not doing enough fast enough, and I shall come to that.
I want, however, to start in my usual reasonable, good-natured way by giving the Minister credit for the things that the United Kingdom has done well. Drinking water quality in England and Wales is something of which we can be genuinely proud. In 2002, there was 99.87 per cent. compliance with quality standards. It is pretty difficult to get better than that, although that statistic hides the fact that there has been a considerable improvement during the past seven years. Since 1997, leakages from the water pipe network have been reduced by 20 per cent.
Our beaches, rivers and drinking water are the cleanest that they have been for a century—a pretty creditable record. Last year, a record 332 UK beaches won seaside awards from clean-up campaigners. The same year, 105 UK beaches were awarded the prestigious blue flag, compared with just 17 in 1992. Some 94 per cent. of UK river networks are of good or fair biological and chemical quality—an all-time high. However, that statistic hides another from English Nature, which says that less than one third of rivers in sites of special scientific interest are of a satisfactory standard.
While I am in the mood for giving the Minister credit for the good things, let me also mention the Water Act 2003, which is to be warmly welcomed. We now have in place a system for the comprehensive management of future water abstractions. Abstractors have a duty to use water efficiently, public bodies must make water conservation an aim of their operations and the Consumer Council for Water has a sustainability duty. Those are all good achievements on the part of the Government.
I congratulate the Government on one more thing—their principal guidance to the water regular Ofwat. There was speculation in the newspapers a couple of weeks ago that No. 10 had spiked DEFRA's guns and was going to insist on lowering environmental standards in the next round of water charging to keep consumers' bills at reasonable levels. In the end, however, last week's guidance made it clear that the Government have taken a sensible approach that balances further environmental improvements against reasonable price controls between 2005 and 2010.
The current price review, or asset management plan 4, highlights an issue that often arises when I talk to people about the water framework directive—the relationship between the directive's requirements and everything else that we do as regards our water environment. How does the framework legislation relate to the periodic review of water price limits, the "polluter pays" principle, land use planning, flood management, economic and social regeneration, biodiversity issues, fisheries and marine conservation, health and amenities? Those are enormously important issues, but we do not always see
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the links between the framework directive, our secondary legislation under it and the Government's wider legislation and aims.
Some say that the Government's approach is unambitious and that they are technically and narrowly implementing the directive at the last minute. The subject is so important and so exciting, and it has so great an influence on so many areas of life, that the Government would be missing a trick if they did not do something far more ambitious. It is as though they were a painter who had been presented with a great canvas, a superb subject and a vast array of colours, but who chose to do a little drawing in one colour at the corner of the canvas. It is important that we inject into people the feeling that this is an opportunity that no one should miss. I say to the Minister: let us be bold, let us have a vivid, unforgettable masterpiece as a result of his work at the canvas.
When it comes to the progress that we have made, the original directive gave us until the end of last year to transpose its provisions into domestic legislation. I am not sure whether the Minister will say that he just made it or that he just missed it, because the regulations were laid before the House in December 2003 and came into force at the beginning of 2004, but in fairness to him, several member states have not yet managed to achieve that, so we are ahead of some members of the European Union.
The Environment, Food and Rural Affairs Committee considered the framework, and wrote an excellent report. The Committee criticised the Government, saying that they did not seem seized of the urgency of the task; and it called on them to adopt a more positive and more active approach. Among those wanting to urge their views upon me for today's debate was Water UK, which still has a list of concerns on matters that it says are not clear enough.
Mr. David Drew: I apologise for missing the first couple minutes of my hon. Friend's speech. I am a member of the Environment, Food and Rural Affairs Committee, so I bear some responsibility for that report. We said that the Government had an awful lot to do, but that we would need to see how resources were to be locked in or it would be a bit of a wish list. We were apprised of how serious an issue it was, which is why we linked it in with the Water Act. We wanted cause and effect to be locked into one. Would my hon. Friend like to comment on that?
Mr. Kidney:Frankly, that clarification is all of a piece with people saying, "Let's be ambitious in how we implement this. Let's make sure that we have firm links to other issues that we think important, such as biodiversity, the management of wetlands and flood prevention. Let us build those things in and plan it from the beginning, so that we get there in the end rather than leave things to the last minute in a rush to be compliant with the directive timetable." That will lead to greater cost rather than less. Being able to plan ahead should enable us to gain the maximum benefits, but without the costs that might come with slow, tardy implementation.
I mentioned Water UK, which was represented in the Minister's third round of consultation. On a different tack, the non-governmental organisations are broadly

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supportive of all that the Government are trying to achieve, but they still speak of gaps and delays. As I said a moment ago, we have already had three rounds of consultation, but the Government are planning a communications strategy this year, and the Environment Agency will be responsible for the preparation of a public participation strategy. The Minister may say that some of that consultation is already in hand as part of this year's programme.
I turn to the question of linkages and interrelationships. Diffuse pollution gives a good illustration of the scale and difficulty of trying to make decisions that please everyone. Many respondents to previous consultations said that such pollution was a matter of concern and demanded to know the Government's answer. In a debate pack prepared by the House of Commons Library—they are marvellous documents—I saw that a Plymouth newspaper had quoted a DEFRA spokesperson as saying last December that the Department intended to consult on diffuse pollution and its effect on agriculture by the end of March 2004. I have not seen that consultation yet, and it is already the middle of the month. Where is it?
Farmers are sensitive about the subject, although I hasten to stress that there are many sources of diffuse pollution. Indeed, some sources are urban. The National Farmers Union branch in Stafford urged that point on me this morning. It is ironic that 42 members of that branch had arranged many months ago to visit Parliament today; they urged me to pass the message on to the Minister that an awful lot of diffuse pollution does not come from farms.
At one end of the range of options for dealing with the subject is fresh regulation. However, the burden of complying would be borne by the so-called polluters, including farmers; it has been estimated that it could cost as much as £400 million. That might stamp out the problem, but the cost would be so high as to drive many farmers and others out of business. I hope that the Minister would find that outcome unacceptable. At the other end of the scale is the light-touch approach, seeking voluntary co-operation with those responsible for the pollution, but ending up with no or little improvement. I hope that the Minister would rule out that outcome.
What choice does the Minister have between those two extremes? What resources does he have at his disposal to help make his approach work? We have just been through a round of common agricultural policy reform and declared how we will apply single payments and insist on cross-compliance in this country. Are resources available through that policy that could be used to address diffuse pollution? That would be a good example of the inter-relationship between two different subjects. If that funding is all accounted for, where will we find the money for incentives for farmers to cooperate? We also need to consider the "polluter pays" penalties for those who do not co-operate. Would there be pressure for further CAP reform in the European Union's common implementation policy for the directive, which would come in time to provide public funding for the incentives that I mentioned for people such as farmers?
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Tackling pollution brings not only environmental and social benefits, but economic ones. The water companies spend £120 million a year removing pesticides from water courses. By acting firmly, decisively and in good time, we can save money for the future.
We can achieve those objectives if we want to. The Government have the right words. To those who have not seen it, I commend the document "Directing the Flow", published in November 2002. Pages 28 and 29 discuss the directive, and it is a superb statement of the Government's approach. The Government's response to the Select Committee report was also thorough. Those are good signs, but some explicit links are missing that we might have expected to see. The Water Act has been passed and the Planning and Compulsory Purchase Bill is about to become law, but we did not do what was necessary about flood management and land use planning when we had the opportunity. Worries are still being expressed by people about the future tackling of diffuse pollution and the treatment of wetlands. I noticed that the second newsletter from the European Union directors of the water framework directive states that they have issued new guidance on wetlands. What does the Minister think of that guidance? However, there are challenging targets. There were challenging targets last year to get the law in place, and there are challenging targets this year—for example, for the Environment Agency to consult on its draft strategy for drawing up river basin management plans, and how to include public participation.
I am excited by this subject, and there are prospects that should excite us. There is potential to enhance all three legs of sustainable development. Environmentally, we can have cleaner, more adequate water supplies, improved biodiversity and better protection for sites of special scientific interest, wetlands and local wildlife sites. Economically, we can have lower clean-up costs in future, improved tourism and leisure opportunities and regeneration opportunities along the way. Socially, we can challenge the problem of flood management and stop it at source in river areas before it reaches urban developments downstream. We can have greater access to the countryside and healthier living standards as people use the opportunity to take exercise as well as eat healthily. Rural businesses such as farming can carry out their work in a more socially responsible way.
There are good prospects under this directive and the relevant legislation for us all to achieve some good objectives. They must be achieved with the active involvement of all the relevant stakeholders, not favouring businesses over environmental groups, nor vice versa. They will be led by the Environment Agency as the Government's champion on the subject, although people have questioned whether the Environment Agency has sufficient skills and resources to do its work properly, and those are points for the Minister to bear in mind.
I hope that the Minister agrees that education will be key. DEFRA is working on a communications strategy as one element that will ensure success in the future. Other elements involve Parliament. I admit that today is a bad example, as not many hon. Members have turned up for the debate, but there is interest in the issue, and we should ensure that people understand how important it is. I should like regular reports to be made

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to Parliament and debates to be held. If we cannot get Members into the Chamber, will the Minister consider seminars to get them together to discuss vital matters before final decisions are taken and to listen to different points of view?
Will DEFRA have a champion of its own? I am sure that the Minister is a fine champion of his Department on many subjects, and does not have as much time to devote to this matter as the stakeholders—the public and Members of Parliament—might want. Will he consider whether someone could be the focus of contact with the public and the production of the news as it comes in, and involve people in future debates and discussions? We should keep working with stakeholders, and should not believe that three consultations were good enough simply because the legislation was passed. There must be many more consultations like those. I have not checked the full list of who has been consulted. Does it include local government planners and the regional development agencies, which are so important to the regeneration of the areas that are affected? I know that a pilot is being run in the Ribble basin. Perhaps regular news, updates on progress and any findings that are emerging would he helpful to Members of Parliament and to others with an interest in this subject. Surely that pilot would make a good case study?
Mr. Drew:Does my hon. Friend agree that one of the more interesting aspects of the water framework directive is not only its impact in this country and in Europe, but the ideas that it may produce for the wider world? I am very interested in recent discussions on the Nile basin. Several of our water companies have visited the region to advise countries that lie alongside the Nile. Surely the directive should stimulate such activities, because the whole world has to be careful about the use of water, not just the western world?
Mr. Kidney:My hon. Friend confessed that he had missed the beginning of my great speech today. He sat down behind me, so I do not know precisely when he came into the Room, and he may have missed the significant point that I made at the beginning of my speech about how important it is to be able to speak with authority and lead the world by example when we ask others to do in their countries what we have shown that we can do at home. My hon. Friend makes a very good point, because it agrees with the point that I made earlier.
At the beginning, I said that the title of the debate masked something of great significance. I am sure that many will find the regulations and the regulatory impact assessment dry and lifeless, but so much good can come from a positive approach that the Minister has the power to see to it that the words jump off the page and splash some colour into all our lives. I was trying to think of suitable alliterations to liven up this part of my speech. Let us see more babbling brooks, sweet springs and rippling rivers. These are things that the Minister has it in his power to achieve. Few issues are more important to our communities, our country and our world than water management. I hope that the debate, sluggish though it was at the beginning, will start a sustained and serious campaign of support for what our country and all the countries of the EU seek to achieve.
2.24 pm
Mr. Robert Key: Because I shall speak with passion, nothing that I say will be reported anywhere, so I can be candid.
I congratulate the hon. Member for Stafford (Mr. Kidney) on introducing this very important debate. I also congratulate the Minister, even before I say a word about what he has achieved, precisely because he has achieved so much. He has fought and won a notable battle with the forces of No. 10 and Ofwat in ameliorating the decisions that have been taken about the future care of this country's water resources. The water framework directive preamble says:
"Water is not a commercial product like any other but, rather, a heritage which must be protected, defended and treated as such".
I do not always go overboard in my support for European directives, but on the present occasion I want literally to go overboard and splash in the shallows of the Hampshire Avon. Every weekend, in Salisbury, I look over the parapet of the Ayleswade bridge, which was built in 1247, and consider the depth and quality of the water; I observe the bottom and whether the river appears healthy. I reflect on what we are doing to that river.
I have known the river since I was a child. I paddled in it when I was two years old. I fell into it when I was four years old, and was rescued by the Bishop of Bombay. I have rowed on it and watched birds and flowers there. I am a keen supporter of the water meadows trust. As the Member of Parliament for what is a wonderful constituency, that river means a lot to me.
It is a short step from the general words of my preamble to the principle that the price of water must reflect the full cost of protecting water heritage. That is the issue that I want to discuss. The cost must reflect the full cost of finding alternatives to damaging abstractions and pollution. The long campaigning—20 years, in my case—to protect the quality of the Hampshire Avon from abstraction and effluents is a vivid illustration of what the water framework directive is about.
The first paragraph of article 1 of the directive states that the purpose of the directive is to establish a framework that
"prevents further deterioration and protects and enhances the status of aquatic ecosystems".
Thus the directive is about protecting water qualitatively and quantitatively, and therefore its objectives overlap with the ecological objectives of the habitats directive. That is what is at stake in the argument that has been raging for years in my constituency about abstraction by Wessex Water—a fine company with lots of dedicated personnel who are in constant conflict with Ofwat about their investment plans. In the middle is the Minister.
The price review process gives far too much influence to Ofwat. Back in 1999, Ofwat succeeded in reducing prices substantially by eliminating many environmental programmes in the Wessex Water area, such as the Blashford lakes programme. That was an irony, since I recall an occasion when I had to stand in unexpectedly for the then Secretary of State for the Environment, who had just been sacked, the day before he was due to open the new Blashford lakes complex. I was sent there instead, as a Parliamentary Private Secretary. I still have

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a very nice print of the Hampshire Avon hanging in my bathroom, with a hastily rewritten notice underneath, with the name "Key" instead of "Ridley".
This year Ofwat wanted to cut another £5 billion from the programme and it was only a courageous fight by the Minister that prevented that. The River Wylye in my constituency has been a particular victim of what I am describing. The structure of the price review programme should be reviewed in the light of the water framework directive and the habitats directive, to ensure that it gives sufficient weight to environmental protection.
Locally, Wessex Water's draft plan for 2005 to 2010 included virtually no investment in reducing abstraction or removing phosphates from sewage treatment works. There was an allocation of £8 million, compared with a £90 million minimum request from the Environment Agency and English Nature. I understand that after a lot of pressure, Wessex Water has verbally agreed to put £10 or £12 million in its final plan, to cover investigating an alternative to the 1 billion litres a month taken from the little chalk stream of the upper Wylye and exported to Somerset. It is madness. We have massive leakage in the area, yet we are abstracting the headwaters of one of our most precious river systems to fulfil the needs of quite another part of England. The earliest that even the present scheme could have any effect on the river flows would be about 2014 or 2015. That assumes agreement by Ofwat to let Wessex Water finance it in the 2005 price review period.
There is no funding for a solution such as an agreed building programme in a Wessex Water plan, because Ofwat forced the so-called statement of intent on the Environment Agency and English Nature. The statement of intent must be reviewed every year. January is usually the month, so I expect the review to be published shortly. The plan said that Chitterne abstraction would be used as a last resort. As so many of us predicted, however, there was a failure to protect the Wylye. The abstraction at Chitterne for five months was five times the target level. The flow in the River Wylye dropped to 40 per cent. of the average. The agreement nevertheless has to run until 2007, and allows Ofwat to delay the programme and the price increases to find a solution to the low flow problem for another five years.
In spite of all that, Wessex Water last year—last summer was quite warm and dry, as I am sure hon. Members recall—failed to apply for a drought order or introduce any restrictions on supply. Of course, the issue of prices lies behind all that. In retrospect, the policy of 2000 to reduce prices by 12 per cent. was idiotic. Wessex Water bills went down by 5 per cent. in real terms in the period 2000 to 2005. Even from that artificially low base, however, prices in Wessex Water's plan increased by only 12 per cent. for 2005 to 2010, compared with 31 per cent. nationally.
The key issues on which we are fighting locally are to ensure that the £12 million really is there to investigate alternatives to the Wylye abstraction and to ensure that the investigations result in a project agreed by all the parties to eliminate abstraction from the Wylye. Eliminating the abstraction must be the answer. We must also ensure that the full Environment Agency and
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English Nature programme for phosphate removal is in the Wessex Water final plan, but we have not yet been promised that it will be.
The argument has been going on since 1990, when the Wiltshire fisheries association starting fighting its corner, although I started fighting back in 1983. We shall not get an answer until 2014 at the earliest. It is not acceptable that we have had to wait for a quarter of a century to remedy serious environmental damage to a special area of conservation site, which is supposedly the most important designation.
There is a huge problem of attitude. Water Voice Wessex wrote to me on 22 July 2002 about what it saw as a settlement for low flow rivers such as the Hampshire Avon. It said:
"Water Voice Wessex fought hard for customers against the original £105m proposal"—
that was Blashford lakes—
"which we did not believe was cost effective, and would have increased bills significantly by £11 per year ad infinitum. This new proposal will quickly improve the low flows on the Hampshire Avon and not significantly increase customers' bills. This is a win-win for all concerned."
It is a lose-lose for all concerned. The environment will lose and there will not even be any long-term benefit for consumers, because the other problems will become greater if, for instance, phosphorous and other chemicals are not tackled.
The public consultation draft, "River Avon candidate Special Area of Conservation Strategy", published by English Nature in October 2002, said:
"The River Avon is one of the most biodiverse chalk streams in the UK, with over 180 species of aquatic plant … one of the most diverse fish faunas, and a wide range of aquatic invertebrates"
having been recorded. There were populations of Atlantic salmon, bullhead, brook and sea lamprey, as well as flowing water vegetation, including water crowfoot. The river and adjoining areas also provided a habitat for populations of Desmoulins whorl snail, with which I am sure we all familiar.
The key issue was that the discharge of substances, including hormone-disrupting substances, mostly as a result of the pill, discharged from sewage treatment works was affecting much of the sensitive environment. Discharges of phosphorous chemicals—detergents, in other words—from point sources were being reduced, but there was a long way to go. This country must decide what it wants to do. Are we going to go down the route of cheap water for everybody, with no regard for leakage or the consequences for the environment? The leakage levels are still enormous. Paragraph 6.7 of Wessex Water's first annual report to the Minister on progress, published in January 2003, says:
"During 2002 Wessex Water continued to reduce leakage. By March 2003 leakage should be reduced to 75 million litres a day."
That has been assessed as the economic level for leakage.
"For 2003–04 leakage is predicted to reduce to just over 74 million litres a day and remain at the economic level."
Who says that that is an economic level? What sort of economics of the madhouse is it that assumes that it is all right to lose 75 million litres a day, at the same time as 1 billion litres are being taken out of the headwaters of a sensitive chalk stream on Salisbury plain? It does not add up.

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The Minister will be familiar with me banging on about this, but I am convinced that the answer must be water metering. There is no way that people will realise how much water they are wasting unless they can see a little dial going round that tells them, before a bill flops on the doormat to remind them every now and then. There are plenty of ways in which we can reduce water consumption—but we are not. Planning authorities are nearly always reluctant to go for grey water schemes and to operate sustainable urban drainage systems in their areas. Planners are put under huge pressure to build more and more housing, as is Salisbury district council. Water companies are not statutory consultees. The whole thing is completely mad.
All power to the Minister if he can persuade No. 10 to take a more enlightened view. Will he please get Ofwat and Water Voice under control, and talk to them about the consequences of their fighting for the consumer? In the long run, apart from the fact that we shall all be dead, we shall not have any decent rivers in this country. I hope that in my few minutes, I have been able to instil some passion into the debate, which was so ably introduced by the hon. Member for Stafford. I am grateful to him, and wish that we could convince our constituents of the importance of the work going on in this area. It is not just about people flopping around looking for things with long Latin names, but about one of the most precious parts of the heritage of this country. If we do not take care of it, we shall lose it.
2.37 pm
Sue Doughty: I, too, congratulate the hon. Member for Stafford (Mr. Kidney) on securing the debate and introducing it in the way that he did. He painted a picture—a glowing canvas—and rightly identified lots of areas that are beginning to shine out here and there as little corners of hope. We must integrate the whole picture: when we talk about waste management, we usually grumble about having a jigsaw with no picture and only some of the pieces. Here, too, there is a vision for the future, and we must find out how to fill it in and move forward.
The subject of this debate should not be as dull as ditchwater. The directive should not be portrayed in that way, because it is one of the most exciting environmental measures that we in Parliament shall see. It sets the scene not only for this country but across Europe, and goes a long way to recognising the stress that our environment is under. It will start to put right some problems and set the scene for the future, where the climate is changing and rainfall is different, and—as the hon. Member for Salisbury (Mr. Key) said—our growing population is making huge demands on water usage within a very small island. It is a matter of urgency, although I accept that we cannot implement it instantly. There must be a lot of careful planning to ensure the outcomes that will deliver the directive's huge benefits.
It was most interesting yesterday to see Folkestone and Dover Water Services Ltd. proposing metered water supply, recognising that we cannot continue to take water without understanding the impact of that. We are looking at the benefits of the water framework directive, which will require rivers, streams, lakes, estuaries and coastal waters to achieve good ecological status by 2015. It is interesting that that is the date when
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that water company expects 90 per cent. of users to be on metered water. I would expect other water companies to start to take that approach.
I share the views of the hon. Gentleman that we must do much more to manage leakage and water usage, and to recognise their huge threat to the environment. As we always say, our countryside needs to be there not only for our use, but for our children and their children. The work we do now will preserve the heritage for them, start to reverse some of the damage that we and our forebears have done, and start to bring in improvements. That will not be simple, because there is huge pressure on the countryside. We talk about the uses that we make of the countryside—whether we are concerned not to build on it, or whether we want it for leisure access, such as water sports. Those uses have an impact on the countryside, and we must ensure that people get the benefit of the countryside, while understanding that we need to preserve it and that we cannot take a chance on biodiversity.
I had the pleasure of going out with English Nature to look at a site in my constituency—it was almost literally in my backyard, because my home is in the River Wey basin. It was an eye-opener for me to see the diversity of the species on that site, which is being managed to preserve different areas and species such as kingfishers and other birdlife, and deer. It was interesting to see all the different aspects by which we measure the quality of the environment.
There is much work to do. We need to put programmes and measures in place by 2012, and the mechanism for delivery is the river basin management plans. As we have heard, the Government brought the regulations for the transposition of the directive before a Delegated Legislation Committee very late and, as a result, we had little time to debate that important measure. We have concerns about integration of the programme. There are good intentions, but there must also be the means for delivering the environmental improvements that the directive is intended to bring about. We have concerns about the Government's interpretation of the directive and their approach to its implementation. We want to know that the Environment Agency will have the support that it needs to implement the directive, because implementation will not happen without that support. We fear that the Government may take a timidly minimal approach to the directive, both in relation to the environmental improvements and to the public participation that is needed. There must be more flesh on the bones.
The bulk of the duties of regulation are to be carried out by the Environment Agency, and the Minister stated in a Standing Committee that the agency is satisfied with the outcome of its negotiation for the funding settlement. However, he continued:
"Of course it would like more funding. I understand that and I would like to give it more funding, but we have to work within a budget framework and to a ceiling."—[Official Report, First Standing Committee on Delegated Legislation, 27 January 2004; c. 15.]
I do not get the feeling that the Environment Agency is satisfied with the funding. I believe that it will be compromised by insufficient resources in addressing such a demanding agenda.
For once, I will not say to the Minister that I want more and more money to be spent; I recognise the achievements behind the announcements that were

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made last week about how much money would be made available to the environment. However, we need to start working according to the "polluter pays" principle. We must implement mechanisms to ensure that people who damage the environment pay for its reinstatement.
Mr. Kidney:I have every confidence that the Environment Agency does its job well. The resources that it requires are not just financial; what matters is the skills set and the suite of powers and carrots and sticks that it has to do the job. We need to hear details of those from the Minister.
Sue Doughty:I thank the hon. Gentleman for that intervention. He put his point concisely, and I support it, as we want to know how the Environment Agency will carry out the work.
Having said that, I reinforce my praise for last week's announcement. Liberal Democrats will always support the Government when they take a strong line on the environment. We heard about several schemes, and the plan to reduce the input of the nutrient phosphorus, which can upset the ecological balance of rivers, into the River Axe in Devon by removing phosphate at local sewage treatment works is just one example of the good work that can be done to bring about a benefit.
However, the Environment Agency wanted the Government to go further, and I should like to know about future plans because we must recognise and protect our heritage. We must consider the problems of diffuse pollution—the nitrates and pesticides that wash into the rivers through farmlands. We sit on committees and it is our responsibility to keep in touch with farmers, so that we all know about the huge problems that they face and the demands that we are putting on them to change how they work through reform of the common agricultural policy and changes to the rural environment. However, we have to find a way for farmers to reduce nitrate use while passing the cost to others so that they can stay in business as conservers of the countryside as well as producers of excellent food and rural products.
We have some concerns about public participation. If we are saying to people that, because of the environment, they cannot do this, cannot build here or must look after that, and that they will have to pay the price in their water bill, we must negotiate with them and explain why we are saying that. Such a dialogue is missing, and consultation is not always the same as involvement. Regulation 12 of the Water Environment (Water Framework Directive) (England and Wales) Regulations 2003 deals with consultation, but we need to know how it will take place. How do the Government envisage the process developing when we want to spend money? How will we have that conversation? I do not want to use the phrase "big conversation" because I feel a little scarred following the recent public debate on genetically modified crops and the subsequent announcement.
We need to ensure that the public can do more. We should be able to tell them our environmental objectives and ask them how they would prioritise and fund them. Could we put out information with water bills to tell the
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public what we are trying to do for their environment and how we are spending their money? Some places, particularly in the south-west, have had problems with sewage and coastal water, and we should provide much clearer explanations to the public about why their bills have been at such a level. They are ultimately picking up the cost, so we need to consult more.
The same is true with the NFU, as we are asking the farmers to make changes. I have mentioned the costs, but most farmers want to look after the countryside and do the right thing. Consultation should be a two-way process, so that farmers can explain the implications of what we are asking of them and make their own suggestions about how changes can be delivered. We have a problem with regulation 12, as it does not seem to provide a way for farmers to appeal, perhaps in challenging a river basin management plan. The current requirement is only that the Environment Agency should take representations into account. We need a fairer deal with farmers, so that their voice is properly heard. They need to know, point by point, what the problems are.
There were earlier discussions about accountability to Members of Parliament, and some good suggestions were made. I listened to the hon. Member for Salisbury, who has taken time to look at how the plans affect his constituency. We need to do that so that we understand not only the problem as a whole but how it affects our different regions and river basin management plans. We must listen and talk to our constituents, so that we can bring their views into the debate.
In considering how the directive will be implemented, we have one query about bodies of water. The Environment Agency will be responsible for identifying bodies of water with areas of 50 hectares and over, thus excluding all but 12 per cent. of lakes. We cannot include all the smaller bodies of water, but could we do a representative sample of some of them, as with the pilot in the Ribble valley, so that we get a better understanding of the interrelationship of ponds? I learned yesterday from one of the scientists at the marvellous exhibition in the Terrace marquee that there is a huge interrelationship between small lakes and ponds. There is a large regional diversity in the ecology of ponds, almost more than in large lakes and rivers. Pockets of rare species are found in small areas, which is why small water areas are so important. Networks—whether ponds, streams or marshes—must have proximity if they are related ecologies. It would be interesting to see whether we can investigate that further.
We also need to consider further integrating what we are already doing. We need to integrate the water framework directive with the Government's existing commitments to conserve biodiversity through the UK biodiversity action plan. Wetland biodiversity is under pressure. We need that integration, so that we are not picking off one opportunity at a time. We need to do much more. If the biodiversity action plans were to go into the river basin management plans, it would take us a long way forward and give us a much stronger information base.
I know that other Members will have quite a bit to say on this subject, and I am interested to hear what the Minister has to say. I am especially looking forward to hearing his response to several integration points, and to

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hearing any further announcements that he makes about how the water framework directive will be implemented.
2.52 pm
Miss Anne McIntosh: I, too, congratulate the hon. Member for Stafford (Mr. Kidney) on securing the debate. I regret, on his behalf, that it has not been better attended, although the quality of the contributions more than compensates for that. It has been a stimulating debate, of which the image that I shall take away will be that of my hon. Friend the Member for Salisbury (Mr. Key) making a passionate speech in which he told us about paddling in the Avon waters as a youth. I shall remember that fondly.
I should like to impress upon the Minister that things have moved on a little since we last met, when the Opposition prayed against the implementation of certain regulations. I want to tell him how I started off as an early eco-warrior. Hon. Members may have heard a recent Saturday morning Radio 4 programme about green pioneers in a part of the country that I have kept fairly secret until now—although, as my hon. Friend the Member for Salisbury said, we know that whatever we say in the confines of Westminster Hall will go no further—where I was brought up in the north of England. On one side of the River Tees, there is County Durham and on the other side is North Yorkshire, which is not far from my present stomping ground.
There was a proposal to strip some water from the River Tees and carry it across to industry in Teesside, making what is now Cow Green reservoir. The reason why I was so interested in that, my first environmental issue, was because it would flood an area that had the only known blue gentians outside the alpine countries of Austria and Switzerland. In spite of huge local opposition, the project went ahead to no purpose whatever. By the time that it was finished and Cow Green reservoir was completed, the industry had secured its water supply from another source, and the project had flooded an area of outstanding natural beauty. Of course, it proved impossible to grow blue gentians outside that area in the north of England, so we no longer have fields of blue gentians. That was the start of my eco-warrior campaigning and the setting of our blue-green agenda several years ago. I was delighted that BBC Radio 4 paid tribute to those early green pioneers in that regard.
As the Minister is aware, we support his aim. In his Department's words:
"The Water Framework Directive … is the most substantial piece of EC water legislation to date."
When we prayed against regulations made under the directive, the Minister asked how the Government could be both early and late in the transposition process. As I was not allowed to answer back on that occasion, may I say that, as the hon. Member for Stafford has suggested, one can be both early and late? One might be one of the first European Union countries to transpose the directive, but the Minister almost missed the deadline. The Minister could be said to have been both early and late on that occasion.
The conclusions on pages 22 and 23 of the Government's response—presumably the Department's response—to the excellent report from the
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Environment, Food and Rural Affairs Committee on the water framework directive, contain two points on which I want to press the Minister this afternoon. First, the Department said that it was
"conscious of the need to ensure proportionality"
in the way that the regulations are transposed and applied in this country. Precisely how does that proportionality apply, in the Minister's view, to the massive costs that will be inflicted on the farming community through the process, as a number of us have already claimed? Indeed, the Select Committee also argued that point.
The hon. Member for Stafford, in opening the debate, referred to my second point. There is scope for more joined-up government, particularly in land use and land-use planning. I want to place on record my gratitude—I think that the Minister knows of this—for the discussions that I have had with the Environment Agency office in York. Its headquarters are in Clifton moor, but it covers the whole of the region of Yorkshire and the Humber right up to the Scottish border.
I make an urgent plea to the Minister to use the moneys—the rural development moneys in particular—that will become available through reform of the CAP for imaginative flood defence schemes. If he has difficulty thinking of any, perhaps I could have a quiet word with him after the debate this afternoon, as we have identified one in our area. The Ings at Milby island in Boroughbridge are currently flooded because of the lack of compensation. If we can use those funds in an imaginative way to compensate the farmers for the good that they are doing for the rest of the community by shoring up and repairing flood defences, that would be most welcome.
We established the costs when we prayed against the regulations made under the directive. The costs to farm businesses alone are estimated at between £500 million and £3 billion. I have also seen a figure that suggests that the total costs will be much higher. It is estimated in one report in the press—the Minister can reject this figure this afternoon if it is not accurate—that the total cost of implementation has been priced at £9.2 billion.
I also urge the Minister to look favourably at the official Opposition's two early-day motions, and also all who have contributed this afternoon, including the hon. Member for Stroud (Mr. Drew) who clearly had a pressing engagement, which was perhaps related to the subject matter, and who is not here with us—I shall speak to him later. We have tabled early-day motion 511 on the water framework directive and early-day motion 631 on the groundwater directive, which go over these points. I hope that the Minister will look favourably on them.
How can DEFRA argue and how can the Minister say hand on heart that they are applying the principle of proportionality to the farming community when not only are farmers being asked to pay the costs from the directive, which could be as high as £3 billion, but the regulatory burden of most EU directives falls directly on those farmers? There is the integrated pollution prevention and control directive, the nitrates directive, the groundwater directive that will probably cost £1.2 million to apply, the water framework directive and the fallen stock directive. There is also the proposed pesticides directive—I could go on but time prevents me.

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A number of hon. Members have already referred to the huge costs of the administrative burden falling on the Environment Agency. I did not get a convincing response from the Minister when we raised that point in the Delegated Legislation Committee that considered the transposing regulations, but enormous burdens are being imposed on the Environment Agency. He will confirm whether those burdens are on top of the other work that the agency is being asked to do. Does he expect the agency to juggle the resources? Will water companies be asked to reimburse the agency direct? How does he imagine that that will be paid for?
Water companies will, as we know, pass the charges on to consumers. I know that that will alarm my hon. Friend the Member for Salisbury, who is becoming known as a champion of his constituents in his discussions with Ofwat. It does not seem fair that one category—water companies—can pass on the costs to their customers, who are all of us. That seems particularly unfair on the most vulnerable people, who use water just as the rest of us do. I am thinking particularly of pensioner households and single parent households in which there is only one income earner, bringing up children on their own. How can we ask those people to meet the sizeable increases in their bills? How does the Minister expect farmers to cope when they cannot pass on their costs?
Obviously, the Minister will respond in his own inimitable way to my hon. Friend's question about slicing water off one water source to run it into another watercourse. What are the environmental disbenefits and the costs of that? I should also like to use this opportunity to bring another matter to the Minister's attention. I do not know whether he or the Secretary of State will be asked to rule on this, but the European Commission has apparently been requested, and may agree, to co-fund a highly controversial Spanish hydrological plan, the aim of which is an annual transfer of 1,050 cubic hectolitres of water from Ebro, in Catalunya in the north of the country, to the southern regions. There is deemed to be a mass tourism and intensive agriculture problem, and anyone holidaying in the south of Spain and particularly its islands will be aware of the problems of light rainfall and of getting water to those places. Now that there has been a change of Government in Spain, albeit in highly regrettable circumstances, can the Minister really expect British taxpayers' money to be used to co-fund a hugely expensive hydrological project that will bring no benefits whatever to this country?
I congratulate the hon. Member for Stafford on securing the debate and, in particular, on its timing. I am disappointed that he was unable to join us on and contribute to the Delegated Legislation Committee that considered the transposition and implementation regulations, but there is still time for him and other hon. Members to join us in supporting early-day motions 511 and 631.
Mr. Kidney:The hon. Lady invites us to join her on those early-day motions. Will she join the rest of us who have praised the Minister for the settlement on the guidance in respect of the price review for 2005–10?
Miss McIntosh:I am sure that the hon. Gentleman would not want to stretch my good relationship with the
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Minister, but had his Department lost that argument with No. 10, it would have made a complete mockery of everything that the Department has been trying to do on the European water framework directive and the groundwater directive.
The Minister, and indeed the hon. Gentleman, would probably join me in paying tribute to the previous Conservative Government, who were the first to apply the EU drinking water and bathing water directives. I have a little anecdote about that, which I shall save for the next Adjournment debate on this subject. For now, I hope that the Minister will, wherever possible, build on the partnership approach—I prefer the term "partner" to "stakeholder", on which the Government insist—and look to a voluntary approach, particularly with the farming community, to ensure that the principle of proportionality espoused by his Department applies on this issue as it does everywhere else. I hope that the Government will take this opportunity to say that they will move away from what can appear to be a heavy-handed, regulatory and burdensome approach to the transposition, and that they will apply a lighter touch, rather than imposing highly expensive, costly and ineffective burdens on businesses such as farming and water companies, as the Department has done in the past.
3.5 pm
The Minister for the Environment: I join hon. Members in congratulating my hon. Friend the Member for Stafford (Mr. Kidney) on the way in which he presented his case. I support the main thrust of his argument that these are complex and significant issues and that it is necessary to raise awareness about them. I will respond to some of his thoughts on the subject, which were quite good.
I endorse his point that we should lead by example and speak with authority on water management issues. Hon. Members have shown great interest in the matter, especially the hon. Member for Salisbury (Mr. Key), who has a long-standing interest in water management matters and has spoken about them many times, with a great deal of sense. I do not doubt his enthusiasm and commitment, and I shall say something about the points that he raised in a moment.
The hon. Gentleman mentioned AMP4—the price guidance—and the Minister's recent guidance to the regulator, which was a fair outcome. There are anxieties about costs and we cannot escape that. We have to bear in mind the costs to consumers, but the hon. Gentleman is right: there will be costs if we want improvements. Although consumers want water prices to be kept down, they are very interested in the quality of the water that they receive and in the management of the aquatic environment. Biodiversity in that environment and the improvement of rivers and coasts are popular with the public. It is a matter of getting the balance right.
My hon. Friend asked how the water framework directive fitted into AMP4. In terms of major commitments under that directive, the bulk are likely to fall within the next round of price guidance, AMP5. Nevertheless, there are several aspects of AMP4 that will contribute to the objectives of the water framework directive. They include the freshwater fish directive, for which there is support, and continued improvement in

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the quality of inland and still waters, especially those that apply to SSSIs. There are several upland pilots on water management involving water companies, which I am keen to see up and running. All of those contribute to achieving the objective of good biological quality water courses.
I accept that agriculture is not responsible for all diffuse pollution and I absolutely accept my hon. Friend's point about the farmers in his constituency. However, we cannot ignore the fact that farms are the biggest contributor in that respect, although there are others, such as the run-off from roads and other point-source pollution that we need to tackle. We need a range of measures involving incentives to deal with diffuse pollution, as my hon. Friend said. Our agri-environment programmes are substantial and the objectives of the review now contain some resource protection, which may involve regulation or financial instruments. They will form part of the consultation on our proposals for tackling diffuse pollution, which will be published towards the end of this month or the beginning of April. My hon. Friend will have the opportunity of seeing those proposals and he may wish to contribute to them.
My hon. Friend talked about involving MPs in consultation in its broader sense, and I agree with that. I like the idea of his proposal of a seminar for hon. Members on the water framework directive; I know that there is a lot of interest in the issue in the House, so I will give his proposal serious thought and consult within the Department to see what we can do about it. I am certainly sympathetic to his case.
The hon. Member for Salisbury made a very good speech. He said that he would speak with some passion, and indeed he did. As a matter of fact, the issue deserves some passion. The hon. Gentleman represents an area that has some wonderful chalk streams and some very delicate biodiversity. He has long championed water extraction issues and long campaigned for the kind of measures that we have now introduced in the Water Act. On the issue of management, he strongly argued that environmental aspects must be part of the price review process. That must be recognised, and we are trying to ensure that that happens.
As regards the abstraction problems in his part of the country, it is inevitable that a serious look will have to be taken at the abstraction licences of some of those involved, and some may have to be withdrawn under the new powers in the Water Act. There are facilities to do that, and the hon. Gentleman, who served on the Committee that considered the Bill, will know how they can be applied.
The hon. Gentleman also mentioned Wessex Water's low-flow agreement, and I am in the process of responding to Wessex Water on the issue. Its statement of intent allows for a five-year programme of work and research to assess the effectiveness of measures to restore low flows. As the hon. Gentleman rightly said, Wessex Water is only part way through the programme, and some measures are still to be fully implemented, so it is a bit early to reach conclusions about the programme's overall effectiveness. However, the second annual report to Ministers has shown that overall progress is being made in accordance with the statement of intent. The signatories to the statement—the Environment Agency, English Nature, Wessex Water and Ofwat—are
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monitoring progress. In addition, a consultation group consisting of wider interest groups can follow progress closely and provide input. I know that the hon. Gentleman will support that approach.
Mr. Key:Will the Minister take care to notice whether Wessex Water has any plans to rebuild inadequate infrastructure? Such infrastructure is a major problem in terms of the flooding of sewerage systems in remote rural areas, which often leads to overflowing at sewage treatment works. Will he also consider the issue of phosphorus? As far as I am aware, there is no intention to upgrade sewage treatment works to filter it out.
Mr. Morley:I will certainly be happy to consider those points. I can tell the hon. Gentleman in general terms that the ministerial guidance to the regulator deals with issues such as sewer flooding and asset maintenance. I know from my regular meetings with him that he thinks that those issues are important, and I am sure that they will feature in the Wessex Water plan.
The hon. Gentleman will be pleased to know that the ministerial guidance covers consultation on research programmes on endocrine disruptors. The problem is important, and its effect on freshwater fish should be taken as a biological indicator of potential problems with pollution in our watercourses. We must understand the problem better and find ways to tackle it. I assure the hon. Gentleman that the Government absolutely agree with him on the point.
I also agree with the hon. Gentleman's comments on water metering, which, as he will know from my comments in Committee, is our ultimate aim. As far as we are concerned, the more people who move on to water metering, the better. That movement is taking place, and I suspect that it will continue, particularly in the light of the forthcoming price guidance.
I also very much support the hon. Gentleman's comments about the planning considerations involved in sustainable urban drainage and grey water systems. Again, we are giving great thought to the issue, particularly in relation to large new developments such as Thames gateway, which offers the prospect of building in sustainable water and energy management from the beginning. Some good examples of building regulations, development and design are in prospect. We are giving careful consideration to that.
I also listened to the hon. Gentleman's very blunt statements about Ofwat and Water Voice. They have a job to do. I have a great deal of confidence in the regulator. I also meet with Water Voice. Its job is to protect and promote the interests of consumers, so it will pay a great deal of attention to prices. But groups such as Water Voice would also agree that there must be an element of environmental improvement and sustainable management of water resources. That is also in the interests of consumers.
There is common ground. It is a question of striking the right balance, but it is difficult. There are these pressures. I heard the hon. Gentleman's comments about the price reductions last time, and I understand the point that he was making. Nevertheless, we must try to achieve a balance, minimising the cost to consumers while recognising that there are still improvements to be made. That is what we are doing. The final decision on prices is a matter for the regulator, as the hon. Gentleman knows.

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The hon. Member for Guildford (Sue Doughty) talked about the implementation of the directive. It is a major directive and it is being implemented over a number of years. The Environment Agency's budget has increased and it decides how it allocates its resources. It has about 40 staff who are dedicated to working on the water framework directive, and that number is likely to increase in due course as we begin to develop the implementation programme. The Environment Agency has done a very good job with the Ribble valley pilot scheme, to which my hon. Friend the Member for Stafford referred.
I have been up to the Ribble valley myself to talk to the Environment Agency, English Nature and other stakeholders who are working in partnership on this programme. It is one of the aspects of the water framework that I like. I like the partnership approach, the public consultation and the involvement of people and the various interest groups in river basin planning. That is a strength of the directive. There is scope for integrating the points that she mentioned such as planning and biodiversity action plans. It is certainly being done in the Ribble basin. That is a useful lesson for us in how we extend this to other river basin catchment plans.
The hon. Member for Guildford also mentioned the important "polluter pays" principle, which the Government accept. We have to apply it in a proportionate way when considering who bears responsibility for some of the pollution problems that we face. She also mentioned public information and explanation, perhaps extending that to information on water bills. That is a sensible suggestion. It is a matter for the water companies, but I shall certainly bear it in mind.
It would be good to explain to the public how some of the budget has been spent on improvements, which was a point made by my hon. Friend the Member for Stafford. We have a good record in this country of improvements in water and coastal quality and in reducing pollution. We should point out the increase in the number of blue flags awarded, as my hon. Friend stated, the improvements in our rivers, which in some cases have been dramatic, and the further steps that have been taken in water management. It is important to stress the desirability of this. I am confident that the public support such issues. Indeed, some of what they pay goes towards that. I emphasise that it is not the largest part of the bill, although I note that some press coverage of the recent ministerial guidance suggested that sticking to green issues was the cause of higher bills.
The environmental programme is about 15 per cent. of the spending programme in relation to the overall price review. The bulk of the money goes to pay for the operation of the companies, and it is divided in various ways—capital assets, maintenance, caps on investment programmes and the other important aspects of delivering quality water. It would be wrong, however, to suggest that water bills will increase simply as a result of further environmental improvements. That is not the case. Although it is a part of the reason, it is entirely defensible.
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The hon. Member for Guildford asked about extending the provisions of the water framework directive to smaller areas of water. We can do that, particularly under article 5, whereby we can in due course embrace smaller areas of water. I should like to see that done. The hon. Lady will understand that we want to concentrate on the important wetland areas—they are a priority. However, I do not disagree with her about smaller areas of still water. We can address that under the water framework directive.
The hon. Member for Vale of York (Miss McIntosh) mentioned—
Mr. Kidney:I seek clarification on article 5. In a briefing note, English Nature says that this year's Environment Agency review of what waters will be affected will be binding on the review of river basin management plans in 2009. The agency says that if 88 per cent. of our lakes are left out this year, they will be left out for good. That is not what the Minister is saying.
Mr. Morley:That is not quite my understanding. However, although my hon. Friend is not wrong, we cannot both be right. He is right about the process, but we are using European guidance on small wetlands and biodiversity. The question is how the catchments will protect wetlands both large and small. There is no reason why we cannot consider the matter generally under the article 5 guidance. I should like to go further in due course; the directive has a review period, which will give us the opportunity to consider doing so. I believe that we can deal with small water courses, but the most important thing is to address the river basin catchment plan, taking account of its effect on water in the entire area.
The hon. Member for Vale of York spoke of proportionality in the cost to farmers. I do not disagree; proportionality is the approach that we must take. We must try to be pragmatic and reasonable.
The hon. Lady knows that I am keen on imaginative flood schemes. We have come a long way in recent years in our approach to flood management. We now take a much more integrated and sustainable approach, although we are keen to have soft and hard options for flood defence, or sometimes a combination of the two, and that may involve flooding upland areas. However, I do not rule out compensation if a case can be made for it. Various models of compensation can be provided for landowners. However, landowners who farm on washlands that have traditionally flooded every year because that is the nature of the habitat, and landowners whose land is deliberately flooded as part of a flood management or alleviation scheme, are compensated differently. There is a difference in approach, but we have an open mind and are keen to discuss the matter.
The hon. Lady talked about costings and mentioned a figure of £9 billion. That was a very early figure. The impact assessment is being constantly refined, and we have come a long way from the figure that she gave. Current thinking is that the global figure will be about £450 million to £630 million per annum. Of that figure, the effect on agriculture is estimated as being between £30 million and £210 million. At the moment, these figures should be seen as indicative, not absolute, because I believe that we will refine them further.
Miss McIntosh:Has the Minister been able to discuss the revised figures with the NFU? Will he also report to

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the House on how the pilot scheme in the Ribble valley is working? As he will know from the name, the vale of York does not have too much upland. Will it only be upland that will benefit from his schemes?
Mr. Morley:Not necessarily, although the hon. Lady may have been referring to some of the schemes mentioned in the price review, which relate to schemes that were proposed by United Utilities Water. They are upland management schemes, but they are fairly worthy, and I would like them to have the necessary financial backing, because they might add to our knowledge of water management and catchment management and make it more holistic. The benefits of the scheme have been costed at about £560 million a year, so the scheme should not be viewed simply as a cost that falls on consumers, companies or farmers. It is worth emphasising that the directive will provide a range of benefits.
The hon. Lady also mentioned the Ebro water scheme, with which I am familiar. I have followed the controversy surrounding it, and sympathise with her remarks. She will know that UK taxpayers are contributing to it, as regional funds are being used, but as a former MEP she will also know that the same applies when we receive regional funding through the contributions made by European taxpayers. Contributions should not be presented as a one-way process.
The hon. Lady may be interested to know that our latest information is that the incoming Spanish Government have announced that they do not propose to go ahead with the Ebro scheme, which is interesting. It is also encouraging, in a way, as Spain has several water resource management schemes in places, such as the Cota Doñana national park, which is an area that I know very well and have taken a close interest in for many years. I understand that the impetus behind the park came from a group of English people who were working with local Spanish people and were very involved in the area. There has therefore been a long involvement in this area of international importance.
Mr. Kidney:If the consultation with farmers on diffuse pollution is delayed beyond the end of March, the Minister's Department gave the Plymouth Western Morning News the wrong date. Will the Minister say whether farmers will be pleasantly surprised by the consultation, or will it be another shocking story of cost?
Mr. Morley:There will be a range of measures under the water framework directive. I cannot guarantee that there will not be costs, but costs are not the only way of dealing with diffuse pollution. It is very important that we consider all the options, some of which may be incentives. We should be imaginative, and take a holistic and integrated approach. That is certainly the view of the House, and I very much welcome the very thoughtful and detailed contributions that have been made today. They add to the Government's commitment to making the directive work effectively.

Wandsworth Council
3.30 pm
Tom Cox: With the Minister's agreement, I know that my hon. Friends the Member for Battersea (Martin Linton) and for Putney (Mr. Colman) hope to catch your eye in this debate, Mr. Deputy Speaker. We represent constituencies in Wandsworth, and local organisations in each of our areas will be seriously affected by the reduction of their funding proposed by Wandsworth council. We know Wandsworth council and its policies only too well. It has only one objective: to keep its council tax as low as possible. Although some may welcome that, it deeply harms long-established local organisations that provide a service that is much needed and respected by local people in the communities of Wandsworth. We are talking about one of the richest local authorities in the country. If it truly valued the roles of these organisations, it would be considering not reducing their funding, but increasing it.
Early-day motion 761, which has been signed by more than 50 hon. Members, clearly explains our concerns as MPs for the borough, as well as what the organisations and the people of Wandsworth are saying. In proposing the funding cuts, Wandsworth council is clearly threatening these organisations' very existence. They are organisations that many hon. Members will have in their constituencies and whose value they will know well—citizens advice bureaux, cancer support centres, the Wandsworth bereavement service, the Parkinson's disease service, day centres for the elderly and luncheon clubs. All such organisations are the daily lifeblood of a community. If such groups no longer provide services to local people, who will take over from them? Most certainly, it will not be Wandsworth council. I sought this debate to highlight in the House the deep concerns of local organisations and people in Wandsworth.
I pay the warmest tribute to the local Wandsworth newspapers: the Wandsworth Borough News and the Wandsworth Guardian. For many weeks, they have given these issues a great deal of coverage. Their reporters have not sat in their offices waiting for someone to phone them, but visited the local organisations to which I referred to meet and talk to the people who run them, and the people of Wandsworth who use their services and most certainly want them to continue. Local people's views and concerns have very clearly been reported in the local press. In the Wandsworth Guardian on 12 February, Petra Griffiths, the cancer resource centre director, said:
"This grant is essential as it enables us to function. It seems the council wants to keep their council tax low and have selected schemes like ours for grant cuts that they call low priority. We don't think we come within that category."
How right she is. Do any of us think that a cancer centre that supports and gives advice to patients and their families is a low priority?
Gladys Whigham, who runs the local branch of the Parkinson's Disease Society, said that the proposed cut would leave it with only nine months' funding for a welfare visitor who gives advice and helps its 50 members with benefit claims. She said:
"Unless we can find funding elsewhere—and everyone is looking for funding from elsewhere—we would be making our people pay for their care. That is not providing a service."

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That lady's comments amount to a statement of a clear case. People who need care are often retired people who cannot work because of illness. It is not acceptable to my parliamentary colleagues or to me that such people should be told, "If you want care or services, pay for them." What angers me and many people in Wandsworth is that that is happening in one of the richest local authorities in the country.
Mo Smith runs a luncheon club that is also under threat. She says that it has
"members who have been isolated for up to a year at a time, who have had no real contact with people. We have given them a new lease of life since they have been here."
All Members of the House will fully understand and agree with what she says. Peter Cardy of Macmillan Cancer Relief sums up the matter clearly:
"Less than two years ago, the flagship Conservative council in Wandsworth was so flush with cash that it saw fit to cut its council tax by £50 for a typical band D household. By pure coincidence, this happened just before the London local elections. Apparently, it didn't need the money.
But people living with cancer do need it now. The pre-election savings Wandsworth found could have funded its grant to the excellent Wandsworth Cancer Resource centre alone more than 30-times over."
That is the key to the issue—saving money. It does not matter who will be affected if council tax can be kept low and large sums can be built up in the reserves for elections. My hon. Friend the Minister will be fully aware of the very substantial funding that the Government give to Wandsworth year by year. The debate will clearly show him how Wandsworth council uses some of that funding not as he, I, my colleagues or the people of Wandsworth would expect, but to build up its reserves.
As early-day motion 761 states, there is a very urgent need for discussions with Wandsworth council about why, as one of the richest boroughs in the country, it is cutting funding to key local organisations. I ask my hon. Friend the Minister urgently to demand such a meeting.
3.39 pm
Martin Linton: I thank my hon. Friend the Member for Tooting (Tom Cox) for securing the debate and providing me with the welcome chance to add a few words to his about the performance and practice of Wandsworth borough council. I appreciate that the Minister is not responsible for the council's policies. That is just as well, because if he were, I do not think that he would sleep easy in his bed. However, Wandsworth's recent actions must make him question its performance and practice. The authority was described only two years ago as excellent, but now, sadly, it is short-sighted and self-defeating.
The cutting of the grant to the cancer resource centre, which my hon. Friend mentioned, is particularly self-defeating, since it is recognised as a pioneering organisation in providing support and home visiting for cancer patients. I attended its 20th anniversary reception last year in the Commons, which was attended by the Minister, my hon. Friend the Member for Stevenage (Barbara Follett) and the chairman of the all-party cancer group, my hon. Friend the Member for Norwich, North (Dr. Gibson), who gave enthusiastic
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tributes to the Wandsworth campaign as a prototype for local cancer groups. At a similar event attended by Wandsworth councillors, Conservatives lined up to say how much they admired the organisation, but they have now voted to withdraw its grant. The centre will have to close if the grant is withdrawn. It is used to pay for rent and key staff to run it, and there is no alternative way of paying the rent.
I am more concerned about the knock-on effect of withdrawing the grant, which will place a larger burden on the council's statutory responsibilities, costing it more than is saved by not making the grant. There will be more demands on social services and the national health service. The same applies to the cut in Wandsworth's bereavement service; it also does a fantastic job in the prevention field, which is reflected by many letters that I have received.
The council also tried to justify the closure of pensioners' luncheon clubs, saying that they are aimed at a younger and more able section of the older population. However, anyone who has visited the clubs will know that it is often such clubs that keep elderly people more active and mobile. I will read one paragraph from a letter that I received from a pensioner in my constituency:
"The luncheon club is a window into the outside world for many a pensioner who will, after leaving the club, spend the rest of the day and night without seeing or talking to another human being … Try to picture yourself alone in an empty room, hoping that somebody will call; then the phone rings and one of your mates from the luncheon club says, 'Don't forget, it's roast beef tomorrow. See you there'."
That is the kind of organisation that will have to close.
Even more destructive is the decision not to passport £529,000 to Wandsworth's schools, which follows a refusal last year not to passport £1.7 million to the schools budget. It is not as if Wandsworth is hard done by. The Government gave it £227 million this year and rely on the council to match the increase in education funding. However, the Government fund about 84 per cent. of Wandsworth's spending, which is one of the highest percentages in the country, while the council refuses to pay its share of the schools budget.
The refusal to passport might be understandable if Wandsworth had the highest education spending, but it has the lowest spending per secondary pupil in inner London in the current year, and it will do so again in future. Its refusal to match the Government's investment in education is appalling. It is taking away from the schoolchildren of Wandsworth £500,000 this year and £2.2 million in all, which it was given to invest in their education.
Wandsworth used the excuse that those cuts were necessary because the Government threatened to use their powers to cap the council tax if the council tried to increase the tax above a certain amount. That excuse is now seen as disingenuous and misleading, because there was never any likelihood that the Government would use their powers to cap Wandsworth and, in any case, it emerged three days later that Wandsworth had no intention of increasing council tax by anything like the amount that would have risked its being capped. Indeed, the council announced a zero increase in its spending. It is total bunk for Wandsworth to try to blame the Government. The cuts are entirely the responsibility of

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the leadership of Wandsworth council, and they are not being carried out in any way at the behest of the Government.
More serious than that is the element of bad faith. On 1 January, Wandsworth promised in its indicative schools budget to passport the full amount to the schoolchildren of Wandsworth, with the proviso that it reserved the right to reconsider if material conditions changed. It then announced earlier this month that it would passport not the full amount, but only 93 per cent., and retain the remaining £500,000. However, it is not true that any material changes have occurred. The authority simply tried to mislead the Government into not using their powers under the Education Act 2002 and then changed its mind. That must have been in its mind the whole time, because it was the only party that knew what the council tax rise was likely to be.
I argue that the Government still have powers under the Education Act 2002 to force Wandsworth to passport the full amount. I know that it is after 14 January, but it is less than a fortnight since the announcement that the authority did not intend to passport the full amount. I urge my hon. Friend the Minister to speak to his colleagues in other Departments, and especially the Department for Education and Skills, to remind them that they still have the legal power to use their right.
The future of schoolchildren in the London borough of Wandsworth is at stake. I do not criticise the schools, but I do criticise the council, which is vested with responsibility for education, for withholding money that was paid by the Government to be spent on the children of Wandsworth. The council is retaining that money for political reasons. The Government are beholden to use their powers to ensure that the money finds the recipients for whom it is intended.
3.46 pm
Mr. Tony Colman: I, too, congratulate my hon. Friend the Member for Tooting (Tom Cox) on securing the debate, and I agree with every word that he and my hon. Friend the Member for Battersea (Martin Linton) said. I also welcome the Minister, who grew up in Battersea and went to school in Putney at Southfields school, Wandsworth, where he was head boy. The school was closed by the Conservatives and reopened under a Labour Government as St. Cecilia's, Wandsworth. I am pleased that my son is a pupil at that school.
Having started on that light note, I, too, wish to express my sadness at the loss of the regenerate.com luncheon club, headed by Mo Smith in Roehampton, and the Ashburton and Arndale luncheon clubs. Those clubs are a lifeline to many older people in the community and it is essential that Wandsworth continue to fund them.
My hon. Friends did not mention the cut of some £215,000 in the budget for the citizens advice bureaux, which led to the closure of the Putney CAB, a lifeline for my constituents who need legal advice. I support what has been said about those Wandsworth-wide groups, to which the constituents of all three hon. Members who have spoken in the debate have access. I am very proud of the cancer resource centre, which is a world centre, but that pride does not extend to Wandsworth council.
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Funding for the bereavement service is going, and so is funding of the local Parkinson's disease service, which will be a real loss. The council has very large reserves that could fund the groups, and it could restore tomorrow what is being cut if the Minister spoke to the leader of the authority and told him what was going on.
I echo the concern expressed about the shortfall in the schools budget; it was £1 million last year and it is £1 million this year. I understood that Wandsworth was the one council in London that was not passporting its money, but this afternoon I received a letter from Sir Jeremy Beecham stating that Wandsworth is the one council in the UK that is refusing to passport the money. That is an extraordinary situation, and as Sir Jeremy said, it completely undermines the concept of local authorities having a role in education funding.
Like my hon. Friends, I have long queues at my surgery of people who are concerned about what is happening in Wandsworth council. They are worried about housing repairs and about the diminishing level of social housing. The council has made no attempt to deal with the housing shortfall in the area, and that is something that the Minister should become involved in.
Wandsworth is very proud of its rank as an excellent council and it is important to take that on board. It is interesting to read what it says on its website about the corporate assessment:
"Communication of the council's priorities is exemplary. Universally, and with whatever degree of support or concern, stakeholders and partners reported that one of the key strengths of the council is the sharp clarity of its priorities and what it will and will not do."
We are talking about what the council will not do. On "Focus", the assessment says:
"The council is not distracted by the need to address sudden unexpected crises."
The council has
"good intelligence, a clear picture of what matters, and a good early warning system for future issues."
Might I suggest that Wandsworth has not lived up to the billing that the Audit Commission gave? I would support "CPA—The Way Forward", in which the commission said:
"We are continuing to have discussions with central and local government stakeholders about the approach to be adopted in the case of 'excellent' councils whose services slip."
Services are slipping in Wandsworth.
The officers in Wandsworth are brilliant. They do all they can to keep services going. I asked one senior officer, who has since retired, why he remained at Wandsworth. He said, "If I left, the cuts would be deeper, the services would get worse." I look forward to seeing the Minister intervening where the services are slipping.
3.51 pm
(Phil Hope): I congratulate my hon. Friend the Member for Tooting (Tom Cox) on securing this debate. I also congratulate my hon. Friends the Members for Putney (Mr. Colman) and for Battersea (Martin Linton) on their forthright support for the passionate contribution that my hon. Friend the Member for Tooting made on behalf of his constituents,

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the voluntary and community organisations in the borough and the schools whose the pupils and parents are so anxious about the problems that they face. I note that my hon. Friend's name is at the top of early-day motion 761, for which he has garnered wide support—
3.52 pm
Sitting suspended for a Division in the House.
4.5 pm
On resuming—
Phil Hope:Before I was interrupted, I was saying that my hon. Friend the Member for Tooting had his name at the head of an early-day motion that describes his very substantial concerns. I see the signatures of 53 other hon. Members who support him, and my hon. Friends the Members for Putney and for Battersea have supported him today in expressing concern about the decisions that Wandsworth council has taken about its council tax. Having grown up and gone to school in the area, as my hon. Friend the Member for Putney reminded us, I am sad that today's debate on Wandsworth should be about difficulties and negativity.
On 5 February, Parliament approved the local government settlement for 2004–05—the next financial year—which provides a generous grant increase of 5.5 per cent. and an overall increase of 7.3 per cent. Since taking office, the Government have increased funding by 30 per cent. in real terms. Indeed, my hon. Friend the Member for Tooting noted at the beginning of the debate the Government's support for local government. That contrasts rather starkly with the 7 per cent. real-terms cut made over the last four years under the Conservative Government. As a former county councillor who had to deal with huge budget cuts as a result, I know how much local government has benefited from the past seven years of Labour Government.
In the recent grant settlement, we reduced the ring-fenced grant from more than 13.3 per cent. to about 11 per cent. of the total grant. That is part of our overall commitment to reverse the trend on the ring-fencing of grants to local authorities.
We have always said that there is no need for excessive council tax rises. I shall come to the Wandsworth point in a second. We said that, given the generous settlement for next year, we expected to see council tax increases in low single figures, and we are encouraged by the evidence that many councils have listened to our exhortations to lower their council tax increases. A general point is that we have targeted capping powers and we will use them as necessary. We will decide on capping principles when we have received and examined the final detailed budgets from all councils. We will not cap for the sake of it, but we will cap to prevent taxpayers being subjected to excessive rises.
I shall now focus on the funding and council tax increases in Wandsworth. In the financial year 2002–03, Wandsworth received a 4 per cent. increase in funding. In 2003–04, there was a 3.5 per cent. increase, and in
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2004–05, Wandsworth council will receive £227 million in grant—an increase of almost £9 million or 4.1 per cent.
Apart from the general grant funding, Wandsworth is receiving substantial further funding from the Government for 2004—05. That includes £12 million from the Department for Education and Skills, £5.7 million from the Department of Health and £400,000 of neighbourhood renewal funding. Wandsworth received £400,000 of e-government funding in 2002–03 and 2003–04, and it can expect further substantial support for e-government in 2004–05.
Now let us consider Wandsworth's council tax increases for the same period. In 2002–03—an election year—the borough had a council tax increase of minus 25 per cent. In 2003–04—after the election—it had an increase of 57 per cent., and for 2004–05, the increase is 0 per cent. I leave hon. Members to draw their own conclusions on Wandsworth's financial management, given that track record of council taxes, but I would like to draw my hon. Friends' attention to two contributions made to the debate from other quarters. They may have seen a letter sent by my hon. Friend the Minister for School Standards to the leader of Wandsworth borough council about school funding and passporting into the schools budget. My hon. Friend said:
"At our meeting earlier today you made a number of assertions about the possibility of budget-capping in 2004–05 and said that in the light of those concerns you are proposing no increase in the council tax rate and passporting at only 93.7 per cent."
"I have spoken to Nick Raynsford"—
my right hon. Friend the Minister for Local and Regional Government—
"and can give you that reassurance: as Nick Raynsford has made clear on a number of occasions, where Councils set a council tax increase in low single figures they will not be capped. I understand that Wandsworth could passport in full with a council tax increase of some 2 per cent. There is therefore no case for Wandsworth to break their promise to passport the full SFSS increase to schools, as the risk of capping does not exist. You said that you were committed to education and funding your schools. You have the opportunity to make that commitment a reality."
I read that out in full because it demonstrates that the Government are not happy with a council that decides not to passport 100 per cent. of a grant to schools.
My hon. Friend the Member for Battersea asked about the legal powers to enforce passporting. Regrettably, we can act only when the council considers the proposed schools budget inadequate, and we must act within 14 days of the 31 December deadline. We have passed that deadline and are therefore unable to use the powers to which he referred.
I hope that my response has made the Government's position clear. I also draw Members' attention to a letter sent by Sir Jeremy Beecham, who is chairman of the Local Government Association, to the council leader. He also sent a copy to the Government and the media. He said:
"I am bound to say that it is impossible to avoid the conclusion that political games are being played."
That is the case, and we are deeply concerned.
Budgetary decisions, including on the funding of voluntary bodies, are a matter for individual local authorities, because of the nature of the democratic structures in this country. Therefore, any cuts that

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Wandsworth borough council makes in its grants to voluntary organisations in Wandsworth are a matter for that council. However, I point out that Wandsworth, like every other council, is accountable to its electorate for its spending decisions. I make that point—
Mr. Deputy Speaker: Order. We must now turn our attention to pigswill.

Pigswill
4.13 pm
Mr. Boris Johnson: On 24 May 2001, three months after the outbreak of foot and mouth, there entered into force the Animal By-Products (Amendment) (England) Order 2001. At the stroke of a bureaucrat's pen in the Department for Environment, Food and Rural Affairs, there perished in this country a practice that has taken place for thousands of years, ever since mankind domesticated animals—the feeding of food waste to pigs in the form of swill feed.
I know that Members on both sides of the House want to contribute in this short debate, so I do not propose to waste time by disputing the logic of that decision, although I believe that it was illogical to penalise innocent swill feeders for the irresponsible behaviour of one, who may or may not have been implicated in the outbreak of foot and mouth. I hold out no hope that the Minister will do the right thing and revoke the ban, but it is right to draw his attention to its adverse effects, which, like so many pieces of regulation, is adding to the costs of business and industry.
To take one example, Phyllis Court hotel in Henley must now pay an extra £1,000 a year to a licensed collector, whose responsibility is to remove wet waste that previously went to a pigswill feeder. Given that there is room for only three years' waste in our landfill sites, that is not the cleanest and greenest solution. It is estimated that the ban on swill feeding is generating an extra 1.7 million tonnes of waste per year, and that which does not fill up our landfill sites must be going down our drains, clogging up the sewers and attracting vermin.
Yet of all the people who are suffering the ill effects of the ban, the worst hit are the 62 previously licensed swill feeders. It is the injustice to them on which I shall concentrate. I will show that the Government have been triply culpable in their behaviour towards the swill feeders and therefore owe them compensation. There is the simple moral case: many swill feeders were urged by the Ministry of Agriculture, Fisheries and Food to buy very expensive equipment and a few months later that machinery, like their profession, was redundant.
The Minister for the Environment said last week in the House that he would not compensate the 62 swill feeders for this Government-imposed frustration of their Government-inspired expectations on the principle that the Government do not compensate for the introduction of health and safety measures. He cited in support of his actions the Tory Government's refusal to compensate those who de-boned the heads of animals when that practice was banned during the BSE crisis.
Hansard records how in 1996 the hon. Member for Scunthorpe (Mr. Morley), now the Minister for the Environment, clamoured for compensation for the head de-boners saying that the Government had a moral duty to compensate them. Someone has changed his tune. I expect the Under-Secretary of State for Environment, Food and Rural Affairs will invoke the prerogative of government to hypocrisy, to say one thing in opposition and to do another in government. He will brush aside the moral obligation that I believe is on him and his Government. I must warn him that they face a far more difficult legal challenge. Government negligence created

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the conditions in which the foot and mouth outbreak became more likely and the innocent 62 swill feeders were made more likely to suffer for the Government's negligence.
It is now obvious that at the time of the outbreak the UK Government were in material breach of article 15, paragraph 3, of EU council directive 80/217/EEC, in that the UK's Animal By-Products Order 1999 allowed
"the consigning of swill from premises approved for the processing and feeding swill to other holdings".
Now the EU directive did not ban swill feeding—far from it. In fact the Minister may have inadvertently misled the House when he said that it had been banned across Europe, because it will continue in Germany, Italy and Austria until at least 2006. It might have continued here if Ministers had had more gumption and had stood up for the industry in this country.
The EU directive demanded a more stringent regime than that imposed in Britain, and it could be argued—I should warn the Minister that it will be argued when the matter comes to adjudication by the courts—that the UK Government's lax implementation of the directive created the conditions in which irresponsible and unhygienic swill feeding, of the kind we saw at Bobby Waugh's farm at Heddon-on-the-Wall, was more likely. That made the outbreak of foot and mouth more likely and the innocent swill feeders more likely to be punished for the crimes of the guilty few.
I need hardly remind the Minister, who I am sure is an expert in European law, that under the Francovich ruling the European Court of Justice laid down the principle of state liability for damage caused to individuals by breaches of community law, giving rise to an obligation on that state to make good such damage. Even if, as I hope will not be the case, the Minister does not accept that he and his Government have a moral duty or any legal obligation under Francovich principles, there is the simple moral point that the UK Government failed adequately to enforce their own regulations, never mind EU regulations.
A report by the EU Commission conducted from 1 to 5 October 2001 not only highlighted the legal discrepancies, but found that two former swill feeders were failing to comply with the Animal By-Products Order 1999. The report pointed out that
"insufficient hygiene standards have allowed for the contamination of clean areas by unclean waste".
In other words, it found that the UK Government were not sufficiently enforcing their own Animal By-Products Order, never mind implementing the EU directive correctly.
The clinching point in my case is that made by Mr. Jim Dring, the state veterinary officer responsible for reviewing Bobby Waugh's licence a mere 14 days before the index case of foot and mouth disease appeared on his farm. In a statement dated 5 Oct 2001, Mr. Dring accepted that had his inspection
"been more rigorous than it was, had the licence not been renewed, or renewed subject only to radical revision of Waugh's patently deficient feeding technique, then this awful 2001 foot and mouth epidemic would never have come about."
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There could be no clearer admission by the emanations of the state of failure adequately to police their own regulations, nor could it be clearer that, had the state done its duty properly, there would have been no need to ban an innocent and ancient practice.
That is the moral and the legal case for treating those 62 swill feeders well, rather than just brushing them contemptuously aside—as the Minister has been tempted to do in the past—as people engaged in a sordid and mildly amusing activity, which is unlikely to command public support. They may be involved in a mucky business, but that is no reason to treat them like muck.
We must err on the side of caution in the agriculture sector, but my case is that the disaster took place precisely because the Government did not err on the side of caution in implementing the directive and enforcing the law; they must bear the responsibility for that.
I urge the Minister to consider how his Department's money will be best spent—in lodging lawyers in Luxembourg to fight a case in which the Government do not occupy the moral high ground, and which is, at best, legally uncertain, or in doing the right thing by the representatives of an ancient British industry who have been done out of a job through no fault of their own.
4.22 pm
Mr. George Howarth: I congratulate the hon. Member for Henley (Mr. Johnson) on securing a debate on an important subject. He may have over-egged his pudding in terms of the politics, but the basic point that he makes is correct.
Two potential issues are at stake that should be explored thoroughly and properly in the debate and by the Government, but that has not yet happened. The first issue is whether there has been a failure in policy or procedure by the Government. One incident triggered a ban that affected every swill feeder in the UK. The incident was serious, and it may be the case, although there is some dispute about it, that that incident triggered off the whole problem with foot and mouth disease. However, all swill feeders suffered the consequence of that one lapse. The decision was rushed through in a matter of days—there was no proper consultation, compensation or consideration of the effect that it would have on those swill feeders' livelihoods.
Mark Prescot and his brother were pig farmers in Melling in my constituency. They are not pig farmers any more. They had spent quite a lot of money on the correct equipment, but they were then prevented from engaging in that activity and were given no compensation for the money that they had invested in the equipment. I contend either that the Government were unfair or that they overreacted. If they overreacted, there is a case for maladministration. I have referred Mark Prescot's case to the Parliamentary Commissioner for Administration—several other hon. Members have referred similar cases to him—and he will determine whether there has been maladministration. I believe that there has, but will await his verdict.

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However, even allowing for the fact that that investigation is under way, the policy was unfair. Comparisons can be made with deep-sea fishermen and mink farmers, all of whom were compensated for having to disengage from the industries in which they were involved. However, no serious consideration was given to the pig farmers. The most that Mark Prescot got was a helpful consultant who looked at his land and the activities in which he was engaged and concluded that he could not think of anything else that he could do except put in a fishing pond. That was helpful, although Mark Prescot realistically decided that charging people to use a fishing pond might not be the most economic use of his land. That is the only assistance that he received.
Among all the problems in my constituency—yours, Mr. Deputy Speaker, is situated next door to mine and suffers from similar difficulties—it may seem strange for me, as an urban MP, to be taking up this one. However, the fact is that my constituent has lost his livelihood and has not been compensated in any way. That is almost unprecedented. I cannot remember any other industry that has, in effect, been destroyed without any consideration of compensating those involved for the loss of their livelihood. It is quite possibly a case of maladministration—that remains to be seen—but it is most certainly a strong case of unfairness.
4.26 pm
Ann Winterton: I congratulate my hon. Friend the Member for Henley (Mr. Johnson) on introducing this important debate. I was involved with the issue in 2001, when I received representations from Mrs. Lynda Davies of the Association of Swill Users. As a result, I met Mrs. Davies and the Rev. Keith Ineson of the Salvation Army's agricultural chaplaincy in Cheshire to discuss the severe difficulties experienced by swill users. I pay tribute to Keith Ineson for his valuable work during the foot and mouth epidemic, and I am sorry to hear that he has been made redundant: he is the last agricultural chaplain in the United Kingdom.
In November 2001, Keith Ineson reported to me that 41 farmers in Cheshire, most of whom were tenants and had no alternative business or accommodation, were in dire straits, placing many families under great stress. Mr. Ineson reported to me that one elderly farming couple were then living on an income of just £100 a month. I remain concerned that the manner in which the ban on pigswill was implemented by DEFRA paid insufficient attention to the practicalities faced by the majority of farmers using pigswill, in addition to the detrimental way in which the ban impacted on pig farmers' livelihoods.
The decision to introduce a ban was based on the evidence derived from a single case of pigswill use, which was then considered to have been the source of the outbreak of foot and mouth disease, rather than on the usual methods of collection, storage, processing and distribution used generally by pig farmers in the United Kingdom. The feeding of catering waste to pigs was subject to a host of stringent rules and regulations, to which farmers working under licence firmly adhered, and Ministry of Agriculture, Fisheries and Food inspectors visited farms every three months. The failure was due to the lack of inspection, and not to the pigswill users.
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There were particularly difficult circumstances pertaining to animal husbandry in the United Kingdom at that time, and DEFRA instituted an extremely brief period of consultation in which interested parties could participate. Even with meaningful consultation, the Department's stringent proposals were not amended as a result of the limited number of representations received during that short period. As a direct result of the ban, a considerable number of small businesses, each feeding an average of 1,500 pigs, were lost. These farmers were given a maximum of 10 days' notification in which to finish feeding pigs completely or to adapt their plants to take alternative feeding methods. Both options were totally unreasonable and unworkable, given the time factor involved.
I do not want to take any more time, except to make the point that in Europe. pigswill continues in Austria, Germany and Italy, those countries having obtained a derogation until 2006. They are more fortunate than the 62 swill users who, at the stroke of a bureaucrat's pen, were put out of business in this country. If justice is to be done, they should be compensated.
4.30 pm
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs: I congratulate the hon. Member for Henley (Mr. Johnson) on securing this debate.
It may be helpful if I put the debate on pigswill into its historical context. Legislation controlling the feeding of waste food to animals is not new. In the 1940s, there were a number of swill-related orders, including the Diseases of Animals (Boiling of Animal Foodstuffs) Order 1947 and the Foot and Mouth Disease (Disinfection of Road Vehicles) Order 1941, which was introduced during the war. Since then, the controls have been progressively strengthened in recognition of the risks of feeding food waste to animals and with the aim of trying to avoid outbreaks of serious diseases such as foot and mouth and classical swine fever. Significant among those were the orders of 1954, 1973, 1987 and 1999.
Until recently, swill feeding was considered a useful way to dispose of waste food, provided that the legislative requirements were strictly adhered to. What made us review that practice? In 2001 we had the worst outbreak of foot and mouth disease in living memory. Following the outbreak, the risks from swill feeding became much greater. Before the outbreak, the main risk was from the feeding of imported infected meat products. Afterwards, there was a much greater risk of infectivity from domestically produced meat because of the amount of virus in circulation. That is why we introduced the ban when we did, in order to reduce the risk of foot and mouth spreading. After the introduction of the UK ban, the European Commission proposed an EU-wide ban on swill feeding of waste food to livestock. We supported the continuation of that ban, which now applies across the Community, with Germany and Austria, and not Italy, granted a four-year transitional phase-out period.
Perhaps the hon. Member for Henley opposed the ban in the first place, but he suggested that after foot and mouth we should have reintroduced swill feeding, but

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with stricter controls. We were not prepared to do so, and the Anderson inquiry into foot and mouth recommended that we should not do so.
Mrs. Angela Browning: Since the Minister has mentioned the Anderson inquiry, perhaps he can deal with the one point that I wished to make. My hon. Friend the Member for Henley (Mr. Johnson) has brought the issue forward and we have all had sight of Mr. Dring's full report. However, that report was not available to the Anderson inquiry. The Secretary of State has admitted that, although the report was available to Ministers, they chose not to make it available to Anderson. It is clear to anyone who has read the report that it is pertinent to foot and mouth. In the light of the new evidence now in the public domain, will the Minister reconvene the Anderson committee to see what lessons should be learned from that important document?
Mr. Bradshaw:No, I shall not do that, but I shall address the genuine concern that the hon. Lady raises.
The origin for the 2001 outbreak is considered to have been at Burnside farm, Heddon-on-the-Wall, Northumberland, which was licensed to feed processed waste food under the Animal By-Products Order 1999. Burnside farm was permitted to obtain processed waste food from approved premises. Following the outbreak, evidence was found of unprocessed waste food having been fed to pigs at Burnside farm. That is the most likely source of infection of the pigs.
As hon. Members have said, in recent days there has been highly misleading and mischievous press coverage based on selective quoting of a personal statement made by the local MAFF vet, Jim Dring, in autumn 2001 about his contacts with the Waughs' farm in the run-up to the outbreak. I have decided today to publish Mr. Dring's personal testimony in full, so that people can read it and make up their own minds. A copy has been placed in the Library and on the DEFRA website. Far from showing any incompetence on the part of Mr. Dring or the then MAFF part, I believe that the document shows a dedicated and conscientious vet dealing with some difficult customers who went out of their way to conceal dangerous and illegal activity on their farm. To suggest, as some have done, that Mr. Dring was responsible for the foot and mouth outbreak is like saying that a police officer who misses a piece of evidence at the scene of a crime is responsible for that crime rather than the criminal himself.
Ann Winterton:Will the Minister give way?
Mr. Bradshaw:No, I shall not do so any more.
There has also been some confusion about the EU directive that governed the feeding of pigswill at the time, which the hon. Member for Henley mentioned. The directive permitted the treatment of swill in specialised establishments under official control and provided for such swill to be consigned from those establishments to approved premises. It states:
"Member States may authorize the treatment of swill in specialized establishments equipped for the purpose, on which there are no animals and which are under official control. In this
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case, by way of derogation from paragraph 2, the swill may, after heat-treatment, also be used for the feeding of pigs other than fattening pigs, provided that its distribution and use are controlled so as to avoid any risk of the swine fever virus spreading".
In my Department's view, our legislation fully implemented the provisions of the directive. Consigning properly processed swill from approved premises to approved swill feeders was, at that time, a legitimate activity, and it was permitted under the directive.
Mr. George Howarth:Does my hon. Friend accept that my constituent Mark Prescot, for example, complied fully with those regulations and yet was stopped from using swill feed and therefore lost his livelihood? Does that not deserve compensation?
Mr. Bradshaw:That was very unfortunate for my hon. Friend's constituent, but I will come to the issue of compensation in a short while.
As I said, the introduction of the Animal By-Products Order 1999 provided more stringent controls than ever before. However, experience demonstrated that no matter how stringent the legislation, there will be those who will do not follow the rules. In the case of foot and mouth disease, which cost the country approximately £8 billion, that had catastrophic consequences. There is only one conclusion to be drawn: the Government made the right decision in banning the feeding of swill to pigs.
I turn now to the issue of compensation, which was raised by my hon. Friend the Member for Knowsley, North and Sefton, East (Mr. Howarth). I fully appreciate that the introduction of the ban affected a group of producers that combined two roles—waste collector and pig farmer. In the past, Governments have not compensated farmers for changes in feed material available for their livestock. The ban did not prevent those affected from keeping pigs, although I accept that some farmers may have faced additional costs to adapt their feeding systems.
Pig producers, including former swill feeders, may continue to feed their livestock vegetable or bread waste or liquid feed that neither contains the banned products nor has originated from a kitchen or other premises where meat has been handled. Equally, the business of waste food collection could continue provided that no livestock are kept on the premises to which the waste was taken. In those circumstances, the waste would have to be disposed of by the collector at an approved disposal site.
My hon. Friend the Member for Knowsley, North and Sefton, East made comparisons with other sectors—the fishing and mink farming industries. The ban on mink farming prevented producers from farming mink, whereas the ban on swill feeding did not prevent the keeping of pigs. As I stated, it is not Government policy to compensate farmers for changes in the feed material available for their livestock and it would not be appropriate to start that now. The announcement made by my hon. Friend the Minister for the Environment in April 2001 about a £22.5 million package of aid to the fishing industry was not about compensation; it was an encouragement to adopt more sustainable fishing practices and to rationalise the industry through decommissioning.
The Government did, however, assist swill feeders in other ways. Free business advice from professional consultants was made available to all registered swill

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users and processors. Our records show that there were 93 of these, and I am aware that the reaction of those that took part was mixed, but it was a major effort to provide practical assistance.
Other opportunities were available, such as the rural enterprise scheme to help diversification, details of which have been made available to those campaigning on behalf of the swill feeders. I consider that the Government have not only gone to considerable lengths to listen to the concerns of former swill feeders, but done what they can to make available practical assistance to help overcome the difficulties that the ban may have caused individual businesses.
Mr. Boris Johnson:Will the Minister specify exactly what practical help the Government have given to those swill feeders and why it cannot be extended to compensation for the machinery in which they have invested considerable sums?
Mr. Bradshaw:As I said, such compensation would set a precedent. The practical help is what I have just outlined: free business advice and help to encourage the swill feeders to diversify and to stay in business.
The hon. Member for Congleton (Ann Winterton) made a point about the consultation. The reason why the consultation period was brief was that we were in the middle of a foot and mouth outbreak. There were a good number of responses to the consultation. The overwhelming majority of organisations, including the National Farmers Union, the National Pig Association, the National Consumer Council and the Meat and Livestock Commission, supported the Government's decision to ban feeding pigswill to pigs.
Ann Winterton:They replied as they did because they were unaware that the Department for Environment,
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Food and Rural Affairs, or MAFF as it was, had failed to inspect the premises in question. MAFF, not the pigswill user, was the true culprit.
Mr. Bradshaw:I do not accept that at all. When the hon. Lady reads Jim Dring's report in full, she will reach the same conclusion that I reached, which is that the culprit was a farmer—
Ann Wintertonrose—
Mr. Bradshaw:I shall not give way. The culprit was a farmer who was indulging in a dangerous and illegal activity, and Mr. Dring made every effort to do his job properly when he made his January visit. No one has suggested that he was negligent or that he missed important evidence. It is very easy for hon. Members to say in hindsight that the activity was obvious. It was not. I suggest that the hon. Lady reads the verbatim report made when Mr. Dring visited the farm in January.
The hon. Member for Henley also expressed concern that the ban has increased the amount of waste going to landfill. That needs to be put into context. When the ban was introduced, the number of pigs fed on swill amounted to approximately 1.5 per cent. of the national herd, which is very few pigs. The amount of waste food being used to feed pigs was not great compared with the amounts of waste food going to landfill from other sources. However, the Government take their recycling targets seriously and are aware that the amount of biodegradable waste sent to landfill must be reduced, not increased. DEFRA strongly supports the option of composting and the biogas treatment of catering wastes. Those plants must be approved under the animal by-products regulation. Given that that legislation was introduced only recently, we have been doing well in dealing with applications for approval. To date, 10 plants are being validated and are now treating catering waste.
Question put and agreed to.
Adjourned accordingly at eighteen minutes to Five o'clock.

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  Nursing
  Nursing
  Teacher-Pupil Ratios
  Teacher-Pupil Ratios
  Teenage Pregnancies
  Teenage Pregnancies
  Voluntary Sector
  Voluntary Sector
  Waiting Times
  Waiting Times
NORTHERN IRELAND

  Water Cannon
  The Minister of State, Northern Ireland Office (Jane Kennedy)
  I have today placed in the Library guidance developed by the Association of Chief Police Officers on the deployment and use of water cannon, together with a medical statement on the use of water cannon by the independent medical panel. Copies of these documents have been placed in the Library of the House.

  With the publication of this guidance and the final medical statement, the water cannon purchased by the Police Service of Northern Ireland can now be deployed operationally for use in appropriate circumstances.

DEPUTY PRIME MINISTER

  e-Innovations Fund
  The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Phil Hope)
  The Government will be announcing the first round of successful bids for matched funding to support e-Innovation in local councils. Some 34 councils will receive matched funding of £6.2m to deliver their innovative ideas by March 2005.

  These projects complement the work of individual councils, pathfinders, national projects and partnerships that are already being carried out under the programme, in particular by driving forward "cutting edge" projects, which look beyond December 2005.

  This round of support for e-innovations targets the following four themes:

  E-Learning
  This includes the internal sharing of information and good practice, staff development and better use of e-government to assist service transformation (i.e. not mainstream education/schools).
  Bridging the Digital Divide
  This includes using e-government in ways that help services to reach those socially excluded and in particular addressing the concern that e-government might lead to some people being further isolated from the support and services they need.
  Emergent Technology for Better Government
  Innovative use of information and communications technologies (ICT) to improve services.
  Local Authority E-Business
  Better use of ICT to improve internal business processes in councils, including service planning and performance management.
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  A full list of the councils receiving funding is tabled below:

  Successful e-Innovation Bids

  Local Authority

  Project Title

  ODPM Grant Contribution

  Bridging The Digital Divide

  Camden LB

  Virtual Viewing—Extending Choice Through Virtual Tours

  200,000

  Chiltern DC

  Seeing The Divide—A Picture Paints A 1000 Words

  62,000

  Derbyshire CC

  Helping Older People Bridge The Digital Divide

  152,500

  Kings Lynn and West Norfolk BC

  Community Heritage Stores—Enngaging The Wider Community Online

  78,000

  Manchester CC

  The Manchester E-Markets—Mems—Project

  100,000

  North Cornwall DC

  Rural E-Champions—Bridging The Digital Divide

  50,000

  Pereston CC

  E-City Perston—Bridging The Digital Divide In England's Newest City

  300,000

  Sandwell MBC

  Personalised Access Authentication

  250,000

  Sutton LB

  Widening Community Access To Services

  125,000

  West Devon DC

  SMS Access Channel In Rural Areas

  50,000

  Working BC

  Trusted Partner Access

  110,000

  e-Business

  Cambridgeshire CC

  Local Operational Partnership Scheme(Lops)

  200,000

  Caradon DC

  Local Authority E-Business

  62,320

  East Sussex CC

  East Sussex In Figures

  130,000

  Knowsley MBC

  Exploiting Information Management

  75,000

  Lewisham LB

  Electronic Invoicing

  135,000

  Uttlesford DC

  Uniting Services For Our Community

  78,000

  West Sussex CC

  The Mysociety Partnership

  250,000

  e-Learning

  East

  Elp (E Learning Programme)

  75,000

  Northamptonshire DC

  Lambeth LB

  Web Wise And Web Watch

  150,000

  Lancaster CC

  The Learning Ladder

  50,000

  Tameside MBC

  Knowledge Management

  350,000

  Teignbridge DC

  Prince2—Practitioner cE'& Distance Learning

  50,700

  New And Emergent Technology

  Colchester BC

  Questions On The Move

  90,000

  East Riding of Yorkshire Council

  The East Riding Digital Learning Community (Die)

  125,000

  Hammersmith and Fulham LB

  Using New Technology To Improve Parking Services

  335,000

  Liverpool CC

  Text 2 City of Liverpool

  200,000

  Merton LB

  Enhance The Level Of Domiciliary Monitoring And Emergency Support By Using Chromatic Technology In The Homes Of Elderly, Disabled And Newly Discharged People

  214,000

  Newham,LB

  Regentv

  460,000

  Rossendale BC

  Open Source Software

  502,500

  Somerset CC

  Self-Service In Libraries Using RFID

  112,500

  South Lakeland DC

  3d GIS Virtual Town Planning Model

  66,000

  Test Valley BC

  Local Services Link

  494,000

  Westminster LB

  Soho Wireless Technology

  500,000

  TOTAL

  6,182,520

ENVIRONMENT, FOOD AND RURAL AFFAIRS

  Annual Report on Progress towards Sustainable Development
  The Minister for the Environment (Mr. Elliot Morley)
  I am pleased to announce that the 2003 UK Government annual report on progress towards sustainable development,"Achieving a better quality of life" was launched today. This is the fourth and last annual report of progress against the 1999 Sustainable Development Strategy for the UK.

  The report sets out the progress and key developments made towards sustainable development since the 1999 strategy, and brings together the latest data on the 15 headline indicators which comprise the `quality of life barometer'. It also provides an overview of many of the initiatives and mechanisms that the UK Government have put in place that help contribute to 'a better quality of life for everyone'.

  The headline indicators show that overall we are making progress across the three pillars of sustainable development: the economy, society and the environment. However we are doing better in some areas than others. It recognises that much more remains to be done—by Government, business and the individual—to put the UK firmly on a path towards sustainable development.

  The UK Government, in partnership with the Scottish Executive, Welsh Assembly Government and the Northern Ireland Administration, will soon be consulting to develop a new strategy for the UK to provide a strong basis for renewed action to deliver sustainable development.

  The report will be placed in the Libraries of both Houses, and is also available on the UK Government's sustainable development website.

CABINET OFFICE

  Referendum Guidance
  The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Mr. Douglas Alexander)
  The Government have today published guidance to civil servants and NDPB Board members and staff on their role and conduct during the referendum campaigns for elected regional assemblies and the accompanying referendums on local government structures.

  The Government believe that people who serve in public life as members of public bodies should not be precluded from taking part in the referendum campaigns—whether for a yes or no vote—in their capacity as private citizens. However, where they decide to participate in such activity they should do so in accordance with the requirements of this guidance.

  Copies of the guidance have been placed in the Libraries of the House.

EDUCATION AND SKILLS

  Degree Awarding Powers and University Title Criteria
  The Minister for Lifelong Learning, Further and Higher Education (Alan Johnson)
  I am today publishing the results of the consultation on proposed new criteria for degree awarding powers and university title, which ended on 12 December 2003. The consultation followed a commitment in the White Paper "The Future of Higher Education" to modernise the criteria governing the granting of degree awarding powers (DAP) and to allow university title (UT) to be granted on the basis of taught DAP and student numbers.

  There were mixed views on the proposal to allow teaching-focused universities, with universities generally opposed and other higher education institutions (HEIs) in support. Most respondents felt the proposed criteria for taught DAP were both clearer than the current criteria and strengthen the requirements staff have to meet. Most universities supported retaining the current student number criterion for UT with other HEIs divided on whether the level should be maintained or lowered. More respondents than not were in favour of allowing specialist institutions to be eligible for UT.

  The proposal for DAP in future to be granted for six year terms, renewable subject to a satisfactory audit was opposed by most respondents. Two-thirds of universities and virtually all other HEIs expressing an opinion were against the proposal. The Standing Committee of Principals cited legal difficulties with the proposed changes. In light of these concerns, we will issue a discussion paper on renewable DAP shortly. We want to balance the concerns expressed with the Government's desire to ensure that the quality and reputation of higher education in England and Wales is maintained. The moratorium on new applications for degree awarding powers will remain in place whilst this matter is discussed further with the higher education sector and others. In the meantime, the moratorium on new applications for university title under the current criteria is lifted.

  The consultation report has been placed in the Libraries of both Houses and is available on the Department for Education and Skills website at:

  www.dfes.gov.uk/consultations/comResults.cfm? consultationld=1226.

  School Teachers Review Body Recommendations
  The Secretary of State for Education and Skills (Mr. Charles Clarke)
  The second part of the thirteenth report of the School Teachers' Review Body is being published today. It covers all matters related to the Rewards and Incentives Agreement and a range of residual matters not covered in the first part published in November 2003. Copies are available in the Vote Office and the Library of the House of Lords and at http://www.teachernet.gov.uk/management/payand performance/pay/2004/STRBreportMarch2004.

  In making their recommendations, the Review Body were required to have regard to the matters set out in the remit letters of 1 August 2002, 11 July 2003 and 9 January 2004. The STRB report deals with a wide range of weighty and complex issues and I particularly want to thank them for the exemplary way they have responded to the additional remit on issues related to the

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  upper pay scale. I remain indebted to both the Review Body and the other partners for the continued dedication and professionalism that they bring to this process. The STRB recommendations are set out below followed in each case by my response.

  I am seeking consultation comments on the report and my response by 16 April 2004.

  Upper Pay Scale

  The STRB have recommended the following:
  The content of Annexes A and B need to be reflected in pay legislation;
  Annexes A and B are further clarified, strengthened and communicated in the way set out above;
  The upper pay scale should now cease at UPS3;

  (a) that a new excellent teacher scheme is established;

  (b) that the scheme should be open only to classroom teachers who have reached UPS3 and who demonstrate that they have distinguished themselves at that level;

  (c) that the period before a UPS3 teacher become eligible to attain the status of an excellent teacher should normally be three years and that the first awards under the scheme should be made in September 2007;

  (d) that the scheme as developed should take into account the following considerations:

  it should include a process for application and assessment as rigorous as the AST process, using the same concepts of national criteria and a national assessment model;
  it should include an element of external assessment;
  the criteria should ensure that only the very best teachers can achieve the new status provided by the scheme and should include a programme of study leading to an appropriate qualification;
  the salary should reflect the quality of improvement in teaching and learning intended to result from the scheme.

  I welcome the positive and helpful way the STRB have responded to the issues around the upper pay scale. The depth of their response indicates the seriousness with which they undertook this additional remit and I am grateful for this thoroughness.

  The Rewards and Incentives Agreement I signed with our pay partners on 9 January affirmed two important principles. The first was that good classroom teachers should be able to aspire to a salary which reflects their important achievements in raising standards. The second was that the highest rewards for classroom teachers should be awarded for excellence.

  I am particularly pleased that, through their recommendations that the upper pay scale should cease at UPS3 and that a new excellent teacher scheme be established, the STRB too recognise the importance of these principles, I therefore endorse these two proposals.

  The STRB has made further recommendations concerning amplifying and clarifying the criteria for progression on the upper pay scale and putting them in the Pay Document; and further defining the detail of an excellent teacher scheme. I would welcome comments from all statutory consultees on these additional proposals.

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  Main Pay Scale and Threshold Assessment

  The STRB recommend the following:
  (a) on the basis of a teacher's performance and professional development over the past year the head teacher should decide and record in writing whether or not he or she has achieved at least the standard required to merit an increment on the main scale;
  (b) where performance is judged to be outstanding and continues at that level for two years it should merit a double increment;
  (c) where performance falls below the standard required, the increment should be deferred and an improvement plan should be put in place, with the appropriate support. The decision to defer should be reviewed in mid-year after which the increment would he backdated to the previous September, provided that the necessary progress had been made. A continuing unsatisfactory performance would result in the withholding of the increment.
  During discussions on ways of ensuring appropriate rigour in performance management and related pay decisions, the parties give careful consideration to the development of a common system, building on the practices which already exist and taking into account the model employed in certain schools.

  I am pleased that the STRB share my strong belief that,
  a rigorous performance management system, robustly applied by school leaders should be the hub of all progression.
  I further share their concerns that heads have difficulty distinguishing between the performance of individual teachers and agree that a more explicit linkage between performance, professional development and progression might go some way to address this issue. These STRB recommendations are a helpful step forward and I propose to press ahead with proposals to ensure that progression on the main pay scale is treated in this way from September 2005.

  I too believe that these decisions about pay progression can best be made within a consistent framework for performance management in schools. Part of the rationale for my proposal, put forward jointly with the co-signatories to the Rewards and Incentives Agreement was the need to encourage fair and objective decisions on pay progression. I therefore also endorse the STRB's recommendation to consider carefully with parties the need to develop a common system.

  Threshold Assessment

  The STRB recommend the following: that, over the next 18 months:
  (a) the Department and, where appropriate, the Welsh Assembly Government, take action to ensure that:

  a. all heads have received appropriate training on linking pay and performance; and

  b. a satisfactory appeal route for disputes over pay decisions, which includes an independent element,

  (b) the Department and, where appropriate, the Welsh Assembly Government, work with the statutory consultees:

  a. to maintain existing standards of decision-making on threshold applications; and

  b. to establish a quality assurance system as envisaged in paragraph 12 of the joint proposal.

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  from September 2005, threshold assessments are made at school level in the context of the school's developed performance management system; and external validation of the threshold assessment decisions of the teacher is discontinued.
  The STRB have made a number of strong recommendations about the future of threshold assessment arrangements, which I accept in principle. I note the STRB cites evidence from the PwC study, which shows that threshold assessment has largely bedded in and the important role external assessment is likely to have played in that process. I welcome their statement that subject to improvements to the performance management system and the maintenance of threshold standards, they,
  "see no absolute need to retain the external assessment system."

  I too am keen to ensure that we continue to maintain appropriate mechanisms for ensuring continued fairness and equity in threshold decisions and I am grateful for the Review Body's suggestions for securing that this is the case. As recommended by the STRB I propose to consult on the arrangements for the light touch validation of performance management systems and the best way to maintain threshold standards. As teacher appraisal is devolved, proposals regarding performance management systems in Wales are a matter for the Welsh Assembly Government. On the narrow issue of the timing of the ending of the current threshold assessment scheme, I can see considerable gains—including significant financial savings—from maintaining the end date of August 2004, but would welcome views from all statutory consultees.

  I am pleased to endorse the STRB recommendation that heads should be trained on linking pay to performance. Work is already in hand to expand the existing range of flexible training materials for head teachers and governors to include a further element focusing on the links between performance and pay decisions. The recommendations of the Review Body are helpful to the development of this package which we hope to progress with the help of the other pay partners.

  Local Approaches to Pay

  The STRB have recommended the following (in bold):

  The parties consider the proposal we have described and present us with their evidence and views by September 2004.

  I welcome the rigorous and methodical way the STRB have approached the issues around local and regional pay. They have clearly set out a range of difficult issues which need to be looked at when considering how best one should tackle any residual barriers to recruitment and retention that may still exist within our current pay system of geographical banding. Whilst noting the importance of each school tackling any other barriers to their success—including clear leadership and management structures, appropriate and available CPD and other measures designed to promote a positive environment for staff—they have offered interesting proposals for resolving many of those hard core recruitment and retention issues which might remain.

  I welcome the STRB's recommendation to consult with other parties on this proposal and provide evidence from the Department by September.

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  Additionally, I am clear that the implications of this proposal will need to be considered alongside recommendations forthcoming from the Adrian Smith review on mathematics post 14 where, here too, there were interesting proposals about how to tackle subject recruitment difficulties in specific schools and areas.

  Teachers' Pay System and Career Structure

  The STRB have recommended the following:
  the AST spine is reduced to 18 points with values parallel to points 1 to 18 of the leadership group spine not later than September 2006;
  clear record is made of their annual review and subsequent decision on salary progression.

  I welcome the STRB's recognition of the importance and distinctiveness of the AST role. L
  Leading excellent curriculum and teaching practice in schools and institutions beyond their own school…'

  I agree that we must ensure that they are afforded the necessary status within the school structure as befits the very important role they play in so many schools. Therefore, I endorse their recommendation to reduce the AST spine to 18 points with values equivalent to the first 18 points of the leadership group spine.

  Furthermore I believe, all teachers, irrespective of their role, should expect to have clear records from their annual review which would set out amongst other important issues such as objectives and professional development needs, any decisions made about salary progression. I therefore also endorse the STRB's proposals that ASTs be entitled to a clear record of their annual review and any subsequent pay decision.

  I am grateful to the STRB for their consideration of the issues regarding Chartered London Teacher Status and I propose that an appropriate amendment is made to the STPCD in September 2004 to cover this.

  Special Pay Arrangements

  The STRB have recommended the following:

  LEAs review their procedures during 2004 to ensure that unattached teachers are not at a disadvantage compared to attached teachers, and the National Employers' Organisation oversees the review and published the results so that they are available to the ether parties.

  the Department sets up a comprehensive database on unattached teachers, covering numbers, location and roles.

  the Department draws up guidance, in consultation with the interested parties, including BATOD, on how the payment of SEN allowance 2 might take account of the enhancement of the teaching of SEN children brought about by such specialist qualifications.

  the safeguarding of the social priority allowance and the inner London area supplement is removed with effect from 1 September 2004.

  the Department considers the following navigation aids when revising the Document:
  Adding a comprehensive index, with cross-references to other useful linked documents such as explanatory notes for heads, governors and LEAs and model school teachers pay policy;

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  Including a 3–4 summary at the beginning describing the teachers' career options and pay system using diagrams or; and
  Consulting on areas for pay simplification, including the balance between guidance and formal provisions.
  We also recommend the provision of more training for governors in the understanding of the teachers' pay system, the navigation around the document and its use in considering the school pay policy
  I am grateful to the STRB for their consideration of a range of further issues around the smooth and appropriate operation of the structures of the teacher's pay system.

  The STRB is right to draw our attention to concerns about the position of unattached teachers. I too think it is important for all teachers, whether they are attached to a school or not, to be treated fairly and equitably and I welcome their recommendations.

  I support the idea of a review of LEA procedures related to unattached teachers and I look to NEOST to take this forward as they see fit. On the further recommendation about the establishment of a comprehensive database on unattached teachers, it would not be practicable, for a number of reasons, to seek to develop a new database at this point. The best mechanism for delivering this will be through the adult common basic data set, which, from 2006, I anticipate being the key and most comprehensive source for information about the school workforce, including unattached teachers. I therefore accept this recommendation in the context of the developments on the adult common basic data set.

  I am content to discuss with relevant parties how the payment of SEN allowance 2 might take into account of the enhancement of the teaching of SEN children brought about by specialist qualifications. The outcome of this exercise should be without prejudice to consideration of the wider allowance framework.

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  I appreciate the attention given by the STRB to the matter of safeguarding, particularly their exposition of the balance needed between the need to protect teachers salary and the potentially inhibitory effect safeguarding can have on necessary and desirable changes in school organisation. They remind us that their thinking on both management allowances and recruitment and retention allowances in part one to this report took into account their desire to avoid long term payments of increasing value for purposes which might no longer apply. I welcome their recognition that paragraph 48 to the STPCD contains sufficient flexibility to render the need to offer separate specific payments for both social priority allowance and the Inner London area supplement unnecessary. I hope this will be a welcome flexibility and simplification for schools. I am also grateful for their steer on the issues they believe should be discussed in our conversations with key parties on the issue of safeguarding. I am minded therefore to press ahead with the abolition of safeguarding for both the social priority allowance and the inner London area supplement from September 2004.

  I also welcome the STRB's further comments on simplification of the existing pay system through looking at how we might better position the content of the document to make it accessible to the range of audiences that are required to use it. This is something of an iterative process for us but one which it is important that we press on with, a key part of which is making the pay system itself more streamlined. I therefore accept the STRB's recommendations around simplifying the document including the further need to consult on more substantive simplification of the pay systems. I wholeheartedly endorse the need to ensure governors are clear on the operation of the pay system and the flexibilities within it. As I have already mentioned, work has already begun on devising a toolkit for trainers on teachers' pay and pay policies, I propose that this training be disseminated to governors and head teachers together.

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

Circuses: Entertainment Licences
Lord Redesdale Lord Redesdale asked Her Majesty's Government:
Whether they will address the issue of applications for entertainment licences from circuses in the forthcoming guidance to the Licensing Act 2003; and how flexibility will be incorporated into those licences.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey): My Lords, the Licensing Act 2003 makes no provision to treat licensable activities in circuses differently from such activities in other locations. It is not possible for the guidance to amend the 2003 Act, but we have considered the views expressed to us by the circus industry, Equity and the Arts Council, to see where we can make the guidance clearer. The consultation period for the guidance is now over, and we expect to table the draft guidance before both Houses in the near future.
Lord Redesdale: My Lords, I thank the Minister for that reply. Could he say what "the near future" means as regards guidance? We discussed guidance all through the passage of the then Licensing Bill, and the guidance has been delayed somewhat for many reasons, not least of which is that it seems almost unworkable in many areas. Does the Minister not agree that if the guidance on circuses, which is inflexible in its operation, is not changed it could lead to the closing down of some circuses, because of the bureaucracy involved in a travelling circus getting a temporary licence at each location it visits?
Lord McIntosh of Haringey: My Lords, I do not know that I am prepared to define "in the near future". I am not seeking to justify a delay, but the first appointed day for the Act will be in September this year, when applications for licences can start to be submitted. The final implementation of the Bill will not be until the middle of next year, so there is not really a desperate hurry.
I do not think that circuses will be forced to close down. I agree that there are difficulties about the definition of regulated entertainment, and that there are problems where circuses have performances more than 50 times in a year or on a site used for a circus
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more than 12 times in a year. The solution for which we ought to look is for local authorities in the areas concerned to seek the premises licence, and then make the site available to all circuses that wish to perform there.
Baroness Buscombe: My Lords, will the Minister not agree that it is right that we should now be given some clear indication of when the statutory guidance will be issued? He will know that in another place the Secretary of State for Culture, Media and Sport assured honourable Members that the guidance would be forthcoming in November. On 9 December, I asked a relevant question and the noble Lord, Lord Warner, wrote to me to assure me that the guidance would shortly be forthcoming.
Is it not time for the Minister to admit that we are putting up with this extraordinary delay in the publication of the guidance because of a row? Is there not a fundamental difference in terms of policy between Ministers for the Home Office, the DCMS and the Department of Health, notwithstanding other departments, basically because of the problems of alcohol consumption and the impact that the Licensing Act has had on that?
Lord McIntosh of Haringey: No, my Lords, I do not agree. The position taken in yesterday's Written Ministerial Statement on alcohol is that of the Cabinet Office and has the agreement of all relevant government departments. There is no division on that. On whether such a division is the reason for the subject matter of the Question—circuses—I am bit surprised, as most circuses do not serve alcohol at all.
Lord Tebbit: My Lords, if the reason for the delay is not that suggested by my noble friend, will the Minister tell us what it is?
Lord McIntosh of Haringey: Yes, my Lords. As I said in my Answer to the original Question, we have been consulting on the matter. It is not easy. Circuses do not entertain with one single activity. The great joy of circuses is that the performances cover a great variety of activities. However, the latter do not fit easily into the structure of legislation.
Lord Redesdale: My Lords, would circuses actually need a licence if they did not perform any live music? If they avoided live music, the circus could take place quite happily without regulation. Is that not a bizarre aspect of the Act?
Lord McIntosh of Haringey: My Lords, I wish I could answer that simply, but I cannot. Music—incidental, live or whatever—is one of the issues, but there are also questions about whether the activities fall into the category of sports events—for example, those of trapeze artists. It sounds daft to the noble Lord, Lord Redesdale, and it sounds daft to me.

Wind Generators: Low-flying Aircraft
2.41 p.m.
Lord Tanlaw Lord Tanlaw asked Her Majesty's Government:
Whether the Ministry of Defence has issued wind generator hazard notices to the pilots of all low-flying aircraft.
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Bach): My Lords, we do not issue particular hazard notices. When the Ministry of Defence is made aware of wind generators, they are displayed on military low flying charts, as well as being incorporated into volume three, part one, of the military aeronautical planning document, in the same way as any other obstruction. The MoD takes flight safety issues very seriously. It has very rigorous training standards, which are applied to ensure that pilots fly only in situations for which they are suitably prepared.
Lord Tanlaw: My Lords, I thank the Minister for that reply, which, if I interpret it correctly, might indicate that wind turbines are not really a special danger to pilots after all. If there is no problem with radar or other electrical interference that cannot be filtered out in the cockpit, why are there still blanket planning objections by the Ministry of Defence to the establishment of both small and large wind farms? Like many people, I thought that they were part of government policy.
Does the Minister therefore agree that those objections may not be proper, but simply the result of an ongoing turf war between civil servants in Defra and the Ministry of Defence, in order to establish which department rules the countryside? If that is correct, will he ask the Prime Minister to intervene favourably on behalf of the wind farm applicants, so that his Government's commendable but highly ambitious targets for renewable energy can be met by 2010?
Lord Bach: My Lords, the Ministry of Defence, like all other government departments, supports the Government's renewable energy policy outlined in the White Paper. The department takes sustainability matters extremely seriously, but it is our duty to ensure that the defences of the United Kingdom are not jeopardised in any way. It is undisputed that wind turbines can affect radar, low flying, and communication links, so we have to ensure that wind farm developments do not impair our operational needs and safety. We do not object, as far as low flying reasons are concerned, outside the three tactical training areas. The noble Lord will know—because one of them is in the part of the country that he comes from—that we do not object outside those areas; and we do not always object even when there are applications inside those areas.
Lord Corbett of Castle Vale: My Lords, can the Minister say what contact he has had with the Defence
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Department of the Danish Government, since they have many offshore wind farms in areas over which their planes fly, as far as I know, without accident?
Lord Bach: My Lords, we are constantly in touch with the Danish Defence Department. We have taken a rather more cautious attitude than some other governments. We make no apology for that. As far as low flying is concerned, it is only in those three tactical training areas that we ever object to wind farms.
Lord Astor of Hever: My Lords, does the Minister agree that pilots must be able to train safely in low flying skills, especially as flying hours have been reduced? Should this not be an overriding factor when permission is sought for any planned wind farm?
Lord Bach: My Lords, the noble Lord is absolutely right, and I agree with him. The priority is to ensure that our pilots who are training for their vital tasks are safe. As the noble Lord will know, pilots are trained to see and avoid obstacles and other users of air space. While pre-knowledge of particular obstacles is useful in planning routes, we expect our pilots to maintain constant vigilance for previously unknown hazards.
Lord Ezra: My Lords, arising out of the Question asked by the noble Lord, Lord Tanlaw, can the Minister indicate the likely impact of MoD interventions on the achievement of the renewable energy targets?
Lord Bach: My Lords, in one word, none at all. Three words—none.
Lord Higgins: My Lords, the noble Lord has made an important statement that there is no question that wind farms affect radar. Yet under the Energy Bill, the Government are proposing to put wind farms in the middle of some shipping lanes, without having carried out any study whatever into whether ships' radar are likely to be affected. There could be disastrous consequences if they go straight into a wind farm.
Lord Bach: My Lords, I am grateful to the noble Lord for bringing that issue to my attention. If he will let me know more details about that, I will take the trouble of looking into it and writing back. Many of the objections made by the Ministry of Defence to proposed wind farms are on the basis of radar and the difficulties that there might be if wind farms are put up in certain places.
Baroness Strange: My Lords, is the Minister aware that windmills are also very dangerous to birds? Birds cannot read notices, so perhaps there is some other way that they could be alerted to the danger ahead.
Lord Bach: My Lords, I am grateful to the noble Baroness, as always. It is always the poor old MoD that is blamed when wind farms are not built in certain areas. Other equally notable institutions, many of them in the conservation field, also object to proposals for wind farms from time to time. Many pre-planning

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proposals are put to various bodies, including the MoD, by the developers. Many of them are sorted out at that stage.
Lord Dixon-Smith: My Lords, how many wind generator hazard notices have been issued? Is the noble Lord aware of any reports from air crew of adverse effects from wind farms during their training programmes?
Lord Bach: My Lords, I answered the noble Lord who asked the Question on the Order Paper that we do not issue particular hazard notices. I think the answer to the question asked by the noble Lord is none—again, none—but I will make sure that I check that out.
Lord Mackie of Benshie: My Lords, is the Minister aware that many of the residents threatened by wind farms would love the Ministry of Defence to intensify its opposition?
Lord Bach: My Lords, I am aware of that. It does not stop us supporting renewable energy, of which wind farms are an important part.
Baroness Byford: My Lords, how many objections have been raised by the MoD with regard to the siting of wind farms?
Lord Bach: My Lords, in the past two years, there have been roughly 1,000 pre-plan notifications of wind farm proposals per year. The MoD did not object to 64 per cent of those. When it got to the planning process, in 2003 the MoD objected to just four of those that went through the planning process.
Lord Redesdale: My Lords, I declare an interest, living next to Otterburn training area. Following on from the answer that the Minister gave to my noble friend, that there might be an intensification of use of those areas that do not have wind farms, does that mean that there will be more low-flying aircraft in those areas? It seems to be an unfair trade to make, not having wind farms and their associated problems, if we are going to get more low-flying aircraft.
Lord Bach: My Lords, I can answer the noble Lord by saying that there is no such intention, either in the area with which he is concerned or in the rest of the country. Our policy on low-flying aircraft is well known. It is vital that our pilots are trained in that way; I think that the House agrees with that. We must use our discretion and be careful that we do not disrupt people's lives any more than they are bound to be.
Lord Rotherwick: My Lords, on the four objections in planning, were those objections upheld in favour of the MoD, or were the applications allowed, although the MoD had objected to them?
Lord Bach: My Lords, I thought that I had done pretty well with figures in my answers, but the noble Lord has defeated me. I shall have to write to him.

Palestinian Communities Healthcare
2.50 p.m.
The Earl of Sandwich The Earl of Sandwich asked Her Majesty's Government:
Whether they propose any action to assist Palestinian communities now being cut off from health services by the new security wall and settlement enclaves.
The Lord President of the Council (Baroness Amos): My Lords, the Department for International Development funds the emergency programme of the Union of Palestinian Medical Relief Committees (UPMRC), which includes the provision of mobile clinics. UPMRC is delivering vital healthcare to many of the increasing number of people now isolated from essential services by the building of the security barrier.
The Earl of Sandwich: My Lords, I am grateful to the noble Baroness for that Answer, but does she agree that the new security wall and the settlement enclaves, which now affect more than half a million Palestinians, put together, are tantamount to a death sentence to Palestinians who suffer from life-threatening illnesses and are attempting to cross the checkpoints? Further, does she recognise that international aid workers are now regularly being held up at those checkpoints and can the Government do something to complain to the Israeli defence forces?
Baroness Amos: My Lords, the noble Earl, Lord Sandwich, will be aware that we consider the route of the separation barrier to be unlawful. We have said that of course Israel has the right to defend itself, but that the barrier will breed further Palestinian resentment. The noble Earl is quite right when he refers to some issues facing Palestinians. About 60 per cent of Palestinians are now living on less than two dollars a day up from 21 per cent in 2000. The quality of service delivery is one of the issues that has contributed to that.
My noble friend Lady Symons is here, has heard the noble Earl's point about international aid workers and, I am sure, will take it on board in her conversations with Israeli Ministers.
Baroness Northover: My Lords, does the noble Baroness agree with the House of Commons Select Committee on International Development, when it states:
"The appalling situation in the Occupied Palestinian Territories is not the result of a natural disaster; it is man-made and as such it requires a political solution"?
Does she agree that, although humanitarian assistance must continue, and while recognising the anxieties of Israel, economic leverage must now be used to persuade Israel to negotiate in good faith a two-state solution?
Baroness Amos: My Lords, the noble Baroness will know that we have been working extremely hard to achieve a two-state solution. That is why we are trying

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to deliver the road map. There are responsibilities on the Palestinians and on the Israelis in that road map. Both sides have failed to deliver. We will continue our efforts. That is vital because development will not happen until peace is secured.
Baroness Ramsay of Cartvale: My Lords, is my noble friend aware that after the completion of the northern part of the fence, only five suicide bombers emanated from that area in 2003, compared with 17 between February and December 2002? Is it therefore any wonder that in a democracy 84 per cent of the Israeli population is in favour of the wall? Is it not also true that only credible attempts by the Palestinian community to contain suicide bombers will lead to an end to the necessity for the wall?
Baroness Amos: My Lords, my noble friend is right to say that we need to work extremely hard on the security agenda. Israel needs to fulfil its road map responsibilities by freezing all settlement activity, removing settlement outposts and improving the humanitarian situation in the occupied territories. In parallel, the Palestinians must make efforts to stop violence and to degrade terrorist capability. My noble friend is right: where there is violence and terrorism, that will breed resentment on both sides.
Lord Wright of Richmond: My Lords, in the light of reports that the great Middle East initiative, on which the noble Baroness, Lady Symons, replied to a Question last week, has been withdrawn, can the Minister confirm what action the United States Government are taking to implement President Bush's undertaking in Belfast to put as much energy into the road map as the Prime Minister had put into Northern Ireland?
Baroness Amos: My Lords, the initiative has not been withdrawn. We continue, with the United States, with our efforts to secure a two-state solution and a peaceful resolution to the issue.
Lord Clarke of Hampstead: My Lords, does my noble friend agree—I am sure that the whole House would—that the time when the fence comes down will be one of rejoicing? In the mean time, does she agree that the importance of the anti-terrorist fence was adequately demonstrated on 3 December, when two suicide bombers were apprehended at the fence on their way to the Yok'ne'am High School with 10 kilograms of high explosive to blow it up? If they had not been apprehended, many of the children at that school today would probably be dead.
Does my noble friend further agree that, as a previous questioner said, the existence of the fence has brought about a reduction in the number of suicide bombers? In 2003, compared with 2004, there has been a 30 per cent reduction in the number of terrorist attacks. The number of victims killed in those attacks has fallen by 50 per cent during the past year. I am sure
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that she will agree with the Prime Minister, who said recently that terrorism is the enemy of the Palestinian people.
Baroness Amos: My Lords, I said in reply to an earlier question that the Government are absolutely clear that Israel has the right to defend itself. However, 89 per cent of the length of the security fence has been built on Palestinian land. Very little of the separation barrier follows the Green Line. As I said earlier, there is the issue of the increasing poverty of Palestinians. So we need both sides—the Palestinians and the Israelis—to fulfil their obligations under the road map. We cannot get away from that.
Lord Phillips of Sudbury: My Lords, does the Minister accept that the degradation and hopelessness of those in the occupied territories—and, indeed, in the camps—is now so utter and complete that it is inimical to hopes for a reduction in violence? The circumstances represent a breeding ground for violence, which no fence will ultimately prevent.
Baroness Amos: My Lords, I do not agree with the noble Lord. Yes, as I said earlier, 60 per cent of Palestinians are now living in extreme poverty, but we all know that the issues that lead to a proportion of people taking the terrorist route are complex and complicated. It would be wrong to make the kind of direct relationship that many people wish to make between conditions of extreme poverty and an immediate move to terrorism. Millions of people living in poverty around the world do not turn to terrorism. It would be wrong for us to make that link.
Lord Howell of Guildford: My Lords, would the noble Baroness remind us which sections of the barrier or fence have been cancelled or actually torn down—I believe that some have? At the same time, could she bring us up to date on where the unilateral plans of Israel for withdrawing from all settlements in Gaza have reached? Are they going ahead despite the lack of any negotiating channel?
Baroness Amos: My Lords, construction has been suspended in some areas and a review process is going on at the moment. If I may, I will write to the noble Lord about the detail of that once I have checked the latest up-to-date position.
Lord Rea: My Lords, I am delighted that my noble friend is still able to take DfID-related questions. Is she aware of a detailed report entitled Health and Segregation, which describes the disastrous effect of the wall on the health services of the community that it divides and skirts around? It was produced by the Health Development Information and Policy Institute, funded by DfID, along with the UPMRC—they closely collaborate—which she mentioned earlier. Can she reassure me that funding for that excellent non-governmental organisation will not be withdrawn, as

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rumoured, and given to the Palestinian Authority which, although completely broke, may not be able to spend it quite so effectively?
Baroness Amos: My Lords, we are aware of the report, although we have not studied it in detail. DfID does not fund HDIP, although we know its director well through our funding of the Union of Palestinian Medical Relief Committees. Of course, we recognise the valuable role that civil society organisations play in Palestinian development.

Zimbabwe: Assets Freeze and Travel Ban
3 p.m.
Lord Howell of Guildford Lord Howell of Guildford asked Her Majesty's Government:
What action they intend to take following the decision of the United States Department of the Treasury to designate seven Zimbabwean entities, three farms and four commercial businesses, each controlled by members of Mr Mugabe's regime, as "Specially Designated Nationals".
The Minister of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, the European Union agreed on 19 February 2004 to extend the list of those on its assets freeze and travel ban from 79 to 95 individuals. The United States assets freeze is on 77 individuals. The EU measures target individuals, not companies. The United Kingdom and other member states have taken the view that targeting companies risks harming ordinary Zimbabweans who are already suffering under the present regime.
Lord Howell of Guildford: My Lords, I am grateful to the noble Baroness for that reply. But is she aware—from her reply, I think that she is that the American approach is now to target those companies that are helping to bank roll the Mugabe regime and companies that are associated in any way with the already targeted individuals? Clearly, that greatly increases the pressure on the Mugabe regime. Now the US has added the potential penalties of up to 10 years' imprisonment or colossal fines for those companies that are involved with these unsavoury individuals. Is that not a much tougher approach than either the EU or HMG currently apply? Could we not follow the American example if we really are determined to end the suffering of the people of Zimbabwe?
Baroness Symons of Vernham Dean: My Lords, I certainly am aware of the differences, as I hope that my initial Answer indicated. There are differences in the regimes, although I would argue that in many ways the EU ban is more extensive in the number of individuals covered; for example, the head of the Electoral Commission, the head of the Media Commission and the leader of the war veterans. Those are very useful extensions made under the 19 February agreement.
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The noble Lord is right: the United States ban does extend to companies. As I have said, we do not wish to extend the EU ban in that way because to do so would hurt those very Zimbabweans who we are trying to protect in the current very difficult situation. Having looked at this, officials are of the view that there is not any hard usable evidence against the business people concerned. The question of trade sanctions doing more harm than good to those who are struck by poverty in Zimbabwe at the moment is a very compelling argument.
Lord Avebury: My Lords, are not some of these businesses wholly owned by individuals on ours and the EU's banned list, such as Zvinavashe investments, Zvinavashe transport and the farms that are mentioned? Why do not the European Union and Britain at least consider the extension of our personal ban to businesses that are wholly owned by people who are already on our list?
Baroness Symons of Vernham Dean: My Lords, they are wholly owned by individuals on our list. They are covered because the individuals on the list are, indeed, covered by our list. The noble Lord's point is answered in his question. If they are wholly owned by individuals where we have already taken sanctions against those individuals, the point is covered.
Lord Renton: My Lords, can the noble Baroness tell us what the United States Treasury will do if the Mugabe regime fails to co-operate in this matter?
Baroness Symons of Vernham: My Lords, I am sorry. I did not catch the last part of the noble Lord's question.
Lord Renton: My Lords, what will the United States Treasury do if the Mugabe regime fails to co-operate in this matter?
Baroness Symons of Vernham Dean: My Lords, I am sorry. I did not hear the point about co-operation. The sanctions that the United States is prepared to use are not available to me. Part of the problem is that the United States does have an unspecified travel ban. While its assets freeze is on 77 named individuals, the travel ban—this is another difference of which I am sure that the noble Lord, Lord Howell, is aware has not been published. The United States believes that it is more disruptive not to publish the travel ban, so that when people apply for visas they find it difficult to obtain them.
Lord Blaker: My Lords, is the noble Baroness aware that last Wednesday I referred to the speech made by the Prime Minister on 5 March when he referred to the Treaty of Westphalia, one of the principles of which is that the internal affairs of a country are for that country alone. He also said that we should not now tolerate the right of a country to oppress and brutalise its own people and that we should do all we can to spread the values of human rights, freedom and the

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rule of law. At that time, I asked whether that applied to Zimbabwe, but I received no answer. Would the noble Baroness be kind enough to give me an answer now?
Baroness Symons of Vernham Dean: My Lords, of course we are interested in the human rights issues in Zimbabwe. How many times have we discussed in your Lordships' House those very issues? We give, for example, considerable aid to Zimbabwe. Its economic position is deteriorating very rapidly. We expect that 7 million people in that country will need food aid by April of this year. The economy of Zimbabwe is shrinking faster than any other economy in the world. It is an extraordinary thing that has happened to that country. Your Lordships will have seen, as I did, the truly ghastly television programme about the youth training camps. We are concerned about those issues. We are supporting civil society where we can. We donate considerable aid, not only for food and aid, but also to help those in civil society.
Lord Acton: My Lords, are we continuing to put as much effort as possible into persuading South Africa, where the key lies, into pressurising the ZANU-PF regime?
Baroness Symons of Vernham Dean: My Lords, your Lordships will know that this is an extremely difficult question. We have put considerable effort into persuading South Africa and, in particular, President Mbeki. On a number of occasions, President Mbeki has said that he believes that the two sides in Zimbabwe can be brought together. I am bound to say that we have yet to see evidence of that. President Obasanjo has been helpful in trying to bring the two sides together and in trying to pinpoint the obligations that Zimbabwe has towards its own people.
It is enormously important that we do our utmost to internationalise the problem and not to leave it as a bilateral difficulty that plays entirely into Mr Mugabe's hands of wanting to depict this as a battle between himself and the British Government.
Earl Peel: My Lords, does the noble Baroness not agree that the dilemma now facing the England and Wales Cricket Board about whether to tour Zimbabwe is becoming intolerable? Is it not time that the Government got off the fence and made a clear, unequivocal statement to the effect that, due to the deeply unsatisfactory political situation in that country, the tour should not go ahead?
Baroness Symons of Vernham Dean: My Lords, the Government are not on the fence. If it were our decision, we would not go. That is clear. But, as always, we have said that we have no power to stop this tour. It is a matter for the ECB to reach a decision. That is its decision. I am afraid that in all these issues there are responsibilities. We all have to shoulder responsibility. It is too easy to turn aside and say, "That is nothing to do with us because we are a cricket
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association". There are responsibilities for everyone. If the noble Earl feels as passionately about it as he clearly does, I hope that he will get in touch with the cricket board and tell it what his views are, as I am perfectly prepared to say what our views are. I have been unequivocal about that.

Science
3.10 p.m.
Lord Haskelasked Her Majesty's Government:
What action they are taking additionally in National Science Week to bring science to the attention of the public.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, now in its 11th year, the National Science Week is a great success story and has done much to celebrate science and its importance to our lives. As well as providing funding to the British Association for the Advancement of Science to allow it to co-ordinate the week, the Government encourage the research councils to hold events during the week and organise events themselves, such as the meeting with the parliamentary Scientific Committee on Thursday morning, in Westminster Hall, on "The Government's Use of Science".
Lord Haskel: My Lords, I thank the Minister for that reply. Does the Minister share my concern about the declining number of people going into science and technology in recent years, together with the increasing concern about science? Does he agree with me that the almost 1,000 events being organised by the British Association and others during National Science Week is a helpful contribution towards reversing this worrying trend?
Lord Sainsbury of Turville: My Lords, I would like to join with my noble friend in congratulating the British Association for the Advancement of Science on its organisation of National Science Week. It does an amazingly good job. The fact that there are 1,000 events across the country, organised on a voluntary basis, is extremely impressive. I would, however, encourage him not to be too pessimistic about the number of young people going into science. Between 1994–95 and 2000–01 the numbers have increased. There is unfortunately a shift away from mathematics, physics and chemistry, which is worrying, but the total number has gone up. Equally, as for public opinion, the OST Wellcome Trust study, which was published in 2000, suggested that the great majority of people are very optimistic and enthusiastic about science, but concerned very specifically with particular technologies.
Lord Tanlaw: My Lords, can the Minister say how he will encourage young people to go into the space sciences—astronomy, astrophysics, astrobiology—when our subscription to the European Space Agency is very small? Will he commit himself, or commit the

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Government, to taking part in Aurora I or Aurora 2 and commit this country to 30 years of space science and exploration of our near neighbours in space?
Lord Sainsbury of Turville: My Lords, we are very keen to encourage young people to go into space science. Recent events have shown that British space science is in very good health and we are involved in some of the most exciting projects taking place in space exploration. We are enthusiastic members of ESA and we are looking very carefully at the Aurora programme, which will be the next generation of space exploration. Providing that goes along the lines which we hope it will—namely, a heavy emphasis on robotic exploration rather than man in space—we will support it strongly.
Baroness Sharples: My Lords, can the noble Lord, Lord Sainsbury, tell us if there is a shortage of teachers in these subjects?
Lord Sainsbury of Turville: My Lords, there is concern about the quality and qualifications of teachers in some of these areas which is extremely worrying. It is an issue on which we are taking action. Unless we get the qualifications of the teachers right, we will not get the inspired teaching that we need in these subjects.
Baroness Sharp of Guildford: My Lords, is the Minister aware that among those actively participating in National Science Week are the hands-on science discovery centres set up around the country? Is he also aware that many of these centres, set up with lottery funding, are now finding it very difficult to meet costs? Can he tell us what discussions he has had with his colleagues in the Department for Education and Skills and the Department for Culture, Media and Sport about this issue and what the outcome of those discussions has been?
Lord Sainsbury of Turville: My Lords, for once I can do even better. We have not only had discussions but have actually taken action. There is a scheme to help some of those millennium centres with hard cash to help them to survive over the next few years, because there are very considerable difficulties. But we are ahead of you: we have taken some action.
Lord Jenkin of Roding: My Lords, is the Minister aware that the decision of his department to establish a science in society unit within the OST is very welcome, following as it does the report of the Select Committee of this House on science in society? Can he reassure me that the next version of the research assessment exercise will give proper weight to the importance of scientists conducting a dialogue with the public? Scientists should be trained in that activity, because that is often much the best way of getting the public to feel that they are being consulted and involved in what are sometimes quite frightening scientific advances.
Lord Sainsbury of Turville: No, my Lords; I cannot give that assurance because I do not think that that is
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what we will do. The RAE has very specifically to be about scientific excellence. If we start putting in lots of other criteria, that simply muddies the water. The people who are on these committees are not there to judge scientific communication; they are there to judge scientific excellence. That is not to say that we should not give encouragement to scientists who get involved in science communication exercises with the public. Much more importantly, we take steps to have the proper public forums where these issues can be debated in front of the public, and they can see what is happening about regulation of these new technologies.

Fire and Rescue Services Bill
Brought from the Commons; read a first time, and ordered to be printed.

Business of the House: Standing Order 47
Baroness Amos: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That Standing Order 47 (No two stages of a Bill to be taken on one day) be dispensed with to allow the Consolidated Fund (No. 2) Bill to be taken through all its stages today.—(Baroness Amos.)
On Question, Motion agreed to.

Consolidated Fund (No. 2) Bill
Lord McIntosh of Haringey: My Lords. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read a second time.—(Lord McIntosh of Haringey.)
On Question, Bill read a second time; Committee negatived.
Then, Standing Order 47 having been dispensed with (pursuant to Resolution of today), Bill read a third time and passed.

European Parliamentary and Local Elections (Pilots) Bill
3.17 p.m.
The Parliamentary Under-Secretary of State, Department for Constitutional Affairs (Lord Filkin): My Lords, on behalf of my noble and learned friend Lord Falconer of Thoroton, I beg to move that the Commons amendment and reason be now considered.
Moved accordingly, and, on Question, Motion agreed to.
COMMONS AMENDMENT TO A CERTAIN LORDS AMENDMENT AND COMMONS REASON FOR DISAGREEING TO A CERTAIN OTHER LORDS AMENDMENT
[The page and line references are to HL Bill 14 as first printed for the Lords]

European Parliamentary and Local Elections (Pilots) Bill
  LORDS AMENDMENT NO. 1
  1 Clause 1, Leave out Clause 1 and insert the following new Clause—
  LORDS AMENDMENT NO. 1

    Piloting conduct at European and local elections
    (1) An election to which this section applies (a pilot election) must be held—

    (a) only by postal voting, and (for that purpose)

    (b) in accordance with provision made by the Secretary of State by order (a pilot order).

    (2) These are the elections to which this section applies—

    (a) the European Parliamentary general election of 2004 in a pilot region;

    (b) a local government election in England and Wales if the poll at such an election is combined with the poll at an election mentioned in paragraph (a).

    (3) These are the pilot regions—

    (a) North East;

    (b) East Midlands.

    (4) Postal voting is voting where no polling station is used and a person entitled to vote in person or by proxy must deliver the ballot paper by post or by such other means as is specified in a pilot order.
    (5) A pilot order—

    (a) may modify or disapply any provision made by or under a relevant enactment;

    (b) may contain such consequential, incidental, supplementary or transitional provision or savings (including provision amending, replacing, suspending or revoking provision made by or under any enactment) as the Secretary of State thinks appropriate;

    (c) may make different provision for different purposes."

    The Commons agree to this Amendment with the following Amendment—
    1A Clause 1, Line 15, at end insert—

    "(c) Yorkshire and the Humber;

    (d) North West."

    Lord Filkin: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 1A to Lords Amendment No. 1. I very much hope that I will have a similar fair wind to my noble friend Lord McIntosh.
    Let me set out in broad terms why we as a Government think and why the Commons think that this is a measure to which this House should agree.
    In short, the Government asked the Electoral Commission to give them advice—I stress the word "advice"—on which regions were suitable for undertaking pilot postal elections as part of the European elections and local government elections. It responded, as it had been asked to do, and said it thought that two regions were suitable for that and a further four regions were possible.
    The Electoral Commission also made it explicitly clear—as if it needed to do so—that it always recognised that it was open to the Government to have discussions with those regions falling into the "potential" category to see whether the reasons identified for not making a positive recommendation could be satisfactorily resolved.
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    The Government have undertaken such investigations with care, patience and thoroughness, and we are now clear that it is perfectly safe to undertake pilot elections in two further regions, and that elections can be delivered in those regions as a consequence. Furthermore—this is the nub of the issue—there are good public reasons for piloting elections in those additional regions. There are benefits to the public consequent on doing so. That is the essence of what I shall seek to set out succinctly.
    I shall give the House a little more detail. As part of the process of deciding where it was right to hold the pilot elections, we focused on the two regions where the commission had indicated that it was possible but not certain that it was good to do so: Yorkshire and Humberside and the north-west. With Yorkshire and Humberside, the questions in the commission's mind were whether there was sufficient security for elections to be carried out and, secondly, whether the electoral returning officers were enthusiastic and willing to undertake the function. We have had considerable discussions with Yorkshire and Humberside, and the regional returning officer for that area has written a letter, a copy of which is in the House. In the letter, he sets it out clearly that they have electoral administrators, have had discussions regarding anti-fraud measures and have a range of measures that they are looking to implement, including sample checks; local electoral awareness campaigns; hot contact points; regular liaison with the police; training of staff; and arrangements for the safe delivery of papers to electors in houses with multiple occupation. They believe that they have put in place adequate measures to make it safe for elections to take place in those areas.
    On the question of whether they want to do it, the position is now clear and is different from what it was, when the Electoral Commission first asked the question. The regional returning officer says clearly that,
    "the view of a significant majority of the same administrators today is that they would prefer to be allowed to proceed with arrangements for an all-postal ballot in June, than now be constrained to revert to planning for a conventional election".
    So, in Yorkshire and Humberside, the regional returning office and the electoral returning office want to be allowed to get on with the job and conduct postal ballots.
    I shall turn succinctly to the north-west. Again, the questions were about fraud, perhaps about willingness and perhaps about complexity. On safety, Sir Howard Bernstein, chief executive of Manchester City Council and the regional returning officer, said in his letter, a copy of which is also in the House:
    "We are committed to taking every possible step to preserve the integrity of the postal ballot".
    They have put in place additional vigilance, strong protocols and programmes and strong liaison with the Greater Manchester Police, which would be the lead police authority in the region. He also said:
    "I have been very impressed by the consistent and positive attitude all Local Returning Officers have shown to the proposed pilot here in the North West … The support was particularly strong from Salford and Trafford Councils which as you may know, enjoy cross-party support for the pilot initiative".

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    It is undoubtedly true that there is complexity in the north-west, given the number of elections that would take place there, but the people to whom we should listen on that matter, having put them on notice of the questions, are the regional returning officer and the electoral returning officers. They tell us that they believe that they can deliver a safe and secure election.
    Why, then, are the Government keen on four, rather than two, regions, which is what the House proposed, when it last considered the matter? There are several reasons, both of principle and practice. First, there are benefits in testing pilot postals in a diversity of situations. Like the Electoral Commission and many others, we think that there are many strong arguments for postal balloting in the future, but we must find out whether it works well and could be extended, for example, to all local government elections. As part of a proper process of testing, we must test the system in various circumstances, including areas in which there is complexity. It is all too easy just to test it in areas in which it would be simple and straightforward. We should also note that this is the last opportunity before 2009 to pilot postal ballots on this scale.
    I have a few final words on fraud, safety and security. I have taken the views and advice of the House very seriously, as I hope I always do. The issues of concern that were raised by the noble Lord, Lord Greaves, and others should be examined seriously because the integrity of the ballot, postal or not, matters. As a result, we have examined ways to prevent and detect fraud, to measure the public's protection of fraud and to assess fraud. That is part of the proper evaluation of a pilot experiment.
    We are working with the commission and with police forces generally on the prevention of fraud at national level and to raise the profile of the issue. I mentioned the work that was going on at regional level in that respect, but we will issue releases nationally and regionally that will make clear the offences that have been put into the Bill as a consequence of our deliberations, and we will encourage regional returning officers to inform administrators of the importance of local publicity. There will be security warnings on the voting literature. There are many other things that we are doing, but I will not weary the House with them.
    The detection of fraud is important for its own sake and for the evaluation of the project. There will be random inspections of security statements. ROs will use the marked register to contact electors, and they will investigate the redirection of proxy vote requests. After the pilot order has been made, all requests for redirection will need to be accompanied by a signed statement from the elector, and regional returning officers are putting in place systems to monitor the number of redirected postal votes.
    Measuring the perception of fraud also matters, and Clause 4 provides for that. On the assessment of fraud, I have said to the House that it is not just the identification of frauds that are reported that matters; we should expect the Electoral Commission to take positive steps to identify what is happening with fraud,
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    reported or not. Without second-guessing them on methods, I expect officials to do that task with energy and sophistication, in an attempt to find out what, if anything, happened on fraud and the perception of fraud.
    It is utterly legitimate for the Government and for the Commons to go for four regions, rather than two or three. The fact that the commission would have preferred three is down to a difference of judgment, and the Government are entitled to make that judgment. My second point is that we believe that the pilots can be done safely. The regional returning officers for the four regions want to do them. Next, the public want and like postal balloting, a fact that is hardly mentioned in our debates. The process will, under evaluated and monitored circumstances, give people the opportunity to undertake postal balloting in European and local elections at the same time. It is good that we are testing how that works in practice in various circumstances.
    The final point is that, if, as I expect, after we have gone through due process, we carry out pilots in the four regions, 2 million more people will vote in the elections, than would otherwise have done so if we see the increase in turnout shown in previous local postal balloting. We must wish that to happen, if we believe in democracy.
    For those reasons, the Commons and the Government think that we should pilot in the four regions. I ask the House to support the Commons in that respect.
    Moved, That the House do agree with the Commons in their Amendment No. 1A to Lords Amendment No. 1.—(Lord Filkin.)
    3.30 p.m.
    Baroness Hanham Baroness Hanham rose to move Amendment No. 1B, as an amendment to the Motion that this House do agree with the Commons in their Amendment No. 1A to Lords Amendment No. 1, leave out "agree" and insert "disagree".
    The noble Baroness said: My Lords, it will come as no surprise to the Government that we do not believe that a case has been made out for running the European elections in four regions. We have debated the matter at length in past weeks, and I have read the significant exchange that took place in another place. But I shall again give our reasons for being concerned that the Government have ignored the advice of their own body, the Electoral Commission, and are insisting on piloting in four regions rather than in the two which were recommended.
    It is hard to comprehend why the Government are so stuck on ignoring the advice they have been given. Presumably, what they should be looking to do is to extend the limited pilots already carried out in local government elections by upgrading those to the European regions on a scale sufficiently limited to ensure that a proper test can be carried out and assessed in seats where there is not only enthusiasm to extend the pilots, but also where there is experience,

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    competence and willingness to undertake the huge amount of work involved—now, it must be said, at very short notice.
    It is clear from the many discussions we have had that there are areas—the Minister touched on them—such as the security of ballot papers, the prevention of fraudulent personation, the difficulties of ensuring personal delivery to residents in houses in multiple occupation. guaranteeing the return of all ballot papers to the returning officer, the ability of the Royal Mail to handle the quantity in good time, and the need—not available to these elections—for individual registration as recommended by the Electoral Commission. These are all still unresolved.
    Indeed, the chairman of the Electoral Commission, who, to his credit, seems not to have been browbeaten by Ministers, in his latest letter to Mr Chris Leslie, the Minister in another place, dated 4 March and just before this matter was discussed last time in another place, points out that while the all-postal pilots already run in local government elections have demonstrated almost all of the problems which are likely to arise, there are risks inherent in pilots which will cover, in his words, over a third of the English electorate and that these go further than the commission thinks necessary to test issues of what are so elegantly described as "scaleability", which is the increase in the size of the electorate and electoral areas and complexity. The commission is also concerned that there is currently an absence of underlying legislative change required to address those risks.
    I have given at some length the view of the Electoral Commission because it is obvious from the way in which the letter has been written that Ministers have met the commission suggesting that its views were being misrepresented by others—presumably, the inference was that it was by us, the opposition parties—on the number of regions being proposed and that,
    "a clear statement would help to provide clarity".
    Ministers got their clear statement, which was a reiteration of the fact that the Electoral Commission had found itself able to recommend two pilot regions and that it had named the Minister went through this quite clearly—four others which were potentially suitable, but about which it could make no positive recommendation since these regions did not meet its criteria, which included the capacity and willingness of the regional returning officer and local returning officers to run such pilots.
    What has happened? Yorkshire, Humberside and the north-west are put forward by Ministers without further consultation with the Electoral Commission, which is also made clear in the letter. Head-bashing meetings have obviously taken place with the regional returning officers which have resulted, as the Minister has said—that is no surprise—in their agreeing that they could, if pressed, run all-postal ballots although they had told the Electoral Commission that they did not want to do so.
    There is obvious concern by the commission that the pilots are now ridiculously—that is my word, not the commission's—large. That is what we have been saying throughout these proceedings. How can a test of over one-third of the electorate be described as a "pilot"?
    I have recently seen the ODPM publication of the written evidence on postal voting presented to the Select Committee. It by no means backs up the enthusiastic embracing by the Government of postal votes. Within it there are a number of disturbing submissions on all-postal ballots regarding people filling in other than their own ballot papers; confusion among voters as to what to do; badly conducted elections which give skewed results; the invalidity of papers; concern of the police about personation; and a whole host of anxieties on the administrative process.
    It is a document which is well worth perusing. It, and the speeches we have heard from the noble Lord, Lord Greaves, ought to have woken up the Government to the dangers inherent in jumping too far and too fast on this concept.
    I have made it clear throughout all the stages of the Bill that we are not against extending the experiment of all-postal votes, but it must be realised that that is what it is—an experiment, and one which potentially puts at risk the validity of every person's right to vote at a polling station in secrecy and one which has a number of well documented potential problems.
    The Minister has drawn in aid an increase in turnout and that may be a justifiable goal, but it should not be achieved on the back of a dodgy system. The number of voters in a small-scale local election pilot is vastly different from the number in a whole European electoral region. The scheme may seem the same, but the increase in scale is bound to have enormous implications.
    I urge the Minister to accept that there are good, rational reasons for trying regional voting initially on a limited scale. In our view that would be the two electoral regions put forward by the Electoral Commission, which well substantiated its reasons for keeping to that number. We believe that that would be the correct thing to do. I hope that the Minister will, having had the opportunity to think closely about the concerns which have been cogently expressed, accept that view.
    Moved, as an amendment to the Motion that the House do agree with the Commons in their Amendment No. 1A to Lords Amendment No. 1, leave out "agree" and insert "disagree".—(Baroness Hanham.)
    Lord Rennard: My Lords, a number of our early debates on this subject have revolved very notably around the opinions of the Electoral Commission on this issue. Since we last considered it, the letter from the commission of 4 March has now been published on its website. It is clear from that letter that no possible interpretation could be made to show that the independent Electoral Commission supports all-postal pilots in four regions. Indeed, I believe that the cleverest lawyer in this House—and there are many of them—could not find such an interpretation. I thank

    145
    the Minister for acknowledging in his remarks today that the Government are explicitly acting against the advice of the Electoral Commission in trying to proceed with the four postal pilots.
    Accusations about selective quotations—
    Lord Filkin: My Lords, I thank the noble Lord, Lord Rennard, for courteously giving way. The commission signalled that it was open to the Government to go beyond the two pilots. The Government did so, recognising that it would not have been the commission's preference to have gone to four. I believe that the noble Lord put a more negative gloss on the matter than the facts justify.
    Lord Rennard: My Lords, I shall be very precise on this issue because I feel with some passion that it is very clear that the Electoral Commission does not support pilots in four regions. Accusations of selective misquotation abound, but three things are clear from the letter published on 4 March by the Electoral Commission. First, its view is that we do not really need further extensive piloting. The commission says that,
    "so far as all-postal elections are concerned, most of the lessons have been learned".
    Secondly, the commission says that we need more significant safeguards in our electoral process before the rollout of all-postal elections can be justified. It says that,
    "the rollout of all-postal elections needs to be underpinned by a more robust statutory framework".
    What the commission means by that has been made plain on a number of occasions; in this country, we need individual voter registration so that individuals are registered, a specimen of their signature is provided, and, if they vote by post, we can compare their signature on the witness statement accompanying the postal vote against their signature on the electoral registration, thus enabling us to be assured that there is not widespread fraud. We do not have that system in place at the moment, which is why the commission is opposed to rolling out all-postal voting on too wide a scale at present.
    Most explicitly, the commission is saying that there is no justification for all four postal pilots. Having listed some of the problems, the Electoral Commission concludes:
    "Nonetheless we welcome their use on a regional basis in order to test issues of scalability. But in our view pilots that cover over a third of the English electorate in June go further than we think necessary in order to address those issues, especially in the absence of the underlying legislative change we consider necessary".
    The killer fact is in its conclusion:
    "There is also in our view increased risk, with combined elections and in some cases new boundaries, in running on such a large scale and we are not persuaded that the risk is outweighed by what we might learn from four regional pilots as opposed to two".
    After so many debates on the subject, we still have no coherent explanation from the Government of why they moved from saying that there should be no all-postal pilots in June to saying, when they had agreed that there should be combined elections, that there
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    should be three. Then, in response to the Electoral Commission's view that only two pilots could be supported, the Government switched to saying that there should be four.
    If there were to be extensive rollout of all-postal vote elections this year, it should have been agreed prior to considering the question of combining the local and European elections in June. The combining of the elections and the fact that there may be fraud through all-postal voting, causing the result to be different in certain wards and councils, means that many people will oppose the measures. In that sense, the Government are the author of their own misfortune.
    We have heard from the Minister about the views of two of the returning officers most concerned. As he acknowledges, when the same returning officers were asked by the independent Electoral Commission, they expressed misgivings about the pilots on practical grounds, particularly in the north-west, because of widespread accusations of fraud connected with postal voting in certain parts of the region. The Minister now says that things have changed since the Electoral Commission spoke to those returning officers. However, I do not believe that things have changed; what has changed is the people speaking to those returning officers. It has now been the Labour Government speaking to the employees of Labour councils, whose leaders are terrified that, after many decades in office, they cannot persuade their voters to turn out to re-elect them, so the voting systems must be changed to suit those purposes.
    Of course, professional staff under pressure will always say that they will do their utmost to deliver in professional circumstances. However, their initial warnings about fraud and such problems, and the Electoral Commission's advice that the Government were going too far by having four postal pilots, should have been heeded. The Electoral Commission says that it was not involved in the discussions between the Government and the returning officers. Why not? Would it not have been better if the Electoral Commission had been involved in further discussions? Would that not have been a good and necessary public safeguard?
    Having four postal pilots is nothing to do with piloting and experimentation. The commission says that,
    "so far as all-postal elections are concerned, most of the lessons have been learned".
    The all-postal pilots in the four regions are to do with the fears of Labour council leaders, who are worried that, without a change in voting mechanisms, they will lose their positions of power. We would be failing in our duty if we did not ensure that proper respect was shown for the integrity of the electoral process and for proper means of advancing change, by consent wherever possible, and certainly not in the face of the Electoral Commission, which we established to help to avoid the perception that governments manipulate voting systems for their own electoral advantage.
    3.45 p.m.
    Lord Woolmer of Leeds: My Lords, I am a member of the European Union Select Committee, to which representatives from the Belgian Parliament are giving evidence today. With noble Lords' permission, I would like to slip away at some point. I apologise if I am not in the Chamber for the responses.
    I welcome the proposal to pilot postal voting for all electors, certainly in the Yorkshire and Humberside region in June. I welcome the care with which the Government have examined the problems and sought to address them. I was delighted that the regional returning officer, Paul Rogerson, wrote recently—he has been quoted by the Minister today—that a significant majority of the electoral officers in the region would prefer to be allowed to proceed with the arrangements for an all-postal ballot in June. In my experience, electoral returning officers are by nature and duty careful people. Their message is that Yorkshire and Humberside as a region can, and wants, properly to conduct postal vote elections in June.
    The aim of postal voting, after all, is to increase voter participation in our democracy and to give people a larger voice in their choice of government. I have talked to electoral office staff in the region in the past few days to find out about their mood and the practicalities. Overwhelmingly, they are enthusiastic in their desire to proceed with an all-postal vote pilot in the region in June. In any case, there will be a postal ballot in the regional referendum in October. If postal voting cannot be done now because of those problems, why can it be done in October? It would be useful to know whether the Liberal Democrats and the Conservatives would be opposed to that, too—the very same people will have to face the very same problems in October. For my part, it seems useful and sensible to conduct a pilot in June in order to learn lessons from it in time to assist in any tuning to deal with the referendum in October.
    As all noble Lords know, postal voting in local elections has resulted in turnouts of over 50 per cent. That is good for representative democracy. What does it mean in Leeds, the city that I know so well? At present, there are 522,000 electors and the average turnout in local elections is around 29 per cent—roughly 157,000 electors. In an all-postal vote, in the pilots to date, the average turnout has been around 50 per cent or perhaps slightly more. If the pilot goes ahead in June for the local and European elections, a Leeds election turnout of 50 per cent would mean more than 260,000 people voting more than 100,000 additional people in the city casting their vote. I regard that as a massive gain for democracy. Looked at from the point of view of the consumer, the user or, in this case, the voter, 100,000 Leeds citizens expressing their choice on who they want to represent them on the city authority and in Europe seems a massive gain.
    I hope that the Government's proposal is agreed today, and that the amendment is rejected.
    Lord Smith of Leigh: My Lords, I speak on behalf of the north-west but, first, I need to declare an interest
    148
    as I shall be a candidate in the local elections there in June. I listened with interest to the noble Lord. Lord Rennard, when he portrayed the Government as acting in a devious, politically motivated, manner while the Opposition were adopting the principled stand. We have to recognise that if there is political advantage for one party, the Opposition may think there are political disadvantages for themselves. I do not think they can pretend to be as innocent as they claim.
    We have evidence that postal voting causes a dramatic increase in turnouts at local elections. In fact, it is the only thing in all the experiments carried out which has actually changed the turnout in local elections. We know that turnouts are notoriously poor in European elections. In the 1990 European elections in the north-west, the turnout averaged 15 per cent, which meant that the variations were from single figures upwards. We need to do something to stimulate the idea that people should vote and participate in a democratic election. We know that the postal vote will work, and the debate is about how far we can extend that.
    What my noble friend Lord Woolmer said about Yorkshire and Humberside is true of the north-west. When the Electoral Commission went to get the original information, it did not consult widely across the region in terms of asking returning officers. I know there have now been a number of meetings in the north-west, lead by the Chief Executive of Manchester City Council, Sir Howard Bernstein. The implication that a distinguished public servant like that could be manipulated to say things that he did not believe is discreditable to the noble Lord who said it.
    I do not quite understand where the Electoral Commission is coming from. If we are to get evidence about whether postal votes work and whether they are applicable in elections other than local ones, it seems to me that the more evidence we get, the better. I can imagine, in two or three years' time when we are discussing where else we might extend the use of postal voting, noble Lords opposite might well say, "We don't have enough information. We've only had them in two areas, it's not enough". If the north-west and Yorkshire and Humberside have postal elections, it has nothing to do with the other regions. The capacity in the north-west to conduct a postal ballot does not diminish the capacity to do so in the north-east and the East Midlands.
    We approach this matter after postal voting has been successful in a number of areas, with great momentum, in local elections. My noble friend on the Front Bench mentioned two examples in Greater Manchester, including Trafford. Trafford has conducted three successful postal ballot elections. The electorate is enthusiastic about it, and would regard it as being a diminution of their right to vote if they lost the ability to do so by post. As my noble friend said, this is not a Labour Party scheme in Trafford. It has all-party support.
    Noble Lords have made a lot of the issue of fraud. If they are as concerned as they claim about its dangers in postal voting, I wonder why they think it is all right

    149
    in the north-east and East Midlands. Why is it all right to have such electoral fraud there as they claim would take place in postal ballots in Yorkshire and Humberside and the north-west? It is all right for those Geordies, they do not care. There is no logic in that.
    At the moment, most of the examples quoted about fraud in postal voting happen under the current system. The big problem with the current system is that it is perpetuated by unscrupulous members of all political parties, the reason being that postal votes are built up by members of political parties for their supporters. They do not go out and canvass a Labour person, for example, who says "I cannot get to the poll". I cannot imagine any noble Lords opposite doing that and saying "Oh yes, here's a way to get to the poll. We'll make sure you get that Labour vote". I do not think so. We build up registers of postal votes for people we have identified as our own party supporters, and try to make sure they get out and vote. That is where fraud can start to happen. If everyone has a postal vote it is not the political parties who determine postal votes, it is the electoral returning officer. Everyone has a vote, and the influence of political parties is greatly diminished.
    Lord Hoyle: My Lords, could I interrupt my noble friend? It is not only in Greater Manchester that the postal vote has proved to be successful; it has also been successful in Chorley in Lancashire, not just on one occasion but on two. If we deny the people of Chorley the chance to cast a postal vote now, they will wonder why that is happening. How can those who are doing this term themselves "democrats" when postal votes lead to a greater return?
    Lord Smith of Leigh: My Lords, I thank my noble friend for the intervention. Of course, he is right, it is not just in Greater Manchester. Saint Helens in Merseyside and other places in the north-west have tried it.
    If we pass this amendment and do not allow postal voting in the north-west, members of the electorate who have become used to participating in elections by postal vote will be denied that opportunity. To deny people the opportunity to vote is not a principle that I support.
    Baroness Hanham: My Lords, I am fascinated that the last three contributors had taken no part in this Bill until now. We had heard nothing of what they have said. We heard nothing either in Committee or on Report of the justification that they have just put forward. We are now in the last moments of this Bill, with which a few of us have been involved from the outset. I give way.
    Lord Filkin: My Lords, I am most grateful to the noble Baroness, Lady Hanham. I just wanted to check whether the noble Baroness was winding up at this point. In which case, I wonder whether the noble Baroness would do me the grace of allowing me to say
    150
    a few words in response. As a result of advancing age and being slow on my feet, I, not the noble Baroness, am quite clearly at fault.
    Baroness Hanham: My Lords, I do not want to interfere with the procedure. I can say all of that all over again. It gives me a second chance.
    Lord Filkin: My Lords, I shall not detain the noble Baroness for long. The passage of the Bill through this House has been well and thoughtfully handled. I think there have been efforts from all Benches to engage with real issues and seek to address them. On many issues, we have listened to what the House has said and have made a number of concessions. This is not one of them, and that is for no flippant reason. We believe we are perfectly reasonable to have this in four regions. We think it can be carried out securely, and that we will learn from the process of doing so. Therefore, I wanted to emphasise that there are such benefits to the public in more people voting in elections. As has clearly been indicated, it is responsible of us—and I hope that it would be, at some stage, for all parties—to allow this further pilot to proceed in the form we have proposed. I believe that is in the interests of democracy. For these reasons, I hope the noble Baroness will not be minded to press her amendment.
    Baroness Hanham: My Lords, I apologise if I nipped in before the Minister. Having said what I said, I will not refer to it again. I want to remind the House that we are talking about an experiment here, as I said in my opening remarks. We are not talking about a decision having been made for the whole country to vote on an all-postal basis, or the benefits of that. The Government want to test whether all-postal voting does have an impact. I will readily accept that the Minister has been responsive to the practical issues raised about all-postal voting during our deliberations. But these are still trials, and a trial is better done where there is an opportunity to assess it.
    The cat is out of the bag about this: the reason these four regions have been selected is that their next effort will be in October, when they will be invited to decide whether there should be regional assemblies. So this would effectively be a dry run for that. However, I do not think that that is a proper reason for the proposal. If we must have a pilot, examination and test of whether this will work, then, in all honesty, it makes sense to do it on a limited scale.
    The other three contributors, including the noble Lords, Lord Smith and Lord Woolmer, pointed to the fact that the previous pilots have gone down well. That is not the feedback we have had from the areas concerned. Clearly, other views have been presented to us.
    There are inherent problems in the process. The main rationale offered for the proposal is that it would increase turnout. None of us would disagree with that. However, there is no point in measuring increased turnout only against the standard of the convenience of the vote. People will vote if it is more convenient. However, if we are truly to increase turnout, people

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    should want to vote against the background of a manifesto and candidates whom they want to support, not because they see it as an easier way to vote.
    We must also not lose sight of the fact that the proposals distance us from the ballot box. Many people believe that their civic duty entails going to the polling station to vote; not everyone, but many people prefer to do that. We therefore believe that where a recommendation has been made and advice sought and given, that advice should not lightly be thrown in the air and ignored.
    I think that the letter from the chairman of the Electoral Commission is available on the website. I have certainly had a copy of it. It makes it very clear that the original recommendation was for two regions. The commission put forward another four, but it was not consulted on the other two which the Government finally proposed. The commission is concerned about the extension. For all those reasons, I wish to test the opinion of the House.
    4.2 p.m.
    On Question, Whether the said amendment (No. 1B) shall be agreed to?
    Their Lordships divided: Contents, 174; Not-Contents, 130.

    Division No. 2

    CONTENTS

    Addington, L.

    Home, E.

    Allenby of Megiddo, V.

    Hooper, B.

    Ampthill, L.

    Hooson, L.

    Anelay of St Johns, B.

    Howe, E.

    Armstrong of Ilminster, L.

    Howe of Idlicote, B.

    Arran, E.

    Howell of Guildford, L.

    Astor, V.

    HuntofWirrahL.

    Astor of Hever, L.

    Hylton, L.

    Attlee, E.

    Jenkin of Roding, L.

    Avebury, L.

    Jopling, L.

    Barker, B.

    Kilclooney, L.

    Beaumont of Whitley, L.

    Kimball, L.

    Biffen, L.

    King of Bridgwater, L.

    Blaker, L.

    Kingsland, L.

    Bowness, L.

    Knight of Collingtree, B.

    Bradshaw, L.

    Lamont of Lerwick, L.

    Bridge man, V.

    Lane of Horsell, L.

    Brigstocke, B.

    Lester of Herne Hill, L.

    Brooke of Sutton Mandeville, L.

    Livsey of Talgarth, L.

    Brougham and Vaux, L.

    Lucas, L.

    Buscombe, B.

    Luke, L.

    Byford, B.

    Lyell, L.

    Campbell of Alloway, L.

    McColl of Dulwich, L.

    Carlisle of Bucklow, L.

    MacGregor of Pulham Market, L

    Clement-Jones, L.

    Colville of Culross, V.

    Mackay of Clashfern, L.

    Cope of Berkeley, L.

    Mackie of Benshie, L.

    Courtown, E.

    Maclennan of Rogart, L.

    Cox, B.

    McNally, L.

    Craigavon, V.

    Maddock, B.

    Crathorne, L.

    Maginnis of Drumglass, L.

    Crickhowell, L.

    Mancroft, L.

    Dahrendorf, L.

    Mar, C

    Deedes, L.

    Mar and Kellie, E.

    Dholakia, L.

    Marsh, L.

    Dixon-Smith, L.

    Masham of Ilton, B.

    Eccles of Moulton, B.

    Methuen, L.

    Eden of Winton, L.

    Michie of Gallanach, B.

    Elton, L.

    Miller of Chilthorne Domer, B.

    Ezra, L.

    Miller of Hendon, B.

    Falkland, V.

    Molyneaux of Killead, L.

    Fearn, L.

    Monro of Langholm, L.

    Feldman, L.

    Monson, L.

    Fookes, B

    Mowbray and Stourton, L.

    Fowler, L.

    Moynihan, L.

    Freeman, L.

    Naseby, L.

    Gardner of Parkes, B.

    Newby, L.

    Geddes, L.

    Northesk, E.

    Glentoran, L.

    Northover, B.

    Goodhart, L.

    Oakeshott of Seagrove Bay, L.

    Goschen, V.

    O'Cathain, B.

    Gray of Contin, L.

    Onslow, E.

    Greaves, L.

    Palmer, L.

    Greengross, B.

    Park of Monmouth, B.

    Greenway, L.

    Peel, E.

    Griffiths of Fforestfach, L.

    Phillips of Sudbury, L.

    Hamwee, B.

    Pilkington of Oxenford, L.

    Hanham, B.

    Platt of Writtle, B.

    Hanningfield, L.

    Plumb, L.

    Harris of Richmond, B.

    Plummerof St. Marylebone, L.

    Hayhoe, L.

    Prior, L.

    Henley, L.

    Quinton, L.

    Higgins, L.

    Rawlings, B.

    Hodgson of Astley Abbotts, L.

    Razzall, L.

    162

    Reay, L.

    Smith of Clifton, L.

    Redesdale, L.

    Soulsby of Swaffham Prior, L.

    Rees, L.

    Stewartby, L.

    Rees-Mogg, L.

    Stoddart of Swindon, L.

    Renfrew of Kaimsthorn, L.

    Swinfen, L.

    Rennard, L.

    Taverne, L.

    Renton, L.

    Tebbit, L.

    Thomas of Gresford, L.

    Rodgers of Quarry Bank, L.

    Thomas of Gwydir, L.

    Roper, L. [Teller]

    Thomas of Walliswood, B.

    Rotherwick, L.

    Thomson of Monifieth, L.

    Russell, E.

    Tope, L.

    Saltoun of Abernethy, Ly.

    Tordoff, L.

    Sandberg, L.

    Trumpington, B.

    Scott of Needham Market, B.

    Ullswater, V.

    Seccombe, B.

    Vinson, L,

    Selborne, E.

    Waddington, L.

    Selsdon, L.

    Wakeham, L.

    Sharman, L.

    Wallace of Saltaire, L

    Sharp of Guildford, B.

    Walmsley, B.

    Sharples, B.

    Walpole, L.

    Shaw of Northstead, L.

    Watson of Richmond, L.

    Shutt of Greetland, L. [Teller]

    Wilcox, B.

    Skelmersdale, L.

    Windlesham, L.

    NOT-CONTENTS

    Acton, L.

    Goudie, B.

    Ahmed, L.

    Gould of Potternewton, B.

    Alli, L.

    Graham of Edmonton, L.

    Amos, B. (Lord President of the

    Gregson, L.

    Council)

    Grocott, L. [Teller]

    Andrews, B.

    Hannay of Chiswick, L.

    Ashley of Stoke, L.

    Harris of Haringey, L.

    Ashton of Upholland, B.

    Harrison, L.

    Bach, L.

    Haskel, L.

    Barnett, L.

    Haskins, L.

    Bassam of Brighton, L.

    Hayman, B.

    Bernstein of Craigweil, L.

    Hilton of Eggardon, B.

    Bhatia, L.

    Hollis of Heigham, B.

    Billingham, B.

    Howells of St. Davids, B.

    Blackstone, B.

    Howie of Troon, L.

    Bledisloe, V.

    Hoyle, L.

    Borrie, L.

    Hughes of Woodside, L.

    Boston of Faversham, L.

    Hunt of Chesterton, L.

    Brooke of Alverthorpe, L.

    Hunt of Kings Heath. L.

    Brookman, L.

    Irvine of Lairg, L.

    Brooks of Tremorfa, L.

    Jay of Paddington, B.

    Campbell-Savours, L.

    Jones, L.

    Carter, L.

    Jordan, L.

    Chandos, V.

    Kennedy ofThe Shaws, B.

    Chorley, L.

    Kirkhill, L.

    Christopher, L.

    Laming, L.

    Clark of Windermere, L.

    Layard, L.

    Clarke of Hampstead, L.

    Lea of Crondall, L.

    Clinton-Davis, L.

    Lockwood, B.

    Corbett of Castle Vale, L.

    Lofthouse of Pontefract, L.

    Crawley, B.

    McCarthy, L.

    David, B.

    Mcintosh of Haringey, L.

    Davies of Coity, L.

    Mcintosh of Hudnall. B.

    Davies of Oldham, L. [Teller]

    MacKenzie of Culkein, L.

    Dean of Thornton-le-Fylde, B.

    Mackenzie of Framwellgate, L.

    Dealing, L.

    Mason of Barnsley, L.

    Dixon, L.

    Massey of Darwen,

    Dubs, L.

    Merlyn-Rees, L.

    Elder, L.

    Mitchell, L.

    Evans of Parkside, L.

    Morris of Aberavon, L.

    Evans of Temple Guiting, L.

    Morris of Manchester, L.

    Farrington of Ribbleton, B.

    Orme, L.

    Faulkner of Worcester, L.

    Parekh, L.

    Filkin, L.

    Patel, L.

    Fitt, L.

    Patel of Blackburn, L.

    Fyfe of Fairfield, L.

    Pendry, L.

    Gale, B.

    Peston, L.

    Gibson of Market Rasen, B.

    Pitkeathley, B.

    Gilbert, L.

    Plant of Highfield, L.

    163

    Prys-Davies, L.

    Thornton, B.

    Ramsay of Cartvale, B.

    Tomlinson, L.

    Randall of St. Budeaux, L.

    Triesman, L.

    Rea, L.

    Turner of Camden, B.

    Rendell of Babergh, B.

    Walton of Detchant, L.

    Roll of Ipsden, L.

    Warner, L.

    Rooker, L.

    Warwick of Undercliffe, B.

    Sainsbury of Turville, L.

    Sawyer, L.

    Weatherill, L.

    Sheldon, L.

    Wedderburn of Charlton, L.

    Simon, V.

    Whitaker, B.

    Smith of Leigh, L.

    Whitty, L.

    Strange, B.

    Wilkins, B.

    Symons of Vernham Dean, B.

    Williams of Elvel, L.

    Temple-Morris, L.

    Woolmer of Leeds, L.

    Resolved in the affirmative, and amendment agreed to accordingly.
    Motion, as amended, agreed to.
    4.13 p.m.

  LORDS AMENDMENT
  3 Clause 2, page 2, line 14, at end insert—
  "() The pilot order must provide that—

  (a) all postal ballot papers must be accompanied by a declaration of identity, signed by the elector and by a witness, and containing in legible form the name and address of the witness;

  (b) each elector who has returned a postal ballot paper is sent an acknowledgment by the returning officer."

  The Commons disagree to this Amendment for the following Reason—
  3A Because it is not appropriate to make the requirements to which the Lords amendment relates.
  Lord Filkin: My Lords, I beg to move that the House do not insist on its Amendment No. 3 to which the Commons have disagreed for their reason numbered 3A.
  154
  In seeking to set out clearly why this is so, I can best encapsulate it by saying that if there was any evidence whatever that this measure—the first paragraph, to which I am speaking specifically were of help, we would be open-minded about it. But all the evidence, and there is plenty of it, makes it quite clear that it does not help. In fact it goes the other way.
  The evidence shows that requiring a witness to sign that an elector's signature is valid has been shown to be a barrier to voting, and it does not offer protection against fraud. I do not expect the noble Baroness to take my word for it in this respect, but I do expect her to listen seriously to the evidence that the pilot process has advanced so far. In 2003 every local authority which had also held pilots in 2002 chose to dispense with a witness requirement. They did so because experience showed that a witness requirement increased the number of rejected ballot papers, excluding those who may have difficulty finding a witness. Thus it impacts negatively on turnout.
  The evidence for that is not simply from those individual elections, but also from the report of the Electoral Commission, The shape of elections to come. It gave the example of Trafford, where five times the number of ballot papers had to be rejected when a witness requirement was included compared with when only the elector's signature was required. The Electoral Commission carefully evaluated all the evidence and has concluded that a security statement requiring the signature of an elector but not a witness is the best model. The disability charity Scope agrees with that.
  One would have expected that requiring a witness signature to an elector's signature would increase confidence in the safety and security of the ballot. That is what you would expect to happen. But the evidence from MORI, which undertook an evaluation survey of people's perceptions, found that:
  "Perhaps surprisingly, people who were in postal voting areas where a declaration of identity, witnessed or non-witnessed, was needed were far less likely to rate the process as safe than those in areas where no signed declaration was required".
  The organisation went on to say:
  "The normal declaration particularly affects perceptions of `ease of use', with 20% fewer rating postal voting as good in areas where this is in place".
  For those reasons, there is strong evidence that this is a barrier to voting and does not help those who are disabled. As I have said, the charity for the disabled, Scope, has spoken out strongly against this proposal. Scope is concerned that paragraph (a) of the amendment would create significant barriers for many voters, particularly disabled and older voters, along with those with low literacy, and will negatively affect voter participation in the June elections. Scope, which has undertaken substantial research on postal balloting, went on to say:
  "Evidence suggests that requiring a declaration of identity and a witness signature does not make the ballot significantly more secure, but it does have a dramatic impact on turnout".

  155
  In other words, it has a downward impact.
  For these reasons, the Government are clear that this proposal does not make sense, and the Electoral Commission supports that view. In short, if one wants a measure that will reduce turnout, that will increase the number of spoilt ballot papers, and that will reduce confidence in the security of the ballot, vote for the amendment because that is what it will do.
  I turn to the second issue of asking returning officers to provide acknowledgments that they have received a postal ballot. On the face of it, this may appear sensible, but what has been clearly signalled both by the Electoral Commission and by returning officers is that this would be an administrative nightmare. As well as organising the election, returning officers would have to enter a paper chase in which they would be required to send back acknowledgments as soon as they received the postal ballots, or as soon as they could manage to do so. That in itself is not simple.
  As the Electoral Commission has said,
  "the requirement to send individual acknowledgements will place a considerable burden on Returning Officers and their staff at an extremely busy time, and it would be difficult to guarantee a swift acknowledgement. Any delay in acknowledgement could generate unfounded anxiety on the part of voters; and generate further work for the Returning Officer in dealing with queries".
  Rather than creating a virtuous circle, we would have a vicious circle of complexity.
  My final point is that our initial estimate of the costs of carrying out such an acknowledgment process for little benefit that we can see would be between £2 million and £2·5 million. We cannot see that money as justified, particularly because we cannot see any benefit here.
  It is important that we have had a further chance to reflect on these issues. The Commons and the Government have done so, but the evidence could not be clearer: neither of the proposals would help the process in any way. Therefore, for the reasons I have set out, I hope that the amendment will not be pressed.
  Moved, That the House do not insist on its Amendment No. 3 to which the Commons have disagreed for their reason numbered 3A.—(Lord Filkin.)
  Lord Rennard Lord Rennard rose to move Amendment No. 3B, as an amendment to the Motion that this House do not insist on its amendment 3 to which the Commons have disagreed for their reason numbered 3A, leave out "not".
  The noble Lord said: My Lords, with great respect to the noble Lord the Minister, there is one very fundamental and major flaw in his argument about the declaration of identity. Just five days ago, your Lordships' House agreed without a murmur of protest to the Government's proposed regulations for the conduct of elections in June. Indeed, I understand there was no objection whatever in another place. Five days ago we considered the regulations for the combined elections on 10 June. Within those regulations, three pages set out, in some detail, the requirement for all postal votes that are to be applied
  156
  for to be returned with an accompanying declaration of identity, signed by a witness, to confirm that the person returning the postal vote is the person who should be returning that vote. That is the rule the Government have proposed—we have agreed and the Commons have agreed—should apply in eight, nine or 10 of the 12 regions across the United Kingdom in these elections. There was not a murmur of protest anywhere that this should continue to be the system for checking against postal vote fraud.
  The first part of my amendment therefore simply insists that the same safeguards should apply where is it even more necessary—where postal votes are delivered to every voter irrespective of whether they have requested one. Without it, it would be all too easy to scoop up the votes delivered to places such as homes in multiple occupation, where you can sign that you are the voter and then return those votes. The declaration of identity with a witness signature means that you must get somebody else with different handwriting who must sign and confirm their address to certify that you are the person entitled to return that vote. Without the system of individual voter registration I referred to earlier, I believe that this process remains an essential safeguard everywhere, not just where postal ballots have to be applied for. It is for the sake of consistency rather than for changing the rules that I advocate this system.
  It has of course been suggested that it may be harder for disabled people to get a witness signature than for non-disabled people. I do not believe that argument to have any real basis in logic. Even a disabled person living alone will surely see some other person—perhaps a carer—in the fortnight that they have to vote. If, very sadly, they do not, one wonders quite how the postal vote without a witness signature could be returned in any event.
  I have also heard it suggested that the witness signature may be another measure that undermines the secrecy of the ballot, a point about which we are generally concerned with all postal voting. Those of us familiar with the process of voting by post—indeed, I always vote by post—will know that the ballot paper itself is enclosed in a separate envelope so that nobody witnessing the voter's signature on a separate declaration of identity should actually see the ballot paper itself.
  I accept that the second part of the amendment is rather more experimental, but I find rather strange the argument in another place that we should not do this because it is experimental when the whole purpose of piloting voting systems is to experiment. Throughout all these debates there has been much speculation about the level of fraud. One way of assessing the scale of the problem is by trying to alert people when their ballot paper has been received by the returning officer. This may help to allay fears that their vote has actually been received in time. It will also arouse suspicion if someone knows that a ballot paper that they did not in fact receive and complete has been returned without their knowledge. I beg to move.
  Moved, as an amendment to the Motion that the House do not insist on its Amendment No. 3, to which the Commons have disagreed for their reason nurnbered 3A, leave out "not".—(Lord Rennard.)
  Baroness Gibson of Market Rasen: My Lords, I am speaking today on behalf of my noble friend Lord Carter, who is unable to be in the Chamber at this time. Scope has conducted research into accessible voting systems for the past 12 years, including evaluating the accessibility of 2002 and 2003 election pilot schemes on behalf of the Electoral Commission. It found that requiring voters to have their ballots witnessed by another person not only increased the likelihood of people spoiling their ballot or returning them uncompleted, but also put many disabled and older voters, who are more likely to be isolated or live alone, at a substantial disadvantage.
  Scope wishes to point out that requiring a declaration of identity and a witness signature does not make the ballot significantly more secure but does have a dramatic impact on turnout. Last year, St Edmundsbury, the only postal pilot to retain the need for a witness, had the lowest turnout of any voting pilot in England and Wales. Literally millions of voters would be adversely affected by such a requirement, including 2 million people in Britain who have visual impairments, 1.5 million people who have a learning impairment, and 24 per cent of adults who have low, lower or very low literacy levels.
  Baroness Hanham: My Lords, I rise briefly to support the amendment and to challenge, mildly, the previous speech. We are not talking here about elections across the country where an enormous number of people would be involved. We are talking about the experimentation in what we hope will be two regions but which the Government hope will be four. While I absolutely accept that there will be a significant number of people who will need help with the ballot paper, it does not by any means fall into the number that was being quoted.
  The noble Lord, Lord Rennard, made a very justifiable point. We are in danger here of running two sorts of elections from two different departments. Last week, we went through the regulations from the Office of the Deputy Prime Minister. As the noble Lord, Lord Rennard, said, a witness signature is required. We come to the matter today. A different department is involved and there is a great hue and cry about it.
  One of the aspects of the experiment ought to be to ensure we get the most secure vote. Having a witness signature to the postal vote—which, after all, is now the only method whereby these people can vote—is not beyond the bounds of possibility or credibility, and will possibly give more credibility to the vote. I therefore beg to support the amendment.
  Lord Greaves: My Lords, I held myself firmly down during the debate on the previous amendment. I had difficulty in doing so when the noble Lord, Lord Smith of Leigh, claimed to be speaking on behalf of the north-west. However, like him I should declare a
  158
  potential interest. In my case, depending on various selection processes, I may be on a ballot paper on 10 June—or whenever they are sent out if we have an all-postal vote.
  The Minister said that the witness statement was thought to be a barrier to voting and doing away with it increased ease of use. I would put it in a different way. It may be a barrier to fiddling and it may reduce the ease of fiddling. It would be interesting to know, in the pilots that have already taken place, who sent back the ballots papers that had been rejected because they did not have a witness statement accompanying them. As far as I am aware, nobody has actually done that research. It is all very well using MORI or anybody else to carry out vague opinion polls asking people general questions such as: "Did you like it?"; "Did you have a nice tea the day you voted?"; or whatever it is. However, what we actually need from these pilots is hard investigation and evidence concerning the following points. If there is a difference between the number of rejected papers without the witness and the number of rejected papers that had the witness, who were those people? Has anybody chased them up to find out why they did not send the witness statement back? This is the kind of hard research we want. It just has not been done at all. I hope that it will be done in the pilots that take place in the European and local elections this year.
  I explained in considerable detail in Grand Committee having the witness statements was extremely helpful when we felt it necessary to investigate some local elections in my own borough in Pendle. It may be that you suspect people of going around hoovering up votes and then sending them all in. If you have a witness statement accompanying them, you know by inspecting afterwards who has witnessed those votes. There is a line of inquiry. When you discover that some people have each witnessed more than 100 votes, this should lead to further lines of inquiry and to suspicions about what has happened.
  We are being asked to agree to the proposition that the necessity for a witness statement will make it more difficult for disabled people, visually impaired people and people impaired through low levels of learning or high levels of learning difficulty to complete their ballot papers. I do not buy that. If a person is capable, through whatever means, of understanding the ballot paper and the instructions that accompany it, signing the separate piece of paper, putting the ballot paper in one envelope and then putting all the paperwork in another envelope and sending it back, should we be asked to believe that that person is not capable of getting someone else to sign a separate piece of paper confirming that he or she is the person sending the ballot paper back? I respect what Scope says, but I think it is wrong.
  We all know that the demand for postal votes at the moment is heavily biased towards old people and disabled people. We have never had any serious complaints over the years that it causes them difficulties. As my noble friend said, the idea that some

  159
  people are such recluses that they never see anyone in a fortnight—although, no doubt, there are one or two people in society nowadays in that sad position—and cannot ask one person to sign a form saying that they are who they are meant to be is, quite frankly, not a serious argument.
  As to the second part of my noble friend's amendment, even if the wildest dreams of the noble Lord, Lord Woolmer, who is not in his place, and the noble Lord, Lord Smith of Leigh, come true and there are huge turnouts in the elections as a result of the postal votes, and the turnout across the north-west is more than 50 per cent, that will still mean that almost half the ballot papers sent out will be lying around somewhere during the fortnight in which they can be sent back. They will be piled up in lobbies and in hallways; they will be put on one side; they will be put out in bags for the local waste-paper collection; and they will be lying around in all kinds of other ways. It will be so easy for people to wander around, pick up ballot papers and send them back.
  The ballot papers will be a great temptation to political canvassers when they are going around, knocking on doors and talking to people. If the waste-paper collection is next to the door and the ballot papers are lying on top of it, I cannot put my hand on my heart and claim that no members of any party would ever be subject to temptation. If I could do so, I would, but I do not believe it, quite frankly.
  4.30 p.m.
  Lord Smith of Leigh: My Lords. we have seen it in Oldham.
  Lord Greaves: My Lords, we have indeed seen it in Oldham. Again, it is a pity that the noble Lord, Lord Smith of Leigh. is now interjecting from a sedentary position because we have missed his great experience over the years. It was a great pity that he could not take part in the Grand Committee, in particular, and in the other stages of the Bill. His experience would have been extremely valuable, whether it be from Oldham, Wigan or anywhere else.
  I should say to the noble Lord that there are many reports of landlords voting on behalf of tenants in Oldham. They go round, collect the rent, collect the ballot papers and send them back. The noble Lord is nodding. I would not like to say whether it is limited to one party or to two parties. I would like to say that it is perhaps a cultural issue but, whatever it is, it is highly undesirable.
  On the other hand, if votes are being stolen without the knowledge of the elector and the elector gets a letter from the town hall stating, "Your vote has been sent in", surely that is a fundamental safeguard against fraud. We are all concerned about fraud and I therefore support my noble friend's amendment.
  Lord Filkin: My Lords, I shall be brief. As to the good question of the noble Lord, Lord Rennard, about why last week that and this week this, the answer is that the declaration of identity with witness requirement is the norm for postal ballots in traditional elections. This is different because it is a pilot and we are testing out a different system in this respect. The reason that we have done so in the way proposed initially in the House, which the Commons now insist on, is because the evidence points that way.
  I would be the first to agree with the noble Lords, Lord Rennard and Lord Greaves, that if these measures—perhaps with some caution about the second one, which is expensive—appeared to address the problem, we should look at them. When I first engaged with the Bill, on first flush it appeared to be the case that a witness signature would increase security and would be beneficial. But the evidence from the Electoral Commission in that respect is that that is not so, and the evidence from Scope—a charity for the disabled which has done more research on this than anyone—is that there are significant disadvantages as a consequence. So there is no measure of hostility on this; it is merely that the evidence does not support the fact that these changes will work.
  I also agree with the noble Lord that we should be serious about the assessment of the scale of fraud, in both postal and other elections. I am four square with him on that. But I do not think that an acknowledgement is the way to achieve it. I have sought, in a condensed form, to set out the ways in which I believe that assessment should be carried out as part of the evaluation of these pilots. For those reasons, not through any sense of hostility, I do not think we would be wise to support these measures because there is no evidence that they will work.
  Lord Rennard: My Lords, I agree with the Minister that in due course it will probably be unnecessary to have these declarations of identity accompanied by a witness signature. But, until we have individual voter registration, as my noble friend Lord Greaves explained so persuasively and powerfully, the system is seen to be open to abuse and has been abused in a number of areas.
  We are experimenting now with voting mechanisms and, when we have safeguards in the vast majority of the country for everyone who applies to vote by post, it is wholly inappropriate that we should eliminate those safeguards and simply send out ballot papers, almost willy-nilly, through every letter box. That seems totally wrong.
  The arguments put forward by Scope, much as I respect it and disabled people, have effectively been countered during the debate. In my long experience of elections, these people are used to voting by post rather than going to a polling station. They seem to have no problem with the system at the moment and I do not see why they should have a problem with the system in the future. For those reasons, I should like to test the opinion of the House.
  4.38 p.m.
  On Question, Whether the said amendment (No.3B)
  Shall be agreed to?
  Their Lordshops divided: Contents, 174; Not- Contents, 126.
  Resolved in the affirmative, and amendment agreed to accordingly.
  Motion, as amended, agreed to.
  Bill returned to the Commons with reasons.

Business
Lord Grocott: My Lords, before we move to the next business, it may be helpful if I say that with the agreement of the usual channels proceedings on the Planning and Compulsory Purchase Bill will begin no less than half an hour from now, at twenty past five. If necessary, once the Northern Ireland order has been considered, I shall move that the House do adjourn during pleasure for a short time.
The reason is simple. We have no way of knowing quite how long the Northern Ireland order will take. It is sensible to have a half hour turn round when essentially the same group of noble Lords are debating the European Parliamentary and Local Elections (Pilots) Bill and the Planning and Compulsory Purchase Bill. I am sure it makes sense.

Agricultural Statistics (Northern Ireland) Order 2004
4.50 p.m.
Baroness Amos Baroness Amos rose to move, That the draft order laid before the House on 12 February be approved.
The noble Baroness said: My Lords, the purpose of the order is to replace the Agricultural Statistics (Northern Ireland) Act 1939, which is considered to be no longer fit for purpose, and thereby improve the quality of agricultural statistics on which important decisions are based.
The UK is obliged by the EU to collect data on farmers and persons dependent on farming. The 1939 Act makes provision for the statutory collection of data on crops and livestock, some of which can be accessed through administrative sources, but not for the collection of information on social aspects such as the age of farmers or whether they have any diversification enterprises.
The provisions of the order will therefore require farmers in Northern Ireland to provide a more useful range of statistical information to the Department for
164
Agriculture and Rural Development, which will be invaluable in monitoring trends within the industry during the next decade. In particular, the order specifies: what information may be demanded; the circumstances under which individual information may be disclosed; and the penalties for non-compliance or for wrongful disclosure.
I can assure your Lordships that the order places no additional burden on farmers to provide information and imposes no additional cost on them or on the state. No objections to the order were raised during the 12-week consultation period. I beg to move.
Moved, That the draft order laid before the House on 12 February be approved.—(Baroness Amos.)
Lord Glentoran: My Lords, I thank the Lord President of the Council for bringing the order to the House. First, I should declare an interest as a Northern Ireland farmer.
The order is very welcome. I understand that the Ulster Farmers' Union has welcomed it and I think that many others will. It certainly simplifies matters. It brings statistical collection from 1939 hopefully up to 2004. I am delighted to hear that there will be no increased cost.
In Northern Ireland, farming is a family business. The agriculture industry is arguably the biggest one that we have in Northern Ireland, but it is still operated on a family basis. Farms are worked by their owners and their families. The average farm used to be about 30 acres in size, but has probably increased to about 100 acres. Not so very long ago, the Ulster Farmers' Union brought a petition to Downing Street to complain about the impossibility for families to live off a farming income. Incomes fell so far in Northern Ireland during the foot and mouth and BSE outbreaks. Although they did not occur Northern Ireland, they affected the market adversely. I pay tribute to Brid Rodgers, who did a super job while she was in Stormont as the agriculture Minister during the foot and mouth crisis. For many years, the Department for Agriculture and Rural Development in Northern Ireland has been very much the friend of the farmer. Having spent a little time on the Front-Bench team of MAFF and Defra, I believe that this country has a lot to learn from the way in which agriculture has been managed in Northern Ireland. It is worth making that point on this occasion, but, overall, I welcome the order.
Baroness Harris of Richmond: My Lords, I too thank the Lord President for bringing the order before us. I echo the sentiments of the noble Lord, Lord Glentoran. It is an uncontroversial order. It would appear that extensive consultation has taken place, even to the extent of being posted on the web, on which I congratulate the Northern Ireland Office. There has been neither opposition nor amendment to the order. Therefore, we on these Benches fully support it.
Baroness Amos: My Lords, I thank the noble Lord and the noble Baroness for their comments and for

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welcoming the order. I can assure the noble Lord, Lord Glentoran, that there will be no increased cost. In fact, the number of forms that farmers have to fill out will be rationalised and the system will be simplified.
On Question, Motion agreed to.
Baroness Farrington of Ribbleton: My Lords, I beg to move that the House do now adjourn during pleasure until 5.20 p.m.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 4.55 to 5.20 p.m.]

Planning and Compulsory Purchase Bill
The Minister of State, Office of the Deputy Prime Minister (Lord Rooker): My Lords, I beg to move that the Bill be now further considered on report.
Moved, That the Bill be further considered on Report.—(Lord Rooker.)
On Question, Motion agreed to.
Clause 46 [Simplified planning zones]:
Baroness Hanham Baroness Hanham moved Amendment No. 139:
Leave out Clause 46.
The noble Baroness said: My Lords, Clause 46 amends the Town and County Planning Act's provision for simplified planning zones. According to the clause, a local authority may designate a simplified planning zone only where the need has been identified by the regional spatial strategy. Consequently, the Secretary of State will have significant power as to when and where they are established. My amendment would remove the clause from the Bill.
Business planning zones have had a chequered and unloved career. They have been widely disregarded by both the business community and local authorities, and there are considerable doubts from both as to whether the zones would actually speed up the planning process, strengthen accountability and public confidence in planning, secure development in the area where it is needed, or deliver the high-quality development that is required to meet the Government's urban renaissance programme.
These zones were introduced ostensibly to aid economic growth and were based on an assumption, which has now been exploded by the recent research carried out by Roger Tym and Partners for the Office of the Deputy Prime Minister Select Committee, that planning is bad for the economy and competitiveness. As proved, there is no evidence that planning control hinders either of these desirable outcomes, and it is critical the planning controls should not be jettisoned in a misguided attempt to promote economic growth at the expense of high standards. Against this background, it is quite unacceptable that simplified planning zones should be imposed on local authorities by regional planning bodies, particularly as it is clear
166
from all the discussions we have had that spatial strategies could include such policies as the promotion of development on large greenfield sites.
Rather than proceed further with these zones, it would be better now for them quietly to hit the dust. The fact that they have had little take-up and no friends would indicate that they are an obsolete part of the business and economic armoury and should be abandoned. I beg to move.
Baroness Hamwee: My Lords, we have added our names to this amendment and indeed I think that we led on the issue in Committee. We are in amity with the noble Baroness. We have tabled Amendments Nos. 146B and 149A in this group and those are consequential amendments.
At the previous stage of the Bill I asked two questions in connection with simplified planning zones, which I do not think were answered. I referred to the Green Paper's advocacy of business planning zones—I take it that simplified planning zones are what business planning zones become—which would avoid,
"delays [which] can prove a significant obstacle to the development of [fast-moving business]".
I also referred to research for the Select Committee indicating that it is a myth that planning is bad for competitiveness and for the economy. I ask the Minister to take the opportunity to explain what evidence there is that planning hinders competitiveness.
I also asked how simplified planning zones relate to local development orders, since, from what I have read about the proposed use of local development orders, it might well be that they would give the latitude on a local basis to achieve what the Government say is necessary and would be achieved by simplified planning zones.
I have a third question today, which I hope the Minister will be able to answer along with those two. In Committee on 2 February (at col. 475 of the Official Report) the noble Lord twice said that simplified planning zones would be "high-quality" and "high-tech. I can understand "high-tech", if that is what the regional spatial strategy or the Secretary of State identify as being the objective of any simplified planning zone, but how does a simplified planning zone guarantee high quality?
The noble Baroness, Lady Hanham, has said again today that this is not a much-loved provision. She said in Committee that the Bill had few friends and was losing them along the way. The Local Government Association is among those who doubt that simplified planning zones would speed up the process, would strengthen accountability or public confidence, secure development or deliver high quality. It points out that there is little support for them among local authorities—and they are in a position to say so—and we know that the business community does not seem to have come out in enthusiastic support, which one might have expected if it was going to be affected.

167
As the Minister was speaking in Committee, I thought that he rather backed up what the noble Baroness was saying about losing friends, because by the end of his brief he was clearly rather relieved to find the assurance that any simplified planning zones would be a long way off. He thought that that might win the Committee over. I think there is a lack of logic in that, if I may say so. Certainly, as he continued, the value of the provision seemed in his own eyes to be diminishing. We support the deletion of the clause from the Bill.
Lord Rooker: My Lords, I have never been very good at spin. There really is not the content to spin this one anyway. Nevertheless, I have to do my duty.
Clause 46 amends the provisions relating to the creation of the simplified planning zones so that they cannot be made by a planning authority unless the need for one has been identified in the regional spatial strategy, or the spatial development strategy in the case of London.
The provision enables the lifespan of a simplified planning zone to be for a period of up to 10 years, rather than restricting it to 10 years. That provision facilitates the creation of areas of high-tech businesses that will be referred to as business planning zones, as first proposed in the planning Green Paper in December 2001. Those business planning zones will provide a flexible planning regime to facilitate the rapid development of high-quality, high-tech business clusters, and encourage investment for growth and regeneration. I do not have any facts and proof to back that up, but that is clearly the aspiration.
As I said originally, we anticipate only one or two business planning zones per region, which must be identified in the regional spatial strategy. It is planned for them to have a low environmental impact. Their locations will be chosen to meet identified strategic needs, and any business planning zone schemes brought forward will be required to undergo environmental impact assessment and public consultation.
The zones are, of course, strategic tools, addressed in the first instance at the regional level. The local development orders are the local instruments, to be promoted entirely at the discretion of local planning authorities to meet a wider range of local needs. That deals with the issue of the similarity to local development orders. Business planning zones will serve a valuable and positive purpose, and should be supported. I therefore ask the noble Baroness to withdraw her amendment.
Baroness Hanham: My Lords, I have heard more enthusiastic speeches from the Minister, and have had more convincing replies. I have never really known the Minister to spin, and he certainly was not spinning today. I think that we should put him out of his misery; we should test the opinion of the House to see if we can get rid of the zones for him.
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5.29 p.m.
On Question, Whether the said amendment (No. 139) shall be agreed to?
Their Lordships divided: Contents, 169; Not-Contents, 114.

Division No. 3

CONTENTS

Addington, L.

Hayhoe, L.

Alton of Liverpool, L.

Henley, L.

Anelay of St Johns, B.

Higgins, L.

Arran, E.

Hodgson of Astley Abbotts, L.

Astor, V.

Home, E.

Astor of Hever, L.

Hooper, B.

Attlee, E.

Hooson, L.

Avebury, L.

Howe, E.

Barker, B.

Howell of Guildford, L.

Beaumont of Whitley, L.

Hunt of Wirral, L.

Biffen, L.

Jenkin of Roding, L.

Blackwell, L.

Jopling, L.

Blaker, L.

Kimball, L.

Bledisloe, V.

King of Bridgwater, L.

Bowness, L.

Knight of Collingtree, B.

Bradshaw, L.

Lane of Horsell, L.

Bridgeman. V.

Lester of Herne Hill, L.

Bridges, L.

Lindsay, E.

Brigstocke, B.

Livsey of Talgarth, L.

Brooke of Sutton Mandeville, L.

Lucas, L.

Brookeborough, V.

Luke, L.

Brougham and Vaux, L.

Lyell, L.

Buscombe, B.

McColl of Dulwich, L.

Byford, B.

MacGregor of Pulham Market,

Campbell of Alloway, L.

L.

Carlisle of Bucklow, L.

Mackay of Clashfern, L.

Chalker of Wallasey, B.

Mackie of Benshie, L.

Chester, Bp.

Maclennan of Rogart, L.

Chorley, L.

McNally, L.

Colwyn, L.

Maddock, B.

Cope of Berkeley, L. [Teller]

Mancroft, L.

Courtown, E.

Marand Kellie, E.

Cox, B.

Masham of Ilton, B.

Craig of Radley, L.

Methuen, L.

Craigavon, V.

Michie of Gallanach, B.

Crathome, L.

Miller of Chilthorne Domer, B.

Crickhowell, L.

Miller of Hendon, B.

Cumberlege, B.

Monro of Langholm, L.

Deedes, L.

Moore of Lower Marsh, L.

Dholakia, L.

Mowbray and Stourton, L.

Dixon-Smith, L.

Moynihan, L.

Dundee, E.

Naseby, L.

Eden of Winton, L.

Newby, L.

Elton. L.

Noakes, B.

Falkland, V.

Northbrook, L.

Fearn, L.

Northesk, E.

Ferrers, E.

Oakeshott of Seagrove Bay, L.

Fookes, B.

O'Cathain, B.

Forsyth of Drumlean, L.

Onslow, E.

Fowler, L.

Palmer, L.

Fraser of Carmyllie, L.

Park of Monmouth, B.

Freeman, L.

Peel, E.

Gardner of Parkes, B.

Perry of Southwark, B.

Geddes, L.

Pilkington of Oxenford, L.

Glentoran, L.

Platt of Writtle, B.

Goodhart, L.

Plumb, L.

Goschen, V.

Plummerof St. Marylebone, L.

GrayofContin, L.

Prior, L.

Greaves, L.

Quinton, L.

Griffiths of Fforestfach, L.

Rawlings, B.

Hamwee, B.

Reay, L.

Hanham, B.

Redesdale, L.

Hanningfield, L.

Rees, L.

Harris of Richmond, B.

Rees-Mogg, L.

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Renfrew of Kaimsthorn, L.

Stoddart of Swindon, L.

Rennard, L.

Swinfen, L.

Renton, L.

Taverne, L.

Rodgers of Quarry Bank. L.

Tebbit, L.

Roper, L.

Thomas of Gresford, L.

Rotherwick, L.

Thomas of Gwydir, L.

Russell, E.

Thomas of Walliswood, B.

Saltoun of Abernethy, Ly.

Thomson of Monifieth, L.

Sandberg, L.

Tope, L.

Scott of Needham Market, B.

Tordoff, L.

Seccombe, B.

Trumpington, B.

Selborne, E.

Ullswater, V.

Selsdon, L.

Vinson, L.

Sharman, L.

Waddington, L.

Sharp of Guildford. B.

Wade of Chorlton, L.

Sharples, B.

Wakeham, L.

Shaw of Northstead, L.

Walmsley, B.

Shutt of Greetland, L. [Teller]

Walpole, L.

Skelmersdale, L.

Watson of Richmond, L.

Smith of Clifton, L.

Wilcox, B.

Stewartby, L.

Windlesham, L.

NOT-CONTENTS

Acton, L.

Grocott, L. [Teller]

Ahmed, L.

Harrison, L.

Alli, L.

Haskins, L.

Amos, B. (Lord President of the Council

Hayman, B.

Hilton of Eggardon, B.

Andrews, B.

Hollis of Heigham, B.

Ashley of Stoke, L.

Howarth of Breckland, B.

Ashton of Upholland, B.

Howie of Troon, L.

Bach, L.

Hoyle, L.

Barnett, L.

Hughes of Woodside, L.

Bassam of Brighton. L.

Hunt of Chesterton, L.

Bernstein of Craigweil, L.

Hunt of Kings Heath, L.

Bhatia, L.

Irvine of Lairg, L.

Billingham, B.

Jay of Paddington, B.

Blackstone, B.

Jones, L.

Borrie, L.

Kennedy of The Shaws, B.

Bragg, L.

Kirkhill, L.

Brooke of Alverthorpe, L.

Layard, L.

Brookman, L.

Lea of Crondall, L.

Brooks of Tremorfa, L.

Lockwood, B.

Burlison, L.

Lofthouse of Pontefract, L.

Campbell-Savours, L.

McCarthy, L.

Carter, L.

McIntosh of Haringey, L.

Christopher. L.

McIntosh of Hudnall, B.

Clark of Windermere, L.

MacKenzie of Culkein, L.

Clarke of Hampstead, L.

Mackenzie of Framwellgate, L.

Clinton-Davis, L.

Marsh, L.

Corbett of Castle Vale, L.

Mason of Barnsley, L.

Crawley, B.

Massey of Darwen, B.

David, B.

Merlyn-Rees, L.

Davies of Coity, L.

Mitchell, L.

Davies of Oldham, L. [Teller]

Morris of Aberavon, L.

Dean of Thornton-le-Fylde, B.

Morris of Manchester, L.

Dearing, L.

Orme, L.

Dixon, L.

Parekh, L.

Dubs, L.

Patel, L.

Elder, L.

Patel of Blackburn, L.

Evans of Parkside, L.

Pendry, L.

Evans of Temple Guiting, L.

Peston, L.

Falconer of Thoroton, L. (Lord Chancellor)

Pitkeathley, B.

Ramsay of Cartvale, B.

Farrington of Ribbleton, B.

Randall of St. Budeaux, L.

Faulkner of Worcester, L.

Rea, L.

Filkin, L.

Rendell of Babergh, B.

Fyfe of Fairfield, L.

Rooker, L.

Gale, B.

Sainsbury of Turville, L.

Gibson of Market Rasen, B.

Sawyer, L.

Gilbert, L.

Sheldon, L.

Goldsmith, L.

Simon, V.

Goudie, B.

Smith of Leigh, L.

Gould of Potternewton, B.

Symons of Vernham Dean, B.

Graham of Edmonton, L.

Temple-Morris, L.

170

Thornton, B.

Wedderburn of Charlton, L.

Tomlinson, L.

Whitaker, B.

Triesman, L.

Whitty, L.

Turner of Camden, B.

Wilkins, B.

Warner, L.

Williams of Elvel, L.

Weatherill, L.

Woolmer of Leeds, L

Resolved in the affirmative, and amendment agreed to accordingly.
5.39 p.m.
Baroness Maddock Baroness Maddock moved Amendment No. 139A:
Before Clause 47, insert the following new clause—
"APPLICATION OF SECTION 106 OF THE PRINCIPAL ACT
The Secretary of State shall, prior to the commencement of section 47, publish additional guidance on the application of section 106 (planning obligations) of the principal Act."
The noble Baroness said: My Lords, the purpose of the amendment is to ensure that Section 106 agreements operate better than at present to produce housing and infrastructure that is needed in so many areas. I shall not rehearse in detail the arguments and fears that I and others expressed in Committee. We on these Benches believe that there is much merit in the present Section 106 system, and much to be built on. I know from consultation on planning tariffs that other people agree with us. I am grateful to the Minister for writing to us since Committee to explain how he sees the Section 106 agreements working in the mean time, before they are abolished in favour of planning tariffs.
Grouped with the amendment is Amendment No. 140, which would delete the clause that deals with planning tariffs. There has been consultation on that. I read the summary of that consultation and was really rather shocked. In 23 pages, there is absolutely no quantitative analysis of the results whatever. There are phrases such as "some consultees", "many consultees", "consultees generally" and "a number of consultees". Dare I suggest that if one were doing a project for GCSE and summarised in that way, it would be considered totally inappropriate? We were told how many people actually responded to the consultation, but I am shocked that it is on the basis of such a report that we will decide what to do on the issue.
Since the last time we met and we discussed this issue, one of the big concerns around the House was how the planning system was going to help to deliver more affordable housing. Many of us had fears. The noble Lord, Lord Best, is unable to be with us today, but he put forward graphically the situation from the point of view of housing associations. I declare an interest as the vice president of the National Housing Federation, and I am grateful to it for my briefing. I understand that since that time, the Minister and others at ODPM have met with the noble Lord, Lord Best. I look forward to hearing what the Minister says about the result of that meeting. It may be more appropriate for me to make those comments when the Minister has spoken, because I have concerns about what I think may happen.
I am concerned about this. The Bill has been through two Committee stages in the Commons, and we are now on the last day of Report; but we are still in a mess over this whole area. Kate Barker will probably announce her second report tomorrow. I wonder how we will deal with all of this. Today, I was even more horrified to read in a building magazine—though I do not believe everything that I read, and this gives the Minister an opportunity to say that it is perhaps not true—that Chancellor Gordon Brown is considering imposing a land tax on house builders in the Budget this week.
I hope that the Minister will be able to clarify exactly where we are going on the issue of affordable housing and the planning system. I think that the Minister agrees that there is much good in the Section 106 system, and I think that he will be telling us that they will be looking at how they can make it work better. I will not say any more at this point, because I hope that when he replies the Minister will clarify some of the points that I have raised. I beg to move.
5.45 p.m.
Baroness Hanham: My Lords, we have several amendments in this group, which are designed to delete all the clauses relating to these planning contributions on the grounds that all of this is becoming completely incoherent.
Since Committee stage, we have received—I certainly have, and I hope that other noble Lords have—a letter from the noble Lord, Lord Best, who apologises for not being in his place today. He spoke persuasively last time about the difficulties that could be erased if the Government persisted with their current proposals at the expense of the advantages that can be achieved through Section 106 provisions, particularly in the area of affordable housing. As laid out in his letter, which would have formed the basis of his speech, the Government have—I will be grateful if the Minister could confirm this set up a task force to consider the implications of making some changes to Section 106 provisions and to think through further the tariff systems and their implications.
I am sorry to be so conditional about this—the letter would have been more helpful if the noble Lord, Lord Best, had been able to speak to it. As I understand it, the Minister is thinking of setting up a task force of all the interested bodies to advise on these clauses. That is a strange situation. These clauses were put into the Bill at a late stage in the Commons. It was clear that they had no scrutiny there—at least no meaningful scrutiny—and they arrived here virtually untouched. As it stands, under paragraph 6 of Schedule 6, the Bill would take out the Section 106 provisions completely and just leave us with this rather odd system of tariffs.
In previous stages, the Minister has said that the Section 106 provisions would run alongside the tariff systems to start with. If the proposed omission is left in Schedule 6, we are concerned that, at some stage, it will be put into being and the Government will remove the Section 106 provisions. Our Amendment No. 148
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would delete the paragraph in Schedule 6 that refers to Section 106 not being part and parcel of the Bill, so that there is no doubt left in anyone's mind that the Section 106 provisions will remain.
We have Section 106, about which there have been some not very firm views as to why it is not working. There are clearly, as always with these things, ways in which this could be improved, but we are back to babies and bath water. It seems a great pity to ditch the Section 106 system when it is now widely perceived as being not only helpful to local authorities but also particularly to the affordable housing areas. The tariff system has been opposed all the way along the line. If this task force is to be set up, then its discussions will take place outside the time-scale of the Bill. This House would not have an opportunity to discuss anything that was decided by it.
I am being a bit hesitant, because I am waiting to see what the Minister has to say. However, that would be unacceptable, in the sense that we have been struggling for the last two stages of the progress of this Bill to sort out what these new provisions would be, how they would be implemented, how local authorities were to deal with them—which is a big area of concern—and how localised the elements in them of the cost of land would have to be.
I very much support what the noble Baroness, Lady Maddock, said. I hope that the Minister may be able to amplify a bit what the noble Lord, Lord Best, would have said. I would certainly like to hear his views on the understanding of the noble Lord, Lord Best, that a task force is being set up. I would very much like to know how these matters will be dealt with when this Bill has left this House.
Lord Rooker: My Lords, I say at the outset that this area has been complicated, and it has changed a couple of times since the planning Green Paper, when the Government rejected tariffs and went for Section 106. Later, because we had more time to deal with the Bill and more time to think about it because of coming from one Session to another, we have put what looks like tariffs back in, but not at the expense of Section 106. I want to repeat that again. We do not want to throw the baby out with the bath water. I hope to deal briefly with the central issues; it would frighten the House if I held up all my notes. I believe that I have a positive answer to the issues that have been raised.
There is a problem about why we have these clauses in the Bill. We have pursued the reform of planning obligations in recent years because there are difficulties in the current system. From my experience in planning when it was my day job, I know that performance varies around the country. Some smaller authorities do not fully exploit all the positive aspects of Section 106. Sometimes, there are legal arguments about whether an issue raised under Section 106 is directly related or ancillary to the development. Some of the issues are very narrow.
We want to capture more of the value of the details of infrastructure projects. We have been looking for easier, more transparent and faster means of doing

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that. Sometimes, more time is spent debating and discussing Section 106 than the original planning application. The present process causes problems. Therefore we have been searching for a means of reform.
There is a consensus about the need for reform. There is not a consensus about the solution. Given that there is a problem, the Government now think that they have some answers. Planning obligations affect most or all of the players in the planning process, which is why everyone has an opinion on them. It is important that the system is a good one. Business wants a system that is quick and certain, so that it knows what it will have to contribute and can get on with their developments—their prime function.
Likewise, local authorities want a system that is quick, so that they do not have to spend precious local authority resources on lengthy negotiations. Indeed, some authorities do not have the resources to spend on the negotiations, so they lose out on the benefit that Section 106 provides.
Local communities want agreements that are fair, where developers make a fair contribution in respect of the impact of new developments on the local community. As I say, there are arguments that lawyers can have about that. It is also right that the obligations are honoured and spent as intended. Local communities want to see the money properly spent. Developers want an assurance that their contributions have been properly used.
In turn, planning obligations can be a key tool in delivering sustainable communities, whether in a rundown industrial town in need of regeneration or in a growth area seeking infrastructure and services to support new housing. That infrastructure could run right across a community; it does not apply just to transport. It could include old disused railway lines, closed stations that trains still run through, education and/or health facilities. Planning obligations are a part of that, which is why reform of the current system is a priority.
Our solution is twofold. The first and most important change is that planning obligations policy will be established by local authorities up front in the plan-making process. They will need to identify the matters for which they would typically seek a contribution from developers, such as affordable housing, and, where provided in cash, how they would use such contributions. That will promote transparency for local communities and predictability for the development industry. We hope that it will encourage greater participation by the local community in making the development—whatever it may be—acceptable.
The second important part of the proposals relates to the optional planning charge. It is, optional—an alternative. We are not getting rid of the present system, although there is a technical point in the way that the Bill is drafted: Section 106 would disappear, but it would be reconstituted as an alternative in the new tariff system in the regulations. So it is not being
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abandoned. We will not be left with tariffs only. I repeat, we will not be left with tariffs only. That is exactly the opposite of our proposals.
Under the optional planning charge, the local authorities would attach a cost to the contributions that they would expect from the development which they plan in their local community. That would give developers further certainty about the extent of the contribution that they would be expected to make and could speed up the process of agreeing the development. There is no doubt that it also promotes greater transparency and openness and should reduce the number of negotiations taking place behind closed doors. We want to avoid people arguing that a council has been bribed in order to obtain planning pennission. That is the sort of thing that my constituents would have said.
Regarding an individual proposal, the developer will have a choice: to pay the charge or to negotiate a Section 106 agreement. The charge offers speed and predictability. The conventional negotiated route offers greater flexibility. There is a choice. We recognise that where developers opt for the charge, in some cases there are likely to be issues still requiring negotiation and it will be possible to have a separate agreement alongside the charge. As I said at an earlier stage, they will not have to pay for the same thing twice. It will not be possible to negotiate a charge and for the local authority then to try to obtain, under Section 106, the same thing through the other route. The developer will not pay twice for the same items, which is a principle set out in the Bill.
The negotiated system will remain in place very much as it is at present. We intend to reconstitute Section 106 in the secondary legislation; that is, the regulations. That is why Amendments Nos. 148 and 151, which aim to retain Section 106 alongside the new clauses, are unnecessary. That is the broad vision of the Government. Obviously, there are details to be worked through. I could go on, but it would take a lot longer than I think would be useful. Those are some of the issues in terms of regulations and the new advisory group that I think are helpful to the House. That should put the lid on the fact that we are serious and genuine about this.
In Committee, concern was expressed about the process of developing the system proposed by the Government. The view was that there should be full consultation, and not to have a new system rushed through Parliament without proper consideration and broad support from stakeholders. That is true. Initially, there was an intention to consult on tariffs in the Green Paper. When a change was proposed, the ODPM became involved. We looked at it. There was a policy decision not to proceed down that route. I remember telling a senior industry official that we would not slip changes in the Bill through the back door. However, a year later, because of the way the Bill changed due to changes in respect of compulsory purchase and moving into the next Session, we have sought alternatives and additions to give another tool

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to local authorities to look particularly for infrastructure products. Basically, we have had another year in which to work on it.
In addition to the consultation that we propose on the draft regulations and draft circular—which will happen because they will come back to this House—I would like to announce today that the Government are to set up a special advisory group of stakeholders to advise them on the reform of planning obligations. We are very grateful to the Royal Town Planning Institute and the other organisations that have expressed an interest in participating. Together they represent the full range of the sectors, including the Royal Town Planning Institute, the British Property Federation, the Chartered Institute of Housing, the Confederation of British Industry, the House Builders Federation, the Local Government Association, the National Housing Federation, the Royal Institution of Chartered Surveyors and Shelter.
The group will meet regularly over the next few months to work through the detail of the proposals. My right honourable friend Keith Hill, the Planning Minister, will chair those meetings where possible. The next months will be critical in developing the detail of the new system so that we can look forward to the valuable input of the special advisory group on the shape of the reforms. We shall also have its views on the draft regulations, the circular and the good practice guide.
I can go through a considerable number of reassurances. I hope that I have convinced the House that the repeal of Section 106 is necessary technically because it is moving from one part of legislation to another. It is not being abandoned; it is still there. As regards affordable housing, concern was expressed by the noble Lord, Lord Best. I understand why he cannot be here today. One of the problems of membership of this place is that of holding down a job that is not in London.
However, the noble Lord and the noble Baroness, Lady Maddock, are very positive about the consequence of the charge for the delivery of affordable housing. In particular, they were both concerned that developers would prefer to pay cash and, as a result, local authorities would obtain less affordable housing through planning obligations. I reassure the House that our objective remains the same. We are committed to the policy objectives of promoting mixed communities and the supply of affordable housing. More will be said about that tomorrow. I am certain that no one here today would remotely expect me to comment on the little bit that I might know, but I am such a small cog in the wheel that I do not know anything. It would be quite inappropriate, but it will all be good and positive news.
Our reforms of the planning obligations, including the charge, do nothing to change our objective of mixed communities and of promoting the supply of affordable housing. There have been misunderstandings regarding our proposals and, frankly, in some ways I am not surprised, simply because of the way the Bill has processed through
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Parliament. It is an object lesson. It is the first time that we have carried a major flagship Bill from one Session to another and made changes during that carry over. There have been lessons to be learned in the way that was done, particularly when you need to be able to take the outside world with you because the Bill affects thousands of people—councillors and developers—whom we need to keep on board with what we are doing.
It also looks a bit daft for a Minister to stand up and say that we are going to operate Section 106 where noble Lords can find bits of the legislation that say, "Section 106 is hereby repealed", and then I have to explain why it is repealed. But it is not. In other words, developers will not be left with only the charge. There will be planning obligations under Section 106 that are broadly the same as they are now. Therefore the package of legislation on planning obligations will give the optional charge—the optional charge—for the developer if it is wanted. It will be there as an alternative. Developers will not be required to pay twice for the same thing. That will be of benefit and hopefully help speed up the process, giving greater certainty, clarity and flexibility where required, and certainly transparency.
I hope that I have said enough to indicate that we are serious and genuine about that. There has been a misunderstanding about Section 106 disappearing, but developers will not be left only with the charge. That would be the direct opposite of what we intend.
6 p.m.
Baroness Hanham: My Lords, I am hound to say that we need to return to this aspect of Schedule 6 next time. You cannot have an absolutely categorical statement in one part of legislation which the Minister says does not mean what it says because "we are going to be doing something else and we will put that in regulations". The Minister would be very wise to accept my Amendment No. 148, which takes that out of legislation. I do not expect that to happen today because I appreciate that that would be unfair, but I think that I will return to that. If Amendment No. 148 is not agreed, then in future people will have to refer to Hansard and the regulations in order to decide whether Section 106 is running alongside the tariffs. I never look for mischief in the Minister—who does not do spin—but I see the possibility of difficulties arising if that clause is left in Schedule 6. We might want to come back to that.
The second point is that I am concerned that a task force that will now discuss a major aspect of the Bill and come to some conclusions is taking place outside this House and without this House having the opportunity to consider what those bodies come up with. Legislation is part of the responsibility of this House and therefore how it translates through ought to be part and parcel of our job. Maybe that aspect of

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the Bill can come back in an affirmative order which we can consider, but I would like the Minister to consider how we deal with that.
Lord Rooker: My Lords, I do not know the mechanics of how that will work, but what is sure is that we are not seeking to bypass this House. That will be legislation—regulation as well as guidance. I will ensure that, before the House is presented with a final decision, at least it will get a report from the special advisory group so that the House knows in advance what is happening. I do not know how long it will take—there is a time scale. It will be chaired by a Minister. It will not meet behind closed doors—one has only to look at the list of participants. I will ensure that the House is not presented with a fait accompli: that is the important point for which the noble Baroness is asking.
We have one opportunity at Third Reading to make sure that, beyond any shadow of doubt, there is clear understanding of what we propose to do in respect of Schedule 6.
Baroness Hamwee: My Lords, noting what the Minister said about the presentation of a report on unamendable regulations, could he at the next stage also explain to the House—which is perhaps the converse of the noble Baroness's point—why it is necessary to include the repeal on the basis of what he has just told the House?
Lord Rooker: My Lords, it is in my notes, but I have been too brief. In respect of the repeal, several members expressed concern in Committee at the repeal of Section 106—which is the subject of Amendments Nos. 148 and 151. The Government intend to reconstitute the existing provisions relating to planning obligations in our regulations to ensure that a negotiated route remains open to applicants. In my comments to the House in Committee, I said that the clause provides for this in regulations, "lock, stock and barrel". That is still the position. There may be some minor modifications as a result of the consultation, but we expect the broad shape to remain the same.
The reason that we are repealing Section 106 is not because we want to do away with the negotiated route. We want to retain the negotiated route. I hope that the House can see that to seek to abolish it would be completely inconsistent with the desire for choice and flexibility, which are at the heart of our proposals.
In fact, we are repealing Section 106 because to leave it would mean that a local authority could not only seek a planning contribution through the proposed new system, but also seek a quite separate one under the existing system. That is unacceptable because it could involve a developer having to negotiate twice and pay twice. That will not be allowed.
What I can say clearly, however, is that we will not commence the repeal of Section 106 until the new regulations are in place. Otherwise there would be a period when no planning obligations procedure was available at all. Since the regulations are subject to the affirmative resolution procedure, that means that this
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House would need to be satisfied with the proposed reconstitution of the negotiated route in regulations before Section 106 can be repealed.
On top of that I have also made a genuine offer, off the cuff, that we will make a report to the House before the House is presented with regulations so that there is no fait accompli.
Baroness Hanham: My Lords, I am very grateful for that assurance. Would it not be easier and more in conformity with the legislation to accept my Amendment No. 148, which preserves Section 106, and make it clear in regulations that it cannot be used as an adjunct to planning contributions? That way round you preserve the legislation and the legislative framework—you see that Section 106 stays as part of the legislation as it stands, but there is a brief explanation that they cannot be used twice. That would seem to be the obvious way, though I am sure that the Minister may not agree, but I shall return to that at Third Reading.
Baroness Maddock: My Lords, at last I am able to reply to the Minister. I am sure that the Minister is genuine in his views about how that has happened, and he understands the problems that we have raised, but he has not convinced me of the need to repeal Section 106. As the noble Baroness, Lady Hanham, said, if the Government want to achieve what the Minister just said then they do not need to repeal it. We are putting in place something rather complicated, outside the system and too late. I am grateful to the Minister for offering to make sure that we get a report from the task force. Before he said that, I was going to ask him whether he might give us the minutes of its meetings so that we could follow what was happening.
We have got this all the wrong way round. We have had the Bill, and we have had consultation. Now, we are going to have a task force. It should have been the other way round. I am worried, and I think that others are too. I can see from the body language in the Chamber that noble Lords support us. They are concerned that something will happen and that it will be difficult for us to scrutinise it as it should be scrutinised.
Much of the consultation that has already taken place supports the idea that Section 106 has worked well over the years, and people have begun to get to grips with a difficult situation. In his letter to me, the Minister said:
"Several local authorities, such as Leeds City Council, Watford Borough Council and Worcester City Council have in fact been operating a range of approaches based on formulae and standard charges in recent years within existing policy and negotiated agreements".
If they can do what the Minister wants them to do under the present system, why must we change it?
The Minister said a lot in his reply. I hope that he will give me and other Members who have taken an interest a little more detail in a letter. It would be helpful to see exactly where we are. We shall have to consider the matter carefully before the final stage,

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which is only next week. We will have all those wonderful statements from Kate Barker tomorrow. We will have to consider the matter carefully.
Lord Rooker: My Lords, I want one more shot. This is serious. I am thinking of the practicalities of what we are planning as an alternative approach. There are two ways of doing it: there is negotiated Section 106, as I shall call it, or there is the charge route that the developers had.
From the point of view of administering the system, it would be better for the planners, the developers and their advisers to have that package of alternative planning obligations consolidated into one document—the regulations—with one set of guidance relating to planning obligations, rather than, as the noble Baronesses would have it, having part of it in primary legislation because Section 106 was still in the Bill and another part in regulations. The guidance would be split between the two. With all that we are doing—lock, stock and barrel, as I said—Section 106 is not disappearing. We would effectively consolidate all planning obligations and planning gain legislation in one set of regulations covering the two different approaches and the guidance. From an administrative point of view, that would be better for planning offices, consultants, architects and planning advisers throughout the country. Rather than making them go to separate bits of legislation, we offer them one document with guidance. That is a practical solution, and it should knock on the head the idea that we are getting rid of Section 106. We are not.
Baroness Maddock: My Lords, the problem is that regulations are not amendable. That is one of the problems for those of us who have taken an interest in the issue. If there is to be genuine choice for people, why can we not have the two systems?
In his letter, the Minister said that the Government would repeal Section 106. We still doubt the wisdom of that. Local planning authorities are heavily pressed. As the Minister said, it is difficult, particularly for smaller authorities. Planning officers have begun to get to grips with Section 106. Now, they will be faced with something else.
Lord Rooker: My Lords, they will not. The noble Baroness is setting a hare running, and she is totally wrong. Negotiated planning obligations under Section 106 will not disappear. They are simply moving from primary legislation to regulations—lock, stock and barrel, as I said. My notes said that that was the case.
The same system that operates today can operate in the future. If the developer wants an alternative route and that route is supplied—a tariff based on whatever has come up; there are various things, but I will not go into them now—that is open to him. The local authorities will be able to operate the same system—the one with which the noble Baroness says they are comfortable—in the future as now. We are not changing their role. Let us not set the hare running that we are removing their choice to operate Section 106
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agreements. I do not know what we call such agreements; perhaps we ought to call them Section 106 agreements in the regulations.
On the other point, I must ask why, if we are moving the process lock, stock and barrel to regulations, does the noble Baroness want them to be amendable? She is satisfied with what is operating now, and we have just said that we will operate it through regulations—lock, stock and barrel. What is the problem? The fact that the regulations are not amendable should not be a problem. No one is seeking to change the system now, because it works well. Because it works well, we want to keep it, and we will do so in the regulations, as an alternative to the charge option. I rest my case.
6.15 p.m.
Baroness Maddock: My Lords, the point that I was making was that local authorities would have a new system as well as the kept Section 106 system in the other form that the Government want. We would not just be using the system that we have and making it better. At previous stages of the Bill's progress, the Minister said that he would improve the way that Section 106 worked. Is he now saying that he will not improve it?
We have had a long debate. I would appreciate a letter from the Minister setting out exactly how things will work and what the timetable will be. People are worried about the timetable and about when things will come into operation. In all fairness, we need to know that. At the moment, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 47 [Planning contribution]:
[Amendment No. 140 not moved.]
Clause 48 [Planning contribution: regulations]:
[Amendment No. 141 not moved.]
Clause 49 [Planning contribution: Wales]:
[Amendment No. 142 not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 142A:
Before Clause 50, insert the following new clause—
"APPEALS AGAINST PLANNING DECISIONS
(1) In section 78 of the principal Act (right of appeal against planning decisions and failure to take such decisions) after subsection (2) there are inserted the following subsections—
"(2A) Where a local planning authority approves an application for planning permission, and—

(a) the planning application does not accord with the provisions of the development plan in force in the area in which the land to which the application relates is situated; or

(b) the planning application is one in which the local authority has an interest as defined in section 316;

certain persons as specified in subsection (2B) below may by notice appeal to the Secretary of State.
(2B) Persons who may by notice appeal to the Secretary of State against the approval of planning permission in the circumstances specified in subsection
(2A) above are any persons who have lodged a formal objection to the planning application in writing to the planning authority for the area in which the land to which the application relates is situated."

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(2) Section 79 of the principal Act (determination of appeals) is amended as follows.
(3) In subsection (2). leave out "either" and after "planning authority" insert "or the applicant (where different from the appellant)".
(4) In subsection (6), at the end insert "(except for appeals as defined in section 78(2A) and where the appellant is as defined in section 78(2B))"."
The noble Baroness said: My Lords, I suppose that the amendment is something of a continuation of a theme. We persist in seeking a provision regarding third-party rights of appeal, which is the shorthand way of describing it, because we want to ensure transparency, trust and confidence in the system. In Committee, I spoke at some length to a similar but more extensive amendment, and I do not intend to go again through the reasons for our support for a third-party right of appeal.
In Committee, the Minister said that such a provision would slow down the system and would not be consistent with a democratically accountable system of planning. He relied on the increased community involvement that he anticipates with the Bill. I think that I have said that we have had a plan-led system for over a decade. Much as I hope that there will be real community involvement, we all know how difficult it is to interest citizens in what happens in their neighbourhood until there is a concrete proposal.
I raise the point again, in order to ask the very good question asked by a Member of the House of Commons, when it debated the provision: if the Government want to speed things up, have they given any thought to removing the right of appeal from an applicant, when the local authority's decision is in line with its own current plan? That question is new to this House, which is why I felt that it was worth raising the matter again. Having heard what the Government had to say about safeguards, I cannot be as enthusiastic about the effectiveness and usefulness of judicial review, given that it is somewhat cumbersome and costly, the powers of the local government ombudsman and other similar administrative arrangements.
I still feel that there are unanswered points. As the question was not asked last time, I shall ask it now. I beg to move.
Lord Chorley: My Lords, I supported third party rights of appeal at Second Reading and at Committee and accordingly I support this amendment, which I find rather easier that Section 106. The restrictions of the rights which this amendment now carries seem entirely reasonable. At earlier stages the Government seemed to have two objections, the first being delay. But is that of much weight given the limited circumstances in which it would now apply and which would trigger an appeal? Moreover, the threat of an appeal alone may well improve both the quality of the planning decision and may even bring the developer to the negotiating table. If planning is a mediating process between conflicting interests and objectives, and I am a firm believer that it is, then this is surely just one desirable aspect of the mediation process. On
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reading Hansard it seemed to me that the Minister agreed that the delay argument was not very substantial.
The second notion was that the third party right of appeal, as the noble Baroness has just said, is somehow undemocratic. To me the notion that a planning decision by an authority in its own favour should for that reason override the right of appeal, simply because the authority has been elected, is extraordinary. It boils down to a notion of democracy which has no concept of checks and balances. which surely is the hallmark of democracy.
The argument that the appellant can resort to judicial review is lacking in both common sense and reality. It is expensive and restrictive, that is to say, not always applicable. To be fair, the Minister recognises that and he does not put that forward as an argument.
There is the question, which I believe I raised originally at Second Reading, of designated areas which are planning authorities. I mentioned at that stage the case of the national parks. To argue that ministerial appointees are democratic because the Minister represents an elected government is to stretch credulity to breaking point.
What about SSSIs? The Minister made some remarks in Committee on the subject of national parks, which I found difficult to construe from reading Hansard. He said:
"At some [time] I will address the national parks issue".—[Official Report, 5/2/04; col. 814.]
After that he was rather difficult to follow so perhaps the noble Lord can help me when he replies and say how other designated areas fall into the scheme.
Lord Bridges: My Lords, I moved an amendment in rather similar terms at Committee stage, but I did not press it to a Division because of lack of support. I am very happy to see it again. Re-reading the speeches made at Committee stage, I believe that a common criticism of what I said was that planning decisions should be taken by elected councillors and that if one did not like that decision, one should kick out the councillors at the next election. I remember the noble Lord, Lord Lucas, speaking effectively in that vein.
But I do not believe that that argument is very convincing. The fact is that fewer and fewer planning decisions are now taken by meetings of the elected councillors. There are two reasons for that. One is the cabinet system which will take a political view about a particular development and will require the ruling majority to support that line in committee. Thus the cabinet effectively excludes the elected councillors meeting together on many occasions.
Secondly, there is a very tight timetable now in force for the taking of the majority of planning decisions, which are delegated to the officers. These matters come before the councillors as cooked meals: there is nothing that the councillors can do about it. I believe that a reasonable third party right of appeal is an

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essential concomitant of the excellent planning system which we have and would be a notable improvement. I hope that this proposal will now find favour.
Lord Lucas: My Lords, when these amendments came before us in Committee I was rude about them, as the noble Lord, Lord Bridges, said. I am much happier with this cut-down version. I believe that the noble Baroness, Lady Hamwee, made a good point when she referred to the possible restriction on applicants who were seeking to do something outside the plan and had been turned down because of the council getting through to the Secretary of State. I would prefer not to go down that road, but to follow the route suggested in this amendment. That would provide some degree of parity.
When we have gone through a process to agree a plan, a variation should allow for a right of appeal. As the noble Lord, Lord Bridges, said, some of the structure which has been imposed on councils recently has led to a diminution in the involvement of councillors in the democratic process in considering individual applications. I would be happy to see something of the kind referred to in the Bill. I would like to see a junk filter in there somewhere. I would like the Secretary of State to have the right to decline to consider an appeal if the matters raised were not substantial in his opinion. Otherwise, people will allege that something is outside the plan and force the department to go through some kind of process to prove the contrary. It should be restricted to significant cases. I do not have a clear idea of how that is to be done, but the amendment is heading in the right direction.
Lord Rooker: My Lords, I said at the outset that I do not believe that the issue of removing the right of appeal by the applicant was raised in earlier debates. At this point we have no plan to remove the right of appeal from applicants.
The new clause reflects the one we debated in Committee, which obviously sought to introduce the right for third parties to appeal against the grant of planning permission by the local authority in specified circumstances. But this clause envisages a more limited third party right of appeal than on the previous occasion. Therefore, I can use a long note rather than a massive one, which is what I was faced with previously.
I genuinely understand the concerns that the clause seeks to address. In her concluding remarks in a previous debate about the issue, the noble Baroness, Lady Hamwee, expressed her concern about two types of circumstances in which this amendment seeks to provide a third party right of appeal. Those circumstances are where the decision to grant planning permission is a departure from the development plan or in which the local authority itself has an interest.
We believe that the proposed measures are neither necessary nor appropriate in these limited circumstances and I shall seek to explain why. As is known, the Government acknowledge that we need greater community involvement in the planning process. If one
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takes this matter in isolation and ignores the rest of the Bill, a very powerful case would have been made, as indeed it has, by the noble Lords, Lord Chorley, Lord Lucas and Lord Bridges.
But one has to look at the rest of the changes that we are making in the Bill to the planning system, which provide opportunities for community involvement. But the Bill builds on that and strengthens those opportunities. I have set out in detail the way in which that will happen so I will not repeat it today.
The Bill will strengthen the opportunities for people to comment on and influence development proposals much earlier in the process and even before a planning application has been submitted. So we believe that it makes sense to continue with a plan-led system of development control. That is why so much of the Bill focuses on improving the processes for developing such plans. The plan provides a framework to engage people in the way in which their communities might grow and change. For businesses it provides an essential source of information about where to propose new developments and of the type likely to be appropriate. There are established, clear and strict rules and procedures to ensure the propriety of the decision-making process and the decisions taken. Therefore, the planning decision must be decided in accordance with the development plan unless material considerations indicate otherwise.
Where proposals for developments do not accord with the development plan, the Secretary of State must be notified so that he can consider whether to call in the application for his own determination. The Secretary of State does not call in every notified case because in many circumstances a decision contrary to the local plan would not conflict with national policies, have significant effects beyond their locality or give rise to substantial controversy.
I am on record as saying that the reason I wanted a third-party right of appeal, prior to becoming the Planning Minister, when I was an elected Member of the other place, is that at every occasion we sought to use it to stop a development. I wanted to use it as a veto on development—I make no bones about that. A decision to depart from the local plan may well be the appropriate one, even if it is not popular. The call-in review process is a safeguard in that respect.
The second proposal in the new clause is for a third-party right of appeal in cases involving planning applications where the local authority has an interest. There appears to be a presumption—it was not spelt out in detail, but it must be the case—that the local authority will act improperly in deciding such cases. I have set out previously the lengthy list of legal and administrative safeguards that apply in decisions in cases where local authorities have a pecuniary interest in the proposed development. The safeguards are designed to ensure that local authorities act in a fair and unbiased manner. Local authorities operate under very strict rules to deal with possible conflicts of interest. We had a list of some of them in Committee. Although they seem extreme at one end, they serve to prevent any impropriety where the local authority has an interest in an application.

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Moreover, in the event that impropriety can be shown—I realise that it does not happen often; I have given figures judicial review by the courts is available. I have demonstrated in Committee that the remedy of judicial review is actively employed by third parties, and decisions of local planning authorities have been overturned as a result. The activity is relatively low, for reasons that we understand, so we would not expect that there would be a need regularly to resort to such proceedings. Judicial review is but one of a range of powerful legal and procedural safeguards in the planning process; it is not the sole recourse in the event of an alleged impropriety in the process. We do not believe that we need to add to this armoury an appeal route to the planning inspectorate. We do not argue against doing so on the basis that it would not be useful on the very few occasions where there may have been an improper decision that should be overturned; rather, our concern is that such a provision would be used by third parties inappropriately, and all too frequently. As I said, too many proponents—I was one of them—of a third-party right of appeal want to use it to veto development, either by obtaining a different decision from the planning inspector or by a process of attrition. We do not want the planning system to be slowed down in that way—I make no bones about that.
I understand that the new clause envisages that the right of appeal would apply to anyone who had objected at the application stage. Our concern is that the provision would confuse and slow down the initial consideration of the planning application. Providing a right of appeal to anyone who had objected at an application stage is likely to encourage the submission of objections in order to safeguard the right of appeal should permission be granted at the application stage. That cannot be a desirable outcome.
We must remember that it is the responsibility of the local planning authorities to act in the public interest when determining planning applications. They must take account of the views of local people on planning matters before taking decisions. Elected members must justify their decisions to their electorate. I realise that, in that respect, it is almost a contradiction of some aspects of the examples taken. They would not take decisions affecting their ward or electorate, because sometimes they would be ruled out. However, as regards their responsibilities, not only do they represent a ward, they are local authority councillors representing the district council and are required to take an overview on certain issues, in the same way as Members of the other place are sometimes required to take a national view rather than a constituency one.
Developers need certainty in order to invest in local areas and they want decisions quickly. A third-party right of appeal would mean that planning approvals could not be implemented pending an appeal, and it would inevitably lengthen the existing decision-making process. Our proposals for greater community involvement throughout the whole planning process—that is, our new proposals in the Bill—coupled with the existing range of legal and procedural safeguards,
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including the availability of judicial review, render unnecessary the third-party right of appeal, even a limited one as set out in the clause.
For all those reasons, I do not see any merit in introducing a third-party right of appeal. I genuinely believe that, because I know from my own practical experience how I would have gone down the road of the third-party right of appeal for the reasons that I have given. I am not saying that everyone would take that approach, but the vast majority would.
I apologise for not answering the point about national parks in the previous debate, despite having said that I would. It is not an elected body; however, the organisation is supposed to work in the best interests of the area of special amenity value. We are not convinced of the need for a third-party right of appeal, even in a major case. I hope that I have made clear that I do not rest the case exclusively on the issue of it not being democratic and elected. In some ways, it is much more serious than that because of how the system would be blocked up. It is a much broader objection. It is a fairly important point, but it is not one on which I rest the case exclusively. To that extent, we expect the planning authorities to work in the best interests of the public at all times in any event.
6.30 p.m.
Baroness Hamwee: My Lords, I thank the Minister for his response. I note his additional remark that it is one that he really believes in. He will need to be careful, otherwise Members of the House will start to separate his responses into those that he is reading and those that he believes in.
The point about whether applicants should be refused a right of appeal is a good one. I do not claim credit for it; Clive Betts in another place raised it. As regards the conduct of local authorities, I do not assume impropriety. I seek a way for local authorities to be seen to be conducting business properly.
The noble Lord, Lord Lucas, raised an interesting point about leave to appeal, which, I can see, might be put in place in the same way as some appeals through the courts require leave before the appeal itself can be instituted. I am not sure whether I am right, but I think that one needs leave before starting a judicial review. I would like to consider that interesting point later. I shall not attempt, therefore, to respond to all the points that the Minister has made. I beg leave to withdraw the amendment.
Amendment by leave withdrawn.
Baroness Hamwee Baroness Hamwee moved Amendment No. 142B:
Before Clause 51, insert the following new clause—
"DURATION OF PLANNING PERMISSION AND CONSENT
(1) Section 91 of the principal Act (limit on duration of planning permission) is amended by inserting at the end of subsection (2) the words "and any other matters which the authority consider relevant"

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(2) Section 18 of the listed buildings Act (limit of duration of listed building consent) is amended by inserting at the end of subsection (1)(b) the words "and any other matters which the authority consider relevant."
The noble Baroness said: My Lords, included in this group are Amendments Nos. 142C and 142E, in the names of the noble Baroness, Lady Hanham, and the noble Lord, Lord Hanningfield, but to which my noble friend and I have attached our names, and Amendments Nos. 142DS and 142E, which are tabled in my name and that of my noble friend. All the amendments relate to the duration of planning consent.
Amendment No. 142B was designed to achieve what the Government appear to be concerned about. It would amend Section 91 of the 1990 Act, the provision dealing with duration, which has a default period of five years but provides that that period can be whatever the authority considers appropriate having regard to the provisions of the development plan and other material considerations. The new clause would provide for the addition of the words,
"and any other matters that the authority considers relevant".
A similar provision would be made in the listed buildings Act.
Under the existing legislation the authority can have regard to material considerations. I am certainly not sufficiently informed of case law on what is "material", hut, as I read the provisions in the existing legislation, it is matters that are material to the application, not to the applicant. In response to a point that I put in Committee, the Minister indicated that matters such as site assembly and putting in place the funding are not material for this purpose. In other words, the local authority could not have regard to those difficulties under the existing legislation. That is why I want it to look at other things it thinks are relevant, because putting the site together for a large scheme is relevant.
The Government is concerned about "land-banking", slowly putting together land and holding on to it until it seems to be a good time, from their point of view, to develop it. I am not saying that we, from these Benches, disagree with the Government wholly in this. But their way of dealing with what they perceive as being a problem is going to make matters worse. The Minister said in Committee that the majority of permissions are implemented within three years—the default provision within the Bill. Surely those are the small, easy applications and not the big schemes. They are not the sites that are difficult, which require remediation—a word I think the Minister had to define yesterday.
I am sure that noble Lords concerned with planning know about the difficulties of contamination, the desirability of building on brownfield land and the obstacles that may be added to that if its developers have to do it in the way that is provided here. We all know about the complexities of funding arrangements. The Government want to get house-building schemes achieved, and we share that objective. To suggest that developers should be required to submit a new
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application to extend a three-year permission will mean a real danger that developers will not undertake the most difficult sites—the brownfield sites in particular—which we want to see developed or redeveloped.
The Government want flexibility—that term has been used—for local planning authorities and for the developers to discuss what is appropriate in each case. "Flexibility" is a favourite word. Our proposal in Amendment No. 142B to allow the authority to extend the matters to which it can have regard, if we are stuck with a three-year provision, would be a helpful one. However, I would prefer that we stay where we are, and support the amendments of the noble Baroness, Lady Hanham, which I appreciate would pre-empt my Amendments Nos. 142D and 142F. We support leaving out subsections (1), (2) and (4), which are the subjects of the amendments on which she will lead, and to which we have attached our names.
The Minister has told us that there has already been a consultation on the three-year default period. I admit that I have not researched this. But I suspect that there must have been a resounding "No" from the development industry in this consultation on just the sort of sites that the Government is concerned about. The more I think about the reduction to three years, the more I am concerned that it will do precisely the opposite of what the Government seek.
Our amendments, which I very much hope will be pre-empted in the course of our agreeing Amendments Nos.142C and 142E, also provide for an alteration to dealing with the three-year period. This is a suggestion which has come from the industry: to start the clock running when all associated consents, permissions or clearances have been given, with a top limit of five years. "Associated consents" means such matters as the following, from the five main statutory agencies which most often require them: the Highways Agency, almost invariably when the scheme is of any size the permission cannot be implemented until there is a new junction or access; the Environment Agency, involving permits for the control of pollution legislation, sewage, water services and so on; water authorities like British Waterways, again involving water and sewage removal; English Heritage, where listed building consent is required and where a separate application to English Heritage for approval is needed; fifthly, English Nature, where the site is a particularly sensitive one and there may be a lengthy, and no doubt important and useful, negotiation period.
I am told, and certainly it has been my own experience, that the Highways Agency has been the cause of—I quote the British Property Federation—"most concern" for a number of organisations in its requirements. I am aware that the president of the Royal Town Planning Institute has written an open letter to the Government about the negative impact that the Highways Agency has on the development process.
I thought it appropriate to speak on those clauses at this point, as I will not be able to come back until the very end of this debate. But I will make it clear again

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that although we start with Amendment No. 142B, we hope to stick to the live-year period and for the Government to explain to local authorities that they have these powers: that the five years is a period which can be shortened should that be the right thing to do. I beg to move.
6.45 p.m.
Baroness Hanham: My Lords, I have tabled Amendments Nos. 142C and 142E in this group. As the noble Baroness, Lady Hamwee, has said, my amendments address directly the time of planning permissions and the reduction, as the Bill would have it, of the consents from a position of five years to three years. We have received an enormous number of representations on this, and it is fair to say that this part of the Bill has been almost universally condemned. There are many concerns that have been expressed and I will try not to cover again the ground that the noble Baroness, Lady Hamwee, already has. I will briefly charge over those.
First, there is confusion as to why these changes need to be made to the current system. Local planning authorities already have powers to shorten the consent from the default five years if they want to. Instead of Clause 51, the Government should issue best practice guidance on when it would be appropriate for councils to exercise their existing rights to issue shorter consents, such as when there is a strong likelihood of house builders banking land, or in very simple developments that could be completed quickly. For once, the option is there for the Government to pick up. But it seems to be the general consensus that, far from saving the local planning authority time and resources, they will no longer be able to grant extensions to planning permissions. Applicants will be forced to submit an entirely new application, and the local authority will be burdened further if the three-year period has been superseded. For many developments, three years is simply not going to be long enough, and this short consent will only serve to put off potential developers. This is especially the case for brownfield city centre sites and mixed use developments—precisely the developments that the Government insist on telling us all the time that they are keen to encourage as part of their sustainable communities agenda. Marginal schemes on complex sites and regeneration areas will be much more difficult.
Funding commercial and mixed development is already problematic, as it is much more risky than traditional house-building, and the changes in the Bill make it harder still. It seems that what the Government are trying to achieve with one hand—successful urban regeneration—will be undermined by the other. By reducing the duration of consent, developers will be discouraged from taking on precisely this type of project.
Many of the organisations we have spoken to have pointed out the same matters raised by the noble Baroness, Lady Hamwee: consents from the Highways Agency; consents from the fire brigade; consents from the Environment Agency; compulsory purchase may
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be necessary to decontaminate contaminated land; pre-letting; negotiating of finance; and the tendering of contracts.
A whole range of matters are encompassed within the granting of planning permission. Another issue is the time scale within which these matters have to be sorted out before planning and development can actually start. A three-year period will cause immense difficulties for developments of this scale and nature. It will not encourage people to bring them forward. Three years is adequate for smaller-scale planning permissions, but those arrangements are already working well.
Clause 51(2) is concerned not with the granting of full planning permission but with the issue of outline planning permission. The effect of the Government's changes to planning applications is that an application for the approval of reserved matters must be made within three years of the grant of that planning permission. The developer has two years after the local planning authority's approval of the final reserved matters to begin the development. That has a number of strange results. First, while the Bill considers that full planning permission should be implemented within three years, an outline planning permission will have five years or more. The Government's intention to reduce the period for implementing planning permissions applies only to full planning permission.
Secondly, if a reserved matter approval is sought and granted within six months of the grant of outline planning permission, the developer will have to start development in the next two years; that is, two years and six months after the grant of planning permission. Within that time the developer has to sort out the money and everything else that is needed before the development can start.
For the reasons that the noble Baroness and I have outlined, we are strongly against Clause 51 in all its manifestations. We on these Benches very much support her amendments in this group, even if mine pre-empt them.
Lord Lucas: My Lords, I thoroughly support my noble friend in this. It seems that the default ought to be the value which is appropriate in most circumstances. The vast majority of planning permissions are small domestic and personal matters. It seems to me that it is widely accepted that five years is a reasonable time scale for the generally disorganised and stumbling public to have to contend with. It gives someone a reasonable time within which to complete the development for which they have permission without placing them under any undue stress. They can plan things properly; they can get things organised; and they can allow their builders to overrun by two years, as has happened to me on occasion. All the ordinary difficulties that happen to the inefficient individual ought to be allowed for in the general time scale of planning permissions.
As both Front-Benchers said, there is a class of difficult major schemes which require long time scales. There is undoubtedly a class of relatively simple new-builds or major refurbishments which jolly well ought

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to be got on with and finished in three years. If it has been agreed to build 15 new houses in a village, everyone will want to know when it will start so they can take all the other action. If it is part of providing housing in the area, five years would clearly be too long.
In those circumstances, the process should be telescoped to two years, three years or whatever is appropriate for that development. However, that should be done by giving strong guidance to authorities that they should squeeze the time limit in commercial developments when they can, when it is important, to ensure that housing is provided as swiftly as reasonably possible. That is the way to do it. Exceptions should be dealt with in guidance. We should not distort the overall legislation. We should not make almost every planning permission an exception to the default in legislation. Everyone will want to say, "I need more than three years because I cannot be sure of the builders; my wife cannot decide what colour she wants the bedroom; and I don't want to put the window in until we have that straight".
We are used to a five-year time scale. Everyone seems to be generally happy with it. It is a default that we should stick with. Let us deal with the exceptional cases in an exceptional way and not in the body of the Bill.
Lord Bassam of Brighton: My Lords, my guess is that, ultimately, there ain't a lot between us on the objective; the question is simply how we get there. I have listened carefully, particularly to the practical words spoken by the noble Lord, Lord Lucas. However, I am not persuaded of his point. For that reason, and because it is right that I should do so, I shall go through the points very carefully.
I understand exactly why Amendment No. 142B has been tabled—to address concerns that when a local planning authority considers the length of time that a planning application should remain valid it will not consider matters such as the length of time it takes to assemble the site and organise funding.
Section 91(2) of the Town and Country Planning Act 1990 and Section 18(1)(b) of the Planning (Listed Buildings and Conservation Areas) Act 1990 require the local planning authority to consider "other material considerations". Ultimately, of course, the courts are the ultimate arbiters of what constitutes a material consideration. Our view is that these matters could be material considerations in a decision on how long an application or consent should remain valid. In such a case, a local planning authority considering the duration of time needed for a planning permission might have regard to the time needed to assemble finance and land, particularly in the case of complex regeneration projects. It is perhaps worth pointing out that there are few benefits for the authority in setting periods which prove unworkable if that would result in the developer submitting a new application or consent.
As the noble Baronesses, Lady Hanham and Lady Hamwee, explained, Amendment No. 142C would delete the provision making three years, instead of five
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years, the default duration of planning permission. It would delete the provision that where planning permission is granted, and that grant of permission is subsequently challenged in judicial review proceedings, the duration of permission will be from the date of grant until three years—or other period as directed by the determining authority—after the completion of the proceedings. It would retain the existing provisions of Section 92 of the Town and Country Planning Act 1990.
Amendment No. 142D would require a permission to be implemented within three years or a later date within five years depending on the date on which the last of all associated consents has been granted, including consents by a judicial body.
Amendment No. 142E would delete the provision making three years, instead of five years, the default duration of listed building consent. It would delete the provision that where listed building consent is granted, and that grant is subsequently challenged in judicial review proceedings, the duration of consent will be from the date of grant until three years—or other period as directed by the determining authority--after the completion of the proceedings.
Amendment No. 142F would require a listed building consent to be implemented within three years or a later date within five years depending on the date on which the last of all associated consents has been granted, including consents by a judicial body.
We have already had a lengthy debate on this, but it is worth going through the points in a little more detail. I want the reasons for the Government's position to be clearly understood.
The noble Baroness, Lady Hanham, said that she did not like Clause 51 because it reduces the period of validity of a planning permission, listed building consent and conservation area consent from five to three years. Local planning authorities will be able to agree longer periods where appropriate. There is a right of appeal to the Secretary of State.
The clause also prevents a developer from seeking to extend a permission by submitting an application to vary a condition. Any developer wishing to extend the time limit will have to submit a new application for planning permission and the local planning authority will consider the entire application afresh.
In Committee, the noble Baroness, Lady Hanham, asked why this clause was necessary as local authorities already have the power to shorten planning consent from the current duration of five years. She has repeated that question today. It was also suggested that instead of this clause the Government should issue best practice guidance—another point repeated today. Furthermore, it has been argued that, for major developments, three years will not be long enough.
I understand those points, but it is our view that the clause is designed to create a clear framework and to send a strong signal that the planning system is to be speeded up. Our intention is to encourage developers to start work at the earliest possible point. No longer will they be able to sit on permissions for years on end without starting works. Circumstances can change in

193
three years and a shorter default period for planning permission would allow changes to national guidance to take effect more quickly.
As we have made clear, we recognise the need for flexibility. It is extremely important. Moreover, as I have said before, cases will arise involving complex regeneration projects that take time to put together. They will require a longer period. We intend to specify in guidance that local planning authorities should consider actively longer periods in those cases. In setting time limits, local authorities will need to be mindful of the requirements they impose on the form of planning conditions.
The noble Baroness, Lady Hanham, has contrasted the provision for the implementation of full planning permission within three years with the current position that outline planning permission has five years or more. As we have already indicated, the future of outline planning permission is under review. Whatever we decide about outline planning permission, our resolve to speed up the operation of the planning system remains. I must say that I have been impressed by the fact that, at several different points during debates on the Bill, all sides have concurred with the view that we need to apply more pressure to speed up the planning process. I have not heard too many words spoken in defence of the way in which the current system operates, where delay is inherent.
Both noble Baronesses, Lady Hamwee and Lady Hanham, have raised questions about the provisions set out in subsection (1)(b) on judicial review. Amendments Nos. 142D and 142F address this issue. The noble Baroness, Lady Hanham, raised several legal concerns about the clarity of this subsection. We understand the force of the argument about judicial review and we are now considering carefully how to proceed on this point. A local planning authority might also wish to consider the time needed to secure associated consents—the issue raised in the amendments—when deciding on the appropriate duration for planning permission or a listed building consent.
I also listened carefully to what was said by the noble Lord, Lord Lucas, on this issue. His argument was based on what I think is fair to describe as the large volume of planning cases comprising small, domestic matters that are brought to planning authorities for resolution. The noble Lord defended the right of people to take their time. I understand that entirely, but certainly in my experience most people complete their plans for domestic applications within the three-year period.
We have sought here to ensure that there is pressure to complete such planning matters within the three-year period. We have allowed flexibility for longer and more complex planning applications, in particular those involving regeneration because we recognise their complexity. Furthermore, we have given a commitment to consider some of the additional points raised by the noble Baroness, Lady Hanham, about the drafting of the judicial questions.
194
Clause 51, with its core intention to reduce the default period for planning permission, is a central and key part of the Government's programme for modernising and speeding up the planning system. I repeat, I have not heard voices arguing for delay and obfuscation in planning, and I cannot believe that they would be raised, in particular in your Lordships' House. I cannot accept the amendments, although as I have indicated, we will consider how best to deal with the concerns expressed on the issue of judicial review.
For all those reasons, and because of a desire to make the system swifter and more efficient, as well as to create more realistic but flexible and clear targets, I hope that the noble Baronesses will not press their amendments.
Baroness Hamwee: My Lords, the noble Lord says that there is little between us, but there are two years between us here. It is not a question of choosing the bathroom tiling or deciding which colour to paint the back bedroom; it is the question of two years and, certainly in my case, it is the big scheme. To flatter the Minister by copying him, I should say that I genuinely believe in what I am saying—which is likely since I wrote the words.
The noble Lord, Lord Bassam, has said that ultimately the courts are the arbiters of what are material considerations. Today I seem to have heard a slightly different response on whether certain matters may be material from that given on previous occasions, but to be told that associated consents may not be material considerations leaves me, to be frank, too puzzled to want to rely on the courts.
Basically, we are being asked to agree to a strong signal being sent to local authorities to get on with it, or to ensure that the developers do so. However, that strong signal could be given in the form of further guidance to local authorities on the application of Section 91(1)(b) and 91(2) of the Town and Country Planning Act 1990 which states in terms that the permission must be started within five years or,
"such other period (whether longer or shorter) beginning with that date as the authority … may direct".
The Government are not usually coy about advising and guiding local authorities, therefore they can remind them that a limit of three years can be put on the permission.
I am not going to be taken down the road of considering what would be good planning, whether in terms of speed or quality. I return instead to my real concern. The provisions that the Government are seeking to enact in Clause 51 will mean that the major developments we want to see, in particular in housing, will be so much harder to achieve. Members on these Benches are not noted for adopting the developer's point of view in a knee-jerk way, but we do listen to the arguments that have been made. We are very persuaded by those arguments. I should like to test the opinion of the House.
7.8 p.m.
On Question, Whether the said amendment (No. 142B) shall be agreed to?
Their Lordships divided: Contents, 122; Not-Contents, 99.

Division No. 4

CONTENTS

Addington, L.

McNally, L.

Anelay of St Johns, B.

Maddock, B.

Astor, V.

Mar and Kellie, E.

Attlee, E.

Masham of Ilton, B.

Avebury, L.

Methuen, L.

Barker, B.

Michie of Gallanach, B.

Biffen, L.

Miller of Chilthorne Domer, B.

Blackwell, L.

Miller of Hendon, B.

Bowness, L.

Moore of Lower Marsh, L.

Bradshaw, L.

Moynihan, L.

Bridgeman, V.

Newby, L.

Brookeborough, V.

Noakes, B.

Brougham and Vaux, L.

Northbrook, L.

Byford, B.

Northesk, E.

Carlisle of Bucklow, L.

Northover, B.

Clement-Jones, L.

Norton of Louth, L.

Colville of Culross, V.

Oakeshott of Seagrove Bay, L.

Colwyn, L.

Onslow, E.

Cope of Berkeley, L.

Palmer, L.

Craigavon, V.

Park of Monmouth, B.

Crathorne, L.

Peel, E.

Crickhowell, L.

Platt of Writtle, B.

Deedes, L.

Rawlings, B.

Dholakia, L.

Reay, L.

Dixon-Smith, L.

Redesdale, L.

Dundee, E.

Rees, L.

Eden of Winton, L.

Renfrew of Kaimsthorn, L.

Erroll, E.

Rennard, L.

Falkland, V.

Renton, L.

Ferrers, E.

Rodgers of Quarry Bank, L.

Fookes, B.

Roper, L.

Forsyth of Drumlean, L.

Rotherwick, L.

Fowler, L.

Russell, E.

Freeman, L.

St. John of Bletso, L.

Geddes, L.

Scott of Needham Market, B.

Glentoran, L.

Seccombe, B.

Goodhart, L.

Selborne, E.

Gray of Contin, L.

Selsdon, L.

Greaves, L.

Sharman, L.

Greenway, L.

Sharp of Guildford, B.

Hamwee, B.

Sharples, B.

Hanham, B.

Shaw of Northstead, L.

Hanningfield, L.

Shutt of Greetland, L.

Harris of Richmond, B.

Skelmersdale, L.

Henley, L.

Smith of Clifton, L.

Hodgson of Astley Abbotts, L.

Soulsby of Swaffham Prior, L.

Home, E.

Strathclyde, L.

Howe, E.

Swinfen, L.

Hunt of Wirral, L.

Tebbit, L.

Jenkin of Roding, L.

Thomas of Gresford, L.

Jopling, L.

Thomas of Gwydir, L.

Kimball, L.

Thomas of Walliswood, B.

King of Bridgwater, L.

Tope, L.

Kingsland, L.

Tordoff, L.

Knight of Collingtree, B.

Trumpington, B.

Lester of Herne Hill, L.

Ullswater, V.

Livsey of Talgarth, L.

Vinson, L.

Lucas, L.

Waddington, L.

Luke, L.

Wakeham, L.

Lyell, L.

Walmsley, B.

196

Walpole, L.

Watson of Richmond, L.

NOT-CONTENTS

Acton, L.

Hughes of Woodside, L.

Alton of Liverpool, L.

Irvine of Lairg, L.

Amos, B. (Lord President of the council)

Janner of Braunstone, L.

Jay of Paddington, B.

Andrews, B.

Jones, L.

Bach, L.

Judd, L.

Barnett, L.

Kirkhill, L.

Bassam of Brighton, L.

Levy, L.

Bernstein of Craigweil, L.

Listowel, E.

Blackstone, B.

Lockwood, B.

Borrie, L.

Lofthouse of Pontefract, L.

Bragg, L.

Mcintosh of Haringey, L.

Brooke of Alverthorpe, L.

McIntosh of Hudnall, B.

Brookman, L.

MacKenzie of Culkein, L.

Brooks of Tremorfa, L.

Mackenzie of Framwellgate, L.

Burlison, L.

Mar, C.

Campbell-Savours, L.

Carter, L.

Mason of Barnsley, L.

Chan, L.

Massey of Darwen, B.

Clarke of Hampstead, L.

Merlyn-Rees, L.

Corbett of Castle Vale, L.

Mitchell, L.

Crawley, B.

Morgan of Huyton, B.

David, B.

Morris of Aberavon, L.

Davies of Coity, L.

Morris of Manchester, L.

Davies of Oldham, L.

Orme, L.

Dixon, L.

Parekh, L.

Dubs, L.

Patel of Blackburn, L.

Elder, L

Pendry, L.

Evans of Temple Guiting, L.

Pitkeathley, B.

Farrington of Ribbleton, B.

Ramsay of Cartvale, B.

Faulkner of Worcester, L.

Rendell of Babergh, B.

Filkin, L.

Rooker, L.

Fyfe of Fairfield, L.

Sainsbury of Turville, L.

Gale, B.

Sawyer, L.

Gibson of Market Rasen, B.

Scotland of Asthal, B.

Gilbert, L.

Simon, V.

Goldsmith, L.

Smith of Leigh, L.

Gordon of Strathblane, L.

Symons of Vernham Dean, B.

Goudie, B.

Taylor of Blackburn, L.

Gould of Potternewton, B.

Temple-Morris, L.

Graham of Edmonton, L.

Thornton, B.

Grocott, L.

Harris of Haringey, L.

Tomlinson, L.

Harrison, L.

Triesman, L.

Haskel, L.

Turner of Camden, B.

Haskins, L.

Warner, L.

Hayman, B.

Warwick of Undercliffe, B.

Hilton of Eggardon, B.

Weatherill, L.

Hollis of Heigham, B.

Whitaker, B.

Howarth of Breckland, B.

Wilkins, B.

Hoyle, L.

Woolmer of Leeds, L.

On Question, amendments agreed to.

Resolved in the affirmative, and amendment agreed to accordingly.
7.18 p.m.
Clause 51 [Duration of permission and consent]:
The Deputy Speaker (Lord Lyell): My Lords, I advise the House that if Amendment No. 142C is agreed to, I cannot call Amendment No. 142D.
[Amendment No. 142D not moved.]
The Deputy Speaker: My Lords, if Amendment No. 142E is agreed to, I cannot call Amendment No. 142F.
[Amendment No. 142F not moved.]
[Amendment No. 143 had been withdrawn from the Marshalled List.]
Lord Rooker Lord Rooker moved Amendment No. 143A:
After Clause 51, insert the following new clause—
"TEMPORARY STOP NOTICE
After section 171D of the principal Act (penalties for non-compliance with planning contravention notice) there are inserted the following sections—
"Temporary stop notices
171E TEMPORARY STOP NOTICE
(1) This section applies if the local planning authority think—

(a) that there has been a breach of planning control in relation to any land, and

(b) that it is expedient that the activity (or any part of the activity) which amounts to the breach is stopped immediately.

(2) The authority may issue a temporary stop notice.
(3) The notice must be in writing and must—

(a) specify the activity which the authority think amounts to the breach;

(b) prohibit the carrying on of the activity (or of so much of the activity as is specified in the notice);

(c) set out the authority's reasons for issuing the notice.

(4) A temporary stop notice may be served on any of the following—

(a) the person who the authority think is carrying on the activity;

(b) a person who the authority think is an occupier of the land;

(c) a person who the authority think has an interest in the land.

(5) The authority must display on the land—

(a) a copy of the notice;

(b) a statement of the effect of the notice and of section 171G.

(6) A temporary stop notice has effect from the time a copy of it is first displayed in pursuance of subsection (5).
(7) A temporary stop notice ceases to have effect—

(a) at the end of the period of 28 days starting on the day the copy notice is so displayed,

(b) at the end of such shorter period starting on that day as is specified in the notice, or

(c) if it is withdrawn by the local planning authority.

171F TEMPORARY STOP NOTICE: RESTRICTIONS
(1) A temporary stop notice does not prohibit—

(a) the use of a building as a dwelling house;

(b) the carrying out of an activity of such description or in such circumstances as is prescribed.

(2) A temporary stop notice does not prohibit the carrying out of any activity which has been carried out (whether or not continuously) for a period of four years ending with the day on which the copy of the notice is first displayed as mentioned in section 171 E(6).
(3) Subsection (2) does not prevent a temporary stop notice prohibiting—

(a) activity consisting of or incidental to building, engineering, mining or other operations, or

(b) the deposit of refuse or waste materials.

(4) For the purposes of subsection (2) any period during which the activity is authorised by planning permission must be ignored.
(5) A second or subsequent temporary stop notice must not be issued in respect of the same activity unless the local planning authority has first taken some other enforcement action in relation to the breach of planning control which is constituted by the activity.
(6) In subsection (5) enforcement action includes obtaining the grant of an injunction under section 187B.
171G TEMPORARY STOP NOTICE: OFFENCES
(1) A person commits an offence if he contravenes a temporary stop notice

(a) which has been served on him, or—

(b) a copy of which has been displayed in accordance with section 171E(5).

(2) Contravention of a temporary stop notice includes causing or permitting the contravention of the notice.
(3) An offence under this section may be charged by reference to a day or a longer period of time.
(4) A person may be convicted of more than one such offence in relation to the same temporary stop notice by reference to different days or periods of time.
(5) A person does not commit an offence under this section if he proves—

(a) that the temporary stop notice was not served on him, and

(b) that he did not know, and could not reasonably have been expected to know, of its existence.

(6) A person convicted of an offence under this section is liable—

(a) on summary conviction, to a fine not exceeding £20,000;

(b) on conviction on indictment, to a fine.

(7) In determining the amount of the fine the court must have regard in particular to any financial benefit which has accrued or has appeared to accrue to the person convicted in consequence of the offence.
171H TEMPORARY STOP NOTICE: COMPENSATION
(1) This section applies if and only if a temporary stop notice is issued and at least one of the following paragraphs applies—

(a) the activity which is specified in the notice is authorised by planning permission or a development order or local development order;

(b) a certificate is issued by the local planning authority in respect of the activity under section 191;

(c) the authority withdraws the notice.

(2) Subsection (1)(a) does not apply if the planning permission is granted on or after the date on which a copy of the notice is first displayed as mentioned in section 171E(6).
(3) Subsection (1)(c) does not apply if the notice is withdrawn following the grant of planning permission as mentioned in subsection (2).
(4) A person who at the time the notice is served has an interest in the land to which the notice relates is entitled to be compensated by the local planning authority in respect of any loss or damage directly attributable to the prohibition effected by the notice.
(5) Subsections (3) to (7) of section 186 apply to compensation payable under this section as they apply to compensation payable under that section; and for that purpose references in those subsections to a stop notice must be taken to be references to a temporary stop notice.""
The noble Lord said: My Lords, this is a group of four new clauses. Amendment No. 143A forms a positive response to the review of the planning enforcement system in England, and to the noble Lords opposite who have sought to introduce their own amendments regarding enforcement powers.
The amendment provides local planning authorities with a new discretionary power to serve temporary stop notices to halt breaches of planning control for a period of up to 28 days.
New Section 171E enables the local planning authority to issue a temporary stop notice where there has been a breach of planning control where they consider it expedient to do so to prevent further development. The new section also sets out how the stop notice should be issued, in what form and to whom. The notice must set out the reason for issuing the notice. The temporary stop notice will have effect immediately; it is displayed on the land and ceases to have effect after 28 days unless it is withdrawn earlier.
New Section 171F sets out restrictions for the use of the temporary stop notices. Temporary stop notices do not prohibit the use of a building as a dwelling house and will not prohibit the carrying out of an activity that has already been carried out for four years or more.
New Section 171F also enables the Secretary of State to prescribe in regulations other activities that a temporary stop notice shall not apply to, even though those activities are in breach of planning control. Regulations may set out these activities either by describing them or by setting out the circumstances when an activity cannot be prohibited by a temporary stop notice.
New Section 171G sets out a new offence of breaching a temporary stop notice and the penalties that result from conviction. The penalties for contravening a stop notice are: on summary conviction in a magistrates' court, a fine not exceeding £20,000; and, on conviction on indictment in a Crown Court, a fine. In deciding the level of any fine, the court may take into account the financial gain accrued while the temporary stop notice was breached. The penalties replicate those that already exist in relation to stop notices under Section 187 of the 1990 Act.
New Section 171H sets out the circumstances in which compensation can be claimed from the local planning authority and is limited to: when the activity subject to the temporary stop notice already had planning permission when the stop notice was issued; when the activity has permitted development rights; when the activity has or acquires a lawful development certificate; or when the authority withdraws its notice. These provisions for compensation against losses offer protection against local planning authorities which serve notices in error. The procedure for claiming compensation replicates the provision in the 1990 Act for stop notices.
We have introduced the amendment as a result of the review of the planning enforcement system. This was one of the proposals put forward for comment,
200
and over 200 respondents agreed that such powers would be helpful in speeding up the process of enforcement. The proposed temporary stop notice gives a new power to local planning authorities and the means to prevent unauthorised development at an early stage without first having to issue an enforcement notice.
Local planning authorities' enforcement powers are discretionary. The amendment is designed to enable action to be taken which is appropriate to the breach. Currently, stop notices can be served only in conjunction with an enforcement notice and can be used to tackle the most serious breaches.
Before an enforcement notice is issued the local planning authority will usually wait to see whether the unauthorised development is likely to cause harm. Under the current system, in order for work to stop, an enforcement notice has to take effect or a stop notice has to be issued to stop any further work taking place. In the case of an enforcement notice, this can be several months after development or the planning breach has started, particularly if an appeal is made against the enforcement notice. If stop notices are served, no further work can be done.
The temporary stop notice will bring an early halt to development which does not have planning permission. It will help to end the practice whereby a developer can build and apply retrospectively for planning permission for a completed building. If any breach of planning has to be stopped immediately, the planning injunction can be used. But injunctions are only used to prevent serious harm. They require court time and of course are expensive.
The temporary stop notice provides the local authority with a power to stop a breach of planning control for a limited period of time to enable it to decide whether further enforcement is appropriate and what action should be taken without the breach being "compounded" by being allowed to continue.
The planning system exists to control the development and use of land and is in the public interest. Ignoring planning controls is unfair and undermines public confidence in the system. Unauthorised development can be dangerous and damaging to the locality.
Better, faster, more efficient enforcement will help engender confidence and trust in the planning system. Prompt action will act as a disincentive to those who might seek to deliberately ignore planning controls and will give local authorities the confidence to take appropriate action. This power will, I am sure, be welcomed by local planning authorities to use in addition to the panoply of discretionary powers they already have across the range of planning breaches they encounter every day.
As I said, it can be extremely frustrating when a development goes ahead without planning permission. It affects neighbours and it can sometimes be months before any action, if any, is taken by local authorities. I know that from my own experience as a constituency Member of Parliament.
A temporary stop notice does not have to be used in all enforcement cases; local authorities already have at their discretion a number of different ways of taking action. It would be used only where local planning authorities consider it expedient to stop a breach immediately. Current arrangements may be sufficient in most cases. I would expect any use of this power to be reasonable, responsible and proportionate.
These temporary stop notices could be used in a variety of circumstances, many of which have been raised with us in the enforcement review and during the passage of the Bill through Parliament. These might include the inappropriate change of use of someone's back yard to a car paint-spraying business or the construction of an extension without planning permission.
They would also clearly be an option for local authorities to consider where Gypsy and Traveller groups have begun unauthorised development on an inappropriate site, perhaps in the green belt. We are, however, concerned to ensure that the temporary stop notice should not be used unfairly or inappropriately. We are mindful of the difficult circumstances surrounding accommodation for Gypsies and Travellers. A major review is under way in the Office of the Deputy Prime Minister at the moment. As we have said before, to address these problems we need greater site provision—that is, more sites—including greater support for Gypsies and Travellers to identify appropriate sites of their own to develop, alongside more effective enforcement on inappropriate sites.
We are currently reviewing circular 1/94 with the intention of providing more support for Gypsies and Travellers to identify their own appropriate sites. We are also reviewing the operation of housing needs assessment to build in consideration of Gypsy and Traveller accommodation needs at an early stage. These changes will take some time to implement. In the meantime, we are keen to ensure that Gypsies and Travellers are not treated unfairly relative to other groups.
We therefore intend to introduce regulations which will replicate the current exemption for buildings used as dwellings to caravans used as dwellings. The content of the regulations will be a matter for consultation. However, the intention is that they will include measures that, although caravans which are occupied as a sole or main residence on site will be allowed to remain until any follow-up enforcement action is taken, any further associated works will be "caught" by the stop notice.
We are introducing this exemption through regulations rather than on the face of the Bill for two reasons. First, we want the temporary stop notice to replicate the shape of the existing stop notice; secondly, we want the flexibility to change the position with regard to caravans as further detail of the policy around Gypsy and Traveller accommodation develops and as local authorities enable greater site provision in their areas. I hope that broadly explains why we are bringing in this group of new sections.
We are very sympathetic to the spirit of the noble Lord's Amendment No. 143AA that it is right to afford similar protection to Gypsies and Travellers dwelling in caravans as those who live in houses. It is our clear intention to do so. I believe that regulations are a more effective and flexible way of achieving this as they will be subject to consultation, ensuring that the exemptions we propose are both workable and acceptable to those that they cover. The proposal for using the regulations I referred to a short while ago will permit caravans already on site to remain. I hope that answers the points that the noble Lord will make in due course.
Amendment No. 143B seeks to amend the new provisions for the new temporary stop notice compensation by removing the reference to local planning authorities being the only authority to issue a lawful development certificate. It allows lawful development certificates granted on appeal to the Secretary of State to be included in the compensation provisions. That is a valid point which we shall consider.
Amendment No. 144 seeks, through a new clause, to give local planning authorities similar powers in respect of enforcement of a stop notice as they already have for seeking compliance with and taking remedial action in respect of an enforcement notice. That includes steps to be taken to remedy the breach, to remedy any injury to amenity and to seek to cease activity on the land, including the removal of objects. These powers are already available to local planning authorities.
Local planning authorities already have powers to enter land and take the steps required by the enforcement notice to remedy the situation. They can also recover from the person who is then the owner of the land any expenses reasonably incurred by them.
The stop notice can be served only after or at the same time as the enforcement notice and must relate to the activity prohibited by the enforcement notice. Although both the enforcement notice and the stop notice set out details of the activity or development which must cease, it is the enforcement notice which gives details of the remedial action which must be taken, not the stop notice.
We are sympathetic to the aims behind the amendment but duplicating the powers of the enforcement notice in the existing stop notice will not solve the problem of stopping unauthorised development or intensification of the land in the first 28 days after the breach has occurred. We think that a better way to deal with this problem is the new temporary stop notice—provision is in the four new clauses I have introduced—which will give local planning authorities power to stop breaches of planning control immediately the notice is served.
I hope, therefore, that that will be sufficient and that in due course the noble Baroness and noble Lord, having moved their amendments, will feel able to withdraw them. I beg to move.
7.30 p.m.
Lord Avebury moved, as an amendment to Amendment No. 143A, Amendment No. 143AA:
Line 57, at end insert—
"(7) No such notice shall be issued in relation to breach of planning control by gypsies or other travellers unless the Secretary of State has certified that sufficient accommodation exists for gypsies or other travellers residing in or resorting to the region of which the local planning authority forms a part."
The noble Lord said: My Lords, the Minister said that this set of amendments was introduced as a result of the review of the planning enforcement system in which 200 respondents said that it would be helpful to have these additional powers. If that is the case, why could not the amendment have been tabled earlier instead of—as it was—on the Thursday before the first day on Report? If we had not been rather slower than the Government expected and hoped, we should have had 24 hours in which to consider the amendment and to put down our own amendment, with no time to consult those outside concerned in particular as regards the interests of Gypsies and Travellers. As the noble Lord said, they will be affected by the temporary stop notices. I should not be surprised to hear, if the noble Lord can tell me, that no representations among the 200 responses he cites were received from Gypsy or Traveller organisations because they are universally opposed to the provisions of the new sections.
During the two extra weeks we were given to consider the amendments, the Minister will be aware that there was a debate in another place on a Private Member's Bill in which some light was cast on the Government's proposals by the honourable Member for Brentwood and Ongar and some of his colleagues. In reply to that debate, the Minister for Housing and Planning, Mr Hill, said that the Government had anticipated most of the wishes expressed by the honourable Member in his Town and Country Planning Enforcement and Stop Notices Bill. He said that these new temporary stop notices were specifically designed to allow rapid intervention in potentially inadmissible developments and were a response to the strength of feeling demonstrated by Members during Committee and Report stages of the Bill. He added that the Government were greatly concerned about Gypsies carrying out developments without planning permission. Therefore, it is clear that the amendment is not directed against people who use their backyards for paint spraying. It is firmly and exclusively directed against Gypsies and Travellers.
The Government recognise that under the existing planning regime it is virtually impossible for Gypsies to get planning permission. That is why they said the Minister repeated it today—that they will scrap circular 1/94 which Ministers said at the time of the infamous Criminal Justice and Public Order Act 1994 was then designed to enable Gypsies to make provision for their own accommodation in place of the obligation that previously existed on local authorities to provide sites for Gypsies and Travellers.
Obviously, since no local authority has ever given Gypsies any indication of the places where they could develop their own site, but have all adopted under circular 1/94 criteria-based policies which were designed to lead to refusals whenever they sought planning permission, what Gypsies had no alternative but to do was to buy land wherever they could, apply for planning permission, and then to appeal when they were refused, as inevitably happened.
The Minister, Mr Hill, knows perfectly well that it is futile to suggest to Gypsies, as he did in reply to the debate in another place, that they should work with planning authorities to identify land that is suitable for development. If that had been the way forward, there would have been no need to replace circular 1/94 and to make provision in the regional spatial strategy and local development documents for specific numbers of sites and pitches as the noble Lord, Lord Rooker, foreshadowed in our first debate on this subject on 20 January.
The noble Lord has reiterated that stop notices are used only rarely and in extreme circumstances. As Mr Hill, the Minister in another place, put it,
"for an extremely serious breach of planning control".
That is not what the Government say in these amendments. No doubt the Minister will be able to tell the House how many times this "draconian" power—as expressed by a specific district council—has been used since Section 9 of the Planning and Compensation Act 1991 came into effect, substituting new provisions for Sections 181 and 183(1) to (5) of the principal Act. I should like the answer when the Minister replies because the use of the stop notices in the past is some indication of how the temporary notices will be used in the future.
A stop notice may prohibit any use of land, whether ancillary or incidental to the main use of the land. It may prohibit a particular activity taking place on part of the land or intermittent or seasonal use of the land. It may not prohibit the use of any buildings as a dwelling house. I welcome what the Minister said about the extension of that exclusion to persons living in caravans on sites, whether or not they be Gypsies.
In the case of a stop notice issued under the 1991 Act, immediately beforehand the local authority has to issue an enforcement notice which is appealable. While the appeal is awaited the enforcement notice is suspended. The idea of a stop notice was that there were some uses of the land, as the Minister explained, that were so harmful to the community or environment, that for those uses to continue even to the time it took for the appeal to be heard was intolerable. So the stop notice could require immediate cessation of the activity in question with no right of appeal. As the Minister explained, the failure to comply could result in summary conviction and a fine of up to £20,000 or—as he did not say but is the case—an unlimited fine if convicted on indictment.
As the Minister is aware, the ODPM is a listed public body with a legal duty under the Race Relations Act 1976 to eliminate unlawful discrimination, promoting a policy of opportunity and good race

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relations. It is also required to assess the impact of any new or proposed legislation on different racial groups and to consult on the impact that the legislation may have on those groups. Where there would be an adverse impact on a particular group or groups which could not be justified within the wide range of policies then changes would need to be made.
The Commission for Racial Equality is not aware of any consultation having taken place, nor of any impact assessment having been made. It would be unlikely that any such processes could have taken place without the knowledge of the CRE. However, if they did, can the Minister say what impact the ODPM considered these provisions would have on Gypsies and Irish Travellers? It is crystal clear that the temporary stop notices are directed against those communities and not against other serious breaches of planning laws that no doubt occur.
In the absence of any such consideration by the ODPM, the Government have acted unlawfully in bringing the amendment forward. It should be taken away pending consultations with the CRE—which it is seeking—and it should be referred also to the Joint Committee on Human Rights. I drew the attention of the clerk of that committee to the Minister's amendment on March 5, but the committee has obviously not been able to consider the matter and offer its advice. On previous occasions, the committee has repeatedly expressed concern about how little time it is allowed to comment on proposals which may have serious human rights implications and I would be surprised if it does not repeat that concern in this instance. If the Minister has received any letter from the chairman of the Joint Committee on Human Rights, I would be grateful if he would tell the House about it in his reply. If he has not received a letter, perhaps lie could tell us how your Lordships can take into consideration any advice that the committee may give when this stage of the Bill has been passed.
The CRE, Travellers' organisations and the cornrn unities or partnerships which act on behalf of many Gypsies and Travellers have criticised the existing provisions in Section 183 of the principal Act. The CRE expressed concern that the exemption from stop notices of any building used as a dwelling house, but not of a caravan on a site used by Travellers as a dwelling, could be in conflict with the Race Relations Act. It is seeking counsel's opinion, particularly in light of Article 14 of the EU race directive, which requires member states to,
"take necessary measures to ensure that any laws, regulations and administrative provisions, contrary to the principle of equal treatment, are abolished".
I welcome what the Minister said when introducing his amendment; namely, that the regulations would exempt caravans in the same way as dwelling houses. However, it is profoundly unsatisfactory for us to have to rely on some undertaking as to what is going to be in future regulations when what is in the Bill is so clearly discriminatory. That article of the EU directive is reflected in our own law in the Race Relations (Amendment) Act 1976 Amendment Regulations 2003. I would be grateful if the Minister could explain
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what advice he has sought or obtained about the bearing of those regulations on stop notices and, in particular, about the use of stop notices without a preparatory enforcement notice.
I acknowledge that the ODPM is at last addressing the problem of accommodation for Gypsies and Travellers. It is not a moment too soon given that one in five of them in this country is homeless. If the new planning regime set out in the Bill is implemented in accordance with what the noble Lord, Lord Rooker, described previously as the "lead option", a solution is in sight, but it will take some years to achieve, as the noble Lord has acknowledged in moving the amendment.
In the mean time, the proposal will tighten the screw on Gypsies who have nowhere to live because of the 1994 Act and fix in statute the exclusion of the whole Traveller community from the supposed aim of the Government of a decent home for all. My amendment would merely ask the Government to delay the coming into force of those powers until, region by region, they have implemented their own undertaking. I beg to move.
Baroness Whitaker: My Lords, in supporting Amendment No. 143AA, I would like very much to welcome what my noble friend said to guarantee the rights of Gypsies to a home. However, there are difficulties—all those raised so powerfully by the noble Lord, Lord Avebury—but I just briefly want to make two other points. First of all, I should like to ask my noble friend when he plans that these regulations should be in force. If there is any gap between the coming into force of the Act and regulations, you can be sure some local authorities will take advantage of it because that has been the practice of many, but not all, of them.
Lastly, the point of the amendment of the noble Lord, Lord Avebury, is that it gives an incentive to local authorities to provide such sites, whereas, as I understand from my noble friend's rapid résumé of his regulations, caravans will be allowed to remain on site. Now, the site may well not be suitable. It would be much, much better if the local authority had an obligation to find that a proper site existed rather than keep the caravans on a site that was breaching planning requirements.
Baroness Hanham: My Lords, I shall move an amendment shortly, but perhaps I may first make two comments on the Government's amendment. The Law Society has briefed us on it and I shall quickly put forward its points, so that they are considered by the Minister.
First, the Law Society is concerned that the amendment has been tabled at this stage, when the consultation is barely complete. No particular responses have arisen from that. It is hard to see what a temporary stop notice would achieve that a stop notice would not. The Minister has given us some details, but three concerns arise.

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The temporary stop notice is to be issued if the local planning authority "thinks"—we are back to that word again—that a breach has occurred. The corresponding language in the 1990 Act is "where it appears to the" local planning authority to be the case. Does that change of wording bring uncertainty into the provisions? The Minister might like to take some cognizance of that.
Under the existing system set out by the 1990 Act, a stop notice can be issued only following the serving of an enforcement notice. While there is no appeal against the stop notice, there is provision for appeal against the enforcement notice. By contrast, the new provisions offer no appeal against a temporary stop notice despite the fact that non-compliance carries penal consequences. The only remedies available to the recipient of such a notice would be to seek a declaration from the court that the temporary stop notice is invalid.
The provisions for compensation are also unsatisfactory. It is not clear whether a lawful development certificate has to be issued before or after the issue of the temporary stop notice to justify compensation. That is another example of unsatisfactory drafting.
Compensation on the grounds of the withdrawal of the temporary stop notice is of particular concern. As the new provisions stand, the local planning authority can serve and issue a temporary stop notice requiring a particular activity to cease. If nothing else happens, the notice will have effect for 28 days. Presumably, in that time, the authority will have to institute more permanent enforcement action, but there is no requirement to do so. Compensation may be payable where the local planning authority withdraws a temporary stop notice, but not where the notice simply expires at the end of the 28-day period.
Those are matters that the Minister may not be able to address this evening, but if he can, I would be grateful.
Baroness Hamwee: My Lords, as the noble Baroness said, creating a criminal offence, particularly one where there is no appeal, is a serious business. I shall ask a question that arises from the detail of that. Under proposed new Section 171E (4), the temporary stop notice can be served on,
"the person who the authority think is carrying on the activity"—
or,
"a person who the authority think is an occupier of the land"—
or,
"a person who the authority think has an interest in the land".
In other words, the person on whom the temporary stop notice is served may not be the one who is carrying out the activity. Nevertheless, an offence under new Section 171G(1), with penal consequences, would have been committed.
If one thinks of a landlord who does not know what his tenant is up to, one can see why the Government might want to push the landlord to enforce the terms
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of the lease. However, the lease might not be very well drafted. It might not be possible for the landlord to use his own means to make sure that the stop notice is observed. It is hardly a criminal offence to draft a lease. At least, I hope it is not. It may not be possible for the person on whom a stop notice is served, as I read it, to make a third party stop the activity. Again, it may not be possible to have the detail of this debate today, but I do not know whether the answer is that one does not contravene a stop notice within Section 171G if one is in the position I have just described. I would certainly like to know the answer at some point.
Lord Lucas: My Lords, while I found myself entirely in sympathy with the objectives of the noble Lord's administrative amendments, I have great doubts about the drafting, and about the implications. The very idea that it should be possible to deprive someone of his home just by sticking a notice on a telegraph pole outside it, and that he and his family should then have immediately to quit that home without any sort of appeal, does not square with justice, or indeed the Human Rights Act. I cannot see how that could even be contemplated under this sort of legislation.
I have great doubts, too, about doing this to a business. If the local authority can effectively close down a business if it thinks it contravenes planning obligations, it then only has to pay compensation if, under Section 171H(1)(a), the activity that is specified is actually authorised by planning permission. But what if it is something that does not require planning permission, and the local authority just made a mistake? Under those circumstances it would seem that there is no compensation available, and certainly no mechanism for someone who has their business closed down in this way to take action to get the mistake rectified. It seems to me to be leaving citizens without access to justice in a way that we have been familiar with under this Government recently. but which I find entirely reprehensible.
As far as the amendment of the noble Lord, Lord Avebury, is concerned, I support it entirely. I shall admit to a couple of romantic reasons for doing so. I grew up on a farm that employed a large number of Travellers at harvest time, and I was an avid reader of Tintin and an admirer of Captain Haddock, so I am a great believer in the rights of Gypsies and other Travellers to live among us, and in our obligation to make the necessary provisions to make that possible. It is something that the general community often finds inconvenient, as it does with providing proper accommodation for other activities that most people find inconvenient, but which are none the less lawful. It is something that the Government ought to do. These things are very difficult to resolve at local level. It is up to the Government to place obligations on local authorities and others to make these provisions, so that we can all share the burdens fairly, as it does with airports. That seems to me to be a central function of Government. Something that allows a particular community to be victimised just because they are

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inconvenient to other people, and no provision has been made for their proper accommodation, seems to me to be entirely unreasonable.
Lord Rooker: My Lords, if I might say so, I think that speech was unreasonable as well. I exempt the noble Lord, Lord Avebury. However, if I were from another planet, I would know that all the speeches I have just heard were from people who have never been in the other place, for a start, and have never had to deal with their constituents when they are beside themselves because someone has done something in flagrant breach of planning permission. In other words, I have just heard four or five speeches basically saying that anything goes. That is not what we are doing.
Baroness Hamwee: My Lords—
Lord Rooker: My Lords, I know I wound the noble Baroness up. I intended to, to be honest, because I think some of the points that have just been made are wholly unreasonable. True, I may have rabbited on with my notes a bit too fast. Some of the things I have been criticised for not saying, I actually did say in the speech—they are in the notes, to which I stuck very carefully, because of the importance of this issue. But if the noble Baroness insists on getting up, naturally I shall give way to her.
Baroness Hamwee: My Lords, I am far from actually wound up, but I want to explain that it is not only Members of Parliament who have to deal with wound-up and agitated local residents who get very upset about what their neighbours are doing. I am sure that the noble Baroness, Lady Hanham, and I have both, in our local government careers, had the experience of having to deal with such residents. I make that point not to claim particular experience, but to say that the experience is shared. I hope that the Minister would understand that, to put it in the vernacular, where some of us are coming from is perhaps not where he thinks we are coming from.
Lord Rooker: All right, my Lords. I am well aware of councillors who get phone calls from local business on small factory estates who arrive on a Monday morning and find that none of the 20 enterprises can get on to the car park, because on the previous evening it has been totally occupied by a load of other people. They get the phone calls just the same—that is what I am pointing out. There is a real world out there, and some of the speeches I have just heard ignore what we are actually doing to help the section of the population against whom we do not want to discriminate. I am going to answer all the points. It is important, bearing in mind the lateness of the issue coming before the House, and naturally I accept that point, and also the fact that we have only Third Reading still to come.
We have already said, and I do not want to repeat it, that a review of the policy for circular 1/94 is being undertaken, including the revision. Indeed, Ministers will be meeting Gypsies and Travellers and their
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representatives, as well as the Commission for Racial Equality and local authorities, to hear their views. We are fully engaged with the Gypsy and Traveller groups, hence the series of seminars, and they will be consulted on the regulations. Those regulations will be designed to protect Gypsies and Travellers; I make no hones about that, and I made that point earlier on.
The powers are general and discretionary, and we said that we expect local planning authorities to use these powers reasonably, responsibly and proportionately. I also said in my speech that the proposed regulations will offer similar protection to those in caravans as to those in bricks and mortar, and will ensure that their home is protected. So the nonsense I heard in one speech about a local authority coming along and kicking people out of their home would not be proportionate in any event. That is extravagant language that sends completely the wrong signal to those outside about what we are seeking to do.
Regarding stop notices, there is a problem: a temporary stop notice can only go with an enforcement notice. I explained that the practicalities of getting an enforcement notice mean that it can take months before any action can be taken. There were 183 stop notices issued in England in 2002. We are not aware, although that is not to say that it has not happened, of any of them being used against Gypsies. We do not have any information on that, but certainly no notices have been brought to our attention as being served against Gypsies and Travellers.
The powers will not commence until the regulations are in place, and the regulations will protect the Gypsies and the caravan dwellers—not every caravan dweller classes themselves as a Gypsy. There is nothing illegal about being a nomad. I make that absolutely clear, I have said that before, and that is our position.
The temporary stop notice refers to a situation where the local planning authority thinks—and we are going to come to that later on; we have done a word search on the computer about the number of times "thinks" appears in legislation, and, I can tell the noble Baroness, it is quite a lot—a breach has occurred, whereas a stop notice under the 1990 Act is slightly different. The wording makes it clear that the local planning authority has the discretion to decide whether it is appropriate to issue the temporary stop notice. Our legal advice confirms that the provisions are not in breach of the Human Rights Act, although ultimately it is for the courts to interpret the provision and decide if any action of a local planning authority is to be challenged. However, we would not be proceeding if our legal advice were to the contrary, so I hope we are secure in that.
We are keen to encourage Gypsies and Travellers to make more provision for themselves, providing it complies with planning regulations. That is not a contradiction. In recent years, the number of caravans on authorised, private and owner-occupied sites has risen by 1,245 since 1997, around 130 per year. That is a considerable contribution to addressing needs. Private provision now stands at approximately 4,800

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spaces, up from 1,000 when the caravan count started in 1979. On the other hand, unauthorised developments have more than doubled since July 2000, rising from 803 to 1,664 in July 2003.
I shall deal with the impact assessment on Gypsies and Travellers. There has been ODPM consultation, and consultation by the Commission for Racial Equality with Gypsy and Traveller groups. Let us deal right away with the idea that we have not done anything on the subject. I do not expect people to come along and say "Thank you", but we have to date made £33 million available via the Gypsy sites refurbishment grant to bring underused sites and local amenities back into action and improve the quality of life for residents. The grant now provides funding for authorities to create new transit and stopping places for Gypsies and Travellers.
Provision for compensation will be dealt with in the regulations. The intention is that they should replicate the current provisions. Therefore, clarification of how and when to claim compensation will be in the regulations.
A point was made about there being no right of appeal to the Secretary of State against the issue of a temporary stop notice. The remedy available would be judicial review of the local planning authority's decision to issue the temporary stop notice. Any person affected by the temporary stop notice would be able to exercise other rights under planning legislation. The person would be able to apply for retrospective planning permission for any development that had taken place under Section 73A, and for planning permission in relation to further proposed development. Alternatively, of course, the person may apply for a lawful development certificate where it is considered that the development is indeed lawful.
There is no blanket ban. We are not sticking a note on a pole outside people's homes telling them to leave those homes—far from it. We are genuinely attempting to: meet the needs of people who are discriminated against—I make no bones about that—because of the changes in legislation in the 1990s; to make proper provision for Travellers and those who live a nomadic existence; and to encourage them to make better provision for themselves, in conformity with the regulations. There is no attempt to allow local authorities simply to put up a stop sign and say, "No more Travellers here". It would be quite unacceptable for anyone to seek to do that, because it would not be proportional or a reasonable use of the policy.
As I said, the regulations will be fully consulted on with those affected by them, with an attempt to get regulations that will work and be practical, and that will be helpful in protecting people who do not have sufficient protection under present legislation. That said, I hope that the amendment that I moved, with its proposed new sections, can be part of the legislation. My point about it still stands: we want to put the support in the regulations rather than in the Bill. It would be done after consultation anyway, and there will be plenty of that to come.
8 p.m.
Lord Avebury: My Lords, I do not want to delay your Lordships, as I know that there is important business to come after our debate. I shall say only that I am not aware of the consultations in which the ODPM engaged, which the Minister mentioned, and the CRE is not either. It believes that some aspects of the amendment are in breach of our obligations under the Race Relations Act. The best thing for me to do is to withdraw my amendment at this stage, consult the CRE, and perhaps to come back at Third Reading. Before I do so, I thank all those who have taken part in the debate, particularly the noble Baroness, Lady Whitaker, and the noble Lord, Lord Lucas, who spoke in support of my amendment.
I shall conclude by asking the Minister whether he can signify, perhaps by nodding, whether the regulations exempt those who live in caravans on exactly the same basis as those who live in ordinary bricks-and-mortar houses from the applications of stop notices. Will that be read back into the stop notices under the 1992 Act, as well as applying to the temporary stop notices to be issued as a result of the Bill? It would be very incongruous if the Minister were to say that that was not the case. In spite of the fact that he said that he was not aware of any stop notices being used against Gypsies in 2002, if temporary stop notices could not affect people residing in caravans if there were a prohibition on using temporary stop notices against people who lived in caravans but the regulations did not read that back into the original stop notices that accompanied enforcement notices under the 1992 Act—local authorities might be persuaded to use the original power in preference to the temporary stop notice.
Lord Rooker: My Lords, that is a very fair question to ask and I have no way of answering it, off the top of my head. It might sound reasonable in one sense, but I do not know; I would have to take advice on it. I shall certainly get some advice before Third Reading. The present stop notices can be issued only after the enforcement notice procedure, which is a different kind of procedure. Whether that concession can be read back from the temporary stop notice into the current stop notice is a misuse of the terminology in a way. They are both called stop notices, but we are talking about something where the process is completely different. I shall have to take advice, but it is a wholly reasonable question to ask.
Lord Avebury: My Lords, I am grateful to the noble Lord. Perhaps we can be in touch, even though it is a very short time before Third Reading. If we can have the answer to that question before we make a decision on whether to table another amendment for Third Reading, that would be most helpful. With that, I beg leave to withdraw the amendment.
Amendment No. 143AA, as an amendment to Amendment No. 143A, by leave, withdrawn.
Baroness Hanham Baroness Hanham moved, as an amendment to Amendment No. 143A, Amendment No. 143B:
Line 89, leave out "by the local planning authority" and insert "or granted"
The noble Baroness said: My Lords, I can deal with the matter quite quickly, because I appreciate that noble Lords want to get an Unstarred Question started. I thank the Minister for what he said, which was that he would look at Amendment No. 143B carefully, and perhaps that we would come back to it a later stage.
Amendment No. 144 returns to a matter that we introduced before. It relates to stop notices and would give local planning authorities a power to remove objects, not including buildings, used for prohibited activity from land if that activity were a breach of a stop notice. We gave an example last time that caravans could be removed, and we had a big discussion on that. Where the activity was the unlawful construction of a building, for example, builders' equipment could be removed, and where noisy or un-neighbourly activity starts up, a local authority would be able to remove the troublesome equipment. Many noble Lords are aware of what goes on in barns, sometimes with parties and late night activities. It applies only in circumstances where criminal offences are committed, although there is no need to bring a criminal prosecution.
The amendment is a revision of the amendment discussed in Committee. We have removed the amendments to Section 178, which are not critical to what we are seeking to achieve. The new stop notice clause, Section 186A, is a most important provision. I want to explain why it is needed, because the noble Lord. Lord Bassam of Brighton, said in Committee that,
"local planning authorities have powers under Section 178 of the 1990 Act to enter land and take the steps required to enforce the notice and to remedy the situation. A stop notice can be served only on the back of an enforcement notice and must relate to the activity prohibited. Breach of that notice will mean in most instances that the enforcement notice has also been breached, and the powers of entry which were associated with the enforcement notice would be available, therefore, to the planning authority".—[Official Report, 5/2/04; col. 867.]
Unfortunately, I am advised that that explanation was not correct. The purpose of the enforcement notice is to require a person to remedy a breach, or cease an unlawful activity. An enforcement notice only takes effect—the Minister said this earlier on—when an appeal has been concluded. No breach can arise until after that stage. The purpose of a stop notice is to require an activity to cease before an enforcement notice takes effect. Indeed, under Section 184 of the Town and Country Planning Act 1990, a stop notice will cease to have effect when the enforcement notice takes effect. The Government are wrong to say that there can be a simultaneous breach of a stop notice and an enforcement notice. At the later stage when an enforcement notice is breached, the local authority can then go on to the land under Section 178 and end the breach. If a stop notice is breached, the local planning
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authority does not have that power to go on to the land under Section 178 and stop the activity. Section 178 does not provide an adequate remedy.
This is the difference between enforcing the enforcement notice and stop notice regimes. Given the harm to amenity, which often provokes the issue of a stop notice, a power for local authorities to go on to the land quickly and end the breach will give the lead to hard-pressed local residents. Planning injunctions can be sought under Section 187B, in respect of any breach of planning control. Such injunctions are sought relatively infrequently and usually after criminal proceedings have been brought. There is a cost to local authorities in seeking them, which in practice may not be recoverable, and hearings can take time to come on. Additionally, injunctions will only be granted where a court is prepared to gaol a person who breaches the injunction in contempt of court.
The availability of injunctions does not make enforcement notices or stop notices unnecessary or duplication. The Town and Country Planning Act 1990 contains all these remedies. It also does not answer the need for effective, quick, on-site enforcement mechanisms for stop notices. Rather than pursue slow criminal or civil proceedings when a stop notice is breached, the local authority should be able to take steps to remove objects to shut down the activity. That is the purpose of the amendment. I beg to move.
Lord Rooker: My Lords, I do not want to be too repetitive, but I gave an answer on this. My advice is that the words of my noble friend Lord Bassam of Brighton are correct. There is a dispute about the interpretation, and I will have to take the views of my learned friends in the Box behind me that we are right on this.
I made the point that we are sympathetic to the aims behind this amendment, but in fact it duplicates the powers of the enforcement notice in the existing stop notice. That will not stop the problem of stopping unauthorised development, or intensification of the use of the land in the first 28 days after the breach has occurred. That is why the introduction of the temporary stop notice is a solution to that problem. I am not saying that it is perfect, but that is the way to do it. The powers are already there for local planning authorities to enter land and take steps to require by the enforcement notice to remedy the situation. They recover from the person who is the owner of the land any expenses.
Although both the enforcement notice and the stop notice set out details of the activity or development that must cease, it is the enforcement notice that gives details of the remedial action that must be taken, not the stop notice. There is a dispute here about interpretation of the current legislation. Obviously, I will take further advice between now and Third Reading. The better way to solve the problem is t he use of the temporary stop notice, which was the subject of the four new clauses that I moved.
Baroness Hanham: My Lords, I thank the Minister for that reply. We are slightly at odds here; my advice

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is certainly that a temporary stop notice will not do sufficiently what my amendment does. I wonder whether the Minister would be kind enough between now and Third Reading to meet me to discuss it so that we can assess where our differences lie. I do not think that they are great, but this is an important issue.
Lord Rooker: My Lords, I certainly will.
Baroness Hanham: My Lords, I thank the Minister. I beg leave to withdraw the amendment.
Amendment No. 143B, as an amendment to Amendment No. 143A, by leave, withdrawn.
On Question, amendment agreed to.
Lord Bassam of Brighton: My Lords, I beg to move that further consideration on Report be now adjourned. In moving the Motion, I suggest that the Report stage begin not before 9.15 p.m.
Moved accordingly, and, on Question, Motion agreed to.

Abortion
8.15 p.m.
Lord Alton of Liverpool Lord Alton of Liverpool rose to ask Her Majesty's Government whether they will review the provisions in statute that permit conditions such as cleft palate and cleft lip to be regarded as "serious handicaps" for the purposes of terminating the lives of the unborn after 24 weeks' gestation.
The noble Lord said: My Lords, I am grateful for the opportunity to raise the issue this evening in this short debate. I am grateful to those members of your Lordships' House who are to participate in the debate; and I am especially grateful to the most reverend Primate, who is here for our proceedings.
In 1967, Parliament decided that a pregnancy could be terminated by a registered medical practitioner if two registered medical practitioners were of the opinion, formed in good faith, that there was a substantial risk that if the child were born it would suffer from such physical or mental abnormalities as to be seriously handicapped.
Subsequently, in 1990, Parliament decided to extend that provision, authorising abortion up to and even during birth on those who would otherwise he born with serious disabilities. In almost every other instance, the legal time limit for abortion is 24 weeks. I recall that debate well, having spoken strongly in another place against what I believed to be a discriminatory provision. Tonight's debate provides an important opportunity to highlight the fact that many conditions that are not serious handicaps and were not intended to be covered by the 1990 amendment to Section 1(1)(d) of the Abortion Act are now being used to justify abortions.
Disability rights groups, such as the Disability Rights Commission and Disability Awareness in Action, are extremely concerned about the application
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of Section 1(1)(d) and the way it reinforces discrimination against people with disabilities. These are its words:
"The Section is offensive to many people; it reinforces negative stereotypes of disability and there is substantial support for the view that to permit terminations at any point during a pregnancy on the ground of risk of disability, while time limits apply to other grounds set out in the Abortion Act, is incompatible with valuing disability and non-disability equally".
I recognise the Government's commitment to eradicating discrimination against people with disability and especially welcome the draft Disability Discrimination Bill. But there really is not much point in insisting on loop systems or ramps for public buildings if the law is to be used to deny a disabled person the right to life itself—and specifically to treat disabled people in statute differently from the able-bodied. I hope that when the Minister replies, he will tell us whether the Government intend to use the opportunity of the draft Disability Discrimination Bill to address the concerns of the Disability Awareness in Action group and the Disability Rights Commission—and, indeed, to eradicate eugenic abortion.
In the years 1968 to 2001 inclusive, 4.56 million reported abortions were performed on residents of England and Wales. Of those, 63,897, or 1.4 per cent, were performed under Section 1(1)(d)—cases in which there was a substantial risk that if the child were born, it would suffer from such physical or mental abnormalities as to be seriously handicapped. As the Government acknowledged in a Written Answer in the other place on 30 January this year, the term "seriously handicapped" has not been interpreted by any court decisions.
Since 1990, when the law was amended to allow post 24-week gestation abortions for disability, the number of abortions performed under Section 1(1)(d), as amended, has increased substantially. In 1990, there were a total of more than 1,601 such abortions; 21 after the 24 weeks' gestation. In 1995, those figures had increased to 1,828; 63 after 24 weeks' gestation. In 2002, a total of 1,863 abortions were performed for disability, of which 110 were after 24 weeks' gestation. So there has been an inexorable rise.
A closer analysis of those disturbing figures proffers further cause for concern. The annual abortion statistics include a table setting out the various conditions for which abortions under Section 1(1)(d) have been performed. Looking at the 2002 statistics, I was shocked by the vague nature of the classification. For example, in 2002, 83 abortions were performed for "other malformations of the brain", 19 of which were performed after 24-weeks gestation. Four abortions were performed for "eye, ear, face and neck" malformations. Thirteen post-24-week abortions were performed for "malformations of the cardiovascular system", whatever that may mean. Nineteen abortions were performed for malformations of "the respiratory system"—again, extremely vague—four of which were after 23 weeks' gestation. I could go on.
This vague classification is simply not good enough. When unborn lives are terminated for disability, the least that we should expect is a proper explanation of

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why. Do the Government have any plans to oblige doctors performing abortions under Section 1(1)(d) accurately to state the nature of this "serious" disability?
This is an issue to which I am returning. In 1990, in another place, I moved an amendment to require the nature of the disability to be stated on the green form. That was defeated on the casting vote of the Speaker of the House because he had to uphold the status quo, that being the tradition in the other place. I believe that it is now timely to return to this issue, given the experience in the mean time.
The number of post-24-week gestation abortions for disability has risen exponentially since 1990. As it is now generally acknowledged that after 24 weeks the unborn child is sentient and, if born prematurely, viable, one wonders whether the growing practice of post-24-week gestation abortion for disability is contrary to Article 2 (the right to life) and Article 3 (the right not to be subject to inhuman and degrading treatment) of the European Convention on Human Rights, which the Government have properly incorporated into UK statute. I hope that the Minister will set out what advice the Government have received on that point.
Since 1996, the Royal College of Obstetricians and Gynaecologists (RCOG) has published guidelines on the termination of pregnancy for foetal abnormality. According to the RCOG, a person is to be regarded as seriously handicapped only if he needs the support described in points 3 and 4 of the World Health Organisation's scale of the severity of disability. Point 3 refers to "assisted performance"; that is, the need for a helping hand. Point 4 refers to "dependent performance"; that is complete dependence on the presence of another person.
How can it be said that those unborn children with, say. Down's Syndrome, of whom six were aborted at post-24-weeks gestation in 2002, or those children with malformations of the "eye, ear, face and neck", fall within the RCOG's and the WHO's definition of "seriously handicapped"? In the case of Re B (A minor) (Wardship: Medical Treatment) [1981], the courts held that it would be unlawful to withhold treatment to remove an intestinal blockage from a child with Down's because there was no evidence that it was in the child's best interests to die. If the courts regard the Down's child once born as not falling within the WHO's definition of disability, surely the same logic should apply to the Down's child in the womb.
According to the RCOG, one factor to be considered in assessing whether the unborn child would be seriously handicapped is the remediability of the condition. So how is it that over the past six years, 26 babies have been aborted because of suspected cleft lip or cleft palate, one after 24-weeks' gestation?
In its own guidelines, the RCOG states that when certifying that there is a "substantial risk" of "serious handicap", medical practitioners,
"should bear in mind that the risk should also be likely to be considered substantial by informed persons with no personal involvement in the pregnancy and its outcome".
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Note the use of the word "informed".
Having spoken to medical practitioners, I understand that current medical practice is such that obstetricians and gynaecologists do not refer to specialists in the condition from which that child suffers. It is therefore doubtful whether they can obtain an accurate view about whether the child has a serious handicap in any event. For example, when faced with a possible diagnosis of cleft palate, how many obstetricians and gynaecologists call in a specialist in cleft palate for an opinion about its severity? Perhaps the Minister will tell us today or, at least, promise to find out.
The terms cleft lip and cleft palate are used interchangeably, including in the abortion statistics, but of course there is some difference. They are not life threatening conditions. Many noble Lords know people with a cleft palate. I have a teenage godson with that condition. It would be absurd to argue that someone like him should have been denied the right to life.
In June 1990, when the other place was considering extending the Abortion Act to allow abortion up to and including birth, my colleagues and I received a legal opinion from Professor John Finnis and Professor John Keown, both of whom at the time were at Oxford University.
Both Professor Finnis and Professor Keown warned that the proposed legislation would lead to abortion until birth in a disturbingly wide range of cases and that,
"some doctors will interpret the onerous conditions that apply to them as including a hare lip or a cleft palate".
I was accused at the time of being irresponsible for suggesting that would happen. The evidence now demonstrates that it has happened and is a reality.
We need to look at this issue again. I am glad to say that I am not alone in holding that view. I refer your Lordships to Early Day Motion 186 in another place signed now by 54 Members of the House of Commons—from the Labour Party, the Conservative Party, the Liberal Democrats, the Ulster Unionists, the DUP and Plaid Cymru. That is an extraordinary range of people, which also includes Dr Jenny Tonge, Dr Vincent Cable—with whom I would not agree on these particular issues—and, yes, people like Miss Ann Widdecombe and Kevin McNamara, but also Gerald Kaufman and a range of people who would certainly not normally take what might be regarded as a so-called pro-life position.
So I think that there is a mood in the country, questioning why it is that in these specific circumstances we are permitting abortion up to and even during birth on a child with very minor abnormalities and disabilities. It is time that we looked at these questions again, and I am grateful for the opportunity this evening of being able to raise this question in your Lordships' House.
8.26 p.m.
Baroness Masham of Ilton: My Lords, I thank my noble friend Lord Alton of Liverpool for bringing this very alarming matter to the notice of your Lordships today.
I must admit at the start that I find abortion at any time and for anyone, especially the most vulnerable, a very disturbing situation. But today we are speaking of a more specific situation and of the law. It seems that there is no definition in law of the term "serious handicap". While the situation means that doctors can and do abort on the grounds of any condition, to press for a definition of the term "serious handicap" would in effect be to sign the death warrants of those babies who fall within the definition; for instance, many with Down's syndrome or spina bifida.
Many disabled people are painfully aware that in this country doctors can abort on grounds of "serious handicap" at any time up until birth. This situation is one which clearly discriminates on the grounds of physical or mental ability. The Disability Discrimination Act came into force in 1999, and yet discrimination on eugenic grounds—
"making a pure and perfect human race"—
has got worse. I do not think that many of the public realise that disabled babies can be terminated after 24 weeks and up to full term. After all, 24 weeks is almost six months.
One of my secretaries was born with a cleft palate. She was operated on. She is a splendid girl, full of vigour, and enjoys life to the full. I am sure that many of your Lordships know people who have been born with cleft palates or hare lips. With microsurgery and surgeons' skills we are talking now of something which can be corrected. Some time ago a paediatric plastic surgeon told me that he was concerned that he was not getting enough babies with cleft palates each year to keep in best operating practice. He needed about 30 babies to operate on each year but this figure had dropped because they were being aborted.
Modern society seems to want only the perfect—designer clothes, designer babies, the immaculate fridge. There is also a growing danger of other people judging the quality of life of those they think will not have as good a life as they have themselves. Is that not playing God?
I hope that tonight's Question will alert some people who may not have realised how far down the road of discrimination we have gone, with regard to the unborn child who may or may not have a handicap.
8.30 p.m.
Lord Chan: My Lords, I thank my noble friend Lord Alton of Liverpool for securing this debate on what I consider an ethical issue connected with pre-natal diagnosis. Abortion of the seriously handicapped would not be possible without pre-natal diagnosis. I shall take a little time to trace the history of such diagnosis.
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Pre-natal diagnosis of the foetus in the mother's womb was first introduced when pregnancies failed because of rhesus blood group incompatibility between the mother and her unborn baby. The mother would be rhesus-negative and her foetus rhesus-positive. With every subsequent pregnancy, the rejection of the foetus due to antibodies in the mother became more severe. The remedy of that condition, which produced premature delivery and death of the baby, was pre-natal diagnosis, measuring maternal antibody levels during the pregnancy and intervening with blood transfusion for the anaemic premature foetus. The lives of ill unborn babies were saved by pre-natal diagnosis and timely treatment with blood transfusion. That technical advance, introduced between 1949 and the early 1950s, led to other developments that could diagnose foetal congenital defects of the developing spinal column or neural tube, particularly severe spina bifida with paralysis of the lower limbs. As a consequence, some—if not most—such unborn babies were aborted, more so after the legislation of 1967.
We know that, although parents favour physically normal babies, groups of people with severe birth defects—the Disability Consortium—remind the public regularly that they are glad to be alive and lead a meaningful life in spite of their disabilities. The Government's disability discrimination legislation also supports the idea that disabled people lead and can enjoy a meaningful life.
Today, pre-natal diagnosis, which was introduced to save the life of ill babies, is being used so that mothers and fathers can decide to terminate the life of their unborn baby. Of course, in most cases of abortion or termination of pregnancy, the unborn foetus is physically normal.
In best practice, women who ask for and are offered pre-natal diagnosis should also be offered counselling. There are some defects of the developing foetus that can be diagnosed by routine ultrasound scan. Cleft lip and palate is one such diagnosable defect. Cleft lip and palate are eminently treatable by maxillo-facial surgeons in the NHS. There is no waiting list for the operation. The results of surgery are usually excellent, if performed on a young baby who can develop not only normal speech but acceptably good looks.
The issue is that doctors are expected to counsel patients who request termination of pregnancy on the ground of serious handicap. As my noble friend said, the number of terminations involving cleft lip and palate has increased. Could all of those unborn babies have severe chromosomal abnormalities with cleft lip and palate? I notice that, in 2000, nine foetuses with cleft lip and palate were aborted before 24 weeks. There are severe abnormalities such as trisomy E or Edwards' syndrome that would be considered for abortion. However, if the affected babies were allowed to progress to birth, some would have died soon after birth, and the rest would have succumbed within months. Therefore, it would be of interest if more details of the diagnosis of these cases could be obtained rather than the vague descriptions read out by my noble friend Lord Alton.

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There was one case of the termination of pregnancy after 24 weeks of gestation which took place in 2001. I fear that the priority of patient's choice might lead to more abortions and the termination of pregnancy for reasons such as cleft lip and palate. This is an issue of concern to all of us, but if it is not, it should be.
8.35 p.m.
Lord Stoddart of Sh indon: My Lords, I cannot bring to this debate the expertise of the noble Lord, Lord Chan. who has just spoken, but I can join him in thanking the noble Lord, Lord Alton, for raising this very important debate tonight on cleft lip and cleft palate. He might be surprised that I am taking part in the debate on his side because he will know that my previous position on abortion has always been to support the 1967 Act, known as the Steel Bill.
Looking back to the debate at that time and my subsequent actions in another place, especially when I was a Government Whip. it seems to me that we have gone a long way from the intentions of the 1967 Act. Those of us who supported it believed that we were supporting a Bill to outlaw back-street abortionists, for example, which was good, and to protect women's health and welfare and the prevention of severely disabled births where there was no prospect of any viable, decent lifestyle. Those were the bases on which we made up our minds.
But we have gone a long way beyond that now. When I have read articles about cleft palates and cleft lips, I have realised that it is time to re-examine what we are doing as regards abortion and severe disablement. That is why the debate tonight is timely. We have gone beyond what we thought we were doing. We now have virtually abortion on demand. We have a woman's absolute right to have an abortion irrespective of other interests and the interests of other people. I believe that we have come a long way too far.
When I was supporting these measures I did not dream that we would reach a figure of 155,000 abortions every single year. That is an enormous number. It is almost the same number of people that the Government say we are short of and wish to allow to immigrate into this country to work. We are allowing the abortion of 155,000 souls every year.
We have now reached a new, alarming situation where viable foetuses which could live a good and useful life—perhaps even be geniuses—are killed unnecessarily. They could live a viable life if allowed to be born. I believe that it is now time to revisit the whole issue of abortion. I am going rather further than the noble Lord, Lord Alton. Perhaps it is people like myself who should be saying that at this time. I believe that we have gone too far and that now is the time to look at things.
In case I am accused of being too old to have decent opinions, I want to say that age brings experience and knowledge. Furthermore, I hope that I will not be accused of being some sort of religious maniac, because I am not. I am completely irreligious. I am sorry to say so when the most reverend Primate is sitting in front of me, but I am sure that he will
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appreciate the honesty with which I speak. I support the noble Lord, Lord Alton. and thank him again for bringing forward the matter.
8.40 p.m.
Lord Tombs: My Lords, I thank my noble friend Lord Alton for giving us the opportunity to debate this important topic. The subject of late-term abortions is distressing for babies, parents and doctors alike. They differ from early abortions in that the aborted child is fully formed and has survived the normal hazards of pregnancy to come within reach of an independent existence. The arguments so often advanced, that the foetus is not recognisable as a human being and so should not enjoy the rights of a human being, do not apply here. Post 24 weeks we are speaking of a baby with a chance of survival. Its form and behaviour are those of a human being, but denial of its life is the objective of abortion.
The argument that such extreme action is justified by the prospect of severe disability is questionable on the simple grounds that many people with severe disabilities lead happy and fulfilling lives. We would not consider denying that to an adult, so on what grounds can we reach a contrary conclusion in the case of a viable baby? I am afraid that the answer lies in the old saying, "Out of sight, out of mind". It is possible, with the help of doctors, to avoid confronting the enforced termination of life in a brutal fashion that would certainly not be tolerated in the case of a visible adult.
However, the slippery slope, aided by concealment, leads to passive acceptance of the unseen and a growing practice of it. Again, the old saying, "Familiarity breeds contempt" has led to a steady growth in post 24-week abortions over the past 10 years, although the total number of abortions has fallen slightly in that time and the number of those performed on the grounds of diagnosed disability has remained fairly constant.
Many of us oppose the death penalty on the understandable grounds that errors cannot be redressed. Such an attitude is based on respect for human life but is denied to the undelivered baby by legislation and by growing practice. A comprehensive study of autopsies on late abortions due to diagnosed abnormalities shows a confirmation rate of 72 per cent. That is a pretty good figure, given the diagnostic difficulties, but it shows that diagnoses are not infallible and that the irrevocable step of terminating a life is taken without the benefit of the doubt being given to the child. Whatever happened to the notion that society does not have the right to destroy life, which is so apparent in the treatment of convicted murderers?
The decision on late abortions is hazardous, depending largely on the attitude of the mother as interpreted by her doctors. It is in the nature of things that such decisions rest on a large measure of individual judgment. It is highly unsatisfactory that legislation offers so little guidance. The slippery slope therefore becomes inevitable. Every violent death

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diminishes society, and never more so than when it applies to an innocent child subjected to brutality sanctioned by the law. Such brutality brutalises society itself, and we have a plain duty to avoid it.
It is beyond question that many prospective parents are deeply disturbed by the prospect of having a disabled child. The fact that many parents survive it and that they and their children share a happy life together does not remove the mental anguish which some parents believe to be beyond them. In such cases, the answer must lie in state provision of support to the parents, often sadly lacking in today's society. In so far as such help is not available, the state is an accomplice to the brutality that I have described. I hope that the Minister will address that problem when he replies.
8.45 p.m.
Viscount Craigavon: My Lords, I was hesitant about the merits of this debate, and it has turned into something very different from what I thought it was going to be. I paid the noble Lord, Lord Alton, the compliment of reading what he had put on the order paper, which largely mentions cleft palates and cleft lip, particularly after 24 weeks. So that is what I have addressed. Partly for those reasons, people who might be expected to speak on the same side as myself in a debate like this have decided not to attend.
I compliment the noble Lord, Lord Alton, on not using this debate to comment on a case which is going through the courts, which I thought he might be going to do. We are in the middle of litigation, and I suspect that this amendment might have originally been put down to further that cause. It is absolutely proper that we are not discussing it today, but, as background to some of my remarks, that had featured in my expectations.
In his introductory speech the noble Lord, Lord Alton, he went very wide of what seemed to be on the Order Paper. I am all in favour of having debates in this House on abortion and anything to do with it, but I think it is discourteous not to give the House proper notice of when that is being tried, and trying to do it in a dinner hour debate is slightly counter-productive. I do not know whether he gave Front-Bench spokesmen notice that this was what he was going to do, but it certainly did not come to my notice.
I am concentrating, in a very short time, on cleft lip and palate and in particular post 24-week abortions. I first remind the House that cleft palate and lip is not a simple syndrome. There are two aspects. First, it can often be associated with severe congenital abnormalities. Secondly, in cases where there is just a cleft lip or palate, there are degrees of severity, with some of the more serious not being amenable to surgical repair. I have the greatest respect for the noble Lord, Lord Chan, and noticed that he used the word "usually", in the context of being usually treatable. I take his point. All that adds to the uncertainty of what has been diagnosed in a particular case. I put all this in the context of the prevalence of a case such as one
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referred to in the Motion, that is post 24-weeks in cleft palate and lip. The Office for National Statistics's figures show that since 1999 there has been only a single case, in 2001, of a termination post 24-weeks for cleft palate. It is unfortunate that this single case must be assumed to be the one which is subject to all this publicity, and the subject of the legal case which we have read about in the papers.
In 2002, the last year for which figures are available, there was one pre-24-weeks case for cleft palate. Similarly, in 2001, there was one other case which was pre-24-weeks. Our attention on what I thought was going to be the Unstarred Question today is focused on the fact that there was one such termination out of over 186,274 abortions in 2001. That is also the sole recorded case post 24-weeks in the last four years. I was questioning whether that was an appropriate subject for a parliamentary debate, to take up the time in the way that we are. As I say, I am very happy to have a more general debate on abortion.
Present abortion legislation was last decided by substantial majorities in both Houses in 1990. The noble Lord, Lord Alton, used the word "eugenic" which I do not think is a parliamentary word to attach to statutes which Parliament has passed. I am not asking him to withdraw it. He did actually use it on the Order Paper of this House. Fortunately, he was persuaded to withdraw it, because it was completely out of order.
It was agreed by Parliament in 1990 to leave the wording relating to grounds in the Act to be interpreted by the doctors involved, in discussion with the patient. One of the changes following the 1990 Act was that all terminations post-24 weeks could only be performed on NHS premises. That is an additional safeguard. It has been the practice under this system that decisions are taken in clinical discussions with the woman. That has served us very well.
In cases such as those mentioned in the Question, none of us knows the circumstances that persuade a woman and her doctors that abortion is the best option in her particular case. I am therefore not persuaded that there should be a review by the Department of Health on this particular aspect of abortion law.
8.50 p.m.
Lord Clement-Jones: My Lords, I, too, must express gratitude to the noble Lord, Lord Alton, for giving us the opportunity to discuss some of the issues raised in the debate. Those issues have broadly been raised in an extremely dispassionate and rather forensic way, which is welcome. I have some qualms about the timing of the debate because some of these matters will soon be tested in court. I would have preferred to have the debate after those issues had been tested. Perhaps the remedy is simply to have another debate when we know what that decision is.
Although I am a longstanding pro-choice supporter who certainly supports the terms of the 1967 legislation of my noble friend Lord Steel, I am also one who believes that the legislation should operate memberconstituency

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intended and not as some kind of lifestyle choice. There has been much debate on this issue in recent months, inspired by the case that we cannot discuss. In some ways, I admire greatly the journalists who have commented on the issue and the facts surrounding it because they have been able to adopt a degree of certainty that I am not able to share. I certainly do not feel the degree of certainty about the issue which they have expressed, largely because each case must be different on its facts. Without the real facts, I refuse to censor. Without the facts I cannot criticise the current state of the law.
As the term "serious handicap" is not legally defined—which is highly regrettable; it should be—future events in court should be welcomed. Moreover, there must be a consideration of the kinds of responsibility on doctors and the way in which they interpret the Act. The testing of that is also to be welcomed. Those aspects are absolutely at the core of the legislation. They are not to be taken lightly. I await developments before the court with considerable interest. As the noble Viscount, Lord Craigavon, mentioned, doctors in a particular case may think that a cleft palate is symptomatic of a more serious underlying condition. I simply do not know the facts. Until one does know the facts, it is very difficult to make a judgment. However, perhaps doctors will be influenced by the mental state of a prospective mother. Again, I do not know the facts.
Although one may regret the sheer numbers of abortions—more than 170,000 in 2002—as the noble Lord, Lord Alton, said, 1,800 of those were performed on grounds of serious disability. However, in terms of today's debate, after the 24-week period, only one of those was performed on the grounds of cleft lip or cleft palate. It is important that we put that in context.
However—and there is a however—I believe that we should seriously consider the court's conclusion, when it comes, and contemplate amendment of the Act if we need to. We should also ensure that when parents have antenatal screening, they receive information and counselling, as the noble Lord, Lord Chan, says, about the nature and consequences of handicaps or disability. I have seen enough parents of handicapped children and children with severe learning difficulties to know that those children are often cherished and joyful additions to families. As one wise journalist said in commenting on this area:
"We should be more accepting of imperfection".
"Serious handicap" is a blanket term, but the range of seriousness in each condition can be enormous, giving rise to very difficult value judgments in these circumstances. So I believe that the key is to ensure that parents take the right decisions, that we do not morally censure them, but that they do have the information and counselling which enable the right decisions to be made.
8.55 p.m.
Earl Howe: My Lords, as the noble Lord, Lord Alton, has indicated, the problem at the heart of his Question is not only the interpretation of the terms used in the
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Abortion Act 1967, it is also a medico-ethical one. It is one matter, and an important matter, to try to determine what Parliament meant when it framed the present law. It is another matter to decide whether, against the background of current medical knowledge and practice, we feel it right to endorse the view that Parliament took in 1990 or to back away from it.
Taking his cue from a current legal case which I do not wish to comment on directly, the noble Lord has questioned the legality of an abortion of a foetus of more than 24 weeks' gestation, diagnosed as having a cleft palate, presupposing that this condition on its own is regarded by the doctors involved as giving rise to a serious handicap in the child, were the child to be born.
The Cleft Lip and Palate Association, to whose work I pay tribute, is quite clear. It states that,
"if only a cleft palate/lip is diagnosed, with no other medical complications, then late termination is not something we would condone".
I associate myself personally with those words. But we should note the qualification, "with no other medical complications". Cleft lip and palate can often be a marker for other congenital anomalies such as serious heart defects or chromosomal disorders. Pre-natal diagnostic tests are usually possible to screen for other conditions once cleft lip and palate have been diagnosed.
The question posed by the noble Lord, Lord Alton, however, presupposes that in a given case no other congenital anomalies have been diagnosed. As to what Parliament believed in 1990 when it amended the 1967 Act, there can, I think, be little doubt. At that time there were those who suggested publicly that under the Act as amended, an otherwise healthy foetus of more than six months could be legally aborted for having a hare lip or a cleft palate. This suggestion was greeted with outrage by various Members of Parliament, among whom were Sir David Steel, now the noble Lord, Lord Steel of Aikwood, and the current Solicitor General, Harriet Harman. The 1990 amendments were based on a report two years earlier by the noble and learned Lord, Lord Brightman, which spoke of,
"an abnormality that would prevent sustained life after birth or that would result in a gross handicap".
When he spoke in the debate on the Bill in your Lordships' House, the noble and learned Lord made a point of excluding hare lip or cleft palate from the scope of this definition.
At the same time, the Act is framed in a way that leaves the decision to proceed with a termination dependent on two doctors, acting in good faith, being of a certain opinion. I do not know how the courts will look at the case that has been mentioned, but it seems to me that this aspect of the Abortion Act—that an abortion, if it is to be legal, must be based on honest medical opinion rather than strictly on the facts—should play an important part in the court's deliberations. There can be no doubt that Parliament took proper cognisance of this in 1990.
Aborting a foetus on the principal grounds of cleft lip and palate is rare. There has been only one instance since 1990 where the foetus has been of more than

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24 weeks' gestation and, I believe, 25 instances where the foetus has been of 24 weeks' gestation or under. Some of us would question whether cleft lip and palate on their own are ever sufficient grounds for a termination. However, any decision to proceed with a termination will be one taken jointly by the woman and her doctors on an informed basis. The doctrine of informed consent applies both ways. The mother must be informed about what cleft lip and palate actually are and what they are not, what treatments are available, the success rate of such treatments, and the quality of life likely to be enjoyed by the child. She should also be informed that any diagnosis of cleft palate is open to a high degree of error; that is, of false positives.
Clinicians, on the other hand, need to interpret the law correctly, and here the guidance issued by the Royal College of Obstetricians and Gynaecologists is crucial. I have read the key parts of that guidance as regards what should constitute "serious handicap" when interpreting the Act, and it seems to be a model of clarity and accuracy. It would, I think, be impossible for any doctor reading those guidelines to conclude it would be legal to abort a foetus of more than 24 weeks' gestation solely on the grounds of cleft lip and palate.
Separate from the state of the law, the wider socio-ethical issue remains. The question is whether, looking at the issues afresh, physical handicap should carry the weight that it does in the Abortion Act and in the scales of decision-making on abortion. Over time, society's attitudes to matters such as this undergo change, and the law needs to keep pace. With the speech of the right reverend Prelate the Bishop of Coventry ringing in my ears from last week, I believe it behoves us all to reflect on the ideas that he emphasised: namely, the notion of personhood and the value we place on individuals who are less than whole. If, in due course, Parliament is given an opportunity to revisit those issues, I look forward to that debate.
9.1 p.m.
The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, I am sure we all appreciate why the noble Lord, Lord Alton, has raised this important issue. I am grateful to all noble Lords who have provided their views in the debate.
As we all know, in 1967 and 1990, Parliament decided, on a free vote, that abortions may lawfully be carried out in the circumstances specified in the act. As such, the Government consider that facilities for abortion treatment should be available. The Government also have a responsibility to monitor the provisions of the act as they are, unless and until Parliament chooses to further amend that law.
As many noble Lords will be aware, last December permission was granted to an applicant for a judicial review of whether cleft lip and palate can ever be considered as a serious handicap under the Abortion Act. The case will now proceed to a substantive hearing, to be heard the week commencing 24 May.
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The following declarations are now being sought: first, that serious handicap in Section 1(1)(d) of the Abortion Act 1967 has to be understand by reference to the remediability of the condition; secondly, that cleft lip and palate does not constitute "serious handicap" within the meaning of Section 1(1)(d); thirdly, that the foetus at 24 weeks has a right to life pursuant to Article 2 of the European Convention on Human Rights, which is only subject to the mother's Article 2 rights; and, fourthly, that Section 1(1)(d) is incompatible with Articles 2,3,8 and 14 of the European Convention on Human Rights. A declaration is also being sought that the police must reconsider their decision not to prosecute the two doctors in the case which led to the hearing.
I should clarify that the Secretary of State for Health has joined these proceedings as an interested party because the Department of Health has responsibility for monitoring the operation of the Act. This is done in three main ways. First, all independent sector places wishing to perform abortions have to be approved by a health minister under the Act. These places are also registered with, and regularly inspected by, the National Care Standards Commission.
Secondly, details concerning every abortion performed are required to be submitted to the Chief Medical Officer on Form HSA4. This notification is used by the department as an aid to checking that terminations are carried out within the law. Form HSA4 contains many details, including: the names and addresses of the doctors who certified there were grounds under the Act; gestation; method used; place of termination. Every form is checked and monitored and forms are returned to practitioners if information is missing or clarification is needed. However, it is possible that published statistics do not fully capture all the detail on forms because a coding process takes place. That is the best answer I can give to the noble Lord, Lord Alton, who raised this particular issue.
Thirdly, the Department of Health investigates any specific complaints and allegations of abuse. Three other interested parties have also joined the proceedings—the Royal College of Obstetricians and Gynaecologists, Antenatal Results and Choices, and Disability Awareness in Action.
As we are awaiting the decision of the court on the judicial review, it would be inappropriate for the Government to review the provisions of the Act and its working as suggested by the noble Lord, Lord Alton. I must proceed with great caution and not in any way appear to anticipate the judicial review. I am sure that your Lordships will understand if I do not venture responses in the debate to all the questions raised.
Turning now to the provisions of the Act, Section 1(1) of the Abortion Act, as amended, provides the grounds under which abortions may be carried out. As noble Lords have said, one of these sections, Section 1(1)(d), states that an abortion may be performed when two medical practitioners are of the opinion, formed in good faith, that there is a substantial risk that if the child were born it would suffer from such physical or mental abnormalities as to be seriously handicapped.

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The noble Lord, Lord Alton, asked about the compatibility of Section 1(1)(d) with the Disability Discrimination Act. My understanding is that in August 2001 the Disability Rights Commission ventured the view that this section was not inconsistent with the Disability Discrimination Act as that Act is concerned with the rights of living persons.
Turning now to the remediability of treatment, the judicial review will consider whether "serious handicap" should be considered in the context of the ability to treat the condition which has been diagnosed or is suspected. The availability of remedial treatment which might alleviate suffering is clearly a factor which may be taken into account under Section 1(1)(d) of the Act in making that assessment. As the noble Earl, Lord Howe, said, the Royal College of Obstetricians and Gynaecologists has given guidance on the care of women seeking abortion. It states that an opinion that a particular foetal abnormality would be associated with a serious handicap should be based on a careful consideration of a list of factors, not all of which may be relevant in every case but one of which is the probability of effective treatment, either in the womb or after birth.
However, the fact that remedial treatment may be available does not automatically mean that it will be successful and that the child will not suffer from a serious handicap. Remedial treatment may be prolonged, painful, subject to delays and doubts as to success, as well as dependent upon the co-operation of the Parents involved and the nature of the condition in question. Hence all factors in any one case must be assessed before a decision can be reached, as stated in the Royal College of Obstetricians and Gynaecologists guidance. A declaration that serious handicap has to be understood by reference to remediability would fetter the discretion conferred by the Act on doctors to accord remediability appropriate weight depending on individual circumstances.
I know that some may question whether cleft lip and palate should fall within the definition of "serious handicap". However, Parliament did not define serious handicap in the Act. Indeed, it chose to leave this to the expert judgment of the two doctors involved, who are required to form their own opinion about the seriousness of the handicap the child would suffer if born, taking into account the facts and circumstances of each individual case. Although the mother will of course be the person who ultimately must agree that the termination should go ahead, and good practice would require consultation with the parents during the process of reaching a decision about the seriousness of the potential handicap, Parliament decided that the lawfulness of any termination must ultimately be determined by two medical practitioners acting in good faith, as required by Section 1 of the Act.
In conferring on doctors the duty to reach decisions about the risk of serious handicap under Section 1(1)(d) of the Act, Parliament decided that doctors are best placed to reach specialist expert medical judgments on what conditions constitute a "serious handicap". Doubtless in this context the guidance that the Royal College of Obstetricians and Gynaecologists
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provides on these matters to its fellows and members is extremely important in guiding doctors. So, too, is any advice from relevant specialist medical sources, including the Royal Colleges relevant to that specialism, that have specialist knowledge of the suspected handicap in question. Every case is potentially different with a series of interlocking factors to be considered; the background context is the often fast developing area of medical and technological advances which the doctors in question must take into account when reaching such judgments.
We have been advised by doctors specialising in the condition that there are further adverse complications that may be associated with cleft lip and palate. For these reasons, and for the reasons given earlier, the department considers it inappropriate to advance a position as to whether or not the diagnosis of cleft lip and palate would in general terms amount to a serious disability. This is precisely the question that the Act requires the two doctors to answer on the facts of an individual case (having considered the guidance of the Royal College of Obstetricians and Gynaecologists, and other guidance, which is regularly reviewed). It cannot be answered in general terms. I must decline to respond further in this area to the questions posed by the noble Lord, Lord Alton.
In conclusion, the current judicial review will examine many of the issues raised here today and we await the outcome of that review. Noble Lords can be assured that the department takes its role in monitoring the Act very seriously and any complaints or allegations of abuse are investigated and action taken, as appropriate.
Baroness Andrews: My Lords, I beg to move that the House to now adjourn during pleasure until 9.15.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 9.12 to 9.15 p.m.]

Planning and Compulsory Purchase Bill
Further consideration of amendments on Report resumed.
[Amendment No. 144 not moved.]
Baroness Maddock Baroness Maddock moved Amendment No. 144ZA:
After Clause 51, insert the following new clause—
"Meaning of development
In section 55 of the principal Act there is inserted the following paragraph at the end of subsection (2)—
"() the carrying out of the improvement or maintenance of any building of works which fall within regulations made by the Secretary of State and which do not materially increase the overall retail sales floor area of the building by such percentage as the Secretary of State prescribes"."
The noble Baroness said: My Lords, I shall try to be brief. We had a lengthy discussion on the matter in Committee. The noble Lord, Lord Rooker, was sympathetic to my intentions concerning mezzanine development in out-of-town stores. As he has not

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managed to table an amendment on Report, I suspect that he is still considering the issue. Therefore, I shall not repeat all my previous remarks; I shall just go through the purpose of the amendment.
The amendment is slightly different from the one that I tabled in Committee. It would not prohibit any further internal expansion of retail stores; it would simply bring it within the planning system. Any proposals could then be properly assessed at the local level and brought within the democratic process of the planning system. Local planning authorities would then be free to set their own policies in their local development frameworks to allow or restrict such developments. That is totally in line with a plan-led system.
We have seen in the cases that I discussed at an earlier stage of the Bill that local communities find it difficult to defend their policies and town centres. That is why we wish to include a provision in the Bill to improve the situation.
At an earlier stage of the Bill, the Minister thought that we could perhaps address the matter through secondary legislation. There is a problem there because the secondary legislation would contradict provisions enshrined in the Town and Country Planning Act 1990.
I know that the Government have been consulting on the new PPS 6, which concerns retail development. If we do not take the opportunity to include a relevant clause in the Bill, it will be a long time before we have another chance. We have pointed out at several stages of the Bill that planning law is not changed very often and that we shall not have an opportunity to deal with the issue at a future date. That would be a shame because we have realised in recent years that if we are serious about sustainable development and keeping our town centres, we need a robust planning system. More recent planning permissions have understood that. It would be a shame if all that disappeared because we cannot manage to consolidate it with the Bill.
The issue falls within the scope of PPS 6, on which the Government have consulted. I draw noble Lords' attention to two points. Following our interesting exchanges in Committee, I had tea with representatives of Asda, who felt rather hard done by for having been picked out. They thought themselves to be the small players in the supermarket game. I shall speak about that in a moment. I made the point to them that the issue relates not just to town centres or supermarkets, but to sustainability as whole.
Climate change is affected. It is a much wider issue. When it comes to food and supermarkets, the average person now travels 893 miles per year to shop for food, and 60 per cent of that travelling is by car. Food shopping now accounts for 5 per cent of all our mileage in Britain. That is why the issue is a broad one and why we need to deal with it. Various local authorities have explained how they have had difficulty. I gave examples last time, so I shall not go through them again. Even when these authorities have put
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restrictions on planning, they have not been able to carry this through, and developers and owners of out-of-town retail space have appealed and won.
Just so that Asda does not feel that it is the only company being got at, we are not only talking about Asda—which we have to remember is Walmart, the world's largest company—but also Tesco, as well as lots of do-it-yourself companies like B&Q and Homebase. They have a dominant position in the market, and they obviously have an agenda: they want to expand their business. They have found that, because of the way the planning system works, one can change things inside a building without getting permission.
As there are no amendments down, I am not sure the Minister is going to be able to say anything tonight. I hope that he will be able to come forward with something at Third Reading. Given the late hour, I am not going to say anything else on this, other than that I beg to move.
Lord Rooker: My Lords, I can be commendably brief. The amendment proposes, among other things, the application of planning control to mezzanine floors of a certain size. As I stated on 5 February, we are giving this issue serious consideration. That consideration is not yet concluded. I am therefore unable to support the amendment this evening, but I hope to come back to the House as soon as possible.
Baroness Maddock: My Lords, I am grateful to the Minister. I suspected that that was where we had got to. I know it is not easy, because the consultation on the planning policy dealing with out-of-town shopping and trying to preserve our town centres does not only concern the Office of the Deputy Prime Minister, but also, of course, crosses over in to the Department of Trade and Industry, where I suspect some of the problems lie. I hope the Minister will be able to resolve this issue, and I look forward to seeing what he comes forward with. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 52 [Fees and charges]:
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 144A:
Page 40, leave out line 17 and insert—
"() provision as to the calculation of the charge or fee (including the person by whom it is to be calculated);
() circumstances in which no charge or fee is to be paid,"
The noble Lord said: My Lords, in Committee, in response to an amendment tabled by the noble Lord, Lord Lucas, we undertook to explore further the concept of a performance relationship for fees, and consider whether this is allowed for by the current wording of this clause. I can tell the House that, on examination, we have found that the wording of the clause does not cover such a relationship. However, we do think the concept is an interesting one, and we would like the Bill to allow for it. Therefore, we are tabling amendments 144A and 144B.
These amendments seek to allow the provision of a performance relationship, subject of course to the provision that, where authorities set their own fees, they must ensure, taking one year with another, that the income from the fees and charges does not exceed the cost of performing the function, something that was described very aptly in the local government and financial matters Bill that my noble friend Lord Rooker piloted through your Lordships' House last year. This is in line with our longstanding policy, and actually in line with that of the previous administration, which, I think, bears to be slightly congratulated on this one. Planning fees can be set to recover the full aggregate cost, but no more, of the services to which the fees are related.
I have a longer speaking note, but I think I have probably said enough on this matter. I hope that the amendments we are moving this evening find favour in your Lordships' House. I beg to move.
Lord Lucas: My Lords, I am very grateful that the Government have chosen to pursue this course, although I could never have drafted anything as skilfully as the government draftsmen have.
I would have tabled Amendment No. 144B a little differently; I would have allowed local authorities to make some surplus, perhaps within a prescribed limit. It is quite hard to be told that one must never make money; there is always a processing of the loss that means that, to some extent, there is always a burden on ratepayers. To chastise my noble friend again, I do not think that Kensington and Chelsea sets its parking fees so that it never makes a profit. Whereas one wants to keep such matters within bounds, to say that there should never be a surplus is to say that there always has to be a loss, which is not how I would like to see it. None the less, one should not quibble, and I am delighted that we have made some move in the right direction.
Baroness Hamwee: My Lords, the drafting is so skilful that I was grateful for the explanation; I have to say that I wondered what the amendment was about. We have probably had a helpful letter, too.
On the previous occasion, the Minister said that the Government's long-standing policy, and that of the previous administration, was to set planning fees to recover the full aggregate costs. I thought then that the chance would be a fine thing. It is entirely right that the costs should be covered with perhaps even a surplus to allow a bit of scope. However, I want to put on record that I have very considerable reservations indeed about performance-related fees.
I have reservations about the Government's approach to assessing performance generally, and I can see a lot of problems and elephant traps in somehow relating what can be charged to the performance. It could be the start of a rather difficult slope into thinking such as, "Well, we'd better say yes because of the financial implications". There is enough of that in the exercise of planning functions now, with development control committees being told, "Think of the costs it' you appeal".
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I would also like to voice a note of concern about what I understand as allowing local planning authorities to set individual rates. That could affect where developers choose to develop. The whole point of having spatial strategies, development plans and so on is to both control such matters and encourage development where it is wanted. Fees are in a separate compartment from that, and it will be difficult if there is any mixing up of the two.
Lord Bassam of Brighton: My Lords, I am grateful for the welcome from the noble Lord, Lord Lucas. I take it that he is in spirit with me and is one of those who wants to see a bit of municipal entrepreneurialism. Actually, I would rather like to see a good deal more of it than we have been allowed to achieve in the local government sector in the past. That was why I was rather pleased with the most recent piece of local government legislation, which we put through this House in the previous Session.
I am sorry that we had a less than enthusiastic response from the Liberal Democrats. As leader of a local authority, I struggled to get the planning function to perform at any great speed or to the satisfaction of clients at all during my tenure and watch in that office. It was one of my continuing and enduring frustrations. The provision may well operate as an incentive to some local authorities that do not get a move on, basically, in considering planning applications and do not commit sufficient resource or enthusiasm to the planning process. That is what we need to do. If we were to adopt the concern enunciated by the noble Baroness, I rather think that local authorities would be stuck in the past for ever and would not respond to any sort of incentive or encouragement at all.
With those comments, I hope that noble Lords will generally welcome what we have done.
On Question, amendment agreed to.
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 144B:
Page 40. line 25, at end insert—
"() After subsection (5) there are inserted the following subsections—

"(5A) If the local planning authority calculate the amount of fees or charges in pursuance of provision made by regulations under subsection (1) the authority must secure that, taking one financial year with another, the income from the fees or charges does not exceed the cost of the performance of the function or doing of the thing (as the case may be).

(5B) A financial year is the period of 12 months beginning with 1 April.""

9.30 p.m.
Lord Rooker Lord Rooker moved Amendment No. 144C:
Page 40, line 40, leave out subsection (4) and insert—
"() The consultee must give a substantive response to any consultation mentioned in subsection (2) or by virtue of subsection (3) before the end of—

(a) the period prescribed for the purposes of this subsection, or

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(b) such other period as is agreed in writing between the consultee and the appropriate authority or the local planning authority (as the case may be)."

The noble Lord said: My Lords, this amendment ensures that the duty to respond within a prescribed period includes a degree of flexibility to allow for situations where a statutory consultee might not be able to respond within a fixed period, for example when an environmental statement is required. We decided that the Bill as drafted did not enable us to provide this flexibility. This amendment will put that right. I beg to move.
Baroness Hanham: My Lords, I am slightly sorry about that explanation. We were looking not so much for flexibility from consultees within these clauses, but an indication that the consultee was going to have to reply within a reasonable space of time, so as not to hold everything up. The Minister may be correct that the flexibility is useful here, but equally useful would have been that the consultee—it could be anyone who needs to reply, English Heritage, the fire brigade—does not hold the proceedings up by not replying within due course. I think that the Minister's amendment does that. There was a slight overemphasis on flexibility, but the prescribed period will presumably be laid down in regulations, because it is certainly not here, or the period will be agreed presumably each time that there is a requirement for a consultee to make a response. Might the Minister be able to give us a bit more indication of what the prescribed period will be, and prescribed by whom?
Lord Rooker: My Lords, I took those out in the interests of making progress. We have already consulted on draft amendments to the Town and Country Planning (General Development Procedure) Order 1995, and its associated guidance, which explains how we want the duty to respond to work. The draft order specifies that the duty to respond will be 21 days or such period as may be agreed in writing by the local planning authority.
On Question, amendment agreed to.
Lord Bridges Lord Bridges moved Amendment No. 144CZA:
After Clause 54, insert the following new clause—
"ENFORCEMENT OF PLANNING CONTROLS

(1) A local planning authority must exercise its powers so as to ensure compliance with planning controls in its area.

(2) A local planning authority may decline to take enforcement action in a case where planning permission would have been granted without conditions."

The noble Lord said: My Lords, I rise to speak to my amendment about enforcement. I had not anticipated the Government's decision in their Amendment No. 143A, which has effectively side-tracked my amendment. I would like to suggest a somewhat different line of approach.
I welcome the Government's decision to take action on the long review of enforcement which ended in December 2002. The procedure envisaged of issuing stop notices is worthy of serious consideration. There
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is one aspect that still concerns me. Hitherto, a planning authority has had some discretion of action in enforcement matters. These authorities were often reluctant to move decisively, because they were under no statutory duty to take such action if the conditions of the planning decisions were not being fulfilled. Understandably, the local authorities preferred to spend more resources on those areas where they did have statutory obligations. Curiously, although the authorities are given extensive new powers in the government amendment, enforcement is still apparently a discretionary activity, permissible but not obligatory.
My reaction to the government amendment is that, while the extensive new powers are welcome, they should be made even better by being linked to the obligation to enforce the terms of the original planning consent as a specific statutory duty. Unless this is included, I fear that the Government's bold initiative will not produce the required results in improving our planning procedures, whatever it does to the Gypsies. I beg to move.
Lord Rooker: My Lords, notwithstanding what the noble Lord just said, the intention behind the amendment is unclear. It seems to be designed to ensure that the local planning authority exercises its powers in such a way as to ensure that breaches of planning control do not occur. The amendment appears to place a duty on local planning authorities to take enforcement action in every case where there is a breach of planning control, except where planning permission would have been granted without conditions. Currently, local planning authorities' enforcement powers are discretionary, as the noble Lord said. That issue has been considered as part of our review of the current planning enforcement arrangements on which we intend to announce the outcome of a public consultation later this year.
Local authorities have the primary responsibility for taking whatever action may be necessary in the public interest. This provides flexibility to tailor their approach to each case to fit the nature and circumstances of the alleged breach of planning control. Minor breaches can often be remedied without the need for a form of enforcement action. Indeed, often such breaches arise out of a genuine misunderstanding of the planning position or a mistaken belief that planning permission was not required.
It is important that a balance is able to be struck between situations where development, though unauthorised, is not causing particular harm and those where enforcement action is essential in order to remedy a more serious breach of control. If unauthorised development is not causing particular harm and where, had an application for planning permission been made it would have been granted unconditionally, the better approach is to invite submission for a retrospective application. The response should be proportionate to the breach alleged to have occurred.
A duty to enforce in all cases, irrespective of the nature and circumstances of the breach, would place an additional and, we think, unwarranted burden on local

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authorities, even in cases where planning permission would have been granted without conditions. It is important that they can target their resources on the most important cases.
Local planning authorities need to consider taking enforcement action in order to ensure compliance with planning controls in their area where a breach is brought to their attention. Obviously, complaints about alleged breaches of control should be recorded and investigated. If a local authority, having considered the circumstances of the alleged breach, has decided that enforcement is unnecessary, it should be prepared to explain and justify that decision. Failure to take enforcement action which was plainly necessary can result in a finding of maladministration by the local government ombudsman. Alternatively, it might be the subject of judicial review by the court.
A duty to take action in all cases, as this amendment seems to imply, would remove the freedom for local authorities to exercise judgment. The responsibility is on local authorities. They should be able to exercise judgment in a responsible, reasonable and, as I said, proportionate way. Therefore, I hope that the noble Lord will be satisfied that the amendment is not justified.
Lord Bridges: My Lords, I am grateful to the noble Lord, Lord Rooker, for replying so fully. I do not read the new clause that he has tabled in quite the same way that he does. I would not say that the local authority would have to take action in every case. But their tendency is not to take action even when pressed to do so. I have prepared a dossier of cases which, if we were speaking at a somewhat different hour, I might have read out one or two examples for the noble Lord. But I am fairly confident in feeling that the degree of voluntary activity left to the local authority will not produce the required results. Having said that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hanham Baroness Hanham moved Amendment No. 144CA:
Page 114, line 19, at beginning insert "For"
The noble Baroness said: My Lords, at the outset I should like to say that if the Minister was to view this amendment sympathetically and if it were to be included in the Bill at a later stage, it would affect my own borough, the Royal Borough of Kensington and Chelsea. I need to put on record that an amendment I am moving would be of interest to the borough.
The Planning and Compulsory Purchase Bill 2004 seeks to extend planning control to Crown land. However, in respect of the continuation of uses on the transfer of Crown land, the Bill reduces planning control. Amendment No. 144CA seeks to reverse that change and to provide that the continuation of a use by private interests following the disposal of Crown land requires planning permission.
In principle, if land is disposed of by the Crown a private purchaser can continue the use without requiring planning permission. That was decided in a case involving Newbury District Council; namely,
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Newbury District Council v Secretary of. State for the Environment [1977] J.P.L. 373. For instance, if the Crown is allowing its playing fields to be used for commercial events or other events that cause a great deal of disturbance to local residents in terms of, for example, amenity and traffic congestion, the new owner would be able to continue that use.
That problem was recognised when limited planning control over Crown land was introduced by the Town and Country Planning Act 1984. That Act provided for agreements to discontinue uses when land was disposed of by the Crown.
The 1984 Act provisions are now contained in Section 301 of the Town and Country Planning Act 1990. Section 301 provides that a local planning authority and the Crown may make an agreement with respect to a material change of use which has been made or is proposed to be made by the Crown on Crown land. The effect of an agreement is that the particular use will have to be discontinued if the land is disposed of. This is achieved by treating the particular use as having planning permission subject to a condition that the use be discontinued if the Crown cease to use the land. Planning permission will have to be sought if the use is to be carried on by private hands. The local planning authority will be able to consider whether it should continue and, if so, whether conditions should be imposed.
The Bill requires the Crown to seek planning permission for changes of use which take place after the commencement of the new Crown land provisions. It repeals Section 301 agreements, except that those agreements already made shall continue in force (page 114, Schedule 3).
The Bill, therefore, has the following effects. First, if the Crown makes a material change of use after the new provisions are in force, planning permission will be required. The planning permission may provide that the use is discontinued if the Crown ceases to use the land. Alternatively the local planning authority may be content that a private purchaser can continue the use.
Secondly, if the Crown agrees before the Crown land reforms take effect that a use shall be discontinued if it disposes of the land, the agreement continues to bite against a subsequent purchaser. Thirdly, if the material change of use occurs before the new Bill comes into force, but no agreement is in place at that time, the use can be continued by a purchaser. It will not be possible to enter into a Section 301 agreement. Consequently, the ability to control Crown land on disposal is, in an important respect, reduced because of the reforms.
Briefly, therefore, the proposed amendment provides for the discontinuance of uses of land which have not received planning permission, on their disposal by the Crown. It substitutes new text for Section 301.
Where a material change of use has taken place before the new Crown land provisions, the amendment treats the land as having had planning permission subject to a condition requiring the discontinuance of

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the use when it ceases to be used by the Crown. This is the same legal mechanism that is used in the present Section 301 agreements, except that the requirement will now apply automatically. Planning permission will need to be secured either by the Crown or by a private purchaser to enable the use to continue.
The amendment does not apply to post-relevant date changes of use by the Crown as planning permission will be needed for those areas and those uses. It does not affect the use of land which is disposed of by the Crown before the Crown land reforms take effect.
The final amendment in this set removes the carry over provisions for existing Section 301 agreements. These are no longer required as the amended Section 301 has the same effect. I beg to move.
Lord Rooker: My Lords, our policy is that Crown development which has been agreed under the current arrangements, as set out in Circular 1884, shall be treated as if it had planning permission granted under Part 3 of the principle Act. That is set out in paragraph 3 of Schedule 4 to the Bill. That means that authorised uses will run with the land as for any other land with planning permission. That renders Section 301 redundant, which is why we intend to repeal it.
Amendment No. 144CB in effect makes all Crown land subject to Section 301 agreements. That will mean that planning permission will have to be obtained for all disposals of developed Crown land if that use is to continue, even in the most trivial of cases. This amendment would place an unnecessary and disproportionate burden on both the Crown and the local planning authorities, and I hope that the noble Baroness's local planning authority will thank me for making sure that it does not suffer this unnecessary burden.
9.45 p.m.
Baroness Hanham: My Lords, I can assure the House categorically that my local planning authority will not be happy with that response. It is a major concern not only for my authority but for others that the use of land that has been carried out by the Crown passes automatically to a private landowner without any further permission. I think that I am right in saying that it would not have required permission in the first place, as it was Crown land.
I am disappointed with the Minister's reply. It does not get to the heart of the problem. Most planning authorities would not be upset at being required to consider again the use of land that was in Crown hands. That is what the amendment was looking for. The onus on planning authorities would not be great, because it probably would not arise that often. It is a particular problem for my authority, and it will be for others. I am disappointed that the Minister's reply was so negative on the matter. It will cause considerable problems.
I thank the Minister for his reply, and I will consider whether to return to the matter at the next stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 144CB and 144CC not moved.]
Clause 79 [Special provision relating to national security]:
Lord Rooker Lord Rooker moved Amendment No. 144CCA:
Page 54, line 35, leave out "such a person" and insert "a person appointed under subsection (5) or (6)"
The noble Lord said: My Lords, in moving Amendment No. 144CCA, I shall speak also to Amendments Nos. 144CCB to 144CCF and to the related amendments, Amendments Nos. 144CCK to 144CCM, which deal with special advocates under the national security provisions.
I shall speak mainly to Amendments Nos. 144CCA and 144CCB, which amend the principal Act. The amendments make changes and additions to amendments already made in Section 321 of the Town and Country Planning Act 1990. That section enables the Secretary of State to direct that evidence must be withheld from a planning inquiry on the grounds of security and national interest. Where such a direction is sought, the amendments already made provide for the appointment of a special advocate to represent the interests of any parties that would otherwise be prejudiced by their inability to hear or inspect all the evidence. If a direction is made, the special advocate will represent the interests of those parties to the inquiry.
Amendment No. 144CCA is consequential on new subsection (6) of Section 321, which was substituted on Report in another place. As currently drafted in subsection (7), the Lord Chancellor's rules, which set out the special advocate's functions, would apply only when the special advocate had been appointed under the new subsection (5), which relates to occasions on which the Secretary of State is considering whether a direction should be made. The amendment makes it clear that the rules will also apply when the special advocate has been appointed for the purpose of a planning inquiry, after direction has been given, as under the new subsection (6).
With regard to Amendment No. 144CCB, noble Lords will recall that my noble friend Lord Bassam of Brighton agreed to look into specifying who should pay the special advocate, when we discussed the amendment in Committee on 5 February, as reported at cols. 896 of Hansard. Noble Lords will also recall that my noble friend said that the policy was that the Crown body that triggered the need for a Section 321 direction would pay the special advocate, who is called the "appointed person". However, we must allow for the possibility that a private person might also ask for a direction to withhold information, hence the formulation of the first subsection in Amendment No. 144CCB. The second subsection provides for the Secretary of State to determine any dispute about the fees and expenses payable to the special advocate. The third subsection provides for the amount claimed by the special advocate to be certified, whether it was agreed or determined by the Secretary of State. The fourth subsection provides that the certified amount is recoverable as a civil debt.
The provisions have been derived in part from Section 250(4) of the Local Government Act 1972, which is a general provision dealing with the Secretary of State's costs at public inquiries. The concepts in this Bill are not novel.
I turn briefly to the Scottish amendments, which are Amendment No. 114CCK to Amendment No. 144CCM in Clause 90. These make similar provisions for the Scottish principal Act. There is a variation in that both the Secretary of State and the Scottish Ministers have the power to give a direction under the new Section 265A depending on the circumstances. We therefore have provision for whoever is considering giving or has given a direction to specify who should pay the special advocate fee and settle any such disputes.
The Scottish provisions do not have to be repeated because the new Section 265A is carried through in the Scottish Listed Building and Hazardous Substance Acts by means of subsections (2) and (3) of Clause 90. I beg to move.
Baroness Hamwee: My Lords, can the Minister be any more detailed about the first paragraph in Amendment No. 144CCB? He has explained that it would allow the Secretary of State to direct that the developing department, which was the term used at the last stage, or an individual who has brought about the situation, should pay the fees. But the stipulation that any person he thinks is interested in the inquiry is wide. What, for instance, if the Secretary of State were to say, "Mr So-and-So has taken up three weeks of this inquiry with ridiculous questions and should be paying".
The term "interested in the inquiry" does not immediately suggest to me that those who may find themselves the target of the Secretary of State's direction would necessarily fall within those referred to by the Minister in his explanation. I do not know whether the Minister will be able to help tonight.
Lord Rooker: My Lords, most certainly not. I believe that the noble Baroness has put an interpretation on the subsection which is wholly unjustified. The noble Baroness does not trust my right honourable friend the Secretary of State and that has been apparent throughout the passage of the Bill. She believes that he will always behave unreasonably. I have not got a chapter and verse explanation as to whether he would direct any person whom he thinks is interested in the inquiry. That would be legally binding. There will be chapter and verse in making sure that he gets the correct person and not the incorrect one, to pay the fees and expenses of the appointed person. If there is anything else I need to say, or if it is necessary for me to write to the noble Baroness, I shall do so.
Baroness Hamwee: My Lords, with the leave of the House, and as I have said before, it is not the Minister's right honourable friend whom I distrust necessarily. It may be somebody else's right honourable friend when it has to be applied. It is not a question of trusting; it is a question of what the legislation actually provides.
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If Parliament says that this is what the legislation should say, it would be perfectly reasonable for a future Secretary of State to use it in any way which falls within what we appear to be about to agree.
On Question, amendment agreed to.
Lord Rooker Lord Rooker moved Amendments Nos. I44CCB to 144CCF:
Page 54, line 38, at end insert—
"() If a person is appointed under subsection (5) or (6) (the appointed person) the Secretary of State may direct any person who he thinks is interested in the inquiry in relation to a matter mentioned in subsection (4) (the responsible person) to pay the fees and expenses of the appointed person.
() If the appointed person and the responsible person are unable to agree the amount of the fees and expenses, the amount must be determined by the Secretary of State.
() The Secretary of State must cause the amount agreed between the appointed person and the responsible person or determined by him to be certified.
() An amount so certified is recoverable from the responsible person as a civil debt."
Page 55, line 12, leave out "such a person" and insert "a person appointed under sub-paragraph (7A) or (7B)"
Page 55, line 15, at end insert—
"() If a person is appointed under sub-paragraph (7A) or (7B) (the appointed person) the Secretary of State may direct any person who he thinks is interested in the inquiry in relation to a matter mentioned in sub-paragraph (7) (the responsible person) to pay the fees and expenses of the appointed person.
() If the appointed person and the responsible person arc unable to agree the amount of the fees and expenses, the amount must be determined by the Secretary of State.
() The Secretary of State must cause the amount agreed between the appointed person and the responsible person or determined by him to be certified.
() An amount so certified is recoverable from the responsible person as a civil debt."
Page 55, line 32, leave out "such a person" and insert "a person appointed under sub-paragraph (7A) or (7B)"
Page 55, line 35, at end insert—
"() If a person is appointed under sub-paragraph (7A) or (7B) (the appointed person) the Secretary of State may direct any person who he thinks is interested in the inquiry in relation to a matter mentioned in sub-paragraph (7) (the responsible person) to pay the fees and expenses of the appointed person.
() If the appointed person and the responsible person are unable to agree the amount of the fees and expenses, the amount must be determined by the Secretary of State.
() The Secretary of State must cause the amount agreed between the appointed person and the responsible person or determined by him to be certified.
() An amount so certified is recoverable from the responsible person as a civil debt."
Schedule 5 [Crown application: Scotland]:
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendments Nos. 144CCG. 144CCH and 144CCJ:
Page 121, line 42, at end insert "(including any enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament)"
Page 122, line 17, at end insert "(including any enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament)"

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Page 122, line 29, at end insert "(including any enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament)"
The noble Lord said: My Lords, I shall attempt to be brief. I shall move these three amendments and speak also to Amendment No. 144CCN and Amendments Nos. 154 to 160. These relate to the Scottish provisions of the Bill on the removal of Crown immunity and in particular to the commencement of these provisions.
Amendments Nos. 144CCG to 144CCJ relate to Schedule 5 of the Bill on Crown Application: Scotland. Paragraphs 10, 11 and 13 of the schedule contain powers to amend statutory provisions relating to applications for planning permission, conservation areas, listed building consents and hazardous substances consents made by or on behalf of the Crown. These powers allow us to amend the statutory provisions where they might be inappropriate when applied to applications by the Crown. There are equivalent powers in Schedule 3 relating to England and Wales.
Given the lateness of the hour, I propose to say no more on the matter. The amendments are quite straightforward. I will be happy to take questions on particular amendments, if that would be convenient to noble Lords. I beg to move.
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment Nos. 144CCH and 144CCJ:
Page 122, line 17, at end insert "(including any enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament)"
Page 122, line 29, at end insert "(including any enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament)"
Clause 90 [Special provision for certain circumstances where disclosure of information as to national security may occur: Scotland]:
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendments Nos. 144CCK to 144CCM:
Page 65, line 17, at end insert "and as to the functions of a person appointed under subsection (5)"
Page 65, line 20, at end insert "and as to such functions"
Page 65, leave out line 21 and insert—

"(6A) If a person (the appointed person) is appointed—

(a) under paragraph (a) of subsection (5) and either no direction in relation to the evidence in question has been given under subsection (3) or any such direction so given has been given by the Secretary of State, the Secretary of State may direct any person who he thinks,

(b) under paragraph (a) of subsection (5) and such a direction has been given under subsection (3) by the Scottish Ministers, the Scottish Ministers may direct any person who they think,

(c) under paragraph (b) of subsection (5) and the direction referred to in that paragraph was given by the Secretary of State, the Secretary of State may direct any person who he thinks,

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(d) under paragraph (b) of that subsection and the direction so referred to was given by the Scottish Ministers, the Scottish Ministers may direct any person who they think,

is interested in the inquiry in relation to a matter mentioned in subsection (4) (the responsible person) to pay remuneration or allowances to, and to reimburse any expenses incurred by, the appointed person.

(6B) If the appointed person and the responsible person are unable to agree an amount payable by virtue of—

(a) paragraph (a) or (c) of subsection (6A). the amount must be determined by the Secretary of State,

(b) paragraph (b) or (d) of that subsection, the amount must be determined by the Scottish Ministers.

(6C) The Secretary of State must cause an amount payable by virtue of paragraph (a) or (c) of subsection (6A) (whether determined under subsection (6B) or agreed between the appointed person and the responsible person) to be certified.

(6D) The Scottish Ministers must cause an amount payable by virtue of paragraph (b) or (d) of subsection (6A) (whether so determined or so agreed) to be certified.

(6E) An amount certified under subsection (6C) or (6D) is recoverable from the responsible person as a debt."

Clause 97 [Subordinate legislation: Scotland]:
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 144CCN:
Page 72, line II, at end insert—
"()In subsection (3), "instrument" includes an instrument made under an Act of the Scottish Parliament."
Clause 98 [Compulsory acquisition of land for development etc]:
Lord Hanningfield Lord Hanningfield moved Amendment No. I 44CD:
Page 72, line 21, leave out "think" and insert "have reasonable grounds to believe"
The noble Lord said: My Lords, these amendments concern local authorities' powers to acquire land compulsorily. In principle, as the Minister knows, I am in favour of anything that widens the powers of local authorities. There is no doubt that the current provisions in the Bill do that. However. I also recognise that powers such as compulsory purchase must strike a delicate balance between the needs of local authorities and the rights of private individuals.
Local authorities already enjoy significant powers to enable them to purchase land compulsorily for the purpose of development, redevelopment or improvement. On this occasion we must pay heed to the significant unease regarding the new provisions, expressed by those sectors of the community most likely to be affected.
Both the National Farmers Union and the Country Landowners' Association have publicly opposed the provisions in the Bill. I am keen to avoid making the lives of local authorities more difficult because the new provisions are widely opposed and discredited. There is clearly a danger of that happening, and such an outcome would be very unfortunate in an area that is obviously sensitive and requires delicate handling.
The amendments that I have tabled are supported by both the NFU and the CLA. They expand on the current provisions for local authorities regarding

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compulsory purchase but also offer the safeguards that the NFU and CLA are keen to see maintained in the system. In the long run it would be in the interests of local authorities to work within a framework of powers that are broadly supported by the communities affected. These amendments will achieve that balance. I beg to move.
Baroness Hamwee: My Lords, I support the amendments. The Minister may say that the purpose of the first and third amendments, which would delete the term "think", will be met by the requirement that a local authority's decision is reasonably based on Wednesbury principles. In the House of Commons, the Minister simply said that that was implicit; perhaps the Minister in this House can be clearer.
On Amendment No. 144CE, it was said that there were adequate safeguards against the wide provision for facilitating in the Acquisition of Land Act 1981. But that does not seem to explain why it is necessary to use the term "facilitate" rather than have the test of necessity; nor does it say why it is no longer necessary for there to be any obligation to have regard to any plan.
When the Country Land and Business Association contacted me, I asked what was its understanding of this change in the legislation. I hope that I am not putting too many words into its mouth, but, as an active member of the Government's own consultative group, it was still unclear and unconvinced. In response to my question whether the association had had any correspondence with the Office of the Deputy Prime Minister, it sent me a letter in which the ODPM expresses its concern that to replace "will facilitate" by "is necessary for" would impose a more onerous requirement on the local authority; that a requirement to determine what is necessary would introduce less certainty; and that there would be difficulties in determining what is necessary. Are those terms any less clear than what is in the current Section 2261A of the 1990 Act, which uses the term "required":
"required in order to secure the carrying out of development, redevelopment, or improvement'"?
Or:
"required for the purpose for which it is necessary to achieve in the interests of proper planning of an area".
I do not immediately see—nor, indeed, have I thought about it for a bit—that there is a difference between the two terms "necessary" and "required", and why one is less certain than the other.
I asked the Country Landowners' Association why it thought the clause was in the Bill. I expected to hear that there would be problems about ransom strips and so on. They were not able to help me on this. I hope that the Minister can.
10 p.m.
Lord Rooker: My Lords, I will, but it will take some time as I insist on having a proper reply to the lengthy submission of the CLA and the NFU. Having read it myself, and asked for extra notes to be prepared, I am damned it' I am not going to use them.
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I am certain that there is a satisfactory answer. The whole point of Clause 98 is that it clarifies, in simpler terms, the existing planning compulsory purchase powers. By referring to the acquiring authority "thinking" that the necessary circumstances apply, the authority is required to have a belief in what it is doing. We think that this is right and the word "think" should remain. I cannot see what distinction colleagues would seek to make by amending "think" to "have reasonable grounds to believe" except that it does not express what is required so simply.
Local authorities are subject to the overriding requirement that their decisions are justifiable as reasonable in all circumstances. It is therefore superfluous, unnecessary and complicated to add this. The reference to "think" has been used extensively in other parts of the Bill. I am not going to refer to them all. In my letter of 18 February which was sent to noble Lords and noble Baronesses, I also referred to the use of the word "think" elsewhere in the Bill, in the light of questions about whether this was a suitable term for legislation. As that letter explained, an electronic search of the UK statutes database revealed 7,897 uses of the word "thinks", and gave examples.
Amendment No. 144CE seeks to replace "will facilitate" by "is necessary for". While seeking to impose a more onerous requirement on the local authority, the amendment in fact introduces less certainty by imposing a requirement to determine what is meant by "necessary". It may be trying to suggest that there has to be an absolute necessity, but having regard to what, and how would that be assessed?
It may be that the noble Baroness is concerned that acquiring authorities will exercise their compulsory purchase powers in an unreasonable manner. There are, however, already perfectly adequate safeguards—by way of judicial review and challenge—to ensure that authorities act reasonably and cannot acquire land compulsorily unless it is in the public interest to do so. There is also the safeguard that any compulsory purchase order has to be confirmed by the relevant Secretary of State, which I will return to in a moment.
Clause 98 will require a local authority to show why it thinks that the development, redevelopment or improvement for which the land is to be acquired would be likely to contribute to the achievement of the promotion or improvement of the economic, social and/or the environmental well-being of its area.
"Development" is the usual definition contained in the planning legislation. In seeking to use its compulsory purchase powers as a mechanism for implementing its duty of well-being through that means, a local authority will need to be able to establish why it thinks that the compulsory acquisition of the land concerned will contribute to a achieving that objective.
For an authority to be able to demonstrate conclusively that the acquisition is justified to secure the well-being of their area, they will need to be able to show that it is in accordance with their up-to-date planning proposals prepared in full consultation with

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those living and working in the area. These may, for example, be in the community strategy or the pathfinder area prospectus. Ideally, these policies will already have been given a spatial dimension in the authority's development plan. But where there has not yet been time to update that to reflect the current proposals for which the land is required, it does not make sense to delay the acquisition of the land until such time as it is.
Secondly, as I mentioned, in order to be implemented, a compulsory purchase order has to be confirmed by the Secretary of State. He has not only to be satisfied as to the statutory grounds for making the order, but he also has a discretion as to whether to confirm. This is an important safeguard because the Secretary of State acts as an impartial adjudicator of whether the compulsory acquisition of an owner's land is truly justified in the public interest. In exercising his discretion, the Secretary of State must have regard in particular to whether the public interests in compulsorily acquiring the land outweigh the interests of the owners and occupiers in retaining their land. Such owners and occupiers who object will have had an opportunity to make representations at a public inquiry.
Thirdly, if the Secretary of State does not have proper grounds for confirming a compulsory purchase order, an aggrieved party may challenge its validity in the High Court, which has the power to quash it. I realise that that is a daunting and potentially expensive prospect for any potential litigant, but its value is as a safeguard to ensure that decisions are not taken frivolously.
Clause 98 enables a local authority to acquire compulsorily land which it thinks will facilitate the carrying out of development, redevelopment or improvement as a means of bringing economic, social or environmental benefit to its area. It will assist authorities to fulfil their duties under Section 2 of the Local Government Act 2000 to promote the economic, social and environmental well-being of its area. Local authorities have welcomed that.
I hope that the noble Baronesses are now reassured that while Clause 98 will make compulsory purchase an effective tool to help authorities to fulfil their duty of well-being, there are more than adequate safeguards in the compulsory purchase process to ensure that acquiring authorities act at all times reasonably, having regard to the balance which needs to be struck between public and private interests.
I apologise for the length of my reply, but I think it was worth making in view of the quite substantial and detailed note from the CLA and NFU which I read yesterday. I asked for my notes to be extended to take account of it.
Lord Hanningfield: My Lords, I thank the Minister for that very detailed reply. We have previously pointed out the problem of using the word "think" in this legislation and other legislation, as the Minister said. Such usage is unsettling to outside organisations
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as they do not always understand what the Government and the legislation mean by the word "think". The Minister has given a detailed reply which we, the CLA and the NFU will read. We will see if those organisations are sufficiently reassured by the reply. I thank the Minister and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 144CE and 144CF not moved.]
Clause 100 [Procedure for authorisation by a Minister]:
Lord Rooker Lord Rooker moved Amendment No. 144D:
Page 78, line 7, leave out "appropriate authority" and insert "Minister"
Lord Rooker Lord Rooker moved Amendments Nos. 144E to 144W:
Page 78, line 8, leave out "it" and insert "he"
Page 78, line 26, leave out "appropriate authority" and insert "Minister"
Page 79, line 18, leave out "appropriate authority" and insert "Minister"
Page 79, line 19, leave out "it has considered the objection and either" and insert—

"(a) the appropriate authority has considered the objection, and

(b) one of the conditions in sub-paragraph (5A) is satisfied.

(5A) The conditions are"
Page 79, line 20, leave out "it" and insert "the appropriate authority"
Page 79, line 20, leave out ", or"
Page 79, line 23, leave out "it" and insert "the appropriate authority"
Page 79, line 38, leave out "appropriate authority" and insert "Minister"
Page 79, line 43, after first "the" insert "Minister or. if there is a remaining objection in respect of the order, the"
Page 79, line 47, leave out "appropriate authority" and insert "Minister"
Page 80, line 2, leave out "appropriate authority" and insert "Minister"
Page 80, line 3. leave out "complying" and insert "the appropriate authority has complied"
Page 80, line 4, leave out "it" and insert "he"
Page 80, line 4, leave out "complying" and insert "the appropriate authority having complied"
Page 80, line 5, leave out "it" and insert "he"
Page 80, line 7, leave out "appropriate authority" and insert "Minister"
Page 80, line 8, leave out "it" and insert "he"
Lord Hanningfield Lord Hanningfield moved Amendment No. 145:
After Clause 108, insert the following new clause—
"RETURN OF LAND TO FORMER OWNER
The Secretary of State may by regulation make provision regarding the return of land to its former owner by way of sale if—

(a) acquired by or under the threat of compulsory purchase; and

(b) which was no longer required for the purpose for which it was acquired."

The noble Lord said: My Lords, with this amendment we return again to the issue of the Crichel Down rules. I am grateful to the noble Lord, Lord Rooker, for the letter in which he set out the next steps to be taken by the Government on this issue. These will include considering recommendations based on an analysis of their recent consultation on changes to the rules and then publishing a new circular setting out revised non-statutory rules as an interim measure.
We welcome these moves. However, we do not see why our amendment would undermine that process. We appreciate that there is still rather a lot of work to do to work out the terms of the effects, especially in terms of costs on local authorities and others to whom the rules are only commended. We do not want unnecessarily to increase the administrative burden on local authorities.
I set out in Committee why we felt that there was a lot of confusion and inconsistency of application surrounding the Crichel Down rules and why we felt that this amendment represented an important opportunity to put into primary legislation a provision regarding their improvement. So I do not understand why the Government would not want to take this opportunity to signal their commitment to a fairer and more consistent approach to the Crichel Down rules.
This amendment would give the Secretary of State an order-making power in terms of the application of the Crichel Down rules. It would not force him either to exercise that power or prevent the Government from introducing a more comprehensive set of changes to the Crichel Down rules at a later date. Certainly, we do not believe that this amendment either prejudges the analysis of the consultation or prevents parallel changes that Wales might want to apply. Without the amendment, I wonder how long it will be before the Crichel Down rules make it on to the statute book. I beg to move.
Lord Rooker: My Lords, as the noble Lord said, following our debate on 5 February, I wrote to him on 12 February setting out fully our reasons why in our view it would be premature at this stage to put in train primary legislation. The letter was copied to other noble Lords and placed in the Library. I do not intend to repeat its contents because they are now on the record.
Given where we are now in our review of the Crichel Down rules, we think that it would be premature to embark on primary legislation when we have not fully worked out all the necessary detail and the potential impact on disposing authorities. We need to give further thought to the scope of the legislation, including
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discussing parallel arrangements for the National Assembly for Wales. In particular, we need to consider how wide a power we should give to the Secretary of State: whether it should be open-ended or constrained by a statement of principles.
We are committed to rectifying the deficiencies in the current non-statutory system, which is why our first step will be to revise and update the current rules. I cannot go beyond what I set out in my letter, but I suspect that I may be required to give a further update at Third Reading, which I shall be happy to do if that is desired.
Lord Hanningfield: My Lords, I thank the Minister for that reply and for his suggestion that he will return to it at Third Reading. As I said earlier about the Crichel Down rules, I think that the Government announced a review something like six years ago. We are concerned that this may go on for another six years. I think that we should try to use the opportunity provided by this legislation to take a step forward.
However, I thank the Minister for his suggestion that he will come back to the matter at Third Reading. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 110 [Crown]:
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 145A:
Page 96, line 20, leave out subsection (2) and insert—
"(2) The amendment of an enactment by or by virtue of Part 8 applies to the Crown to the extent that the enactment amended so applies."
The noble Lord said: My Lords, I shall be brief so that I can spend more time on the next set of amendments. This amendment has become necessary as a result of noble Lords agreeing in Committee that Clause 109 should be inserted into the Bill to enable the Secretary of State to make an order amending any enactment where this is necessary to bring it in line with the provisions in Part 8. I beg to move.
Clause 114 [Grants for advice and assistance]:
Baroness Wilkins Baroness Wilkins moved Amendment No. 146:
Page 98, line 24, at end insert—
"() The appropriate authority may also make grants for the purpose of assisting any person to provide advice and assistance to regional planning bodies, local planning authorities and developers in connection with access issues for disabled people arising from planning applications, local development plans and frameworks and regional spatial strategies."
The noble Baroness said: My Lords, Amendment No. 146 would provide for central government funding to support local access groups in the same way that grants are to be made available to Planning Aid.
In Committee I asked whether the current wording of this clause would allow the Secretary of State and the National Assembly for Wales to give grants to local access groups, a question that I am not sure was answered. My noble friend on the Front Bench replied saying that there could be some potential unintended consequences of the proposed wording of my original

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amendment. Consequently the wording has been revised to rule that out. My noble friend did say that he was not unsympathetic to the aim of my amendment, and I hope that he will now elaborate.
Would my noble friend consider reinstating government funding for local access groups, withdrawn in 1998, given the renewed emphasis which government guidance places on consultation with local access groups for building awareness of inclusive design and assisting developers and local authorities alike to achieve inclusively designed buildings?
The ODPM's recent good practice guidance speaks of the importance of developers and local authorities liaising with access groups to achieve the most appropriate solutions for disabled people. It exhorts local access groups to build awareness of inclusive design issues within local authorities and to assist with training. Surely it is unreasonable to expect access groups to fulfil such key functions without providing any financial support from government.
Many local access groups, as I argued in Committee, run on fresh air and enthusiasm and face an uncertain and unsustainable future. Many local authorities help with funding or support in kind, but it simply does not go far enough and many disabled people fund participation out of their own pockets. In the disability movement, there is a saying, "Nothing about us without us". Local access groups made up of local disabled people provide disabled people with a voice and a direct input into the system in a way which no other organisation can.
I repeat a further point made in Committee: Planning Aid could not, and does not intend to, fulfil the remit of supporting local access groups. Therefore, a separate funding stream is essential.
I urge my noble friend the Minister to follow the example set by the Scottish Executive. Following an earlier grant to set up an umbrella organisation under the auspices of the Scottish Disability Equality Forum to provide support for local access panels, the Scottish Executive has recently announced an award of £525,000 for local access panels. This is to be distributed by the umbrella body to the 43 functioning access panels in Scotland, which means that each will receive about £12,000.
The Disability Rights Commission is currently undertaking research scoping the location, resources and experiences of existing local access groups, which will include recommendations on funding needs. Can my noble friend the Minister give me an assurance that serious consideration will be given to implementing any recommendations on funding stemming from this research? I beg to move.
10.15 p.m.
Lord Lucas: My Lords, I support this amendment totally. It would be immensely useful to anyone who wants to achieve the object of making more accessible the developments with which they are involved. Individuals cannot be expected to know what best practice is, the alternatives, the options, or what new
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thoughts have been developed elsewhere in the country on how facilities might be provided. It is extremely difficult, as an individual faced with a problem, to find sources of advice. I tried the other day to find a source of advice on how the Disability Discrimination Act applies to schools. Nobody could tell me. I talked to people at the Disability Rights Commission, but they did not know. There is no one to talk to. You could pay a solicitor several hundred pounds an hour, but they would not even recommend a particular solicitor. You can face such problems and try to search for some friendly advice, but simply be unable to find any. There are no signposts and nowhere to turn. It is extremely frustrating when you are trying, essentially, to do good.
I hope that the Government will see their way to funding such resources so that anybody who is involved in the development process and wants to help to make progress in the direction of increased access for the disabled and others is able to do so efficiently and quickly.
Lord Bassam of Brighton: My Lords, the noble Baroness, Lady Wilkins, is right: I expressed considerable sympathy for the amendment in Committee. I remain sympathetic, not least because in good measure what the Government are already doing goes some way to meet the point, particularly on funding, which is probably at the core of this amendment.
The amendment would allow grant to be made to a person for the provision of advice and assistance to regional planning bodies, local planning authorities and developers in connection with access issues for disabled people arising from the planning process. The purpose of draft Clause 114 is to allow the Secretary of State or the National Assembly for Wales to give grants such as planning aid to bodies which provide advice and assistance to members of the public on all aspects of the planning process. It will enable Planning Aid to become more proactive and will develop a greater role in targeting communities which traditionally do not get involved in the planning system, including disabled people and disability groups.
It is not our intention to give grants to those who provide advice to bodies which have the resources and expertise to manage the planning issues with which they are dealing, such as local authorities and regional planning bodies; nor to those which provide advice to developers.
Our good practice guide on planning and access for disabled people which was published last March following a recommendation by the Disability Rights Task Force already advises that each local authority should seek to appoint an access officer. I think I can fairly say that the better authorities—I am sure that they have some representation in the Chamber this evening—already attempt to achieve that very important objective. As a minimum, it recommends that each local authority should be able to call on appropriate professional advice whenever necessary, either through information and resource sharing with

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other local authorities or by the appointment of consultants with the appropriate experience. That guide also recommends that developers should appoint access specialists to their design teams. To assist this, the National Register of Access Consultants is a resource for building owners, occupiers, developers or planners seeking advice on a inclusive environment.
We recognise the valuable service that local access groups can provide to local authorities, regional planning authorities and developers by giving them the benefit of their personal and practical experience. But this service should not be used by organisations and private companies which have resources as a substitute for an access officer or specialist. We appreciate that most local access groups operate, as has been said, on a voluntary basis. That is why we advise local authorities in the guide not to place too large a burden upon them.
In our view, it should not be beyond the resources of the local authorities or the regional planning bodies and developers to pay the expense of access group volunteers or to support the group with contributions when they call on their service. I say that because, through the planning delivery grant, the Government have made an extra £50 million available to local authorities in the current financial year to improve their planning services. A further planning delivery grant of £130 million in 2004–05 and £170 million in 2005–06 is being made available. There has thus been a considerable expansion of resource which we think should be used in part to enable better representation to be made by access group volunteers.
The planning delivery grant is designed to drive performance improvement but not at the expense of quality. The grant is not ring fenced and can be spent as authorities see fit. The employment of an access officer could and. one might argue, should be financed through the grant. That is the direction our guidance suggests. Similarly, local authorities could use the grant to contribute to local access groups.
Our case is this: we are putting extra money into the planning delivery process. It is our belief that the decision on how that resource should be used should be made locally. We identify the need identified by the noble Baroness in her amendment and we hope that the extra grant that we have been making available to local authorities could and should in part be used so that access officers are taken on by local authorities so that they can match and meet best practice in this specialist area of planning expertise.
For those reasons, I hope that the noble Baroness will feel able to withdraw her Amendment No. 146. I was interested in the Scottish example. I had not been aware of that, but it is clearly something that we could consider. We should obviously look also at any follow-up research that has been undertaken to assess its impact.
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I hope that it is more than sympathy. It is backed by a solid cash commitment and a desire by the Government to see improvements regarding quality and access for groups which have been in the past excluded.
Baroness Wilkins: My Lords, I thank the noble Lord, Lord Lucas, for his kind support and the Minister for his reply which I found extremely disappointing. The extra money towards local authorities to provide access officers is welcome. However, an access officer in a local authority is a very lone person without the support of an access group to advise him and to deal with the huge variety of developments which he meets. I know that from my own local authority which has a good access officer but he is desperately in need of the support of a local group. Volunteers need training and informing. An access group run on the basis of volunteers is bound not to be as well informed as one which is sufficiently resourced.
I hope that the Government will consider the Scottish example. Although I am happy to withdraw the amendment, I shall return to the issue at Third Reading.
Amendment, by leave, withdrawn.
Schedule 6 [Amendments al the planning Acts]:
Lord Rooker Lord Rooker moved Amendment No. 146A:
Page 127, line 12, leave out paragraph 4.
The noble Lord said: My Lords, in moving the amendment, I speak also to Amendments Nos. 148A, 148B, 148C, 152 and 153.
Following amendments made to the Bill in Committee in this House which gave county councils a statutory role in the revised planning system in relation to regional spatial strategies, it has been decided that the provisions relating to statutory consultation between local planning authorities, regional planning bodies and county councils on planning applications would sit better on the face of the Bill in primary legislation rather than secondary legislation. That is the purpose of the amendments. I beg to move.
Lord Hanningfield: My Lords, I thank the Minister very much. It seems that our work on the early parts of the Bill has paid off. I thank him for the amendments. We agree with him on them.
Baroness Hamwee: My Lords, I join in the thanks. At the risk of being told that I do not trust anyone—it is not a matter of trust—perhaps I may ask a question on sub-paragraph (3)(a) which refers to,
"a development which would by reason of its scale or nature or the location … be of major importance".
Is it intended by the Government to define that more closely through regulations or other means? "Major importance" may be in the eye of the beholder.
The example which came to my mind when I read the amendment—it is not an exact comparison is that the Mayor of London is entitled to direct refusal

255
of certain planning applications. Those are basically strategic and major applications. They are defined carefully in secondary legislation. Is it a matter which will be left open to interpretation? I am not sure how I would define it more closely but I can envisage that there could be scope for argument.
Lord Rooker: My Lords, there is always scope for argument, even at the last minute when you look a gift horse in the mouth. I do not know. The provision is drafted fairly widely but whoever uses that subparagraph would have to make the case for a development. It refers to scale, nature or location. It could be small scale in an important location. There could be mix and match as a matrix. It is a little like the elephant on the doorstep: you cannot describe it but when you see it you recognise it. I cannot be more specific about that. Throughout the passage of the Bill, noble Lords have been asking us to put stuff on the face of the Bill, and here am I lifting a load of stuff from regulations on to the face of the Bill and I am still being queried.
I do not have an answer for the noble Baroness. In due course it may be a matter for the courts to decide if someone does not like it. The definition is fairly wide, but it does not mean that you can do what you want. You are restricted by having to define the scale, location and nature.
On Question, amendment agreed to.
10.30 p.m.
Baroness Hamwee Baroness Hamwee moved Amendment No. 146B:
Page 127, line 15, at end insert—
"Sections 82 to 87 (simplified planning zones) are omitted and Schedule 7 (simplified planning zones) is omitted."
The noble Baroness said: My Lords, this amendment is consequential on Amendment No. 139. I beg to move.
[Amendments Nos. 147 and 148 not moved.]
Lord Rooker Lord Rooker moved Amendments Nos. 148A and 148B:
Page 130, line 25, leave out sub-paragraph (4) and insert—
"() For paragraph 7 there is substituted the following paragraph—
"7 (1) A local planning authority must not determine an application for planning permission to which the consultation requirements apply unless it complies with sub-paragraph (7).
(2) The consultation requirements are—

(a) consultation with the RPB for the region in which the authority's area is situated if the development is one to which sub-paragraph (3) applies;

(b) consultation by a district planning authority with the county planning authority for their area if the development is one to which sub-paragraph (4) applies

(3) This sub-paragraph applies to—

(a) a development which would by reason of its scale or nature or the location of the land be of major importance for the implementation of the RSS or a relevant regional policy, or

256

(b) a development of a description in relation to which the RPB has given notice in writing to the local planning authority that it wishes to be consulted.

(4) This sub-paragraph applies to—

(a) a development which would materially conflict with or prejudice the implementation of a relevant county policy,

(b) a development in an area in relation to which the county planning authority have given notice in writing to the district planning authority that development is likely to affect or be affected by the winning and working of minerals, other than coal,

(c) a development of land in respect of which the county planning authority have given notice in writing to the district planning authority that they propose to carry out development,

(d) a development which would prejudice a proposed development mentioned in paragraph (c) in respect of which notice has been given as so mentioned,

(e) a development of land in relation to which the county planning authority have given notice in writing to the district planning authority that it is proposed to use the land for waste disposal, or

(f) a development which would prejudice a proposed use mentioned in paragraph (e) in respect of which notice has been given as so mentioned.

(5) The consultation requirements do not apply—

(a) in respect of a development to which sub-paragraph (3) applies if the RPB gives a direction authorising the determination of the application without compliance with the requirements;

(b) in respect of a development to which sub-paragraph (4) applies if the county planning authority gives a direction authorising the determination of the application without compliance with the requirements.

(6) A direction under sub-paragraph (5) may be given in respect of a particular application or a description of application.
(7) If the consultation requirements apply the local planning authority—

(a) must give notice to the RPB or county planning authority (as the case may be) (the consulted body) that they propose to consider the application,

(b) must send a copy of the application to the consulted body, and

(c) must not determine the application until the end of such period as is prescribed by development order beginning with the date of the giving of notice under paragraph (a).

(8) Sub-paragraph (7)(c) does not apply if before the end of the period mentioned in that sub-paragraph—

(a) the local planning authority have received representations concerning the application from the consulted body, or

(b) the consulted body gives notice that it does not intend to make representations.

(9) A relevant regional policy is—

(a) a policy contained in a draft revision of the RSS which has been submitted to the Secretary of State in pursuance of section 6(6) of the 2004 Act, or

(b) a policy contained in a structure plan which has effect by virtue of paragraph 1 of Schedule 8 to the 2004 Act.

(10) A relevant county policy is—

(a) a policy contained in a local development document which has been prepared in accordance with a minerals and waste scheme and submitted to the Secretary of State in pursuance of section 20(1) of the 2004 Act or adopted by the county planning authority in pursuance of section 23 of that Act, or

257

(b) a policy contained in a structure plan which has effect by
virtue of paragraph 1 of Schedule 8 to the 2004 Act.

(11) RPB and RSS must be construed in accordance with Part 1 of the 2004 Act.
(12) The 2004 Act is the Planning and Compulsory Purchase Act 2004.""
Page 132, line 24, leave out paragraph 28.
Schedule 8 [Transitional Provisions: Parts 1 and 2]:
Lord Rooker Lord Rooker moved Amendment No. 148BA:
Page 144, line 15, at end insert—
"The Secretary of State may by regulations make provision—

(a) for treating anything done or purported to have been done for the purposes of Part 2 before the commencement of that Part as having been done after that commencement;

(b) for disregarding any requirement of section 19 in respect of anything done or purported to have been done for the purposes of any other provision of Part 2."

The noble Lord said: My Lords, the amendment makes provision for local planning authorities to work on preparation of development plan documents before the Bill is commenced. It enables the Secretary of State to prescribe in regulations that actions taken before commencement of the Bill but carried out in pursuance of Part 2 of it will count towards the preparation of development plan documents. I beg to move.
Schedule 9 [Repeals]:
Lord Rooker Lord Rooker moved Amendment No. 148C:
Page 145, leave out lines 22 and 23.
[Amendment No. 149 not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 149A:
Page 145, leave out line 26.
[Amendments Nos. 150 and 151 not moved.]
Lord Rooker Lord Rooker moved Amendments Nos. 152 and 153:
Page 146, line 4, leave out "4(2) and 7"
Page 146, leave out lines 16 and 17.
Clause 120 [Commencement]
Lord Rooker Lord Rooker moved Amendments Nos. 154 and 155:
Page 100, line 5, after "subsections" insert "(2B),"
Page 100, line 16, at end insert—

"(2A) And the Secretary of State must not make an order which relates to section 90 unless he first consults and has the agreement of the Scottish Ministers.

(2B) The following provisions come into force on such day as the Scottish Ministers may by order appoint—

(a) sections 89 and 91 to 97;

(b) Schedule 5;

(c) section 116(8);

(d) in so far as relating to the Town and Country Planning (Scotland) Act 1997, section 117(2) and Schedule 7;

(e) section 118(2); and

(f) in so far as relating to that Act, to the Planning (Listed Buildings and Conservation Areas) (Scotland) Act 1997 or to the Planning (Hazardous Substances) (Scotland) Act 1997, section 119 and Schedule 9."

Clause 121 [Regulations and orders]:
Lord Rooker Lord Rooker moved Amendments Nos. 156 to 158:
Page 100, line 41, leave out "120" and insert "120(11" Page 100, line 41, at end insert—
"() an order under section 120(2B);"
Page 101, line 7, at end insert—

"(8A) A statutory instrument containing an order under section 120(2B), if it includes provision amending or repealing an enactment contained in an Act, must not be made unless a draft of the instrument has been laid before and approved by resolution of the Scottish Parliament.

(8B) In subsection (3), "enactment" includes an enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament and in subsections (8) and (8A), "Act" includes such an Act and "enactment" includes an enactment comprised in such an Act."

Clause 123 [Extent]:
Lord Rooker Lord Rooker moved Amendments Nos. 159 and 160
Page 101, line 20, leave out from "sections" to "extend" and insert "110(1), 117(2), 119 to 121, this section and section 124"
Page 101, line 22, leave out ", 118(2) and Schedule 5" and insert "and 118(2)"
House adjourned at twenty-seven minutes before eleven o'clock.

Official Report of the Grand Committee on the
  Companies (Audit, Investigations and Community Enterprise) Bill [H.L.]
  (First Day)
  Companies (Audit, Investigations and Community Enterprise) Bill [H.L.]

    The Committee met at half past three of the clock.
    [The Deputy Chairman of Committees (Baroness Cox) in the Chair.]
    The Deputy Chairman of Committees (Baroness Cox): Before I put the Question that the Title be postponed, it may be helpful to remind your Lordships of two points of procedure for today's Committee stage. Noble Lords will speak standing; and the House has agreed that there shall be no Divisions in the Grand Committee. Therefore, unless an amendment is likely to be agreed to, it should be withdrawn.
    I should explain what will happen if there is a Division in the Chamber while we are sitting. The Committee will adjourn as soon as the Division Bells are rung and will resume after 10 minutes.
    Title postponed.
    Clause 1 [Additional requirements for recognition of supervisory bodies]:
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 1:
    Page 2, line 28, after "action" insert "available to the body"
    The noble Lord said: I start with two detailed amendments—Amendments Nos. 1 and 4—which look into the detail of the new provisions in Clause 1 of the Bill which is to be inserted into Schedule 11 to the Companies Act 1989. I have a number of general comments to make on the new structure for the recognition of supervisory bodies as set out in Clauses 1 and 2, but I shall reserve them for our debate on Clause 1 stand part.
    I propose to consider one aspect of the proposed new paragraph 12A which sets out the process for independent investigation for disciplinary purposes of public interest cases and additional arrangements for those disciplinary investigations, as set out in paragraph 20.
    The amendments stem from discussions that we have had with the Institute of Chartered Accountants in England and Wales. One of the new criteria for recognition as a supervisory body is participation in independent arrangements for the investigation and taking of disciplinary action in relation to public interest cases. As I understand it, that alters the existing situation where to qualify as a supervisory body, a body must have in place rules and practices relating to discipline of its members which are fair and
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    reasonable and effective arrangements for the investigation of complaints—see Schedule 11, paragraphs 11 and 12.
    Now we have a requirement for additional independent investigations which will be carried out by one of the new arms, presumably, of the FRC. The institute has commented that it is fully acceptable that the Accountancy Investigation and Discipline Board (AIDB) disciplinary tribunals should be able to exercise all the supervisory bodies' disciplinary powers. Indeed, the existing paragraph 12(2) in Schedule 11 to the 1989 Act already states that,
    "The arrangements may make provision for the whole or part of that function to be performed by and to be the responsibility of a body or person independent of the body itself'.
    However, the institute stresses that the penalties available to the AIDB disciplinary tribunals should not be different from those that the members of the body have agreed to allow their institute to impose on them. The Minister may argue that that position is implicitly recognised by the words in lines 30, 31 and 32 on page 2, which are that,
    "that decision is to be treated as if it were a decision made by the body in disciplinary proceedings against the member".
    For clarity sake, we believe that it should be more explicit. No penalty should be imposed which is not provided for in the disciplinary scheme of the body itself. The accountancy bodies have confirmed to us that they have an extensive range of powers, all of which they accept should be available to the AIDB disciplinary tribunals without restrictions. Therefore, I beg to move.
    The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville): Perhaps I may say at the outset how grateful I am to noble Lords opposite for their constructive approach in preparing for this Committee; an approach which is shared by the Government and which I trust we can maintain throughout the Bill's passage through the House. For their part, the Government are keen to improve the Bill wherever possible and we shall consider all proposed amendments. I can assure the Committee that I shall listen to the arguments with an open mind.
    Having said that, I turn to Amendments Nos. 1 and 4 with a fairly closed mind, as I shall explain. I do not believe that these amendments are necessary or desirable. I shall not clarify them on the lines suggested by the noble Lord. I shall explain why. The aim of the provisions in respect of independent investigation and discipline is to set out the minimum requirements for appropriate independent disciplinary arrangements. These cover what we see as the most important elements of such arrangements—the functions of the arrangements, their transparency and their independence. The functions of the arrangements are set out as: the investigation of public interest audit cases; the holding of disciplinary hearings where it is considered desirable; and the taking of decisions as to whether—and if so, what—disciplinary action should be taken.

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    I consider that it is important that the sanction imposed by a disciplinary tribunal in a particular case should be the one that is appropriate for the failure in that case, taking into account all the relevant circumstances. The sanction imposed should be driven by the conduct, not by the membership of a particular body. One potential effect of the amendment is that the maximum sanctions that were available to disciplinary tribunals in respect of the same conduct could differ, depending on which supervisory body an individual was a member of. I believe that such a situation would not be in the public interest.
    So, we are explicitly saying that we do not think that because a particular recognised supervisory body does not have a specific disciplinary procedure, that is no reason why the Accountancy Investigation and Discipline Board should not be able to use it. When one looks at the matter in that light, it would be unfair if that was the situation.
    Lord Hodgson of Astley Abbotts: The Minister's last point was a powerful argument. I was not aware that different supervisory bodies had different penalty ranges. We should like to check with the various recognised bodies to explore with them what the Minister has said and to see their reactions to it. Meanwhile, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    On Question, Whether Clause 1 shall stand part of the Bill?
    Lord Hodgson of Astley Abbotts: I rise to speak to the Question whether Clause 1 stands part as a general introduction to Chapter 1 of the Bill. I tabled the stand part debate in part for my own benefit but also for the benefit of the wider public outside the House. As I emphasised, as did many other noble Lords, at Second Reading, the Bill tackles only a very small part of company law.
    We know that in 1998 the Government believed that there was a pressing need to overhaul company law in its entirety since it was, in another Minister's words,
    "encrusted with amendments in case law over generations".
    Six years on we are perpetuating the encrustation process with the Bill under discussion today.
    The first 22 clauses create another layer of amendments in three specific areas of company law: auditors, accounts and reports and investigations. I have spent the past two months or so trying to get my head around those 22 clauses. It is a bewildering and at times a depressing activity. In some places one is required to turn to the Companies Act 1989, which itself amended parts of the 1985 Act. Unless one has immersed oneself in company law since the 1985 Act and can therefore track the changes and the evolution process of which the Bill is the culmination, it is very difficult to comprehend.
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    I found myself at times wanting to table an amendment only to be told that the provision or requirement already existed in some small section buried in the depths of the 1985 Act. It would be appropriate at this juncture to extend my thanks to Keith Masson and the Bill team, who have been an enormous help in responding to a variety of queries of this nature. Their chart, which is on the wall of the department, is an extremely valuable and useful illumination.
    On the basis that it has been difficult for me to understand, I thought that it would be helpful to extend such illumination to the outside world and to allow the Minister to put on the record in plain and simple terms the changes that Clauses 1 to 5 make to the current system—that is, changes to the existing self-regulatory auditing profession and in the creation of a statutory element through the POBA. For that reason I have tabled a separate clause stand part debate to both Clause 1 and Clause 3.
    I accept that some of what I shall say involves Clause 2 but it is almost impossible to disentangle Clauses 1 and 2 and I cannot have a two-clause simultaneous stand part debate.
    Clause 1 amends Part 2 of Schedule 11 to the Companies Act 1989 by setting out additional requirements that accountancy bodies must meet in order to be recognised as supervisory bodies for auditors. These are: the setting of standards relating to professional integrity and independence; the setting of technical standards; the independent monitoring of audits of listed and other major companies; and the independent investigation for disciplinary purposes of public interest cases. Perhaps in confirming that in his reply, the Minister will also confirm that their existing powers of supervision and recognition remain unchanged.
    Clause 2 then expands on these four areas in a new Part 3 to Schedule 11, which sets out the arrangements. The emphasis in Clause 2 for the arrangements for carrying out these four new functions is on the fact that they must be done independently of the main body. The clause headings here feature the word "independent" at the beginning of nearly every clause. I am not quite sure how that will work in practice. For instance, let us take the Institute of Chartered Accountants in England and Wales. Under Part 2 of Schedule 11 to the 1989 Act, it cannot be recognised as a supervisory body for the accountancy profession unless it fulfils a number of requirements. It has to have rules, arrangements and standards that deal with the qualification of auditors, their professional integrity and independence, technical standards, monitoring and enforcement of compliance with its rules, discipline and investigations et cetera.
    On top of that, the ICAEW will now have somehow to duplicate four of those provisions via arrangements done independently of itself. To elaborate, paragraph 10 of Part 2, Schedule 11 to the 1989 Act reads:
    "The body must have adequate arrangements and resources for the effective monitoring and enforcement of compliance with its rules".

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    That is to say, to make sure that only those with appropriate qualifications undertake company audit work and that standards are maintained et cetera. On top of that—I refer to subsection (4) of Clause 1—we now have the newly proposed paragraph 10A, headed,
    "Independent monitoring of audits of listed and other major companies",
    on page 2, beginning at line 6, with paragraph 19 at page 3, line 19 in Clause 2. Paragraph 19(1) states that the arrangements for independent monitoring of audits of listed and other major companies,
    "referred to in paragraph 10A(1) are appropriate funded arrangements—

    (a) for enabling the performance by members of the body of company audit functions in respect of major audits to be monitored by means of inspections carried out under the arrangements, and

    (b) for ensuring that the carrying out of such monitoring and inspections is done independently of the body".

    My question to the Minister is simply this: if we already have paragraph 10 which says that the ICAEW must make sure all its members comply with its rules, why should we have a provision saying that the ICAEW must make arrangements for further independent monitoring of how its members perform company audit functions for listed companies?
    Currently, accountancy firms have a statutory obligation to carry out company audits in accordance with the rules set down by the recognised supervisory body, and the body has a duty to monitor that. Why then do we need this new independent third check? How will this be carried out independently of the recognised supervisory body? Presumably that means delegating to another outside body. How does this fit in with the new regulatory structure for audit and accountancy under the umbrella of the FRC; that is, the Auditing Practices Board, the Accounting Standards Board, POBA et cetera?
    I make the further assumption that this "independent monitoring" will be done by one of the branches of the FRC—POBA or the FRRP. This would tie in with Clause 4(5) because the Explanatory Notes talk about POBA being involved in functions under the arrangements of paragraphs 17, 18, 19(1) or 20(1) of Schedule 11. But if that is the case, I am unclear how it will work because, as I understand it, POBA and the bodies like it will be set up by and under the FRC, whereas what is required by Part 3 is independent monitoring—page 3, lines 19–20—not the product of arrangements made by recognised supervisory bodies. This imposition of statutory regulation under the FRC to complement the already existing self-regulation through the recognised supervisory bodies runs the risk of creating a complicated, multi-layered regulatory system. I think that all Members of the Committee would benefit from further clarification of how the measure will work in practice.
    It is terribly easy to skim over Clauses 1 to 5 because they are innocuous enough—we are all for independent monitoring and standard setting, you might think—but do they really add anything to what already exists and will they improve efficacy and
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    effectiveness? If we are not clear that they will, are they strictly necessary? What has prompted them beyond a wish to appear to be making a change? How will the new provisions sit side by side with the new reformed FRC?
    Can the Minister tell us what has changed to make this extra layer of independent supervision necessary in terms of standard setting, monitoring and discipline? Will it not be an added burden, administratively and financially, for recognised supervisory bodies? We know from paragraph 22 in Clause 2, which defines "funded arrangements", that the bodies in question must fund these independent arrangements.
    I finish with some comments on the arrangements set out in paragraphs 17 to 22 on pages 3 and 4 of the Bill. Clause 1 provides for the establishment of what appear to be, although it is by no means clear: independent bodies to set standards for the professional behaviour—paragraph 17; technical standards—paragraph 18; and independent monitoring of major audits—paragraph 19. There is no real guidance as to how those bodies are to be appointed, who their constituent members will be or what their qualifications will be. There is negative guidance in paragraph 21(2) on page 4 of the Bill, which is helpful so far as it goes. Therefore, the way in which these bodies are constituted appears to be down to the accountancy profession. This is a complicated clause and I believe that the Committee would benefit from some clarification on these general points.
    3.45 p.m.
    Lord Freeman: I declare an interest in relation to the Bill as a former partner of PricewaterhouseCoopers but now a consultant. However, I speak for myself and not for the Institute of Chartered Accountants in England and Wales. Rather than repeat the same points of principle time and again, it may be for the convenience of the Committee, and certainly of the Minister, if I follow the example of my noble friend Lord Hodgson and simply outline my central concern relating to a number of amendments.
    I believe that the profession as a whole—I refer to the chartered accountants profession in its different forms and guises in different parts of the United Kingdom—welcomes the main thrust of the Bill, although there are many issues which remain to be decided. I believe that the principle of independent regulation is right because it provides reassurance and underlines the importance of the perception of the independence of not only investigation but also regulation and standard setting.
    In the Second Reading debate, in referring to the reasons for introducing the Bill, the Minister very helpfully said that two of the key principles were,
    "the perception of independence from the accountancy profession".—[Official Report, 8/1/04; col. 259]—
    that is, the perception of independence of the supervisory regulatory bodies—and, secondly, the simplification of the regulatory structure. With regard to the second point, I am bound to say that few can

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    argue—the noble Lord, Lord Borrie, above all, has more experience of the various structures than all of us around the table—that with the Bill we have made a major step forward in terms of simplification. In the application of the responsibilities of the individual bodies, as my noble friend Lord Hodgson said, the devil is in the detail.
    The central point that I wish to put to the Minister—it runs through a number of amendments to which I may not need to speak—is the importance of ensuring a spirit of partnership and co-operation between the supervisory and regulatory bodies set up under the aegis of this legislation and the profession. I know that that is intended, but when we talk about the perception of independence, primarily from the standpoint of—dare one say it?—the SEC and that of bodies abroad, it is also important to bear in mind the perception towards the legislation of the professionals in this country.
    Therefore, I rather hope that the Minister will commence this Committee proceeding by underlining what I know he believes in—that is, a spirit of partnership and co-operation with the accountancy profession. There are a number of examples to which we shall come. On the face of it, Amendment No. 8 does not appear to be hugely important, but it is important to the profession to signify that there is at least a perception of possible co-operation. I appreciate that when one reads something cold, it can sometimes connote an attitude that was not necessarily meant to be conveyed. However, the Minister will remember his very helpful comment at col. 260 of the Official Report, when he said:
    "The professional accountancy bodies that are recognised to supervise auditors will have to sign up to such standards and arrangements".—[Official Report, 8/1/04; col. 260.]
    One can read that both ways; perhaps it is correct in a legalistic sense. But, again, I would cite that as evidence of a possible perception in the profession that it is a "take it or leave it" approach.
    Another example is the compulsory levy in Clause 17. I appreciate that those are reserve powers. As my noble friend Lord Hodgson said, the two investigatory bodies—the Audit Inspection Unit and the Quality Assurance Directorate, which is run by the professions—will need to co-operate. It is important that there is seen to be a sense of co-operation and partnership at the outset.
    I conclude by agreeing with the Minister when he said on Second Reading that the accountancy profession has, by and large, maintained very high standards. I accept that the Government are right to take the initiative in pre-emptively setting out to avoid problems that could arise in this country by simplifying the procedure and giving new statutory responsibilities to the various bodies. But a signal from the Minister in this clause stand part debate might help accelerate and facilitate later debate.
    Lord Sharman: I, too, must declare an interest, and I should probably declare an advantage as well. I am the former chairman of KPMG International, and I
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    lived through much of the negotiation and debate that resulted in the arrangements before us. I give a very strong welcome to the Bill—I think it is long overdue. It gives the desperately needed statutory backing to an independent system of regulation for which many of us have argued for some time. Public confidence in the accounting profession, however much it may be dented—and that is a matter of opinion—can help be restored only if we have transparent and clearly independent regulation.
    I reiterate what I said on Second Reading about the need for a complete overhaul. I endorse the comments of the noble Lord, Lord Hodgson. Trying to understand the effect of this Bill on legislation can, at times, be very difficult. We desperately need the companies' legislation to be completely overhauled.
    That having been said, I think it is as well to note that the Bill is welcomed by most in the accounting profession. You will never get 100 per cent support for something such as this. I look forward to the Minister's comments, which I hope will clarify the points made.
    Lord Borrie: I apologise as I was unable to attend the Second Reading debate. I had the benefit of reading what noble Lords who have spoken this afternoon said in that debate. I welcome the desire of the noble Lord, Lord Hodgson, to discuss whether Clause 1 should stand part of the Bill. I undoubtedly want it to stand part because I think that, along with Clause 2, it is absolutely fundamental. However, this gives us an opportunity, which noble Lords who have already spoken have taken, to make some general points about the scheme.
    The noble Lord, Lord Freeman, kindly suggested that I had some knowledge of this. He exaggerated, but I was the chairman of the Accountancy Foundation for a couple of years, which appears at the top left of the old regulatory structure. It was absorbed into the Financial Reporting Council almost a year ago, but it had achieved some things. It appointed a splendid range of people to form part of the review board, the Accountancy Investigation and Discipline Board, and so on. They were all appointed by the Accountancy Foundation, which was an independent body and had a majority in every case of independent people on it. Although I have not been able to find where it says so in the Bill, any more than has the noble Lord, Lord Hodgson, I assume and hope that the Minister can reassure us that there is no question but that appointments to all key bodies of the new statutory regime will ensure a majority of independent people.
    If I may make a somewhat controversial point in the presence of the noble Lord, Lord Sharman, and, for that matter, the other noble Lords who have spoken, one of the problems has been that the five accountancy bodies are often barely on speaking terms. If they are on speaking terms, they do not seem able to amalgamate, but seem to spend a lot of time at war with one another, as distinct from doing the best for their members in trying to ensure that they present a common front to the Government. That is a slightly facetious point. However, it has been unfortunate over

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    the years that, although occasionally talks have taken place with a view to a merger or amalgamation, it has never happened. My experience of the Accountancy Foundation was that, when we wanted to talk to the accountancy bodies, we really had to talk to all of them all the time, and that that was not always easy. The pre-eminent body, if I may put it that way—the Institute of Chartered Accountants in England and Wales—had its magnificent building and its staff, while the others were not quite so well geared up.
    As the noble Lord, Lord Sharman, said, in this day and age when public confidence is so important and when we know what has happened at various accountancy firms, especially on the other side of the Atlantic, we must have firm public confidence in the auditing profession. Even if there had been an amalgamation of the various accountancy bodies, there would be a need in the public interest to have an injection of very strong majority—and I use the word as a generalisation—independent people on the various hoards, organising the arrangements that Clause 2 specifies. Some of those arrangements, such as auditing standards, are more obviously ones that the professional people themselves must initiate with a modicum of input from others. On the other hand, with investigation and discipline, especially in the so-called public interest cases, there should clearly be an injection of independent members.
    The development last year has resulted, after considerable discussion within the department and between the department and the profession, in what is now contained in Clauses 1 and 2, which are really the basics of the new structure and which are excellent. The phrase "co-operation and partnership" between the arrangements and the profession refers to something that can now be achieved. When I was chairman of the Accountancy Foundation, my dealings with the profession sometimes involved not co-operation and partnership but something of a war in order simply to get the minimum of finance that we felt was necessary to carry out the arrangements. Sometimes the verbal good will that was available from the profession was not backed up by money or real effort; it was half-inclined to admit that public interest required the new-fangled arrangements, but it was not all that pleased with them.
    Of course, the profession had to carry its membership and dun it for more money to run the scheme when subscriptions were going up anyway. There was that problem. However, I can see now, with the requirements of this Bill that put the arrangements on a statutory basis, that there is scope for the partnership and co-operation of which the noble Lord, Lord Sharman, spoke. I may sound patronising—and if so. I am sorry—but I believe that the profession is mature enough to be able to provide that co-operation and partnership from its side.
    4 p.m.
    Lord Sainsbury of Turville: Perhaps I, too, may use the clause to make one or two general points about the way we are approaching the Bill. I want to make it clear that the objective of the provisions is to protect
    GC 22
    and improve the quality of accounts and audit by ensuring that the audit profession is regulated in the most effective way. The role of independent auditors is extremely important in ensuring high standards of financial reporting. It is therefore important that the public can have confidence in their impartiality and effectiveness.
    When deciding whether to legislate, the Government recognise that action should be taken only where it is appropriate and that it should be proportionate. In particular, we took account of the fact that the review of the regulatory regime of the accountancy profession found no evidence that the current regulatory system was seriously flawed. We therefore have not tried to bring forward heavy-handed and disproportionate regulation but rather to concentrate on the concerns which the review found about the perceived independence of the key aspects of the current arrangements.
    This independence is important not just within the UK but internationally. I do not want UK auditors having to comply with onerous requirements of overseas regulators because those regulators do not believe they can rely on the independence of the UK regime. The provisions considered alongside the non-legislative action that has been taken will give the UK stronger, more independent and effective regulation without imposing disproportionate burdens on UK businesses.
    To take the point made by the noble Lord. Lord Freeman, we see a partnership and co-operation as being fundamental between the recognised supervisory bodies in this account and the regulatory framework. But that involvement, co-operation and partnership must in no way jeopardise the independence of the process. We will turn to the issue when we debate involvement, but if it jeopardises the independence, the whole point of a major part of the Bill is lost. Independence is central to what we are arguing here and is key.
    Clause 1 introduced additional requirements that professional accountancy bodies must meet in order to be recognised as supervisory bodies for auditors.
    Part 2 of Schedule 11 to the Companies Act 1989 sets out a number of requirements that professional accountancy bodies must meet in order to be recognised as supervisory bodies for auditors. These requirements cover both the rules that the body must have in place governing the eligibility of persons to seek appointment as company auditors and the conduct of company audit work.
    In its review of the regulation of the auditing and accountancy professions, the Government concluded it was desirable that the independent regulation and review of audit should be strengthened. Clause 1 therefore introduces new requirements for recognised supervisory bodies to participate in independent arrangements for setting audit standards in relation to

    GC 23
    both technical matters and to ethical matters relating to the integrity and independence of auditors; monitoring audits—
    The Deputy Chairman of Committees: There is a Division in the Chamber and the Committee stands adjourned for 10 minutes.
    [The Sitting was suspended for a Division in the House from 4.3 to 4.13 pm.]
    Lord Sainsbury of Turville: I was explaining that Clause 1 therefore introduces new requirements on recognised supervisory bodies to participate in independent arrangements. First for setting audit standards relating both to technical and ethical matters regarding the integrity and independence of auditors; secondly, monitoring audits of listed and other major companies; and, thirdly, investigating and disciplining auditors in relation to public interest cases.
    It may be helpful if I explain the fundamental structure of the Bill. I was distraughtar that to hear the noble Lord did not find ploughing through the initial clauses of the Bill to be a life-enhancing experience. Until I heard him speak I thought I had eventually got the matter clear. But let me see if I can explain. I refer to the chart he referred to, which I think is the only possible way for those who are not in the thick of it to understand what the new structure is and how it relates to the previous one.
    The key issue is the concept of the recognised supervisory bodies having funded arrangements with the regulatory structure, which has now been put in place and which involves the Financial Reporting Council and the boards which report. They are the Professional Oversight Board for Accountancy, the Accountancy Investigation and Discipline Board, the Auditing Practices Board, the Accounting Standards Board and the Financial Reporting Review Panel Ltd. That structure has essentially been put in place. It has a heavy independent element to it, which I think we all feel is right. The recognised supervisory body reaches a funding arrangement with the regulatory framework. In that way, we gain the necessary independence.
    Clause 2 sets out the criteria that those arrangements must meet, the main one being that they should be independent of the supervisory body. Together, these clauses strengthen the independence of the regulatory regime for auditors.
    The additional requirements introduced by this clause represent an important strengthening of the independence of the regulatory regime for auditors, especially in relation to large public interest companies. This increased independence is critical to rebuilding and maintaining market confidence in the reliability of the information on which investment decisions are based, a confidence that was badly knocked by the collapse of Enron and WorldCom. And it is essential that if the UK regulatory regime is to continue to match the best in the world.
    GC 24
    All the questions that we shall deal with later in the Bill—for example, involvement—relate to this central clause. It sets out the relationship between the registered statutory bodies and their funding arrangements with the regulatory framework. I hope that that is now a clear part of the Bill.
    4.15 p.m.
    Lord Hodgson of Astley Abbotts: It is a great relief when one finds that the noble Lords, Lord Borrie and Lord Sharman, and my noble friend Lord Freeman have similarly found the proposal within the clause not immediately clear. I can assure the noble Lord, Lord Borrie, that it was not our intention to blow a hole in the Bill by objecting to the Question that the clause shall stand part, but merely to debate and ventilate the issues.
    I accept the Minister's comment that we must demonstrate the independence of the UK's accountancy and auditing standards on an international stage and at an international level. I am also grateful to him for having read into the record the chart as best he can. That will help people because it is dry experience and difficult to tie the names of the real-life bodies to the clause.
    Clause 1 agreed to.
    Clause 2 [Arrangements to which additional requirements for recognition relate]:
    Lord Hodgson of Astley Abbotts moved Amendment No. 2:
    Page 3, line 33, leave out from "securities" to "or" in line 36 and insert "are a constituent of the FTSE-Actuaries 350 share index"
    The noble Lord said: We turn to the independent monitoring of audits of listed and other major companies. As we discussed during the previous debate, Clause 2 sets out the details of the arrangements for the extra supervisory duties which a recognised supervisory body must undertake independently. One of these, under new paragraph 19, is the independent monitoring of audits of listed and other major companies.
    The amendment queries the definition under paragraph 19(2)(a) of "major audit". Under that paragraph, the extra independent monitoring and inspection must be arranged by the recognised supervisory body for all company audit functions which its members carry out for companies "any" of whose securities are traded on the official list as defined by the Financial Services and Markets Act.
    Our query is the parameters that have been drawn in the definition of "major audit" in sub-paragraph (1)(a). It is worthwhile considering what companies would be covered. There are approximately 2,700 listed companies, of which 750 are on the alternative investment market—the AIM. It would be helpful to have the Minister's views on whether all of those are to be subject to additional independent monitoring. The official list excludes AIM companies—certainly from the point of view of tax laws and one's eligibility for capital gains tax relief.
    Perhaps while we are dealing with AIM we might also look at the still more junior market, OFEX, an unrecognised market. There is nevertheless a market, so will "listed" sweep up such companies? This is a probing amendment tabled for clarification and I hope that the Minister can shed some light on the matter.
    In the spirit of helpfulness, we want to offer an alternative because in no way do we want excessive regulation and supervision where it is not warranted. On that basis, we believe that in limiting "major audit" to the constituents of the FTSE 350 index, we would be striking a better balance. According to the Stock Exchange, the FTSE 350 index covers a significant percentage; that is, 96.5 per cent of the whole market capitalisation. At the same time, that would relieve the burden of further independent monitoring from the other 85 per cent of listed companies which are not in the FTSE 350.
    One final detailed point is that the clause as currently drafted refers to a company "any" of whose securities have been admitted to the official list. So if a company's ordinary shares were not listed but it had, say, a small issue of preference shares or debt securities which had been listed, would this require the independent monitoring of the company where the ordinary shares had not been listed? It would be worthwhile picking up that small point. I beg to move.
    Lord Sainsbury of Turville: The effect of these amendments would be to limit the required minimum scope of the independent monitoring arrangements to the audits of the FTSE 350 companies. The aim of the provisions in respect of monitoring Clause 2 is to strengthen the independence of a key aspect of the regulation of audit. We believe that this is necessary to rebuild confidence in the reliability of financial information provided by companies following the collapses of Enron and WorldCom.
    It is important that those carrying out the arrangements should focus their attention and resources in the areas in which an audit failure is likely to have the most significant adverse impact on the economy. However, I consider that the amendment goes too far in limiting the minimum requirement relating to the audits which would be the subject of independent monitoring under the arrangements. The effect of the provisions is to provide for the independent monitoring of particular audits. I believe it is right and that such a positive development should not be unduly restricted.
    I believe that if monitoring under the independent monitoring arrangements were limited to the FTSE top 350 listed companies, this would not provide the necessary degree of public reassurance that the audits of companies whose shares are publicly traded are subject to monitoring that is clearly independent of the recognised supervisory bodies. We are debating whether we limit this to the 350 FTSE companies, or take that up to the 1,200 companies which the provision, as drafted, would cover. It does not cover AIM, which is why the figure is 1,200 rather than over 2,000.
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    It is also important to look at the international context where the independent oversight of audit firms, particularly those firms that audit companies whose securities trade in public markets has assumed greater importance than ever before. I believe that it is in all our interests to ensure that the UK remains at the forefront of best practice.
    That is particularly important in relation to the work we have been doing in partnership with the audit firms and with our European colleagues, and through the European Commission, to persuade the American regulators to adopt a pragmatic approach. It is important, not least to avoid unnecessary and overlapping regulation, that the US can rely to the maximum on our own regulatory systems. That is the stated intention of the new US Public Company Accounting Oversight Board. We believe that our comprehensive and high standard of regulation, supported and strengthened by the provisions of the Bill, should provide a basis for a sensible arrangement with the US.
    Lord Hodgson of Astley Abbotts: I am slightly disappointed. What we are trying to do is to get at the bulk of the area where the risk is. I am grateful to the Minister for his reassurance that AIM and OFEX will not be included. That is good news. I should like to readjust my figures, which I cannot do on my feet—my mental arithmetic is not good enough—to work out what proportion the 350 FTSE index represents of the 1,200 companies to which the Minister refers. I may return to the matter at a later stage to see whether I can persuade him that he is using a sledgehammer to crack a very small nut at the bottom end of the listed market. However, for the time being, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Hodgson of Astley Abbotts moved Amendment No. 3:
    Page 3, leave out lines 37 and 38.
    The noble Lord said: I shall speak to Amendments Nos. 3, 6 and 7. These focus on the second part of the "major audit" definition in new Part 3, paragraph 19 of Schedule 11 to the Companies Act 1989. At this stage this is merely a probing amendment. We do not wish necessarily to strike out a "public interest" test from the Bill, but we should like to hear some thoughts from the Minister about the drafting of this second criterion and the definition that has been adopted. We believe that it is fairly woolly and open to ambiguity.
    We are told that "major audit" also includes,
    "(b) any other company in whose financial condition there is a major public interest".
    What does that mean you may well ask? If you turn to paragraph 20(2) to seek clarification, the matter becomes even more opaque:
    "'public interest cases' means matters which raise or appear to raise important issues affecting the public interest".
    Frankly, this is a circular definition.
    The Minister will no doubt tell me that it is very hard to define public interest. I note, however, that in the Government's company law White Paper in 2002 there was a proposed criterion for public interest which was dependent on whether the company was public or private. For public companies the criteria proposed were two out of three of the following: turnover of more than £50 million, balance sheet total of more than £25 million, employees more than 50. For private companies the criteria proposed were two out of three of turnover of more than £500 million, balance sheet total of more than £250 million, employees more than 5,000. We do not advocate the use of these specific criteria in this clause but merely draw it to the Minister's attention in view of working along the same lines to define "public interest" in the Bill before us.
    It is not even clear from the drafting who will adjudicate which companies would fall into the category of "major audit" under sub-paragraph (2)(b) because their financial condition is of "major public interest". I presume this would be FRRP or other independent body charged with the independent monitoring of audits under paragraph 19, but it is by no means obvious from the drafting of the clause. Is there a right of appeal against independent monitoring if it is disputed that the company in question falls into that category?
    Amendment No. 6 is concerned with the phrase "or appear to raise": it suggests that a company might actually not raise issues affecting the public interest. In those circumstances a company might be classified as a major audit company for the purposes of paragraph 19, and therefore subject to independent monitoring and regulation, on the basis of a wrongly assumed public interest. Our amendment would leave out "or appear to raise": in the interests of tighter drafting we believe those words to be superfluous.
    Can the Minister give us some examples—perhaps his officials have prepared some examples—or criteria by which public interest can be judged? What are the "important issues" of public interest that the Minister envisages being covered by this definition? We are not quite sure of the drafting here and suggest "significant" as an alternative word as it is less subjective. Will there be some guidance provided for recognised supervisory bodies so that they know which companies' audits must be subject to independent monitoring under these provisions?
    At the moment we fear that the drafting in subparagraph (2) of paragraph 20 on page 4 is too open-ended and could be interpreted in a number of very different ways. There are a number of areas of law where public interest has been examined by the courts, the principal one that springs to mind being invasion of privacy cases and cases involving the press generally. Is it intended to look to these for guidelines? Or in the case of this particular legislation, is it purely financial as proposed in the company law review? We need some clarification on this definition. I beg to move.
    4.30 p.m.
    Lord Borrie: I am glad that the noble Lord, Lord Hodgson, has indicated that this is a probing amendment and that he does not actually want to get rid of the distinction between public interest cases and other cases. It would be unsuitable for the full panoply of public hearings and the full independent examination and investigation of discipline cases—for all matters of discipline of members of the accountancy professions—to come before this body. It would be overwhelmed with cases. But the public interest, as the noble Lord, Lord Sharman, and other noble Lords said in the earlier debate, arises from a number of situations in which confidence of the public is involved because auditing standards appear to have been breached. I refer especially to situations in which there is a suspicion of fraud, and that sort of thing. That must raise a question about something more than simply the relationship between the auditor and his company or, for that matter, the auditor and his professional body.
    I want to indicate two things. First, I know that it is difficult to define public interest. The Minister may be able to come much closer to what the noble Lord, Lord Hodgson, is seeking than I can. However, I hope that he does not suggest the possibility of companies being dealt with according to their size, where an arbitrary line is drawn, with public interest above and not below the line. That would be unwise. Secondly, with Amendment No. 6, the noble Lord wants to delete the words in lines 19 and 20 on page 4, "or appear to raise". It seems to me that, at the start of an investigation, it may not be clear whether public interest matters are involved; it may become clear during the course of an investigation that that is so. It would be a pity if it had to be absolutely clear that public interest was involved right at the very beginning of any disciplinary case.
    Lord Freeman: On a point of clarification and in an attempt to be helpful, will the Minister confirm that if it were decided not to proceed with an investigation because the judgment was that it was not of sufficient public interest, there could still be and might well be an investigation anyway, by the Quality Assurance Directorate? It is not a question of there being an investigation on that basis or no investigation at all; there is a continuum between the regulatory body, the AIU, and the QAD, which is a professional body that might consider issues that just fell outside the definition.
    Lord Evans of Temple Guiting: A number of interesting questions have been raised, which I shall try to answer.
    The aim of paragraphs 19 and 20 is to set out the minimum requirements for independent monitoring and disciplinary arrangements. That point has come through in some of the amendments that we have discussed already. As with some of the amendments that preceded them, the effect of the amendments would be to limit unduly the minimum application that monitoring and disciplinary arrangements would have to cover in order to be appropriate arrangements.

    GC 29
    Amendment No. 3 would limit the required scope of the monitoring arrangements to the audits of listed companies. It is right that those carrying out the monitoring arrangements should focus their attention on areas where audit failure is likely to have the most significant adverse impact, but I believe that the amendment limits the scope of the arrangements to too small a group. Audits of listed companies are, by nature of their listing, considered to be major. But it is not sensible to make listings the sole consideration of whether an audit is major. There are likely to be, and there are, other companies that are not listed but whose importance is such that their audits must also be considered as major. It would be wrong to exclude companies with large-scale operations, for example, just because they are not listed.
    The noble Lord, Lord Hodgson, raised the concern that the definition of "major audit" was too vague and could operate as a catch-all. The purpose of the provisions is to ensure that arrangements for independent monitoring have a minimum scope of application. The arrangements must enable the performance of audit functions in respect of major audits to be monitored. Audits conducted in respect of listed companies are, by virtue of the fact of their listings, considered to be major. However, listings cannot be the sole criterion of whether an audit is major or not. There are likely to be companies which are not listed but whose importance is such that their audits must be considered as major audits. Obviously, each case has to be considered in its own context, but I believe that it would be wrong, for example, to exclude companies with large-scale operations just because they were not listed.
    Amendments Nos. 6 and 7 would restrict the disciplinary cases that have, as a minimum, to be subject to independent scrutiny under the independent arrangements. Amendment No. 6 would only cover those cases where it was clear at the outset of a disciplinary case that public interest issues were involved. However, it is not always clear at the outset of a disciplinary case whether or not public interest issues are involved. This will sometimes only become clear once an initial investigation has been carried out.
    The effect of the amendment could be that cases involving the public interest—which should be dealt with by the independent investigation and disciplinary arrangements—were instead dealt with by the recognised supervisory bodies themselves, on the grounds that it was not clear from the outset that public interest issues were involved. We do not believe that this is right.
    In response to Amendment No. 7, it may be useful if I explain to noble Lords what we expect would constitute "public interest cases". We expect that public interest disciplinary cases would cover cases about the conduct or quality of audit work in respect of listed companies and other major companies. These are the most likely to raise important issues affecting the public interest. For example, we would expect the type of case that is currently dealt with by the accountants' joint disciplinary scheme—which has investigated such cases as Polly Peck International and
    GC 30
    Queens Moat Houses—could be covered by the independent disciplinary arrangements. Of course, whether any particular audit of such a company was actually covered would be likely to depend on the seriousness of the issues raised by the case. The noble Lord, Lord Hodgson, asked about the right of appeal. There will be provision in the A IDB scheme for this right.
    We want those carrying out independent disciplinary arrangements to focus their attention and resources on the areas in which a failure of the audit process is likely to have the most important adverse impact on the economy, both directly and through damage to market confidence, rather than covering all audit irregularities.
    I agree that it is important that there is certainty as to the scope of the independent monitoring and disciplinary arrangements. It will be for the person exercising the recognition function—in the first place, the Secretary of State and then, if the functions are delegated as proposed in Clause 3, the Professional Oversight Board for Accountancy—to be satisfied that the arrangements are capable of applying to all audits falling within this category.
    [The Sitting was suspended for a Division in the House from 4.39 to 4.49 p.m.]
    Lord Evans of Temple Guiting: If the arrangements satisfy the requirements in paragraphs 19 and 20—I hope that noble Lords will remember what the arrangements were—the subsequent question of whether particular cases fall within the scope of the arrangements will be a matter for the arrangements to determine, having regard to all the circumstances.
    It is already a statutory requirement that recognised supervisory bodies must have effective arrangements for the monitoring of audits and the investigation of complaints against company auditors registered with them. We are introducing a requirement for monitoring, investigation and discipline to be carried out independently—this afternoon we have all stressed and welcomed the notion of "independently"—of the supervisory body in public interest cases. We believe that that is right. The public should have confidence that seriously weak or corrupt auditing will be regulated firmly enough to create real deterrence.
    I shall now answer a number of the questions raised by noble Lords. The noble Lord, Lord Hodgson, suggested that the definition of "public interest" was circular. In fact, the definition of "public interest cases" in paragraph 20 at line 19 of page 4 applies to public interest cases under the independent investigation arrangements. It does not apply to the term "major public interest" in paragraph 19 at line 38 on page 3 of the Bill.
    The noble Lord, Lord Freeman, said that he understood that a disciplinary case that did not raise important issues of public interest might still be subject to disciplinary investigation and sanctions. That is correct. Such a case would not be handled by the independent arrangements but would be considered by the supervisory body's own disciplinary arrangements.

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    On a point of detail, I should make clear that the FRRP will not carry out independent monitoring. Such monitoring is to be carried out by the Audit Inspection Unit, which will report to the Professional Oversight Board for Accountancy. The FRRP looks at accounts and not audits.
    Lord Sharman: Before the noble Lord sits down, in looking further at the matters raised by these amendments, which, as I read them, apply to companies and companies only, will he consider other entities which could be very clearly in the public interest but not qualify as companies? I have in mind large-scale partnerships, trusts and the like.
    Lord Evans of Temple Guiting: I am grateful to the noble Lord, Lord Sharman, for that question. The new legal requirement to sign up to independent monitoring applies only to companies because the Bill concerns companies and company auditors. However, the remit of the Financial Reporting Council Audit Inspection Unit, to which we expect the audit supervisory bodies to sign up, will in due course extend to the audits of large charities, major pension funds and other entities in whose financial condition there is a public interest.
    Therefore, although professional bodies will only have to sign up to independent inspection arrangements in respect of the audits of major companies, we anticipate that they will also agree to comply in respect of other major audits. I hope that that goes some way to reassuring the noble Lord, Lord Sharman.
    Lord Hodgson of Astley Abbotts: As I said when I began, this is a probing amendment and we accept the need for more listing of the criteria. The noble Lord, Lord Borrie, took issue with the words "appear to raise". I understand the force of his argument. The question is what constraints there are in those words and whether they can be used for fishing expeditions of one kind or another. Our purpose was to try to find a way to ensure some constraint on the Secretary of State's power or the bodies' power.
    I am grateful to the Minister for attempting to clarify some of the types of cases and I am grateful that there is an appeal procedure. My horse was slightly shot from under me because it never occurred to me that the concept of "public interest" at the bottom of page 3 was totally divorced from that of "public interest" half way down page 4 of the Bill. It seemed to me that, when used 10 lines apart, the words "public interest" might somehow be linked. But it was a very deft blow and my horse subsided beneath me. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 4 not moved.]
    Lord Hodgson of Astley Abbotts moved Amendment No. 5:
    Page 4, line 15, at end insert ", and
    (f) for ensuring that all defendants are properly represented"
    The noble Lord said: Amendment No. 5 focuses on the detail in new paragraph 20 in Clause 2—that is, the arrangements for independent investigation for disciplinary purposes of public interest cases. Here, it is proposed that disciplinary hearings as a result of independent investigations should be held in public by a person so designated by the supervisory body. That clearly brings an element of transparency, but we have a number of questions about the paragraph. How will the disciplinary hearings be conducted? Who will be the "designated person" whose role it is to adjudicate on the results of the investigation? And, if the hearings are to be held in public, might there not be some problems relating to confidentiality?
    In financial matters, issues of reputation and integrity are, quite rightly, paramount. When I was a member of the Securities and Futures Authority—one of the predecessor bodies of the Financial Services Authority—one concern was that disciplinary hearings held in public might have the effect of putting a person or firm out of business, even when found not guilty.
    Our amendment focuses on the legal requirements during the hearings. Obviously they will not be subject to the requirements of a judicial hearing under civil or criminal law, but will they, for example, be obliged to comply with the rights of the defendant in accordance with the ECHR—specifically Article 6—and the standards expected in a fair trial?
    It may be that a disciplinary hearing will expose the fact that a law has been broken or contravened. In such a scenario, the defendant could subsequently find himself in court. It would be very detrimental to fail to have, from the start, any clear structure which guaranteed the rights of the defendant in the initial disciplinary hearing in view of the fact that any further prosecution could use evidence from the conduct of the defendant in the disciplinary hearing—perhaps against him.
    We have no idea here of the structure of the hearing—that is, whether it will follow a standard format or whether the defendant will be allowed legal representation, and so on. We are concerned that the hearings may be ad hoc and unstructured. What right of appeal will there be against the disciplinary action? I can see no mention of that. I appreciate that it would not be a legal hearing but rather an internal disciplinary matter. However, I believe that there is some call to regulate the form of the disciplinary hearings and to clarify what rights the defendants will have.
    For most defendants, it will, it is hoped, be the first occasion on which they appear before a tribunal of this type. It will be new and unfamiliar territory for them and there are important reputational, as well as legal, issues to be addressed. The amendment is designed to ensure that every defendant will have access to experienced advice and to those who will be able to advise him widely, for example, on the implications of new paragraph 20(1)(c) of Part 3 at line 7 on page 4,

    GC 33
    which concerns the interests of justice and the implications for public hearings. We believe that that would be a useful safeguard. I beg to move.
    Lord Sainsbury of Turville: There are two issues here. One concerns the question of representation and the other the question of open disciplinary hearings. With regard to the first point, I believe it is right that defendants should have legal representation where appropriate. However, the aim of new paragraph 20(1) is to set out the minimum requirements for appropriate independent disciplinary arrangements. Those cover what we see as the most important elements of such arrangements: the functions of the arrangements, their transparency and their independence. The functions of the arrangements are set out as: the investigation of public interest audit cases; the holding of disciplinary hearings where it is considered desirable; and the taking of decisions as to whether—and, if so, what—disciplinary action should be taken.
    I consider that the extent to which the independent arrangements should ensure that all defendants are properly represented is a more detailed requirement which is best left to the arrangements themselves rather than being prescribed in legislation. In deciding whether particular disciplinary arrangements are "appropriate" for the purposes of new paragraph 20. the person exercising the recognition function will need to consider all aspects of the disciplinary arrangements.
    The issue of representation of defendants is one aspect of the function set out in new paragraph 20(1)(b) relating to the holding of disciplinary hearings. If the disciplinary arrangements did not make any provision in respect of representation, for example. that might be a matter which would call into question whether in fact the disciplinary arrangements would be an appropriate arrangement.
    Here we have an advantage because we already have the disciplinary scheme of the Accountancy Investigation and Discipline Board. That provides that a disciplinary tribunal may require the AIDB to meet the reasonable costs of a defendant's legal representation at a hearing if, taking into account all the circumstances, the absence of legal representation would be contrary to the rules of natural justice. The tribunal must conclude that it is not reasonable for a defendant to conduct his defence without legal representation—for example, because of the complexities of the issues involved—and that the defendant has established that he cannot afford and does not have adequate insurance cover for legal representation. So I believe that the point is covered through the disciplinary scheme of the Accountancy Investigation and Discipline Board.
    The second point relates to open disciplinary hearings. The requirement in the Bill for open hearings reflects an important principle of the strengthening of the regulatory regime. As the Government's review of the regulatory regime of the accountancy profession concluded, there is a need for greater transparency in terms of the clarity of the regulatory structures and the
    GC 34
    openness of decision making. The requirement for open hearings is consistent with the requirement of Article 6(1) of ECHR, that a person is entitled to a "fair and public hearing" in the determination of his or her "civil rights and obligations". I take on board the basic point of the amendment that there should be consideration that everyone is properly represented. I do not believe that such a provision needs to be put into the Bill as it has been taken account of already in the disciplinary scheme that I have mentioned.
    5 p.m.
    Lord Hodgson of Astley Abbotts: For a moment I thought that the Minister was accepting the logic of my argument and therefore the amendment. The AIDB will not be a statutory body; it will remain a self-regulatory body. It may have appropriate arrangements for carrying out the cases that meet the force of the amendment that we have tabled, but there is no statutory certainty that that will necessarily continue into the future. The way in which the Minister addressed the amendment means that he sees the force of it. I am unsure whether the AIDB example is a good reason to refuse it. However, we shall return to the matter when I have had a chance to read what the Minister said in more detail. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 6 and 7 not moved.]
    Lord Hodgson of Astley Abbotts moved Amendment No. 8:
    Page 4, line 30, after "no" insert "right to"
    The noble Lord said: We now come to supplementary arrangements to operate independently of body—not of "a body" or "the body", but of "body". During meetings with the Institute of Chartered Accountants in England and Wales this matter has also been brought to our attention. We are fully supportive of the concept of an independent body acting entirely independently. However, as presently drafted, this clause could be construed as precluding any form of consultation with the accountancy bodies on important matters.
    It is crucial that it be recognised that independence is not compromised by consultation. Indeed, the arrangements will have a much better prospect of operating successfully if the new bodies have the opportunity to avail themselves of the knowledge and experience of those who have previously been responsible for those important regulatory and disciplinary matters, and who still have regulatory responsibility as recognised supervisory bodies
    Although we recognise a purpose for the provision—which as the Minister has said is to satisfy other bodies in the United States and the European Union of the independence of UK regulatory arrangements—in its current form it does not reflect the intertwined powers and responsibilities that arise as a necessary consequence of the new UK regime which draws on existing statute, Royal Charters and bye-laws. As such, it risks making the complex regulatory and disciplinary framework unworkable.
    In particular, there is a danger that problems of enforceability against members and member firms of accountancy bodies will arise if paragraph 21(2) is misconstrued as enabling the new disciplinary body to impose on members of a supervisory body a disciplinary scheme that has not been approved through the constitutional arrangements under which the bodies operate; namely, a Royal Charter and bye-laws approved by the Privy Council. The AIDB draws its powers from those bodies that have agreed to participate. We entirely accept that the professional bodies that participate in the AIDB scheme should not have any involvement in the way in which the investigations and the holding of hearings are carried out.
    Turning now to our concerns about the detailed drafting of this part of the clause when applied to the Audit Inspection Unit (AIU), the AIU will need to work closely with the inspection and monitoring arm of the Quality Assurance Directorate, to which my noble friend Lord Freeman referred. While the AIU will have responsibility for major listed company audits, the RSBs will retain responsibility for the rest. That means that the AIU will inspect 50 or so audit firms, but the QAD will still have the remaining 6,000 plus firms to inspect and to monitor.
    The QAD also runs a desk-top monitoring service which considers annual returns from firms registered with the institute, press articles and input from elsewhere in the institute and from outside in order to run the risk-based monitoring system. That work will be made available to the AIU for the firms that it is involved in monitoring so that it can draw up its own risk-based inspection programme.
    As the QAD is responsible for the non-listed company audits, there may be some instances in which both inspectorates will need to co-ordinate their visits to firms to ensure efficiency on site. After a visit, the two inspectorates will present reports together to the audit registration committees of the relevant chartered institutes.
    That level of co-operation is essential for the smooth running of the new system. If the present drafting of paragraph 21(2)(b) is interpreted as prohibiting such co-operation, that would be most unhelpful and interfere with the effectiveness of the inspection regime. The amendment that we propose would provide a solution to that problem. It runs along the comments made by several noble Lords, including my noble friend Lord Freeman, that relate to the need for smooth co-operation in the future and for people not to get on their high horses. I beg to move.
    Lord Sharman: My name is attached to this amendment. I totally support the arguments made by the noble Lord, Lord Hodgson. I shall not delay the Committee longer by repeating them. Suffice it to say that I believe there are five key points that we need to ensure are put in place in the working of this regime. First, there must be no preclusion of consultation with the accountancy bodies. That simply will not work. Secondly, it must be recognised that independence is
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    not compromised by consultation. Thirdly, we must ensure that whatever results is enforceable. We cannot allow ourselves to get away from that. Fourthly, we entirely accept that professional bodies should not have any involvement in the way in which the investigations are carried out. Fifthly, to reinforce the words of the noble Lord, Lord Hodgson, anything that precludes the AIU and the QAD working closely together and effectively will be a poor result in terms of the effectiveness of the Bill.
    Lord Borrie: The noble Lord, Lord Sharman, has said that he agrees with the government arrangements that there should be no interference by other professional bodies in the way in which the proceedings are carried forward. There must be no involvement. Inserting "no right to" before the word "involvement" suggests to me that while there is no right, none the less one could have or could be allowed to have an involvement. That would appear to apply also to the appointment of members which would be most unfortunate.
    Lord Evans of Temple Guiting: Perhaps I can repeat a point made by my noble friend Lord Sainsbury at the beginning of these proceedings; that we want consultation, that we believe in consultation and that we believe that consultation is of tremendous importance. Now that we have both made that statement I hope that it will reassure professional accountancy bodies.
    I emphasise that the aim of this provision is not to prevent the recognised supervisory bodies from having any input at all into the work that will be carried out by the independent standards setting, monitoring and disciplinary arrangements, where that is appropriate. The recognised supervisory bodies, for example, will be able to comment on draft auditing standards prepared by the independent standards setter. However, they would not be able to take part in the decision making of what should constitute the final standard to be issued.
    I believe that this amendment carries the potential to weaken significantly the requirement for independence. One can envisage a future situation in which a supervisory body chose to participate in standard setting, monitoring or disciplinary arrangements under which, by informal practice with the body running the arrangement, the supervisory body was closely involved with the core business and decision making in those areas. As long as that was by informal practice and the supervisory body had no right to such involvement, we consider that, if the amendment were accepted, the person exercising the recognition function could regard the arrangements as satisfying the independence requirements. I do not consider that that would be desirable.
    The aim of new paragraph 21 is as set out in the heading; namely, to ensure that the arrangements "operate independently" of the supervisory bodies. There are two general ways that supervisory bodies can be involved in the arrangements. The first is that they are involved in the choice of who carries out the

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    functions. That is prevented by paragraph 21(2)(a). The second is that they are actually involved in the operation of the functions. That is prevented by paragraph 21(2)(b). We believe that it is necessary to prevent both kinds of involvement in order to ensure real independence of regulation.
    Paragraph 21(2)(a) and (b) apply only for the purposes set out in paragraph 21(1); that is, for ensuring that the following activities are done independently of the supervisory bodies: the determination of technical audit standards and audit standards relating to professional integrity and independence; the carrying out of monitoring and inspections in respect of major audits; and the carrying out of disciplinary investigations, hearings of disciplinary cases and the taking of disciplinary decisions.
    The noble Lord, Lord Hodgson, raised whether the RSBs' monitoring arrangements would be prevented from working with the independent monitoring arrangements. We are keen that the recognised supervisory bodies' monitoring arrangements in respect of non-major audits should work closely together with the new independent monitoring arrangements for major audits, both to share experience and to ensure that monitoring regimes operate seamlessly. The provisions would not prevent the bodies' monitoring arrangements providing information on the audit firms to be visited, nor would it prevent the co-ordination of on-site inspection of firms. We believe that it is important that we have a balance between allowing a sensible operational interface between the arrangements while at the same time ensuring that the new monitoring arrangements are carried out independently.
    The noble Lord, Lord Hodgson, also asked whether that would stop the RSBs from agreeing to rules of the AIDB scheme and any changes to those rules. As far as the AIDB is concerned, new paragraph 21(2)(b) means that recognised supervisory bodies may not have any involvement in the way in which the scheme operates in general. That would include matters such as the carrying out of investigations and the holding of hearings.
    However, it will be the responsibility of each recognised supervisory body to satisfy itself that the arrangements in which it proposes to participate in order to meet the new recognition requirement introduced by Clause 1(5) of the Bill actually meet the criteria set out at new paragraph 20(1). So the decision on whether to sign up to the AIDB scheme, and to delegate to it the disciplinary powers that the AIDB needs so that the AIDB tribunals can impose sanctions directly on the body's members as required at paragraph 12A(1)(b), rests with each body. Similarly, if the rules of the scheme change, it is the responsibility of the body to satisfy itself that the new rules still enable the scheme to meet the criteria in new paragraph 20(1) and the decision on whether to continue to participate in the scheme under the new rules rests with the body.
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    The provision at new paragraph 21(2)(b) is intended to assure the operational independence of the investigation and disciplinary arrangements. It is not intended to affect those decisions that the supervisory bodies must take and we do not think that it could be interpreted as having such an effect.
    5.15 p.m.
    Lord Hodgson of Astley Abbotts: That is a very thorough and complex answer which will require careful study. The phrase in new paragraph 21 is that,
    "the body has no involvement in".
    The words "no involvement in" can be interpreted as "cannot have an involvement in" or "must not have an involvement in". That cuts across the issue that we were trying to raise about it being permissive as opposed to exclusive. We felt that it was drafted exclusively and therefore cut across an issue that the noble Lord, Lord Sainsbury, raised earlier, when he said he wanted to encourage co-operation going forward. By saying "no right to" we were trying to make it clear that the body had no right to involvement but could be involved. I believe on this issue we should read what the Minister has said.
    Lord Freeman: Before my noble friend withdraws his amendment, perhaps he would agree that further thought is genuinely required on this point. It may appear to the Government to be a minor point, but it is symbolic of the issues to which my noble friend Lord Hodgson and the noble Lord, Lord Sharman, referred earlier. I would be grateful to my noble friend Lord Hodgson, in considering how to proceed, if he considered the two issues about which there is surely no dispute in the profession: that there should be no involvement in decision making or implementation of decisions. There was no discussion about those two matters. Surely, as my noble friend Lord Hodgson said, to rule consultation out implicitly seems to be throwing the baby out with the bath water.
    Lord Hodgson of Astley Abbotts: I am grateful to my noble friend. He has put the matter very elegantly. I shall withdraw the amendment at this stage, but I hope that the Minister will give it further thought to ensure that we do not cut across the matter. There is no disagreement about the need for collaboration, but that we are not doing it inadvertently. A view outside the Committee is that there is a danger that we certainly may be doing that.
    Lord Evans of Temple Guiting: Perhaps I may return to another point that my noble friend Lord Sainsbury made earlier, that we shall consider anything that is said this afternoon. The noble Lord, Lord Freeman, has made a very interesting point that we would like to consider and return to later.
    Lord Hodgson of Astley Abbotts: I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 9:
    Page 4, line 32, leave out second "or"
    The noble Lord said: On page 4 we drop down a couple of lines for the next two amendments. They take us to new paragraph 21(2)(a) and (b) to which the Minister referred in answering the previous group of amendments. This amendment focuses on the supplementary paragraph defining "independence" for the purposes of new paragraphs 17(b), 18(b), 19(1)(6) and 20(1)(e).
    Amendment No. 9 asks the Government to explain what is covered by subparagraph (b). The Minister touched on this matter when replying to the previous group of amendments, but I believe that it is worth addressing the matter on its own. What does the phrase "other respects" in line 33 cover in regard to independent monitoring? It would be helpful if the Minister put on the record some examples of where the arrangements of a recognised supervisory body would or would not comply with sub-paragraph (b).
    This seems, as currently drafted, a pretty broad and open-ended provision. It would be better, however, if we could have some idea of the interferences envisaged that would make it necessary. Unless the Minister can give us some examples of the difficulties that the provision seeks to address, it seems an unnecessary addition to the Bill and another potential barnacle to avoid.
    Amendment No. 10 is designed to probe the drafting. Arrangements are not to be regarded as independent unless they are designed to ensure that the body has no involvement in,
    "(a) the appointment or selection of any of the persons who are to be responsible for doing the thing or things in question, or
    (b) the way in which the arrangements operate in other respects".
    If the Minister can justify the inclusion of paragraph (b), surely both options should be covered. We do not see that the two sub-paragraphs are mutually exclusive. In order to meet the required standards of "independence", the recognised supervisory body should be removed from both the appointment and selection process and—not or—any other arrangements.
    I look to hearing how the Minister intends these independent arrangements to work. We want to ensure that the legislation is as clear as possible, given the general background, for those bodies which have to work with and abide by it. We want the provisions to be workable, practical and unambiguous, and I am not sure whether paragraph 21 achieves that aim. I beg to move.
    Lord Borrie: I am surprised by the noble Lord's interpretation. Why does it not mean either (a) or (b)?
    Lord Hodgson of Astley Abbotts: Quite simply, we thought it should be both. It should cover both cases—
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    it should not be a question of "or". If these arrangements are operating independently, it should cover both of them.
    Lord Borrie: It will.
    Lord Evans of Temple Guiting: The aim of Clause 2 is to ensure that the standard setting, monitoring and disciplinary arrangements are independent of the recognised supervisory bodies. Making the regulation of auditors more independent is the primary purpose of Clauses 1 and 2, and paragraph 21(2) is central to this.
    We have defined "independence" in new paragraph 21(2) in terms of preventing the "involvement" of the recognised supervisory bodies. I should say again that this will be a matter for the person exercising the recognition function to decide, in the light of all the facts, whether or not a recognised supervisory body is actually "involved" in any of the arrangements. It may be helpful if I say a few words about what I mean by this.
    In the previous amendment, I gave assurances on co-operation and discussion, although I said that the bodies in question would not be able to take part in decision-making on what should constitute the final standard to be issued. Although it is not entirely analogous, it might be helpful if I offer a parallel example.
    When taking a car to the garage for its annual MOT, if it is three years' old, a customer would expect to be able to have an input and influence the service received—for example, when the car will be ready for collection and whether any other additional services should be performed at the same time. But customers are not involved in carrying out the actual work, nor are they involved in the final decision on whether the car is roadworthy. That is the sort of distinction we are aiming to draw with these provisions.
    As I mentioned before, it will be for the person exercising the recognition function—the Secretary of State or, if the functions are delegated under Clause 3, the Professional Oversight Board for Accountancy—to decide whether the way in which the independent arrangements operate in practice is such that in fact they operate independently within the terms of this provision.
    The noble Lord, Lord Hodgson, asked what new paragraph 21(2)(b) on page 4, line 33, actually meant. The aim of new paragraph 21 is as set out in the heading; namely, to ensure that the arrangements "operate independently" of the supervisory bodies. There are two general ways in which supervisory bodies can be involved in the arrangements. The first is that they are involved in the choice of who carries out the functions, which is prevented by paragraph 21(2)(a). The second is that they are actually involved in the operation of the functions, which is prevented by paragraph 21(2)(b). We believe that it is necessary to prevent both kinds of involvement—therefore, (a) and (b)—in order to ensure real independence of regulation.

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    ensuring that failure by a recognised supervisory body to pay the appropriate costs is, in itself, a breach of the recognition requirements. The requirement could be enforced by the person exercising the recognition function seeking a compliance order from the court and, ultimately, by revoking recognition. This is an important provision that removes any possible perception of a risk that a supervisory body could seek to wield undue influence over the arrangements by withholding payment or threatening to do so. I believe that the proposed amendment would weaken the provision unacceptably.
    It is not the case, however, that the recognised supervisory bodies would automatically have to bear 100 per cent of the costs of the standard setting, monitoring and disciplinary arrangements. That is not what new paragraph 22(1) provides. The key phrase in this provision is,
    "in the event of their providing for the … costs of maintaining the arrangements".
    We anticipate that the recognised supervisory bodies will comply with the requirements in Clause 1 by following the standard setting, monitoring and disciplinary arrangements set up under the new FRC; that is, the Auditing Practices Board, the new Audit Inspection Unit of the Professional Oversight Board for Accountancy and the Accountancy Investigation and Discipline Board. Noble Lords may find it useful if I set out the arrangements for the costs of maintaining those bodies.
    The generality of the FRC's costs will continue to be met through the existing tripartite funding regime, under which government, business and the accountancy profession each hear one-third of the costs. The standard setting arrangements of the Auditing Practices Board provide for funding to be met through the tripartite regime. The funding arrangements are, however, different in respect of monitoring (the new Audit Inspection Unit) and discipline (the Accountancy Investigation and Discipline Board). For both functions, the core running costs are funded on the tripartite basis I have just outlined.
    However, all the case costs of the monitoring function and the disciplinary function will fall to be paid by the accountancy profession. This is what the arrangements provide for and, under new paragraph 22(1), it is therefore what the recognised supervisory bodies would be obliged to pay in order to meet the recognition requirement of participation in an appropriate funded arrangement.
    We are strongly committed to the principle of the tripartite funding arrangement under which government, business and the profession each bear one-third of the core costs of the FRC. We have made our commitment plain in the Review of the Regulatory Regime of the Accountancy Profession and in the Statement I made to the House on 29 January last year. I reaffirm the commitment that we made then. The reason we have put Clause 16 into the Bill is to enable government to fulfil their part of this commitment. The levy point of course only comes in in
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    a situation where this arrangement essentially breaks down. But as we see the matter, this is the commitment we are making.
    5.45 p.m.
    Lord Hodgson of Astley Abbotts: I am grateful to the Minister. We have heard enough about his commitment to the tripartite arrangement continuing, about core costs and the FRC being funded in that way. I am happy to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 2 agreed to.
    Clause 3 [Delegation of functions by Secretary of State to new or existing body]:
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 12:
    Page 5, line 26, at end insert—
    "( ) Schedule 13 to the Companies Act 1989 (c. 40) (supplementary provisions with respect to delegation order) is amended as follows.
    ( ) For paragraph 3(2) and (3) substitute—
    "(2) The body shall consist of such persons as the Secretary of State may appoint after such consultation as he thinks appropriate, provided that—

    (a) not less than eight people are appointed;

    (b) a minimum of three are individuals who hold a qualification from one of the bodies recognised by the Secretary of State as offering a recognised professional qualification;

    (c) a majority of those appointed are non-executive members;

    (d) the appointments for office are for a period of three years and for two further three year periods if subsequently reappointed; and

    (e) the chairman of the body shall be such person as the Secretary of State may appoint from amongst its members.

    (3) The Secretary of State must secure that a committee of the body, consisting solely of the non-executive members, is set up and maintained for the purposes of discharging the functions set out in subsection (4).
    (4) The functions of the non-executive committee are to issue rules for the identification and disclosure of conflicts of interest in a form which is satisfactory to the Secretary of State.""
    The noble Lord said: Clause 3 deals with the delegation of functions by the Secretary of State to a new or existing body. In moving Amendment No. 12, I shall speak also to Amendment No. 18. The amendments focus on the changes made by Clauses 3 to 5 to Section 46 and Schedule 3 to the 1989 Act. I shall put forward our general comments in a minute when I speak to the Question of whether Clause 3 stands part.
    I refer now to Amendment No. 12 which seeks to substitute for paragraphs 3(2) and (3) in Schedule 12 a more detailed set of provisions for the constitution of the delegated body under Section 46. Amendment No. 18 is merely a consequential amendment that makes the necessary changes to Clause 5.
    In the Companies Act 1989 there is a power for the Secretary of State to establish a body corporate to exercise powers in relation to company auditors and the recognition of supervisory bodies. Schedule 13,
    Paragraph 21(2)(a) and (b) apply only for the purposes set out in paragraph 21(1)—that is, for ensuring that the following activities are done independently of the supervisory bodies: the determination of technical audit standards and audit standards relating to professional integrity and independence; the carrying out of monitoring and inspections in respect of major audits; and the carrying out of disciplinary investigations, hearing of disciplinary cases and the taking of disciplinary decisions.
    Perhaps I can quickly raise an issue that has not been raised but that, given that we are trying to reassure the profession and accountancy bodies, may be helpful. That is the question of whether this will prevent the accountancy bodies providing secondees to the FRC. The answer is "no". We see benefit in some degree of interchange, for example between the staff of the new inspection unit and the very experienced staff who have been carrying out inspections under existing arrangements. But it is important that it should be the people operating the arrangements, and not the accountancy bodies, who decide whether a secondee should be used and select that secondee, and that the body should not be involved in the decision. That is achieved by paragraph 21(2)(a). The aim of new paragraph 21(2)(b) is to preclude arrangements where the bodies had any part in the functioning of the arrangements. It would not preclude arrangements to which bodies had seconded staff, for example. The mere presence of seconded staff would not in itself deprive the arrangements of their independence, because it would not necessarily mean that the bodies had any part in the functioning of the arrangements.
    Lord Hodgson of Astley Abbotts: I think that I have grasped what he is getting at, and grasped the significance of it. I hope that he will not think me unduly cheeky but, when he said how important it was that both (a) and (b) applied, he did not say (a) or (b). However, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 10 not moved.]
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 11:
    Page 4, line 41, after first "of" insert "a fair proportion of the"
    The noble Lord said: We come to the next part of page 4, which is on supplementary funded arrangements, focusing on the funding for the new arrangements set out in paragraphs 17 to 20, in which the supervisory bodies are now required to participate. We have had representations from members of the profession on the issue; they have commented that they are entirely willing to participate in the new arrangements and contribute to the funding but believe that there should be some measure to allow them to bear an appropriate proportion of the cost rather than, as the drafting currently suggests, that they could end up paying all of it.
    Paragraph 22(1) implies that the supervisory bodies will pay 100 per cent of the costs of standard setting relating to integrity, independence and technical
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    standards; independent monitoring of audits of listed companies; and independent investigation for disciplinary purposes of public interest cases. Paragraph 22(2) extends the supervisory bodies' funding responsibilities so that they are not confined to the activities for which they are a supervisory body.
    I believe that I have got it right in saying that the agreement with the Government currently is for the basic cost to be funded in three equal parts by the Government, business and the profession as a whole, not just by recognised supervisory bodies, through the Consultative Committee of Accountancy Bodies. Those tripartite arrangements should be reflected in the new arrangements proposed in the Bill, or at least the Minister should give an undertaking on the record today. Therefore we wish to insert the words,
    "a fair proportion of the",
    to give effect to that. I beg to move.
    Lord Sharman: My name is attached to the amendment. I support what the noble Lord, Lord Hodgson, has said. I remind the Minister of what I said at Second Reading.
    [The Sitting was suspended for a Division in the House from 5.29 to 5.39 p.m.]
    Lord Sharman: I think I had reached my Second Reading remarks. As I said at Second Reading, it has always been my understanding that the basis on which these arrangements would go forward would be what I would call the third formula. I believe that it is very important that the formula is reconfirmed so that we do not find one body with an interest in this bearing all the costs.
    Lord Borrie: I express the hope that the Minister in giving his reply will make reference to paragraph 19 of the Explanatory Notes. It is probably my fault, but I cannot find the provisions referred to in the first sentence—that,
    "provisions would … enable the Secretary of State to impose a levy on bodies or persons".
    I thought and hoped that "on … persons" means—I do not suppose that the noble Lord, Lord Sharman, would agree with me—individual members of the professions as distinct from the professional bodies. I say that partly because of a comment I made during my early remarks this afternoon, that when I was chairman of the Accountancy Foundation we had tremendous difficulty getting adequate funds out of the professional bodies. They gave all sorts of reasons for the difficulties. It occurred to me—but of course it would be possible only under a statutory scheme—that a levy on individual members of the professions might be a way of helping. Perhaps I have missed or lost something because I cannot find whether the Secretary of State has such a power under the Bill.
    Lord Sainsbury of Turville: I can give the assurance that noble Lords are looking for as to how we intend to take the issue forward. The purpose of new paragraph 22(1) is to assure the independence of the standard setting, monitoring and disciplinary arrangements by

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    which sets out supplementary provisions relating to the delegation of these functions, has little in the way of detail. The powers which it will take on are of considerable importance, particularly given the changes envisaged with the alterations brought forward by the Bill and with the reorganisation of the FRC and its subsidiary bodies.
    We understand from the Explanatory Notes that the body which will be granted delegated powers under Clauses 1 to 5 is likely to be POBA—the Professional Oversight Board for Accountancy. That is, as I understand it, a new body which takes on some of the old responsibility of the review board and is designed to provide a statutory oversight of self-regulation for the accountancy profession.
    Our amendment seeks to probe the set up of this new body. Paragraph 3 of Schedule 13 to the Companies Act 1989 currently gives scarce detail, save the requirement that the body must have a minimum of eight members. We believe that this meagre outline should be enlarged upon and not left to the whim of the Secretary of State, whoever he or she may be in the future. It is old drafting and not in line with modern practice. There is, in primary legislation, ample precedent for having a fuller specification for the constitution of a new regulatory body, including provision for non-executive members and a non-executive sub-committee. We have borrowed a considerable amount of our wording from Schedule 1 to the Financial Services and Markets Act 2000. This schedule details the workings of the Financial Services Authority as established by that Act.
    I shall briefly run through what we believe to be the key requirements for POBA or whatever other body might be delegated, having fulfilled the delegation requirements. We have retained the two requirements already present in the existing legislation in paragraphs 2(2) and 2(3)—that is, that the Secretary of State may appoint such persons as he thinks fit after such consultation as he thinks appropriate and that he must appoint at least eight persons.
    We have, however, gone further in providing detailed provisions for the body. First, we state that a minimum of three should be individuals who hold a qualification from one of the bodies recognised by the Secretary of State as offering a recognised professional qualification. We think that this is an important safeguard. Since this body is intended to regulate the auditing and accountancy profession, we need to be sure that there are at least three qualified accountants serving on the body. They will have the personal knowledge and professional experience of the auditing business. Our requirement for three is merely a probing figure—we thought it important that there should be some statutory requirement for a certain number of qualified members on the body.
    Paragraph (2)(c) of our amendment states that a majority of those appointed should be non-executive. With this provision, we have borrowed from the drafting of Schedule 1 to the Financial Services and Markets Act where special provisions are laid out in paragraph 3 for non-executive members of the
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    governing body. If the FSA is to have a majority of non-executives, the same principle should hold good for this regulatory body. FSMA requires the non-executive members of the FSA board to form a committee for specific purposes, and again we have borrowed this wording for an identical provision in the Bill.
    In the case of the non-executive committee, which we propose, its functions would be to issue rules for the identification and disclosure of conflicts of interest in a form which is satisfactory to the Secretary of State. Conflicts of interest are a sensitive area in any business environment. When dealing with self-regulation and the monitoring of standards and good practice they are, of course, particularly significant. We would make it the duty of the non-executive committee of the body to set out clear rules on conflicts of interest for the benefit of the recognised supervisory bodies and under the eye of the Secretary of State. The Minister may tell us that this will already be within the remit of the delegated body—POBA However, we think that conflicts of interest are of particular importance and warrant inclusion in the schedule to the 1989 Act; and our amendment would fulfil that aim.
    Our last two paragraphs set out the terms of appointment for members of the regulatory body. Appointments should be on the basis of a three-year term, with, if re-appointed, a further two years. We are conscious here of the recommendation in the second Nolan committee report which stated that terms of office, which should be renewable, should not normally exceed four years and reappointment for third or subsequent terms should be the exception rather than the rule. Our amendment is in line with that principle: we stipulate a three-year term with two further three-year terms if reappointed.
    Finally, our amendment would give the Secretary of State the power to appoint the chairman from among the members of the body.
    The amendment is designed to elicit some details of the structure of the body which will receive delegated powers under these clauses. The Minister may not wish to have such details on the face of the Bill, but we think it advisable in light of the precedent of the FSA in the Financial Services and Markets Act. He will, however, be able to put on record how he believes the body will be structured and if it will differ from the structure we have proposed. I look forward in particular to hearing how the body will be composed, especially in relation to non-executives, who are an essential buttress to independence. I beg to move.
    Lord Sainsbury of Turville: I am afraid that the amendment would shoot a hole in the carefully constructed basis of the whole arrangement, which is that the Secretary of State will delegate her functions to the Professional Oversight Board for Accountancy. That is part of the agreed way forward on the whole issue. If the amendment were passed, she would not be able to do that. Let me explain why that is and therefore why we think the amendment should not be pressed.

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    The basic policy aim behind Clauses 3 to 5 of the Bill is to implement the recommendation of the review of the regulatory regime of the accountancy profession that the Secretary of State's role in recognising supervisory bodies and qualifications should be delegated to an independent body, namely the successor of the review board.
    As the review acknowledged, the current delegation power in Section 46 of the Companies Act 1989 does not enable us to achieve this policy aim as it only permits delegation to a body created by the delegation order, not to an existing body. In the case of the Professional Oversight Board for Accountancy, we already have this body in existence. It is understandable that that was the case in the Companies Act 1989 because when that Act was drawn up there was no existing body to which the Secretary of State's functions could have been delegated.
    Although the Financial Reporting Council existed at that time, it did not have any remit in respect of audit regulation. That is hardly surprising, since audit was largely a self-regulated profession until the 1989 Act came into force.
    Clauses 3 to 5 therefore make technical changes to the 1989 Act to enable decisions on the recognition of supervisory bodies and audit qualifications to be taken by an existing body. However, different considerations apply when delegating statutory functions to an already existing body as opposed to setting up a body from scratch to delegate functions to. When setting up a body from scratch, of course you need to make provision for things like members, chairman, proceedings and so on. However, when faced with an existing body, the question is whether this body will exercise the functions effectively. If the answer is no, then the functions should not be delegated.
    New Section 46A(3)(a) of the Companies Act 1989 provides that the Secretary of State may delegate her functions to an existing body only if it appears to her that the functions will be exercised effectively. Clearly, if the Secretary of State had doubts for example about the suitability of the chairman or members of the body, she would not make the delegation order. It is not necessary to require her to appoint them.
    I consider that these amendments would hinder our policy aim, which is for the Secretary of State's function to be delegated to the Professional Oversight Board for Accountancy, provided it meets the requirements for delegation to be made to it. This would impede the realisation of synergies that would significantly improve the overall independence of the regime and the effectiveness of oversight of the supervisory bodies. I give the Committee two examples. The Professional Oversight Board for Accountancy does not comply with the criteria in the amendment. None of the members is appointed by the Secretary of State, and there is no committee with a remit set out in subsection (4) of the amendment.
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    I point out finally that any delegation order is subject to affirmative resolution because we believe it is right that the House should have an opportunity to debate the precise nature of the functions to be transferred and the identity of a body to which they are to be transferred. So, there will be an opportunity to consider this. It is an essential feature of the scheme we put forward that delegation would be made to the Professional Oversight Board for Accountancy. That could not take place if the amendment was passed. That is probably not the noble Lord's intention in this particular case.
    Lord Hodgson of Astley Abbotts: It is not. As I understand it, the Minister says that the Secretary of State has a failsafe power because she does not delegate if she does not like the way the thing is organised. That is potentially difficult. Presumably the structure of the board to which delegation has taken place could subsequently alter after delegation has taken place. Delegation would be withdrawn in order to force the board to behave in the way that the Secretary of State felt would permit it to carry out its functions effectively.
    I find that a strange way to do things. It would be better to say, "This is how we want it done, in order for us to be able to make a delegation order effective", rather than to say, "We'll see what you have got to do and if we don't like what you are going to do, we will either not delegate you in the first place or remove your delegation order". That seems a clumsy way of doing things. Given the confusion in the drafting of the Bill, it may be that that is the only way it can be done. But it puts the Secretary of State, whoever he or she may be, into quite a difficult position of having to withdraw a delegation. That will cause quite a bit of difficulty if the delegated body were to be obstinate in the way it has organised itself.
    I accept what the Minister said about the affirmative statutory instrument, so that the House has a chance to look at what has been done before it happens. I wonder whether we have a rather clumsy approach, but maybe that is imposed on us by the way that the legislation is currently drafted. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    6 p.m.
    On Question, Whether Clause 3 shall stand part of the Bill?
    Lord Hodgson of Astley Abbotts: I rise to speak to Clause 3 on a probing basis again to have a similar discussion to that on Clause 1. We have some complicated amendments, substitutions and additions to the 1989 Act. Perhaps I could briefly set out for the Minister what I think the situation is to see whether I have correctly understood the point of Clauses 3 to 5, which hang together. These clauses are inextricably intertwined so I hope the Minister will forgive me if I stray slightly beyond the provisions of Clause 3.

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    The Explanatory Notes tell us that the point of Clauses 3 to 5 is to extend the provisions already set out in Section 46 and Schedule 13 to the Bill, which deal with establishing a body to carry out functions delegated by the Secretary of State to do with the regulation of auditors. Section 46 allows the Secretary of State only to delegate the body named in the delegation order.
    It appears that these provisions are not sufficiently widely drawn for the new proposals which the Government envisage. The notes tell us that the Government want to designate POBA—the Professional Oversight Board of Accountancy—a new body set up under the FRC, as the body whose function will be the supervision of the auditing profession. It will therefore, presumably, take on the role of the Secretary of State in regard to certain functions relating to company auditors and the recognising of bodies which supervise auditors and/or pro vide professional qualifications. Since Section 46 allows only the body named in that delegation order to exercise these functions, Section 46 must be amended to allow POBA to do so instead.
    I realise that POBA will be a body under the FRC's new structure, but I have some questions for the Minister. First, which body has currently been designated under Section 46 of the 1989 Act? How will the transitional period work whereby the delegated functions are handed over from one to the other? Will the current body which carries out these delegated functions merely be subsumed into POBA?
    I am also unclear about Clause 4, which refers to the Secretary of State delegating functions to an existing body—so not just one established by an order under Section 46. My question is to do with timing. As I understand it, although the Minister said something else in the previous debate, POBA is not yet an existing body. It is a new body to be created under the FRC. It does not yet exist. Yet it is clear from the Explanatory Notes that the changes being made in Clauses 3 to 5 are designed to ensure that designation can be to another body which is expected to be POBA. Under Clause 3(2)(1A) are the two options of, in paragraph (a), the body which was designated in the order under Section 46 and currently carries out those functions or, in paragraph (b), subject to Section 46A, an existing body which the Explanatory Notes tell us is likely to be POBA. My confusion is that I am not yet aware whether POBA is an existing body.
    I imagine that the Minister will tell me that POBA will exist by the time these clauses of the Bill are brought into commencement. If that is the case, could the Minister tell us whether there are any other functions POBA will carry out apart from the delegated functions proposed here? Further, can the Minister shed some light on the basis of the change from old to new structure in terms of regulation of the audit and accountancy profession? Why is POBA more suitable than the current body which carries out these regulatory functions, other than the independence issue that we have already discussed? What has prompted the need for restructuring other than a bit of tinkering with appearances?
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    We have had some briefing on the change to the new structure from our discussions with the ICAEW, which has emphasised to us some concerns with the three specific roles which it understands that POBA will undertake. I seek some clarification about the operation of POBA. The board will have three discrete functions: first, delegated responsibility for carrying out the Secretary of State's function of recognising supervisory bodies for audit; secondly, oversight of the accountancy profession; and, thirdly, responsibility for the operation of the new Audit Inspection Unit. To return to an issue that we have mentioned already, it is important that all three functions are exercised in concert with, rather than in opposition to, the existing regulators in the field.
    We have five chartered institutes: the Institute of Chartered Accountants in England and Wales; the Institute of Chartered Accountants of Scotland; the Institute of Chartered Accountants in Ireland, who cover Northern Ireland; the Chartered Institute of Public Finance and Accountancy; and the Chartered Institute of Management Accountants. There is also the Association of Chartered Certified Accountants. Those organisations have worked both singly and together over many years to create the high level of regulatory and disciplinary assurance which is now apparent in this country. We believe that if must be in the interests of the UK as a whole to ensure that the new regulatory arrangements under the FRC work closely with the existing chartered institutes to create a seamless structure of regulation in partnership. In view of the concerns that have been expressed to us by those outside bodies, it would be worth while if the Minister could give us assurances that he shares that view of the inter-relatedness of these regulatory arrangements, and the importance of ensuring that we do not inadvertently undermine our existing chartered institutes as we bring the new FRC arrangements into place.
    I turn now to the detail of the operations of the POBA. We believe it important to note the distinctions between the three operations for which it is responsible. In relation to its regulatory functions, it has the delegated responsibility from the Secretary of State for recognising supervisory bodies. Those bodies will then report to it, as they currently do to the DTI, annually to show how they have discharged their responsibilities for registration and supervision of auditors which are derived from statute, and it will be for POBA to decide whether they should continue to be suitable for recognition. The arrangements for registration, monitoring and inspection will derive from the Secretary of State's responsibilities and powers, and POBA will do no more in that area than exercise those powers on her behalf.
    The function of POBA in that regard is surely rather different from its second function, which is for oversight of the accountancy profession. Here we would expect POBA to take a wider look at how the profession as a whole is progressing. That function must be operated at a broad level, and can be exercised only with the agreement of the existing chartered institutes, which are responsible for the development

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    and discipline of their members. While those institutes should welcome any input into the broad debate on how the profession can be developed—and indeed themselves voluntarily set up POBA's predecessor, the Review Board, precisely to get that broader view—to get the best out of the new system they surely should not be junior players in this partnership. They must remain free to accept, modify, and take forward in their own way for their members any recommendations made by POBA. I am sure that POBA will want to progress in a way which fully acknowledges the level of professional expertise and the depth of experience which the chartered institutes represent.
    On the third and final function—inspection and monitoring—my main point is that the new Audit and Inspection Unit, or AIU, which is the only executive function of POBA, needs to continue to work closely with the Quality Assurance Directorate, or QAD, of the Institute of Chartered Accountants in England and Wales, whose member firms deal with the vast majority of company audits. Here again, I emphasise the point made earlier by my noble friend Lord Freeman. While the AIU will in due course cover the top 50 or so audit firms, the QAD will have a very important continuing function in inspecting and monitoring the remaining 6,000 plus registered firms, many of them of significant size, and auditing companies which, although outside the AIU remit, are still substantial high- value companies. Again, our key point here is that the new arrangements must not undermine the strength of the arrangements which have developed over the last decade, and that we must present all our regulatory processes in an inter-linked way to those who are considering and assessing them from abroad. I should be grateful for the Minister's confirmation that he shares that view of the way in which the Professional Oversight Board for Accountancy will operate.
    Lord Sainsbury of Turville: I have two points of fact that are necessary for this discussion. First, POBA exists—at least, I am assured that it exists and have no reason to think otherwise. That is quite material to this discussion. Secondly, the powers that were in Section 46 of the Companies Act 1989 have never been delegated because of the complexities of that. That must be the starting point for this discussion.
    Clause 3 enables the Secretary of State to delegate to a new or existing body her functions under Part 2 of the Companies Act 1989—that is, powers relating to the regulation of the audit. At present, Section 46 of the Companies Act 1989 enables the Secretary of State to delegate her functions under Part 2 of the Act. However, the functions can be delegated only to a body created, through the delegation order, for the purpose of exercising those functions. Clause 3 changes this, so that the functions may be delegated to an existing body.
    The functions in question are primarily those of recognising supervisory bodies and qualifications for auditors. The Government's Review of the Regulatory
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    Regime of the Accountancy Profession recommended that the Secretary of State should delegate those functions to the body responsible for independent oversight of the self-regulatory activities of the major professional bodies. The review concluded that that would result in more effective oversight of the bodies.
    We envisage that the functions will be delegated to the Professional Oversight Board for Accountancy, or POBA, of the Financial Reporting Council. POBA is the successor to the Review Board of the old Accountancy Foundation, although its remit has been significantly changed. Its other functions will be to oversee the self-regulatory activities of the major professional accountancy bodies and the new Audit Inspection Unit that is being established to monitor major audit work.
    The current delegation power in Section 46 has never been used. It was right for its time, but needs to be changed as there is a body already in existence which could carry out the Secretary of State's functions effectively. The change that we are proposing to the existing delegation power will enable decisions on the recognition of supervisory bodies and audit qualifications to be taken by a body that also has responsibility for oversight of the major accountancy bodies. I believe that the synergies that will be achieved will significantly improve the overall independence of the regime and the effectiveness of oversight of the supervisory bodies. That is part of a framework that we have put in place, which, without creating too heavy a superstructure, gives the independence that we are seeking.
    Lord Hodgson of Astley Abbotts: I am grateful to the Minister for that explanation, and for his reassurance that POBA exists. It was not clear to me from the conversations that we have had or from the Explanatory Notes that it had struggled into this world. That makes a difference to what we are discussing, and I am grateful for his explanation of the background to the clause and for the reassurance that he has given.
    Clause 3 agreed to.
    Clause 4 [Circumstances in which Secretary of State may delegate functions to existing body]:
    Lord Hodgson of Astley Abbotts moved Amendment No. 13:
    Page 5. line 41, leave out "to be likely"
    The noble Lord said: We now come to a group of amendments that relate to the delegation of functions to existing bodies. In moving Amendment No. 13, I shall speak also to Amendments Nos. 14, 15, 16 and 17. The amendments focus specifically on Clause 4; our concerns with this clause primarily focus on its drafting and whether it is drafted tightly enough.
    Amendment No. 13 is designed to probe the drafting of subsection (2) of the new Section 46A. According to the Explanatory Notes, subsection (2),
    "provides that the body to whom the functions are to be delegated must be willing and able to exercise the functions and must meet certain other conditions set out in subsection (3)".
    That is in paragraph 25 of the Explanatory Notes.
    We accept and agree with that in principle. No delegation should take place to an existing body unless it is willing and able to carry out the functions delegated to it. However, we are not sure about the drafting in subsection (2)(b). This states,
    "that the body has arrangements in place relating to the exercise of those functions which are such as to be likely to ensure that the conditions in subsection (3) are met".
    Our amendment would remove "to be likely". Arrangements should be in place which ensure that all conditions are met. To say that arrangements were "likely" to ensure that all conditions are met weakens the force of the argument. It raises the question of what criteria the Secretary of State is to use to make his or her judgment as to whether it appears that there are sufficient arrangements in the existing body which are likely to ensure that it can carry out additional requirements under subsection (3). That wording seems vague and ambiguous and does not add much to the drafting.
    That links in with our objection to subsections (3)(b) and (4), which describe the further conditions as specified in subsection (2)(b). The Secretary of State must consider whether the existing body meets these conditions before he makes an order. We have no problem with subsection (3)(a)—that the functions to be delegated will be exercised effectively by the existing body. That is fundamental. However, subsections (3)(b) and (4) are ambiguous and unclear. They say that,
    "where the delegation order is to contain any requirements or other provisions specified under subsection (4), that those functions will be exercised in accordance with any such requirements or provisions",
    and that the,
    "delegation order may contain such requirements or other provisions relating to the exercise of the functions by the designated body as appear to the Secretary of State to be appropriate".
    I am not sure at all what those additional requirements or other provisions are likely to be. What circumstances is the provision designed to cover?
    We would very much like to probe the Minister on those points because they are remarkably open-ended provisions. If the body is going to have to fulfil other requirements or provisions, we should know what these are or at least what they are likely to be. We need to be clear that under Clause 4 the right functions are being passed over to the appropriate body. We currently feel that subsection (4) goes some way beyond what is stated in the Explanatory Notes and provides a considerable degree of discretion to the Secretary of State as to how the provision is to be interpreted.
    In a bid to try to limit the scope of subsection (4), we have tabled Amendment No. 16, which adds the words,
    "for the effective exercise by that body of those functions".
    That was suggested to us by some expert legal advisers, who similarly highlighted the open-ended nature of subsection (4). It expressly links the "requirements or
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    other provisions" which the Secretary of State may specify in that clause with the functions which have been delegated to that body.
    There is also some concern in the legal profession over a possible situation whereby the independence of the body might be compromised under subsection (5). As far as I am aware, the whole purpose of subsection (5) is to allow the body, POBA, to be involved in the independent monitoring subject to the arrangements made by the recognised supervisory bodies under Clauses 1 and 2, but also to take on the functions of the Secretary of State under Clause 4. The explanatory notes state:
    "The aim of this provision is to ensure that the POBA … is not precluded from exercising any delegated function on the basis of its involvement with the arrangements set out in clause 2".
    I am unclear how that dual role will work. What will happen if there is a conflict of interest? How will POBA be able to exercise its role independently under Clauses 1 and 2? We believe that there should be a proviso that the independence of the body is not thereby compromised, especially in view of the fact that while currently the Government have POBA in mind, there might be other bodies in future which could find themselves in a different and difficult position.
    This group of amendments is intended to probe the Minister so we can delve down into a few more details on the intricacies of the provisions and how they will work in practice. I hope, in that spirit, he will give us some clarification on the drafting of Clause 4 and what circumstances that it is designed to meet. I beg to move.
    6.15 p.m.
    Lord Sainsbury of Turville: This group of amendments deals with circumstances in which the Secretary of State may delegate her functions in relation to orders as to an existing body. The noble Lord, having attacked us for setting out these very detailed requirements for the board and having withdrawn that amendment, now has another amendment that says that the requirements are rather modest and that more requirements could be on the board. He can have it one way or the other; either the Secretary of State has responsibility to set some requirements down or she does not. We have a rather limited requirement here. Let me explain the thinking behind it.
    The whole group of amendments deals with the circumstances under which the Secretary of State may delegate a function in relation to auditors to an existing body. As noble Lords will be aware, we expect to delegate those functions to POBA, the Professional Oversight Board for Accountancy, of the Financial Reporting Council.
    Amendment No. 13 would adapt the existing proposed requirement so that it must appear to the Secretary of State that the arrangements which an existing body has in place as to how it will exercise the functions are such that the conditions in subsection (3) will be met—not just that they are likely to be met. As

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    noble Lords will agree, it is extremely important that if statutory functions are to be delegated to an existing non-statutory body, there are provisions in place to ensure that the body is suitable. However, I believe that the current formulation that the arrangements must be such as to be "likely to ensure" that the conditions are met is sufficient. Amendment No. 13 would require a degree of certainty that it is not reasonable to expect in these circumstances.
    Amendments Nos. 14 and 15 would remove the power of the Secretary of State to insert additional requirements into the delegation order. Alternatively, Amendment No. 16 would limit the requirements that can be inserted by the Secretary of State into the delegation order to those that are concerned with the effective exercise by the body of the functions. Bearing in mind that this provision applies only when the functions are to be transferred to a pre-existing body, we consider it prudent to enable the Secretary of State to specify additional requirements or provisions if, and only if, the need should arise. I should emphasise that the House will of course have the opportunity to debate any such provision when the delegation order comes before it for affirmative resolution.
    I shall give an example of the kind of requirement that we have in mind. An example of a specific requirement or provision might be to ensure that, when reporting to the Secretary of State on the exercise of any delegated function, the body includes copies of the reports on audit regulation made to it by the recognised supervisory bodies.
    I now turn to Amendment No. 17. As part of its responsibilities, POBA will oversee the new Audit Inspection Unit which will monitor the audits of listed companies and other public interest entities. POBA's sister boards within the FRC—the Accountancy Investigation and Discipline Board and the Auditing Practices Board—will also be responsible for running arrangements in which we expect that the recognised supervisory bodies will participate in order to meet the new recognition requirements introduced by Clause 1 of the Bill.
    The purpose of subsection (5) is to ensure that the mere fact that POBA has a certain position in the FRC structure does not of itself prevent it from taking decisions on the matters which are delegated to it.
    I do not consider that Amendment No. 17 is necessary. In order to exercise any delegated functions effectively, POBA would have to perform them independently of any link that it has with the standard setting, monitoring and disciplinary arrangements by virtue of its position in the FRC or its functions in that structure. If POBA were to take irrelevant considerations into account in exercising its delegated functions, that would be likely to adversely affect the effectiveness with which POBA could perform its functions, thus calling into question whether it could continue to be the designated body. An example of an
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    irrelevant consideration is whether the standard setting, monitoring or disciplinary arrangements are part of the same corporate structure as POBA.
    Lord Hodgson of Astley Abbotts: I am grateful to the Minister. I take his point on Amendments Nos. 13, 14 and 15. I was not entirely convinced by Amendments Nos. 16 and 17, but we may return to them at a later date when we have read what he has said. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 14 to 17 not moved.]
    Clause 4 agreed to.
    Clause 5 [Supplementary provisions about delegation orders]:
    [Amendment No. 18 not moved.]
    Clause 5 agreed to.
    Clause 6 [Approval of overseas qualifications for auditors]:
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 19:
    Page 8, line 17, at end insert—
    "( ) Any withdrawals. variations or revocations made under subsection (6) shall only apply to individuals not previously admitted under the provisions of this section.""
    The noble Lord said: Clause 6 amends Section 33 of the Companies Act 1989. That section deals with the approval of overseas qualifications of auditors. We of course accept that it is a very sensible provision, as we would always want there to be a facility to allow those who were recognised and qualified as accountants abroad to be able to practise in the UK. The Secretary of State has the power to give detailed specifications of those qualifications in other countries which he or she believes afford the same level of professional competence equivalent to that afforded by a recognised professional qualification in the United Kingdom.
    The change that is being made by the clause, as I understand it and as the Explanatory Notes make clear, is to allow flexibility so that the Secretary of State can recognise some people who hold a qualification but not others. That is essentially based on the premise that a certain foreign qualification might have been thought to be substandard and therefore unsuitable to be on a par with a UK qualification, but might subsequently be improved. In that situation, the Secretary of State would presumably want to approve any auditor who had gained the qualification after a specified date when the level was raised. The notes state other such examples where we agree with the Government that it would be sensible to allow the Secretary of State to recognise a qualification with provisos. That is in the interests of recruiting the best employees to work as auditors in the UK.
    Our amendment focuses, however, on what we believe is an unfair provision. Subsection (6) allows the Secretary of State to withdraw his approval of an overseas qualification after such a date as he may specify. We are concerned about the drafting of the

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    clause. I know that the Minister will tell me that it almost mirrors the provisions already in Section 33(6) of the 1989 Act, merely amended to include the changes made in the new subsections (1), (1A) and (2). However, as I am always at pains to make clear, just because something has already been included in statute does not mean that it is not prudent to look again to see whether the provisions adhere to the principles of fairness, workability, balance and effectiveness that we strive to attain.
    My amendment is intended to probe what I see as a narrow but nevertheless possible abuse in the provision. If someone has been admitted as an auditor in the United Kingdom because he holds a qualification that the Secretary of State has recognised, it is unfair for that approval thereafter to be revoked, thereby prohibiting that person from continuing as a practising UK auditor. As currently drafted, subsection (6) says that the Secretary of State can withdraw his approval of an overseas qualification,
    "after such a date as he may specify".
    I understand that this ensures that if a qualification falls below a level which the Secretary of State believes is equivalent to the standard of a UK qualification, he can revoke his approval.
    We strongly believe that this should apply only to a date in the future; for example, if the Secretary of State realises that the standard of those attaining a particular accountancy qualification is not sufficient for them to practise in the UK as auditors, he should not be able retrospectively to withdraw approval from those who attained the qualification at a time when he approved of it. He could only specify a future date after which anyone with that qualification would not be eligible for practice in the UK. That seems only fair. Someone who has practised for perhaps five years in the UK should not be able to be told his qualification is now no longer recognised and therefore he is no longer approved for working as an auditor in the UK.
    I hope the Minister will tell me that this goes without saying. However, under the current drafting, the Secretary of State appears to be able to specify any date, past or future, for withdrawing his approval on a qualification.
    While we are discussing the clause, I raise some concerns of the professional bodies. They welcome the changes being made to Clause 6, but they believe the method by which overseas audit qualifications are approved and recognised in the UK should be looked at again. With the exception of individuals and qualifications covered by the European Union mutual recognition directive, only one overseas qualification outside Europe—that of the Institute of Chartered Accounts of Australia—has been recognised by the Secretary of State under Section 33 of the Companies Act. This long-standing failure to allow appropriately qualified members from overseas institutes to audit in the UK has led to a damaging impasse. The UK accountancy bodies have reciprocal membership arrangements with overseas institutes. It is clearly an unsustainable position that UK accountants are
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    allowed to audit in overseas territories while accountants from those territories are barred from auditing in the UK.
    A recent consequence of this problem has been brought to our attention. In Canada the authorities have removed the recognition of UK chartered accountants. More jurisdictions may follow. The problem stems from the way recognition is decided upon and granted by the Secretary of State. To date, the UK has required a professional level of recognition rather than individual recognition agreements between recognised qualified bodies in different countries.
    Given that there are five recognised qualifying bodies of audit in the UK, each with a different member composition and viewed differently by overseas authorities, it has proved to date impossible in most cases to arrive at a situation where an overseas authority is willing to do what the Secretary of State here requires and agree to recognise members of all the bodies recognised for audit by the United Kingdom Government. It would be helpful if the Minister could make a few comments on this when addressing the amendment. I beg to move.
    Lord Sainsbury of Turville: I totally agree with the noble Lord that it is right that a person who obtains an overseas qualification that is recognised as being of a sufficiently high standard should be able to rely on it. Others should be allowed also to rely on that qualification. It would not be fair if someone had a perfectly good qualification one day, but not the next, through no fault of his own.
    Under new subsection (6), any withdrawal of approval of a qualification, or variation or revocation of a specified requirement, would apply from a date specified by the Secretary of State. In the event that this provision was used, the Government's policy is that a retrospective date should not be specified. Moreover, it is unlikely that this provision would be construed as providing a power to act with retrospective effect. Such a construction would not accord with the general principle against retrospectivity.
    I am told that if pressed I should draw noble Lords' attention to paragraph 1285 of Halsbury's Laws of England (Fourth Edition) volume 44(1). It states:
    "The presumptions that prevail on the question of whether by implication an enactment is or is not intended to be retrospective are based initially on the nature of legislation, which gives rise to the general presumption against retrospectivity. Thereafter those presumptions depend on the concept of fairness. It is because of the general presumption against retrospectivity that an enactment will not normally be treated as retrospective even where to do so would not be unfair to any person".
    The noble Lord's question about overseas qualifications is not directly relevant to this issue, but I will take it away and write to him specifically about it. It is a slightly different but important point.
    6.30 p.m.
    Lord Hodgson of Astley Abbotts: I am grateful to the Minister for that reassurance on retrospectivity and

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    the learned quote from Halsbury's Laws of England. It was not exactly on the tip of tongue, and I am very grateful for the tutorial. I appreciate the point about the overseas institutes. Although it is not directly relevant here, I thought it was worth while ventilating while we are discussing overseas qualifications. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 6 agreed to.
    Clause 7 [Disclosure of services provided by auditors and related remuneration]:
    Lord Hodgson of Astley Abbotts moved Amendment No. 20:
    Page 8, line 27, leave out "or by their associates"
    The noble Lord said: This group of amendments probes the issue of disclosure. This is our first sortie into Clause 7, and it might be worth outlining our general approach to disclosure. We favour disclosure; it is in the interests of both the company and the shareholders, but there are a number of issues in Clause 7 it is important to explore with the Minister.
    This group of amendments attempts to probe the Government on the definition of associates. Throughout this clause, we see that provision about disclosure is to be contained in regulations drawn up by the Secretary of State. Subsection (1) states:
    "The Secretary of State may make provision by regulations for securing the disclosure of—

    (a) the nature of any services provided for a company by the company's auditors (whether in their capacity as such or otherwise) or by their associates;

    (b) the amount of any remuneration received or receivable by a company's auditors, or their associates, in respect of any services within paragraph (a)".

    It is understandable that the details of how disclosure is carried out will be contained in secondary legislation. We are more concerned about paragraphs (c) and (d) of subsection (3), which state that the regulations will apply to services provided for associates of a company as well as the company itself, and that the definition of "associate" in relation to an auditor in a company will also be contained in regulations. We have, then, two definitions of associates.
    Lord Borrie: May I interrupt? It is the associates of the auditors, is it not?
    Noble Lords: No, it is both.
    Lord Borrie: I apologise. Thank you.
    Lord Hodgson of Astley Abbotts: We have two definitions of "associate": the associates of the company's auditor, as mentioned in subsection (1), and the associates of the company itself, as mentioned in subsections (2)(c) and (3)(c). Maybe I am wrong, but that is how I read it. It would be helpful if the Minister could shed some light on whether there are one or two associates—I think there are two—and how associates will be defined in relation to each of these two types.
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    It would be unfair if a company organised itself, probably at considerable expense and administrative dislocation, in relation to disclosure issues on the basis of the definition of "associate" as set out in one set of regulations, only to be faced with a situation in which the definition changes and the company's structure and organisation is thereby thrown into turmoil. Can the Minister give any assurances that there will be a definition of "associate" to which auditors and companies can work, safe in the knowledge that it is unlikely to change?
    Disclosure is an area of great sensitivity. For our part, to avoid problems, we feel that on the whole it would probably be in the interests of greater transparency for the definition of "associate" to be on the face of the Bill.
    No doubt the Minister's official brief will say that a definition in regulations is necessary on the grounds of flexibility. If that is so, we need to know what the definition will be and how likely is it that it will be changed, because change would be disruptive and cause confusion. Some thinking from the Government on the circumstances in which the definition might be tinkered with would be helpful. We already know from paragraphs 35 and 36 of the Explanatory Notes that the definition of "associates" is being widened. Can the Minister comment on why that change was felt necessary?
    As I will be arguing in the next group of amendments, we are unhappy with the perhaps unnecessarily prescriptive rules being imposed on disclosing too specifically. If "associates" is taken at its broadest, then an awful lot of time and energy will have to be put into dissecting the services provided by auditors and remuneration provided to auditors in order to comply. After reading Clause 7, I find myself almost completely in the dark, since every one of the five principal subsections begins with that most elusive phrase "regulations may provide". Perhaps the Minister can enlighten us on the Government's thinking. I beg to move.
    Lord Sharman: This group of amendments addresses a matter of a delicate balance. As the noble Lord, Lord Hodgson, has rightly said, we are dealing with the remuneration paid to associates of the auditors in one case. In another case, we are dealing with remuneration expended by associates of the company. In so far as associates of the auditor are concerned, there is a difficulty because the auditor, if my memory serves me right, would have to be a registered auditor, and to be a registered auditor, it would have to have a certain percentage of its ownership in the hands of registered auditors. Services provided by other bodies within the same global arrangement, as it were, would therefore not be provided by the auditor. So I think it is very important that the regulations include an appropriate definition of "associate" in the broadest sense.
    I am cautious about incorporating that definition in statute, for one very simple reason. I spent a great deal of my working life in an organisation which might be affected by that and contains a large number of very

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    inventive people. I believe that this will be a moving definition, and flexibility will be needed for that. So I caution the Minister about his approach, if I might be so bold.
    As regards the associates of the company, there is already a definition of an associated company—it sits there in accounting parlance. There we can afford to take a much tighter approach to the definition. I would encourage the Minister to be flexible on the one hand but more rigorous on the other.
    Lord Sainsbury of Turville: With Amendment No. 20, I propose also to speak to Amendments Nos. 21, 22, 25 and 26. I very much welcome the support for the general principle of the clause, but I think that to delete "associates" from the clause would be very unwise. It seems to me always wrong to have a piece of legislation where those legislating and those being legislated for can immediately see enormous scope for getting round the legislation. If you took out "associates", you would simply encourage people to do that. I think that "associates" will be defined in the regulation, which is probably the right place to do it.
    There is widespread agreement that greater disclosure is needed to increase transparency about the relationship between the company and its auditors, enabling judgments to be made about the relationship between the auditor and the client. Strengthening the disclosure requirements forms part of the Government's overall "post-Enron" package of reforms, as recommended by the Co-ordinating Group on Audit and Accounting Issues.
    Before I explain why, in the Government's view, these amendments should be resisted, I would like briefly to explain what the existing requirements are and how this clause extends them.
    Under existing Section 390A of the Companies Act 1985, companies are already required to set out in their accounts the amount they have paid their auditors for audit work and, through regulations made under Section 390B, the amount they have paid them for any non-audit work. But there is currently no requirement for the company to explain what different types of non-audit service have been purchased, nor to give anything other than a single, aggregate figure for the amount spent. This clause remedies that by giving the Secretary of State the power to make regulations requiring the company to set out more detail about the cost and nature of the non-audit services.
    The reason we consider that to be important is simple. We recognise that the provision of certain services by the auditors could potentially compromise their independence—for example, through the provision of tax services. However, that depends on the type and scale of the service provided, and therefore we wish such information to be made public by the company. The alternative would have been to ban such services altogether. But we prefer proper disclosure and transparency, and that approach probably has cross-party support.
    We are replacing Sections 390A(3) and 390B with a new Section 390B, which enables the Secretary of State to make regulations requiring disclosure by companies
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    of the nature of the services provided to a company by its auditors and associates and the amount of remuneration to be paid for those services. The new provision will ensure that disclosures about audit and non-audit services are brought together in one place.
    I believe that it would be helpful to remind ourselves of those overall objectives before turning to the amendments themselves. I shall deal, first, with the associates of the auditor. The existing requirement is in respect of non-audit services provided by both the auditor and its associates, and the new requirement should be, too. The whole purpose of the disclosure is to make public the commercial relationship between auditor and company to ensure that there are no potential conflicts of interest or threats to independence. Permitting the company to say nothing about a service purchased from another part of the audit firm's network, as would be the result of the amendments, would defeat that object since clearly such a purchase could be highly relevant to the question of independence.
    The Institute of Chartered Accountants in England and Wales has produced best-practice guidance on disclosure by companies of the nature and cost of services provided by auditors. We have worked with the institute on this guidance. With regard to auditor associates, the guidance specifically states,
    "for the purposes of disclosure, the auditor includes the principal auditor and its network firms around the world".
    As recommended by the Co-ordinating Group on Audit and Accounting Issues, we will need to evaluate reaction to the guidance before coming to a final decision about how associates of the auditor are to be defined in the regulations. We shall, of course, consult publicly on draft regulations—a point which is relevant in regard to all the amendments on this clause. Of course, regulations are a legal instrument and therefore the definition will, of necessity, have to be framed in a more precise way than is the case in best-practice guidance.
    The argument about the associates of the company is slightly different. Under the existing regulations, an associated undertaking in relation to a company means its UK subsidiary undertakings. Again, I quote from the guidance on disclosure from the Institute of Chartered Accountants in England and Wales on the nature and cost of services provided by the auditor, as the regulations made under Clause 7 are likely to reflect the guidance:
    "Fees for work performed during the period for associates and joint ventures would not normally be disclosed. However, this should be considered on a case-by-case basis and additional disclosure would be appropriate if associates and joint ventures form a particularly large part of the group financial statements".
    We agree with that. The primary legislation is therefore drafted in such a way that we can, if we decide it is necessary to do so, require additional disclosure about associates and joint ventures in the regulations.
    We are also extending the definition of "associate of a company". Clause 7 ensures that services provided to associates of the company which are not "undertakings" may be included in the regulations as

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    part of any disclosure. That would cover entities such as the company's pension fund. In our view, it could be of relevance to the question of the audit-client relationship that services have been provided to such an entity. The regulations should therefore be capable of being extended to cover them.
    We are sympathetic to the overall desire and need for the regulations to be carefully drafted in order to avoid unnecessary and complicated disclosure. We shall consult on draft regulations at the end of the year, together with a draft regulatory impact assessment. We shall not bring forward regulations which impose more requirements than are strictly needed to meet the policy objective. I hope that, on that basis, the noble Lord will feel able to withdraw the amendments.
    Lord Hodgson of Astley Abbotts: I am grateful to the Minister for the peroration at the end, bearing in mind that the regulatory impact of the provision is important. I accept the argument that "associates" is, or will have to be, a moving target if put into regulations. The amendments were designed to probe and to put the thinking on the record, and I am happy to beg leave to withdraw Amendment No. 20.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 21 and 22 not moved.]
    6.45 p.m.
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 23:
    Page 8, line 43, at end insert—
    "(d) that where a company is part of a group such disclosures may be on a group basis"
    The noble Lord said: In moving Amendment No. 23, I shall speak also to Amendment No. 24. Here, we are concerned with how specific disclosure is intended to be under the regulations in subsection (2). At present, the drafting of the subsection is ambiguous. Paragraph (a) talks about the,
    "disclosure of the nature of any services provided to be made by reference to any class or description of services specified in the regulations (or any combination of services, however described)".
    That seems to be fairly vague. What degree of detail are we talking about here? Are the Government thinking along the lines of a limited number of categories—for example, audit, tax, IT implementation, advisory, covering business strategy and so on? If so, that is probably an acceptable approach.
    We wonder whether it is desirable to have a breakdown into amounts received for individual assignments or the kind of situation where a company would have to disclose fees incurred for a proposed take-over bid. Certainly, disclosure should not be so over-prescriptive that fee rates are exposed. There is an argument that that is a matter of commercial confidence and one where the marketplace should rule.
    The amendments are aimed to try to strike a balance. It is important, for two reasons, that regulations are not too detailed and over-prescriptive. First, there is an issue of group companies. When subsection (2)(c) talks about "separate amounts", does that mean for each individual company or for the group as a whole? Some companies, as part of a large group, would have a very large administrative burden on their hands in trying to disclose every specific figure for each company in the group.
    The Explanatory Notes are not particularly clear on this issue as they state, at paragraph 34 on page 9, that.
    "it will be possible to require separate disclosure of amounts paid in respect of tax advice by each company in a group or an aggregate figure for tax advice for the group as a whole".
    The two examples are very different. It would be helpful if the Minister could tell us which way the Government's thinking is tending—tax advice for each company in a group or a figure for the tax advice for the group as a whole? It is important to clarify that issue.
    Secondly, following on from that point, how broad or narrow will the categories be? We are all in favour of transparency, as we have made clear in earlier debates, but there would be issues of compliance with, for example, the FSA's market abuse provisions if one was required to provide intricate details of specific services. We are convinced that disclosure should be by broad category of service, and that is perfectly adequate to meet the Minister's requirement that shareholders or potential shareholders should be able to make a judgment. But this approach is by no means clear from the current drafting of the Bill. I hope that it will be made clearer in regulations.
    While full disclosure of non-audit activities is to be applauded, there may be circumstances where it is not in the company's, or indeed the shareholder's, interest to give full disclosure—for example, where confidential, price sensitive or commercially sensitive information is involved. In many situations, such as take-over bids for other companies, disclosure would not be advisable. I look forward to hearing the Government's thinking on this point. I beg to move.
    Lord Freeman: I support Amendment No. 24 in the name of my noble friend Lord Hodgson and shall add a little detail based on my own personal experience. Before I do so, perhaps I may say that I very much agree with the Minister about the principle of disclosure and I hope to support what my noble friend said. It is right that non-audit fees are disclosed where an audit firm has a relationship that extends beyond merely auditing. That must be right in the sense that it will be for the different regulatory bodies and the general public to judge whether a prima facie case of influence is being brought to bear on the auditors by the non-audit partners in that firm. Therefore, I have no problems about disclosure.
    However, a small matter of equity is involved here. Perhaps I may explain that and ask the Minister to consider the record when regulations come to be drafted. I am adding a little detail to what my noble friend Lord Hodgson said. There are two types of fee

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    basis that firms of accountants charge: one is time and the other is percentage or contingent fees. Contingent fees are charged on a very narrow range of services, normally acquisitions and sales of businesses. Over the past 10 years, major accountancy firms—I cannot speak for the medium-sized firms, but certainly the big four—compete head on with investment banks in a certain segment of the market which is called the mid-cap.
    In my judgment, it would be very inequitable if investment banks were not forced to disclose their fee rates, the percentage rates which are highly competitive, highly market-sensitive and I believe commercially confidential. Accountancy firms have to disclose them. That would be unfair to the profession. It seems to me that some form of aggregation should be permitted and my noble friend Lord Hodgson has already indicated aggregation perhaps of tax or IT implementation—to the extent that that service is still provided—and general advisory services. The general public and the regulatory bodies should be interested in the total amount of the fee paid. A small part of the fees paid to accountancy firms is commercially sensitive, as my noble friend said, and it would be inequitable to single out accountancy firms to disclose through the annual accounts of their clients the precise nature of the fee because it could be worked out very quickly and it would be to their disadvantage. I support the general thrust of Amendment No. 24 and I hope that the Minister will reflect on the matter before producing draft regulations.
    Lord Sharman: Perhaps I may make a couple of observations on what should be disclosed. First and foremost, I shall touch on the issue of contingency and percentage fees. It is my understanding that the Institute of Chartered Accountants does not allow percentage fees for audit clients. That is one of its ethical standards which has been recently adopted so that one would not have a situation with an investment hanker. The disclosures that have taken place today are working up into what I would call a statement of best practice. At the moment a listing agreement requires disclosure of non-audit fees. Increasingly audit committees take a great deal of interest in determining the relationship with the auditors, as they are required to under the revised arrangements, which were incorporated after the Higgs and the Smith reports. There is a good body of practice which already exists about what should be disclosed and what is sensible. I encourage the Minister, when debating the regulation to look at what is happening at the forefront so that we have a regulation that is readily accepted.
    Lord Freeman: Clearly the noble Lord, Lord Sharman, is right. We "SEC attested" audit clients, but how the fee is calculated for non-SEC attested audit clients in the Untied Kingdom ultimately would be expressed in terms of the percentage. It is the percentage rate of the fee, however negotiated, that is important and commercially sensitive.
    Lord Evans of Temple Guiting: I shall speak to Amendments Nos. 23 and 24. The amendments reflect concerns as to whether groups preparing consolidated accounts will need to provide for disclosure below the consolidated level. That is certainly a point that we will need to consider carefully when drafting the regulations. We recognise the concerns raised by noble Lords and in particular the desire to avoid burdensome regulations. We shall be looking to business itself to help us in evaluating the economic impact of these new requirements as part of a cost-benefit analysis to be published in a draft regulatory impact assessment which we expect to have drafted by the end of the year along with draft regulations. We shall not proceed with any requirement whose cost is estimated to outweigh its benefit. But that does not, we believe, argue for removing the power to provide for disclosure below the group level. While for some, maybe most, non-audit services group level disclosure will be appropriate, there may be instances when disclosure below this level is appropriate in the interests of transparency. It would be wrong to remove this flexibility only to discover at a future stage that there are circumstances when we want to be able to require disclosure below the group level, even if those circumstances are very limited.
    The noble Lord is also seeking a broad categorisation of the classes and description of the services provided by the auditor. I can assure him that we envisage a broad classification of types of non-audit services. We will draw on the categories in the ICAEW guidance which are themselves in line with those in the European Commission's recommendations on auditor independence.
    We will want to be sure that the categories are effective and clear. We expect the categories to be: audit services, broken down into statutory audit and audit-related regulatory reporting; further assurance services; tax services, broken down into compliance services and advisory services; and other non-audit services, which will be broken down under a series of headings, such as financial information technology, internal audit, valuation, litigation and recruitment.
    We will be consulting with the Auditing Practices Board, among many others, to ensure that these map across to their independence standards for the audit profession. However, there may be occasions when a more detailed definition of the nature of the services may become necessary, so again, we wish to retain the flexibility to make regulations to cover this.
    Let me assure noble Lords that it is not our intention to produce vast amounts of additional specifications. I repeat that we are sympathetic to the concerns and the overall desire and need for the regulations to be carefully drafted to avoid unnecessary and complicated disclosure.
    We will take into account the very interesting points made by the noble Lord, Lord Freeman, and the noble Lord, Lord Sharman, when drafting the regulations. It is important to put on record that we will be working closely with the accountancy profession as these rules and regulations are drafted.

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    Finally, the amendment reflects concerns about whether a disclosure under this power might run counter to the Financial Services and Markets Act 2000 rules about the release of market-sensitive information. We think this is a hypothetical scenario, given the broad classification of services proposed. What is more, the disclosure is made once a year, after the event. Even if it shows that the company spent a certain amount on, for example, getting its auditor to do due diligence work, that does not tell the markets anything worth knowing about its takeover and merger plans. If the company really does not want to have to disclose any information at all in this regard, the answer is simple—go to anyone else other than the auditor for this service. I must remind Members of the Committee that the objective is only to require disclosure when the firm carrying out the audit is also carrying out other work—nothing else.
    The noble Lord, Lord Hodgson, raised the question of tax advice. We want to ensure that the disclosure of separate amounts of remuneration paid by the company and its associates can be required in respect of the aggregate amounts of remuneration received in respect of a particular class or description of services from the company and its associates. If, for example, we wish to require disclosure of remuneration received in respect of tax advice, we shall be in a position to require disclosure of each separate amount of remuneration received from each company in the group rather than being able to require an aggregate figure for tax advice remuneration to the group as a whole. We have not yet reached a decision on this one but we shall consult with the profession.
    7 p.m.
    Lord Sharman: Before the noble Lord sits down, is he able to confirm my understanding of his remarks, which is that the nature of disclosure which will be regulated will require disclosure of the nature of services and the quantum of money paid for those services, but will not require disclosure of the basis on which the fees are arrived at?
    Lord Evans of Temple Guiting: That is correct.
    Lord Hodgson of Astley Abbotts: This has been a most helpful debate and I am grateful to the noble Lord, Lord Sharman, and my noble friend Lord Freeman for their expert detailed back-up. Accepting the need for disclosure and transparency, the comfort I took from the Minister's response was that the Government would look to the profession and to business to help in drafting cost-effective and workable regulations and that we are going down the route of broad classifications, not highly detailed ones. In those circumstances I am happy to beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 24 to 26 not moved.]
    Lord Hodgson of Astley Abbotts moved Amendment No. 27:
    Page 9, leave out line 28.
    The noble Lord said: This amendment is intended to probe the thinking behind subsection (7). This subsection states:
    "The regulations may make different provision for different cases".
    At first glance I was not entirely sure that I understood what this meant. It implies that some companies should be subject to more stringent regulation on disclosure than others. This would seem to be an unlevel playing field. Once one accepts the principle of disclosure it seems fair enough to assume that all companies should act according to the same rules.
    I was more encouraged when I turned to the Explanatory Notes. At paragraph 39 they explain:
    "It enables the regulations to differentiate, for example, between larger and smaller companies. It is intended that, as at present, the detailed disclosure requirements relating to non-audit services will not apply to companies qualifying as small or medium-sized (SMEs) under the Act. SMEs will, however, have to continue to disclose the audit fee itself where relevant".
    We certainly welcome any measure which recognises that regulatory burdens on small and medium sized companies should be alleviated as far as possible. When reading this Bill it is very easy to think in terms of FTSE 100 or 350 companies and big business and to forget the smaller companies which will have less time, staff or expertise but will be forced to handle the same amount of regulation. Can the Minister, therefore, shed any light on this intention to disapply detailed disclosure requirements for SM Es? While we are on the subject of disapplication, could he give us any idea, in general, of any other exemptions for SMEs in this Bill? Many SMEs will not have internal audit facilities. Are they still forced to fulfil every regulation which their larger colleagues are under this Bill? It brings us back to the issues raised in the debate we had on Clause 2 on listed companies and the imbalance between the FTSE 350 index and the rest of the market. I welcome the thought that the Government need and accept a lighter regulatory touch for SMEs and I look forward to hearing the Minister's thoughts on this issue. I beg to move.
    Lord Evans of Temple Guiting: I recognise that with this amendment the noble Lord, Lord Hodgson, may seek an indication of how this power to make different provisions for different cases might be exercised.
    Let me explain the reason for this provision. There may be instances where we would wish the regulations to differentiate, for example, between larger and smaller companies. This is provided for in this section; that is, subsection (7) of the new Section 390B which is the subject of the noble Lord's Amendment No. 27. As under the present regulations, we intend to continue to exempt small and medium-sized companies from the disclosure requirements relating to non-audit services. This is not, therefore, an amendment we can accept. Having heard my explanation, I hope that the noble

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    Lord will feel able to withdraw the amendment. I shall write to him about the point he raised about SMEs. I shall do so within the next few days.
    Lord Hodgson of Astley Abbotts: The Minister was kind enough to give the reassurance and the clarification that I sought. I look forward to receiving his letter. In the mean time, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Hodgson of Astley Abbotts moved Amendment No.. 28:
    Page 9, leave out line 29.
    The noble Lord said: The Committee will be relieved to hear that I can be extremely brief on this amendment. It seeks to leave out subsection (8) of new Section 390B which reads:
    "Nothing in subsections (2) to (7) affects the generality of subsection (1)".
    I have no idea what this means in terms of the practical enforcement of compliance with regulations about disclosure as set out in this new section. Will the Minister please enlighten me and the Committee? I beg to move.
    Lord Evans of Temple Guiting: The noble Lord is probing why we need new subsection (8), which states:
    "Nothing in subsections (2) to (7) affects the generality of subsection (1)".
    The explanation concerns the logical construction of the section rather than policy as such. The first subsection of the clause deals with its main objective; namely, to permit the Secretary of State to make regulations which require the disclosure of the nature of any services provided by the auditor, and the cost of those services, broken down into certain categories.
    The following subsections then set out various matters which the regulations made under this power may provide for. But they are not intended to be exhaustive. The role of subsection (8) is to ensure that this is the case. If it were deleted, as the amendment seeks to do—I fully accept that this was tabled as a probing amendment—then the power might be read as being limited by the specific provisions in subsections (2) to (7). That is not the intention of the clause and we want to make that absolutely clear. To put it another way, subsections (2) to (7) specify provisions that may be included in the regulations, but they should not preclude the possibility of other provisions being made in order to achieve the clause's objective. The effect of deleting subsection (8) would be to prevent the regulations saying anything other than what was provided for in the subsections.
    Lord Hodgson of Astley Abbotts: I am grateful to the Minister for that. Parliamentary draftsmen, like God, move in mysterious ways. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts moved Amendment No. 29:
    Page 9, line 35, leave out "accordingly ceases to have effect" and insert "ceases to have effect when regulations under section 390B(l) come into force"
    The noble Lord said: I rise to speak to Amendment No. 29. In Clause 7—
    The Deputy Chairman of Committees (Viscount Simon): A Division has been called. The Committee stands adjourned until 7.18 p.m.
    [The Sitting was suspended for a Division in the House from 7.8 to 7.18 p.m.]
    Lord Hodgson of Astley Abbotts: I rise to speak to Amendment No. 29. In Clause 7 on page 9, subsection (2) at the bottom of the page appears to delete two provisions with immediate effect. I do not think this can be right. They should be deleted only when the regulations referred to in the preceding section have actually been made; otherwise, there will be a period of non-disclosure which would obviously be unadvisable.
    I had the opportunity to quiz some members of the Bill team about this matter. They assured me that the regulations were intended to come in with immediate effect; that is, simultaneously with the commencement of the Bill. However much I may be reassured on this point as a non-lawyer, there appears to my untutored eye to be no provision in the Bill which guarantees that that is the case. Ashurst, the City law firm, which has given us helpful advice on the Bill, believes that there is a gap. Can the Minister clarify the situation? Our amendment is merely designed to plug that gap by making it clear that the relevant provisions cease to have effect when the regulations come into force. I beg to move.
    Lord Evans of Temple Guiting: I am grateful to the noble Lord for raising this point because it gives me an opportunity to state on the record exactly how a clause such as this, which repeals an existing requirement and replaces it with a new one, will operate.
    I appreciate that this amendment has been tabled to ensure that there is no gap between the repeal of existing legislation and the commencement of our new legislation. We recognise the concerns of the noble Lord but let me assure those present today that the repeal of Section 390A(3) will not be commenced until the regulations are in place. In short, there will be no such gap. "Ceases to have effect" does not mean ceases to have effect immediately. As a result of Clause 62(1), in fact it means ceases to have effect on a day appointed by the Secretary of State by order. The appointed day will be the same as the day on which the regulations made under this clause come into effect. I hope that that reassures the noble Lord.
    Lord Hodgson of Astley Abbotts: Indeed, it does. It is wonderful that the phrase "ceases to have effect" carries with it implicitly the words "on a day appointed by the Secretary of State", and I should have known that. How silly of me not to have grasped that. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 7 agreed to.
    Clause 8 [Auditors' rights to information]:
    Lord Hodgson of Astley Abbotts moved Amendment No. 30:
    Page 10, line 9, leave out "accounts and vouchers" and insert "and accounts"
    The noble Lord said: We are now moving into Chapter 2 of the Bill and dealing with accounts and reports. In moving Amendment No. 30, I shall speak also to Amendments Nos. 34, 37 and 40. The amendments relate to Clause 8 and the type of information to which the auditors are allowed access. I have had the delightful privilege of being told by the accountants that these amendments are ridiculous and by the Law Society that they are wonderful. Therefore, the professions are at odds on this one.
    The information is specified in the Bill as being of,
    "the company's books, accounts and vouchers (in whatever form they are held".
    Our amendments seek to remove the word "vouchers" from this drafting of the Bill. I do not suggest that that will bring about any fundamental change to the Bill, nor, indeed, is that the intention. Instead, the amendments aim to help to modernise company law by dispensing with redundant references which no longer need to clog up our legal system.
    No doubt the Minister will argue that "vouchers" is included in the wording of existing legislation and that any change to the established wording runs the risk of the courts drawing the conclusion, at a later date, that Parliament's will was in favour of some underlying policy change on this issue. I reject that interpretation as a counsel of despair.
    The Minister will be familiar with my wish, in the interest of deregulation, constantly to review critically the wording of statutory instruments to ensure that they reflect modern conditions. It is a process to which I have referred in my debates with him as "removing the barnacles". If we do not remove the barnacles, the ship of state moves at an ever slower pace through the water.
    Ample confusion already exists in company law with the impenetrable cross-referencing of sections between the various Companies Acts, frustrating not only me but the majority of professional legal practitioners. This long overdue renewal of company law may be a distance away but this is just a small example of an improvement that will bring company law into line with modern parlance and usage.
    We are encouraged in our view by the Law Society, which, commenting on this amendment, said:
    "We have reviewed the amendments that you have tabled and in general we are supportive of your proposed changes to the Bill. The Committee is particularly pleased that you are intending to seek the deletion of the word 'vouchers' from the phrase `company's books, accounts or vouchers' to which an auditor would have a right to access under clause 8.
    Comments from the Law Society's Company Law Committee expand upon that further. It says:
    "Perhaps the opportunity could be taken to modernise and clarify the expression 'books, accounts and vouchers.".
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    I stress that the amendments are not in any way intended to change the meaning, direction or implication of the clause. I invite the Minister, when he comes to reply—in accepting the amendment, of course—to make it clear that no underlying policy change is meant or intended. The intention here is simply to abandon an anachronism and, in so doing, to help to bring company law up to date with a more genuine reflection of contemporary company practice. As I know the Minister will recognise, Bob Cratchit has had his day. We live, for better or worse, in an electronic age. So away with vouchers; away with a barnacle. I beg to move.
    Lord Sharman: I speak for my side. I want to speak to this amendment because I believe that there is a fundamental difference between lawyers and accountants on this issue. It is all very well to talk about modernisation of company law. There are three aspects here. The books of a company are the fundamental records in which transactions are recorded. They have moved and modernised. When I was a boy they were kept on pieces of paper and today there is electronic inscription.
    The accounts of a company are the summaries of the transactions recorded in the books which are presented to those who have an interest in the results of the operation. They can be filed electronically, but I would submit that the vouchers have not changed. The vouchers are the pieces of paper that support the transactions that are in the books. They are the invoices for goods, the sales invoices, and so on. Take them away from the auditor and there is no audit.
    Lord Borrie: What an excellent speech that was.
    Lord Sainsbury of Turville: I agree with the noble Lord, Lord Sharman, that the word "vouchers" has a very old-fashioned feel to it. In this context, I believe it is the right word. There are dangers in changing well understood terms and introducing a change of substance where none is intended.
    Under existing legislation, as set out in Section 389A of the Companies Act 1985, a company's auditors are given access to a company's books, accounts and vouchers. The word "vouchers" in this context means documents which vouch for or provide evidence of a transaction such as invoices and receipts, to which of course the auditor must have access as of right. We decided to retain that terminology to avoid introducing any doubts as to whether the scope of the material to which an auditor has right of access was being altered in any way.
    As you see, we have made it clear that the auditors have the right to access those items in whatever form they are held, which would include electronic forms. On that issue, if on no other, it is accountants versus lawyers, and that is based on a great deal of experience over the years of where fraud often starts, which is on the vouchers. Fraud rarely starts in the accounting process. People claim to have assets that are not there and claim to have modern stock that they can sell when it is out of date or does not exist. Vouchers are the essence of what one needs for fraud.

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    While I have some sympathy with the sentiment underlying the amendment, this is where the accountants have a stronger case and we do not believe that it is necessary or desirable to change the wording in the Bill.
    Lord Hodgson of Astley Abbotts: I said that accountants and lawyers are diametrically opposed. One rarely receives completely opposing briefing, but it was interesting. I understand the points that have been made. I am not surprised. We discussed the matter with the Bill team. I had hoped that the Minister would be able to get round the point about the will of Parliament changing by saying that the will
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    of Parliament was not changing, but I see the point that is being made. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Evans of Temple Guiting: This may be a convenient moment for the Committee to adjourn until tomorrow at 3.30 p.m.
    The Deputy Chairman of Committees (Viscount Simon): The Committee stands adjourned until Wednesday, 17 March at 3.30 p.m.
    The Committee adjourned at twenty-nine minutes past seven o'clock.

  Peers: House of Commons Select Committees
  Peers: House of Commons Select Committees
  Armed Forces: Cannabis
  Armed Forces: Cannabis
  Speed Cameras
  Speed Cameras
  Railways: Selective Door Opening
  Railways: Selective Door Opening
  Channel Tunnel: Train Paths
  Channel Tunnel: Train Paths
  Railways: Bridge Strengthening at Plumpton and Salwick
  Railways: Bridge Strengthening at Plumpton and Salwick
  Playing Fields
  Playing Fields
  Elite Sport Funding Review
  Elite Sport Funding Review
  Licensing Act 2003: Premises Licences
  Licensing Act 2003: Premises Licences
  Community Sports Coaches
  Community Sports Coaches
  Biodiesel: Duty Income
  Biodiesel: Duty Income
  National Insurance Contributions: Deficiency Notes
  National Insurance Contributions: Deficiency Notes
  National Lottery: Proposed Olympic Games
  National Lottery: Proposed Olympic Games
  Trading Balances
  Trading Balances
  Oldham Metropolitan Borough Council: Sports Expenditure
  Oldham Metropolitan Borough Council: Sports Expenditure
  Colchester City Council: Sports Expenditure
  Colchester City Council: Sports Expenditure
  Horserace Betting Levy Board: Assets
  Horserace Betting Levy Board: Assets
  Teenage Pregnancies
  Teenage Pregnancies
  Boundary Committee: Lancashire Recommendations
  Boundary Committee: Lancashire Recommendations
  Planning Appeals: Knotts Drive, Colne
  Planning Appeals: Knotts Drive, Colne
  Adventure Capital Fund
  Adventure Capital Fund
  Fire Safety: Legislation
  Fire Safety: Legislation
  NAO Report: Success in the Regions
  NAO Report: Success in the Regions
  Accident and Emergency Departments: Violent Patients
  Accident and Emergency Departments: Violent Patients
  Intermediate Care for the Elderly
  Intermediate Care for the Elderly
  Cormorants and Fisheries
  Cormorants and Fisheries
  Coastal Protection Schemes
  Coastal Protection Schemes
  Pesticides: Withdrawn Products
  Pesticides: Withdrawn Products
  Imidacloprid and Bees
  Imidacloprid and Bees

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

  I have today placed in the Library guidance developed by the Association of Chief Police Officers on the deployment and use of water cannon, together with a medical statement by the independent medical panel on the use of water cannon. Copies of these documents have been placed in the Library of the House.

  With the publication of this guidance and the final medical statement, the water cannon purchased by the Police Service of Northern Ireland can now be deployed operationally for use in appropriate circumstances.

  School Teachers' Review Body
  The Parliamentary Under-Secretary of State, Department for Education and Skills (Baroness Ashton of Upholland)
  My right honourable friend the Secretary of State for Education and Skills (Mr Charles Clarke) has made the following Written Ministerial Statement.

  Introduction

  The second part of the 13th report of the School Teachers' Review Body is being published today. It covers all matters related to the rewards and incentives agreement and a range of residual matters not covered in the first part published in November 2003. Copies are available in the Vote Office and the Library of the House of Lords and at http://www.teachernet.gov.uk/management/payandperformance/pay/2004/STRBreportMarch2004/

  In making its recommendations, the review body was required to have regard to the matters set out in the remit letters of 1 August 2002, 11 July 2003 and 9 January 2004. The STRB report deals with a wide range of weighty and complex issues and I particularly want to thank the body for the exemplary way it has responded to the additional remit on issues related to the upper pay scale. I remain indebted to both the review body and the other partners for the continued dedication and professionalism that they bring to this process. The STRB recommendations are set out below followed in each case by my response.

  I am seeking consultation comments on the report and my response by 16 April 2004.
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  Upper Pay Scale

  The STRB has recommended the following (in bold):

  The content of Annexes A and B need to be reflected in pay legislation;

  Annexes A and B are further clarified, strengthened and communicated in the way set out above;

  The upper pay scale should now cease at UPS3;

  (a) that a new excellent teacher scheme is established;

  (b) that the scheme should be open only to classroom teachers who have reached UPS3 and who demonstrate that they have distinguished themselves at that level;

  (c) that the period before a UPS3 teacher becomes eligible to attain the status of an excellent teacher should normally be three years and that the first awards under the scheme should be made in September 2007;

  (d) that the scheme as developed should take into account the following considerations:

  it should include a process for application and assessment as rigorous as the AST process, using the same concepts of national criteria and a national assessment model;

  it should include an element of external assessment;

  the criteria should ensure that only the very best teachers can achieve the new status provided by the scheme and should include a programme of study leading to an appropriate qualification;

  the salary should reflect the quality of improvement in teaching and learning intended to result from the scheme.

  I welcome the positive and helpful way the STRB has responded to the issues around the upper pay scale. The depth of its response indicates the seriousness with which it undertook this additional remit and I am grateful for this thoroughness.

  The rewards and incentives agreement I signed with our pay partners on 9 January affirmed two important principles. The first was that good classroom teachers should he able to aspire to a salary which reflects their important achievements in raising standards. The second was that the highest rewards for classroom teachers should be awarded for excellence.

  I am particularly pleased that, through its recommendations that the upper pay scale should cease at UPS3 and that a new excellent teacher scheme be established the STRB too recognises the importance of these principles. I therefore endorse these two proposals.

  The STRB has made further recommendations concerning amplifying and clarifying the criteria for progression on the upper pay scale and putting them in the pay document; and further defining the detail of an excellent teacher scheme. I would welcome comments from all statutory consultees on these additional proposals.

  Main pay scale and threshold assessment

  The STRB recommends the following (in bold):

  (a) on the basis of a teacher's performance and professional development over the past year the head teacher should decide and record in writing whether or

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  not he or she has achieved at least the standard required to merit an increment on the main scale;

  (b) where performance is judged to be outstanding and continues at that level for two years it should merit a double increment;

  (c) where performance falls below the standard required, the increment should be deferred and an improvement plan should be put in place, with the appropriate support. The decision to defer should be reviewed in mid-year after which the increment would be backdated to the previous September, provided that the necessary progress had been made. A continuing unsatisfactory performance would result in the withholding of the increment.

  During discussions on ways of ensuring appropriate rigour in performance management and related pay decisions, the parties give careful consideration to the development of a common system, building on the practices which already exist and taking into account the model employed in certain schools.

  I am pleased that the STRB shares my strong belief that, "a rigorous performance management system, robustly applied by school leaders should be the hub of all progression". I further share its concerns that heads have difficulty distinguishing between the performance of individual teachers and agree that a more explicit linkage between performance, professional development and progression might go some way to address this issue. These STRB recommendations are a helpful step forward and I propose to press ahead with proposals to ensure that progression on the main pay scale is treated in this way from September 2005.

  I too believe that these decisions about pay progression can best be made within a consistent framework for performance management in schools. Part of the rationale for my proposal, put forward jointly with the co-signatories to the rewards and incentives agreement, was the need to encourage fair and objective decisions on pay progression. I therefore also endorse the STRB's recommendation to consider carefully with parties the need to develop a common system.

  Threshold Assessment

  The STRB recommends the following (in bold):

  That, over the next 18 months:

  (a) the department and, where appropriate, the Welsh Assembly Government take action to ensure that:

  a. all heads have received appropriate training on linking pay and performance; and

  b. a satisfactory appeal route for disputes over pay decisions, which includes an independent element,

  (b) the department and, where appropriate, the Welsh Assembly Government work with the statutory consultees:

  a. to maintain existing standards of decision-making on threshold applications; and

  b. to establish a quality assurance system as envisaged in paragraph 12 of the joint proposal.

  From September 2005, threshold assessments are made at school level in the context of the school's developed performance management system; and
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  external validation of the threshold assessment decisions of the teacher is discontinued.

  The STRB has made a number of strong recommendations about the future of threshold assessment arrangements which I accept in principle. I note the STRB cites evidence from the PwC study which shows that threshold assessment has largely bedded in and the important role external assessment is likely to have played in that process. I welcome the statement that subject to improvements to the performance management system and the maintenance of threshold standards, the body sees "no absolute need to retain the external assessment system".

  I too am keen to ensure that we continue to maintain appropriate mechanisms for ensuring continued fairness and equity in threshold decisions and I am grateful for the review body's suggestions for securing that this is the case. As recommended by the STRB, I propose to consult on the arrangements for the light-touch validation of performance management systems and the best way to maintain threshold standards. As teacher appraisal is devolved, proposals regarding performance management systems in Wales are a matter for the Welsh Assembly Government. On the narrow issue of the timing of the ending of the current threshold assessment scheme, I can see considerable gains-including significant financial savings-with maintaining the end date of August 2004, but would welcome views from all statutory consultees.

  I am pleased to endorse the STRB recommendation that heads should be trained on linking pay to performance. Work is already in hand to expand the existing range of flexible training materials for head teachers and governors to include a further element focusing on the links between performance and pay decisions. The recommendations of the review body are helpful to the development of this package which we hope to progress with the help of the other pay partners.

  Local Approaches to Pay

  The STRB has recommended the following (in bold):

  The parties consider the proposal we have described and present us with their evidence and views by September 2004.

  I welcome the rigorous and methodical way the STRB has approached the issues around local and regional pay. It has clearly set out a range of difficult issues which need to be looked at when considering how best one should tackle any residual barriers to recruitment and retention that may still exist within our current pay system of geographical banding. While noting the importance of each school tackling any other barriers to their success-including clear leadership and management structures, appropriate and available CPD and other measures designed to promote a positive environment for staff-it has offered interesting proposals for resolving many of those hard core recruitment and retention issues which might remain.
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  I welcome the STRB's recommendation to consult with other parties on this proposal and provide evidence from the department by September.

  Additionally, I am clear that the implications of this proposal will need to be considered alongside recommendations forthcoming from the Adrian Smith review on mathematics post-14 where, here too, there were interesting proposals about how to tackle subject recruitment difficulties in specific schools and areas.

  Teachers' Pay system and career structure

  The STRB has recommended the following (in bold):

  The AST spine is reduced to 18 points with values parallel to points 1 to 18 of the leadership group spine not later than September 2006.

  Clear record is made of their annual review and subsequent decision on salary progression.

  I welcome the STRB's recognition of the importance and distinctiveness of the AST role, "in leading excellent curriculum and teaching practice in schools and institutions beyond their own school". I agree that we must ensure that they are afforded the necessary status within the school structure as befits the very important role they play in so many schools. Therefore I endorse the recommendation to reduce the AST spine to 18 points with values equivalent to the first 18 points of the leadership group spine.

  Furthermore I believe, all teachers, irrespective of their role, should expect to have clear records from their annual review which would set out, among other important issues such as objectives and professional development needs, any decisions made about salary progression. I therefore also endorse the STRB's proposals that ASTs be entitled to a clear record of their annual review and any subsequent pay decision.

  I am grateful to the STRB for its consideration of the issues regarding chartered London teacher status and I propose that an appropriate amendment is made to the STPCD in September 2004 to cover this.

  Special Pay arrangements

  The STRB has recommended the following (in bold):

  LEAs review their procedures during 2004 to ensure that unattached teachers are not at a disadvantage compared to attached teachers, and the national employers' organisation oversees the review and published the results so that they are available to the other parties.

  The department sets up a comprehensive database on unattached teachers, covering numbers, location and roles.

  The department draws up guidance, in consultation with the interested parties, including BATOD, on how the payment of SEN allowance 2 might take account of the enhancement of the teaching of SEN children brought about by such specialist qualifications.

  The safeguarding of the social priority allowance and the inner London area supplement is removed with effect from 1 September 2004.
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  The department considers the following navigation aids when revising the document:

  Adding a comprehensive index, with cross-references to other useful linked documents such as explanatory notes for heads, governors and LEAs and model school teachers' pay policy;

  Including a 3–4 page summary at the beginning describing the teachers' career options and pay system using diagrams; and

  Consulting on areas for pay simplification, including the balance between guidance and formal provisions.

  We also recommend the provision of more training for governors in the understanding of the teachers' pay system, the navigation around the document and its use in considering the school pay policy.

  I am grateful to the STRB for its consideration of a range of further issues around the smooth and appropriate operation of the structures of the teachers pay system.

  The STRB is right to draw our attention to concerns about the position of unattached teachers. I too think it is important for all teachers, whether they are attached to a school or not, to be treated fairly and equitably and I welcome the recommendations.

  I support the idea of a review of LEA procedures related to unattached teachers and I look to NEOST to take this forward as it sees fit. On the further recommendation about the establishment of a comprehensive database on unattached teachers, it would not be practicable, for a number of reasons, to seek to develop a new database at this point. The best mechanism for delivering this will be through the adult common basic data set, which, from 2006, I anticipate being the key and most comprehensive source for information about the school workforce, including unattached teachers. I therefore accept this recommendation in the context of the developments on the adult common basic data set.

  I am content to discuss with relevant parties how the Payment of SEN allowance 2 might take into account the enhancement of the teaching of SEN children brought about by specialist qualifications. The outcome of this exercise should be without prejudice to consideration of the wider allowance framework.

  I appreciate the attention given by the STRB to the matter of safeguarding, particularly its exposition of the balance needed between the need to protect teachers salary and the potentially inhibitory effect safeguarding can have on necessary and desirable changes in school organisation. The body reminds us that its thinking on both management allowances and recruitment and retention allowances in part one to this report took into account its desire to avoid long-term payments of increasing value for purposes which might no longer apply. I welcome the recognition that paragraph 48 to the STPCD contains sufficient flexibility to render the need to offer separate specific payments for both social priority allowance and the inner London area supplement unnecessary. I hope this will be a welcome flexibility and simplification for schools. I am also grateful for the body's steer on the issues it believes should be discussed in our

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  conversations with key parties on the issue of safeguarding. I am minded therefore to press ahead with the abolition of safeguarding for both the social priority allowance and the inner London area supplement from September 2004.

  I also welcome the STRB's further comments on simplification of the existing pay system through looking at how we might better position the content of the document to make it accessible to the range of audiences that are required to use it. This is a something of an iterative process for us but one which it is important that we press on with, a key part of which is making the pay system itself more streamlined. I therefore accept the STRB's recommendations around simplifying the document including the further need to consult on more substantive simplification of the pay systems. I wholeheartedly endorse the need to ensure governors are clear on the operation of the pay system and the flexibilities within it. As I have already mentioned, work has already begun on devising a toolkit for trainers on teachers' pay and pay policies, I propose that this training be disseminated to governors and head teachers together.

  Universities
  Baroness Ashton of Upholland
  My right honourable friend the Minister of State for Lifelong Learning, Further and Higher Education (Alan Johnson) has made the following Written Ministerial Statement.

  I am today publishing the results of the consultation on proposed new criteria for degree awarding powers and university title, which ended on 12 December 2003. The consultation followed a commitment in the White Paper The Future of Higher Education to modernise the criteria governing the granting of degree awarding powers (DAP) and to allow university title (UT) to be granted on the basis of taught DAP and student numbers.

  There were mixed views on the proposal to allow teaching-focused universities, with universities generally opposed and other higher education institutions (HEls) in support. Most respondents felt the proposed criteria for taught DAP were clearer than the current criteria and strengthen the requirements staff have to meet. Most universities supported retaining the current student number criterion for UT with other HEIs divided on whether the level should be maintained or lowered. More respondents than not were in favour of allowing specialist institutions to be eligible for UT.

  The proposal for DAP in future to be granted for six-year terms, renewable subject to a satisfactory audit, was opposed by most respondents. Two-thirds of universities and virtually all other HEIs expressing an opinion were against the proposal. The Standing Committee of Principals cited legal difficulties with the proposed changes. In light of these concerns, we will issue a discussion paper on renewable DAP shortly. We want to balance the concerns expressed with the Government's desire to ensure that the quality and
  WS 20
  reputation of higher education in England and Wales is maintained. The moratorium on new applications for degree awarding powers will remain in place while this matter is discussed further with the higher education sector and others. In the mean time, the moratorium on new applications for university title under the current criteria is lifted.

  The consultation report has been placed in the Libraries of both Houses and is available on the Department for Education and Skills website at: www.dfes.gov.uk/consultations/conResults.cfm?consultationId = 1226

  Consolidated Fund Bill
  The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey)
  I have made a statement under Section 17(1)(a) of the Human Rights Act 1998 that, in my view, the provisions of the Consolidated Fund Bill are compatible with the convention rights. A copy of the statement has been placed in the Library of the House.

  Patent Office: Performance Targets 2004–05
  The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville)
  I have tasked the Patent Office with broadening its activities to support the delivery of the Government's innovation strategy. During the coming year, the Patent Office will develop these new activities and form partnerships through which new services will be delivered.

  I have also set the Patent Office the following targets for 2004–05:

  Patents

  1. To be issuing 90 per cent of search reports within five months of request by the end of the year.

  2. Grant 90 per cent of patents within three years of request.

  Designs

  3. Register 90 per cent of correctly filed design applications, to which no substantive objections have been raised, within three months of the date of application.

  Trade Marks

  4. Register 90 per cent of processed trade mark class applications, to which no substantive objections are raised or oppositions filed within eight months of application.

  5. Reduce to an average of 26 weeks the time taken to issue a decision in trade mark inter partes cases once the case is ready.

  6. Ensure that the proportion of bad acceptances published in the Trade Marks Journal is less than 1 per cent.

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  Policy

  7. Establish a baseline and metrics for IP awareness and a target for 2005–06.

  Efficiency Targets

  8. Increase output in relation to current expenditure by an average of at least 2 per cent per annum over a rolling three-year period.

  In addition to these key targets:

  Customer Service Standards
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  Meet our customer service standards as shown in the annual report and on our website at www.patent.gov.uk

  Finance

  Pay 100 per cent of bills within 30 days of receipt of goods or services or a valid invoice, whichever is the later

  Questions delegated to the Chief Executive

  Reply within 10 working days to all letters from Members of Parliament delegated for the chief executive's reply.